Cover
Cover - shares | 3 Months Ended | |
Nov. 30, 2022 | Dec. 27, 2022 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Nov. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 1-11869 | |
Entity Registrant Name | FACTSET RESEARCH SYSTEMS INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 13-3362547 | |
Entity Address, Address Line One | 45 Glover Avenue | |
Entity Address, City or Town | Norwalk | |
Entity Address, State or Province | CT | |
Entity Address, Postal Zip Code | 06850 | |
City Area Code | 203 | |
Local Phone Number | 810-1000 | |
Title of 12(b) Security | Common Stock, $0.01 Par Value | |
Trading Symbol | FDS | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 38,251,828 | |
Entity Central Index Key | 0001013237 | |
Current Fiscal Year End Date | --08-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
New York Stock Exchange LLC | ||
Entity Information [Line Items] | ||
Security Exchange Name | NYSE | |
The Nasdaq Stock Market | ||
Entity Information [Line Items] | ||
Security Exchange Name | NASDAQ |
Consolidated Statements of Inco
Consolidated Statements of Income - Unaudited - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Nov. 30, 2022 | Nov. 30, 2021 | |
Income Statement [Abstract] | ||
Revenues | $ 504,815 | $ 424,725 |
Operating expenses | ||
Cost of services | 227,042 | 207,131 |
Selling, general and administrative | 105,596 | 91,238 |
Asset impairments | 282 | 3,695 |
Total operating expenses | 332,920 | 302,064 |
Operating income | 171,895 | 122,661 |
Other income (expense), net | ||
Interest expense, net | (14,332) | (1,494) |
Other income (expense), net | 322 | (1,237) |
Total other income (expense), net | (14,010) | (2,731) |
Income before income taxes | 157,885 | 119,930 |
Provision for income taxes | 21,087 | 12,283 |
Net income | $ 136,798 | $ 107,647 |
Basic earnings per common share (in USD per share) | $ 3.59 | $ 2.86 |
Diluted earnings per common share (in USD per share) | $ 3.52 | $ 2.79 |
Basic weighted average common shares (in shares) | 38,122 | 37,678 |
Diluted weighted average common shares (in shares) | 38,914 | 38,641 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - Unaudited - USD ($) $ in Thousands | 3 Months Ended | ||
Nov. 30, 2022 | Nov. 30, 2021 | ||
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 136,798 | $ 107,647 | |
Other comprehensive income (loss), net of tax | |||
Net unrealized gain (loss) on cash flow hedges | [1] | 6,555 | 5 |
Foreign currency translation adjustment gains (losses) | 8,769 | (18,713) | |
Other comprehensive income (loss) | 15,324 | (18,708) | |
Comprehensive income | $ 152,122 | $ 88,939 | |
[1]For the three months ended November 30, 2022 and 2021, the net unrealized gain on cash flow hedges were net of a tax expense of $2,264 thousand and $1 thousand, respectively. |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income - Unaudited (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2022 | Nov. 30, 2021 | |
Statement of Comprehensive Income [Abstract] | ||
Net unrealized gain (loss) on cash flow hedges, tax expense | $ 2,264 | $ 1 |
Consolidated Balance Sheets - U
Consolidated Balance Sheets - Unaudited - USD ($) $ in Thousands | Nov. 30, 2022 | Aug. 31, 2022 |
ASSETS | ||
Cash and cash equivalents | $ 437,142 | $ 503,273 |
Investments | 32,572 | 33,219 |
Accounts receivable, net of reserves of $3,532 at November 30, 2022 and $2,776 at August 31, 2022 | 227,489 | 204,102 |
Prepaid taxes | 32,178 | 38,539 |
Prepaid expenses and other current assets | 99,826 | 91,214 |
Total current assets | 829,207 | 870,347 |
Property, equipment and leasehold improvements, net | 79,296 | 80,843 |
Goodwill | 974,846 | 965,848 |
Intangible assets, net | 1,882,983 | 1,895,909 |
Deferred taxes | 3,653 | 3,153 |
Lease right-of-use assets, net | 154,125 | 159,458 |
Other assets | 53,430 | 38,747 |
TOTAL ASSETS | 3,977,540 | 4,014,305 |
LIABILITIES | ||
Accounts payable and accrued expenses | 122,710 | 108,395 |
Current lease liabilities | 28,970 | 29,185 |
Accrued compensation | 48,067 | 114,808 |
Deferred revenues | 150,264 | 152,039 |
Dividends payable | 34,010 | 33,860 |
Total current liabilities | 384,021 | 438,287 |
Long-term debt | 1,859,096 | 1,982,424 |
Deferred taxes | 10,991 | 8,800 |
Deferred revenues, non-current | 8,697 | 7,212 |
Taxes payable | 35,334 | 34,211 |
Long-term lease liabilities | 201,964 | 208,622 |
Other liabilities | 3,309 | 3,341 |
TOTAL LIABILITIES | 2,503,412 | 2,682,897 |
Commitments and contingencies (see Note 12) | ||
STOCKHOLDERS’ EQUITY | ||
Preferred stock, $0.01 par value, 10,000,000 shares authorized, none issued | 0 | 0 |
