AI Takeaway
FICO delivered strong Q1 FY2026 results with revenue up 16.4% YoY to $512.0M and operating margin expanding nearly 5 percentage points to 45.7%, though aggressive share buybacks have deepened the stockholders' equity deficit to -$1.81B.
Revenue
$511.96M
++16.36% YoY
EPS (Basic)
$6.68
++6.71% YoY
Operating Income
$234.05M
++30.37% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-Q filing
Total revenue grew 16.4% YoY to $512.0M in Q1 FY2026, up from $440.0M in the prior-year period. Cost of revenue was essentially flat at $87.3M (-0.1% YoY), indicating that incremental revenue is flowing through at very high margins, consistent with FICO's software and scores business mix.
Source: Source: 10-Q Income Statement
Operating income surged 30.4% YoY to $234.0M, pushing operating margin from 40.8% to 45.7% — a nearly 5-percentage-point improvement. SG&A and R&D grew at a combined ~10% pace, well below revenue growth of 16.4%, demonstrating meaningful operating leverage.
Source: Source: 10-Q Income Statement
Net income rose only 3.8% YoY to $158.4M despite operating income growing 30.4%, implying a significant increase in below-the-line costs — most likely interest expense on the company's expanded long-term debt load, which grew 32.9% YoY to $3.20B.
Source: Source: 10-Q Income Statement & Balance Sheet
2 more insights available
Upgrade to unlockFICO's stockholders' equity stands at -$1.81B, worsening from -$1.14B a year ago, driven by debt-funded share buybacks. Long-term debt has grown to $3.20B, and total liabilities of $3.66B far exceed total assets of $1.85B. This balance sheet structure creates significant financial risk if earnings or cash flows deteriorate.
Source: Source: 10-Q Balance Sheet
Unlock 4 more detailed risk analysis
Upgrade to unlockReported EPS of $7.33 versus the $7.20 analyst consensus — a +1.8% beat for Q1 FY2026.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $511.96M | $439.97M | +16.36% |
Cost of Revenue | $87.26M | $87.34M | -0.10% |
Operating Income | $234.05M | $179.53M | +30.37% |
Net Income | $158.37M | $152.53M | +3.83% |
EPS (Basic) | $6.68 | $6.26 | +6.71% |
EPS (Diluted) | $6.61 | $6.14 | +7.65% |
R&D Expense | $49.91M | $45.15M | +10.56% |
SG&A Expense | $140.74M | $127.95M | +9.99% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $1.85B | $1.71B | +8.65% |
Current Assets | $698.81M | $595.84M | +17.28% |
Total Liabilities | $3.66B | $2.84B | +28.74% |
Current Liabilities | $752.06M | $331.32M | +126.99% |
Stockholders' Equity | $-1.81B | $-1.14B | -58.86% |
Cash & Equivalents | $162.03M | $184.25M | -12.06% |
Long-Term Debt | $3.2B | $2.41B | +32.86% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $174.08M | $194M | -10.27% |
Investing Cash Flow | $-12.73M | $-8.94M | -42.41% |
Financing Cash Flow | $-133.48M | $-144.22M | +7.44% |
Share Buybacks | $171.17M | $162.58M | +5.28% |
D&A | $4.02M | $3.54M | +13.64% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Margin | 45.7% | 40.8% | +4.91% |
Net Margin | 30.9% | — | — |
ROE | -8.8% | — | — |
ROA | 8.5% | — | — |
Current Ratio | $0.929 | — | — |
Debt to Equity | $-2.025 | — | — |
Other companies in Application Software
FICO reported Q1 FY2026 revenue of $512.0M, up 16.4% YoY, with operating income surging 30.4% to $234.0M and operating margin expanding to 45.7%. Net income grew a more modest 3.8% to $158.4M, held back by higher interest costs on the company's growing debt load.
FICO's stockholders' equity is -$1.81B because the company has aggressively repurchased its own shares using debt, spending $171.2M on buybacks in Q1 FY2026 alone. This strategy boosts EPS and returns capital to shareholders but results in total liabilities of $3.66B far exceeding total assets of $1.85B.
FICO carries $3.20B in long-term debt as of Q1 FY2026, up 32.9% YoY, and current liabilities surged 127% to $752.1M — likely reflecting near-term debt maturities. The company's cash balance stands at only $162.0M, making refinancing risk a key concern for investors.
FICO's revenue grew 16.4% YoY to $512.0M in Q1 FY2026, driven by its high-margin Scores and software businesses. Notably, cost of revenue was essentially flat at $87.3M, meaning nearly all incremental revenue flowed through to gross profit.
The most significant risks are FICO's highly leveraged balance sheet with $3.2B in long-term debt, a current ratio below 1.0 (0.93) suggesting near-term liquidity pressure, and the growing interest expense burden that is limiting net income growth to just 3.8% despite 30.4% operating income growth. Regulatory or competitive threats to its core FICO Score franchise also represent a key business risk.