FactSet Research Systems Inc.

Good day, and thank you for standing by. Welcome to the FactSet first quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Yet He, Interim Head of Investor Relations.

Thank you and good morning, everyone. Welcome to FactSet's first fiscal quarter 2025 earnings call. Before we begin, the slides we referenced during this presentation can be found through the webcast on the investor relations section of our website at factset.com. A replay of today's call will be available on our website. After our prepared remarks, we will open the call to questions from investors. The call is scheduled to last for one hour. To be fair to everyone, please limit yourself to one question. You may re-enter the queue for additional follow-up questions, which we will take if time permits. Before we discuss our results, I encourage all listeners to review the legal slip notice on slide two, which explains the risk of forward-looking statements and the use of non-GAAP financial measures. Additionally, please refer to our forms 10-K and 10-Q for a discussion of risk factors that could cause actual results to differ materially from these forward-looking statements. Our slide presentation and discussions on this call will include certain non-GAAP financial measures. For such measures, reconciliations of the most directly comparable GAAP measures are in the appendix to the presentation and in our earnings release issued earlier today. During this call, unless otherwise noted, relative performance metrics reflect changes as compared to the respective fiscal 2024 period. Also, please note that beginning in this first quarter fiscal 2025, Backset will be reporting organic ASV rather than organic ASV plus professional services to focus on the recurring nature of our revenues. Joining me today are Phil Snow, Chief Executive Officer, Helen Shan, Chief Financial Officer, and Goran Skoko, Chief Revenue Officer. I will now turn the discussion over to Phil.