Common stock, $0.01 par value; 150,000,000 shares authorized; 41,848,430 and 41,653,218 shares issued; 38,214,108 and 38,044,756 shares outstanding at November 30, 2022 and August 31, 2022, respectively | 418 | 417 |
Additional paid-in capital | 1,225,947 | 1,190,350 |
Treasury stock, at cost: 3,634,322 and 3,608,462 shares at November 30, 2022 and August 31, 2022, respectively | (941,705) | (930,715) |
Retained earnings | 1,282,527 | 1,179,739 |
Accumulated other comprehensive loss | (93,059) | (108,383) |
TOTAL STOCKHOLDERS’ EQUITY | 1,474,128 | 1,331,408 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 3,977,540 | $ 4,014,305 |
Consolidated Balance Sheets -_2
Consolidated Balance Sheets - Unaudited (Parenthetical) - USD ($) $ in Thousands | Nov. 30, 2022 | Aug. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Accounts receivable reserve | $ 3,532 | $ 2,776 |
Preferred stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 150,000,000 | 150,000,000 |
Common stock, issued (in shares) | 41,848,430 | 41,653,218 |
Common stock, outstanding (in shares) | 38,214,108 | 38,044,756 |
Treasury stock (in shares) | 3,634,322 | 3,608,462 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - Unaudited - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2022 | Nov. 30, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income | $ 136,798 | $ 107,647 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation and amortization | 25,997 | 17,208 |
Amortization of lease right-of-use assets | 9,697 | 11,117 |
Stock-based compensation expense | 12,175 | 10,401 |
Deferred income taxes | (745) | 1,507 |
Asset impairments | 282 | 3,695 |
Changes in assets and liabilities, net of effects of acquisitions | ||
Accounts receivable, net of reserves | (23,647) | (5,268) |
Accounts payable and accrued expenses | 18,744 | 20,702 |
Accrued compensation | (66,796) | (53,457) |
Deferred revenues | (290) | (10,248) |
Taxes payable, net of prepaid taxes | 6,995 | (9,524) |
Lease liabilities, net | (11,237) | (11,992) |
Other, net | (1,337) | (8,870) |
Net cash provided by operating activities | 106,636 | 72,918 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchases of property, equipment, leasehold improvements and internal-use software | (17,960) | (8,583) |
Acquisition of businesses, net of cash and cash equivalents acquired | 0 | (50,018) |
Purchases of investments | (9,892) | (250) |
Net cash used in investing activities | (27,852) | (58,851) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Repayment of debt | (125,000) | 0 |
Dividend payments | (33,665) | (30,656) |
Proceeds from employee stock plans | 23,423 | 35,763 |
Repurchases of common stock | 0 | (18,639) |
Other financing activities | (10,990) | (2,950) |
Net cash provided by / (used in) financing activities | (146,232) | (16,482) |
Effect of exchange rate changes on cash and cash equivalents | 1,317 | (5,550) |
Net increase (decrease) in cash and cash equivalents | (66,131) | (7,965) |
Cash and cash equivalents at beginning of period | 503,273 | 681,865 |
Cash and cash equivalents at end of period | $ 437,142 | $ 673,900 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - Unaudited - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Loss |
Balance, beginning of period (in shares) at Aug. 31, 2021 | 41,163,192 | |||||
Beginning balance at Aug. 31, 2021 | $ 1,016,353 | $ 412 | $ 1,048,305 | $ (905,917) | $ 912,515 | $ (38,962) |
Beginning balance, treasury stock (in shares) at Aug. 31, 2021 | 3,547,773 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 107,647 | 107,647 | ||||
Other comprehensive income (loss) | (18,708) | (18,708) | ||||
Common stock issued for employee stock plans (in shares) | 192,349 | |||||
Common stock issued for employee stock plans | 35,763 | $ 2 | 35,761 | |||
Vesting of restricted stock (in shares) | 17,349 | 6,747 | ||||
Vesting of restricted stock | $ (2,949) | $ (2,949) | ||||
Repurchase of common stock (in shares) | 46,200 | 46,200 | ||||
Repurchases of common stock | $ (18,639) | $ (18,639) | ||||
Stock-based compensation expense | 10,401 | 10,401 | ||||
Dividends declared | (30,973) | (30,973) | ||||
Balance, end of period (in shares) at Nov. 30, 2021 | 41,372,890 | |||||
Ending balance at Nov. 30, 2021 | $ 1,098,895 | $ 414 | 1,094,467 | $ (927,505) | 989,189 | (57,670) |
Ending balance, treasury stock (in shares) at Nov. 30, 2021 | 3,600,720 | |||||
Balance, beginning of period (in shares) at Aug. 31, 2022 | 38,044,756 | 41,653,218 | ||||
Beginning balance at Aug. 31, 2022 | $ 1,331,408 | $ 417 | 1,190,350 | $ (930,715) | 1,179,739 | (108,383) |
