Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-Q
_________________________________________________
xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended February 28, 20222023
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______to ______

Commission File Number: 1-11869

FACTSET RESEARCH SYSTEMS INC.
(Exact name of registrant as specified in its charter)
fds-20230228_g1.jpg
_________________________________________________
Delaware13-3362547
(State or other jurisdiction of
incorporation)incorporation or organization)
(I.R.S. Employer
Identification No.)
45 Glover Avenue, Norwalk, Connecticut
06850
(Address of principal executive office)offices)(Zip Code)
Registrant’s telephone number, including area code: (203) 810-1000

Former name, former address and former fiscal year, if changed since last report: None

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbols(s)Name of each exchange on which registered
Common Stock, $0.01 Par ValueFDSNew York Stock Exchange LLC
The Nasdaq Stock Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer x   Accelerated filer ☐   Non-accelerated filer ☐   Smaller reporting company ☐   Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes No x
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:
The number of shares outstanding of the registrant’s common stock, $.01 par value, as of March 28, 2022 w27, 2023 waas 37,896,579.s 38,319,485.


Table of Contents
FactSet Research Systems Inc.
Form 10-Q
For the Quarter Ended February 28, 20222023
Index
Page
Consolidated Statements of Income for the three and six months ended February 28, 20222023 and 20212022
Consolidated Statements of Comprehensive Income for the three and six months ended February 28, 20222023 and 20212022
Consolidated Balance Sheets at February 28, 20222023 and August 31, 20212022
For additional information about FactSet Research Systems Inc. and access to its Annual Reports to Stockholders and Securities and Exchange Commission filings, free of charge, please visit FactSet’s website (https://investor.factset.com). Any information on or linked from the website is not incorporated by reference into this Quarterly Report on Form 10-Q.










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Special Note Regarding Forward-Looking Statements
FactSet Research Systems Inc. has made statements under the captions Part I, Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations, Part II, Item 1A. Risk Factors, and in other sections of this Quarterly Report on Form 10-Q for the three and six months ended February 28, 2022,2023, that are forward-looking statements. In some cases, you can identify these statements by words such as "may," "might," "will," "should," "expects," "plans," "anticipates," "believes," "estimates," "intends," "projects," "indicates," "predicts," "potential," or "continue," and similar expressions.
These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include projections of our future financial performance and anticipated trends in our business. These statements are only predictions based on our current expectations, estimates, forecasts and projections about future events. These statements are not guarantees of future performance and involve a number of risks, uncertainties and assumptions. There are many important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements, including the numerous factors discussed under Item 1A. Risk Factors in our Annual Report on Form 10-K for the fiscal year ended August 31, 2021,2022, that should be specifically considered.
Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. Forward-looking statements speak only as of the date they are made, and actual results could differ materially from those anticipated in forward-looking statements. We do not intend, and are under no duty, to update any of these forward-looking statements after the date of this Quarterly Report on Form 10-Q to reflect actual results, future events or circumstances, or revised expectations.
We intend that all forward-looking statements we make will be subject to safe harbor protection of the federal securities laws as found in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

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PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
FactSet Research Systems Inc.
CONSOLIDATED STATEMENTS OF INCOME – Unaudited
Three Months EndedSix Months EndedThree Months EndedSix Months Ended
February 28,February 28,February 28,
(In thousands, except per share data)2022202120222021
(in thousands, except per share data)(in thousands, except per share data)2023202220232022
RevenuesRevenues$431,119 $391,788 $855,844 $779,993 Revenues$515,085 $431,119 $1,019,900 $855,844 
Operating expensesOperating expensesOperating expenses
Cost of servicesCost of services199,395 195,523 406,544 383,611 Cost of services240,806 199,413 467,848 406,544 
Selling, general and administrativeSelling, general and administrative108,376 80,132 203,291 159,219 Selling, general and administrative104,582 98,066 210,178 189,304 
Asset impairmentsAsset impairments447 10,292 729 13,987 
Total operating expensesTotal operating expenses307,771 275,655 609,835 542,830 Total operating expenses345,835 307,771 678,755 609,835 
Operating incomeOperating income123,348 116,133 246,009 237,163 Operating income169,250 123,348 341,145 246,009 
Other income (expense), netOther income (expense), netOther income (expense), net
Interest expense, netInterest expense, net(1,673)(1,814)(3,167)(2,843)Interest expense, net(13,834)(1,673)(28,166)(3,167)
Other income (expense), netOther income (expense), net281 347 (956)578 Other income (expense), net1,346 281 1,668 (956)
Total other income (expense), netTotal other income (expense), net(12,488)(1,392)(26,498)(4,123)
Income before income taxesIncome before income taxes121,956 114,666 241,886 234,898 Income before income taxes156,762 121,956 314,647 241,886 
Provision for income taxesProvision for income taxes12,018 18,023 24,301 37,049 Provision for income taxes25,169 12,018 46,256 24,301 
Net incomeNet income$109,938 $96,643 $217,585 $197,849 Net income$131,593 $109,938 $268,391 $217,585 
Basic earnings per common shareBasic earnings per common share$2.91 $2.55 $5.77 $5.21 Basic earnings per common share$3.44 $2.91 $7.03 $5.77 
Diluted earnings per common shareDiluted earnings per common share$2.84 $2.50 $5.63 $5.12 Diluted earnings per common share$3.38 $2.84 $6.89 $5.63 
Basic weighted average common sharesBasic weighted average common shares37,837 37,916 37,685 37,961 Basic weighted average common shares38,281 37,837 38,201 37,685 
Diluted weighted average common sharesDiluted weighted average common shares38,761 38,620 38,628 38,658 Diluted weighted average common shares38,981 38,761 38,947 38,628 
The accompanying notes are an integral part of these Consolidated Financial Statements.










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FactSet Research Systems Inc.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME – Unaudited
Three Months EndedSix Months EndedThree Months EndedSix Months Ended
February 28,February 28,February 28,
(In thousands)2022202120222021
(in thousands)(in thousands)2023202220232022
Net incomeNet income$109,938 $96,643 $217,585 $197,849 Net income$131,593 $109,938 $268,391 $217,585 
Other comprehensive income (loss), net of taxOther comprehensive income (loss), net of taxOther comprehensive income (loss), net of tax
Net unrealized gain on cash flow hedges*4,805 1,303 4,810 1,187 
Foreign currency translation adjustment (losses) gains(2,983)9,277 (21,696)9,610 
Net unrealized gain (loss) on cash flow hedges*Net unrealized gain (loss) on cash flow hedges*(2,254)4,805 4,301 4,810 
Foreign currency translation adjustment gains (losses)Foreign currency translation adjustment gains (losses)3,070 (2,983)11,839 (21,696)
Other comprehensive income (loss)Other comprehensive income (loss)1,822 10,580 (16,886)10,797 Other comprehensive income (loss)816 1,822 16,140 (16,886)
Comprehensive incomeComprehensive income$111,760 $107,223 $200,699 $208,646 Comprehensive income$132,409 $111,760 $284,531 $200,699 
*ForPresented net of a tax benefit of $779 thousand and a tax expense of $468 thousand for the three and six months ended February 28, 2023 and February 28, 2022, the net unrealized gain on cash flow hedges wererespectively. Presented net of a tax expense of $468$1,485 thousand and a tax expense of $469 thousand respectively. Forfor the three and six months ended February 28, 2021, the net unrealized gain on cash flow hedges were net of a tax expense of $441 thousand2023 and a tax expense of $400 thousand,February 28, 2022, respectively.

The accompanying notes are an integral part of these Consolidated FinancialFinancial Statements.

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FactSet Research Systems Inc.
CONSOLIDATED BALANCE SHEETS – Unaudited
(In thousands, except share data)February 28, 2022August 31, 2021
(in thousands, except share data)(in thousands, except share data)February 28, 2023August 31, 2022
ASSETSASSETSASSETS
Cash and cash equivalentsCash and cash equivalents$773,012 $681,865 Cash and cash equivalents$445,326 $503,273 
InvestmentsInvestments34,984 35,984 Investments32,022 33,219 
Accounts receivable, net of reserves of $4,263 at February 28, 2022 and $6,431 at August 31, 2021188,308 151,187 
Accounts receivable, net of reserves of $3,120 at February 28, 2023 and $2,776 at August 31, 2022Accounts receivable, net of reserves of $3,120 at February 28, 2023 and $2,776 at August 31, 2022257,408 204,102 
Prepaid taxesPrepaid taxes36,569 13,917 Prepaid taxes41,605 38,539 
Prepaid expenses and other current assetsPrepaid expenses and other current assets57,786 50,625 Prepaid expenses and other current assets82,293 91,214 
Total current assetsTotal current assets1,090,659 933,578 Total current assets858,654 870,347 
Property, equipment and leasehold improvements, netProperty, equipment and leasehold improvements, net114,789 131,377 Property, equipment and leasehold improvements, net81,790 80,843 
GoodwillGoodwill786,172 754,205 Goodwill977,359 965,848 
Intangible assets, netIntangible assets, net135,042 134,986 Intangible assets, net1,869,774 1,895,909 
Deferred taxesDeferred taxes2,169 2,250 Deferred taxes5,662 3,153 
Lease right-of-use assets, netLease right-of-use assets, net206,237 239,064 Lease right-of-use assets, net150,174 159,458 
Other assetsOther assets39,089 29,480 Other assets57,662 38,747 
TOTAL ASSETSTOTAL ASSETS$2,374,157 $2,224,940 TOTAL ASSETS$4,001,075 $4,014,305 
LIABILITIESLIABILITIESLIABILITIES
Accounts payable and accrued expensesAccounts payable and accrued expenses$90,262 $85,777 Accounts payable and accrued expenses$120,223 $108,395 
Current lease liabilitiesCurrent lease liabilities31,010 31,576 Current lease liabilities28,573 29,185 
Accrued compensationAccrued compensation68,749 104,403 Accrued compensation63,720 114,808 
Deferred revenuesDeferred revenues72,152 63,104 Deferred revenues164,190 152,039 
Dividends payableDividends payable31,065 30,845 Dividends payable34,099 33,860 
Total current liabilitiesTotal current liabilities293,238 315,705 Total current liabilities410,805 438,287 
Long-term debtLong-term debt574,625 574,535 Long-term debt1,735,609 1,982,424 
Deferred taxesDeferred taxes15,018 14,752 Deferred taxes6,600 8,800 
Deferred revenues, non-currentDeferred revenues, non-current7,233 8,394 Deferred revenues, non-current6,137 7,212 
Taxes payableTaxes payable31,002 30,279 Taxes payable34,825 34,211 
Long-term lease liabilitiesLong-term lease liabilities233,275 259,980 Long-term lease liabilities196,669 208,622 
Other liabilitiesOther liabilities3,785 4,942 Other liabilities3,276 3,341 
TOTAL LIABILITIESTOTAL LIABILITIES$1,158,176 $1,208,587 TOTAL LIABILITIES$2,393,921 $2,682,897 
Commitments and contingencies (see Note 12)Commitments and contingencies (see Note 12)00Commitments and contingencies (see Note 12)
STOCKHOLDERS’ EQUITYSTOCKHOLDERS’ EQUITYSTOCKHOLDERS’ EQUITY
Preferred stock, $0.01 par value, 10,000,000 shares authorized, none issuedPreferred stock, $0.01 par value, 10,000,000 shares authorized, none issued$— $— Preferred stock, $0.01 par value, 10,000,000 shares authorized, none issued$— $— 
Common stock, $0.01 par value, 150,000,000 shares authorized, 41,485,261 and 41,163,192 shares issued, 37,883,866 and 37,615,419 shares outstanding at February 28, 2022 and August 31, 2021, respectively415 412 
Common stock, $0.01 par value; 150,000,000 shares authorized; 41,949,883 and 41,653,218 shares issued; 38,313,708 and 38,044,756 shares outstanding at February 28, 2023 and August 31, 2022, respectivelyCommon stock, $0.01 par value; 150,000,000 shares authorized; 41,949,883 and 41,653,218 shares issued; 38,313,708 and 38,044,756 shares outstanding at February 28, 2023 and August 31, 2022, respectively420 417 
Additional paid-in capitalAdditional paid-in capital1,131,166 1,048,305 Additional paid-in capital1,261,452 1,190,350 
Treasury stock, at cost: 3,601,395 and 3,547,773 shares at February 28, 2022 and August 31, 2021, respectively(927,814)(905,917)
Treasury stock, at cost: 3,636,175 and 3,608,462 shares at February 28, 2023 and August 31, 2022, respectivelyTreasury stock, at cost: 3,636,175 and 3,608,462 shares at February 28, 2023 and August 31, 2022, respectively(942,496)(930,715)
Retained earningsRetained earnings1,068,062 912,515 Retained earnings1,380,021 1,179,739 
Accumulated other comprehensive lossAccumulated other comprehensive loss(55,848)(38,962)Accumulated other comprehensive loss(92,243)(108,383)
TOTAL STOCKHOLDERS’ EQUITYTOTAL STOCKHOLDERS’ EQUITY$1,215,981 $1,016,353 TOTAL STOCKHOLDERS’ EQUITY$1,607,154 $1,331,408 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITYTOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY$2,374,157 $2,224,940 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY$4,001,075 $4,014,305 
The accompanying notes are an integral part of these Consolidated Financial Statements.
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FactSet Research Systems Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS Unaudited
Six Months EndedSix Months Ended
February 28,February 28,
(in thousands)(in thousands)20222021(in thousands)20232022
CASH FLOWS FROM OPERATING ACTIVITIESCASH FLOWS FROM OPERATING ACTIVITIESCASH FLOWS FROM OPERATING ACTIVITIES
Net incomeNet income$217,585 $197,849 Net income$268,391 $217,585 
Adjustments to reconcile net income to net cash provided by operating activitiesAdjustments to reconcile net income to net cash provided by operating activitiesAdjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortizationDepreciation and amortization32,827 30,962 Depreciation and amortization52,208 32,827 
Amortization of lease right-of-use assetsAmortization of lease right-of-use assets22,172 21,517 Amortization of lease right-of-use assets19,596 22,172 
Stock-based compensation expenseStock-based compensation expense25,937 22,327 Stock-based compensation expense27,500 25,937 
Deferred income taxesDeferred income taxes(3,264)(2,802)Deferred income taxes(6,470)(3,264)
Impairment charge13,987 — 
Asset impairmentsAsset impairments729 13,987 
Changes in assets and liabilities, net of effects of acquisitionsChanges in assets and liabilities, net of effects of acquisitionsChanges in assets and liabilities, net of effects of acquisitions
Accounts receivable, net of reservesAccounts receivable, net of reserves(37,704)(15,421)Accounts receivable, net of reserves(54,294)(37,704)
Accounts payable and accrued expensesAccounts payable and accrued expenses10,183 (724)Accounts payable and accrued expenses12,102 10,183 
Accrued compensationAccrued compensation(34,680)(20,879)Accrued compensation(51,714)(34,680)
Deferred fees6,201 12,445 
Deferred revenuesDeferred revenues11,069 6,201 
Taxes payable, net of prepaid taxesTaxes payable, net of prepaid taxes(21,824)16,688 Taxes payable, net of prepaid taxes(2,576)(21,824)
Lease liabilities, netLease liabilities, net(23,863)(20,549)Lease liabilities, net(22,877)(23,863)
Other, netOther, net(12,605)(11,477)Other, net17,650 (12,605)
Net cash provided by operating activitiesNet cash provided by operating activities194,952 229,936 Net cash provided by operating activities271,314 194,952 
CASH FLOWS FROM INVESTING ACTIVITIESCASH FLOWS FROM INVESTING ACTIVITIESCASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, equipment, leasehold improvements and internal-use software(20,546)(28,758)
Purchases of property, equipment, leasehold improvements and capitalized internal-use softwarePurchases of property, equipment, leasehold improvements and capitalized internal-use software(35,416)(20,546)
Acquisition of businesses, net of cash and cash equivalents acquiredAcquisition of businesses, net of cash and cash equivalents acquired(50,018)(41,916)Acquisition of businesses, net of cash and cash equivalents acquired— (50,018)
Purchases of investmentsPurchases of investments(250)(1,250)Purchases of investments(10,889)(250)
Proceeds from maturity or sale of investments— 2,176 
Net cash used in investing activities(70,814)(69,748)
Net cash provided by (used in) investing activitiesNet cash provided by (used in) investing activities(46,305)(70,814)
CASH FLOWS FROM FINANCING ACTIVITIESCASH FLOWS FROM FINANCING ACTIVITIESCASH FLOWS FROM FINANCING ACTIVITIES
Repurchases of common stock(18,639)(114,640)
Repayment of debtRepayment of debt(250,000)— 
Dividend paymentsDividend payments(61,448)(58,186)Dividend payments(67,478)(61,448)
Proceeds from employee stock plansProceeds from employee stock plans56,928 28,526 Proceeds from employee stock plans43,605 56,928 
Repurchases of common stockRepurchases of common stock— (18,639)
Other financing activitiesOther financing activities(3,258)(2,359)Other financing activities(11,781)(3,258)
Net cash used by financing activities(26,417)(146,659)
Net cash provided by (used in) financing activitiesNet cash provided by (used in) financing activities(285,654)(26,417)
Effect of exchange rate changes on cash and cash equivalentsEffect of exchange rate changes on cash and cash equivalents(6,574)3,550 Effect of exchange rate changes on cash and cash equivalents2,698 (6,574)
Net increase in cash and cash equivalents91,147 17,079 
Net increase (decrease) in cash and cash equivalentsNet increase (decrease) in cash and cash equivalents(57,947)91,147 
Cash and cash equivalents at beginning of periodCash and cash equivalents at beginning of period681,865 585,605 Cash and cash equivalents at beginning of period503,273 681,865 
Cash and cash equivalents at end of periodCash and cash equivalents at end of period$773,012 $602,684 Cash and cash equivalents at end of period$445,326 $773,012 
The accompanying notes are an integral part of these Consolidated Financial Statements.

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FactSet Research Systems Inc.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY- Unaudited
For the Three Months Ended February 28, 20222023
(in thousands, except share data)(in thousands, except share data)Common StockAdditional
Paid-in
Capital
Treasury StockRetained
Earnings
Accumulated
Other
Comprehensive
Loss
Total
Stockholders’
Equity
(in thousands, except share data)Common StockAdditional
Paid-in
Capital
Treasury StockRetained
Earnings
Accumulated
Other
Comprehensive Loss
Total
Stockholders’
Equity
SharesPar ValueSharesAmountSharesPar ValueSharesAmount
Balance as of November 30, 202141,372,890 $414 $1,094,467 3,600,720 $(927,505)$989,189 $(57,670)$1,098,895 
Balance as of November 30, 2022Balance as of November 30, 202241,848,430 $418 $1,225,947 3,634,322 $(941,705)$1,282,527 $(93,059)$1,474,128 
Net incomeNet income109,938 109,938 Net income131,593 131,593 
Other comprehensive loss1,822 1,822 
Other comprehensive income (loss)Other comprehensive income (loss)816 816 
Common stock issued for employee stock plansCommon stock issued for employee stock plans111,360 21,163 260 (128)21,036 Common stock issued for employee stock plans95,543 20,180 20,181 
Vesting of restricted stockVesting of restricted stock1,011 — 415 (181)(181)Vesting of restricted stock5,910 1,853 (791)(790)
Repurchases of common stock00— 
Stock-based compensation15,536 15,536 
Stock-based compensation expenseStock-based compensation expense15,325 15,325 
Dividends declaredDividends declared(31,065)(31,065)Dividends declared(34,099)(34,099)
Balance as of February 28, 202241,485,261 $415 $1,131,166 3,601,395 $(927,814)$1,068,062 $(55,848)$1,215,981 
Balance as of February 28, 2023Balance as of February 28, 202341,949,883 $420 $1,261,452 3,636,175 $(942,496)$1,380,021 $(92,243)$1,607,154 
For the Six Months Ended February 28, 2022
For the Six Months Ended February 28, 2023For the Six Months Ended February 28, 2023
(in thousands, except share data)(in thousands, except share data)Common StockAdditional
Paid-in
Capital
Treasury StockRetained
Earnings
Accumulated
Other
Comprehensive
Loss
Total
Stockholders’
Equity
(in thousands, except share data)Common StockAdditional
Paid-in
Capital
Treasury StockRetained
Earnings
Accumulated
Other
Comprehensive
Loss
Total
Stockholders’
Equity
SharesPar ValueSharesAmountSharesPar ValueSharesAmount
Balance as of August 31, 202141,163,192 $412 $1,048,305 3,547,773 $(905,917)$912,515 $(38,962)$1,016,353 
Balance as of August 31, 2022Balance as of August 31, 202241,653,218 $417 $1,190,350 3,608,462 $(930,715)$1,179,739 $(108,383)$1,331,408 
Net incomeNet income217,585 217,585 Net income268,391 268,391 
Other comprehensive income(16,886)(16,886)
Other comprehensive income (loss)Other comprehensive income (loss)16,140 16,140 
Common stock issued for employee stock plansCommon stock issued for employee stock plans303,709 56,924 260 (128)56,799 Common stock issued for employee stock plans226,966 43,602 410 (166)43,438 
Vesting of restricted stockVesting of restricted stock18,360 — 7,162 (3,130)(3,130)Vesting of restricted stock69,699  27,303 (11,615)(11,614)
Repurchases of common stock46,200 (18,639)(18,639)
Stock-based compensation25,937 25,937 
Stock-based compensation expenseStock-based compensation expense27,500 27,500 
Dividends declaredDividends declared(62,038)(62,038)Dividends declared(68,109)(68,109)
Balance as of February 28, 202241,485,261 $415 $1,131,166 3,601,395 $(927,814)$1,068,062 $(55,848)$1,215,981 
Balance as of February 28, 2023Balance as of February 28, 202341,949,883 $420 $1,261,452 3,636,175 $(942,496)$1,380,021 $(92,243)$1,607,154 



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For the Three Months Ended February 28, 20212022
(in thousands, except share data)(in thousands, except share data)Common StockAdditional
Paid-in
Capital
Treasury StockRetained
Earnings
Accumulated
Other
Comprehensive
Loss
Total
Stockholders’
Equity
(in thousands, except share data)Common StockAdditional
Paid-in
Capital
Treasury StockRetained
Earnings
Accumulated
Other
Comprehensive
Loss
Total
Stockholders’
Equity
SharesPar ValueSharesAmountSharesPar ValueSharesAmount
Balance as of November 30, 202040,884,113 $409 $968,375 2,875,984 $(682,224)$705,089 $(39,076)$952,573 
Balance as of November 30, 2021Balance as of November 30, 202141,372,890 $414 $1,094,467 3,600,720 $(927,505)$989,189 $(57,670)$1,098,895 
Net incomeNet income96,643 96,643 Net income109,938 109,938 
Other comprehensive income10,580 10,580 
Other comprehensive income (loss)Other comprehensive income (loss)1,822 1,822 
Common stock issued for employee stock plansCommon stock issued for employee stock plans58,550 — 10,533 318 (104)10,429 Common stock issued for employee stock plans111,360 21,163 260 (128)21,036 
Vesting of restricted stockVesting of restricted stock997 — 401 (131)(131)Vesting of restricted stock1,011 — 415 (181)(181)
Repurchases of common stock221,959 (71,495)(71,495)
Stock-based compensation11,010 11,010 
Stock-based compensation expenseStock-based compensation expense15,536 15,536 
Dividends declaredDividends declared(29,141)(29,141)Dividends declared(31,065)(31,065)
Balance as of February 28, 202140,943,660 $409 $989,918 3,098,662 $(753,954)$772,591 $(28,496)$980,468 
Balance as of February 28, 2022Balance as of February 28, 202241,485,261 $415 $1,131,166 3,601,395 $(927,814)$1,068,062 $(55,848)$1,215,981 
For the Six Months Ended February 28, 2021
For the Six Months Ended February 28, 2022For the Six Months Ended February 28, 2022
(in thousands, except share data)(in thousands, except share data)Common StockAdditional
Paid-in
Capital
Treasury StockRetained
Earnings
Accumulated
Other
Comprehensive
Loss
Total
Stockholders’
Equity
(in thousands, except share data)Common StockAdditional
Paid-in
Capital
Treasury StockRetained
Earnings
Accumulated
Other
Comprehensive
Loss
Total
Stockholders’
Equity
SharesPar ValueSharesAmountSharesPar ValueSharesAmount
Balance as of August 31, 202040,767,708 $408 $939,067 2,737,456 $(636,956)$633,149 $(39,293)$896,375 
Balance as of August 31, 2021Balance as of August 31, 202141,163,192 $412 $1,048,305 3,547,773 $(905,917)$912,515 $(38,962)$1,016,353 
Net incomeNet income197,849 197,849 Net income217,585 217,585 
Other comprehensive lossOther comprehensive loss10,797 10,797 Other comprehensive loss(16,886)(16,886)
Common stock issued for employee stock plansCommon stock issued for employee stock plans157,009 28,524 318 (104)28,421 Common stock issued for employee stock plans303,709 56,924 260 (128)56,799 
Vesting of restricted stockVesting of restricted stock18,943 — 7,129 (2,254)(2,254)Vesting of restricted stock18,360 — 7,162 (3,130)(3,130)
Repurchases of common stockRepurchases of common stock353,759 (114,640)(114,640)Repurchases of common stock46,200 (18,639)(18,639)
Stock-based compensation22,327 22,327 
Stock-based compensation expenseStock-based compensation expense25,937 25,937 
Dividends declaredDividends declared(58,407)(58,407)Dividends declared(62,038)(62,038)
Balance as of February 28, 202140,943,660 $409 $989,918 3,098,662 $(753,954)$772,591 $(28,496)$980,468 
Balance as of February 28, 2022Balance as of February 28, 202241,485,261 $415 $1,131,166 3,601,395 $(927,814)$1,068,062 $(55,848)$1,215,981 
The accompanying notes are an integral part of these Consolidated Financial Statements.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FactSet Research Systems Inc.
February 28, 20222023
(Unaudited)
Page
Recent Accounting PronouncementsRevenue Recognition
Revenue Recognition
Note 5Fair Value Measures
Derivative Instruments
Acquisition
Goodwill
Note 9Income Taxes
Note 10Leases
Commitments and Contingencies
Stockholders' Equity
Earnings Per Share
Stock-Based Compensation
Note 16Segment Information
Subsequent EventStock-Based Compensation

