TransUnion

Good day and welcome to the TransUnion's third quarter 2025 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then 1 on your telephone keypad. To withdraw your question, please press star then 2. Please note, this event is being recorded. I would now like to turn the conference over to Greg Bardi, Vice President of Investor Relations. Please go ahead.

Good morning and thank you for attending today. Joining me on the call are Chris Cartwright, President and Chief Executive Officer, and Todd Sellow, Executive Vice President and Chief Financial Officer. We posted our earnings release and slides to accompany this call on the TransUnion Investor Relations website this morning, and it can also be found in the current report on Form 8K that we filed this morning. Our earnings release and the accompanying slides include various schedules, which contain more detailed information about revenue, operating expenses, and other items, as well as certain non-GAAP disclosures and financial measures, along with the corresponding reconciliation of these non-GAAP financial measures to their most directly comparable GAAP measures. Today's call will be recorded, and a replay will be available on our website. We will also be making statements during the call that are forward-looking. These statements are based on current expectations and assumptions and are subject to risks and uncertainties. Actual results could differ materially from those described in the forward-looking statements because the factors discussed in today's earnings release, in the comments made during this conference call, and in our most recent Form 10-K, Forms 10-Q, and other reports and filings with the SEC. We do not undertake any duty to update any forward-looking statement. With that, let me turn it over to Chris. Thanks, Craig.