Beginning balance, treasury stock (in shares) at Aug. 31, 2022 | 3,608,462 | 3,608,462 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | $ 136,798 | 136,798 | ||||
Other comprehensive income (loss) | 15,324 | 15,324 | ||||
Common stock issued for employee stock plans (in shares) | 131,423 | 410 | ||||
Common stock issued for employee stock plans | 23,257 | $ 1 | 23,422 | $ (166) | ||
Vesting of restricted stock (in shares) | 63,789 | 25,450 | ||||
Vesting of restricted stock | $ (10,824) | $ (10,824) | ||||
Repurchase of common stock (in shares) | 0 | |||||
Repurchases of common stock | $ 0 | |||||
Stock-based compensation expense | 12,175 | 12,175 | ||||
Dividends declared | $ (34,010) | (34,010) | ||||
Balance, end of period (in shares) at Nov. 30, 2022 | 38,214,108 | 41,848,430 | ||||
Ending balance at Nov. 30, 2022 | $ 1,474,128 | $ 418 | $ 1,225,947 | $ (941,705) | $ 1,282,527 | $ (93,059) |
Ending balance, treasury stock (in shares) at Nov. 30, 2022 | 3,634,322 | 3,634,322 |
Description of Business
Description of Business | 3 Months Ended |
Nov. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | DESCRIPTION OF BUSINESS FactSet Research Systems Inc. and its wholly-owned subsidiaries (collectively, "we," "our," "us," the "Company" or "FactSet") is a global financial data and analytics company with an open and flexible digital platform that drives 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 to deliver a differentiated advantage for our clients’ success. For 45 years, our platform has delivered expansive data, sophisticated analytics and flexible technology used by global financial professionals to power their critical investment workflows. As of November 30, 2022, we had more than 7,600 clients comprised of approximately 181,000 investment professionals, including asset managers, bankers, wealth managers, asset owners, channel partners, hedge funds, corporate users, private equity and venture capital professionals. Our on- and off-platform solutions span the investment lifecycle including investment research, portfolio construction and analysis, trade execution, performance measurement, risk management and 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 to analyze, monitor and manage their portfolios. We combine dedicated client service with open and flexible technology offerings, including a configurable desktop and mobile platform, comprehensive data feeds, cloud-based digital solutions and application programming interfaces ("APIs"). Our CUSIP Global Services ("CGS") business supports security master files relied on by the investment industry for critical front, middle and back office functions. We drive our business based on our detailed understanding of our clients’ workflows, which helps us to solve their most complex challenges. We provide them with an open digital platform, connected and reliable data, next-generation workflow solutions and highly committed service specialists. We operate our business through three reportable segments ("segments"): the Americas, EMEA and Asia Pacific. Refer to Note 16, Segment Information , for further discussion. For each of our segments, we execute our strategy through three workflow solutions: Research & Advisory; Analytics & Trading; and Content & Technology Solutions ("CTS"). |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Nov. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | SUMMARY OF SIGNIFICANT 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; 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, 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, financial position, cash flows and equity. Reclassifications We reclassified comparative figures for the three months ended November 30, 2021 related to the impairment of our lease right-of-use ("ROU") assets and property, equipment and leasehold improvements to Asset impairments in the Consolidated Statements of Income and Consolidated Statements of Cash Flows to conform to the current year's presentation. The reclassifications to Asset impairments in the Consolidated Statements of Income was from Selling, general and administrative and Cost of services and in the Consolidated Statements of Cash Flows was from Depreciation and amortization and Lease liabilities, net . Use of Estimates The preparation of our Consolidated Financial Statements and related disclosures, in conformity with GAAP, required management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates may have been made in areas that include income taxes, stock-based compensation, goodwill and intangible assets, business combinations, long-lived assets and contingencies. 