Fair Isaac Corporation

Good day and thank you for standing by. Welcome to the second quarter 2026 FICO 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 this session, you'll need to press star 1-1 on your telephone. You will then hear an automated message advising you your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Dave Singleton. Please go ahead, sir.

Good afternoon, and thank you for attending FICO's second quarter earnings call. I'm Dave Singleton, Vice President of Investor Relations, and I'm joined today by our CEO, Will Lansing, and our CFO, Steve Weber. Today, we issued a press release that describes financial results compared to the prior year. On this call, management will also discuss results in comparison with the prior quarter to facilitate understanding of the run rate of the business. Certain statements made in this presentation are forward-looking under the Private Securities Litigation Reform Act of 1995. Those statements involve many risks and uncertainties that could cause actual results to differ materially. Information concerning these risks and uncertainties is contained in the company's filings with the SEC, particularly in the risk factors and forward-looking statements portions of such filings. Copies are available from the SEC, from the FICO website, or from our investor relations team. This call will also include statements regarding certain non-GAAP financial measures. Please refer to the company's earnings release and Regulation G schedule issued today for reconciliation of these non-GAAP financial measures to the most comparable GAAP measure. The earnings released and Regulation G schedule are available on the investor relations page of the company's website at FICO.com or on the SEC's website at SEC.gov. And a replay of this webcast will be available through April 28th We have refreshed our quarterly investor presentation with additional content, which is available in the investor relations section of our website. We will refer to this presentation during today's earnings announcement. I will now turn the call over to our CEO, Will Lansing.

Thanks, Dave, and thank you everyone for joining us for our second quarter earnings call. We had a very strong quarter and a great start to the first half of our fiscal year. Based on our results and outlook, we are increasing our fiscal 2026 guidance. We reported Q2 revenues of $692 million, up 39% over last year, as shown on page five of our investor presentation. For the quarter, we reported $264 million in GAAP net income in the quarter, up 63%, and GAAP earnings of $11.14 per share, up 69% from the prior year. We reported 297 million in non-GAAP net income, up 54%, and non-GAAP earnings of $12.50 per share, up 60% from the prior year. We delivered free cash flow of 214 million in our second quarter. Over the last four quarters, we delivered 867 million in free cash flow, an increase of 28% over the prior four-quarter period. In Q2, We continued returning capital to shareholders through share repurchases, buying back $605 million, or 484,000 shares, at an average price of $1,251 per share. At the segment level, shown on page 6, our second quarter score segment revenues were $475 million, up 60% versus the prior year. While B2B scores were the key driver of growth, we also experienced the sixth straight quarter of growth in B2C scores. In our software segment, we delivered $217 million in Q2 revenues, up 7% over last year. Results included 54% platform revenue growth and a 12% decline in non-platform revenue. Steve will provide additional revenue details later in this call. Last week, we issued a statement on our website in response to the FHFA and FHA update on credit score modernization. We applaud the FHFA and FHA initiative to get FICO Score 10T into the market in the coming months. FICO Score 10T is the most predictive credit score for all borrowers, including first-time home borrowers. FICO Score 10T incorporates rental and utility payment history, enabling more consumers to qualify for mortgages. To support the goal of increased homeownership and bring the benefits of increased competition to the marketplace, we updated our FICO Score 10-T performance model pricing in the FICO Mortgage Direct Licensing Program from $4.95 per score plus $33 funding fee to $0.99 per score plus $65 funding fee. We anticipate the release of FICO Score 10-T data in the timeline provided by the FHFA and GSEs. In the last quarter, we added 11 more lenders to our FICO Score 10-T Early Adopter Program. As a reminder, through this program, FICO Score 10-T is made available for free with the purchase of Classic FICO. The 55 lenders in the program account for more than $495 billion in annual serviceable originations when evaluated using 2025 HMDA data and more than $1.6 trillion in eligible servicing. We're moving closer to the go live dates of our next generation cashflow ultra FICO score with our strategic partner Plaid and the FICO mortgage direct licensing reseller partners. We continue to actively work alongside participants to support testing on both initiatives. As AI adoption accelerates, we recognize the need of stakeholders to weigh the associated opportunities and risks. At FICO, we view AI as a tremendous opportunity that we've committed significant resources to for several years. In the scores business, AI is limited by strict regulatory requirements on credit underwriting outcome explainability and model governance. In addition, our scoring models are supported by proprietary data access, mainly with credit bureaus, and deep ecosystem integration. Across both businesses, FICO has been issued 137 AI-based patents, which include patents in blockchain technology that are helpful for traceable and explainable decision-making. the type of market-leading innovation that will be in high demand as businesses seek ways to safely deploy AI analytics in highly regulated industries. In our software business, as shown on page 13, FICO platform is architected from the ground up to be agentic by design. That foundation delivers decision-grade analytics, deep domain expertise, and an enterprise platform that clients depend on for precision, consistency, explainability, and trust. These principles are non-negotiable for our primary target market, the highly regulated financial services industry. FICO Platform is the world's leading AI decisioning platform for financial services, recognized as such as a leader by Gartner, Forrester, and IDC. Its agentic architecture powers a real-time, always-on customer profile engine that delivers hyper-personalized consumer experiences where every interaction can inform and improve the next. There are over 150 clients globally using the FICO platform across multiple connected use cases to power their customer experience, business critical operations, risk management, and fraud monitoring and prevention. FICO platform brings together multiple functions within an enterprise in a common operating environment and enables them to operationalize AI at scale to drive real business outcomes. Financially, a substantial majority of our nearly 350 million platform segment annual recurring revenue is driven from FICO platform. Financially, a substantial majority of our platform segment annual recurring revenue approaching 350 million and growing rapidly is driven by the FICO platform, reflecting years of proven commercialization. FICO transforms 70 years of proven deep domain knowledge into validated, explainable AI that powers the most consequential business decisions. with that expertise embedded directly into the agents, models, and guardrails that operate on the platform. FICO platform accelerates client innovation by providing clients with the ability to build, test, optimize, and monitor decisioning across the enterprise. With FICO AI guided operations, clients create a self-reinforcing cycle of value generation, reinvesting outcomes back into the platform by enabling additional use cases, driving further value for their businesses. FICO's platform FICO Platforms Marketplace and FICO Assistant unlock broader capabilities that compound with scale. Every new model, agent, and integration from the ecosystem strengthens the customer profile engine and accelerates consumption of proprietary capabilities across the platform. At FICO, AI is already driving meaningful results today while creating significant opportunities that we are well positioned to capture. I'll now pass it back to Steve to provide further financial details.