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1. DESCRIPTION OF BUSINESS
FactSet Research Systems Inc. and its wholly-owned subsidiaries (collectively, "we," "our," "us," the "Company" or "FactSet") is a global financial datadigital platform and analytics companyenterprise solutions provider with an open and flexible digital platform which focuses on drivingsolutions that drive the investment community to see more, think bigger and do its best work. Our strategy is to build the leading open content and analytics platform that delivers a differentiated advantage for our clients’ success.
For over 40 years,Fiscal 2023 marks the FactSet45th year our platform has delivered expansive data, sophisticated analytics and flexible technology thatused by global financial professionals need to power their critical investment workflows. MoreAs of February 28, 2023, we had more than171,000 7,700 clients comprised of approximately 186,000 investment professionals, including asset managers, asset owners, bankers, wealth managers, asset owners, channel partners, hedge funds, corporate users, private equity and venture capital professionals,professionals. Our on- and others use our personalizedoff-platform solutions to identify opportunities, explore ideas, and gain a competitive advantage. Our solutions span the investment lifecycle including investment research, portfolio construction and analysis, trade execution, performance measurement, risk management and reporting across the investment lifecycle.reporting. Our revenues are primarily derived from subscriptions to our multi-asset class data and solutions powered by our connected content, referred to as our "content refinery." Our products and services include workstations, portfolio analytics and enterprise solutions.
We provide financial data and market intelligence on securities, companies, industries and people to enable our clients to research investment ideas, as well as offering them the capabilities to analyze, monitor and manage their portfolios. We combine dedicated client service with open and flexible technology offerings, such asincluding a configurable desktop and mobile platform, comprehensive data feeds, cloud-based digital solutions and application programming interfaces ("APIs"). Our revenues are primarily derived from subscriptions to our productsCUSIP Global Services ("CGS") business supports security master files relied on by the investment industry for critical front, middle and services such as workstations, portfolio analytics, and market data.back office functions.
We advancedrive our industry by comprehensivelybusiness based on our detailed understanding of our clients’ workflows, solvingwhich helps us to solve their most complex challenges, and helping them achieve their goals. By providingchallenges. We provide them with the leadingan open contentdigital platform, connected and analytics platform, an expansive universe of concordedreliable data, they can trust, next-generation workflow support designed to help them growsolutions and see their next best action, and the industry’s mosthighly committed service specialists, we put our clients in a position to outperform.specialists.
We are focused on growingoperate our business through 3three reportable segments ("segments"): the Americas, EMEA and Asia Pacific. Refer to Note 16, Segment Information, for further information. Withindiscussion. For each of our segments, we deliver insight and informationexecute our strategy through our 3 workflows: three workflow solutions: Research & Advisory Solutions;Advisory; Analytics & Trading Solutions;Trading; and Content & Technology Solutions ("CTS").
2. BASISSUMMARY OF PRESENTATIONSIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
We conduct business globally and manage our business on a geographic basis. The accompanying unaudited Consolidated Financial Statements and Notes to the Consolidated Financial Statements included in this Quarterly Report on Form 10-Q are prepared in accordance with generally accepted accounting principles in the United States ("GAAP") for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and footnotes required by GAAP for annual financial statements,statements; as such, the information in this Quarterly Report on Form 10-Q should be read in conjunction with the audited Consolidated Financial Statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended August 31, 2021.2022. The accompanying unaudited Consolidated Financial Statements include our accounts and those of our wholly-owned subsidiaries; all intercompany activity and balances have been eliminated.
In the opinion of management, the accompanying unaudited Consolidated Financial Statements include all normal recurring adjustments, transactions or events discretely impacting the interim periods considered necessary to present fairly our results of operations,operations, financial position, cash flows and equity.
We have evaluated subsequent events throughReclassifications
In the dateConsolidated Statements of issuanceIncome, we reclassified comparative figures for the three and six months ended February 28, 2022 from both Selling, general and administrative and Cost of services to Asset impairments, primarily related to the financial statements included in this Quarterly Report on Form 10-Q, referimpairment of our lease right-of-use ("ROU") assets and property, equipment and leasehold improvements, to Note 17, Subsequent Events for more information.conform to the current year's presentation.
Use of Estimates
The preparation of our Consolidated Financial Statements and related disclosures in conformity with GAAP, requiresrequired management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of
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contingent assets and liabilities at the date of the financial statements and the reported amountamounts of revenues and expenses during the reporting period. Significant estimates may have been made in areas that include income taxes, stock-based compensation, the valuation of goodwill and allocation of purchase price to acquiredintangible assets, business combinations, long-lived assets, contingencies and liabilities, useful lives and impairments of
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long-lived tangible and intangible assets and reserves for litigation and other contingencies.impairment assessments. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from those estimates.
Concentrations of Credit Risks
3.RECENTACCOUNTING PRONOUNCEMENTSCash equivalents
AsFinancial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents. We are exposed to credit risk for cash and cash equivalents held in financial institutions in the event of a default, to the extent that such amounts are in excess of applicable insurance limits. We have not experienced any losses from maintaining cash accounts in excess of such limits. We do not believe our concentration of cash and cash equivalents presents a significant credit risk as the counterparties to the instruments consist of multiple high-quality, credit-worthy financial institutions.
Accounts Receivable
Our accounts receivable credit risk is dependent upon the financial stability of our individual clients; however, this risk is generally limited due to our large and geographically dispersed client base. No single client represented more than 3% of our total subscription revenues in any period presented. The receivable reserve was $3.1 million and $2.8 million as of February 28, 2023 and August 31, 2022, respectively. We do not require collateral from our clients.
Derivative Instruments
Our use of derivative instruments exposes us to credit risk to the extent counterparties may be unable to meet the terms of their agreements. To mitigate credit risk, we implemented all applicablelimit counterparties to credit-worthy financial institutions and use several institutions to reduce concentration risk. We do not expect any losses as a result of default by our counterparties.
Concentrations ofData Providers
We integrate data from various third-party sources into our hosted proprietary data and analytics platform, which our clients access to perform their analyses. As certain data sources have a limited number of suppliers, we make every effort to assure that, where reasonable, alternative sources are available. We are not dependent on any individual third-party data supplier in order to meet the needs of our clients, with only two data suppliers each representing more than 10% of our total data costs for the six months ended February 28, 2023.
Recently Adopted Accounting Pronouncements
We did not adopt any new accounting standards andor updates issued by the Financial Accounting Standards Board ("FASB") that were in effect. There were no new standards or updates adopted during the three and six months ended February 28, 20222023 that had a material impact on our Consolidated Financial Statements.
New Accounting Standards or Updates Recently Adopted 
Income Tax Simplification
In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740); Simplifying the Accounting for Income Taxes, to simplify various aspects related to accounting for income taxes, eliminating certain exceptions to the general principles in accounting for income taxes related to intraperiod tax allocation, simplifying when companies recognize deferred taxes in an interim period, and clarifying certain aspects of the current guidance to promote consistent application. We have adopted this standard effective September 1, 2021. The adoption of this standard did not have an impact on our Consolidated Financial Statements.
Business Combinations
In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”), which requires an acquirer to recognize and measure contract assets and liabilities acquired in a business combination in accordance with Revenue from Contracts with Customers (“Topic 606”) rather than adjust them to fair value at the acquisition date. We elected to early adopt this accounting standard in the second quarter of fiscal 2022, with retrospective application to business combinations that occurred in the current fiscal year. Results of operations for quarterly periods prior to September 1, 2021 remain unchanged as a result of the adoption of ASU No. 2021-08. The acquisition of Cobalt Software, Inc (“Cobalt”), and all future acquisitions, will be accounted for in accordance with ASU 2021-08. Refer to Note 7. Acquisition for further information. The adoption of this standard did not have a material impact on our Consolidated Financial Statements.
Recent Accounting Standards or UpdatesPronouncements Not Yet EffectiveAdopted
Facilitation of the Effects of Reference Rate Reform on Financial Reporting
In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848); Facilitation of the Effects of Reference Rate Reform on Financial Reporting, to provide optional expedients and exceptions for applying GAAP to contract modifications, hedging relationships, and other transactions affected by the anticipated transition from LIBOR. As a result of the reference rate reform initiative, certain widely used reference rates such as LIBOR are expected to be discontinued. The guidance is designed to simplify how entities account for contracts, such as receivables, debt, leases, derivative instruments and hedging, that are modified to replace LIBOR or other benchmark interest rates with new rates. The guidance is effective upon issuance and may be applied through December 31, 2022.
On March 1, 2022, we repaid in full and terminated the 2019 Credit Agreement, which bore interest based on the LIBOR rate. Concurrently, on March 1, 2022, FactSet Research Systems Inc. entered into the 2022 Credit Agreement, which bears interest based on the Secured Overnight Financing Rate ("SOFR") rate. The adoption of this standard will not have an impact on our Consolidated Financial Statements. Refer to Note 11, Debt andNote 17, Subsequent Events for definitions of these terms and more information on the 2019 Credit Agreement and 2022 Credit Agreement.
No otherThere were no new accounting pronouncements issued or effective as of February 28, 2022 have2023 that had, or are expected to have, a material impact on our Consolidated Financial Statements.
4.3. REVENUE RECOGNITION
We derive most of our revenues by providing client access to our hosted proprietary data and analytics platform which can include various combinations of products and services availablemulti-asset class solutions, powered by our content refinery, over the associated contractual term.term (referred to as the "Hosted Platform"). The hosted platformHosted Platform is a subscription-based service that consists primarily of providingprovides client access to various combinations of products and services including workstations, portfolio analytics and market data. enterprise solutions. In addition, through our CGS platform, we provide subscription access to a database of universally recognized identifiers, enabling differentiating characteristics for issuers and their financial instruments (referred to as the "Identifier Platform").
We determined that the majority of each of our subscription-based serviceHosted Platform and Identifier Platform services represents a single performance obligation covering a series of distinct products and services that are substantially the same and that have the same pattern of
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transfer to the client. We also determined the primary nature of the promise to the client is to provide daily access to one overalleach of these data and analytics platform. This platform providesplatforms. These platforms provide integrated financial information, analytical applications and industry-leading service for the investment community. Based on the nature of the services and products offered by us,these platforms, we apply an output time-based measure of progress as the client is simultaneously receiving and consuming the
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benefits of the platform. We record revenuesrecognize revenue for the majority of these platforms in accordance with the 'as invoiced' practical expedient as the amount of consideration that we have the right to invoice corresponds directly with the value of our contracts using the over-time revenue recognition model as a client is invoiced or performance is satisfied. to date.
We do not consider payment terms as a performance obligation for clients with contractual terms that are one year or less and we have elected the practical expedient.
Contracts with clients can include certain fulfillment costs, comprised of up-front costs to allow for the delivery of servicesproducts and products,services, which are recoverable. In connection with the adoption of the revenue recognition standard, fulfillmentFulfillment costs are recognized as an asset, with the current portion recorded in the Prepaid expenses and other current assets and the non-current portion recorded in Other assets in the Consolidated Balance Sheets, based on the term of the license period. The fulfillment costs are amortized consistent with the associated revenues for providing the services. There are no significant judgments that would impact the timing of revenue recognition.
The majority of client contracts have a duration of one year or less, or the amount we are entitled to receive corresponds directly with the value of performance obligations completed to date, and therefore, we do not disclose the value of the remaining unsatisfied performance obligations. 
Disaggregated Revenues 
We disaggregate revenues from contracts with clients by our reportable segments ("segments") which consist of the Americas, EMEA and Asia Pacific. We believe these segments are reflective of how we manage our business and the markets in which we serve and best depict the nature, amount, timing and uncertainty of revenues and cash flows related to contracts with clients. Segment revenues reflect sales to our clients based on their respective geographic locations. Refer to Note 16, Segment Information, for further information. 
The following table presents this disaggregation by segment:
Three Months EndedSix Months Ended Three Months EndedSix Months Ended
February 28,February 28,February 28,
(in thousands)(in thousands)2022202120222021(in thousands)2023202220232022
AmericasAmericas$273,659 $247,991 $540,572 $492,327 Americas$331,121 $273,659 $654,488 $540,572 
EMEAEMEA114,591 105,493 229,594 211,270 EMEA132,508 114,591 263,246 229,594 
Asia PacificAsia Pacific42,869 38,304 85,678 76,396 Asia Pacific51,456 42,869 102,166 85,678 
Total RevenuesTotal Revenues$431,119 $391,788 $855,844 $779,993 Total Revenues$515,085 $431,119 $1,019,900 $855,844 
5.4. FAIR VALUE MEASURES
Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability (i.e., the "exit price") in an orderly transaction between market participants at the measurement date. In determining fair value, the use of various valuation methodologies, including market, income and cost approaches, is permissible. We consider the principal or most advantageous market in which we would transact and consider assumptions that market participants would use when pricing the asset or liability. 
Fair Value Hierarchy 
The accounting guidance for fair value measurements establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value based on the reliability of inputs. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect its placement within the fair value hierarchy levels. We have categorized our cash equivalents, investments and derivatives within the fair value hierarchy as follows: 
Level 1 – applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. These Level 1 assets and liabilities include our corporate money market funds that are classified as cash equivalents. 
Level 2 – applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which
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significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Our mutual funds and derivative instruments are classified as Level 2. 
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Level 3 – applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. We held no Level 3 assets or liabilities as of February 28, 2022 or August 31, 2021.
(a) Assets and Liabilities Measured at Fair Value on a Recurring Basis 
The following tables show, by level within the fair value hierarchy, our assets and liabilities that are measured at fair value on a recurring basis atas of February 28, 20222023 and August 31, 2021.2022. We did not have any transfers between levels of fair value measurements during the periods presented.presented below. We held no Level 3 assets or liabilities measured at fair value on a recurring basis as of February 28, 2023 and August 31, 2022.
Fair Value Measurements at February 28, 2022 Fair Value Measurements at February 28, 2023
(in thousands)(in thousands)Level 1Level 2Total(in thousands)Level 1Level 2Total
AssetsAssets   Assets 
Corporate money market funds (1)
$167,562 $— $167,562 
Mutual funds (2)
— 34,984 34,984 
Corporate money market funds(1)
Corporate money market funds(1)
$163,032 $— $163,032 
Mutual funds(2)
Mutual funds(2)
— 32,022 32,022 
Derivative instruments (3)
— 4,592 4,592 
Derivative instruments(3)
Derivative instruments(3)
— 11,583 11,583 
Total assets measured at fair valueTotal assets measured at fair value$167,562 $39,576 $207,138 Total assets measured at fair value$163,032 $43,605 $206,637 
LiabilitiesLiabilitiesLiabilities
Derivative instruments (3)
Derivative instruments (3)
$— $2,110 $2,110 
Derivative instruments(3)
$— $1,692 $1,692 
Total liabilities measured at fair valueTotal liabilities measured at fair value$— $2,110 $2,110 Total liabilities measured at fair value$— $1,692 $1,692 
Fair Value Measurements at August 31, 2021 Fair Value Measurements at August 31, 2022
(in thousands)(in thousands)Level 1Level 2Total(in thousands)Level 1Level 2Total
AssetsAssets   Assets 
Corporate money market funds (1)
Corporate money market funds (1)
$232,519 $— $232,519 
Corporate money market funds(1)
$179,330 $— $179,330 
Mutual funds (2)
Mutual funds (2)
— 35,984 35,984 
Mutual funds(2)
— 33,219 33,219 
Derivative instruments (3)
Derivative instruments (3)
— 1,384 1,384 
Derivative instruments(3)
— 12,412 12,412 
Total assets measured at fair valueTotal assets measured at fair value$232,519 $37,368 $269,887 Total assets measured at fair value$179,330 $45,631 $224,961 
LiabilitiesLiabilitiesLiabilities
Derivative instruments (3)
Derivative instruments (3)
$— $4,181 $4,181 
Derivative instruments(3)
$— $8,307 $8,307 
Total liabilities measured at fair valueTotal liabilities measured at fair value$— $4,181 $4,181 Total liabilities measured at fair value$— $8,307 $8,307 

1.(1) Our corporate money market funds are readily convertible into cash and the net asset value of each fund on the last day of the quarter is used to determine its fair value. Our corporate money market funds are classified as Level 1 assets and are included in Cash and cash equivalents within the Consolidated Balance Sheets.
2.(2) Our mutual funds have afunds' fair value is based on the fair value of the underlying investments held by the mutual funds, allocated to each share of the mutual fund using a net asset value approach. The fair value of the underlying investments is based on observable inputs. Our mutual funds are classified as Level 2 and are included in Investments (short-term) within the Consolidated Balance Sheets.
3.(3) Our derivative instruments include our foreign exchange forward contracts and interest rate swap agreements. We utilize the income approach to measure fair value for our foreign exchange forward contracts. The income approach uses pricing models that rely on market observable inputs such as spot, forward and interest rates, as well as credit default swap spreads, and are classified as Level 2 assets.spreads. To estimate fair value for theour interest rate swap agreement,agreements, we utilize a present value of future cash flows, leveraging a model-derived valuation that uses Level 2 observable inputs such as interest rate yield curves. Refer to Note 65, Derivative Instruments, for more information on our derivative instruments designed as cash flow hedges and their classification within the Consolidated Balance Sheets.
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(b) Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis
Assets and liabilities that are measured at fair value on a non-recurring basis relate primarily to our tangible fixed assets, lease right-of-use ("ROU")ROU assets, goodwill and intangible assets. The fair values of these non-financial assets and liabilities are determined based on valuation techniques using the best information available, and may include quoted market prices, market comparable information and discounted cash flow projections. These non-financial assets are required to be assessed for impairment whenever events or circumstances indicate that their carrying value may not be fully recoverable, and at least annually for goodwill.
During
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Asset impairments incurred during the three and six months ended February 28, 2022 we incurred anwere $10.3 million and $14.0 million, respectively, with no similar level of impairment charge ofrecorded during the three and six ended February 28, 2023. The asset impairments recognized during the three and six months ended February 28, 2022 included a respective $9.7 million and $13.4 million respectively,charge related to our lease ROU assets and Property,property, equipment and leasehold improvements associated with vacating certain leased office space. For those locations we anticipateanticipated subleasing, we estimated the fair value of the lease ROU assets as of the cease use date, using a market approach, based on expected future cash flows from sublease income. To complete this assessment we relied on certain assumptions, which included estimates of the rental rate, period of vacancy, incentives and annual rent increases. We fully impaired both the lease ROU assets for locations we will not sublease and substantially all the Property,property, equipment and leasehold improvements balances associated with the related vacated leased office space as there are no expected cash flows related to these items. As a result ofDue to the subjective nature of the unobservable inputs used, these assetsthe fair value measurement for the asset impairments are classified within Level 3 of the fair value hierarchy.
(c) Assets and Liabilities Measured at Fair Value for Disclosure Purposes Only 
AsWe elected not to carry our Long-term debt at fair value. The carrying value of February 28, 2022our Long-term debt is net of related unamortized discount and August 31, 2021, thedebt issuance costs.
The fair value of our 2019 Revolving Credit Facility (as defined below in Note 11, Debt), included in Long-term debt within the Consolidated Balance Sheets, was $575.0 million, which approximated its carrying amount given the application of a floating interest rate equal to LIBOR plus a spread using a debt leverage pricing grid. As the interest rateSenior Notes is a variable rate, adjustedestimated based on quoted prices in active markets as of the reporting date, given that the Senior Notes are publicly traded, which are considered Level 1 inputs. The fair value of our 2022 Credit Facilities is estimated based on quoted market conditions, it approximates the current market-rateprices for similar instruments, availableadjusted for unobservable inputs to companies with comparable credit qualityensure comparability to our investment rating, maturity terms and maturity, and therefore, the long-term debt is categorized asprincipal outstanding, which are considered Level 2 in the fair value hierarchy.
On March 1, 2022, we repaid in full and terminated the 2019 Credit Agreement and concurrently, FactSet Research Systems Inc. entered into the 2022 Credit Agreement.3 inputs. Refer to Note 17,11, Subsequent EventsDebt for definitiondefinitions of these terms and more information on the Senior Notes and 2022 Credit Agreement.Facilities.
The following table summarizes information on our outstanding debt as of February 28, 2023 and August 31, 2022:
6.
February 28, 2023August 31, 2022
(in thousands)Fair Value HierarchyPrincipal AmountEstimated Fair ValuePrincipal AmountEstimated Fair Value
2027 NotesLevel 1$500,000 $460,470 $500,000 $470,525 
2032 NotesLevel 1500,000 419,705 500,000 438,205 
2022 Term FacilityLevel 3500,000 503,125 750,000 750,975 
2022 Revolving FacilityLevel 3250,000 248,438 250,000 249,075 
Total principal amount$1,750,000 $1,631,738 $2,000,000 $1,908,780 
Total unamortized discounts and debt issuance costs(14,391)(17,576)
Total net carrying value of debt$1,735,609 $1,982,424 
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5. DERIVATIVE INSTRUMENTS
Cash Flow Hedges 
Foreign Currency Forward Contracts
We conduct business outsideIn designing our hedging approach, we consider several factors, including offsetting exposures, the U.S. in several currencies includingsignificance of exposures, the British Pound Sterling, Euro, Indian Rupee,forecasting of risk and Philippine Peso. As such, we are exposedthe potential effectiveness of the hedge to movements in foreign currency exchange rates. We utilize derivative instruments (foreign currency forward contracts) to manage the exposures related to the effects of foreign exchange rate fluctuations and reduce the volatility of our earnings and cash flows associated with changes in foreign currency.flows. Factors considered in the decision to hedge an underlying market exposure include the materiality of the risk, the volatility of the market, the duration of the hedge, the degree to which the underlying exposure is committed to, and the availability, effectiveness and cost of derivative instruments. Derivative instruments are only utilized for risk management purposes and are not used for speculative or trading purposes. We limit counterparties to credit-worthy financial institutions. Refer to Note 12,2, Commitments and Contingencies –Summary of Significant Accounting Policies - Concentrations of Credit RisRiskk,, for further discussion on counterparty credit risk. 
In designing a specific hedging approach,We leverage foreign currency forward contracts and interest rate swaps to mitigate certain operational exposures from the impact of changes in foreign currency exchange rates and to manage our interest rate exposure. We have designated and accounted for these derivatives as cash flow hedges with the unrealized gains or losses recorded in Accumulated Other Comprehensive Loss ("AOCL"), net of tax, in the Consolidated Balance Sheets. Realized gains or losses resulting from settlement of our forward contracts and swap agreements are subsequently reclassified into Selling, general and administrative ("SG&A") and Interest expense, net, respectively, in the Consolidated Statements of Income when the hedges are settled.
Foreign Currency Forward Contracts
As we consideredconduct business outside the U.S. in several factors, including offsetting exposures, the significance of exposures, the forecasting of risk and the potential effectiveness of the hedge.currencies, we are exposed to movements in foreign currency exchange rates. The gains and losses on foreign currency forward contracts offset the variability in operating expenses associated with currency movements. The changes in fair value for theseAs of February 28, 2023, we maintained a series of foreign currency forward contracts to hedge a portion of our exposures related to our primary currencies of the British Pound Sterling, Indian Rupee, Euro and Philippine Peso. We entered into these contracts to mitigate our currency exposure ranging from 25% to 75%, over their respective hedged periods, which are initially reportedset to mature at various points between the third quarter of fiscal 2023 through the second quarter of fiscal 2024.
The following table summarizes the gross notional value of foreign currency forward contracts to purchase British Pound Sterling, Euros, Indian Rupees and Philippine Pesos with U.S. dollars as of February 28, 2023 and August 31, 2022.
February 28, 2023August 31, 2022
(in thousands)Local CurrencyUSDLocal CurrencyUSD
British Pound Sterling£46,000 $55,491 £44,200 $55,567 
Euro37,500 39,877 37,500 40,679 
Indian RupeeRs2,987,143 36,200 Rs2,667,928 33,600 
Philippine Peso1,767,455 31,600 1,462,060 27,000 
Total$163,168 $156,846 
Refer to Foreign Currency Transaction Risk in Item 3. Quantitative and Qualitative Disclosures About Market Risk of this Quarterly Report on Form 10-Q for further discussion of our exposure to foreign exchange rate fluctuations.
Interest Rate Swap Agreements
2022 Swap Agreement
On March 1, 2022, we entered into an interest rate swap agreement ("2022 Swap Agreement") with a componentnotional amount of Accumulated$800.0 million to hedge a portion of our outstanding floating Secured Overnight Financing Rate ("SOFR") rate debt with a fixed interest rate of 1.162%. The notional amount of the 2022 Swap Agreement declines by $100.0 million on a quarterly basis as of May 31, 2022 and is maturing on February 28, 2024. Effective December 30, 2022, we partially novated our 2022 Swap Agreement to equally apportion the then outstanding notional amount of the interest rate swap between two counterparties. No other comprehensive lossterms of the 2022 Swap Agreement were amended, terminated, or otherwise modified. As of February 28, 2023, the notional amount of the 2022 Swap Agreement was $400.0 million.
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2020 Swap Agreement
On March 5, 2020, we entered into an interest rate swap agreement ("AOCL"2020 Swap Agreement") with a notional amount of $287.5 million. The 2020 Swap Agreement hedged a portion of our then outstanding floating LIBOR rate debt with a fixed interest rate of 0.7995% to mitigate our interest rate exposure. On March 1, 2022, we terminated the 2020 Swap Agreement, which resulted in a one-time benefit of $3.5 million recognized in Interest expense, net in the Consolidated Statements of Income during the third quarter of fiscal 2022, based on its fair market value.
Refer to Note 11, Debt, for further discussion of our outstanding floating SOFR rate debt. Refer to Interest Rate Risk in Part I, Item 3. Quantitative and Qualitative Disclosures About Market Risk of this Quarterly Report on Form 10-Q for further discussion of our exposure to interest rate risk on our long-term debt outstanding.
Gross Notional Value and Fair Value of Derivative Instrumentssubsequently
The following is a summary of the gross notional values of the derivative instruments:

(in thousands)
Gross Notional Value
February 28, 2023August 31, 2022
Foreign currency forward contracts$163,168 $156,846 
Interest rate swap agreement400,000 600,000 
Total cash flow hedges$563,168 $756,846 

The following is a summary of the fair values of our derivative instruments:
Fair Value of Derivative Instruments
(in thousands)Derivative AssetsDerivative Liabilities
Derivatives designated as hedging instrumentsBalance Sheet ClassificationFebruary 28, 2023August 31, 2022Balance Sheet ClassificationFebruary 28, 2023August 31, 2022
Foreign currency forward contractsPrepaid expenses and other current assets$1,738 $— Accounts payable and accrued expenses$1,692 $8,307 
Interest rate swap agreementPrepaid expenses and other current assets9,845 10,621 Accounts payable and accrued expenses— — 
Other assets— 1,791 Other liabilities— — 
Total cash flow hedges$11,583 $12,412 $1,692 $8,307 

All derivatives were designated as hedging instruments as of February 28, 2023 and August 31, 2022.
Derivative Recognition
The following table provides the pre-tax effect of derivative instruments in cash flow hedging relationships for the three months ended February 28, 2023 and February 28, 2022, respectively:
Gain (Loss) Recognized in AOCL on DerivativesLocation of Gain (Loss) Reclassified from AOCL into IncomeGain (Loss) Reclassified from AOCL into Income
(in thousands)February 28,February 28,
Derivatives in Cash Flow Hedging Relationships2023202220232022
Foreign currency forward contracts$(215)$(34)SG&A$(279)$(1,014)
Interest rate swap agreement848 3,795 Interest expense, net3,945 (498)
Total cash flow hedges$633 $3,761 $3,666 $(1,512)
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The following table provides the pre-tax effect of derivative instruments in cash flow hedging relationships for the six months ended February 28, 2023 and February 28, 2022, respectively:
Gain (Loss) Reclassified in AOCL on DerivativesLocation of Gain (Loss) Reclassified from AOCL into IncomeGain (Loss) Reclassified from AOCL into Income
(in thousands)February 28,February 28,
Derivatives in Cash Flow Hedging Relationships2023202220232022
Foreign currency forward contracts$3,108 $(3,576)SG&A$(5,244)$(1,463)
Interest rate swap agreement4,276 6,378 Interest expense, net6,842 (1,014)
Total cash flow hedges$7,384 $2,802 $1,598 $(2,477)

As of February 28, 2023, we estimate that net pre-tax derivative gains of $9.9 million included in AOCL will be reclassified into Operating expenses whenearnings within the next 12 months. As of February 28, 2023, our cash flow hedges were highly effective with no amount of ineffectiveness recorded in the Consolidated Statements of Income for these designated cash flow hedges and all components of each derivative’s gain or loss were included in the assessment of hedge is settled.effectiveness. There was no discontinuance of our cash flow hedges during the six months ended February 28, 20222023 or February 28, 2021,2022, and as such, no corresponding gains or losses related to changes in the value of our contracts were reclassified into earnings prior to settlement. 
As of February 28, 2022, we maintained foreign currency forward contracts to hedge a portion of our British Pound Sterling, Euro, Indian Rupee and Philippine Peso exposures. We entered into a series of forward contracts to mitigate our currency
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exposure ranging from 25% to 50% over their respective hedged periods. The current foreign currency forward contracts are set to mature at various points between the third quarter of fiscal 2022 through the first quarter of fiscal 2023.
As of February 28, 2022, the gross notional value of foreign currency forward contracts to purchase Philippine Pesos and Indian Rupees with U.S. dollars was ₱0.9 billion and Rs1.7 billion, respectively. The gross notional value of foreign currency forward contracts to purchase Euros and British Pound Sterling with U.S. dollars was €23.0 million and £24.3 million, respectively.
2020 Swap Agreement
On March 5, 2020, we entered into an interest rate swap agreement (the "2020 Swap Agreement") with a notional amount of $287.5 million to hedge the variable interest rate obligation on a portion of our outstanding debt under our 2019 Revolving Credit Facility (as defined below in Note 11, Debt). As of February 28, 2022, we have borrowed $575.0 million of the available $750.0 million under the 2019 Revolving Credit Facility, which bears interest on the outstanding principal amount at a rate equal to contractual one-month LIBOR plus a spread using a debt leverage pricing grid, which was 0.875% as of February 28, 2022. Refer to Note 11, Debt, for further discussion on the 2019 Revolving Credit Facility. Under the terms of the 2020 Swap Agreement, we will pay interest at a fixed rate of 0.7995% and receive variable interest payments based on the same one-month LIBOR utilized to calculate the interest expense from the 2019 Revolving Credit Facility. The 2020 Swap Agreement matures on March 29, 2024.
Refer to Interest Rate Risk in Part I, Item 3 of this Quarterly Report on Form 10-Q for further discussion on our exposure to interest rate risk on our long-term debt outstanding.
As the terms for the 2020 Swap Agreement align with the 2019 Revolving Credit Facility, we do not expect any hedge ineffectiveness. We have designated and accounted for this instrument as a cash flow hedge with the unrealized gains or losses on the interest rate swap agreement recorded in AOCL in the Consolidated Balance Sheets. Realized gains or losses are subsequently reclassified into Interest expense, net in the Consolidated Statement of Income when settled.
The following is a summary of the gross notional values of the derivative instruments:

(in thousands)
Gross Notional Value
February 28, 2022August 31, 2021
Foreign currency forward contracts$99,609 $154,728 
Interest rate swap agreement287,500 287,500 
Total cash flow hedges$387,109 $442,228 

Fair Value of Derivative Instruments
The following is a summary of the fair values of the derivative instruments:
Fair Value of Derivative Instruments
(in thousands)Derivative AssetsDerivative Liabilities
Derivatives designated as hedging instrumentsBalance Sheet ClassificationFebruary 28, 2022August 31, 2021Balance Sheet ClassificationFebruary 28, 2022August 31, 2021
Foreign currency forward contractsPrepaid expenses and other current assets$180 $1,384 Accounts payable and accrued expenses$2,110 $1,201 
Interest rate swap agreementPrepaid expenses and other current assets820 — Accounts payable and accrued expenses— 1,934 
Other assets3,592 — Other liabilities— 1,045 
Total cash flow hedges$4,592 $1,384 $2,110 $4,181 

All derivatives were designated as hedging instruments as of February 28, 2022 and August 31, 2021.
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Derivatives in Cash Flow Hedging Relationships
The following table provides the pre-tax effect of derivative instruments in cash flow hedging relationships for the three months ended February 28, 2022 and February 28, 2021, respectively:

Gain (Loss) Reclassified in AOCL on Derivatives Location of Gain (Loss) Reclassified from AOCL into IncomeGain (Loss) Reclassified from AOCL into Income
(in thousands)February 28,February 28,
Derivatives in Cash Flow Hedging Relationships2022202120222021
Foreign currency forward contracts$(34)$1,879 SG&A$(1,014)$2,069 
Interest rate swap agreement3,795 1,462 Interest expense, net(498)(472)
Total cash flow hedges$3,761 $3,341 $(1,512)$1,597 
The following table provides the pre-tax effect of derivative instruments in cash flow hedging relationships for the six months ended February 28, 2022 and February 28, 2021, respectively:
Gain (Loss) Recognized in AOCL on Derivatives Location of Gain (Loss) Reclassified from AOCL into IncomeGain (Loss) Reclassified from AOCL into Income
(in thousands)February 28,February 28,
Derivatives in Cash Flow Hedging Relationships2022202120222021
Foreign currency forward contracts$(3,576)$2,127 SG&A$(1,463)$2,886 
Interest rate swap agreement6,378 1,406 Interest expense, net(1,014)(942)
Total cash flow hedges$2,802 $3,533 $(2,477)$1,944 
As of February 28, 2022, our cash flow hedges were effective, with no amount of ineffectiveness recorded in the Consolidated Statements of Income for these designated cash flow hedges, and all components of each derivative���s gain or loss were included in the assessment of hedge effectiveness.

As of February 28, 2022, we estimate that net pre-tax derivative losses of $1.9 million related to the foreign currency forward contracts included in AOCL will be reclassified into earnings within the next 12 months. As of March 1, 2022, we terminated the 2020 Swap Agreement. Refer to Note 17, Subsequent Events for more information on the termination and the expected impact reclassified into earnings.
Offsetting of Derivative Instruments
We enter into master netting arrangements designed to permit net settlement of derivative transactions among the respective counterparties, settled on the same date and in the same currency. As of February 28, 20222023 and August 31, 2021,2022, there were no material amounts recorded net on the Consolidated Balance Sheets.
2022 Swap Agreement
As we desire to maintain a fixed to floating interest rate ratio of 80% on our outstanding debt portfolio, we entered into the 2022 Swap Agreement with a notional amount $800.0 million on March 1, 2022. The 2022 Swap Agreement will hedge our floating Term SOFR rate outstanding debt with a fixed rate of 1.162%. Refer to Note 17, Subsequent Events for the definition and more information on the 2022 Swap Agreement.
7.6. ACQUISITIONS
During fiscal 2022, and 2021, we completed acquisitions of several businesses, with the most significant cash flows related to the acquisitions ofCUSIP Global Services ("CGS") and Cobalt Software, Inc. ("Cobalt") and Truvalue Labs, Inc. ("TVL").
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CUSIP Global Services

On March 1, 2022, we completed the acquisition of CUSIP Global Services (“CGS"), previously operatedCGS for a cash purchase price of $1.932 billion, inclusive of working capital adjustments. CGS manages a database of 60 different data elements uniquely identifying more than 50 million global financial instruments. It is the foundation for security master files relied on by S&P Global Inc.,critical front, middle and back-office functions. CGS, operating on behalf of the American Bankers Association ("ABA"), is the provider of Committee on Uniform Security Identification Procedures ("CUSIP") and CUSIP International Number System ("CINS") identifiers globally and also acts as the official numbering agency for $1.925 billionInternational Securities Identification Number ("ISIN") identifiers in cash, subjectthe United States and as a substitute number agency for more than 35 other countries. We believe that the CGS acquisition will significantly expand our critical role in the global capital markets. The CGS purchase price was in excess of the fair value of net assets acquired, resulting in the recognition of goodwill. We finalized the purchase accounting for the CGS acquisition during the fourth quarter of fiscal 2022 and did not record any material changes to the preliminary purchase price allocation.
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The acquisition date fair values of major classes of assets acquired and liabilities assumed are as follows:
Acquisition Date Fair ValueAcquisition Date Useful LifeAmortization Method
(in thousands)(in years)
Current assets(1)
$29,728 
Amortizable intangible assets
ABA business process1,583,000 36 yearsStraight-line
Client relationships164,000 26 yearsStraight-line
Acquired databases46,000 15 yearsStraight-line
Goodwill214,970 
Current liabilities(2)
(104,691)
Deferred revenues, long-term(1,481)
Total purchase price$1,931,526 
(1) Includes an accounts receivable balance of $29.5 million.
(2) Includes a working capitaldeferred revenues balance of $99.4 million. The CGS acquisition was accounted for in accordance with our adoption of ASU No. 2021-08; as such, the deferred revenues did not include a fair value adjustment. Refer to Note 17, Subsequent Events2, Significant Accounting Policies in the Notes included in Item 8. of our Annual Report on Form 10-K for the fiscal year ended August 31, 2022 for more information on ASU No. 2021-08.
Goodwill totaling $215.0 million represents the excess of the CGS purchase price over the fair value of net assets acquired and considers future economic benefits that we expect to achieve as a result of the acquisition. The goodwill is included in the Americas segment and is deductible for income tax purposes. The majority of the net assets acquired relate to an ABA business process intangible which is a renewable license agreement with the ABA to manage the issuance, maintenance and access to the CUSIP numbering system and related database of CUSIP identifiers. This intangible asset's valuation and associated useful life considers the nature of the business relationship, multi-year term of the current agreement and the likelihood of long-term renewals. The useful life assigned to the Client relationships intangible asset considers the strong historical client retention and client renewals as a basis for expected future retention. The useful life assigned to Acquired databases considers the historical period of data collection and the limited changes to the data on an annual basis.
The results of CGS's operations have been included in our Consolidated Financial Statements, within the Americas, EMEA and Asia Pacific segments, beginning with the closing of the acquisition on March 1, 2022. CGS functions as part of CGS.CTS. Pro forma information has not been presented because the effect of the CGS acquisition was not material to our Consolidated Financial Statements.
Cobalt Software, Inc.
On October 12, 2021, we acquired all of the outstanding shares of Cobalt for a purchase price of $50.0 million, net of cash acquired.acquired, and inclusive of working capital adjustments. Cobalt is a leading portfolio monitoring solutions provider for the private capital industry. This acquisition advancesaligned with our strategy to scale our data and workflow solutions through targeted investments as part of our multi-year investment plan and expands our private markets offering. The Cobalt purchase price was in excess of the fair value of net assets acquired, resulting in the recognition of goodwill. We expect to finalize the allocation offinalized the purchase accounting for the Cobalt acquisition during the fourth quarter of fiscal 2022 and did not record any material changes to the preliminary purchase price for Cobalt as soon as possible, but in any event, no later than one year from the acquisition date.allocation.
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The acquisition date fair values of major classes of assets acquired and liabilities assumed are as follows:
Acquisition Date Fair ValueAcquisition Date Useful LifeAmortization Method
(in thousands)(in years)
Current assets$540 
Amortizable intangible assets
Software technology7,750 5 yearsStraight-line
Client relationships4,800 11 yearsStraight-line
Goodwill43,55441,338 
Other assets34 
Current liabilities(6,653)(4,437)
Other liabilities(7)
Total purchase price$50,018 
Goodwill totaling $43.6$41.3 million represents the excess of the Cobalt purchase price over the fair value of net assets acquired and is included in the Americas and EMEA segments. Goodwill generated from the Cobalt acquisition is not deductible for income tax purposes. The useful life assigned to the Client relationships intangible asset considers the historical client retention as a basis for expected future retention. The useful life assigned to Software technology considers our historical experience and anticipated technological changes.
The results of Cobalt's operations have been included in our Consolidated Financial Statements, within the Americas and EMEA segments, beginning with its acquisition on October 12, 2021. Pro forma information has not been presented because the effect of the Cobalt acquisition is not material to our Consolidated Financial Statements.
Truvalue Labs, Inc.
On November 2, 2020, we acquired all of the outstanding shares of TVL for a purchase price of $41.9 million, net of cash acquired. TVL is a leading provider of environmental, social, and governance ("ESG") information. TVL applies artificial intelligence driven technology to over 100,000 unstructured text sources in multiple languages, including news, trade journals, and non-governmental organizations and industry reports, to provide daily signals that identify positive and negative ESG behavior. The acquisition of TVL further enhances our commitment to providing industry leading access to ESG data across our platforms. The TVL purchase price was in excess of the fair value of net assets acquired, resulting in the recognition of goodwill. We finalized the purchase accounting for the TVL acquisition during the third quarter of fiscal 2021.