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 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 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 $3.5 million and $2.8 million as of November 30, 2022 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 limit 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 of Data 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 three months ended November 30, 2022. Recently Adopted Accounting Pronouncements We did not adopt any new standards or updates issued by the Financial Accounting Standards Board ("FASB") during the three months ended November 30, 2022 that had a material impact on our Consolidated Financial Statements. Accounting Pronouncements Not Yet Adopted Inflation Reduction Act of 2022 On August 16, 2022, the Inflation Reduction Act ("IRA") was signed into law. The IRA contains several revisions to the Internal Revenue Code effective in taxable years beginning after December 31, 2022, including a 15% minimum income tax on certain large corporations and a 1% excise tax on corporate stock repurchases by publicly traded U.S. corporations. We are in the process of evaluating the impact of the IRA. We do not expect this law to have a material impact on our Consolidated Financial Statements. No other new accounting pronouncements issued or effective as of November 30, 2022 have had, or are expected to have, a material impact on our Consolidated Financial Statements. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Nov. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | REVENUE RECOGNITIONWe derive most of our revenues by providing client access to our multi-asset class solutions powered by our content refinery available over the associated contractual term (referred to as the "Hosted Platform"). The Hosted Platform is a subscription- based service that provides client access to various combinations of products and services including workstations, portfolio analytics and enterprise solutions. In addition, through our CGS platform, we provide subscription access to a database of universally recognized identifiers reflecting differentiating characteristics for issuers and their financial instruments (referred to as the "Identifier Platform"). We determined that the majority of each of our Hosted 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 transfer to the client. We also determined the primary nature of the promise to the client is to provide daily access to each of these data and analytics platforms. 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 these platforms, we apply an output time-based measure of progress as the client is simultaneously receiving and consuming the benefits of the platform. We recognize 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 performance 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 products and services, which are recoverable. Fulfillment 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, 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 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 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 Ended November 30, (in thousands) 2022 2021 Americas $ 323,367 $ 266,913 EMEA 130,738 115,003 Asia Pacific 50,710 42,809 Total Revenues $ 504,815 $ 424,725 |
Fair Value Measures
Fair Value Measures | 3 Months Ended |
Nov. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measures | 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. 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 significant inputs are observable or can be derived principally from, or corroborated by, observable market data. 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. (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 as of November 30, 2022 and August 31, 2022. We did not have any transfers between levels of fair value measurements during the periods presented below. We held no Level 3 assets or liabilities measured at fair value on a recurring basis as of November 30, 2022 and August 31, 2022. Fair Value Measurements at November 30, 2022 (in thousands) Level 1 Level 2 Total Assets Corporate money market funds (1) $ 210,951 $ — $ 210,951 Mutual funds (2) — 32,572 32,572 Derivative instruments (3) — 15,410 15,410 Total assets measured at fair value $ 210,951 $ 47,982 $ 258,933 Liabilities Derivative instruments (3) $ — $ 2,486 $ 2,486 Total liabilities measured at fair value $ — $ 2,486 $ 2,486 Fair Value Measurements at August 31, 2022 (in thousands) Level 1 Level 2 Total Assets Corporate money market