During the third quarter, TransUnion again exceeded all key guidance metrics and achieved its seventh consecutive quarter of of high single digit organic revenue growth. These results demonstrate the growing momentum of our innovation led strategy. I want to outline four key highlights from the quarter. First, we delivered market leading and diversified growth with revenue increasing by 11% on an organic constant currency basis, excluding the significant breach remediation win from last year, which represents our strongest underlying performance since 2021. Second, we are raising our 2025 guidance across all metrics, reflecting our strong third quarter performance, stable lending trends in the U.S., and new business wins. U.S. lending conditions continue to be solid, characterized by modest GDP growth, still strong employment, stable delinquencies, lower interest rates, and manageable inflation. And this is despite emerging concerns regarding a slowing labor market and stress for lower-income consumers. Third, we advanced our technology modernization with successful migration of our first U.S. credit customers. One truth is accelerating our pace of innovation in credit and non-credit products. We remain on track to achieve our remaining structural cost savings in 2026 as anticipated. And fourth, we accelerated our share repurchases to take advantage of highly attractive valuation levels. During the third quarter and October, we repurchased 160 million in shares, bringing the year-to-date total to 200 million. Additionally, we increased our share repurchase authorization to 1 billion, underscoring our commitment to delivering value to shareholders. Further details on each of these highlights are discussed below. Now, our third quarter results demonstrate effective execution against our growth playbook. with strength evident across our solutions, our verticals, and our geographies. U.S. markets delivered 13% organic constant currency revenue growth when excluding last year's breach win. Financial services grew 19%, or 12%, excluding mortgage, reflecting continued broad-based outperformance in a stable and modestly growing market. Emerging verticals accelerated to 7.5%. their strongest growth since 2022. Our non-credit solutions, which account for over half of U.S. market's revenue, grew 8%. These results reflect the emerging commercial benefits across our vertical markets from our accelerating innovation in credit marketing fraud and communications. Now, international revenue grew by 6% on an organic constant currency basis. Canada, the U.K., and Africa all exceeded expectations and achieved double-digit growth despite muted economic conditions in each market. India grew 5%, slightly below our outlook, as new tariffs impacted U.S. export-dependent small and medium-sized businesses, which tempered the pace of lending recovery. We now expect high single-digit revenue growth in India in the fourth quarter. On a positive note, we experienced some volume improvement in the first days of the festival season in late September and early October, this supported by further pro-growth actions from the RBI and the Indian government. Todd will provide a comprehensive review of our results in just a minute. Now, looking ahead, we're raising our 2025 outlook based on our strong third quarter results, stable U.S. lending trends, and our continued commercial momentum. Our guidance raise maintains a prudently conservative approach, which offers likely upside if current lending conditions continue. Now, at the high end of guidance, we now expect 8% organic constant currency revenue growth, or 9% excluding last year's large breach win, 9% adjusted EBITDA growth, and 9% adjusted diluted earnings per share growth. Excluding the 400 basis point impact of a higher tax rate in 2025, Our results show another year of double-digit EPS growth, supported by our consistent execution and the strength of our diversified and resilient portfolio. Now, we continue to advance our technology modernization to drive cost savings, accelerate innovation, and enable sustainable growth. In the third quarter, we completed the migration of our first U.S. credit customers to Key Milestone. We're enabling these clients with faster processing speeds and seamless access to our newest innovations, including TrueIQ analytics. Additionally, we expanded our dual-run program for key customers. We're partnering closely with our customers to ensure smooth transitions ahead of a full migration. And by year-end, we expect OneTrue to power a critical mass of our run rate U.S. credit volume and revenue. and we plan to complete all U.S. migrations by mid-2026. Over the year, we identified incremental third-party spend and other internal savings to deliver our targeted savings for 2026 and allow additional time to complete U.S. credit migrations. In 26, we expect to deliver $35 million of operating expense savings and reduce capital expenditures to 6% of revenue. We will leverage these savings to drive margin expansion in 26 and fund growth investments. We anticipate no technology-related one-time expense add-backs in 2026. Next year, our technology modernization will shift to our international markets. We've launched TrueIQ analytic platform in Canada, the UK, and India in 2025. Next year, we plan to export other OneTrue-enabled solutions to these markets and start modernizing the core credit capabilities across Canada, the UK, and the Philippines. OneTrue is our destination platform, and we expect to fund these migrations through normal operations, driving additional savings in 2027 and beyond, while diffusing our innovative solutions globally. Our technology modernization is enabling commercial success across our solutions. We see new products rapidly gaining market traction, and we've built a robust innovation pipeline to fuel our next phase of growth. Factor Trust has delivered exceptional results. We secured multiple new wins in the quarter and continue to expand the pipeline. Factor Trust has been a key driver of outperformance in our consumer lending business throughout the year, and we anticipate roughly 20% growth from Factor Trust in 2025. TrueIQ data enrichment launched on Snowflake with the first few live customers. The Snowflake partnership expands the market opportunity for data enrichment and underscores our commitment to meet customers wherever their data lives. Data enrichment has quickly become one of our most successful recent product launches. In fraud, we experience strong demand for our newest synthetic fraud models and credit washing solutions. These new tools are built on OneTrue, and leverage our augmented identity graph, which now includes integrated public records and delivers better fraud signals. With OneTrue, we're beginning to penetrate the large and fast growing global market for advanced fraud analytics. We're accelerating growth in our marketing suite as well, driven by strong demand for our enhanced cloud-based identity resolution and audience activation capabilities. Over the last few years, we've streamlined our marketing suite down from 87 products across six separate platforms into a single integrated marketing platform on one true. This integrated solution improves performance and simplifies our product portfolio for sellers and customers. Trusted Call Solutions continues to scale with new customer wins and ongoing capability enhancements. We expect to deliver over 150 million in revenue in 2025, a 30% plus increase year over year. And we also continue to pursue global expansion opportunities for TCS. And in consumer solutions, our Framium model is increasing in users and offers available. We're also migrating our indirect customers globally onto a new platform that combines our credit education, identity protection, and financial offers behind a single set of APIs. OneTrue brings together our unique data within a single workflow platform, making it easier to deploy AI solutions across use cases and at scale. NTU is well positioned for AI-led growth. Our credit solutions are based on proprietary data contributed by thousands of individual furnishers. This data is not publicly available and can only be gathered and utilized within demanding regulatory frameworks. Our non-credit solutions also are developed from data gathered from tens of thousands of sources, many unique to TransUnion, and then combined with proprietary data exhaust from our fraud and marketing solutions. This vast array of data fuels our credit, fraud, and marketing predictive models, which already use advanced machine learning and AI to boost accuracy and to facilitate actions based on their better predictions. And increasingly, TransUnion will capture value with AI agents by performing work currently done by internal client teams or automation upstream from our data and analytics. And our most AI-enabled customers already consume more of our data than our traditional customers, and they adopt our newer solutions more rapidly. So we are actively leveraging AI across the enterprise to drive faster product development, to enhance customer experience, and improve ops efficiency. Internally, One True Assist and One True AI Studio are driving productivity gains for our software developers and data scientists, but also for non-technical teams. Within the One True Tech platform, agentic AI is enhancing core processes such as data onboarding, ID resolution, analytics, and delivery. And at the product level, we're embedding AI into our solutions, including role-based agents for true IQ analytics, our next-generation fraud detection models, and advanced consumer behavioral analytics in our marketing suite. So in summary, the tech modernization is driving rapid innovation and ops efficiency, but it's also positioning us to lead in the next phase of AI-driven growth. Our strong earnings and solid balance sheet have enabled us to boost capital returns for our shareholders. In the third quarter and October, we ramped up share repurchases to $160 million, increasing our total for the year to $200 million. This reflects our ongoing commitment to shareholder value. The Board recently raised our share repurchase authorization to $1 billion, and we believe buying back shares is especially attractive given our current market valuations. Now with that, I'll hand it over to Todd.