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The acquisition date fair values of major classes of assets acquired and liabilities assumed are as follows:
Acquisition Date Fair ValueAcquisition Date Useful LifeAmortization Method
(in thousands)(in years)
Current assets$812 
Amortizable intangible assets
Software technology8,100 7 yearsStraight-line
Client relationships900 12 yearsStraight-line
Trade names2,800 15 yearsStraight-line
Goodwill30,058 
Other assets5,299 
Current liabilities(3,069)
Other liabilities(2,984)
Total purchase price$41,916 
Goodwill totaling $30.1 million represents the excess of the TVL purchase price over the fair value of net assets acquired and is included in the Americas segment. Goodwill generated from the TVL acquisition is not deductible for income tax purposes. The results of TVL's operations have been included in our Consolidated Financial Statements, within the Americas segment, beginning with its acquisition on November 2, 2020. Pro forma information has not been presented because the effect of the TVL acquisition is not material to our Consolidated Financial Statements.
8.7. GOODWILL
Changes in the carrying amount of goodwill by segment for the six months ended February 28, 20222023 are as follows:
(in thousands)
AmericasEMEAAsia PacificTotal
Balance at August 31, 2021$430,088 $321,150 $2,967 $754,205 
Acquisitions43,769 428 — 44,197 
Foreign currency translations— (12,101)(129)(12,230)
Balance at February 28, 2022$473,857 $309,477 $2,838 $786,172 
(in thousands)
AmericasEMEAAsia PacificTotal
Balance at August 31, 2022$686,412 $277,087 $2,349 $965,848 
Foreign currency translations— 11,463 48 11,511 
Balance at February 28, 2023$686,412 $288,550 $2,397 $977,359 

Goodwill is not amortized as it is estimated to have an indefinite life. At least annually, we are required to test goodwill at the reporting unit level, which is consistent with our segments, for potential impairment, and, if impaired, we write down our goodwill to fair value based on the present value of discounted cash flows. We performed our annual goodwill impairment test during the fourth quarter of fiscal 20212022 utilizing a qualitative analysis, consistent with the timing and methodology of previous years. We concluded it was more likely than not that the fair value of each of our segments was greaternot less than its respective carrying value and no impairment charge was required.
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8. INTANGIBLE ASSETS
We amortize intangible assets on a straight line basis over their estimated useful lives. The estimated useful life, gross carrying amounts and accumulated amortization totals related to our identifiable intangible assets are as follows:

February 28, 2023August 31, 2022
(in thousands, except useful lives)Estimated Useful Life (years)Gross Carrying AmountAccumulated AmortizationNet Carrying AmountGross Carrying AmountAccumulated AmortizationNet Carrying Amount
ABA business process36$1,583,000 $43,972 $1,539,028 $1,583,000 $21,986 $1,561,014 
Client relationships11 to 26263,825 62,102 201,723 263,163 55,405 207,758 
Software technology2 to 9123,463 101,985 21,478 122,363 96,567 25,796 
Developed technology3 to 596,981 41,654 55,327 80,956 33,676 47,280 
Acquired databases1546,000 3,067 42,933 46,000 1,533 44,467 
Data content7 to 2033,625 26,704 6,921 32,305 24,973 7,332 
Trade names156,759 4,395 2,364 6,693 4,431 2,262 
Total$2,153,653 $283,879 $1,869,774 $2,134,480 $238,571 $1,895,909 
The weighted average useful life of our intangible assets at February 28, 2023 was 32.8 years. As described in Note 6, Acquisitions, we acquired several intangible assets as part of the CGS acquisition. The weighted average useful life of our intangible assets at February 28, 2023, excluding those acquired from CGS, was 9.3 years. We assess intangible assets for indicators of impairment on a quarterly basis, including an evaluation of our useful lives to determine if events and circumstances warrant a revision to the remaining period of amortization. If indicators of impairment are present, amortizable intangible assets are tested for impairment by comparing the carrying value to undiscounted cash flows and, if impaired, written down to fair value based on discounted cash flows. We have not identified a material impairment nor a material change to the estimated remaining useful lives of our intangible assets for the six months ended February 28, 2023 and February 28, 2022. The intangible assets have no assigned residual values.
Amortization expense recorded for intangible assets for the three months ended February 28, 2023 and February 28, 2022 was $21.7 million and $9.1 million, respectively. Amortization expense for intangible assets for the six months ended February 28, 2023 and February 28, 2022 was $43.4 million and $19.2 million, respectively.
As of February 28, 2023, estimated intangible asset amortization expense for each of the next five years and thereafter are as follows:
(in thousands)
Estimated Amortization Expense
Fiscal Years Ended August 31,
2023 (remaining six months)$46,853 
202485,169 
202578,644 
202670,020 
202763,279 
Thereafter1,525,809 
Total$1,869,774 
9. INCOME TAXES
Income tax expense is based on taxable income determined in accordance with current enacted laws and tax rates. Deferred income taxes are recorded for the temporary differences between the financial statement and the tax bases of assets and liabilities using currently enacted tax rates.
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Income Tax Provision for Income Taxesand Effective Tax Rate
The provision for income taxes is as follows:
Three Months EndedSix Months Ended
February 28,February 28,
(in thousands)2022202120222021
Income before income taxes$121,956 $114,666 $241,886 $234,898 
Provision for income taxes$12,018 $18,023 $24,301 $37,049 
Effective tax rate9.9 %15.7 %10.0 %15.8 %
Ourand effective tax rate are as follows:
Three Months EndedSix Months Ended
February 28,February 28,
(in thousands)2023202220232022
Income before income taxes$156,762 $121,956 $314,647 $241,886 
Provision for income taxes$25,169 $12,018 $46,256 $24,301 
Effective tax rate16.1 %9.9 %14.7 %10.0 %
We are subject to taxation in the United States and various foreign jurisdictions in which we conduct our business. Our provision for income taxes for interim periods is based on recurring factors and non-recurring events, including the taxationcalculated by applying an estimate of foreign income. Ourour annual effective tax rate will vary based on, among other things, changesto our quarter and year-to-date results, adjusted for discrete items recorded in levelsthe period. The computation of foreign income, as well as discrete and other non-recurring events that may not be predictable. Ourthe annual estimated effective tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected pretax income (or loss) for the year, projections of the proportion of income (or loss) earned and taxed in foreign jurisdictions, permanent and temporary differences and the likelihood of recovering deferred tax assets, then adjusted for any discrete items. On a quarterly basis, we update the estimate of our annual effective tax rate as new events occur, assumptions change, or additional information is obtained.
For the three months ended February 28, 2023, the effective tax rate was 16.1% compared to 9.9% for the same period a year ago. For the six months ended February 28, 2023, the effective tax rate was 14.7% compared to 10.0% for the same period a year ago. For all periods presented, our effective tax rate was lower than the applicable U.S. corporate income tax rate, formainly due to research and development ("R&D") tax credits, a foreign derived intangible income ("FDII") deduction, and a tax benefit from the exercise of stock options.
Our effective tax rate during the three and six months ended February 28, 2022, driven2023 was higher than the rate during the respective prior year periods, due mainly by research and development ("R&D")to a decrease in the impact of tax credits and a foreign derived intangible income ("FDII") deduction. Theattributes on the effective tax rate foras a result of an increase in income, a lower tax benefit from the three and six months ended February 28, 2022 is further reduced by windfall tax benefits associated with the employee exercise of stock options.options and an increase in the U.K.'s enacted tax rates.
For the three months ended February 28,Inflation Reduction Act of 2022
On August 16, 2022, the provision for income taxesInflation Reduction Act ("IRA") was $12.0 million, compared with $18.0 million for the same period a year ago.signed into law. The provision decreased mainly due to lower projected levels of income before income taxes, a lower effective tax rate comparedIRA contains several revisions to the prior year period andInternal Revenue Code effective for taxable years beginning after December 31, 2022, including a $4.2 million reduction from higher windfall15% minimum income tax benefits, partially offseton certain large corporations. The IRA also includes a 1% excise tax on corporate stock repurchases made by higher income before income taxes duringpublicly traded U.S. corporations after December 31, 2022. We do not expect the three months ended February 28, 2022, compared with the prior year period.
For the six months ended February 28, 2022, the provision for income taxes was $24.3 million, compared with $37.0 million for the same periodIRA to have a year ago. The provision decreased mainly due to lower projected levels of income before income taxes, a lower effective tax rate compared to the prior year period and a $11.2 million in higher windfall tax benefits, partially offset by higher income before income taxes during the six months ended February 28, 2022, compared with the prior year period.material impact on our Consolidated Financial Statements.
10. LEASES
On September 1, 2019, we adopted ASC 842,Our lease portfolio is primarily related to our office space, Leases ("ASC 842"). As part of this adoption, we elected not to recordunder various operating lease ROU assets or operating lease liabilities for leases with an initial term of 12 months or less. We elected the practical expedient not to separate lease components from non-lease components but, rather, to combine them into one single lease component, which we recognize over the expected term on a straight-line expense basis in occupancy costs (a component of SG&A expense).agreements. We review new arrangements at inception to evaluate whether we obtain substantially all the economic benefits of and have the right to control the use of an asset.
Our lease portfolio is primarily related to our office space, under various operating lease agreements. Our lease ROU assets and lease liabilitiesare recognized based on the present value of future minimum lease payments at lease commencement (which includes fixed lease payments and certain qualifying index-based variable payments) over the reasonably certain lease term, leveraging an estimated incremental borrowing rate ("IBR").IBR. Certain adjustments to calculate our lease ROU assets may be required for items such as the payment ofdue to prepayments, lease incentives received and initial direct costs or incentives received.incurred. We account for the lease and non-lease components as a single lease component, which we recognize over the expected term on a straight-line expense basis in occupancy costs (a component of SG&A expense) in our Consolidated Statements of Income.
As of February 28, 2022,2023, we recognized $206.2$150.2 million of Lease right-of-use assets, net and $264.3$225.2 million of combined Current lease liabilities and Long-term lease liabilities in the Consolidated Balance Sheets. Such leases have a remaining lease term ranging from less than one year to just under 1413 years and did not include any renewal or termination options that were not yet reasonably certain to be exercised.
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The following table reconciles our future undiscounted cash flows related to our operating leases and the reconciliation to the combined Current lease liabilities and Long-term lease liabilities in the Consolidated Balance Sheets as of February 28, 20222023:
(in thousands)
(in thousands)
Minimum Lease
Payments
(in thousands)
Minimum Lease
Payments
Fiscal Years Ended August 31,Fiscal Years Ended August 31,Fiscal Years Ended August 31,
2022 (remaining six months)$21,408 
202339,965 
2023 (remaining six months)2023 (remaining six months)$19,171 
2024202437,412 202435,952 
2025202535,671 202533,864 
2026202634,075 202633,043 
2027202731,777 
ThereafterThereafter150,583 Thereafter114,427 
TotalTotal$319,114 Total$268,234 
Less: Imputed interestLess: Imputed interest54,829 Less: Imputed interest42,992 
Present valuePresent value$264,285 Present value$225,242 
The following table includes the components of lease cost related to our operating leases were as follows:occupancy costs in our Consolidated Statements of Income:
Three Months EndedSix Months Ended
February 28,February 28,
(in millions)
2022202120222021
Operating lease cost1
$10.2 $10.8 $20.7 $21.5 
Variable lease cost2
$2.9 $4.3 $5.8 $7.7 
Three Months EndedSix Months Ended
February 28,February 28,
(in thousands)
2023202220232022
Operating lease cost(1)
$8,156 $10,221 $16,233 $20,699 
Variable lease cost(2)
$3,834 $2,858 $8,054 $5,748 
1.(1)    Operating lease costs include costs associated with fixed lease payments and index-based variable payments that qualified for lease accounting under ASC 842, Leases and complied with the practical expedients and exceptions elected by us.
2.(2)    Variable lease costs were not included in the measurement of lease liabilities. These costs primarily include variable non-lease costs and leases that qualified for the short-term lease exception. Our variable non-lease costs include costs that were not fixed at the lease commencement date and are not dependent on an index or rate. These costs relate towere not included in the measurement of lease liabilities and primarily include variable non-lease costs, such as utilities, real estate taxes, insurance and maintenance.maintenance, as well as lease costs for those leases that qualified for the short-term lease exception.
The following table summarizes our lease term and discount rate assumptions related to the operating leases recorded on the Consolidated Balance Sheets:
February 28, 2022August 31, 2021As of February 28, 2023As of August 31, 2022
Weighted average remaining lease term (in years)
Weighted average remaining lease term (in years)
8.99.4
Weighted average remaining lease term (in years)
8.28.6
Weighted average discount rate (IBR)
Weighted average discount rate (IBR)
4.3 %4.3 %
Weighted average discount rate (IBR)
4.4 %4.4 %

The following table summarizes supplemental cash flow information related to our operating leases:
Six Months EndedSix Months Ended
February 28,February 28,
(in millions)
20222021
(in thousands)
(in thousands)
20232022
Cash paid for amounts included in the measurement of lease liabilitiesCash paid for amounts included in the measurement of lease liabilities$22.2 $20.0 Cash paid for amounts included in the measurement of lease liabilities$19,596 $22,172 
Lease ROU assets obtained in exchange for lease liabilities(1)Lease ROU assets obtained in exchange for lease liabilities(1)$2.7 $5.8 Lease ROU assets obtained in exchange for lease liabilities(1)$1,379 $2,680 
Reductions to ROU assets resulting from reductions to lease liabilities1
$(8.9)$— 
Reductions to ROU assets resulting from reductions to lease liabilities(2)
Reductions to ROU assets resulting from reductions to lease liabilities(2)
$— $(8,893)
1.(1)Primarily relatedincludes new lease arrangements entered into during the period and contract modifications that extend our lease terms and/or provide additional rights.
(2)Primarily relates to lease term reassessments based on contractual options to early terminate, resulting in a reduction to the lease liability and the corresponding Leaselease ROU asset.
During the three and six months ended February 28, 2022, we incurred an impairment charge of $5.8 million and $7.2 million, respectively, related to our lease ROU assets associated with vacating certain leased office space. Refer to toNote 5, 4, Fair Value Measuresfor more information on the lease ROU assets impairment methodology.
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11.DEBT
Our debt obligations at February 28, 2022 and August 31, 2021 consisted of the following:
(in thousands)February 28, 2022August 31, 2021
2019 Revolving Credit Facility$575,000 $575,000 
2019 Revolving Credit Facility debt issuance costs(375)(465)
Long-term debt$574,625 $574,535 
2019 Credit Agreement
On March 29, 2019, we entered into a credit agreement, as the borrower, with PNC Bank, National Association ("PNC"), as the administrative agent and lender (the "2019 Credit Agreement"), which provides for a $750.0 million revolving credit facility (the "2019 Revolving Credit Facility"). The 2019 Revolving Credit Facility allows for borrowings until its maturity date of March 29, 2024. The 2019 Credit Agreement also allows for, subject to certain requirements, additional borrowings with PNC for an aggregate amount up to $500.0 million, provided that any such request for additional borrowings must be in a minimum amount of $25.0 million.
As of February 28, 2022, we have borrowed $575.0 million of the available $750.0 million provided by the 2019 Revolving Credit Facility, resulting in $175.0 million available to be withdrawn. We are required to pay a commitment fee using a pricing grid currently at 0.10% based on the daily amount by which the available balance in the 2019 Revolving Credit Facility exceeds the borrowed amount. All outstanding loan amounts are reported as Long-term debt within the Consolidated Balance Sheets at February 28, 2022. The principal balance is payable in full on the maturity date.
Borrowings under the 2019 Revolving Credit Facility bear interest on the outstanding principal amount at a rate equal to the daily LIBOR plus a spread using a debt leverage pricing grid, currently at 0.875%. For the three months ended February 28, 2022 and February 28, 2021, we recorded interest expense on our outstanding debt, including the amortization of debt issuance costs, net of the effects of the interest rate swap agreement, of $1.9 million in each respective period. For the six months ended February 28, 2022 and February 28, 2021, we recorded interest expense on our outstanding debt, including the amortization of debt issuance costs, net of the effects of the interest rate swap agreement, of $3.8 million and $4.0 million, respectively.
Including the effects of the interest rate swap agreement, the year-to-date weighted average interest rate on amounts outstanding under our 2019 Revolving Credit Facility was 1.36% and 1.38% as of February 28, 2022 and August 31, 2021, respectively. Refer to Note 6, Derivative Instruments for further discussion on the interest rate swap agreement. Interest on the loan outstanding under the 2019 Revolving Credit Facility is payable quarterly, in arrears, and on the maturity date.
During fiscal 2019, we incurred approximately $0.9 million in debt issuance costs related to the 2019 Credit Agreement. These costs were capitalized as debt issuance costs and are amortized into interest expense ratably over the term of the 2019 Credit Agreement.
The 2019 Credit Agreement contains covenants and requirements restricting certain of our activities, which are usual and customary for this type of loan. In addition, the 2019 Credit Agreement requires that we maintain a consolidated net leverage ratio, as measured by total net funded debt/EBITDA (as defined in the 2019 Credit Agreement) below a specified level as of the end of each fiscal quarter. We were in compliance with all covenants and requirements within the 2019 Credit Agreement as of February 28, 2022.
As of March 1, 2022, we repaid in full and terminated our 2019 Credit Agreement. Refer to Note 17, Subsequent Events for more information on the termination.
2022 Credit Agreement
On March 1, 2022, FactSet Research Systems Inc. entered into the 2022 Credit Agreement and concurrently repaid in full and terminated the 2019 Credit Agreement. On March 1, 2022, per the 2022 Credit Agreement, we borrowed $1.0 billion under the 2022 Term Facility and $250.0 million under the 2022 Revolving Facility. Refer to Note 17, Subsequent Events for definition of these terms and more information on the 2022 Credit Agreement.
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Senior Notes
On March 1, 2022, FactSet Research Systems Inc. completed a public offering of $500.0 million aggregate principal amount of 2.900% Senior Notes due 2027 and $500.0 million aggregate principal amount of 3.450% Senior Notes due 2032. Refer to Note 17, Subsequent Events for more information on these senior notes.
12. COMMITMENTS AND CONTINGENCIES
Commitments represent obligations, such as those for future purchases of goods or services, that are not yet recorded on the balance sheet as liabilities. We record liabilities for commitments when incurred (i.e., when the goods or services are received).
Purchase Commitments with Suppliers and Vendors
Purchase obligations represent payments due in future periods in respect of commitments to our various data vendors as well as commitments to purchase goods and services. These purchase commitments are agreements that are enforceable and legally binding on us, and they specify all significant terms, including: fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and the approximate timing of the transaction. As of August 31, 2021, we had total purchase commitments with suppliers of $191.9 million. During the second quarter of fiscal 2022, we entered into a software subscription agreement with total purchase commitments of approximately $10 million with a contract term of three years.

We also have contractual obligations related to our lease liabilities and outstanding debt. Refer to Note 10, Leases, Note 11, Debt andNote 17, Subsequent Events for information regarding lease commitments; outstanding debt obligations; and newly issued senior notes and debt obligations, respectively.
Letters of Credit
From time to time, we are required to obtain letters of credit in the ordinary course of business. As of February 28, 2022, we had approximately $0.6 million of standby letters of credit outstanding. These standby letters of credit utilize the same covenants included in the 2019 Credit Agreement. Refer to Note 11, Debt for more information on these covenants.
Contingencies
Income Taxes
Uncertain income tax positions are accounted for in accordance with applicable accounting guidance, refer to Note 9, Income Taxes, for further details. We are currently under audit by tax authorities and have reserved for potential adjustments to our provision for income taxes that may result from examinations by, or any negotiated settlements with, these tax authorities. We believe that the final outcome of these examinations or settlements will not have a material effect on our results of operations or our cash flows. If events occur which indicate payment of these amounts is unnecessary, the reversal of the liabilities would result in the recognition of tax benefits in the period we determine the liabilities are no longer necessary. If our estimates of the federal, state and foreign income tax liabilities are less than the ultimate assessment, additional expense would result.
Legal Matters
We accrue non-income tax liabilities for contingencies when management believes that a loss is probable, and the amounts can be reasonably estimated. Contingent gains are recognized only when realized. We are engaged in various legal proceedings, claims and litigation that have arisen in the ordinary course of business, including employment matters, commercial and intellectual property litigation. The outcome of all the matters against us are subject to future resolution, including the uncertainties of litigation. Based on information available as of February 28, 2022, our management believes that the ultimate outcome of these unresolved matters against us, individually or in the aggregate, will not have a material adverse effect on our consolidated financial position, our results of operations or our cash flows.
Sales Tax Matters
On August 8, 2019, we received a Notice of Intent to Assess (the "First Notice") additional sales taxes, interest and underpayment penalties from the Commonwealth of Massachusetts Department of Revenue (the "Commonwealth") relating to the tax periods from January 1, 2006 through December 31, 2013. On July 20, 2021, we received a Notice of Intent to Assess (the "Second Notice", cumulatively with the First Notice, the "Notices") additional sales taxes, interest and underpayment penalties from the Commonwealth relating to the tax periods from January 1, 2014 through December 31, 2018. Based upon the Notices, it is the Commonwealth's intention to assess sales tax, interest and underpayment penalties on previously recorded sales transactions. We have filed an appeal to the Notices and intend to contest any such assessment, if assessed. We continue to cooperate with the Commonwealth's inquiry with respect to the Notices.
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On August 10, 2021, we received a letter (the "Letter") from the Commonwealth relating to the tax periods from January 1, 2019 through June 30, 2021, requesting additional sales information to determine if a notice of intent to assess should be issued to FactSet with respect to these tax periods. Based upon a preliminary review of the Letter, we believe the Commonwealth might seek to assess sales tax, interest and underpayment penalties on previously recorded sales transactions. We are cooperating with the Commonwealth's inquiry with respect to the Letter.
Due to the uncertainty surrounding the assessment process for both the Notices and Letter, we are unable to reasonably estimate the ultimate outcome of these matters and, as such, have not recorded a liability for any of these matters as of February 28, 2022. We believe that we will ultimately prevail if we are presented with a formal assessment for any of these matters; however, if we do not prevail, the amount of any assessment could have a material impact on our consolidated financial position, results of operations and cash flows.
Indemnifications
As permitted or required under Delaware law and to the maximum extent allowable under that law, we have certain obligations to indemnify our current and former officers and directors for certain events or occurrences while the officer or director is, or was, serving at our request in such capacity. These indemnification obligations are valid as long as the director or officer acted in good faith and in a manner the person reasonably believed to be in, or not opposed to, the best interests of FactSet, and with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. The maximum potential amount of future payments we could be required to make under these indemnification obligations is unlimited; however, we have a director and officer insurance policy that we believe mitigates our exposure and may enable us to recover a portion of any future amounts paid. We believe the estimated fair value of these indemnification obligations is immaterial.

Concentrations of Credit Risk
Cash equivalents
Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents. We are exposed to credit risk for cash and cash equivalents held in financial institutions in the event of a default, to the extent that such amounts are in excess of applicable insurance limits. We have not experienced any losses from maintaining cash accounts in excess of such limits. We do not believe our concentration of cash and cash equivalents present a significant credit risk as the counterparties to the instruments consist of multiple high-quality, credit-worthy financial institutions.
Accounts Receivable
Our accounts receivable are subject to collection risk as they are unsecured and derived from revenues earned from clients located around the globe. We do not require collateral from our clients. We maintain reserves for potential write-offs and evaluate the adequacy of the reserves on a quarterly basis. These losses have historically been within expectations. No single client represented more than 3% of our total revenues in any period presented. As of February 28, 2022, the receivable reserve was $4.3 million compared with $6.4 million as of August 31, 2021.
Derivative Instruments
Our use of derivative instruments exposes us to credit risk to the extent counterparties may be unable to meet the terms of their agreements. To mitigate credit risk, we limit counterparties to credit-worthy financial institutions and distribute contracts among these institutions to reduce the concentration of credit risk. We do not expect any losses as a result of default by our counterparties.
Concentrations ofOtherRisk
Data Content Providers
We integrate data from various third-party sources into our hosted propriety data and analytics platform, which our clients access to perform their analyses. As certain data sources have a limited number of suppliers, we make every effort to assure that, where reasonable, alternative sources are available. We are not dependent on any individual third-party data supplier in order to meet the needs of our clients, with only two data suppliers each representing more than 10% of our total data costs for the six months ended February 28, 2022.
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13.STOCKHOLDERS’ EQUITY
Shares of common stock outstanding were as follows:
Six Months Ended
February 28,
(in thousands)20222021
Balance, beginning of period37,615 38,030 
Common stock issued for employee stock plans322 176 
Repurchase of common stock from employees(1)
(7)(7)
Repurchase of common stock under the share repurchase program(2)
(46)(354)
Balance, end of period37,884 37,845 
(1)For the six months ended February 28, 2022 and February 28, 2021, we repurchased 7,422 and 7,447 shares from employees, or $3.3 million and $2.4 million of common stock, respectively, primarily to satisfy withholding tax obligations due upon the vesting of stock-based awards.
(2)Refer to Share Repurchase Program below for more information on the year over year change.
Share Repurchase Program
Under our share repurchase program, we may repurchase shares of our common stock from time to time in the open market and privately negotiated transactions, subject to market conditions.
Beginning in the second quarter of fiscal 2022, we suspended our share repurchase program through at least the second half of fiscal 2023, with the exception of potential minor repurchases to offset dilution from grants of equity awards or repurchases to satisfy withholding tax obligations due upon the vesting of stock-based awards. The suspension of our share repurchase program allows us to prioritize the repayment of debt under the 2022 Credit Agreement. Refer to Note 17, Subsequent Events for the definition of and more information on the 2022 Credit Agreement.
As such, for the three months ended February 28, 2022, we did not make any repurchases under our existing share repurchase program, compared to 221,959 shares repurchased for $71.5 million for the three months ended February 28, 2021. During the six months ended February 28, 2022, we repurchased 46,200 shares for $18.6 million under our existing share repurchase program compared with 353,759 shares for $114.6 million in the same period a year ago.
As of February 28, 2022, a total of $181.3 million remained authorized for future share repurchases under this program. There is no defined number of shares to be repurchased over a specified timeframe through the life of the share repurchase program.
Restricted Stock
Restricted stock awards entitle the holders to receive shares of common stock as the awards vest over time. For the six months ended February 28, 2022, 18,360 shares of previously granted restricted stock vested and were included in common stock outstanding as of February 28, 2022 (recorded net of 7,162 shares repurchased from employees at a cost of $3.1 million to cover their cost of taxes upon vesting of the restricted stock). During the six months ended February 28, 2021, 18,943 shares of previously granted restricted stock vested and were included in common stock outstanding as of February 28, 2021 (recorded net of 7,129 shares repurchased from employees at a cost of $2.3 million to cover their cost of taxes upon vesting of the restricted stock).

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Dividends
Our Board of Directors declared dividends in the six months ended February 28, 2022 and February 28, 2021 as follows:
Year EndedDividends per
Share of
Common Stock
Record DateTotal $ Amount
(in thousands)
Payment Date
Fiscal 2022
First Quarter$0.82 November 30, 2021$30,973 December 16, 2021
Second Quarter$0.82 February 28, 2022$31,065 March 17, 2022
Fiscal 2021
First Quarter$0.77 November 30, 2020$29,266 December 17, 2020
Second Quarter$0.77 February 26, 2021$29,141 March 18, 2021
Future cash dividend payments will depend on our earnings, capital requirements, financial condition and other factors considered relevant by us and are subject to final determination by our Board of Directors.
Accumulated Other Comprehensive Loss
The components of AOCL are as follows:
(in thousands)February 28, 2022August 31, 2021
Accumulated unrealized gains (losses) on cash flow hedges$2,715 $(2,095)
Accumulated foreign currency translation adjustment losses(58,563)(36,867)
Total AOCL$(55,848)$(38,962)
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14.EARNINGS PER SHARE
A reconciliation of the weighted average shares outstanding used in the basic and diluted earnings per share ("EPS") computations is as follows:
Three Months EndedSix Months Ended
February 28,February 28,
(in thousands, except per share data)2022202120222021
Numerator
Net income used for calculating basic and diluted income per share$109,938 $96,643 $217,585 $197,849 
Denominator
Weighted average common shares used in the calculation of basic income per share37,837 37,916 37,685 37,961 
Common stock equivalents associated with stock-based compensation plan924 704 943 697 
Shares used in the calculation of diluted income per share38,761 38,620 38,628 38,658 
Basic income per share$2.91 $2.55 $5.77 $5.21 
Diluted income per share$2.84 $2.50 $5.63 $5.12 
Dilutive potential common shares consist of stock options and unvested performance-based awards. There were no stock options excluded from the calculation of diluted EPS forsimilar lease ROU asset impairments recorded during the three and six months ended February 28, 2022. For each2023.
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11.DEBT
We elected not to carry our Long-term debt at fair value. The carrying value of our debt is net of related unamortized discount and debt issuance costs. Our total debt obligations as of February 28, 2023 and August 31, 2022 consisted of the three and six months ended February 28, 2021, the number of stock options excluded from the calculation of diluted EPS was 1,750.following:
Performance-based awards are omitted from the calculation of diluted EPS until it is determined that the performance criteria has been met at the end of the reporting period. For the three and six months ended February 28, 2022, there were 95,865 performance-based awards excluded from the calculation of diluted EPS. For each of the three and six months ended February 28, 2021, there were 71,275 performance-based awards excluded from the calculation of diluted EPS.
(in thousands)Issuance DateContractual
Maturity Date
February 28, 2023August 31, 2022
2022 Credit Agreement
2022 Term Facility3/1/20223/1/2025500,000 750,000 
2022 Revolving Facility3/1/20223/1/2027250,000 250,000 
Senior Notes
2027 Notes3/1/20223/1/2027500,000 500,000 
2032 Notes3/1/20223/1/2032500,000 500,000 
Total unamortized discounts and debt issuance costs(14,391)(17,576)
Total Long-term debt$1,735,609 $1,982,424 
15. STOCK-BASED COMPENSATION
We recognized total stock-based compensation expense of $15.5 million and $11.0 million during the three months ended February 28, 2022 and February 28, 2021, respectively. During the six months ended February 28, 2022 and February 28, 2021, we recognized total stock-based compensation expense of $25.9 million and $22.3 million, respectively. As of February 28, 2022, $129.3 million of2023, annual maturities on our total unrecognized compensation expense related to non-vested awards is expected to be recognized over a weighted average period of 3.2 years. There was no stock-based compensation capitalized as of February 28, 2022 and February 28, 2021.
Employee Stock Option Awards
During the six months ended February 28, 2022, we granted 302,493 stock options under the FactSet Research Systems Inc. Stock Option and Award Plan, as Amended and Restated (the "LTIP") with a weighted average exercise price of $434.70 to existing employees of FactSet, using the lattice-binomial option-pricing model. The majority of the stock options granted during the six months ended February 28, 2022 are related to the annual employee grant on November 1, 2021 under the LTIP. The stock option awards granted on November 1, 2021 vest 20% annually on the anniversary date of the grant and are fully vested after five years, expiring ten years from the date of grant. As of February 28, 2022, we had 4.7 million share-based awards available for grant under the LTIP.