funds (1) $ 179,330 $ — $ 179,330 Mutual funds (2) — 33,219 33,219 Derivative instruments (3) — 12,412 12,412 Total assets measured at fair value $ 179,330 $ 45,631 $ 224,961 Liabilities Derivative instruments (3) $ — $ 8,307 $ 8,307 Total liabilities measured at fair value $ — $ 8,307 $ 8,307 (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 included in Cash and cash equivalents within the Consolidated Balance Sheets. (2) Our mutual funds have a fair value 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 included in Investments (short-term) within the Consolidated Balance Sheets. (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. To estimate fair value for our interest rate swap agreements, we utilize a present value of future cash flows, leveraging a model-derived valuation that uses observable inputs such as interest rate yield curves. Refer to Note 5 , Derivative Instruments, for more information on our derivative instruments and their classification within the Consolidated Balance Sheets. (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 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 their carrying value may not be fully recoverable, and at least annually for goodwill. (c) Assets and Liabilities Measured at Fair Value for Disclosure Purposes O nly We elected not to carry our Long-term debt at fair value. The carrying value of our Long-term debt is net of related unamortized discount and debt issuance costs. The fair value of our Senior Notes is estimated 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 prices for similar instruments, adjusted for unobservable inputs to ensure comparability to our investment rating, maturity terms and principal outstanding, which are considered Level 3 inputs. Refer to Note 11, Debt for definitions of these terms and more information on the Senior Notes and 2022 Credit Facilities. The following table summarizes information on our outstanding debt as of November 30, 2022 and August 31, 2022: November 30, 2022 August 31, 2022 (in thousands) Fair Value Hierarchy Principal Amount Estimated Fair Value Principal Amount Estimated Fair Value 2027 Notes Level 1 $ 500,000 $ 455,470 $ 500,000 $ 470,525 2032 Notes Level 1 500,000 419,860 500,000 438,205 2022 Term Facility Level 3 625,000 627,344 750,000 750,975 2022 Revolving Facility Level 3 250,000 246,562 250,000 249,075 Total principal amount $ 1,875,000 $ 1,749,236 $ 2,000,000 $ 1,908,780 Total unamortized discounts and debt issuance costs (15,904) (17,576) Total net carrying value of debt $ 1,859,096 $ 1,982,424 |
Derivative Instruments
Derivative Instruments | 3 Months Ended |
Nov. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | DERIVATIVE INSTRUMENTS Cash Flow Hedges In designing our hedging approach, we consider several factors, including offsetting exposures, the significance of exposures, the forecasting of risk and the potential effectiveness of the hedge to reduce the volatility of our earnings and cash 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 in struments 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 2, Summary of Significant Accounting Policies - Concentrations of Credit Risk , for further discussion on counterparty credit risk. 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. W e 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 conduct business outside the U.S. in several 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. As of November 30, 2022, 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, Euro, Indian Rupee 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 set to mature at various points between the second quarter of fiscal 2023 through the first 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 November 30, 2022 and August 31, 2022. November 30, 2022 August 31, 2022 (in thousands) Local Currency Amount Notional Contract Amount (USD) Local Currency Amount Notional Contract Amount (USD) British Pound Sterling £ 48,000 $ 57,337 £ 44,200 $ 55,567 Euro € 38,000 39,892 € 37,500 40,679 Indian Rupee Rs 2,739,827 33,600 Rs 2,667,928 33,600 Philippine Peso ₱ 1,540,066 27,300 ₱ 1,462,060 27,000 Total $ 158,129 $ 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 2020 Swap Agreement On March 5, 2020, we entered into an interest rate swap agreement ("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. 2022 Swap Agreement On March 1, 2022, we entered into an interest rate swap agreement ("2022 Swap Agreement") with a notional amount of $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. As of November 30, 2022, the notional amount of the 2022 Swap Agreement was $500.0 million. 