FactSet Research Systems (NYSE: FDS), a leading financial data and analytics provider, released its first quarter fiscal 2025 results, showcasing resilient performance despite market headwinds. The company reported steady revenue growth and maintained stable earnings while continuing to invest in technological advancement and market expansion.
- Revenue reached $568.7 million, increasing 4.9% from Q1 2024
- Organic ASV grew 4.5% year-over-year to $2,258.8 million
- GAAP diluted EPS rose 1.3% to $3.89
- Adjusted diluted EPS increased 6.1% to $4.37
- Free cash flow decreased 56.4% to $60.5 million
FactSet’s client base expanded to 8,249, adding 32 new clients during the quarter. The user count increased by 1,886 to 218,267, primarily driven by growth in wealth management. The company maintained strong client relationships with an annual ASV retention rate exceeding 95% and a client retention rate of 91%.
Americas
The Americas segment remained the largest revenue contributor, generating $367.2 million with a 5.2% growth rate. Organic ASV in the region increased by 4.5% year-over-year.
EMEA
European operations delivered revenues of $143.8 million, showing a 2.7% increase from the previous year. The region’s organic ASV growth rate stood at 3.6%.
Asia Pacific
The Asia Pacific region demonstrated strong performance with revenues of $57.7 million, growing 6.2% year-over-year. The region’s organic ASV increased by 7.0%.
FactSet made significant strides in technological advancement during Q1:
- Launched the Intelligent Platform initiative incorporating conversational AI
- Released Internal Research Notes (IRN) 2.0 for buy-side and wealth professionals
- Acquired Irwin to enhance investor relations capabilities
- Established a strategic partnership with J.P. Morgan Securities Services
For fiscal 2025, FactSet projects:
- Organic ASV growth of $90-140 million
- GAAP revenues between $2,285-2,305 million
- GAAP operating margin of 32.5-33.5%
- Adjusted operating margin of 36.0-37.0%
- GAAP diluted EPS of $15.10-15.70
Positive Factors:
* Strong client retention rates above 95%
* Expanding wealth management sector
* Increased RFP activity (30% year-over-year growth)
* Successful AI integration and positive client feedback
Challenges:
* Significant decrease in free cash flow
* Operating margin pressure from increased costs
* Rising technology expenses
* Ongoing macroeconomic uncertainties
While FactSet maintains strong market positioning and client relationships, investors should monitor several key areas:
- Cash flow management given the sharp decline in free cash flow
- Operating margin pressure from increased technology investments
- Tax rate implications on future earnings
- Capital expenditure trends and their impact on financial flexibility
The company’s focus on innovation, particularly in AI integration and strategic partnerships, positions it well for future growth despite current challenges.
For detailed insights and analysis of FactSet’s Q1 2025 earnings, visit FactSet’s Q1 2025 Earnings Report Analysis.