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Employee Stock Option Fair Value Determinations
We utilize the lattice-binomial option-pricing model ("binomial model") to estimate the fair value of new employee stock option grants. The binomial model is affected by our stock price, as well as assumptions regarding several variables, which include, but are not limited to, our expected stock price volatility over the term of the awards, interest rates, option forfeitures and employee stock option exercise behaviors, to determine the grant date stock option award fair value.
The weighted average estimated fair value of employee stock options granted on November 1, 2021 was determined using the binomial model with the following weighted average assumptions:
November 1, 2021 Grant Details
Risk-free interest rate0.07% - 1.56%
Expected life (years)6.91
Expected volatility24.4 %
Dividend yield0.85 %
Estimated fair value$102.40
Exercise price$434.82
Fair value as a percentage of exercise price23.5 %
Non-Employee Director Stock Option Grant
The FactSet Research Systems Inc. Non-Employee Directors’ Stock Option and Award Plan as Amended and Restated (the "Director Plan") provides for the grant of share-based awards, including stock options, to non-employee directors of FactSet. The expiration date of the Director Plan is December 19, 2027. The non-qualified stock options granted to directors vest 100% after three years on the anniversary date of the grant and expire seven years from the date the options were granted. As of February 28, 2022, we had 227,348 shares available for future grant under the Director Plan.
On January 18, 2022, we granted 6,329 stock options under the Director Plan to our non-employee directors, using the Black-Scholes option-pricing model with the following assumptions:
January 18, 2022 Grant Details
Risk-free interest rate1.53 %
Expected life (years)5.7
Expected volatility26.3 %
Dividend yield0.72 %
Estimated fair value$109.11
Exercise price$428.71
Fair value as a percentage of exercise price25.5 %
Employee Restricted Stock Units
During the six months ended February 28, 2022, we granted 59,738 non-performance based restricted stock units ("RSUs") and 30,704 performance-based restricted stock units ("PSUs"; RSUs and PSUs, collectively, "Restricted Stock Awards") under the LTIP. The Restricted Stock Awards granted under the LTIP during the six months ended February 28, 2022 had a weighted average grant date fair value of $422.34.
Restricted Stock Awards are subject to continued employment over a specified period and entitle the holders to shares of common stock as the Restricted Stock Awards vest over time. Vesting of the shares underlying the PSUs are also subject to achieving certain specified performance levels during the measurement period subsequent to the date of grant. The Restricted Stock Award holder is not entitled to dividends declared on the underlying shares while the stock subject to the Restricted Stock Award is unvested. The grant date fair value of Restricted Stock Awards is measured by reducing the grant date price of the common stock by the present value of the dividends expected to be paid on the underlying stock during the requisite service period, discounted at the appropriate risk-free interest rate. The expense associated with Restricted Stock Awards is amortized over the vesting period.
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The Restricted Stock Awards granted during the six months ended February 28, 2022 were primarily related to the annual employee grant on November 1, 2021. With respect to the November 1, 2021 grant, RSUs granted vest 20% annually on the anniversary date of grant and are fully vested after five years and PSUs granted cliff vest on the third anniversary of the grant date, subject to the achievement of certain performance metrics.
Non-Employee Director Restricted Stock Units
The Director Plan provides for the grant of share-based awards, including RSUs, to non-employee directors of FactSet. On January 18, 2022, we granted 1,629 RSUs to our directors that vest 100% on the first anniversary of the grant date. The RSUs granted under the Director Plan during the six months ended February 28, 2022 had a weighted average grant date fair value of $425.49.
Employee Stock Purchase Plan
Shares of FactSet common stock may be purchased by eligible employees under the FactSet Research Systems Inc. Employee Stock Purchase Plan, as Amended and Restated (the "ESPP") in three-month intervals. The purchase price is equal to 85% of the lesser of the fair market value of our common stock on the first day or the last day of each three-month offering period. Employee purchases may not exceed 10% of their gross compensation and there is a $25,000 contribution limit per employee during an offering period. Dividends paid on shares held in the ESPP are used to purchase additional ESPP shares at the market price on the dividend payment date.
During the three months ended February 28, 2022, employees purchased 8,232 shares at a weighted average price of $351.06 compared with 9,528 shares at a weighted average price of $263.18 for the three months ended February 28, 2021. During the six months ended February 28, 2022, employees purchased 17,417 shares at a weighted average price of $340.41 compared with 18,797 shares at a weighted average price of $274.72 for the six months ended February 28, 2021. Stock-based compensation expense related to the ESPP was $0.5 million during both the three months ended February 28, 2022 and February 28, 2021. Stock-based compensation expense related to the ESPP was $1.1 million for the six months ended February 28, 2022 and $1.0 million for the six months ended February 28, 2021. As of February 28, 2022 the ESPP had 121,539 shares reserved for future issuance.
16. SEGMENTINFORMATION
Operating segments are defined as components of an enterprise that have the following characteristics: (i) they engage in business activities from which they may earn revenues and incur expenses, (ii) their operating results are regularly reviewed by the chief operating decision maker ("CODM") for resource allocation decisions and performance assessment, and (iii) their discrete financial information is available. At FactSet, our Chief Executive Officer functions as our CODM.
Our operating segments are consistent with our reportable segments and are how we, including our CODM, manage our business and the geographic markets in which we serve. Our internal financial reporting structure isdebt obligations, based on 3 segments: the Americas; EMEA; and Asia Pacific.contract maturity, were as follows:
The Americas segment serves our clients throughout North, Central, and South America. The EMEA segment serves our clients in Europe, the Middle East, and Africa. The Asia Pacific segment serves our clients in Asia and Australia. Segment revenues reflect sales to clients based in these respective geographic locations.
(in thousands)
Maturities
Fiscal Years Ended August 31,
2023 (remaining six months)$— 
2024— 
2025500,000 
2026— 
2027750,000 
Thereafter500,000 
Total$1,750,000 
Each segment records expenses related to its individual operations with the exception of expenditures associated with our data centers, third-party data costs and corporate headquarters charges, which are recorded by the Americas segment and are not allocated to the other segments. The content collection centers, located in India, the Philippines and Latvia, benefit all our segments, and the expenses incurred at these locations are allocated to each segment based on a percentage of revenues.
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The following tables reflect the results of operations of our segments as of February 28, 2022 and February 28, 2021:
(in thousands)AmericasEMEAAsia PacificTotal
For the three months ended February 28, 2022
   Revenues$273,659 $114,591 $42,869 $431,119 
   Operating income$48,903 $45,944 $28,501 $123,348 
   Capital expenditures$10,346 $252 $1,365 $11,963 
(in thousands)
For the three months ended February 28, 2021
   Revenues$247,991 $105,493 $38,304 $391,788 
   Operating income$53,614 $40,290 $22,229 $116,133 
   Capital expenditures$8,219 $314 $1,892 $10,425 
(in thousands)
For the six months ended February 28, 2022AmericasEMEAAsia PacificTotal
   Revenue$540,572 $229,594 $85,678 $855,844 
   Operating income$104,401 $86,598 $55,010 $246,009 
   Capital expenditures$17,549 $362 $2,635 $20,546 
(in thousands)
For the six months ended February 28, 2021AmericasEMEAAsia PacificTotal
   Revenue$492,327 $211,270 $76,396 $779,993 
   Operating income$109,989 $80,924 $46,250 $237,163 
   Capital expenditures$17,779 $633 $10,346 $28,758 
The following table reflects the total assets for our segments:
Segment Assets (in thousands)
February 28, 2022August 31, 2021
Americas$1,468,121 $1,144,693 
EMEA659,961 842,652 
Asia Pacific246,075 237,595 
Total assets$2,374,157 $2,224,940 

17. SUBSEQUENT EVENTS
CUSIP Global Services Acquisition
On December 24, 2021, we entered into a definitive agreement to acquire CUSIP Global Services (“CGS"), previously operated by S&P Global Inc., on behalf of the American Bankers Association, for $1.925 billion in cash, subject to a working capital adjustment. The acquisition was completed on March 1, 2022. CGS manages a database of 60 different data elements uniquely identifying more than 50 million global financial instruments. It is the foundation for security master files relied on by critical front, middle and back-office functions. CGS is the exclusive provider of Committee on Uniform Security Identification Procedures ("CUSIP") and CUSIP International Number System ("CINS") identifiers globally and also acts as the official numbering agency for International Securities Identification Number ("ISIN") identifiers in the United States and as a substitute number agency for more than 35 other countries. We anticipate that the CGS acquisition will significantly expand our critical role in the global capital markets. The purchase price for the CGS acquisition was financed from the net proceeds of the issuance of the Notes (defined below) and borrowings under the 2022 Credit Agreement (defined below).
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Revenue from CGS will be recognized based on geographic business activities in accordance with how our operating segments are currently aligned. CGS will function as part of CTS. We have not completed a preliminary allocation of the purchase price to the assets and liabilities acquired, although we expect that the majority of the purchase price will be allocated to acquired intangible assets and goodwill.
Issuance of Senior Notes
On March 1, 2022, FactSet Research Systems Inc. completed a public offering of $500.0 million aggregate principal amount of 2.900% Senior Notes due 2027 (the “2027 Notes”) and $500.0 million aggregate principal amount of 3.450% Senior Notes due 2032 (the “2032 Notes” and, together with the 2027 Notes, the “Notes”). The Notes were issued pursuant to an indenture, dated as of March 1, 2022, by and between FactSet and U.S. Bank Trust Company, National Association, as trustee, as supplemented by the supplemental indenture, dated as of March 1, 2022, between us and the Trustee (the "Supplemental Indenture"). We received net proceeds of $990.925 million from the issuance of the Notes and used such proceeds, together with cash on hand and borrowings under the 2022 Credit Agreement, to finance the consideration for the CGS acquisition, to repay borrowings under the 2019 Credit Agreement and to pay related transaction fees, costs and expenses.
The 2027 Notes and the 2032 Notes will mature on March 1, 2027 and March 1, 2032, respectively. Interest on the Notes is payable semiannually in arrears on March 1 and September 1 of each year, beginning September 1, 2022. The Notes are unsecured unsubordinated obligations and will be effectively subordinated to any of our existing and future secured obligations to the extent of the value of the assets securing such obligations.
We may redeem the Notes, in whole or in part, at any time at specified redemption prices, plus accrued and unpaid interest, if any. Upon the occurrence of a change of control triggering event (as defined in the Supplemental Indenture), we must offer to repurchase the Notes at 101% of their principal amount, plus accrued and unpaid interest, if any.
Establishment of 2022 Credit Agreement

On March 1, 2022, FactSet Research Systems Inc. entered into a credit agreement (the “2022"2022 Credit Agreement”Agreement"), which provides for a senior unsecured term loan credit facility in and borrowed an aggregate principal amount of $1.0 billion under its senior unsecured term loan credit facility (the “2022"2022 Term Facility”Facility") and a$250.0 million of the available $500.0 million under its senior unsecured revolving credit facility in an aggregate principal amount of $500.0 million (the “2022"2022 Revolving Facility”Facility" and, together with the 2022 Term Facility, the “2022 Credit Facilities”). The 2022 Term Facility matures on March 1, 2025, and the 2022 Revolving Facility matures on March 1, 2027. The 2022 Revolving Facility allows for the availability of up to $100.0 million in the form of letters of credit and up to $50.0 million in the form of swingline loans. We may seek additional commitments under the 2022 Revolving Facility from lenders or other financial institutions up to an aggregate principal amount of $750.0 million.

On March 1, 2022, we borrowed $1.0 billion underWe pay a commitment fee on the 2022 Term Facility and $250.0 million underdaily unused amount of the 2022 Revolving Facility.

The 2022 Credit Agreement provides that (i) loans denominated in U.S. dollars, at our option, will bear interest at either one-month Term Secured Overnight Financing Rate ("SOFR") (withFacility using a 10 basis points credit spread adjustment and subject to a “zero” floor), Daily Simple SOFR (with a 10 basis points credit spread adjustment and subject to a “zero” floor) or an alternate base rate, (ii) loans denominated in Pounds Sterling will bear interest at Daily Simple Sterling Overnight Index Average ("SONIA") (subject to a “zero” floor) and (iii) loans denominated in Euros will bear interest at the Euro Interbank Offered Rate ("EURIBOR") (subject to a “zero” floor), in each case, plus an applicable interest rate margin. The interest rate margin will bepricing grid based uponon our senior unsecured non-credit enhanced long-term debt rating and our total leverage ratio. We will also pay aThe commitment fee remained consistent at 0.125% from the borrowing date through February 28, 2023.
We used these borrowings, along with the net proceeds from the issuance of the Senior Notes (as defined below) and cash on hand, to finance the consideration for the CGS acquisition, to repay borrowings under the 2019 Credit Agreement (as defined below) and to pay related transaction fees, costs and expenses.
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During fiscal 2022, Revolving Facility that will fluctuate between 0.10% per annum and 0.25% per annum onwe incurred approximately $9.5 million in debt issuance costs related to the daily unused2022 Credit Facilities. Debt issuance costs are presented in the Consolidated Balance Sheets as a direct deduction from the carrying amount of the 2022 Revolving Facility.

Loans underdebt liability. Debt issuance costs are amortized to Interest expense, net in the 2022 Term Facility are subject to scheduled amortization payments in an aggregate annual amount equal to 5.0%Consolidated Statements of Income on a straight-line basis over the contractual term of the original principal amount thereof. The 2022 Credit Facilities are not otherwise subject to any mandatory prepayments. debt, which approximates the effective interest method.
We may voluntarily prepay loans under the 2022 Credit Facilities at any time without premium or penalty. During the three and six months ended February 28, 2023, we repaid $125.0 million and $250.0 million, respectively, under the 2022 Term Facility, inclusive of voluntary prepayments of $112.5 million and $225.0 million, respectively. Since loan inception on March 1, 2022, we have repaid $500.0 million under the 2022 Term Facility, inclusive of voluntary prepayments of $462.5 million.

TheAs of February 28, 2023, the outstanding borrowings under the 2022 Credit Agreement contains usual and customary affirmative and negative covenants for facilitiesFacilities bore interest at a rate equal to the applicable one-month Term SOFR rate plus a 1.1% spread (comprised of this type, including limitationsa 1.0% interest rate margin based on indebtedness of non-guarantor subsidiaries, liens, sale and leaseback transactions, mergers and certain other fundamental changes and change in nature of business.a debt leverage pricing grid plus a 0.1% credit spread adjustment). The spread remained consistent from the borrowing date through February 28, 2023. Interest on the 2022 Credit Agreement contains a financial covenant requiring maintenanceFacilities is currently payable on the last business day of a total leverage ratio which is no greater than 4.00 to 1.00 for the fiscal quarter ending on May 31, 2022.

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each month, in arrears.
The 2022 Credit Agreement contains usual and customary event of default provisions for facilities of this type, which are subject to usual and customary grace periods and materiality thresholds. If an event of default occurs under the 2022 Credit Agreement, the lenders may, among other things, terminate their commitments and declare all outstanding borrowings immediately due and payable.

The 2022 SwapCredit Agreement
As we desire to maintain contains usual and customary affirmative and negative covenants for facilities of this type, including a fixed to floating interest ratefinancial covenant requiring maintenance of a total leverage ratio of 80% on our outstanding debt portfolio,no greater than 4.00 to 1.00 as of February 28, 2023. We were in compliance with all covenants and requirements of the 2022 Credit Agreement as of February 28, 2023.
Swap Agreements
On March 5, 2020, we entered into an interest rate swap agreement ("2022 Swap Agreement") with a notional amount $800.0 million on March 1, 2022. The 2022the 2020 Swap Agreement willto hedge a portion of our then outstanding floating SOFRLIBOR rate outstanding debt with a fixed interest rate of 0.7995%. On March 1, 2022, we terminated the 2020 Swap Agreement and concurrently entered into the 2022 Swap Agreement to hedge a portion of our outstanding floating SOFR rate debt with a fixed interest rate of 1.162%. TheEffective December 30, 2022, we apportioned the then outstanding notional amount of the 2022 Swap Agreement will decline in parity with any repaymentsbetween two counterparties. Refer to Note 5, Derivative Instruments for further discussion of our Term SOFR rate debt to maintain the targeted hedging ratio of 80%. The2020 Swap Agreement and 2022 Swap Agreement matures on February 28, 2024. We have designated this instrument as a cash flow hedge and any unrealized gains or losses on the 2022 Swap Agreement will be recorded in AOCL in the Consolidated Balance Sheets.Agreement.
Termination of 2019 Credit Agreement and 2020 Swap AgreementSenior Notes
On March 1, 2022 in connectionwe completed a public offering of $500.0 million aggregate principal amount of 2.900% Senior Notes due March 1, 2027 (the “2027 Notes”) and $500.0 million aggregate principal amount of 3.450% Senior Notes due March 1, 2032 (the “2032 Notes” and, together with the entry2027 Notes, the “Senior Notes”). The Senior Notes were issued pursuant to an indenture, dated as of March 1, 2022, by and between us and U.S. Bank Trust Company, National Association, as trustee (the "Trustee"), as supplemented by the supplemental indenture, dated as of March 1, 2022, between us and the Trustee (the "Supplemental Indenture").
The Senior Notes were issued at an aggregate discount of $2.8 million during fiscal 2022 and we incurred approximately $9.1 million in debt issuance costs. Debt discounts and debt issuance costs are presented in the Consolidated Balance Sheets as a net direct deduction from the carrying amount of the debt liability. The debt discounts and debt issuance costs are amortized to Interest expense, net in the Consolidated Statements of Income over the contractual term of the debt, leveraging the effective interest method.
Interest on the Senior Notes is payable semiannually in arrears on March 1 and September 1 of each year, with the first payment made on September 1, 2022.
We may redeem the Senior Notes, in whole or in part, at any time at specified redemption prices, plus any accrued and unpaid interest. Upon the occurrence of a change of control triggering event (as defined in the Supplemental Indenture), we must offer to repurchase the Senior Notes at 101% of their principal amount, plus any accrued and unpaid interest.
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2019 Credit Agreement
On March 29, 2019, we entered into a credit agreement with PNC Bank, National Association (the "2019 Credit Agreement") and borrowed $575.0 million of the available $750.0 million provided by the revolving credit facility thereunder (the "2019 Revolving Credit Facility"). Borrowings under the 2019 Revolving Credit Facility bore interest on the outstanding principal amount at a rate equal to the daily LIBOR plus a spread using a debt leverage pricing grid. Interest on the amounts outstanding under the 2019 Revolving Credit Facility was payable quarterly, in arrears, and on the maturity date. We incurred approximately $0.9 million in debt issuance costs related to the 2019 Credit Agreement.
On March 1, 2022, Credit Agreement, we repaid in full and terminated the 2019 Credit Agreement and amortized the remaining related $0.4 million of capitalized debt issuance costs related tointo Interest expense, net in the Consolidated Statements of Income.
Interest Expense
On March 1, 2022, the 2019 Revolving Credit Agreement. TheFacility and 2020 Swap Agreement were both terminated and concurrently replaced with the 2022 Credit Facilities, Senior Notes and 2022 Swap Agreement.
The following table presents the interest expense on our outstanding debt which is included in Interest expense, net in our Consolidated Statements of Income:
Three Months EndedSix Months Ended
February 28,February 28,
(in thousands)
2023202220232022
Interest expense on outstanding debt(1)
$16,728 $1,908 $33,256 $3,826 
(1)    Interest expense on our outstanding debt includes the related amortization of debt issuance costs and debt discounts, net of the effects of the related interest rate swap agreements.
Including the related amortization of debt issuance costs and debt discounts, net of the effects of the related interest rate swap agreement, the year-to-date weighted average interest rate on amounts outstanding under our outstanding debt was 3.26% and 2.02% as of February 28, 2023 and August 31, 2022, respectively. Refer to Note 5, Derivative Instruments for further discussion of the 2020 Swap Agreement and 2022 Swap Agreement.
12. COMMITMENTS AND CONTINGENCIES
Commitments represent obligations, such as those for future purchases of goods or services, that are not yet recorded on the balance sheet as liabilities. We record liabilities for commitments when incurred (i.e., when the goods or services are received).
We accrue non-income-tax liabilities for contingencies when we believe that a loss is probable, and the amount can be reasonably estimated. Judgment is required to determine both probability and the estimated amount of loss. If the reasonable estimate of a probable loss is a range, we record the most probable estimate of the loss or the minimum amount when no amount within the range is a better estimate than any other amount. We review accruals on a quarterly basis and adjust, as necessary, to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other current information. Contingent gains are recognized only when realized.
Uncertain income tax positions are accounted for in accordance with applicable accounting guidance, refer to Note 9, Income Taxes in the Notes included in Item 8 of our Annual Report on Form 10-K for the fiscal year ended August 31, 2022 for further details.
Purchase Commitments with Suppliers and Vendors
Purchase obligations represent our legally-binding agreements to purchase fixed or minimum quantities at determinable prices. Our total purchase obligations as of August 31, 2022 primarily related to hosting services and acquisition of data, and, to a lesser extent, third-party software providers. Hosting services support our technology investments related to our transition to a hybrid cloud strategy, the majority of which rely on third-party hosting providers. Data is an integral component of the value we provide to our clients and our commitments to third-party software providers mainly include internal-use software licenses.
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As of August 31, 2022, we had total purchase obligations with suppliers of $373.9 million. During the second quarter of fiscal 2023, we amended a contract with a data supplier that resulted in an incremental commitment to purchase data of approximately $26 million.
We also terminatedhave contractual obligations related to our lease liabilities and outstanding debt. Refer to Note 10, Leases and Note 11, Debt for information regarding lease commitments and outstanding debt obligations, respectively.
Capital Commitments
As of February 28, 2023 and August 31, 2022, we had outstanding capital commitments related to an investment of $0.8 million and $1.1 million, respectively.
Letters of Credit
From time to time, we are required to obtain letters of credit in the ordinary course of business. As of both February 28, 2023 and August 31, 2022, we had $0.5 million of standby letters of credit outstanding. No liabilities related to these arrangements are reflected in the Company's Consolidated Balance Sheets.
Contingencies
Legal Matters
We are engaged in various legal proceedings, claims and litigation that have arisen in the ordinary course of business. The outcome of all the matters against us are subject to future resolution, including the uncertainties of litigation. Based on March 1, 2022,information available at February 28, 2023, our management believes that the ultimate outcome of these unresolved matters against us, individually or in the aggregate, will not have a material adverse effect on our consolidated financial position, our results of operations or our cash flows.
Income Taxes
We are currently under audit by tax authorities and have reserved for potential adjustments to our provision for income taxes that may result from examinations by, or any negotiated settlements with, these tax authorities. We believe that the final outcome of these examinations or settlements will not have a material effect on our results of operations nor our cash flows. If events occur which willindicate payment of these amounts is unnecessary, the reversal of the liabilities would result in the recognition of tax benefits in the period we determine the liabilities are no longer necessary. If our estimates of the federal, state and foreign income tax liabilities are less than the ultimate assessment, additional expense would result.
Sales Tax Matters

On August 8, 2019, we received a one-time benefitNotice of $3.5 millionIntent to Assess (the "First Notice") additional sales taxes, interest and underpayment penalties (the “Sales Taxes”) from the Commonwealth of Massachusetts Department of Revenue (the "Commonwealth") relating to the tax periods from January 1, 2006 through December 31, 2013. On July 20, 2021, we received a Notice of Intent to Assess (the "Second Notice") additional Sales Taxes from the Commonwealth relating to the tax periods from January 1, 2014 through December 31, 2018. On December 29, 2022, we received a Notice of Intent to Assess (the “Third Notice"; cumulatively with the First and Second Notices, the “Notices”) additional Sales Taxes from the Commonwealth relating to the tax periods from January 1, 2019 through June 30, 2021. We have filed an appeal with respect to the Notices to contest all Sales Taxes that may be assessed. We continue to cooperate with the Commonwealth's inquiry with respect to the Notices.
We have concluded that a payment to the Commonwealth is probable. We have recorded an accrual which is not material to our consolidated financial statements. While we believe that the assumptions and estimates used to determine the accrual are reasonable, future developments could result in adjustments being made to this accrual. If we are presented with a formal assessment for any of these matters, we believe that we will ultimately prevail; however, if we do not prevail, the amount of any assessment could have a material impact on our consolidated financial position, results of operations and cash flows.
Indemnifications

As permitted or required under Delaware law and to the maximum extent allowable under that law, we have certain obligations to indemnify each of our current and former officers and directors for certain events or occurrences while the officer or director is, or was, serving at our request in such capacity. These indemnification obligations are valid as long as the director or officer acted in good faith and in a manner the person reasonably believed to be recognizedin, or not opposed to, the best interests of FactSet, and
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with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. It is not possible to determine the maximum potential amount for claims made under the indemnification obligations due to the unique set of facts and circumstances likely to be involved in each particular claim and indemnification provision; however, we have purchased a director and officer insurance policy that mitigates our exposure and may enable us to recover a portion of any future amounts paid. We do not believe, based on historical experience and information currently available, that it is probable that any material amounts will be required to be paid under such indemnification obligations.
13. STOCKHOLDERS' EQUITY
Share Repurchases
Three Months EndedSix Months Ended
February 28,February 28,
(in thousands, except share data)2023202220232022
Repurchases of common stock under the share repurchase program(1)
— — — 46,200 
Total cost of shares repurchased(1)
$— $— $— $18,639 
(1) Amounts do not include 1,853 shares and 675 shares surrendered by grantees to satisfy withholding tax obligations due upon the vesting or exercise of stock-based awards valued at $0.8 million and $0.3 million during the three months ended February 28, 2023 and February 28, 2022, respectively. Amounts do not include 27,713 shares and 7,422 shares surrendered by grantees to satisfy withholding tax obligations due upon the vesting or exercise of stock-based awards valued at $11.8 million and $3.3 million during the six months ended February 28, 2023 and February 28, 2022, respectively.
We did not repurchase any shares of our common stock during the three months ended February 28, 2023 and February 28, 2022. We also did not repurchase any shares during the six months ended February 28, 2023 compared with 46,200 shares repurchased for $18.6 million during the same period in the prior fiscal year. Beginning in the second quarter of fiscal 2022, we suspended our share repurchase program until at least the second half of fiscal 2023, with the exception of potential minor repurchases to offset dilution from grants of equity awards or repurchases to satisfy withholding tax obligations due upon the vesting of stock-based awards. The suspension of our share repurchase program allowed us to prioritize the repayment of debt under the 2022 Credit Facilities. We anticipate resuming the existing share repurchase program for the third and fourth quarters of fiscal 2023. Refer to Note 11, Debt for more information on the 2022 Credit Facilities.
As of February 28, 2023, a total of $181.3 million remained authorized for future share repurchases under this program. There is no defined number of shares to be repurchased over a specified timeframe through the life of the share repurchase program. We may repurchase shares of our common stock under the program from time-to-time in the open market and privately negotiated transactions, subject to market conditions.
Equity-based Awards
Refer to Note 15, Stock-Based Compensation for more information on equity awards issued during the three and six months ended February 28, 2023 and February 28, 2022.

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Dividends
Our Board of Directors declared dividends during the three and six months ended February 28, 2023 and February 28, 2022 as follows:
Year EndedDividends per
Share of
Common Stock
Record Date
Total $ Amount
(in thousands)
Payment Date
Fiscal 2023
First Quarter$0.89 November 30, 2022$34,010 December 15, 2022
Second Quarter$0.89 February 28, 2023$34,099 March 16, 2023
Fiscal 2022
 First Quarter$0.82 November 30, 2021$30,973 December 16, 2021
Second Quarter$0.82 February 28, 2022$31,065 March 17, 2022
In the third quarter of fiscal 2022, our Board of Directors approved an 8.5% increase in the regular quarterly dividend from $0.82 to $0.89 per share. Future cash dividend payments will depend on our earnings, capital requirements, financial condition and other factors considered relevant by us and are subject to final determination by our Board of Directors.
Accumulated Other Comprehensive Loss
The components of AOCL are as follows:
(in thousands)February 28, 2023August 31, 2022
Accumulated unrealized gains (losses) on cash flow hedges, net of tax$7,450 $3,149 
Accumulated foreign currency translation adjustments(99,693)(111,532)
Total AOCL$(92,243)$(108,383)
14.EARNINGS PER SHARE
Basic earnings per share ("Basic EPS") is computed by dividing net income by the number of weighted average common shares outstanding during the period. Diluted earnings per share ("Diluted EPS") is computed using the treasury stock method, by dividing net income by the cumulative weighted average common shares that are outstanding or are issuable upon the exercise of outstanding stock-based compensation awards during the period. Stock-based compensation awards that are out-of-the-money and performance share units ("PSUs") in which the performance criteria have not been met as of the end of the respective reporting period are omitted from the calculation of Diluted EPS.
A reconciliation of the weighted average shares outstanding used in the Basic and Diluted EPS computation is as follows:
Three Months EndedSix Months Ended
February 28,February 28,
(in thousands, except per share data)2023202220232022
Numerator
Net income used for calculating Basic and Diluted EPS$131,593 $109,938 $268,391 $217,585 
Denominator
Weighted average common shares used in the calculation of Basic EPS38,281 37,837 38,201 37,685 
Common stock equivalents associated with stock-based compensation plan(1)
700 924 746 943 
Shares used in the calculation of Diluted EPS38,981 38,761 38,947 38,628 
Basic EPS$3.44 $2.91 $7.03 $5.77 
Diluted EPS$3.38 $2.84 $6.89 $5.63 
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(1)Dilutive potential common shares consist of stock options and unvested PSUs. As of February 28, 2023 we excluded 543,082 common stock equivalents related to stock options and as of February 28, 2022, we did not exclude any common stock equivalents related to stock options from our calculation of Diluted EPS. As of February 28, 2023 and February 28, 2022, we excluded a respective 93,308 and 95,865 common stock equivalents related to PSUs from our calculation of Diluted EPS.
15. STOCK-BASED COMPENSATION
We measure compensation expense based on the grant date fair value for all stock-based awards made to our employees and to our non-employee directors ("non-employees") using the Black-Scholes model or the lattice-binomial option-pricing model ("binomial model").
We utilize the Black-Scholes model for grants of non-employee stock options and non-employee restricted stock units ("RSUs"), and common stock acquired under the FactSet Research Systems Inc. Employee Stock Purchase Plan, as Amended and Restated ("ESPP"). We use the binomial model for grants of employee stock options and employee RSUs and PSUs. We refer to RSUs and PSUs, collectively, as "Restricted Stock Awards."
Both models involve certain estimates and assumptions such as:
Risk-free interest rate- based on the U.S. Treasury yield curve in effect at the time of grant with maturities equal to the expected terms of the stock-based awards granted.
Expected life -the weighted average period the stock-based awards are expected to remain outstanding.
Expected volatility- based on a blend of historical volatility of the stock-based award's useful life and the weighted average implied volatility for call option contracts traded in the 90 days preceding the stock-based award's valuation date.
Dividend yield -the expectation of dividend payouts based on our history.
Additionally, the binomial model incorporates market conditions, vesting restrictions and exercise patterns.
For Restricted Stock Awards, the grant date fair value is measured by reducing the grant date price of our common stock by the present value of the dividends expected to be paid on the underlying stock during the requisite service period, discounted at the appropriate risk-free interest rate.
For stock-based awards, we use the straight-line method to recognize compensation expense over the requisite service period. The amount of compensation expense that is recognized on any date is at least equal to the vested portion of the award on that date. Compensation expense for PSUs is recognized if the achievement of the performance condition is determined to be probable. We review the PSU performance conditions quarterly to ensure the compensation expense appropriately reflects the Company's expected achievement, as these awards are subject to upward or downward adjustment depending on whether the actual financial performance is above or below target levels, with the PSU payout ranging from 0% to 150% of the number of target shares. Compensation expense for stock-based awards is recorded net of estimated forfeitures, which are based on historical forfeiture rates and are revised if actual forfeitures differ from those estimates.
We recognized total stock-based compensation expense of $15.3 million and $15.5 million during the three months ended February 28, 2023 and February 28, 2022, respectively. During the six months ended February 28, 2023 and February 28, 2022, we recognized total stock-based compensation expense of $27.5 million and $25.9 million, respectively.
As of February 28, 2023, $139.7 million of total unrecognized compensation expense related to non-vested awards is expected to be recognized over a weighted average period of 3.2 years. There was no stock-based compensation capitalized as of February 28, 2023 and February 28, 2022.
As of February 28, 2023, we had 4.2 million employee stock-based awards available for grant under the FactSet Research Systems Inc. Stock Option and Award Plan, as Amended and Restated (the "LTIP"). As of February 28, 2023, we had 0.2 million non-employee stock-based awards available for grant under the FactSet Research Systems Inc. Non-Employee Directors’ Stock Option and Award Plan as Amended and Restated (the “Director Plan”).
Employee Stock Option Awards
Under the LTIP, we granted the following stock options for the six months ended February 28, 2023 and February 28, 2022, which are valued using the lattice-binomial option-pricing model. The majority of the stock options granted relate to the November 1, 2022 and November 1, 2021 annual employee grants.
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Six Months Ended
February 28,
20232022
Stock options granted(1)
267,641 302,493 
Weighted average exercise price$426.25 $434.70 
Weighted average grant date fair value$125.58 $102.45 
(1) Includes the annual employee grant on November 1, 2022 and November 1, 2021 of 266,051 and 292,377 stock options, respectively. These annual employee grantsboth vest 20% annually on the anniversary date of the grant and are fully vested after five years, expiring ten years from the date of grant.
As part of the November 1, 2022 annual employee grant, the estimated fair value of this grant leveraged the following assumptions:
November 1, 2022 Annual Employee Grant Details
Risk-free interest rate3.99% - 4.51%
Expected life (years)6.62
Expected volatility24.7%
Dividend yield0.83%
Estimated fair value$125.62
Exercise price$426.25
Non-Employee Director Stock Option Grant
On January 17, 2023, we granted 5,462 stock options under the Director Plan to our non-employee directors, which vest 100% on the first anniversary of the grant date and expire seven years from the date the options were granted, using the Black-Scholes option-pricing model with the following assumptions:
January 17, 2023 Non-Employee Director Grant Details
Risk-free interest rate3.49 %
Expected life (years)5.7
Expected volatility27.3 %
Dividend yield0.84 %
Estimated fair value$128.84
Exercise price$428.70
Employee Restricted Stock Awards
Restricted Stock Awards granted to employees, under the LTIP, entitle the holders to shares of common stock as the Restricted Stock Awards vest over time, but not to dividends declared on the underlying shares, while the stock subject to the Restricted Stock Awards is unvested. The Restricted Stock Awards are subject to continued employment over a specified period. Vesting of the shares underlying the PSUs are also subject to achieving certain specified performance levels during the measurement period subsequent to the date of grant.
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Under the LTIP, we granted the following Restricted Stock Awards with the associated weighted average grant date fair value, assuming a target payout for PSUs, for the six months ended February 28, 2023 and February 28, 2022.
Six Months Ended
February 28,
20232022
RSUs Granted(1)
47,37159,738
PSUs Granted(2)
34,48230,704
Total Restricted Stock Awards81,85390,442
Restricted Stock Awards weighted average grant date fair value$415.33 $422.34 
(1) The majority of the RSUs granted relate to the November 1, 2022 and November 1, 2021 annual employee grants that both vest 20% annually on the anniversary date of grant and are fully vested after five years.
(2) The majority of the PSUs granted relate to the November 1, 2022 and November 1, 2021 annual employee grants that both cliff vest on the third anniversary of the grant date, subject to the achievement of certain performance metrics. The ultimate number of common shares that may be earned pursuant to these PSU awards range from 0% to 150% of the number of target shares, depending on the level of the Company's achievement of stated financial performance objectives.
Non-Employee Director Restricted Stock Units
The Director Plan provides for the grant of stock-based awards, including RSUs, to non-employee directors of FactSet. On January 17, 2023, we granted 1,653 RSUs to our directors that vest 100% on the first anniversary of the grant date. The RSUs granted to our directors on January 17, 2023 had a grant date fair value of $425.06.
Employee Stock Purchase Plan
Shares of FactSet common stock may be purchased by eligible employees under our ESPP in three-month intervals. The purchase price is equal to 85% of the lesser of the fair market value of our common stock on the 2020 Swap Agreementfirst day or the last day of each three-month offering period. Employee purchases may not exceed 10% of their gross compensation, and there is a $25,000 contribution limit per employee during an offering period. Shares purchased through our ESPP cannot be sold or otherwise transferred for 18 months after purchase. Dividends paid on shares held in our ESPP are used to purchase additional ESPP shares at the market price on the dividend payment date.
Stock-based compensation expense related to our ESPP was $0.6 million for the three months ended February 28, 2023 and $0.5 million for the three months ended February 28, 2022. Stock-based compensation expense related to our ESPP was $1.3 million for the six months ended February 28, 2023 and $1.1 million for the six months ended February 28, 2022. As of February 28, 2023, our ESPP had 84,576 shares reserved for future issuance.
16. SEGMENTINFORMATION
Operating segments are defined as components of an enterprise that have the following characteristics: (i) they engage in business activities from which they may earn revenue and incur expense, (ii) their operating results are regularly reviewed by the chief operating decision maker ("CODM") for resource allocation decisions and performance assessment, and (iii) their discrete financial information is available. Our Chief Executive Officer functions as our CODM.
Our operating segments are consistent with our reportable segments and how we, including our CODM, manage our business and the geographic markets in which we serve. Our internal financial reporting structure is based on three segments: the Americas; EMEA; and Asia Pacific.
The Americas segment serves our clients throughout North, Central, and South America. The EMEA segment serves our clients in Europe, the Middle East, and Africa. The Asia Pacific segment serves our clients in Asia and Australia. Segment revenues reflect sales to our clients based on their respective geographic locations.
Each segment records expenses related to its individual operations with the exception of expenditures associated with our data centers, third-party data costs and corporate headquarters charges, which are recorded by the Americas segment and are not allocated to the other segments. The content collection centers, located in India, the Philippines and Latvia, benefit all our segments, and the expenses incurred at these locations are allocated to each segment based on a percentage of revenues.
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The following tables reflect the results of operations of our segments as of the termination date.February 28, 2023 and February 28, 2022:
(in thousands)AmericasEMEAAsia PacificTotal
For the three months ended February 28, 2023
Revenues$331,121 $132,508 $51,456 $515,085 
Operating income$61,181 $68,941 $39,128 $169,250 
Capital expenditures(1)
$15,589 $739 $1,128 $17,456 
(in thousands)AmericasEMEAAsia PacificTotal
For the three months ended February 28, 2022
Revenues$273,659 $114,591 $42,869 $431,119 
Operating income(2)
$48,903 $45,944 $28,501 $123,348 
Capital expenditures(1)
$10,346 $252 $1,365 $11,963 
(in thousands)
For the six months ended February 28, 2023AmericasEMEAAsia PacificTotal
Revenues$654,488 $263,246 $102,166 $1,019,900 
Operating income$128,712 $136,263 $76,170 $341,145 
Capital expenditures(1)
$31,343 $1,312 $2,761 $35,416 
(in thousands)
For the six months ended February 28, 2022AmericasEMEAAsia PacificTotal
Revenues$540,572 $229,594 $85,678 $855,844 
Operating income(2)
$104,401 $86,598 $55,010 $246,009 
Capital expenditures(1)
$17,549 $362 $2,635 $20,546 