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 Instruments The following is a summary of the gross notional values of the derivative instruments: (in thousands) Gross Notional Value November 30, 2022 August 31, 2022 Foreign currency forward contracts $ 158,129 $ 156,846 Interest rate swap agreement 500,000 600,000 Total cash flow hedges $ 658,129 $ 756,846 The following is a summary of the fair values of our derivative instruments: Fair Value of Derivative Instruments (in thousands) Derivative Assets Derivative Liabilities Derivatives designated as hedging instruments Balance Sheet Classification November 30, 2022 August 31, 2022 Balance Sheet Classification November 30, 2022 August 31, 2022 Foreign currency forward contracts Prepaid expenses and other current assets $ 2,467 $ — Accounts payable and accrued expenses $ 2,486 $ 8,307 Interest rate swap agreement Prepaid expenses and other current assets 12,162 10,621 Accounts payable and accrued expenses — — Other assets 781 1,791 Other liabilities — — Total cash flow hedges $ 15,410 $ 12,412 $ 2,486 $ 8,307 All derivatives were designated as hedging instruments as of November 30, 2022 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 November 30, 2022 and November 30, 2021, respectively: Gain (Loss) Recognized in AOCL on Derivatives Location of Gain (Loss) Reclassified from AOCL into Income Gain (Loss) Reclassified from AOCL into Income (in thousands) November 30, November 30, Derivatives in Cash Flow Hedging Relationships 2022 2021 2022 2021 Foreign currency forward contracts $ 3,323 $ (3,542) SG&A $ (4,965) $ (449) Interest rate swap agreement 3,428 2,583 Interest expense, net 2,897 (516) Total cash flow hedges $ 6,751 $ (959) $ (2,068) $ (965) As of November 30, 2022, we estimate that net pre-tax derivative gains of $12.1 million included in AOCL will be reclassified into earnings within the next 12 months. As of November 30, 2022, 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 effectiveness. There was no discontinuance of our cash flow hedges during the three months ended November 30, 2022 or November 30, 2021, and as such, no corresponding gains or losses related to changes in the value of our contracts were reclassified into earnings prior to settlement. Offsetting of Derivative Instruments |
Acquisitions
Acquisitions | 3 Months Ended |
Nov. 30, 2022 | |
Business Combinations [Abstract] | |
Acquisitions | ACQUISITIONS During fiscal 2022 and 2021, we completed acquisitions of several businesses, with the most significant cash flows related to the acquisitions of CUSIP Global Services ("CGS") and Cobalt Software, Inc. ("Cobalt"). CUSIP Global Services On March 1, 2022, we completed the acquisition of 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 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 International Securities Identification Number ("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. 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. The acquisition date fair values of major classes of assets acquired and liabilities assumed are as follows: Acquisition Date Fair Value Acquisition Date Useful Life Amortization Method (in thousands) (in years) Current assets (1) $ 29,728 Amortizable intangible assets ABA business process 1,583,000 36 years Straight-line Client relationships 164,000 26 years Straight-line Acquired databases 46,000 15 years Straight-line Goodwill 214,970 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 deferred 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 2, Summary of Significant Accounting Policies in the Notes to the Consolidated Financial Statements 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 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, 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. The Cobalt 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 Cobalt acquisition during the fourth quarter of fiscal 2022 and did not record any material changes to the preliminary purchase price allocation. The acquisition date fair values of major classes of assets acquired and liabilities assumed are as follows: Acquisition Date Fair Value Acquisition Date Useful Life Amortization Method (in thousands) (in years) Current assets $ 540 Amortizable intangible assets Software technology 7,750 5 years Straight-line Client relationships 4,800 11 years Straight-line Goodwill 41,338 Other assets 34 Current liabilities (4,437) Other liabilities (7) Total purchase price $ 50,018 Goodwill totaling $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. |
Goodwill
Goodwill | 3 Months Ended |
