FactSet (NYSE: FDS) reported results for its fiscal third quarter 2026 on July 1, posting revenues of $622.9 million for the period ended May 31, 2026, an increase of 6.4% from the prior year. The Norwalk, Connecticut-based company also reported organic revenue growth of 7% and reaffirmed its full-year fiscal 2026 guidance.
FactSet supplies financial data and analytics to the buy-side, sell-side, wealth management, private equity, and corporate sectors, serving more than 9,100 clients and over 247,000 individual users. The company, a member of the S&P 500, said growth in the quarter was driven by institutional buy-side and wealth management clients.
#Organic ASV Climbs 7.1% on Buy-Side and Wealth Management Demand
Organic annual subscription value, or ASV, reached $2,485.6 million at May 31, 2026, up $165 million or 7.1% year over year. Over the last three months, organic ASV increased $35.4 million, the company said.
ASV represents the forward-looking revenues for the next 12 months from all subscription services currently supplied to clients, according to the company. As reported ASV stood at $2,484.3 million at quarter end.
In the Americas, FactSet's largest region, organic ASV grew 7.2% year over year, with quarterly revenues of $407.2 million.
Asia Pacific was the fastest-growing region, with organic ASV up 10%, while EMEA grew 5.6%.
Enterprise renewals extended in length by 30% on average during the quarter, and annual ASV retention remained above 95%, the company said. FactSet also reported that more than 90% of its Top 50 clients now use four or more of its AI products, and that it added partnerships with Google Cloud, Finster AI, and TIFIN.AI during the quarter.
"FactSet's strong third quarter results reflect solid execution against our strategic priorities and continued demand for our differentiated content, analytics, and workflow solutions," Sanoke Viswanathan, Chief Executive Officer, FactSet, said in the earnings release.
#GAAP Operating Margin Falls to 26.7% on Higher Compensation Costs
GAAP operating margin declined to 26.7% from 33.2% in the prior year period, which the company attributed primarily to higher employee compensation costs, including one-time charges and CEO compensation costs not incurred a year earlier.
Adjusted operating margin, which excludes acquisition-related intangible asset amortization and non-recurring items, was 34%, compared with 36.8% in the prior year period, mainly due to higher compensation and technology-related expenses, the company said.
GAAP diluted earnings per share fell 9.6% to $3.50, driven by higher operating expenses including non-recurring items, partially offset by revenue growth and a 6% lower share count, according to the release.
Adjusted diluted EPS rose 6.1% to $4.53, which the company attributed to revenue growth and the lower share count.
Net cash provided by operating activities was $284.5 million for the quarter, an increase of 12.1% from the prior year period. Free cash flow rose 11.1% to $254 million.
FactSet also appointed Joshua B. Warren as Chief Financial Officer, effective April 13, 2026. Warren most recently served as CFO of Envestnet and previously held senior strategy roles at BlackRock.
#FactSet Returns $243.4 Million to Shareholders and Reaffirms Guidance
The company returned $243.4 million to shareholders during the third quarter, comprising $203.1 million in share repurchases and $40.3 million in dividends. Fiscal year to date, FactSet has deployed $628.7 million to shareholders.
FactSet repurchased 926,370 shares at an average price of $219.21 during the quarter. As of May 31, 2026, $494 million remained available under its share repurchase program.
The company increased its quarterly dividend by $0.06 to $1.16 per share, marking the twenty-seventh consecutive year it has increased dividends on a stock split-adjusted basis.
FactSet reaffirmed the fiscal 2026 outlook it provided on March 31, 2026, including GAAP revenues of $2,450 million to $2,470 million, organic ASV growth of $130 million to $160 million, GAAP diluted EPS of $14.85 to $15.35, and adjusted diluted EPS of $17.25 to $17.75.
Management reaffirmed those full-year targets while cautioning that the outlook reflects expectations as of July 1 and that actual results may differ materially given the risk factors, uncertainties, and assumptions detailed in the company's filings with the Securities and Exchange Commission. Declining margins remained a pressure point in the quarter, with the GAAP operating margin primarily affected by higher employee compensation costs, while the adjusted operating margin was impacted by higher compensation and technology-related expenses.