(1)
Capital expenditures includes purchases of property, equipment, leasehold improvements and capitalized internal-use software.

(2)
Asset impairments incurred during the three and six months ended February 28, 2022 were $10.3 million ($10.2 million recognized in the Americas) and $14.0 million ($13.9 million recognized in the Americas), respectively. This impairment primarily related to vacating certain leased office space resulting in an impairment to our lease ROU assets and associated property, equipment and leasehold improvements. Refer to Note 4, Fair Value Measures and Note 10, Leases for more information on the impairment.

Segment Total Assets

The following table reflects the total assets for our segments:


(in thousands)February 28, 2023August 31, 2022
Segment Assets
Americas$3,189,973 $3,191,313 
EMEA561,294 580,450 
Asia Pacific249,808 242,542 
Total assets$4,001,075 $4,014,305 

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This Management’s Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") should be read in conjunction with the Consolidated Financial Statements and related notesNotes included in this Quarterly Report on Form 10-Q, our Annual Report on Form 10-K for the fiscal year ended August 31, 2021,2022, our Current Reports on Form 8-K and our other filings with the Securities and Exchange Commission. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those discussed below. Factors that could cause such differences include, but are not limited to, those identified below and those discussed in Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended August 31, 2021.2022.
Our MD&A is designed to provide a reader of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity and certain other factors that may affect our future results. Our MD&A is presented in the following sections:
Executive Overview
Annual Subscription Value ("ASV")
Client and User Additions
Employee Headcount
Results of Operations
Non-GAAP Financial Measures
Liquidity and Capital Resources
Off-Balance Sheet Arrangements
Foreign Currency Exposure
Critical Accounting Policies and Estimates
New Accounting Pronouncements
Executive Overview
FactSet Research Systems Inc. and its wholly-owned subsidiaries (collectively, "we," "our," "us," the "Company" or "FactSet") is a global financial datadigital platform and analytics companyenterprise solutions provider with an open and flexible digital platform which focuses on drivingsolutions that drive the investment community to see more, think bigger and do its best work. Our strategy is to build the leading open content and analytics platform that delivers a differentiated advantage for our clients’ success.
For over 40 years,Fiscal 2023 marks the FactSet45th year our platform has delivered expansive data, sophisticated analytics, and flexible technology thatused by global financial professionals need to power their critical investment workflows. MoreAs of February 28, 2023, we had more than 171,0007,700 clients comprised of approximately186,000 investment professionals, including asset managers, asset owners, bankers, wealth managers, asset owners, channel partners, hedge funds, corporate users, private equity and venture capital professionals,professionals. Our on- and others use our personalizedoff-platform solutions to identify opportunities, explore ideas, and gain a competitive advantage. Our solutions span the investment lifecycle including investment research, portfolio construction and analysis, trade execution, performance measurement, risk management and reporting across the investment lifecycle.reporting. Our revenues are primarily derived from subscriptions to our multi-asset class data and solutions powered by our connected content, referred to as our "content refinery." Our products and services include workstations, portfolio analytics and enterprise solutions.
We provide financial data and market intelligence on securities, companies, industries and people to enable our clients to research investment ideas, as well as offering them the capabilities to analyze, monitor and manage their portfolios. We combine dedicated client service with open and flexible technology offerings, such asincluding a configurable desktop and mobile platform, comprehensive data feeds, cloud-based digital solutions and application programming interfaces ("APIs"). Our revenues are primarily derived from subscriptions to our productsCUSIP Global Services ("CGS") business supports security master files relied on by the investment industry for critical front, middle and services such as workstations, portfolio analytics, and market data.back office functions.
We advancedrive our industry by comprehensivelybusiness based on our detailed understanding of our clients’ workflows, solvingwhich helps us to solve their most complex challenges, and helping them achieve their goals. By providingchallenges. We provide them with the leadingan open contentdigital platform, connected and analytics platform, an expansive universe of concordedreliable data, they can trust, next-generation workflow support designed to help them growsolutions and see their next best action, and the industry’s mosthighly committed service specialists, we put our clients in a position to outperform.specialists.
We are focused on growingoperate our business through three reportable segments ("segments"):segments: the Americas, EMEA and Asia Pacific. Refer to Note 16, Segment Information,, in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for further discussion. WithinFor each of our segments, we deliver insight and informationexecute our strategy through our three workflows:workflow solutions: Research & Advisory Solutions;Advisory; Analytics & Trading Solutions;Trading; and Content & Technology Solutions ("CTS").
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Business Strategy
ClientAs the needs and market dynamics continue toof our clients evolve, at an accelerated pace with an increasing demand for differentiated,they seek personalized and connected data, an ongoing shift totools for multi-asset class investing and cost rationalization as the shift from active to passive investing continues.increased efficiencies. Clients are also seeking new cloud-based solutions, that enable self-service and automation, open and flexible systems and increased efficiencies when integrating and managing data as part ofto support their own broader digital transformations.
FactSet’sOur strategy focuses on buildingis to build the leading open content and analytics platform that deliversto deliver differentiated advantages for our clients’ success, in keeping with our purpose of enabling the investment community to see more, think bigger and do their best work. We want to be the trusted partner of choice for clients, to anticipate their needs and provide them with the most innovative solutions to make them more efficient. This includes transforming the way our clients discover, decide, and act on an opportunity using our digital platform; purposefully increasing our pace and speed to market by streamlining how we work; and investing in our future workforce.success. To execute on ourthis strategy, we plan on the following:on:
Growing our digital platform: ScalingWe are scaling up our content refinery by providing the mostto offer a comprehensive and connected inventory of industry, proprietary and third-party data for the financial community, includingcommunity. This data includes granular data for key industry verticals, private companies, wealth management, real-time data and environmental social and governance ("ESG"). Driving next-generationsustainable finance. We are driving personalized workflow solutions by creating personalized and integrated solutions to streamline workflows which includes solutions for financial professionals, including asset managers, bankers, wealth managers, asset owners, sell side, wealthchannel partners, hedge funds, corporate users and corporate clients.private equity and venture capital professionals. Our goal is to deliver tangible efficiencies to our clients by connectingoffer an open ecosystem of cloud-based data and analytics, with a cloud based eco-system,providing solutions and content that is accessible and flexible through many delivery methods, enabling themour clients to more efficiently manage work more effectively through an integrated investment lifecycle.their workflows.
Delivering execution excellence: BuildingWe strive to be innovative and collaborative across our organization to remain responsive, flexible and agile. Our open ecosystem provides a more agile and digital first-minded organization that increases the speed of our product creation and go-to-market strategy. To capitalize on market trends and give our clients innovative tools, we plan to release new products built on a cloud-based digital foundation as well as migratingthat powers client personalization and efficiency, firm-type product development and core process automation. We employ technology to accelerate content collection for industry, proprietary and third-party data. Additionally, our existing datasales force is improving price realization by focusing on productivity, efficiency and applicationsimproved client outcomes. We are also optimizing our operations and managing our expenses to improve returns on our investments in people and product. Finally, we are committed to promoting a modern work environment that preserves the cloud. Additionally, we expect to rationalize our existing product portfolio to reinvest in higher return products.benefit of flexibility while retaining talent, fostering creativity, innovation, and collaboration, and enabling mentorship.
Driving a growth mindset: Recruiting,To drive sustainable growth, we are recruiting, training and empowering a diverse and operationally efficient workforce to drive sustainable growth. To driveworkforce. As a more performance-based culture, we are investing in talent whothat can create leading technological solutions and efficiently execute our go-to-market strategystrategy. We use partnerships and achieveacquisitions to accelerate our growth targets.in strategic areas.
At the center of ourOur strategy is thecenters on a relentless focus on our clients and their FactSet experience. We wantaim to be a trusted partner and service provider, offering hyper-personalizedpersonalized digital products for clientspowered by cognitive computing to research ideas and uncover relevant insights, and leverage cognitive computing to help get the most out of their data and analytics.insights. Additionally, we continually evaluate business opportunities such as partnerships and acquisitions and partnerships to help us expandincrease our capabilities and competitive differentiators across the investment portfolio lifecycle.differentiation.
We are focused on growing our global business inthrough three segments: the Americas, EMEA and Asia Pacific. We believe this geographicalgeographic strategic alignment helps us better manage our resources, target our solutions and interact with our clients. We further execute on our growth strategy by offering data, products and analytical applications within our three workflow solutions: Research & Advisory; Analytics & Trading; and CTS.
Fiscal 20222023 Second Quarter in Review
Revenues in the second quarter of fiscal 20222023 were $431.1$515.1 million, an increase of 10.0%19.5% from the prior year comparable period. Revenues increased across each ofall our geographic segments, primarily in the Americas followed byand, to a lesser extent, EMEA and Asia Pacific,Pacific. The increased revenues were supported by increased revenueshigher sales in alleach of our workflow solutions, mainly in CTS (driven by the acquisition of CGS), followed by Research & Advisory followed byand Analytics & Trading, and CTS.when compared with the prior year. Organic revenues contributed to 9.9%8.9% of theour growth during the second quarter of fiscal 2022,2023, compared with the prior year period. Organic revenues exclude the effects of acquisitions and dispositions completed in the last 12 months, the impacts of foreign currency movements on the current year period and the amortization of deferred revenues' fair value adjustments from purchase accounting. Refer to Part I, Item 2. Non-GAAP Financial Measures in Part I, Item 2the MD&A of this Quarterly Report on Form 10-Q for a reconciliation between revenues and organic revenues.
As of February 28, 2022,2023, organic annual subscription value ("Organic ASV") plus Professional Services totaled $1.74$1.9 billion, an increase of 9.4%9.1% over February 28, 2021.2022. Organic ASV increased across all our segments, with the majority of the increase
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related to the Americas followed byand, to a lesser extent, EMEA and Asia Pacific.Pacific, supported by increases in our workflow solutions, mainly from Research & Advisory and Analytics & Trading, and, to a lesser extent, CTS. Refer to Part I, Item 2 Annual Subscription Value in Part I, Item 2the MD&A of this Quarterly Report on Form 10-Q for the definitions of Organic ASV and Organic ASV plus Professional Services.
Operating income grew 6.2%margin increased to 32.9% during the three months ended February 28, 2023, compared with 28.6% in the prior year period. This increase was mainly due to growth in revenues and diluteda decrease in employee compensation costs, as well as asset
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impairment charges recorded in the prior year period, when expressed as a percentage of revenues. The margin improvement was further driven by a decrease in occupancy costs and professional fees, partially offset by higher amortization of intangible assets and royalty fees, when expressed as a percentage of revenues.
Diluted earnings per share ("EPS") increased 13.6%19.0% for the three months ended February 28, 20222023, compared with the prior year period. Operating margin decreased to 28.6% during the three months ended February 28, 2022 compared with 29.6% in the prior year period. This decrease in operating margin on a year-over-year basis was primarily due to impairment charges related to vacating certain leased office space and higher professional fees driven by costs incurred in preparation for the acquisition of CUSIP Global Services (“CGS"), partially offset by growth in revenues and lower costs related to employee compensation and computer depreciation, when expressed as a percentage of revenue.
CUSIP Global Services Acquisition
On December 27,24, 2021, we entered into a definitive agreement to acquire CGS previously operated by S&P Global Inc. on behalf of the American Bankers Association, for $1.925$1.932 billion in cash, subject to ainclusive of working capital adjustment.adjustments. The acquisition was completed on March 1, 2022. CGS manages a database of 60 different data elements uniquely identifying more than 50 million global financial instruments. It is the foundation for security master files relied on by critical front, middle and back-office functions. CGS is the exclusive provider of Committee on Uniform Security Identification Procedures ("CUSIP") and CUSIP International Number System ("CINS") identifiers globally and also acts as the official numbering agency for International Securities Identification Number ("ISIN") identifiers in the United States. We anticipatebelieve that the CGS acquisition will significantly expand our critical role in the global capital markets. RevenueRevenues from CGS will beare recognized based on geographic business activities in accordance with how our operating segments are currently aligned. CGS will functionfunctions as part of CTS.
The purchase price for the CGS acquisition was financed from the net proceeds of the issuance of the Senior Notes and borrowings under the 2022 Credit Agreement. In connection with the entry into the 2022 Credit Agreement, on March 1, 2022, we entered into the 2022 Swap Agreement and repaid in full and terminated the 2019 Credit Agreement and the 2020 Swap Agreement. Facilities. Refer to Note 17,6, Subsequent EventsAcquisitions ,andNote 11, Debt in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for more information on these defined terms, our acquisition of CGS, the issuanceand our defined terms of theSenior Notes and the 2022 Credit Agreement and the 2022 Swap Agreement.Facilities, respectively.
COVID-19 Update
A novel strain of coronavirus, now known as COVID-19 ("COVID-19"), was first reported in December 2019, and it has since extensively impacted the global health and economic environment, with the World Health Organization characterizing COVID-19 as a pandemic on March 11, 2020. In response to the COVID-19 pandemic, we implemented a business continuity plan with a dedicated incident management team to respond quickly and provide ongoing guidance so that we could continue offering our clients uninterrupted products, services and support while also protecting our employees. We believe these actions have been successful and that the pandemic, and our responses, have not significantly affected our financial results for the three and six months ended February 28, 2022.
At the outset of the pandemic, we required the vast majority of our employees at our offices across the globe (including our corporate headquarters) to work remotely and implemented global travel restrictions for our employees. Since that time, we have begun to re-open many of our offices globally with a focus on safety, while acting consistently with applicable local regulations. We anticipate that the ability to open offices will vary significantly from region to region based on a number of factors, including the availability of COVID-19 vaccines and the spread of COVID-19 variants. Our offices will not re-open fully until local authorities permit us to do so and our own criteria and conditions to ensure employee health and safety are satisfied.
As of February 28, 2022, there have been minimal interruptions in our ability to provide our products, services and support to our clients. Working remotely has had relatively little impact on the productivity of our employees, including our ability to gather content. We continue to work closely with our clients to provide consistent access to our products and services and have remained flexible to achieve client priorities.
Based on our success working in a remote environment during the COVID-19 pandemic, we have implemented a new work standard under which employees in many of our locations, where permitted by local laws and regulations, and where the role permits, will have the opportunity to choose between different work arrangements. These include working in a hybrid arrangement, where an employee can split time between working from the office and working from a pre-approved remote location, or a fully remote arrangement, where an employee can work entirely from a pre-approved remote location.
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Our revenues, earnings, and ASV are relatively stable and predictable as a result of our subscription-based business model. To date, the COVID-19 pandemic has not had a material negative impact on our revenues, earnings or ASV. As we continue to work in remote and hybrid environments, reductions in discretionary spending, particularly travel and entertainment, have more than offset any related increased expenses. Given our transition to our new work standard, we anticipate that many of these expense reductions will continue going forward, including incurring less travel and entertainment spending than we did pre-pandemic. We also are reassessing our real estate footprint to better reflect these new work arrangements and seeking to reduce our spending on office space that will no longer be necessary.2023.
Refer to Part I, Item 1. Business, Human Capital Management, How We Work and Item 1A. Risk Factors, Operational Risks of our Annual Report on Form 10-K for the fiscal year ended August 31, 20212022 for further discussion of the potential impact of the COVID-19 pandemic on our business.
Ukraine/Russia Conflict
As the Russian invasion ofmilitary conflict between Russia and Ukraine continuesis ongoing, we continue to evolve, we are closely monitoringmonitor the current and potential impact on our business, our people and our clients. We have taken all necessary steps to ensure compliance with all applicable regulatory restrictions on international trade and financial transactions. On March 18, 2022,In Russia, we announced that we are discontinuinghave discontinued all commercial operations and delivery of products and services to clients inside Russia. In addition, weclients; have identifiedterminated all active vendors in Russia and are terminating our contracts with them. Wevendors; and have suspended all new business, trials and prospecting activities in Russia.activities. Total revenues associated with clients in Russia arewere not material to our consolidated financial results, and we anticipate termination of Russian vendors willhas not havehad a material impact on our business or client relationships. We have no offices in Russia or Ukraine, and none of our employees or contractors has been directly impacted by the crisis.conflict. We are monitoringcontinue to monitor the regional and global ramifications of the unfolding events in the area, are in close contact with our office in Latvia,including the threatened disruptions to global energy markets, and are reviewing our business continuity plans to ensure that we are prepared in the event this office isany of our offices are impacted. Our cybersecurity teams are on high alert and ready to respond in the event of anany attempted systems compromise.
Annual Subscription Value ("ASV")

We believe ASV reflects our ability to grow recurring revenues and generate positive cash flow, and is thea key indicator of the successful execution of our business strategy.

"ASV" at any point in time represents our forward-looking revenues for the next 12 months from all subscription services currently being supplied to clients, excluding revenues from Professional Services.
"Organic ASV" at any point in time equals our ASV excluding ASV from acquisitions and dispositions completed within the last 12 months and the effects of foreign currency movements on the current year period.movements.
"Professional Services" are revenues derived from project-based consulting and implementation.implementation, annualized over the past 12 months.
"Organic ASV plus Professional Services" at any point in time equals the sum of Organic ASV and Professional Services.
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Organic ASV plus Professional Services

The following table presents the calculation of Organic ASV plus Professional Services as of February 28, 2022.2023. With proper notice provided as contractually required, our clients can add to, delete portions of, or terminate service, subject to certain limitations.
(dollar amounts in millions)As of February 28, 20222023
As reported ASV plus Professional Services(1)
$1,750.22,074.0 
Currency impact(2)
0.9 (1.0)
Acquisition ASV(3)
(7.2)(171.3)
Organic ASV plus Professional Services$1,743.91,901.7 
Organic ASV plus Professional Services growth rate9.49.1 %
(1)Includes $24.2$23.2 million in Professional Services as of February 28, 2022.Services.
(2)The impact from foreign currency movements.
(3)Acquired ASV from acquisitions completed within the last 12 months.

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As of February 28, 2022,2023, Organic ASV plus Professional Services was $1.74$1.9 billion, an increase of 9.4%9.1% compared with February 28, 2021. The increase in year-over-year2022. Organic ASV was largely attributedincreased due mainly to increased sales to existing clients followed byand, to a lesser extent, price increases to existing clients and new client sales, and price increases, partially offset by existing client cancellations.

Organic ASV increased across all our geographic segments, with the majority of the increase related to the Americas, followed by EMEA and Asia Pacific. This increase was driven by additional sales in our workflow solutions, primarily in Research & Advisory followed byand Analytics & Trading, and, to a lesser extent, CTS. Sales increased in Research & Advisory mainly due to higher demand for our workstations. Sales increased in Analytics & Trading mainly from our portfolio analytics solutions, and performance and reporting products. CTSproducts and portfolio and benchmark services. CTS sales increased primarily due to company financial data, such as fundamentals and estimates, along withmainly from our data management solutions, to empowercompany data connectivity.and real time data solutions.
Segment ASV
As of February 28, 2022,2023, ASV from the Americas represented 62.9%64% of total ASV and was $1,085.6$1,315.3 million, an increase from $985.2$1,085.6 million as of February 28, 2021.2022. Americas Organic ASV increased to $1,079.3$1,188.6 million as of February 28, 2022,2023, a 9.6%9.3% increase compared with February 28, 2021.from the prior year period. The Organic ASV increase in the Americas was primarily driven by increased sales of Research & Advisory and Analytics & Trading.
As of February 28, 2022,2023, ASV from EMEA was $459.9 million, representing 26.6%represented 26% of total ASV and was $528.5 million, an increase from $427.6$459.9 million as of February 28, 2021.2022. EMEA Organic ASV increased to $459.6$494.3 million as of February 28, 2022,2023, a 7.8%8.1% increase compared with February 28, 2021.from the prior year period. The EMEA Organic ASV increase was mainly driven by higher sales of Analytics & Trading, CTS and Research & Advisory.
As of February 28, 2022,2023, ASV from Asia Pacific ASV was $180.5 million, representing 10.5%represented 10% of total ASV and was $207.1 million, an increase from $159.8$180.5 million as of February 28, 2021.2022. Asia Pacific Organic ASV increased to $180.9$195.6 million as of February 28, 2022,2023, a 14.3%10.8% increase compared with February 28, 2021.
The increase in Organic ASV across all our segments was largely attributed to increased sales to existing clients, followed by new client sales and price increases, partially offset by existing client cancellations. Organic ASV increased infrom the Americas primarily due to higher sales in Research & Advisory, followed by Analytics & Trading. EMEA Organic ASV increased due to higher sales in Research & Advisory, followed by CTS and Analytics & Trading.prior year period. The increase in Asia Pacific Organic ASV increase was mainly driven by higherprimarily due to increased sales inof Research & Advisory followed byand Analytics & Trading and CTS.Trading.
Buy-side and Sell-side Organic ASV Growth
Buy-sideThe buy-side and sell-side Organic ASV growth rates at February 28, 2022,2023, compared with February 28, 2021,2022, were 8.8%8.1% and 12.9%15.8%, respectively. Buy-side clients account for approximately 84%83% of our Organic ASV, consistent with the prior year period, and primarily include asset managers, wealth managers, asset owners, channel partners, hedge funds, and corporate firms. The remainder of our Organic ASV is derived from sell-side firms and primarily include broker-dealers, banking and advisory, private equity and venture capital firms.
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Client and User Additions
The table below presents our total clients and users:
As of February 28, 2022As of February 28, 2021ChangeAs of February 28, 2023As of February 28, 2022Change
Clients(1)
Clients(1)
7,172 6,103 17.5 %
Clients(1)
7,730 7,172 7.8 %
UsersUsers171,341 153,355 11.7 %Users186,463 171,341 8.8 %
(1)The client count includes clients with ASV of $10,000 and above.
Our total client count was 7,1727,730 as of February 28, 2022,2023, a net increase of 17.5%,7.8% or 1,069558 clients in the last 12 months, mainly due to an increase in corporate andclients, wealth management clients. As partclients and channel partners. We believe this increase was primarily due to our expanded suite of client-centric workflow solutions, our long-term growth strategy, we continue to focus on expandingcontent refinery and cultivating relationships withcontinued execution excellence by our existingsales and client base through our on- and off-platform workflow-focused solutions, connected content and client-focused services.facing teams.
As of February 28, 2022,2023, there were 171,341186,463 professionals using FactSet, representing a net increase of 11.7%,8.8% or 17,98615,122 users in the last 12 months, primarily driven primarily by an increase of banking and private equity and venture capital clients from the sell-side and asset managers, corporate and wealth management clients from the buy-side. The increase in users was mainly due to the addition of new clients and increased new hiring at our banking clients.
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firms.
Annual clientASV retention was greater than 95% of ASV and 92% when expressed as a percentage of clients for the period ended February 28, 2022,2023, with both percentages consistent with the prior year period. When expressed as a percentage of clients, annual retention was approximately 92% for the period ended February 28, 2022, an improvement from approximately 90% for the period ended February 28, 2021.
Employee Headcount
As of February 28, 2022,2023, our employee headcount was 11,896, an increase of 10.3% compared with 10,784 up 1.2%employees as of February 28, 2022. This growth in the past 12 months from 10,660,headcount was primarily due primarily to an increase in net new employees of 5.2%10.4% in Asia Pacific, partially offset by a decrease of 9.0%12.1% in the Americas and 0.1%6.8% in EMEA. Of our total employee headcount atAt February 28, 2022, 7,1472023, 7,891 employees were located in Asia Pacific, 2,265 were located2,540 in the Americas, and 1,372 were located1,465 in EMEA.
Results of Operations
For an understanding of the significant factors that influenced our performance for the three and six months ended February 28, 20222023 and February 28, 2021,2022, the following discussion should be read in conjunction with the Consolidated Financial Statements and related notesNotes presented in this Quarterly Report on Form 10-Q.
The following table summarizes the results of operations for the periods described:
Three Months EndedSix Months EndedThree Months EndedSix Months Ended
February 28,% ChangeFebruary 28,% Change February 28,% ChangeFebruary 28,% Change
(in thousands, except per share data)2022202120222021% Change
(dollar amounts in thousands, except per share data)(dollar amounts in thousands, except per share data)202320222023% Change2022% Change
RevenuesRevenues$431,119 $391,788 10.0 %$855,844 $779,993 9.7 %Revenues$515,085 $431,119 $1,019,900 19.2 %
Cost of servicesCost of services$199,395 $195,523 2.0 %$406,544 $383,611 6.0 %Cost of services240,806 199,413 20.8 %$467,848 $406,544 15.1 %
Selling, general and administrativeSelling, general and administrative$108,376 $80,132 35.2 %$203,291 $159,219 27.7 %Selling, general and administrative104,582 98,066 6.6 %$210,178 $189,304 11.0 %
Asset impairmentsAsset impairments447 10,292 (95.7)%$729 $13,987 (94.8)%
Operating incomeOperating income$123,348 $116,133 6.2 %$246,009 $237,163 3.7 %Operating income$169,250 $123,348 37.2 %$341,145 $246,009 38.7 %
Net incomeNet income$109,938 $96,643 13.8 %$217,585 $197,849 10.0 %Net income$131,593 $109,938 19.7 %$268,391 $217,585 23.3 %
Diluted weighted average common sharesDiluted weighted average common shares38,981 38,761 38,947 38,628 
Diluted earnings per common shareDiluted earnings per common share$2.84 $2.50 13.6 %$5.63 $5.12 10.0 %Diluted earnings per common share$3.38 $2.84 19.0 %$6.89 $5.63 22.4 %
Diluted weighted average common shares38,761 38,620 38,628 38,658 
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Revenues
Three months ended February 28, 20222023 compared with three months ended February 28, 20212022
Revenues for the three months ended February 28, 20222023 were $431.1$515.1 million, an increase of 10.0%of 19.5%. The increase in revenues was primarily driven by increased sales to existing clients and, to a lesser extent, price increases to existing clients and new client sales, partially offset by existing client cancellations. Revenues increased across all our segments, primarily from the Americas and, to a lesser extent, by EMEA and Asia Pacific. The increased revenues were largely attributedsupported by higher sales in each of our workflow solutions, mainly in CTS (driven by the acquisition of CGS), followed by Research & Advisory and Analytics & Trading. Organic revenues increased to $469.5 million for the three months ended February 28, 2023, an 8.9% increase over the prior year period. Refer to Part I, Item 2. Non-GAAP Financial Measures in the MD&A of this Quarterly Report on Form 10-Q for further discussion on organic revenues.
The growth in revenues of 19.5% was reflective of organic revenues growth of 8.9% and an 11.0% increase primarily due to the impact of acquisition-related revenues, partially offset by a 0.4% decrease from foreign currency exchange rate fluctuations.
Six months ended February 28, 2023 compared with six months ended February 28, 2022
Revenues for the six months ended February 28, 2023 was $1,019.9 million, an increase of 19.2%. The increase in revenues was mainly due to increased sales to existing clients, inclusive of price increases, followed by new client sales, partially offset by existing client cancellations. Revenues increased across all our geographic segments, primarily from the Americas, followed by EMEA and Asia Pacific, driven byPacific. The increased revenues were supported by higher sales in alleach of our workflow solutions, primarily in CTS (driven by the acquisition of CGS), followed by Research & Advisory followed byand Analytics & Trading and CTS, compared with the prior year.Trading. Organic revenues increased to $430.8$929.4 million for the threesix months ended February 28, 2022, a 9.9%2023, an 8.6% increase over the prior year period.
The 10.0% increasegrowth in revenues of 19.2% was composedreflective of organic revenue growth in organic revenues of 9.9%8.6% and a 50 basis pointan 11.2% increase from deferred revenues fair value adjustments from purchase accounting andprimarily related to acquisition-related revenues,revenue, partially offset by a 40 basis point0.6% decrease from foreign currency exchange rate fluctuations.
Six months ended February 28, 2022 compared with six months ended February 28, 2021
Revenues for the six months ended February 28, 2022 was $855.8 million, an increase of 9.7%. The increase in revenues were largely attributed to increased sales to existing clients, inclusive of price increases, followed by new client sales, partially offset by existing client cancellations. Revenues increased across all our geographic segments, primarily from the Americas, followed by EMEA and Asia Pacific driven by increased revenues in all of our workflow solutions, primarily in Research & Advisory, followed by Analytics & Trading and CTS, compared with the prior year. Organic revenues increased to $853.9 million for the six months ended February 28, 2022, a 9.4% increase over the prior year period.
The revenue growth of 9.7% was reflective of organic revenue growth of 9.4%, a 60 basis point increase from deferred revenue fair value adjustments from purchase accounting and acquisition-related revenue, partially offset by a 30 basis point decrease from foreign currency exchange rate fluctuations.
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Revenues by Segment
 Three Months EndedSix Months Ended
February 28,% ChangeFebruary 28,% Change
(in thousands)2022202120222021
Americas$273,659 $247,991 10.4 %$540,572 $492,327 9.8 %
% of revenues63.5 %63.3 %63.2 %63.1 %
EMEA$114,591 $105,493 8.6 %$229,594 $211,270 8.7 %
% of revenues26.6 %26.9 %26.8 %27.1 %
Asia Pacific$42,869 $38,304 11.9 %$85,678 $76,396 12.1 %
% of revenues9.9 %9.8 %10.0 %9.8 %
Consolidated$431,119 $391,788 10.0 %$855,844 $779,993 9.7 %
The following table summarizes our revenues by segment for the periods described:
 Three Months EndedSix Months Ended
February 28,% ChangeFebruary 28,% Change
(dollar amounts in thousands)2023202220232022
Americas$331,121 $273,659 21.0 %$654,488 $540,572 21.1 %
% of revenues64.3 %63.5 %64.2 %63.2 %
EMEA$132,508 $114,591 15.6 %$263,246 $229,594 14.7 %
% of revenues25.7 %26.6 %25.8 %26.8 %
Asia Pacific$51,456 $42,869 20.0 %$102,166 $85,678 19.2 %
% of revenues10.0 %9.9 %10.0 %10.0 %
Consolidated$515,085 $431,119 19.5 %$1,019,900 $855,844 19.2 %
Three months ended February 28, 20222023 compared with three months ended February 28, 20212022
Americas
Revenues from our Americas segmentrevenues increased 10.4%21.0% to $273.7$331.1 million during the three months ended February 28, 2022,2023, compared with $248.0$273.7 million from the same period a year ago. The increased revenues were driven by higher sales in all of our workflow solutions, primarily in Research & Advisory, followed by Analytics & Trading and CTS. The growth in revenues of 10.4%21.0% was reflective of increasedan 8.2% increase in organic revenues of 10.3% and a 10 basis point12.8% increase related to deferred revenues fair value adjustments from purchase accounting and acquisition-related revenues.