Nov. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | GOODWILL Changes in the carrying amount of goodwill by segment for the three months ended November 30, 2022 are as follows: (in thousands) Americas EMEA Asia Pacific Total Balance at August 31, 2022 $ 686,412 $ 277,087 $ 2,349 $ 965,848 Foreign currency translations — 8,984 14 8,998 Balance at November 30, 2022 $ 686,412 $ 286,071 $ 2,363 $ 974,846 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 |
Intangible Assets
Intangible Assets | 3 Months Ended |
Nov. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 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: November 30, 2022 August 31, 2022 (in thousands, except useful lives) Estimated Useful Life (years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount ABA business process 36 $ 1,583,000 $ 32,979 $ 1,550,021 $ 1,583,000 $ 21,986 $ 1,561,014 Client relationships 8 to 26 264,742 59,313 205,429 263,163 55,405 207,758 Software technology 5 to 9 123,584 100,609 22,975 122,363 96,567 25,796 Developed technology 3 to 5 89,081 37,870 51,211 80,956 33,676 47,280 Acquired databases 15 46,000 2,300 43,700 46,000 1,533 44,467 Data content 5 to 20 33,389 26,153 7,236 32,305 24,973 7,332 Trade names 15 6,751 4,340 2,411 6,693 4,431 2,262 Total $ 2,146,547 $ 263,564 $ 1,882,983 $ 2,134,480 $ 238,571 $ 1,895,909 The weighted average useful life of our intangible assets at November 30, 2022 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 November 30, 2022, excluding those acquired from CGS, was 9.5 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 three months ended November 30, 2022 and November 30, 2021. The intangible assets have no assigned residual values. Amortization expense recorded for intangible assets for the three months ended November 30, 2022 and November 30, 2021 was $21.7 million and $10.1 million, respectively. As of November 30, 2022, estimated intangible asset amortization expense for each of the next five years and thereafter are as follows: Fiscal Year (in thousands) Estimated Amortization Expense 2023 (remaining nine months) $ 69,398 2024 82,708 2025 76,216 2026 67,546 2027 62,783 Thereafter 1,524,332 Total $ 1,882,983 |
Income Taxes
Income Taxes | 3 Months Ended |
Nov. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXESIncome 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. Income Tax Provision and Effective Tax Rate The provision for income taxes and effective tax rate are as follows: Three Months Ended November 30, (in thousands) 2022 2021 Income before income taxes $ 157,885 $ 119,930 Provision for income taxes $ 21,087 $ 12,283 Effective tax rate 13.4 % 10.2 % Our effective tax rate is based on recurring factors and non-recurring events, including the taxation of foreign income. Our effective tax rate will vary based on, among other things, changes in levels of foreign income, as well as discrete and other non-recurring events that may not be predictable. For the three months ended November 30, 2022, our effective tax rate is lower than the applicable U.S. corporate income tax rate mainly 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. For the three months ended November 30, 2022, the provision for income taxes was $21.1 million, compared with $12.3 million for the same period a year ago. The provision increased mainly due to higher pretax income at a higher effective tax rate and, to a lesser extent, an increase of the UK statutory tax rate. |
Leases
Leases | 3 Months Ended |
Nov. 30, 2022 | |
Leases [Abstract] | |
Leases | LEASES Our lease portfolio is primarily related to our office space, under various operating lease 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 ROU assets and lease liabilities are 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 IBR. Certain adjustments to calculate our lease ROU assets may be required due to prepayments, lease incentives received and initial direct costs 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 November 30, 2022, we recognized $154.1 million of Lease right-of-use assets, net and $230.9 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 over 13 years and did not include any renewal or termination options that were not yet reasonably certain to be exercised. 