Thank you, Yet, and good morning, everyone. I'm pleased to share our first quarter results. We're off to a good start in fiscal 2025 with solid operating performance, growing organic ASV 4.5% year-over-year, delivering adjusted operating margin of 37.6%, and achieving adjusted diluted EPS of $4.37. While a backdrop of macro uncertainty and cost pressure faced by clients continues to persist, we saw momentum building during the first quarter. We remain cautious, but I'm encouraged by the constructive dialogue we are having with clients and the trends we are seeing in the pipeline. As a reminder, the ASV we add in the first quarter is seasonally the lowest of the year. Given the timing of large deals, it is also important to look at half and full year performance as more holistic measures of our progress. Consistent with our prior guidance, we expect ASV growth in fiscal 2025 will be second half weighted. Before turning to our financial results, I want to thank those of you that joined our Investor Day last month and for the positive feedback we received. For those that missed it, we discussed FactSet's strategy to supercharge financial intelligence and help clients as their trusted data and technology partner by delivering efficiency and innovation to their end-to-end workflows. This strategic direction builds on our market-leading franchises across the firm types we serve and is underpinned by our technology evolution, investment priorities, and product roadmap. There's still much to do, but we are confident in our ability to execute and achieve the medium-term targets we shared with you at Invest Today. Demand for our solutions remains steady with ASV retention over 95% and client retention at 91%. During the first quarter, we grew our client base to almost 8,250, and our continued expansion within wealth drove our user count to over 218,000. Turning now to our organic ASV performance by region, in the Americas, we grew 5% as we lapped a significant wealth win in Q1 last year. New business accelerated in the quarter across wealth, hedge funds, and asset owners, and improved retention across asset managers was overshadowed by softness in areas where clients are reprioritizing budgets. In EMEA, we experienced 4% growth, driven by wins in partnerships and asset owners with additional contribution from PEVC, hedge funds, and overall improved retention in the region. And in Asia Pacific, we maintained 7% growth, improved seasonal hiring and banking relative to last year as a driver, particularly among global bulge bracket banks. Data solution wins with partners were offset by lower retention with asset manager clients. From a firm-type perspective, our results were mixed. After a very strong Q4 to close the year, wealth organic ASV growth was more subdued in the first quarter. Seat count continues to increase at a strong clip, sequentially adding over 2,000 users driven by marquee accounts. We also continue to add smaller wealth management clients this quarter. It's difficult to control the timing of when large deals close, but we remain confident the deceleration this quarter is temporary. And within wealth, we continue to see a healthy pipeline of seven-figure opportunities with potential to upsell existing clients and expanding solution set, giving us conviction that growth will re-accelerate over the next several quarters. In dealmakers, growth was in line with last quarter. Banking, seasonal hiring continues to normalize, but remains a drag to growth. As discussed at Investor Day, we expect several new products will add to the acceleration of our banking business in the second half of the year. Most notably, our GenAI-powered Pitch Creator offering is already seeing traction in our client conversations, with two wins in Q1 ahead of our formal launch in early calendar 2025. Outside of banking, we saw continued acceleration in PEVC to double-digit growth, led by several competitor displacements, and strength in Cobalt, our modern portfolio monitoring tool. Adding to corporates, we closed the acquisition of Owen in early November to expand FactSet's ability to address the integrated workflow needs of IR professionals with an integrated modern solution. We have a strong pipeline and have already seen increased inbound interest from investor relations users since the acquisition was announced. For the institutional buy side, we maintain growth consistent with last quarter. The highlight for the quarter is a landmark seven-figure performance solutions win, where we beat a competitor and displaced key incumbents at a global outsourced CIO provider, seeking to overhaul their technology stack and solutions across the portfolio lifecycle. This wide-ranging enterprise deal includes our portfolio analytics, multi-asset class capabilities, and performance reporting solutions. This win also underscores Faxit's ability to effectively partner with clients using our managed services offering to deliver workflow efficiencies and an improved operating model. Within asset management, we continue to see erosion pressure as clients scrutinize their budgets and pursue vendor consolidation, particularly with small and mid-sized firms where it is more difficult to reach scaled efficiencies. Our recently announced partnership with J.P. Morgan's security services seeks to address this total cost of ownership challenge by coupling Faxit's performance reporting and portfolio analytics solutions with accounting and investment book of records through J.P. Morgan's Fusion data management platform. For partnerships and CGS, growth was solid. Improved retention and an increase in larger wins with partners contributed to accelerating growth. CGS continues to perform well, buoyed by the strong issuance market and content expansion. As we execute against the strategy we outlined at Invest Today, clients are increasingly viewing FactSet as an innovation partner that can help them gain greater insights, drive lower cost of operations, and elevate productivity so they can focus on high-value work. We are leveraging our industry-leading data and technology to responsibly harness the power of GenAI to bring more speed, accuracy, and efficiency to our clients. Building on the AI blueprint we announced last year, we recently unveiled our Intelligent Platform Initiative, which integrates conversational AI at the platform level to enable next-generation search intelligence. This latest innovation in our series of new product developments leverages FACTS at Mercury, our conversational knowledge engine to provide actionable and auditable insights across our extensive content refinery of structured and unstructured data assets. We hear loud and clear from our clients that they are not interested in marketing hype and promises of the future. They are demanding practical workhorse solutions to boost productivity, unlock efficiencies, and optimize daily workflows. we will be launching new workflow solutions throughout the year that will add to our rapidly evolving Gen-AI capabilities and product set. In summary, I'm pleased with the start to this year. It's worth reiterating that similar to last year, we expect growth to be weighted towards the back half of the year. As we head into the start of calendar 2025, I'm encouraged by early signs of momentum picking up as clients reset budgets and what many are anticipating as an improved macro backdrop. there's budding confidence that the operating environment may improve as we progress through the year. A few examples of green shoots this quarter include greater client engagement in banking, strengthened data solution sales to hedge funds, and greater pace of competitor displacements in PEVC, to name a few. We have a robust pipeline, greater visibility on some larger opportunities, and many new innovative products that resonate with clients. I'm confident in our path forward. As such, we are reaffirming our fiscal 2025 guidance. I will now turn it over to Helen to discuss our first quarter performance in more detail.