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EMEA
Revenues from our EMEA segmentrevenues increased 8.6%15.6% to $114.6$132.5 million during the three months ended February 28, 2022,2023, compared with $105.5$114.6 million from the same period a year ago. The increased revenues were driven by higher sales in all of our workflow solutions, primarily in Research & Advisory, followed by Analytics & Trading and CTS. The growth in revenues of 8.6%15.6% was reflective of increasedan 8.2% increase in organic revenues of 9.5%,and an 8.1% increase from acquisition-related revenues, partially offset by a 90 basis point0.7% decrease related todriven by the effects of foreign currency exchange rate fluctuations.
Asia Pacific
Revenues from our Asia Pacific segmentrevenues increased 11.9%20.0% to $42.9$51.5 million during the three months ended February 28, 2022,2023, compared with $38.3 million from the same period a year ago. The increased revenues were driven by increased sales across all of our workflow solutions of Analytics & Trading, Research & Advisory and CTS. The growth in revenues of 11.9% was reflective of increased organic revenues of 13.7%, partially offset by a 180 basis point decrease related to foreign currency exchange rate fluctuations.
Six months ended February 28, 2022 compared with six months ended February 28, 2021
Americas
Revenues from our Americas segment increased 9.8% to $540.6 million during the six months ended February 28, 2022, compared with $492.3$42.9 million from the same period a year ago. The increased revenues were driven by higher sales in all of our workflow solutions, primarily in CTS, followed by Research & Advisory followed byand Analytics & Trading and CTS.Trading. The growth in revenues growth of 9.8%20.0% was due toreflective of a 15.3% increase in organic revenue growth of 9.6%revenues and a 20 basis point7.1% increase from deferred revenue fair value adjustments from purchase accounting and acquisition-related revenue.revenues, partially offset by a 2.4% decrease driven by the effects of foreign currency exchange rate fluctuations.
EMEASix months ended February 28, 2023 compared with six months ended February 28, 2022
Americas
Revenues from our EMEA segmentthe Americas increased 8.7%21.1% to $229.6$654.5 million during the six months ended February 28, 2022,2023, compared with $211.3$540.6 million from the same period a year ago. The increased revenues were driven by higher sales in all of our workflow solutions, primarily in Research & Advisory, followed by Analytics & Trading and CTS. The growth in revenues growth of 8.7%21.1% was driven byreflective of an 8.0% increase in organic revenue growth of 9.1% and a 10 basis point13.1% increase from deferred revenue fair value adjustments from purchase accounting, partially offset by a 50 basis point decrease from foreign currency exchange rate fluctuations.primarily due to the impact of acquisition-related revenue.
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Asia PacificEMEA
Revenues from our Asia Pacific segmentEMEA increased 12.1%14.7% to $85.7$263.2 million during the six months ended February 28, 2022,2023, compared with $76.4$229.6 million from the same period a year ago. The increased revenues were driven by higher sales acrossin all of our workflow solutions, of Analytics & Trading, Research & Advisory andprimarily in CTS. The growth in revenues growth of 12.1%14.7% was reflective of a 7.7% increase in organic revenue and an 8.2% increase primarily due mainly to organic revenues growththe impact of 13.7%,acquisition-related revenue, partially offset by a 160 basis point1.2% decrease fromdue to the effects of foreign currency exchange rate fluctuations.

Asia Pacific
Revenues from Asia Pacific increased 19.2% to $102.2 million during the six months ended February 28, 2023, compared with $85.7 million from the same period a year ago. The increased revenues were driven by higher sales in all of our workflow solutions, primarily in CTS. The growth in revenues of 19.2% was reflective of a 15.1% increase in organic revenues and a 7.1% increase from acquisition-related revenue, partially offset by a 3.0% decrease due to the effects of foreign currency exchange rate fluctuations.
Revenues by Workflow Solution
Three months ended February 28, 20222023 compared with three months ended February 28, 20212022
The growth in revenues of 10.0% across our segments was driven by increased revenues from all of our workflow solutions, primarily from sales of Research & Advisory, followed by Analytics & Trading and CTS,19.5% for the three months ended February 28, 2022,2023, compared with the same period a year ago.ago, was due to higher revenues from each of our segments supported by increased revenues from our workflow solutions, primarily from CTS and, to a lesser extent, Research & Advisory and Analytics & Trading. The increase in CTS revenues was mainly driven by CGS related data licensing and issuance revenues. The increase in Research & Advisory revenues was driven mainly by higher demand for our workstations. The increase in revenues from Analytics & Trading was primarily due to increased demand for our performance and portfolio reporting products, portfolio analytics solutions and portfolio analytics solutions.and benchmark services.
Six months ended February 28, 2023 compared with six months ended February 28, 2022
The growth in revenues of 19.2% for the six months ended February 28, 2023, compared with the same period a year ago, was due to higher revenues from each of our segments supported by increased revenues from our workflow solutions, primarily from CTS and, to a lesser extent, Research & Advisory and Analytics & Trading. The increase in CTS revenues was driven mainly by increased sales of company financialCGS related data such as fundamentalslicensing and estimates, along with data management solutions.
Six months ended February 28, 2022 compared with six months ended February 28, 2021
The revenues growth of 9.7% across our segments for the six months ended February 28, 2022 compared with the same period a year ago was primarily driven by increased sales of Research & Advisory, followed by Analytics & Trading and CTS.issuance revenues. The increase in Research & Advisory revenues was driven mainly by higher demand for our workstations. The increase in revenues from Analytics & Trading revenues was mainlyprimarily due to increased sales
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demand for our performance and portfolio reporting products, portfolio analytics solutions and portfolio analytics solutions. The increase in CTS revenues was driven mainly by increased sales of core and premium content sets, specifically related to company financial data and data management solutions.benchmark services.
Operating Expenses
 Three Months EndedSix Months Ended
February 28,February 28,% Change
(in thousands)20222021% Change20222021
Cost of services$199,395 $195,523 2.0 %$406,544 $383,611 6.0 %
Selling, general and administrative108,376 80,132 35.2 %203,291 159,219 27.7 %
Total operating expenses$307,771 $275,655 11.7 %$609,835 $542,830 12.3 %
Operating income$123,348 $116,133 6.2 %$246,009 $237,163 3.7 %
Operating margin28.6 %29.6 %28.7 %30.4 %
Principal Operating Costs and Expenses
Cost of services is mainly comprised of employee compensation costs and also includes expenses related to data costs, computer-related expenses, amortization of identifiable intangible assets, royalty fees, client-related communication costs and computer depreciation.
Selling, general and administrative ("SG&A") consists primarily of employee compensation costs and also includes expenses related to occupancy costs, professional fees, depreciation of furniture and fixtures, amortization of leasehold improvements, travel and entertainment expenses, marketing costs, non-compensatory employee expenses, internal communication costs and bad debt expense.
Employee compensation costs are a major component of both our cost of services and SG&A. These expenses primarily include costs related to salaries, incentive compensation and sales commissions, stock-based compensation, benefits, employment taxes, and any applicable restructuring costs.
We assign employee compensation costs between costs of services and SG&A based on the roles and activities associated with each employee. We categorize employees within the content collection, consulting, product development, software and systems engineering groups as cost of services personnel. Employees included in our sales department and those that serve in various other support departments, including marketing, finance, legal, human resources and administrative services, are classified as SG&A.
Asset impairments consist primarily of expenses recognized when the carrying amount of an asset exceeds its fair value.
The following table summarizes the components of our total operating expenses and operating margin for the periods presented:

 Three Months EndedSix Months Ended
February 28,February 28,% Change
(dollar amounts in thousands)20232022% Change20232022
Cost of services$240,806 $199,413 20.8 %$467,848 $406,544 15.1 %
SG&A104,582 98,066 6.6 %210,178 189,304 11.0 %
Asset impairments447 10,292 (95.7)%729 13,987 (94.8)%
Total operating expenses$345,835 $307,771 12.4 %$678,755 $609,835 11.3 %
Operating income$169,250 $123,348 37.2 %$341,145 $246,009 38.7 %
Operating margin32.9 %28.6 %33.4 %28.7 %
Cost of Services
Three months ended February 28, 20222023 compared with three months ended February 28, 20212022
Cost of services increased 2.0%20.8% to $199.4$240.8 million for the three months ended February 28, 2022,2023, compared with $195.5$199.4 million for the same period a year ago, primarily due to an increase in amortization of intangible assets, employee compensation costs, royalty fees related to our CGS acquisition and computer-related expenses.
Cost of services, when expressed as a percentage of revenues, was 46.8% for the three months ended February 28, 2023, an increase of 50 basis points over the prior year period. This increase was primarily due to higher amortization of intangible assets, royalty fees and computer-related expenses, partially offset by lower employee compensation and data costs.
Amortization of intangible assets increased 210 basis points mainly due to increased amortization related to acquired intangible assets, primarily from the CGS acquisition.
Royalty fees increased cost of services by 170 basis points due to contracts acquired in connection with the acquisition of CGS.
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Computer-related expenses increased 80 basis points due to increased spend from our migration to cloud-based hosting services, CGS integration activities, amortization of capitalized internal use software and an increase in licensed software arrangements.
Employee compensation costs decreased 340 basis points primarily due to growth of our revenues outpacing the increase in employee compensation costs. This decrease was also driven by higher capitalization of compensation costs related to the development of our internal-use software, partially offset by higher annual base salaries and variable compensation expense. The increase in annual base salaries was mainly due to annual merit increases and a net headcount increase in cost of services of 884, with hiring focused mainly in lower cost locations.
Data costs decreased by 70 basis points due to revenue growth outpacing the increased cost of content.
Six months ended February 28, 2023 compared with six months ended February 28, 2022
For the six months ended February 28, 2023, cost of services increased 15.1% to $467.8 million compared with $406.5 million in the same period a year ago, primarily due to an increase in employee compensation expense, computer-related expenses and amortization of intangible assets, partially offset by computer depreciation.royalty fees related to our CGS acquisition, computer-related expenses and employee compensation costs.

Cost of services, when expressed as a percentage of revenues, was 46.3%45.9% for the threesix months ended February 28, 2022,2023, a decrease of 370160 basis points compared with the same period a year ago. This decrease was primarily due to lower employee compensation expense and lower computer depreciation expenses as a percentage of revenue. Employee compensation expense decreased 260 basis points due primarily to growth in revenues outpacing the growth of employee compensation expense and a shift in headcount distribution from higher to lower cost locations,data costs, partially offset by higher base salaries, a net increase in employee headcount of 51 and higher stock-based compensation expense. Computer depreciation expenses decreased 30 basis points, primarily driven by fully depreciated network-related equipment that is not being replaced due to our migration to cloud-based hosting services.
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Six months ended February 28, 2022 compared with six months ended February 28, 2021
For the six months ended February 28, 2022, cost of services increased 6.0% to $406.5 million compared with $383.6 million in the same period a year ago, primarily due to an increase in computer-related expenses, employee compensation expense, including stock-based compensation, amortization of intangible assets, royalty fees and data costs.computer-related expenses.

Cost of services, when expressed as a percentage of revenues, was 47.5% for the six months ended February 28, 2022, a decrease of 170 basis points compared with the same period a year ago. This decrease was primarily driven by lower employee compensation expense, partially offset by higher computer-related expenses and amortization of intangible assets as a percentage of revenue. Employee compensation expensecosts decreased 200450 basis points primarily due to growth inof our revenues outpacing the growth of employee compensation expense and a shift in headcount distribution from higher to lower cost locations. This decreaseincrease in employee compensation costs. This decrease was partially offsetalso driven by higher capitalization of compensation costs related to the development of our internal-use software and a one-time restructuring charge to drive organizational realignment incurred during the first quarter of fiscal 2022, partially offset by higher stock-based compensation expense and annual base salaries and variable compensation expense. The increase in annual base salaries was primarily driven by annual merit increases and a net headcount increase in employee headcountcost of 51. services of 884, with hiring focused mainly in lower cost locations.
Data costs decreased 110 basis points mainly due to the release of certain accruals during the six months ended February 28, 2023 which related to the successful resolution of exchange audits that were set-up during the prior year period, partially offset by increased data prices and usage-based fees.
Amortization of intangible assets increased 200 basis points, mainly due to increased amortization related to acquired intangible assets, primarily from the CGS acquisition.
Royalty fees increased cost of services 170 basis points due to contracts acquired in connection with the acquisition of CGS.
Computer-related expenses increased 7040 basis points primarily due to increased spend from our migration to cloud-based hosting services and an increase in licensed software arrangements. Amortization of intangible assets increased 30 basis points mainly due to continued investment in capitalized internal-use software, with more assets placed in service.
Selling, General and Administrative
Three months ended February 28, 20222023 compared with three months ended February 28, 20212022
Selling, general and administrative ("SG&A")&A expenses increased 35.2%6.6% to $108.4$104.6 million for the three months ended February 28, 2022,2023, compared with $80.1$98.1 million forfrom the same period a year ago, primarily due to impairment chargeswith the majority of the increase related to vacating certain leased office space and higher employee compensation expense and, to a lesser extent, an increase in travel and entertainment expenses, partially offset by a decrease in professional fees.

SG&A expenses, when expressed as a percentage of revenues, were 25.1%20.3% for the three months ended February 28, 2022, an increase2023, a decrease of 470240 basis points over the prior year period. This increasedecrease was primarily due to lower occupancy costs and professional fees, partially offset by higher travel and entertainment expenses.
Occupancy costs decreased by 110 basis points mainly driven by impairment charges recognized during fiscal 2022 related to vacating certain leased office space, higher professional fees and higher employee compensation expense as a percentage of revenue. The impairment charges resulted in a 240 basis point increase to SG&A expenses driven mainly by impairments to ourwhich reduced occupancy costs recorded over their respective remaining lease right-of-use ("ROU") assets and Property, equipment and leasehold improvements associated with vacating certain leased office space. terms.
Professional fees increased 90decreased by 110 basis points primarily driven by costs incurred in preparation forrelated to the acquisition of CGS. Employee compensation expenseCGS incurred during the prior year period.
Travel and entertainment expenses increased by 70 basis points primarily dueas we resumed essential business travel and incurred non-compensatory employee-related costs related to a net increase in employee headcountreturn to office activities during the current year.
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Six months ended February 28, 20222023 compared with six months ended February 28, 20212022
For the six months ended February 28, 2022,2023, SG&A expenses increased 27.7%11.0% to $203.3$210.2 million, compared with $159.2$189.3 million for the same period a year ago, primarily due to higher employee compensation costs and an increase in employee compensation expense, impairment charges related to vacating certain leased office spacetravel and higher professional fees.entertainment expenses.

SG&A expenses, when expressed as a percentage of revenues, was 23.8%were 20.6% for the six months ended February 28, 2022, an increase2023, a decrease of 330150 basis points over the prior year period. This decrease was primarily due to lower occupancy costs, professional fees, and employee compensation costs, partially offset by an increase in travel and entertainment expenses.

Occupancy costs decreased by 100 basis points mainly driven by impairment charges recognized during fiscal 2022 related to vacating leased office space, which reduced occupancy costs recorded over their respective remaining lease terms.
Professional fees decreased 80 basis points, primarily driven by costs related to the acquisition of CGS incurred during the prior year period.
Employee compensation costs decreased 30 basis points, primarily due to growth of our revenues outpacing the increase in employee compensation costs, partially offset by higher annual base salaries and stock-based compensation expense. The increase in annual base salaries was primarily driven by impairment chargesa net headcount increase in SG&A of 228 and annual merit increases.
Travel and entertainment expenses increased by 70 basis points as we resumed essential business travel and incurred non-compensatory employee-related costs related to vacating certain leased property, higher employee compensation expensereturn to office activities during the current year.
Asset Impairments
Asset impairments incurred during the three and increased professional fees assix months ended February 28, 2022 were $10.3 million and $14.0 million, respectively, with no similar level of impairment recorded during the three and six ended February 28, 2023. The asset impairments recognized during the three and six months ended February 28, 2022 included a percentage of revenue. The impairment charges resulted in a 90 basis point increase to SG&A expenses driven mainly by impairmentsrespective $9.7 million and $13.4 million charge related to our lease ROUright-of-use ("ROU") assets and Property,property, equipment and leasehold improvements associated with vacating certain leased office space. Employee compensation expense increased 70 basis points, primarily duespace to higher annual base salaries, a net increase in employee headcount of 73, and increased year-over-year variable compensation. Professional fees increased 50 basis points, primarily driven by costs incurred in preparationresize our real estate footprint for the acquisitionhybrid work environment. We fully impaired our lease ROU assets for locations we vacated with no intention to sublease. For locations we intend to sublease, we recognized an impairment when the estimated fair value of CGS.the lease ROU asset was less than its carrying value. Substantially all the property, equipment and leasehold improvements associated with the vacated lease office space was fully impaired as there are no expected future cash flows for these items.
Operating Income and Operating Margin
Three months ended February 28, 20222023 compared with three months ended February 28, 20212022
Operating income increased 6.2%37.2% to $123.3$169.3 million for the three months ended February 28, 2022,2023, compared with $116.1$123.3 million in the prior year. Operating income increasedyear period. This increase was primarily due to growth in revenues of 10.0%,and, to a lesser extent, asset impairment charges incurred during the prior year period. These increases to operating income were partially offset by impairment charges related to vacating certain leased office space, an increase inhigher employee compensation expensecosts, amortization of intangible assets, royalty fees and higher professional fees driven by costs incurred in preparation for the acquisition of CGS.computer-related expenses. Foreign currency exchange rate fluctuations, net of hedge activity, decreasedincreased operating income by $7.7 million for the three months ended February 28, 2023, compared with a decrease of $1.2 million.
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Operating margin decreased to 28.6%million during the three months ended February 28, 2022,2022.
Operating margin increased to 32.9% during the three months ended February 28, 2023, compared with 29.6%28.6% in the prior year period. Operating margin decreasedThis increase was mainly due to impairment charges related to vacating certain leased office space, professional fees driven by costs incurred in preparation for the acquisition of CGS, partially offset by growth in revenues and lower costs related toa decrease in employee compensation costs, as well as asset impairment charges recorded in the three months ended February 28, 2022, when expressed as a percentage of revenues. The margin improvement was further driven by a decrease in occupancy costs and computer depreciation.professional fees, partially offset by higher amortization of intangible assets and royalty fees, when expressed as a percentage of revenues.
Six months ended February 28, 20222023 compared with six months ended February 28, 20212022
Operating income increased 3.7%38.7% to $246.0$341.1 million for the six months ended February 28, 20222023, compared with $237.2$246.0 million in the prior year period. Operating income increased primarily due to growth in revenues of 9.7%,and, to a lesser extent, asset impairment charges recognized in the prior year period. These increases in operating income were partially offset by increases inhigher employee compensation expense, impairment charges related to vacating certain leased office space and increases in computer-related expenses, professional fees,costs, amortization of intangible assets, royalty fees and data costs.computer-related expenses. Foreign currency exchange rate fluctuations, net of hedge activity, decreasedincreased operating income by $16.3 million, compared with a decrease of $5.4 million.million during the six months ended February 28, 2022.
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Operating margin decreasedincreased to 28.7%33.4% for the six months ended February 28, 2022,2023, compared with 30.4%28.7% in the prior year period. Operating margin decreasedThis increase was primarily due to growth in revenues and a decrease in employee compensation costs, as well as asset impairment charges related to vacating certain leased property, computer-related expenses, professional feesrecognized in the prior year period, when expressed as a percentage of revenues. The margin improvement was further driven by a decrease in data costs and amortization of intangibles,occupancy costs, partially offset by lower employee compensation expense.higher amortization of intangible assets and royalty fees, when expressed as a percentage of revenues.
Operating Income by Segment
Our internal financial reporting structure is based on three reportable segments: the Americas; EMEA; and Asia Pacific. Refer to Note 16, Segment Information, in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for further discussion regarding our segments. The following table summarizes our operating income by segment for the periods described:
Three Months EndedSix Months Ended Three Months EndedSix Months Ended
February 28,% ChangeFebruary 28,% ChangeFebruary 28,% ChangeFebruary 28,% Change
(in thousands)2022202120222021
(dollar amounts in thousands)(dollar amounts in thousands)20232022% Change20232022% Change
AmericasAmericas$48,903 $53,614 (8.8)%$104,401 $109,989 (5.1)%Americas$61,181 $48,903 $128,712 $104,401 
EMEAEMEA45,944 40,290 14.0 %86,598 80,924 7.0 %EMEA68,941 45,944 136,263 86,598 
Asia PacificAsia Pacific28,501 22,229 28.2 %55,010 46,250 18.9 %Asia Pacific39,128 28,501 37.3 %76,170 55,010 38.5 %
Total Operating IncomeTotal Operating Income$123,348 $116,133 6.2 %$246,009 $237,163 3.7 %Total Operating Income$169,250 $123,348 37.2 %$341,145 $246,009 38.7 %
Three months ended February 28, 20222023 compared with three months ended February 28, 20212022
Americas
Americas operating income decreased 8.8%increased 25.1% to $48.9$61.2 million during the three months ended February 28, 2022,2023, compared with $53.6 million in the same period a year ago. This decrease in operating income was due to impairment charges related to vacating certain leased office space, higher employee compensation expense and professional fees, partially offset by growth in revenues of 10.4%. The impairment charges related mainly to our lease right-of-use ("ROU") assets and Property, equipment and leasehold improvements associated with vacating certain leased office space. Employee compensation expense increased mainly due to higher stock compensation expense and increased variable compensation, partially offset by a net decrease in employee headcount of 225. Professional fees increased primarily due to costs incurred in preparation for the acquisition of CGS.
EMEA
EMEA operating income increased 14.0% to $45.9 million during the three months ended February 28, 2022, compared with $40.3 million recognized during the same period a year ago. The increase in EMEA operating income was due to growth in revenues of 8.6%, partially offset by higher employee compensation expense and an increase in our accounts receivable reserves. Employee compensation expense increased mainly due to increased variable compensation.
Asia Pacific
Asia Pacific operating income increased 28.2% to $28.5 million during the three months ended February 28, 2022, compared with $22.2$48.9 million in the same period a year ago. This increase in operating income was mainlyprimarily due to growth in revenues of
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11.9%, 21.0% and asset impairment charges recorded in the prior year period, partially offset by higher employee compensation expense. Employee compensation expense increased mainly due to higher annual base salaries, a net increase in employee headcount of 351 and increased variable compensation.
Six months ended February 28, 2022 compared with six months ended February 28, 2021
Americas
Americas operating income decreased 5.1% to $104.4 million during the six months ended February 28, 2022, compared with $110.0 million in the same period a year ago. This decrease in operating income was due to higher employee compensation expense, impairment charges related to vacating certain leased office space, higher computer-related expenses, professional fees and amortization of intangible assets, partially offset by growth in revenues of 9.8%. Employeeemployee compensation expense increased primarily due to the impact of a one-time restructuring charge to drive organizational realignment, higher stock compensation expensecosts, royalty fees and increased variable compensation expense, partially offset by a net decrease in employee headcount of 225. computer-related expenses.
The impairment charges recorded in the prior year period were mainly related mainly to our lease right-of-use ("ROU")ROU assets and Property,property, equipment and leasehold improvements ("PPE") associated with vacating certain leased office space.
Amortization of intangible assets primarily increased due to amortization related to acquired intangible assets, mainly from the CGS acquisition.
Employee compensation costs increased primarily due to an increase in annual base salary and, to a lesser extent, an increase in variable compensation costs, partially offset by higher capitalization of compensation costs related to the development of our internal-use software. The increase in annual base salary was primarily driven by annual merit increases and a net headcount increase of 275.
Royalty fees increased due to contracts acquired in connection with the acquisition of CGS.
Computer-related expenses increased primarily due to increased spend from our migration to cloud-based hosting services to support our transition to a hybrid cloud strategy, CGS integration activities and expenses related to licensed software arrangements. Professional fees increased primarily due to costs incurred in preparation for the acquisition of CGS. Amortization of intangible assets increased primarily due to a continued investment in capitalized internal-use software, with more assets placed in service.
EMEA
EMEA operating income increased 7.0%50.1% to $86.6$68.9 million during the sixthree months ended February 28, 2022,2023, compared with $80.9$45.9 million inrecognized during the same period a year ago. TheThis increase in EMEA operating income was primarily due to growth in revenues of 8.7%15.6%, lower amortization of intangible assets and a reduction in bad debt expense, partially offset by an increase in employee compensation expense and data costs. Amortization of intangible assets decreased as certain acquired intangible assets were fully amortized during the third quarter of fiscal 2022. Employee compensation expense increased mainly due to the impact of a one-time restructuring charge to drive organizational realignment and higher annual base salaries. Data costs increased primarily due to an increase in annual base salary driven by annual merit increases and a non-recurring charge for certain data content.net headcount increase of 93.
Asia Pacific
Asia Pacific operating income increased 18.9%37.3% to $55.0$39.1 million during the sixthree months ended February 28, 2022,2023, compared with $46.3$28.5 million infrom the same period a year ago. Theprior year. This increase in Asia Pacific operating income was mainly due to growth in revenues of 12.1%20.0%, partially offset by an increase inhigher employee compensation expense.costs and travel expenses. Employee compensation expense increased mainly due to higher annual base salaries driven by annual merit increases and a net increase in employee headcount of 351744. Travel expenses increased as we incurred non-compensatory employee-related costs related to return to office activities during the current year.
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Six months ended February 28, 2023 compared with six months ended February 28, 2022
Americas
Americas operating income increased 23.3% to $128.7 million during the six months ended February 28, 2023, compared with $104.4 million in the same period a year ago. This increase was primarily due to growth in revenues of 21.1% and asset impairment charges recorded in the prior year period, partially offset by an increase in amortization of intangible assets, employee compensation costs, royalty fees and computer-related expenses.

