FactSet Research Systems Inc. Q1 FY2026 earnings call

• Strong ASP growth of 5.9% to $2.4 billion, adjusted operating margin of 36.2%, and adjusted diluted EPS of $4.51, up 3% year on year. - Secured key client wins including a mandate with a large warehouse breakaway team, displacing an incumbent at a global top 10 bank, and a major win with a world's largest investment manager. - Increased share repurchase authorization from $400 million to $1 billion. - Priorities: driving commercial excellence (sharpening sales execution, simplifying packaging/pricing, improving retention/expansion, modernizing sales operations), delivering productivity improvements (reviewing technology/processes, transforming legacy tech, using text-to-formula agent to reduce support traffic), and solidifying long-term strategy. - Financial results: Revenues grew 6.9% year over year to $608 million, adjusted operating margin 36.2%, adjusted earnings per share $4.51. - Investment priorities: Two-thirds allocated to growth (differentiated data universe, deepening client workflows) and one-third to internal infrastructure (upgrading go-to-market tools, modernizing core infrastructure).

Regional performance: In The Americas, organic ASV grew 6% this quarter driven by asset managers and wealth. In EMEA, organic ASV grew 4% this quarter with higher expansion in Performance Solutions and improved retention. In Asia Pacific, organic ASV grew 8% this quarter with middle office solutions and AI-ready data driving growth. By firm type: Institutional buy side delivered 4% organic ASV growth with broad-based strength; wealth delivered 10% organic ASV growth with displacements of incumbents; deal makers had 6% organic ASV growth year over year. Client count grew to over 9,000, up 9% year over year, and user base approached 240,000, with wealth and asset managers leading user growth.

• Reaffirmed previously issued FY '26 guidance across all metrics. - Expect Q2 operating margins to reflect the step-up in investment as they bring on headcount and technology resources. - Maintaining a prudent and conservative approach to guidance, focused on executing against commitments and providing updates as visibility increases.

Q: I feel like recently there's been a lot of discussion around FactSet's competitive positioning versus AI startups. I'm actually more curious to hear your perspective on how FactSet is positioned amongst the Big Four data incumbents.

A: Sanoke Viswanathan stated they are confident in their proprietary assets in data and tools, partner with AI ecosystem, and clients are asking them to be consolidators of AI solutions. Goran Skoko added they feel strongly about their competitive position, keep investing in content assets, and data solution was a big driver of Q1 results Q: Thank you so much. Good morning. Sanoke, thank you for your detailed comments regarding your priorities. A few things stuck out to me regarding, you know, commercial excellence. You talked about sort of simplifying pricing, packaging, pricing to value. And some of the changes around, you know, sales incentives. And it sounds like you're saying it's already led to, you know, faster sales motion and a richer pipeline. So we'd love to hear a little bit more, sort of bring to light some of the changes that you have either already incorporated and, you know, the early results that you're seeing.

A: Sanoke Viswanathan said they aligned incentives across the board, focusing on new business development, cross-selling, and upselling, seeing faster sales motion and a richer pipeline, with more work ahead on systems and analytics to reduce churn Q: Hey, guys. Hopefully, you hear me now on this line. Seems like you are. You hear me? Sorry. Yes. Yes. All clear. Anyways, I think this was asked when I disconnected, but the other question I'm getting related to AI a lot when it comes to you guys is also how the hiring picture is gonna look for your customer base in the future because obviously, not only you, but your customers are talking about using AI for efficiency. And, you know, 50% of your business is still a desktop business. So maybe you with your discussions you've been having with clients, where do you hear that the most? Like, what client types do you think you can actually see some maybe a customer reductions in terms of the seat? So and how do you stack up in those areas? Meaning, you know, where do you see the biggest reduction of force, and how does this impact your kind of desktop-related businesses?

A: Sanoke Viswanathan said they've met with dozens of clients and not seen real reduction in headcount, actually seeing increased hiring in banking, and clients are looking to augment FactSet solutions with their AI products, not reducing seats yet