FACTSET RESH SYS INC earnings calls

M&A interest and data needs

Q (Alex Kramm · UBS): Is acquiring a competitor with proprietary data feasible or interesting now? Would it help consolidate costs and add data?

A: Management said they focus on organic growth and have a clear capital-allocation framework. They will consider high-return acquisitions that complement organic growth, and they are investing to expand proprietary data and meshing it with client data.

"But just to talk about our overall strategy, I think we see tremendous growth opportunities organically." — Sanoke Viswanathan (CEO)

How FactSet stands out with MCP

Q (Ashish Sabadra · RBC): With more MCP offerings from competitors and LLM bundles, how does FactSet differentiate and keep sales momentum?

A: Management said FactSet was early with API and MCP delivery and that their MCP quality and capabilities stand out. Adoption and usage are growing quickly, and they plan to publish many more data sets and capabilities beyond raw data.

"The quality, the capabilities that we deliver through our MCP is standing out in the market clearly." — Sanoke Viswanathan (CEO)

Agentic workstation and AI ASV contribution

Q (Shlomo Rosenbaum · Stifel): What will you show on Analyst Day about the agentic workstation? And was more than 10% of ASV growth from AI?

A: Management said Analyst Day will show product demos and the FactSet Intelligence strategy and that workflows are shifting to human-directed, agent-executed models. They confirmed more than 10% of ASV added in the quarter came from AI SKUs.

"We are moving into a world where workflows are transitioning from the traditional information consumption to human-directed but agent-executed workflows." — Sanoke Viswanathan (CEO)

ASV guide deceleration reasons

Q (Faiza Alwy · Deutsche Bank): Why guide to a deceleration from FY '26 into FY '27? Was anything pulled into FY '26?

A: Management said they had a strong Q4 driven by execution and confirmed they did not pull forward contracts into FY '26. They prefer to guide to a range they have high confidence in and let future performance drive revisions.

"We can confirm we did not pull forward anything into FY '26." — Sanoke Viswanathan (CEO)

BCC Group acquisition role

Q (Kelsey Zhu · Autonomous): How does the BCC acquisition fit strategy? Is FactSet moving into services or providing infrastructure?

A: Management said BCC opens new opportunities in real-time data distribution and helps FactSet offer a full-stack solution to displace incumbents. They described BCC as a technology business focused on routing, program execution and optimizing endpoint delivery, not a services business.

"We see this acquisition as a real unlock in opening up a lot of new opportunities for us." — Sanoke Viswanathan (CEO)

Relationship with frontier AI labs

Q (Toni Kaplan · Morgan Stanley): Do large LLM providers compete or complement FactSet? How does FactSet fit into the ecosystem?

A: Management said frontier lab marketplaces act as a strong channel and many clients adopt FactSet MCP through those connectors. They view the relationship as complementary and said context and client internal data drive continued demand for FactSet capabilities.

"Over the last several months, we have seen a rapid adoption of our MCP." — Sanoke Viswanathan (CEO)

Margin outlook and investments

Q (Manav Patnaik · Barclays): Where do modernization and security investments stand and will margins be pressured in '27 like in prior fast ASV growth periods?

A: Management said they made one-time foundational investments (multi-cloud, machine-ready data) and do not expect to repeat them this year. Productivity programs and simplifying the organization are delivering operating leverage, and they see a clear path to margin improvement in FY '27.

"We see a clear path to growth or improvement in margin in FY '27." — Sanoke Viswanathan (CEO)

Drivers of competitive displacements

Q (Andrew Nicholas · William Blair): What themes drove competitive wins and is implementation expertise a differentiator?

A: Management said implementation and context engineering via their consulting teams are a strong advantage that speeds ROI. They also said FactSet's full-stack, open and unbundled approach (data, analytics, workflows) is resonating and helps displace incumbents.

"We have, as you know, a full stack approach." — Sanoke Viswanathan (CEO)

Paid vs trial MCP conversion

Q (Curtis Nagle · BofA): Of the MCP client additions, how many are paid versus trials and how do conversion rates compare to 3Q?

A: Management said the MCP pipeline is fast-moving with trials converting quickly into larger contracts and workstation discussions. They see strong conversion rates and regularly sign 5- and 6-figure deals, and noted another approximate 20% expansion since the published numbers.

"It's broadly comparable in terms of the conversion pipeline." — Sanoke Viswanathan (CEO)

Pricing mix: subscription vs consumption

Q (Scott Wurtzel · Wolfe): How much of AI products are consumption-priced versus subscription, and is it product- or client-driven?

A: Management said it's very early in the shift from pure subscription to subscription plus consumption. Clients prefer a predictable subscription base with volume-based tiers above that, so contracts often mix both approaches as clients mature.

