FactSet's Lower Margins, Flat Guidance Eclipse Earnings Beat

FactSet Research Systems Inc. (NYSE: FDS ) stock fell in Wednesday’s premarket session after the financial data and analytics provider reaffirmed its fiscal 2026 guidance, signaling limited upside despite posting third-quarter earnings and revenue that topped Wall Street estimates.

Investors also weighed a decline in operating margin during the quarter.

The company posted third-quarter revenue of $622.9 million, up 6.4% year over year and ahead of the analyst consensus estimate of $618.3 million.

Adjusted earnings came in at $4.53 per share, topping expectations of $4.46.

FactSet Revenue Growth Offsets Margin Pressure Organic revenue increased 7% year over year to $622.9 million.

Annual Subscription Value (ASV) reached $2.48 billion as of May 31, 2026, up from $2.34 billion a year earlier.

Organic ASV grew by $35.4 million during the quarter.

Adjusted operating margin declined to 34% from 36.8% a year earlier, reflecting higher compensation and technology-related expenses.

Shareholder Returns And AI Expansion FactSet returned $243.4 million to shareholders during the quarter, including $203.1 million through share repurchases and $40.3 million in dividends.

The company also raised its quarterly dividend by 6 cents to $1.16 per share, extending its dividend growth streak to 27 consecutive years on a stock split-adjusted basis.

FactSet ended the quarter with $288.1 million in cash and cash equivalents and $890.5 million in long-term debt.

CEO Sanoke Viswanathan said the results reflected strong execution and continued demand for the company’s content, analytics and workflow solutions.

He said clients are expanding their use of FactSet’s products, including its AI offerings, helping drive enterprise contract growth and strengthening confidence in long-term growth.

Separately, FactSet continues to expand its AI capabilities through its partnership with Alphabet Inc.’s (NASDAQ: GOOG ) (NASDAQ: GOOGL ) Google Cloud.

The companies are integrating Google’s Gemini models into FactSet Workstation and developing AI agents for portfolio operations, deal advisory and corporate finance.

Outlook Reaffirmed FactSet reaffirmed its fiscal 2026 adjusted EPS guidance of $17.25 to $17.75, compared with the analyst consensus estimate of $17.71.

The company also maintained its revenue outlook of $2.45 billion to $2.47 billion, versus the Street estimate of $2.463 billion.

FactSet also reiterated its forecast for organic ASV growth of $130 million to $160 million and an adjusted operating margin of 34% to 35.5%.

FactSet Price Action FDS Price Action: FactSet Research Systems shares were down 1.69% at $226.20 during premarket trading on Wednesday, according to Pro data.

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