The impairment charges recorded in the prior year period were mainly related to our lease ROU assets and PPE associated with vacating certain leased office space.
Amortization of intangible assets primarily increased due to amortization related to acquired intangible assets, mainly from the CGS acquisition.
Employee compensation costs increased primarily due to an increase in annual base salary, and, to a lesser extent, an increase in variable compensation.compensation expense, partially offset by an increase in capitalized compensation costs related to development of internal-use software projects and a current period benefit due to a one-time restructuring charge recorded in the prior year period to drive organizational realignment. The increase in annual base salary was driven by annual merit increases and a net increase in employee headcount of 275.
Income Taxes, Net IncomeRoyalty fees increased due to contracts acquired in connection with the acquisition of CGS.
Computer-related expenses increased primarily due to increased spend from our migration to cloud-based hosting services to support our transition to a hybrid cloud strategy, as well as expenses related to licensed software arrangements.
EMEA
EMEA operating income increased 57.4% to $136.3 million during the six months ended February 28, 2023, compared with $86.6 million in the same period a year ago. This increase was primarily due to growth in revenues of 14.7%, a decrease in data costs and Diluted Earnings per Shareamortization of intangible assets, partially offset by an increase in employee compensation costs.
 Three Months EndedSix Months Ended
February 28,% ChangeFebruary 28,% Change
(in thousands, except for per share data)2022202120222021
Provision for income taxes$12,018 $18,023 (33.3)%$24,301 $37,049 (34.4)%
Net income$109,938 $96,643 13.8 %$217,585 $197,849 10.0 %
Diluted earnings per common share$2.84 $2.50 13.6 %$5.63 $5.12 10.0 %

Data costs decreased due to the release of certain accruals during the six months ended February 28, 2023 which related to the successful resolution of exchange audits that were set-up during the prior year period.
Amortization of intangible assets decreased as certain acquired intangible assets were fully amortized during the third quarter of fiscal 2022.
Employee compensation costs increased primarily due to an increase in variable compensation, partially offset by a one-time restructuring charge recorded during the prior year period to drive organization realignment.
Asia Pacific
Asia Pacific operating income increased 38.5% to $76.2 million during the six months ended February 28, 2023, compared with $55.0 million in the same period a year ago. This increase was mainly due to growth in revenues of 19.2%, partially offset by an increase in employee compensation costs and travel expenses. Employee compensation expense increased primarily due to higher annual base salary driven by annual merit increases and a net headcount increase of 744. Travel expenses increased as we incurred non-compensatory employee-related costs related to return to office activities during the current year.
Income Taxes
OurThe provision for income taxes and the effective tax rate is as follows:
Three Months EndedSix Months Ended
February 28,February 28,
(dollar amounts in thousands)20232022% Change20232022% Change
Income before income taxes$156,762 $121,956 28.5 %$314,647 $241,886 30.1 %
Provision for income taxes$25,169 $12,018 109.4 %$46,256 $24,301 90.3 %
Effective tax rate16.1 %9.9 %62.9 %14.7 %10.0 %46.3 %
We are subject to taxation in the United States and various foreign jurisdictions in which we conduct our business.
Our provision for income taxes for interim periods is calculated by applying an estimate of our annual effective tax rate to our quarter and year-to-date results, adjusted for discrete items recorded in the period. The computation of the annual estimated
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effective tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected pretax income (or loss) for the year, projections of the proportion of income (or loss) earned and taxed in foreign jurisdictions, permanent and temporary differences and the likelihood of recovering deferred tax assets, then adjusted for any discrete items. On a quarterly basis, we update the estimate of our annual effective tax rate as new events occur, assumptions change, or additional information is obtained.
For the three months ended February 28, 2023, the effective tax rate was 16.1% compared to 9.9% for the same period a year ago. For the six months ended February 28, 2023, the effective tax rate was 14.7% compared to 10.0% for the same period a year ago. For all periods presented, our effective tax rate was lower than the applicable U.S. corporate income tax rate formainly due to research and development ("R&D") tax credits, a foreign derived intangible income ("FDII") deduction and a tax benefit from the exercise of stock options.
Our effective tax rate during the three and six months ended February 28, 2022, driven2023 was higher than the rate during the respective prior year periods, due mainly by research and development ("R&D")to a decrease in the impact of tax credits and a foreign derived intangible income ("FDII") deduction. Ourattributes on the effective tax rate foras a result of an increase in income, a lower tax benefit from the three and six months ended February 28, 2022 is further reduced by windfall tax benefits associated with the employee exercise of stock options.options and an increase in the U.K.'s enacted tax rates.
Net Income and Diluted Earnings per Share
 Three Months EndedSix Months Ended
February 28,February 28,
(dollar amounts in thousands, except per share data)20232022% Change20232022% Change
Net income$131,593 $109,938 19.7 %$268,391 $217,585 23.3 %
Diluted weighted average common shares38,981 38,761 0.6 %38,947 38,628 0.8 %
Diluted earnings per common share$3.38 $2.84 19.0 %$6.89 $5.63 22.4 %
Three monthsended February 28, 20222023 compared with three months ended February 28, 20212022
For the three months ended February 28, 2022, the provision forNet income taxes was $12.0increased 19.7% to $131.6 million compared with $18.0 million for the same period a year ago. The provision decreased mainly dueand EPS increased 19.0% to lower projected levels of income before income taxes, a lower effective tax rate compared to the prior year period and a $4.2 million in higher windfall tax benefits from stock-based compensation, partially offset by higher income before income taxes$3.38 for the three months ended February 28, 2022, compared with the prior year period.
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Six months ended February 28, 2022 compared with six months ended February 28, 2021
For the six months ended February 28, 2022, the provision for income taxes was $24.3 million, compared with $37.0 million for the same period a year ago. The provision decreased mainly due to lower projected levels of income before income taxes, a lower effective tax rate compared to the prior year period and $11.2 million in higher windfall tax benefit from stock-based compensation, partially offset by higher income before income taxes during the six months ended February 28, 2022, compared with the prior year period.
Net Income and Diluted Earnings per Share
Three monthsendedFebruary 28, 2022compared with three months endedFebruary 28, 2021
Net income increased 13.8% to $109.9 million and diluted earnings per share ("EPS") increased 13.6% to $2.84 for the three months ended February 28, 2022,2023, compared with the same period a year ago. Net income and diluted EPS increased primarily due to increasedhigher operating income, and a reductionpartially offset by an increase in the provision for income taxes.taxes and an increase in interest expense as a result of higher outstanding debt, compared with the prior year period.
Six months ended February 28, 20222023 compared with six months ended February 28, 20212022
Net income increased 10.0%23.3% to $217.6$268.4 million and diluted EPS increased 10.0%22.4% to $5.63$6.89 for the six months ended February 28, 2022,2023, compared with the same period a year ago. Net income and diluted EPS increased primarily due to higher operating income, partially offset by an increase in interest expense as a decreaseresult of higher outstanding debt and an increase in the provision for income taxes, and increased operating income.compared with the prior year period.
Non-GAAP Financial Measures
To supplement the financial measures prepared in accordance with generally accepted accounting principles in the United States ("GAAP"), we use non-GAAP financial measures including organic revenue,revenues, adjusted operating income, adjusted operating margin, adjusted net income, EBITDA, adjusted EBITDA and adjusted diluted EPS.earnings per share. The reconciliations of these non-GAAP financial measures to the most directly comparablefrom our financial measures calculated and presented in accordance with GAAP to these non-GAAP financial measures are showshown in the tables below. These non-GAAP financial measures should not be considered in isolation from, as a substitute for or superior to, financial measures reported in accordance with GAAP. Moreover, these non-GAAP financial measures have limitations in that they do not reflect all the items associated with the operations of theour business as determined in accordance with GAAP. Other companies may calculate similarly titled non-GAAP financial measures differently thatthan we do, limiting the usefulness of those measures for comparative purposes.
Despite the limitations of these non-GAAP financial measures, we believe these adjusted financial measures, and the information they provide, are useful in viewing our performance using the same tools that management uses to gauge progress in achieving our goals. Adjusted measures may also facilitate comparisons to our historical performance.
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Adjusted revenues exclude the impact of the fair value of deferred revenues acquired in a business combination. Organic revenues further excludes revenues related to acquisitions and dispositions completed in the last 12 months and foreign currency movements in all periods presented.
The table below provides an unaudited reconciliation of revenues to adjusted revenues and organic revenues.
Three Months Ended Three Months EndedSix Months Ended
February 28,% ChangeFebruary 28,% ChangeFebruary 28,% Change
(In thousands)20222021
(dollar amounts in thousands)(dollar amounts in thousands)20232022% Change20232022% Change
RevenuesRevenues$431,119 $391,788 10.0 %Revenues$515,085 $431,119 $1,019,900 $855,844 
Deferred revenues fair value adjustment(1)
Deferred revenues fair value adjustment(1)
(62)181 
Deferred revenues fair value adjustment(1)
— (62)— 24 
Adjusted revenuesAdjusted revenues431,057 391,969 10.0 %Adjusted revenues$515,085 $431,057 19.5 %$1,019,900 $855,868 19.2 %
Acquired revenues(2)
Acquired revenues(2)
(1,883)— 
Acquired revenues(2)
(47,370)— (95,825)— 
Currency impact(3)
Currency impact(3)
1,589 — 
Currency impact(3)
1,832 — 5,332 — 
Organic revenuesOrganic revenues$430,763 $391,969 9.9 %Organic revenues$469,547 $431,057 8.9 %$929,407 $855,868 8.6 %
(1)The Reflects the amortization effect of the purchase accounting adjustment onrelated to the fair value of acquired deferred revenues.revenues for acquisitions prior to fiscal 2022. Acquisitions thereafter do not include this adjustment in accordance with our adoption of ASU No. 2021-08, Business Combinations: Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (Topic 805).
(2)Revenues from acquisitions completed within the last 12 months.
(3)The impact from foreign currency movements year over the past 12 months.year.
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The table below provides an unaudited reconciliation of operating income, operating margin, net income and diluted EPS to adjusted operating income, adjusted operating margin, adjusted net income, EBITDA, adjusted EBITDA and adjusted diluted EPS.
 Three Months Ended
February 28,
(In thousands, except per share data)20222021% Change
Operating income$123,348 $116,133 6.2 %
Deferred revenues fair value adjustment(62)181 
Intangible asset amortization6,291 5,914 
Real estate charges9,734 — 
Business acquisition costs5,048 — 
Transformation costs (1)
580 4,654 
Restructuring / severance200 961 
     Adjusted operating income$145,139 $127,843 13.5 %
     Operating margin28.6 %29.6 %
     Adjusted operating margin(2)
33.7 %32.6 %
Net income$109,938 $96,643 13.8 %
Deferred revenues fair value adjustment(55)148 
Intangible asset amortization5,543 4,843 
Real estate charges8,578 — 
Business acquisition costs4,448 — 
Transformation costs(1)
512 3,813 
Restructuring / severance177 787 
Income tax items(2,466)(1,154)
     Adjusted net income(3)
$126,675 $105,080 20.6 %
Net income$109,938 $96,643 
Interest expense, net1,673 1,815 
Income taxes12,018 18,023 
Depreciation and amortization expense13,395 15,672 
    EBITDA$137,024 $132,153 3.7 %
Non-recurring non-cash expenses(4)
9,734 — 
    Adjusted EBITDA$146,758 $132,153 11.1 %
Diluted earnings per common share$2.84 $2.50 13.6 %
Deferred revenues fair value adjustment0.00 0.00 
Intangible asset amortization0.14 0.13 
Real estate charges0.22 — 
Business acquisition costs0.11 — 
Transformation costs(1)
0.01 0.10 
Restructuring / severance0.01 0.02 
Income tax items(0.06)(0.03)
     Adjusted diluted earnings per common share(3)
$3.27 $2.72 20.2 %
Weighted average common shares (Diluted)38,761 38,620 
(1)Costs primarily related to professional fees associated with the ongoing multi-year investment plan.
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(2)earnings per share. Adjusted operating margin is calculated as adjusted operating income divided by adjusted revenues as shown in the organic revenues table above.
(3)For purposes of calculatingand margin, adjusted net income, and adjusted diluted earnings per share exclude intangible asset amortization, the impact of the fair value of deferred revenues fair value adjustmentsacquired in a business combination and other items were taxed at the quarterly effective tax rates of 11.9%non-recurring items. EBITDA excludes interest expense, provision for fiscal 2022income taxes and 16.9% for fiscal 2021.depreciation and amortization expense, while Adjusted EBITDA further excludes non-recurring non-cash expenses.

(4)



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 Three Months EndedSix Months Ended
February 28,February 28,
(dollar amounts in thousands, except per share data)20232022% Change20232022% Change
Operating income$169,250 $123,348 37.2 %$341,145 $246,009 38.7 %
Deferred revenues fair value adjustment— (62)— 24 
Intangible asset amortization17,709 6,291 35,717 12,343 
Business acquisition / integration costs(1)
3,329 5,048 6,828 5,048 
Restructuring / severance433 200 433 9,228 
Real estate charges(2)
— 9,734 — 13,429 
Transformation costs (3)
— 580 — 1,768 
     Adjusted operating income$190,721 $145,139 31.4 %$384,123 $287,849 33.4 %
     Operating margin32.9 %28.6 %33.4 %28.7 %
     Adjusted operating margin(4)
37.0 %33.7 %37.7 %33.6 %
Net income$131,593 $109,938 19.7 %$268,391 $217,585 23.3 %
Deferred revenues fair value adjustment— (55)— 22 
Intangible asset amortization14,717 5,543 30,294 10,962 
Business acquisition / integration costs(1)
2,766 4,448 5,792 4,448 
Restructuring / severance360 177 360 8,261 
Real estate charges(2)
— 8,578 — 11,887 
Transformation costs(3)
— 512 — 1,576 
Income tax items(1,322)(2,466)(1,552)(2,725)
     Adjusted net income(5)
$148,114 $126,675 16.9 %$303,285 $252,016 20.3 %
Net income$131,593 $109,938 $268,391 $217,585 23.3 %
Interest expense16,737 1,962 33,274 3,934 
Income taxes25,169 12,018 46,256 24,301 
Depreciation and amortization expense26,211 13,395 52,208 32,827 
EBITDA$199,710 $137,313 45.4 %$400,129 $278,647 43.6 %
Real estate charges(2)
— 9,734 — 13,429 
Adjusted EBITDA$199,710 $147,047 35.8 %$400,129 $292,076 37.0 %
Diluted earnings per common share$3.38 $2.84 19.0 %$6.89 $5.63 22.4 %
Deferred revenues fair value adjustment— 0.00 — 0.00 
Intangible asset amortization0.37 0.14 0.78 0.28 
Business acquisition / integration costs(1)
0.07 0.11 0.15 0.12 
Restructuring / severance0.01 0.01 0.01 0.21 
Real estate charges(2)
— 0.22 — 0.31 
Transformation costs(3)
— 0.01 — 0.04 
Income tax items(0.03)(0.06)(0.04)(0.07)
     Adjusted diluted earnings per common share(5)
$3.80 $3.27 16.2 %$7.79 $6.52 19.5 %
Weighted average common shares (Diluted)38,981 38,761 38,947 38,628 
(1)Costs relatedRelated to integration costs of the CGS acquisition.
(2)Related to impairment charges of our lease ROU assets and Property,property, equipment and leasehold improvements associated with vacating certain leased office space.
(3)Primarily related to professional fees associated with our ongoing multi-year investment plan.
(4)Adjusted operating margin is calculated as Adjusted operating income divided by Adjusted revenues as shown in the revenues reconciliation table above.
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(5)For purposes of calculating Adjusted net income and Adjusted diluted earnings per share, all adjustments were taxed at the quarterly effective tax rates of 16.9% for fiscal 2023 and 11.9% for fiscal 2022.
Liquidity and Capital Resources
Our primary sources of liquidity have been our cash flows generated from our operations,provided by operating activities, existing cash and cash equivalents, and, when needed,supplemented with our credit capacity underlong-term debt borrowings, have been sufficient to fund our existing credit facility. We use these sourcesoperations while allowing us to invest in activities that support the long-term growth of liquidityour operations. Generally, some or all of the remaining available cash flow has been used to, among other things, service our existing and future debt obligations, satisfy our working capital requirements and fund our capital expenditures, investments, acquisitions, dividend payments and repurchases of our common stock. Based on past performance and current expectations, we believe our sources of liquidity, along withincluding the available capacity under our existing revolving credit facility and other financing alternatives, will provide us the necessary capital to fund these transactions and achieve our planned growth for the next 12 months and the foreseeable future. We are exposed to credit risk for cash and cash equivalents held in financial institutions in the event of a default, to the extent that such amounts are in excess of applicable insurance limits; however, we do not believe our concentration of cash and cash equivalents presents a significant credit risk as the counterparties to the instruments consist of multiple high-quality, credit-worthy financial institutions.
Sources of Liquidity
Long-Term Debt & Swap Agreements
2022 Credit Agreement
On March 1, 2022, we entered into a credit agreement (the "2022 Credit Agreement") and borrowed an aggregate principal amount of $1.0 billion under its senior unsecured term loan credit facility (the "2022 Term Facility") and $250.0 million of the available $500.0 million under its senior unsecured revolving credit facility (the "2022 Revolving Facility" and, together with the 2022 Term Facility, the "2022 Credit Facilities"). The 2022 Term Facility matures on March 1, 2025, and the 2022 Revolving Facility matures on March 1, 2027. The 2022 Revolving Facility allows for the availability of up to $100.0 million in the form of letters of credit and up to $50.0 million in the form of swingline loans. We may seek additional commitments under the 2022 Revolving Facility from lenders or other financial institutions up to an aggregate principal amount of $750.0 million.
We pay a commitment fee on the daily unused amount of the 2022 Revolving Facility using a pricing grid based on our senior unsecured non-credit enhanced long-term debt rating and our total leverage ratio. The commitment fee remained consistent at 0.125% from the borrowing date through February 28, 2023. During fiscal 2022, we incurred approximately $9.5 million in debt issuance costs related to the 2022 Credit Facilities.
We used these borrowings, along with the net proceeds from the issuance of the Senior Notes (as defined below) and cash on hand, to finance the consideration for the CGS acquisition, to repay borrowings under the 2019 Credit Agreement (as defined below) and to pay related transaction fees, costs and expenses.
We may voluntarily prepay loans under the 2022 Credit Facilities at any time without premium or penalty. During the three and six months ended February 28, 2023, we repaid $125.0 million and $250.0 million, respectively, under the 2022 Term Facility, inclusive of voluntary prepayments of $112.5 million and $225.0 million, respectively. Since loan inception on March 1, 2022, we have repaid $500.0 million under the 2022 Term Facility, inclusive of voluntary prepayments of $462.5 million.
As of February 28, 2023, the outstanding borrowings under the 2022 Credit Facilities bore interest at a rate equal to the applicable one-month Term Secured Overnight Financing Rate ("SOFR") rate plus a 1.1% spread (comprised of a 1.0% interest rate margin based on a debt leverage pricing grid plus a 0.1% credit spread adjustment). The spread remained consistent from the borrowing date through February 28, 2023. Interest on the 2022 Credit Facilities is currently payable on the last business day of each month, in arrears.
The 2022 Credit Agreement contains usual and customary event of default provisions for facilities of this type, which are subject to usual and customary grace periods and materiality thresholds. If an event of default occurs under the 2022 Credit Agreement, the lenders may, among other things, terminate their commitments and declare all outstanding borrowings immediately due and payable.
The 2022 Credit Agreement contains usual and customary affirmative and negative covenants for facilities of this type, including a financial covenant requiring maintenance of a total leverage ratio of no greater than 4.00 to 1.00 as of February 28, 2023. We were in compliance with all covenants and requirements of the 2022 Credit Agreement as of February 28, 2023.
Refer to Note 11, Debt in the Notes of this Quarterly Report on Form 10-Q for further discussion of the 2022 Credit Agreement.
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2022 Swap Agreement
On March 1, 2022, we entered into an interest rate swap agreement (the "2022 Swap Agreement") to hedge a portion of our outstanding floating SOFR rate debt with a fixed interest rate of 1.162%. Effective December 30, 2022, we apportioned the then-outstanding notional amount of the 2022 Swap Agreement between two counterparties. Refer to Note 5, Derivative Instruments, in the Notes of this Quarterly Report on Form 10-Q for more information on the 2022 Swap Agreement.
Senior Notes
On March 1, 2022 we completed a public offering of $500.0 million aggregate principal amount of 2.900% Senior Notes due March 1, 2027 (the “2027 Notes”) and $500.0 million aggregate principal amount of 3.450% Senior Notes due March 1, 2032 (the “2032 Notes” and, together with the 2027 Notes, the “Senior Notes”). The Senior Notes were issued pursuant to an indenture, dated as of March 1, 2022, by and between us and U.S. Bank Trust Company, National Association, as trustee (the "Trustee"), as supplemented by the supplemental indenture, dated as of March 1, 2022, between us and the Trustee (the "Supplemental Indenture").
Interest on the Senior Notes is payable semiannually in arrears on March 1 and September 1 of each year, with the first payment made on September 1, 2022. The Senior Notes were issued at an aggregate discount of $2.8 million during fiscal 2022 and we incurred approximately $9.1 million in debt issuance costs.
We may redeem the Senior Notes, in whole or in part, at any time at specified redemption prices, plus any accrued and unpaid interest. Upon the occurrence of a change of control triggering event (as defined in the Supplemental Indenture), we must offer to repurchase the Senior Notes at 101% of their principal amount, plus any accrued and unpaid interest.
2019 Credit Agreement
On March 29, 2019, we entered into a credit agreement with PNC Bank, National Association ("PNC") (the "2019 Credit Agreement"), which provides for a $750.0 million revolving credit facility (the "2019 Revolving Credit Facility"). The 2019 Revolving Credit Facility allows for borrowings until its maturity date of March 29, 2024. The 2019 Credit Agreement also allows for, subject to certain requirements, additional borrowings with PNC for an aggregate amount up to $500.0 million, provided that any such request for additional borrowings must be in a minimum amount of $25.0 million.
As of February 28, 2022, we haveand borrowed $575.0 million of the available $750.0 million provided by the 2019revolving credit facility thereunder (the "2019 Revolving Credit Facility, resulting in $175.0 million available to be withdrawn. We are required to pay a commitment fee using a pricing grid which was 0.10% as of February 28, 2022. This fee is based on the daily amount by which the available balance inFacility"). Borrowings under the 2019 Revolving Credit Facility exceeds the borrowed amount. All outstanding loan amounts are reported as Long-term debt within the Consolidated Balance Sheets at February 28, 2022 and August 31, 2021. The principal balance is payable in full on the maturity date.
Borrowings under the loan bearbore interest on the outstanding principal amount at a rate equal to the daily LIBOR plus a spread using a debt leverage pricing grid, which was 0.875% as of February 28, 2022. The variable rate of interest on the 2019 Revolving Credit Facility creates exposure to interest rate volatility due to changes in LIBOR. To mitigate this exposure, on March 5, 2020, we entered into an interest rate swap agreement with a notional amount of $287.5 million to hedge the variable interest rate obligation on a portion of our outstanding balance under the 2019 Revolving Credit Facility. Under the terms of the interest rate swap agreement, we pay interest at a fixed rate of 0.7995% and receive variable interest payments based on the same one-month LIBOR utilized to calculate the interest expense from the 2019 Revolving Credit Facility. The interest rate swap agreement matures on March 29, 2024.
Including the effects of the interest rate swap agreement, the weighted average interest rate on amounts outstanding under our 2019 Revolving Credit Facility was 1.36% and 1.38% for the six months ended February 28, 2022 and fiscal year ended August 31, 2021, respectively.grid. Interest on the amounts outstanding balance under the 2019 Revolving Credit Facility iswas payable quarterly, in arrears, and on the maturity date.
The 2019 Credit Agreement contains covenants and requirements restricting certain of our activities, which are usual and customary for this type of loan. In addition, the 2019 Credit Agreement requires that we maintain a consolidated net leverage ratio, as measured by total net funded debt/EBITDA (as defined in the 2019 Credit Agreement), below a specified level as of the end of each fiscal quarter. We were in compliance with all the covenants and requirements within the 2019 Credit Agreement as of February 28, 2022.
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As of March 1, 2022,, we repaid in full and terminated our 2019 Credit Agreement. Refer to Note 17, Subsequent Events for more information on the termination.
2022 Credit Agreement
On March 1, 2022, FactSet Research Systems Inc. entered into the 2022 Credit Agreement and concurrently we repaid in full and terminated the 2019 Credit Agreement. On March 1, 2022, we borrowed $1.0 billion under the 2022 Term Facility, and $250.0 million under the 2022 Revolving Facility. Refer to Note 17, Subsequent Events for definition11, Debt in the Notes of these terms and more informationthis Quarterly Report on the 2022 Credit Agreement.

Notes
On March 1, 2022, FactSet Research Systems Inc. completed a public offering of $500.0 million aggregate principal amount of 2.900% Senior Notes due 2027 and $500.0 million aggregate principal amount of 3.450% Senior Notes due 2032. Refer to Note 17, Subsequent EventsForm 10-Q for more information on the Senior Notes.termination.
Uses of Liquidity
Returning Value to Shareholders
ForDuring the six months ended February 28, 2023 we returned $67.5 million to shareholders in the form of dividends and during the six months ended February 28, 2022, we returned $80.1 million to stockholders in the form of share repurchases and dividends. Over the last 12 months, we returned $289.9$132.0 million to stockholders in the form of dividends, with no shares repurchased over this timeframe due to the suspension of our share repurchasesrepurchase program. Refer to the Share Repurchase Program below for more information.
Dividends
In the third quarter of fiscal 2022, our Board of Directors approved an 8.5% increase in the regular quarterly dividend from $0.82 to $0.89 per share. Fiscal 2022 marked 23 consecutive fiscal years of dividend increases, highlighting our continued commitment to returning value to stockholders. During the six months ended February 28, 2023 and dividends.February 28, 2022, we paid dividends of $67.5 million and $61.4 million, respectively. Future dividends will depend on our earnings, capital requirements, financial condition and other factors considered relevant by us and are subject to final determination by our Board of Directors.
Share Repurchase Program
UnderAs of February 28, 2023, $181.3 million remained authorized for future share repurchases under our share repurchase program, weprogram. There is no defined number of shares to be repurchased over a specified timeframe through the life of the program. We may repurchase shares of our common stock under the program from time to timetime-to-time in the open market and privately negotiated transactions, subject to market conditions.
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We did not repurchase any shares of our common stock during the three months ended February 28, 2023 and February 28, 2022. We also did not repurchase any shares during the six months ended February 28, 2023 compared with 46,200 shares repurchased for $18.6 million during the same period in the prior fiscal year. Beginning in the second quarter of fiscal 2022, we suspended our share repurchase program throughuntil at least the second half of fiscal 2023, with the exception of potential minor repurchases to offset dilution from grants of equity awards or repurchases to satisfy withholding tax obligations duedue upon the vesting of stock-based awards. The suspension of our share repurchase program allowsallowed us to prioritize the repayment of debt under the 2022 Credit Agreement.Facilities. We anticipate resuming the existing share repurchase program for the third and fourth quarters of fiscal 2023. Refer to Note 17,11, Subsequent EventsDebt in the Notes of this Quarterly Report on Form 10-Q for more information on the 2022 Credit Agreement.Facilities.
As such, for the three months ended February 28, 2022, we did not make any repurchases under our existing share repurchase program, compared to 221,959 shares repurchased for $71.5 million for the three months ended February 28, 2021. During the six months ended February 28, 2022, we repurchased 46,200 shares for $18.6 million under our existing share repurchase program compared with 353,759 shares for $114.6 million in the same period a year ago.

As of February 28, 2022, $181.3 million remained available under the share repurchase program for future share repurchases. There is no defined number of shares to be repurchased over a specified timeframe through the life of the share repurchase program. It is expected that share repurchases will be paid using existing and future cash generated by operations.
Capital Expenditures
For the six months ended February 28, 2022,2023, capital expenditures were $20.5increased by 72.4% to $35.4 million, compared with $28.8$20.5 million during the same period a year ago, a decrease of $8.2 million. Capital expenditures decreasedago. This increase was primarily due to costs incurred for the build-out of our office space in the Philippines during the six months ended February 28, 2021, without a similar expenditure during the six months ended February 28, 2022.
Dividends
On February 2, 2022, our Board of Directors approved a regular quarterly dividend of $0.82 per share. Dividends of $31.1 million were paid on March 17, 2022 to common stockholders of record at the close of business on February 28, 2022. Future cash dividends will depend on our earnings, capital requirements, financial condition and other factors considered relevant by us and are subject to final determination by our Board of Directors.
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Acquisitions
During fiscal 2022 and 2021, we completed acquisitions of several businesses, with the most significant cash flowshigher expenditures related to the acquisitionsdevelopment of Cobalt Software, Inc. ("Cobalt") and Truvalue Labs, Inc. ("TVL"). capitalized internal-use software.
Acquisitions
CUSIP Global Services
On March 1, 2022, we completed the acquisition of CGS.CGS for a cash purchase price of $1.932 billion, inclusive of working capital adjustments. CGS manages a database of 60 different data elements uniquely identifying more than 50 million global financial instruments. It is the foundation for security master files relied on by critical front, middle and back-office functions. CGS, operating on behalf of the ABA, is the provider of CUSIP and CINS identifiers globally and also acts as the official numbering agency for ISIN identifiers in the United States and as a substitute number agency for more than 35 other countries. We believe that the CGS acquisition will significantly expand our critical role in the global capital markets.
Cobalt Software, Inc.
On October 12, 2021, we acquired all of the outstanding shares of Cobalt Software, Inc. ("Cobalt") for a purchase price of $50.0 million, net of cash acquired,. and inclusive of working capital adjustments. Cobalt is a leading portfolio monitoring solutions provider for the private capital industry. This acquisition advances our strategy to scale our data and workflow solutions through targeted investments as part of our multi-year investment plan and expands our private markets offering.
On November 2, 2020, we acquired all of the outstanding shares of TVL for a purchase price of $41.9 million, net of cash acquired. TVL is a leading provider of ESG information. TVL applies artificial intelligence driven technology to over 100,000 unstructured text sources in multiple languages, including news, trade journals, and non-governmental organizations and industry reports, to provide daily signals that identify positive and negative ESG behavior. The acquisition of TVL further enhances our commitment to providing industry leading access to ESG data across our platforms.
Refer to Note 7,6, Acquisition,Acquisitions, in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Qfor further discussion of the CGS and Cobalt and TVL acquisitions. Refer to Note 17, Subsequent Events, in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Qfor more information on our March 1, 2022 acquisition of CGS.
Contractual Obligations
Purchase obligations represent committed payments due in future periodsour legally-binding agreements to our various data vendors and for other goods and services. These purchase commitments are agreements that are enforceable and legally binding on us, and they specify all significant terms, including: fixed or minimum quantities at determinable prices. Our total purchase obligations as of August 31, 2022 primarily related to be purchased; fixed, minimum or variable price provisions;hosting services and acquisition of data, and, to a lesser extent, third-party software providers. Hosting services support our technology investments related to our transition to a hybrid cloud strategy, the approximate timingmajority of which rely on third-party hosting providers. Data is an integral component of the transaction. The effect ofvalue we provide to our contractual obligations onclients and our liquidity and capital resources in future periods should be considered in conjunction with the factors mentioned here. commitments to third-party software providers mainly include internal-use software licenses.
As of August 31, 2021,2022, we had total purchase commitmentsobligations with suppliers of $191.9$373.9 million. During the second quarter of fiscal 2022,2023, we entered intoamended a software subscription agreementcontract with totala data supplier that resulted in an incremental commitment to purchase commitmentsdata of approximately $10 million with a contract term of three years.