"it's very, very early days in the industry's transition from subscriptions to subscription plus consumption." — Sanoke Viswanathan (CEO)

How much revenue came from AI and token costs

Q (Craig Huber · Huber Research Partners): Can you quantify AI's help to revenue and its investment drag on profits? Also, what is the pure intangible amortization add-back?

A: Management said AI net-new products made a little more than 10% of the ASV added in Q4, specifically referencing $86 million of ASV added during the quarter. They also noted rising token consumption and costs are being monitored actively.

"that constituted about 10%, a little more than 10% of our Q4 flow as it were of the 100 -- or sorry, of the $86 million of ASV generated during the quarter." — Joshua Warren (CFO)

Will MCP last vs APIs

Q (Jason Haas · Wells Fargo): Some new models can use traditional APIs instead of MCP. Is MCP a lasting model or a passing trend?

A: Management said model types keep evolving and FactSet offers APIs, cloud shares and MCP and is prepared for trends to change. They partner with frontier labs and model providers to stay aligned with how clients consume data.

"We deliver data in multiple different formats, and we are prepared for that eventuality." — Sanoke Viswanathan (CEO)

Client feedback with more APIs and feeds

Q (Peter Knudsen · Evercore): As clients shift to APIs and direct feeds, can FactSet still capture client use patterns and feedback as before?

A: Management said the user base is evolving to a hybrid of human and agent use and that agent consumption via APIs and MCP still provides telemetry and feedback loops. Human context still accumulates via workstations while agent context accumulates through agent calls and APIs.

"And I would just encourage everybody to think about the user base itself evolving from human use to a hybrid of human and agent use." — Sanoke Viswanathan (CEO)

Product development speed and capacity

Q (Surinder Thind · Jefferies): How have product development capabilities changed, including headcount and token costs, and can clients absorb more releases?

A: Management said client absorption varies by maturity, with some clients adopting quickly and many in the middle doing experimentation. Internally they simplified into a unified product organization, which has increased pace and collaboration and led to shipping products faster.

"We've got a simplified, unified product organization. That's driving pace, that's driving clarity of vision, that's driving greater sharing and collaboration internally inside the company." — Sanoke Viswanathan (CEO)

Key swings for ASV guide range

Q (Keen Fai Tong · Goldman Sachs): What factors decide hitting low vs high end of 5%–6.5% organic ASV guidance?

A: Management said it's early in the year with 11 months of execution ahead and they based guidance on observed pipeline and prudent outlook. They pointed to strong execution in Q4 and back-half-weighted renewals as factors in their thinking.

"What you saw both in Q4 and really for the full year 2026 was excellent execution." — Joshua Warren (CFO)

Uplift from top clients using MCP

Q (Henry Hayden · Rothschild & Co Redburn): For top clients using MCP on a paid basis, how much incremental spending do you see and do you charge a premium for MCP?

A: Management did not disclose a specific premium metric but said MCP is typically bundled with other feeds, workstations and analytics. They said most workstation users who adopt MCP grow their overall ASV with FactSet by about 20% to 50% on average.

"On average, I think the majority of workstation users that have taken MCP from us have grown anywhere from 20% to 50% more in terms of their overall ASV with us." — Sanoke Viswanathan (CEO)

Tax rate and interest expense guidance

Q (Ashish Sabadra · RBC): How should we model the tax rate and interest expense for FY '27?

A: Management said FY '26 effective tax rate was approximately 19% and FY '25 was approximately 18%, and they think a slightly higher tax rate is reasonable for FY '27. They noted $500 million of notes maturing in March and that refinancing will likely be at higher rates.

"The effective tax rate was approximately 19% for FY '26." — Joshua Warren (CFO)

Incentive comp and metrics with consumption pricing

Q (Shlomo Rosenbaum · Stifel): With more consumption pricing, will incentive comp shift from ASV to revenue or other metrics?

A: Management said they made strong progress optimizing incentive design in FY '26 and will continue to refine it across multiple levers, including how consumption pricing affects incentives. They appointed a Workforce Transformation Officer and expect further improvements and disclosures in coming quarters.

"We made tremendous progress throughout FY '26 in optimizing our incentive design, and the results speak for themselves." — Sanoke Viswanathan (CEO)

Near-term ASV momentum and Q1 outlook

Q (Alex Kramm · UBS): Given MCP momentum and seasonality, do you feel confident about year-over-year ASV growth in Q1 and near term?

A: Management said the pipeline is robust, diverse and proportionate and that MCP growth continues to accelerate after quarter close. They said they feel very confident about the upcoming quarter at this point in the cycle.