$26 million.
We also have contractual obligations related to our lease liabilities and outstanding debt. Refer to Note 10, Leases and Note 11, Debt in the Notes of this Quarterly Report on Form 10-Q for information regarding lease commitments and outstanding debt obligations, respectively.
Summary of Cash Flows
The table below, for the periods indicated, provides selected cash flow information:
Six Months Ended
February 28,
(in thousands)20222021$ Change% Change
Net cash provided by operating activities$194,952 $229,936 $(34,984)(15.2)%
Net cash used in investing activities(70,814)(69,748)(1,066)1.5 %
Net cash used by financing activities(26,417)(146,659)120,242 (82.0)%
Effect of exchange rate changes on cash and cash equivalents(6,574)3,550 (10,124)(285.2)%
Net increase in cash and cash equivalents$91,147 $17,079 $74,068 433.7 %
As of February 28, 2023, Cash and cash equivalents aggregated towere $445.3 million, compared with $773.0 million as of February 28, 2022, compared with $681.9 million as of August 31, 2021. Our cash and cash equivalents increased $91.1 million during the six months ended February 28, 2022, primarily due to cash provided by operating activities of $195.0 million and proceeds from the exercise of employee stock options of $56.9 million, partially offset by cash outflows from dividend payments of $61.4 million, acquisition of a business of $50.0 million, capital expenditures of $20.5 million and share repurchases of $18.6 million.
2022. Our cash and cash equivalents are held in numerous locations throughout the world, with $493.9$196.4 million withinin the Americas, $215.4$155.3 million withinin EMEA (predominantly withinin the UK and France)U.K.) and the remaining $63.7$93.6 million withinin Asia Pacific (predominantly withinin India and the Philippines and India)Philippines) as of February 28, 2022.2023. We intend topermanently reinvest substantially all of our accumulated undistributed foreign unremitted earnings, except in instancesjurisdictions where repatriation would result in minimal additionalearnings can be repatriated substantially free of tax.
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The table below, for the periods indicated, provides selected cash flow information:
Six Months Ended
February 28,
(dollar amounts in thousands)20232022% Change
Net cash provided by operating activities$271,314 $194,952 39.2 %
Net cash provided by (used in) investing activities(46,305)(70,814)(34.6)%
Net cash provided by (used in) financing activities(285,654)(26,417)981.3 %
Effect of exchange rate changes on cash and cash equivalents2,698 (6,574)(141.0)%
Net increase (decrease) in cash and cash equivalents$(57,947)$91,147 (163.6)%
Operating
For the six months ended February 28, 2023, net cash provided by operating activities was $271.3 million, which included net income of $268.4 million, non-cash charges of $93.6 million and a net cash outflow of $90.6 million to support our working capital requirements. The non-cash charges were primarily driven by $52.2 million of depreciation and amortization, $27.5 million of stock-based compensation expense and $19.6 million from amortization of lease ROU assets. The change in our working capital was primarily driven by higher accounts receivable due to increased sales, an increase in days sales outstanding and a cash outflow of $51.7 million related to our variable compensation payment.
For the six months ended February 28, 2022, net cash provided by operating activities was $195.0 million, compared with $229.9which consisted of net income of $217.6 million, during the same periodnon-cash charges of $91.7 million and a year ago, a decreasenet cash outflow of $35.0 million. This decrease$114.3 million to support our working capital requirements. The non-cash charges were primarily driven by $32.8 million of depreciation and amortization, $25.9 million of stock-based compensation expense and $22.2 million from amortization of lease ROU assets. The change in our working capital was primarily driven by the timing
of both tax payments in certain jurisdictions and collections ofhigher accounts receivable as well as higher bonus payments, partially offset by higher net income.due to an increase in sales and a cash outflow of $34.7 million related to our variable compensation payment.
Investing
NetFor the six months ended February 28, 2023, net cash used in investing activities was $46.3 million. The cash used in investing activities was primarily due to an increase in capital expenditures of $35.4 million mainly due to capitalization of compensation costs related to development of our internal-use software projects.
For the six months ended February 28, 2022, net cash used in investing activities was $70.8 million. The cash used in investing activities was primarily due to the purchase of Cobalt for $50.0 million.
Financing
For the six months ended February 28, 2023, net cash used in financing activities was $285.7 million, forconsisting mainly of $250.0 million related to the partial repayment of the 2022 Term Facility and $67.5 million of dividend payments, partially offset by $43.6 million of proceeds from employee stock plans.
For the six months ended February 28, 2022, representing a $1.1 million increase from the same period a year ago. This increase was driven by higher spend on acquisitions, with a $50.0 million cash purchase price for Cobalt, net of cash acquired, during the six months ended February 28, 2022, compared with a $41.9 million cash purchase price for TVL, net of cash acquired, in the prior year period. The increase in net cash used in investing was further impacted by a reduction of $1.2 million in net proceeds from investments (net of purchases) during the six months ended February 28, 2022 compared to the prior year period, partially offset by a decrease in capital expenditures of $8.2 million for the six months ended February 28, 2022 compared with the prior year period.
Financing
Net cash used in financing activities was $26.4 million, for the six months ended February 28, 2022, representing a $120.2consisting mainly of $61.4 million favorable change compared with the same period a year ago. This cash flow improvement was mainly drivenof dividend payments and $18.6 million of repurchases of common stock, partially offset by a $96.0$56.9 million decrease in share repurchases and a $28.4 million increase inof proceeds from employee stock plans, partially offset by an increase of $3.3 million in dividend payments.plans.
Free Cash Flow
We define free cash flow, a non-GAAP financial measure, as cash provided by operating activities less purchases of property, equipment, leasehold improvements and capitalized internal-use software. We presentbelieve free cash flow solely as a supplemental disclosure to provide useful information to investors about the amount of cash generated by the business after necessary capital expenditures. We consider free cash flow to beis a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that, after necessary capital expenditures.expenditures, can be used for strategic opportunities, including returning value to shareholders, investing in our business, making strategic acquisitions and strengthening the balance sheet. Free cash flow should be considered in addition to, rather than as a substitute for, consolidated net income as a measure of our performance and net cash provided by operating activities as a measure of our liquidity.
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The following table reconciles our net cash provided by operating activities to free cash flow:
Six Months EndedSix Months Ended
February 28,February 28,
(in thousands)20222021Change
(dollar amounts in thousands)(dollar amounts in thousands)20232022Change
Net cash provided by operating activitiesNet cash provided by operating activities$194,952 $229,936 $(34,984)Net cash provided by operating activities$271,314 $194,952 $76,362 
Capital expenditures(1)
(20,546)(28,758)8,212 
Less: purchases of property, equipment, leasehold improvements and capitalized internal-use softwareLess: purchases of property, equipment, leasehold improvements and capitalized internal-use software(35,416)(20,546)(14,870)
Free cash flowFree cash flow$174,406 $201,178 $(26,772)Free cash flow$235,898 $174,406 $61,492 
(1) Capital expenditures are includedWe generated free cash flow of $235.9 million during the six months ended February 28, 2023, an increase of $61.5 million compared with the same period a year ago. This change reflects a $76.4 million increase in cash provided by operating activities, mainly due to higher net cash usedincome and lower working capital requirements, partially offset by a $14.9 million increase in investing activities during each fiscal period reported and includepurchases of property, equipment, leasehold improvements and capitalized internal-use software.
Free cash flow generated during the six months ended February 28, 2022 was $174.4 million compared with $201.2 million during the same period a year ago, reflecting a 13.3% decrease. This $26.8 million decrease was duesoftware, primarily driven by higher capitalized costs related to a $35.0 million decrease in operating cash flows, partially offset by an $8.2 million decrease in capital expenditures.internal-use software.
Off-Balance Sheet Arrangements
AtAs of February 28, 20222023 and August 31, 2021,2022, we had no off-balance sheet financing or other arrangements with unconsolidated entities or financial partnerships (such as entities often referred to as structured finance or special purpose entities) established for purposes of facilitating off-balance sheet financing, other debt arrangements, or other contractually limited purposes.
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Foreign Currency
Foreign Currency Exposure
WeAs we operate globally, we are exposed to foreign currency fluctuations fromthe risk that our international wholly-owned subsidiaries, primarily drivenfinancial condition, results of operations and cash flows could be impacted by employee compensation, with 79% of our employee headcount locatedchanges in foreign locations. The functional currency of these foreign subsidiaries are primarily their respective local currencies. The revenues and expenses of these subsidiaries have been translated into U.S. dollars at average exchange rates prevailing during the period and the assets and liabilities translated at the rates of exchange on the balance sheet date. The net translation gains and losses are recorded in accumulated other comprehensive loss as a component of stockholders’ equity.
During the three months ended February 28, 2022, foreign currency exchange rate fluctuations, net of hedge activity, decreased operating income by $1.2 million, compared with a decrease of $1.4 million to operating income a year ago. During the six months ended February 28, 2022, foreign currency exchange rate fluctuations, net of hedge activity, decreased operating income by $5.4 million, compared with a $0.8 million a decrease to operating income a year ago.rates. To mitigate thethis foreign currency exposure, we entered into a series of forward contracts to hedge a portion of our foreign currency risk related to the British Pound Sterling, Euro, Indian Rupee, Euro and Philippine Peso exposuresPeso. As of February 28, 2023, these forward contracts hedge a portion of our foreign currency transaction exposure ranging from 25% to 50%75%, over their respective hedged periods, as of February 28, 2022. The current foreign currency forward contractswhich are set to mature at various points between the third quarter of fiscal 20222023 through the firstsecond quarter of fiscal 2023.2024.
As of February 28, 2022,The following table summarizes the gross notional value of foreign currency forward contracts to purchase the British Pound Sterling, Euro, Indian Rupee and Philippine Pesos and Indian RupeesPeso with U.S. dollars was ₱0.9 billiondollars:
February 28, 2023August 31, 2022
(in thousands)Local CurrencyUSDLocal CurrencyUSD
British Pound Sterling£46,000 $55,491 £44,200 $55,567 
Euro37,500 39,877 37,500 40,679 
Indian RupeeRs2,987,143 36,200 Rs2,667,928 33,600 
Philippine Peso1,767,455 31,600 1,462,060 27,000 
Total$163,168 $156,846 
Refer to Part I, Item 3. Quantitative and Rs1.7 billion, respectively. The gross notional valueQualitative Disclosures About Market Risk in the MD&A of this Quarterly Report on Form 10-Q for the reclassification of the foreign currency forward contracts to purchase Eurosgain (loss) from AOCL into income and British Pound Sterling with U.S. dollars was €23.0 million and £24.3 million, respectively.
A loss onthe impact of foreign currency forward contractsexchange rate fluctuations, net of $1.0 million was recorded intohedge activity, to operating income for the three months ended February 28, 2022, compared with a gain on forward currency forward contracts of $2.1 million in the same period a year ago. For the six months ended February 28, 2022, a loss on forward currency forward contracts of $1.5 million was recorded into operating income, compared with a gain on forward currency forward contracts of $2.9 million in the prior year period.income.
Critical Accounting Policies and Estimates

We prepare the Consolidated Financial Statements in conformity with GAAP, which requires us to make certain estimates and apply judgements that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures. We base our estimates on historical experience and other assumptions that we believe to be reasonable at the time the Consolidated Financial Statements are prepared and, as such, they may ultimately differ materially from actual results.
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We describe our significant accounting policies in Note 3,2, Summary of Significant Accounting Policies, of in the notes to our Consolidated Financial StatementsNotes included in Item 8 of our Annual Report on Form 10-K for the fiscal year ended August 31, 2021. The2022. These accounting policies usedwere consistently applied in preparing our Consolidated Financial Statements for the six months ended February 28, 2022 are applied consistently with those described2023.
We disclosed our critical accounting estimates in Part II, Item 7 Critical Accounting Estimates in the MD&A of our Annual Report on Form 10-K for the fiscal year ended August 31, 2021.
We discuss our critical accounting estimates in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended August 31, 2021.2022. There were no significant changes in our critical accounting estimates during the six months ended February 28, 2022.2023.
New Accounting Pronouncements
See Note 3,2, RecentSummary of Significant Accounting PronouncementsPolicies, in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for a full description of recent accounting pronouncements, including the expected dates of adoption, which we include herein by reference.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
In the normal course of business, we are exposed to foreign currency exchange risk and interest rate risk that could impact our financial position and results of operations.
Foreign Currency Exchange Risk
We are exposed Current market events have not required us to modify materially or change our financial risk management strategies with respect to our exposures to foreign currency exchange risk asor interest rate risk.
Foreign Currency Transaction Risk
We operate on a global basis and are exposed to the risk that our financial condition, results of operations and cash flows could be impacted by changes in foreign currency exchange rates. To mitigate the volatility and uncertainty of our exchange rate risk, we conduct business outsideentered into foreign currency forward contracts with major institutions related to our primary currencies of the U.S. in several currencies including British Pound Sterling, Euro, Indian Rupee, Euro and Philippine Peso. Changes in the exchange rates for such currencies into U.S. dollars can affect our revenues, earnings, and the carrying valuesAs of February 28, 2023, these forward contracts hedge a portion of our assets and liabilities in our consolidated balance sheet, either positivelyforeign currency transaction exposure ranging from 25% to 75% over their respective hedged periods. We do not enter into cash flow hedges for trading or negatively.speculative purposes.
To manage the exposures related to the effects of foreign exchange rate fluctuations, we utilize derivative instruments (foreign currency forward contracts). The changes in fair value for these foreign currency forward contracts are initially reported as a component of Accumulated other comprehensive loss ("AOCL") and subsequently reclassified into operating expenses when the hedged exposure affects earnings.
A sensitivity analysis was performed based onThe following table reflects the estimated fair value of all foreign currency forward contracts outstanding at February 28, 2022. Ifgain (loss) reclassified from AOCL into income and the U.S. dollar had been 10% weaker,impact of foreign currency exchange rate fluctuations, net of hedge activity, to operating income.
Three Months EndedSix Months Ended
February 28,February 28,
(in thousands)2023202220232022
Foreign currency forward contracts gain (loss) reclassified from AOCL into income$(279)$(1,014)$(5,244)$(1,463)
Foreign currency exchange rate fluctuations increase (decrease) to operating income(1)
$7,662 $(1,156)$16,299 $(5,434)
(1)Impact to operating income is net of hedge activity.
We performed a sensitivity analysis to determine the effects on both the fair value of our outstanding foreign currency forward contracts and our operating income, excluding these forward contracts, of a hypothetical devaluation of the U.S. dollar by 10% as of February 28, 2023, relative to the other foreign currencies in which we transact. Based on the financial results for the six months ended February 28, 2023, the fair value of our outstanding forward contracts would have increased by $9.7$15.9 million and our operating income, excluding these forward contracts, would have decreased by $21.6 million. Such a changeThis sensitivity analysis has inherent limitations as it disregards the possibility that rates of multiple foreign currencies will not always move in fairthe same direction relative to the value of our financial instruments would be substantially offset by changes in our expense base. If we had no hedges in place as of February 28, 2022, a hypothetical 10% weakerthe U.S. dollar against all foreign currencies from the quoted foreign currencyover time and does not account for our forward contracts that we utilize to mitigate fluctuations in exchange rates at February 28, 2022, with operating results held constant in local currencies, would result in a decrease in operating income by $41.5 million over the next 12 months. A hypothetical 10% weaker U.S. dollar against all foreign currencies at February 28, 2022 would have increased the fair value of total assets by $67.9 million and equity by $47.1 million.rates.
Refer to Note 6,5, Derivative Instruments in the Notes to our Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for more information on our foreign currency exposures and our foreign currency forward contracts.
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Foreign Currency Translation Risk
We are exposed to foreign currency risk due to the translation of our results from certain international operations into U.S. Dollars, as part of the consolidation process. Fluctuations in foreign currency exchange rates can create volatility in our results of operations and our financial condition.
The following table reflects the foreign currency translation adjustment gains and losses recorded in Other comprehensive income (loss).
Three Months EndedSix Months Ended
February 28,February 28,
(in thousands)2023202220232022
Foreign currency translation adjustment gains (losses)$3,070 $(2,983)$11,839 $(21,696)
Interest Rate Risk
Cash and Cash Equivalents and Investments
The fair market valueAs of ourFebruary 28, 2023, we had Cash and cash equivalents of $445.3 million and Investments at February 28, 2022 was $808.0of $32.0 million. Our cashCash and cash equivalents consist of cash and highly liquid investments including demand deposits and money market funds, with original maturitiesand our Investments consist of three months or less and are reported at fair value.mutual funds. We are exposed to interest rate risk through fluctuations of interest rates on our investments. As we have a restrictive investment policy, our financial exposure to fluctuations in interest rates is expected to remain low. Refer to Note 2, Significant Accounting Policies in the Notes included in Item 8. of our Annual Report on Form 10-K for more information on our cash and cash equivalents.
Debt
20192022 Credit Agreement
As of February 28, 2022, we had long-term2023, our outstanding variable interest rate debt outstandingincluded $500.0 million under the 20192022 Term Facility and $250.0 million under the 2022 Revolving Credit Facility with a principal balance of $575.0 million. The debt bears interest onFacility. During the six months ended February 28, 2023, the outstanding principleborrowings under the 2022 Credit Facilities bore interest at a rate equal to LIBORthe applicable one-month Term SOFR rate plus a spread using a debt leverage pricing grid. grid, currently at 1.1% (comprised of a 1.0% interest rate margin based on a debt leverage pricing grid plus a 0.1% credit spread adjustment). The spread remained consistent from the date of borrowing through February 28, 2023.
The variable rate of interest on our long-term debt createdcreates exposure to interest rate volatility due to changes in LIBOR.SOFR. To mitigate this exposure, on March 5, 2020,1, 2022, we entered into the 20202022 Swap Agreement (as defined in Note 6, Derivative Instruments)to hedge a portion of our outstanding floating SOFR rate debt with a fixed interest rate of 1.162%, to maintain an intended fixed to floating interest rate ratio. The notional amount of $287.5the 2022 Swap Agreement declines by $100.0 million to hedgeon a quarterly basis. Effective December 30, 2022, we apportioned the variable interest rate obligation, effectively convertingthen-outstanding notional amount of the floating interest rate to fixed for2022 Swap Agreement between two counterparties. As of February 28, 2023, the hedged portion. Thus, ournotional amount of the 2022 Swap Agreement was $400.0 million, maturing on February 28, 2024.
Our exposure wasis limited to base interest rate riskfluctuations in SOFR on floating rateour borrowings from the 2022 Credit Facilities in excess of any amounts that are not hedged, or $287.5$350.0 million of our outstanding principal balance. Assuming all terms of our outstanding long-term debt remained the same, a hypothetical 25 basis point change (up or down) in the one-month LIBOR providedSOFR would create an exposure of $0.7$0.9 million to our annual interest expense.
Refer to Note 11, Debtin the Notes to our Consolidated Financial Statements included in Part 1, Item 1 of this Quarterly Report on Form 10-Q for additional information regarding our outstanding debt obligations.
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As of March 1, 2022, we repaid in full and terminated our 2019 Credit Agreement. Refer to Note 17, Subsequent Events for more information on the termination.
2022 Credit Agreement
On March 1, 2022, FactSet Research Systems Inc. borrowed $1.0 billion under the 2022 Term Facility and $250.0 million under the 2022 Revolving Facility. The debt will bear interest on the outstanding principle at an applicable Secured Overnight Financing Rate ("SOFR") rate plus a spread, using a debt leverage pricing grid. The variable rate of interest on our long-term debt creates exposure to interest rate volatility due to changes in SOFR. To mitigate this exposure, on March 1, 2022, we entered into the 2022 Swap Agreement. Refer to Note 17, Subsequent Events, in the Notes to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for more information on these defined terms, our 2022 Term Facility and 2022 Revolving Facility andFacility. Refer to Note 5, Derivative Instruments in the Notes of this Quarterly Report on Form 10-Q for more information on our 2022 Swap Agreement.
Current market events have not required us to modify materially or change our financial risk management strategies with respect to our exposures to foreign currency exchange risk and interest rate risk.
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ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our management, including our Principal Executive Officer and Principal Financial Officer, have evaluated the effectiveness of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as of the end of the period covered by this report. As permitted by SEC guidance, that specifies an assessment of internal controls over financial reporting of a recently acquired business may be excluded from management's evaluation of disclosure controls and procedures for up to a year from the date of acquisition, we have excluded CGS from management's assessment on internal control over financial reporting for the six months ended February 28, 2023. We will continue to evaluate the effectiveness of internal controls over financial reporting as we complete the integration of CGS. CGS represented 9% of our consolidated revenues for the three and six months ended February 28, 2023, and, excluding goodwill and intangible assets, CGS represented 5% percent of our total assets as of February 28, 2023.
Based on thattheir evaluation, theour Principal Executive Officer and Principal Financial Officer have concluded that our disclosure controls and procedures, areexcluding those related to CGS, were effective as of the end of the period covered by this report.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the three and six months ended February 28, 20222023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The information set forth under "Contingencies" in Note 12, Commitments and Contingencies, contained in the Notes to the Consolidated Financial Statements of this Quarterly Report on Form 10-Q is incorporated by reference in answer to this Item.
ITEM 1A. RISK FACTORS
There werehave been no material changes during the six months ended February 28, 2022 to the risk factors identified in our Annual Report on Form 10-K for the fiscal year ended August 31, 2021, except for the addition of certain language in the sections "Operational Risks - Operations outside the United States involve additional requirements and burdens that we may not be able to control or manage successfully" and "Legal & Regulatory Risks - Legislative and regulatory changes in the environments in which we and our clients operate" as set out below.2022.
In addition, included below are risk factors related to the CGS acquisition, the offering of senior notes and the entrance into a new credit facility, which took place on March 1, 2022. Refer to Note 17, Subsequent Events for more information on these transactions.
Operational Risks
Operations outside the United States involve additional requirements and burdens that we may not be able to control or manage successfully
In fiscal 2021, approximately 40% of our revenue related to operations located outside the U.S. In addition, a significant number of our employees, approximately 78%, are located in offices outside the U.S. We expect our growth to continue outside the U.S., with non-U.S. revenues accounting for an increased portion of our total revenue in the future. Our non-U.S. operations
involve risks that differ from or are in addition to those faced by our U.S. operations. These risks include difficulties in developing products, services and technology tailored to the needs of non-U.S. clients, including in emerging markets; different employment laws and rules; rising labor costs in lower-wage countries; difficulties in staffing and managing personnel that are located outside the U.S.; different regulatory, legal and compliance requirements, including in the areas of privacy and data protection, anti-bribery and anti-corruption, trade sanctions and currency controls, marketing and sales and other barriers to conducting business; social and cultural differences, such as language; diverse or less stable political, operating and economic environments and market fluctuations; civil disturbances or other catastrophic events that reduce business activity, including the risk that the current conflict between Ukraine and Russia expands in a way that impacts our business and operations; limited recognition of our brand and intellectual property protection; differing accounting principles and standards; restrictions on or adverse tax consequences from entity management efforts; and changes in U.S. or foreign tax laws. If we are not able to adapt efficiently or manage the business effectively in markets outside the U.S., our business prospects and operating results could be materially and adversely affected.
Legal & Regulatory Risks
Legislative and regulatory changes in the environments in which we and our clients operate
MiFID
In the European Union, the new version of the Markets in Financial Instruments Directive (recast), also known as "MiFID II" became effective in January 2018. Prior to the effectiveness of the UK's withdrawal from the European Union on January 1, 2021, the UK laws and regulations implementing MiFID II were modified to transpose aspects of EU law and address deficiencies that would have otherwise been created as a result of the withdrawal. MiFID II built upon many of the initiatives introduced through MiFID and is intended to help improve the functioning of the European Union single market by achieving a greater consistency of regulatory standards. MiFID originally became effective in 2007. We believe that compliance with MiFID II requirements is time-consuming and costly for the investment managers who are subject to it and will cause clients to adapt their pricing models and business practices significantly. These increased costs may impact our clients’ spending and may cause some investment managers to lose business or withdraw from the market, which may adversely affect demand for our services. However, MiFID II may also present us with new business opportunities for new service offerings. In March 2022, the UK government announced proposed reforms to financial regulation in the UK, which would represent a divergence from the existing UK MiFID regime. Regulatory reform may impact some of our UK-regulated clients and may require them to devote more resource towards realigning their compliance measures, and in some cases ensuring compliance with both the UK and EU regimes. We continue to monitor the impact of UK regulatory change on our clients. We continue to monitor the impact of MiFID II on the investment process and trade lifecycle. We also continue to review the application of key MiFID II requirements and plan to work with our clients to navigate through them.
Risks Relating to the CGS Transaction

We may fail to realize the anticipated benefits of the CGS Transaction.

The success of our acquisition of the CGS business (the "CGS Business") will depend on, among other things, our ability to incorporate the CGS Business into our business in a manner that enhances our value proposition to clients and facilitates other growth opportunities. We must successfully include the CGS Business within our business in a manner that permits these growth opportunities to be realized. In addition, we must achieve the growth opportunities without adversely affecting current revenues and investments in other future growth. If we are not able to successfully achieve these objectives, the anticipated benefits of the acquisition of CGS (the "CGS Transaction") may not be realized fully, if at all, or may take longer to realize than expected. Additionally, management may face challenges in incorporating certain elements and functions of the CGS Business with the FactSet business, and this process may result in additional and unforeseen expenses. The CGS Transaction may also disrupt the CGS Business’s and FactSet’s ongoing business or cause inconsistencies in standards, controls, procedures and policies that adversely affect our relationships with third party partners, employees, suppliers, customers and others with whom the CGS Business and FactSet have business or other dealings or limit our ability to achieve the anticipated benefits of the CGS Transaction. It is possible that our experience in operating the CGS Business will require us to adjust our expectations regarding the impact of the CGS Transaction on our operating results. If we are not able to successfully add the CGS Business to the existing FactSet business in an efficient, effective and timely manner, anticipated benefits, including the opportunities for growth we expect from the CGS Transaction, may not be realized fully, if at all, or may take longer to realize than expected, and our cash flow and financial condition may be negatively affected.

We will incur significant transaction costs in connection with the CGS Transaction.

We have incurred a number of non-recurring costs associated with the CGS Transaction. These costs and expenses include financial advisory, legal, accounting, consulting and other advisory fees and expenses, filing fees and other related charges. There is also a large number of processes, policies, procedures, operations, technologies and systems that must be integrated in connection with the CGS Transaction. While we have assumed that a certain level of expenses would be incurred in connection with the CGS Transaction and related transactions, there are many factors beyond our control that could affect the total amount or the timing of the integration and implementation expenses.

There may also be additional unanticipated significant costs in connection with the CGS Transaction that we may not recoup. These costs and expenses could reduce the benefits and additional income we expect to achieve from the CGS Transaction. Although we expect that these benefits will offset the transaction expenses and implementation costs over time, this net benefit may not be achieved in the near term or at all.

Third parties may terminate or alter existing contracts or relationships with FactSet or the CGS Business.

The CGS Business has contracts with customers, licensors and other business partners which may require the CGS Business to obtain consent from these other parties in connection with the CGS Transaction. If these consents cannot be obtained, the CGS Business may suffer a loss of potential future revenue and may lose rights that are material to the CGS Business. In addition, third parties with which we or the CGS Business currently have relationships may terminate or otherwise reduce the scope of their relationships with us following the CGS Transaction. Any such disruptions could limit our ability to achieve the anticipated benefits of the CGS Transaction.

FactSet and the CGS Business may have difficulty attracting, motivating and retaining key personnel and other employees in light of the CGS Transaction.

The CGS Business’s success after the CGS Transaction will depend in part on its ability to attract and retain key personnel and other employees. Following the CGS Transaction, FactSet and the CGS Business may lose key personnel or may be unable to attract, retain and motivate qualified individuals, or the associated costs may increase. If the CGS Business cannot retain employees of the CGS Business because of uncertainty relating to the CGS Transaction or the difficulty of integration or for any other reason, the CGS Business’s ability to realize the anticipated benefits of the CGS Transaction could be reduced, and it may have a material adverse impact on the business and operations of the CGS Business.

Risks Relating to our Debt

Our indebtedness may impair our financial condition and prevent us from fulfilling our obligations under the senior notes and our other debt instruments.

As of March 1, 2022, giving effect to the issuance of the senior notes and the incurrence of borrowings under the 2022 Credit Facilities and the repayment of the 2019 Revolving Facility, the total outstanding debt of FactSet was $2.25 billion, none of which is secured. Under the 2022 Revolving Facility, we have $250 million of unused commitments and an option to increase the size of the facility by an additional $750 million.

Our indebtedness could have important consequences to investors, including:

a.making it more difficult for us to satisfy our obligations;
b.limiting our ability to borrow additional amounts to fund working capital, capital expenditures, acquisitions, debt service requirements, execution of our growth strategy and other purposes;
c.requiring us to dedicate a substantial portion of our cash flow from operations to pay interest on our debt and scheduled amortization on the 2022 Term Facility, which would reduce availability of our cash flow to fund working capital, capital expenditures, acquisitions, execution of our strategy and other general corporate purposes;
d.making us more vulnerable to adverse changes in general economic, industry and government regulations and in our business by limiting our flexibility in planning for, and making it more difficult for us to react quickly to, changing conditions;
e.placing us at a competitive disadvantage compared with those of our competitors that have less debt; and
f.exposing us to risks inherent in interest rate fluctuations because some of our borrowings are at variable rates of interest, which could result in higher interest expense in the event of increases in market interest rates.

In addition, we may not be able to generate sufficient cash flow from our operations to repay our indebtedness when it becomes due and to meet our other cash needs. If we are not able to pay our debts as they become due, we will be required to pursue one or more alternative strategies, such as selling assets, refinancing or restructuring our indebtedness or selling additional debt or equity securities. We may not be able to refinance our debt or sell additional debt or equity securities or our assets on favorable terms, if at all, and if we must sell our assets, it may negatively affect our ability to generate revenues.

Despite current indebtedness levels, we may still incur more debt. The incurrence of additional debt could further exacerbate the risks associated with our indebtedness.

Subject to certain limitations, the 2022 Credit Agreement and the indenture governing the senior notes permit us and our subsidiaries to incur additional debt. If new debt is added to our or any such subsidiary’s current debt levels, the risks described above in the previous risk factor could intensify.

The restrictive covenants in our debt may affect our ability to operate our business successfully.

The 2022 Credit Agreement contains, and our future debt instruments may contain, various provisions that limit our ability to, among other things: incur liens; incur additional indebtedness, guarantees or other contingent obligations; enter into sale and leaseback transactions; engage in mergers and consolidations; make investments and acquisitions; change the nature of our business; and make sales, transfers and other dispositions of property and assets. The indenture governing the senior notes also contains various provisions that limit our ability to, among other things: incur liens; enter into sale and leaseback transactions; engage in mergers and consolidations; and make sales, transfers and other dispositions of property and assets. These covenants could adversely affect our ability to finance our future operations or capital needs and pursue available business opportunities.

In addition, the 2022 Credit Agreement requires us to maintain specified financial ratios and satisfy certain financial condition tests. Events beyond our control, including changes in general economic and business conditions, may affect our ability to meet those financial ratios and financial condition tests. We cannot assure you that we will meet those tests or that the lenders will waive any failure to meet those tests. A breach of any of these covenants or any other restrictive covenants contained in the definitive documentation governing our indebtedness would result in a default or an event of default. If an event of default in respect of any of our indebtedness occurs, the holders of the affected indebtedness could declare all amounts outstanding, together with accrued interest, to be immediately due and payable, which, in turn, could cause the default and acceleration of the maturity of our other indebtedness. We expect we will be permitted to incur substantial amounts of secured debt under the covenants in the indenture governing the senior notes and the 2022 Credit Facilities. If, upon an acceleration, we were unable to pay amounts owed in respect of any such indebtedness secured by liens on our assets, then the lenders of such indebtedness could proceed against the collateral pledged to them.

Certain of our borrowings and other obligations are based upon variable rates of interest, which could result in higher expense in the event of increases in interest rates.

The 2022 Credit Agreement provides that (i) loans denominated in U.S. dollars, at our option, will bear interest at either one-month Term SOFR (with a 10 basis points credit spread adjustment and subject to a “zero” floor), Daily Simple SOFR (with a 10 basis points credit spread adjustment and subject to a “zero” floor) or an alternate base rate, (ii) loans denominated in Pounds Sterling will bear interest at Daily Simple Sterling Overnight Index Average ("SONIA") (subject to a “zero” floor) and (iii) loans denominated in Euros will bear interest at Euro Interbank Offered Rate ("EURIBOR") (subject to a “zero” floor), in each case, plus an applicable interest rate margin. An increase in the alternate base rate, Term SOFR, Daily Simple SOFR, SONIA or EURIBOR would increase our interest payment obligations under the 2022 Credit Facilities and could have a negative effect on our cash flow and financial condition.

To mitigate this exposure, on March 1, 2022, we entered into an interest rate swap agreement with a notional amount of $800.0 million to hedge the variable interest rate obligation on a portion of our outstanding balance under the 2022 Credit Agreement. However, as the interest rate swap agreement covers only a portion of our outstanding balance under the 2022 Credit Agreement, a substantial portion of our outstanding balance under the 2022 Credit Agreement continues to be exposed to interest rate volatility. An increase in the applicable rates would increase our interest payment obligations under the 2022 Credit Agreement and could have a negative effect on our cash flow and financial condition.
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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Items 2(a) and (b) are not applicable as there have been no unregistered sales of equity securities.
(i)Issuer Purchases of Equity Securities (in thousands, except share and per share data)
The following table provides a month-to-month summary of theour share repurchase activity during the three months ended February 28, 2022:2023:
Period
Total Number of
Shares Purchased(1)
Average Price
Paid per Share
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2)
Maximum Number of Shares (or Approximate Dollar Value)
that May Yet be Purchased Under the Plans or Programs (in US$)(2)
December 2021317 $488.87 — $181,254 
January 2022344 $429.50 — $181,254 
February 202214 $421.33 — $181,254 
Total675 — 
Period
Total Number of
Shares Purchased(1)
Average Price
Paid per Share
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2)
Maximum Number of Shares (or Approximate Dollar Value)
that May Yet be Purchased Under the Plans or Programs (in US$)(2)
December 2022— $— — $181,254 
January 2023— $— — $181,254 
February 20231,853 $426.55 — $181,254 
Total1,853 — 
(1)Includes675Relates to shares repurchased to satisfy withholding tax obligations due upon the vesting or exercise of stock-based awards.
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(2)As of February 28, 2023, a total of $181.3 million remained available for future share repurchases under our existing share repurchase program. Repurchases may be made from time to time in the open market and privately negotiated transactions, subject to market conditions. No minimum number of shares to be repurchased has been fixed. There is no timeframe to complete the share repurchase program and it is expected that share repurchases will be paid using existing and future cash generated by operations. Beginning in the second quarter of fiscal 2022, we suspended our share repurchase program throughuntil at least the second half of fiscal 2023, with the exception of potential minor repurchases to offset dilution from grants of equity awards or repurchases to satisfy withholding tax obligations due upon the vesting of stock-based awards. The suspension of our share repurchase program allowsallowed us to prioritize the repayment of debt under the 2022 Credit Agreement.Facilities. We anticipate resuming the existing share repurchase program for the third and fourth quarters of fiscal 2023. Refer to Note 17, Subsequent Events11, Debt in the Notes of this Quarterly Report on Form 10-Q for more information on the 2022 Credit Agreement.Facilities.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
None.

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ITEM 6. EXHIBITS
(a)EXHIBITS
(b)The information required by this Item is set forth below.
Incorporated by Reference
Exhibit Number
Exhibit
Description
FormFile No.Exhibit No.Filing Date
Filed
Herewith

          
8-K001-118691.12/17/2022
8-K001-118692.13/1/2022
    
8-K001-118692.23/1/2022
Incorporated by Reference
Exhibit NumberExhibit
Description
FormFile No.Exhibit No.Filing DateFiled
Herewith
FactSet Research Systems Inc. Second Amended and Restated Articles of Incorporation8-K001-118693.11/10/2023
FactSet Research Systems Inc. Amended and Restated By-Laws8-K001-118693.21/10/2023
Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amendedX
Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amendedX
Certification of the Chief Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002X
Certification of the Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002X
101.INSXBRL Instance Document - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL documentX
101.SCHXBRL Taxonomy Extension SchemaX
101.CALXBRL Taxonomy Extension Calculation LinkbaseX
101.DEFXBRL Taxonomy Extension Definition Linkbase DocumentX
101.LABXBRL Taxonomy Extension Label LinkbaseX
101.PREXBRL Taxonomy Extension Presentation LinkbaseX
104Cover page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)X
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8-K001-118694.13/1/2022
    
8-K001-118694.23/1/2022
8-K001-118694.33/1/2022
8-K001-118694.43/1/2022
    
8-K001-118694.53/1/2022
Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amendedX
Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act, as amendedX
Certification of the Chief Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002X
Certification of the Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002X
101.INSXBRL Instance Document - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL documentX
101.SCHXBRL Taxonomy Extension SchemaX
101.CALXBRL Taxonomy Extension Calculation LinkbaseX
101.DEFXBRL Taxonomy Extension Definition Linkbase DocumentX
101.LABXBRL Taxonomy Extension Label LinkbaseX
101.PREXBRL Taxonomy Extension Presentation LinkbaseX
104Cover page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)X

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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 FACTSET RESEARCH SYSTEMS INC.
(Registrant)
 
Date: April 4, 20223, 2023/s/ LINDA S. HUBER
 Linda S. Huber
 Executive Vice President, Chief Financial Officer
(Principal Financial Officer)
/s/ GREGORY T. MOSKOFF
Gregory T. Moskoff
Managing Director, Controller and Chief Accounting Officer
(Principal Accounting Officer)

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