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 November 30, 2022 : (in thousands) Minimum Lease Fiscal Years Ended August 31, 2023 (remaining nine months) $ 28,995 2024 35,424 2025 33,332 2026 32,546 2027 31,694 Thereafter 114,070 Total $ 276,061 Less: Imputed interest 45,127 Present value $ 230,934 The following table includes the components of our occupancy costs in our Consolidated Statements of Income: Three Months Ended November 30, (in millions) 2022 2021 Operating lease cost (1) $ 8.1 $ 10.5 Variable lease cost (2) $ 4.2 $ 2.9 (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) Variable lease costs include costs that were not fixed at the lease commencement date and are not dependent on an index or rate. These costs were not included in the measurement of lease liabilities and primarily include variable non-lease costs, such as utilities, real estate taxes, insurance and 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: As of November 30, 2022 As of August 31, 2022 Weighted average remaining lease term (in years) 8.4 8.6 Weighted average discount rate (IBR) 4.4 % 4.4 % The following table summarizes supplemental cash flow information related to our operating leases: Three Months Ended November 30, (in millions) 2022 2021 Cash paid for amounts included in the measurement of lease liabilities $ 9.7 $ 11.1 Lease ROU assets obtained in exchange for lease liabilities (1) $ 0.1 $ 1.4 (1) Primarily includes new lease arrangements entered into during the period and contract modifications that extend our lease terms and/or provide additional rights. |
Debt
Debt | 3 Months Ended |
Nov. 30, 2022 | |
Debt Disclosure [Abstract] | |
Debt | 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 November 30, 2022 and August 31, 2022 consisted of the following: (in thousands) Issuance Date Contractual November 30, 2022 August 31, 2022 2022 Credit Agreement 2022 Term Facility 3/1/2022 3/1/2025 625,000 750,000 2022 Revolving Facility 3/1/2022 3/1/2027 250,000 250,000 Senior Notes 2027 Notes 3/1/2022 3/1/2027 500,000 500,000 2032 Notes 3/1/2022 3/1/2032 500,000 500,000 Total unamortized discounts and debt issuance costs (15,904) (17,576) Total Long-term debt $ 1,859,096 $ 1,982,424 As of November 30, 2022, annual maturities on our total debt obligations, based on contract maturity, were as follows: (in thousands) Maturities Fiscal Years Ended August 31, 2023 (remaining nine months) $ — 2024 — 2025 625,000 2026 — 2027 750,000 Thereafter 500,000 Total $ 1,875,000 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, we terminated the 2019 Credit Agreement and amortized the remaining related $0.4 million of capitalized debt issuance costs into Interest expense, net in the Consolidated Statements of Income. 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 upon our senior unsecured non-credit enhanced long-term debt rating and our total leverage ratio. The commitment fee remained at 0.125% from the borrowing date through November 30, 2022. 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 and to pay related transaction fees, costs and expenses. During fiscal 2022, we incurred approximately $9.5 million in debt issuance costs related to the 2022 Credit Facilities. Debt issuance costs are presented in the Consolidated Balance Sheets as a direct deduction from the carrying amount of the related debt liability. Debt issuance costs are amortized to Interest expense, net in the Consolidated Statements of Income over the contractual term of the debt on a straight-line basis, 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 first quarter of fiscal 2023, we repaid $125.0 million under the 2022 Term Facility, inclusive of voluntary prepayments of $112.5 million. Since March 1, 2022, we have repaid $375.0 million under the 2022 Term Facility, inclusive of voluntary prepayments of $350.0 million. As of November 30, 2022, the outstanding borrowings under the 2022 Credit Facilities bore interest at a rate equal to the applicable one-month Term SOFR rate plus a 1.1% spread (comprised of a 1.0% interest rate margin based on a debt leverage pricing grid plus 0.1% credit spread adjustment). The spread remained consistent from the borrowing date through November 30, 2022. 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 November 30, 2022. We were in compliance with all covenants and requirements of the 2022 Credit Agreement as of November 30, 2022. 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"). 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 related 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. Swap Agreements On March 5, 2020, we entered into the 2020 Swap Agreement to hedge a portion of our then outstanding floating LIBOR rate 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%. Refer to Note 5, Derivative Instruments for further discussion of the 2020 Swap Agreement and 2022 Swap Agreement. Interest Expense On March 1, 2022, the 2019 Revolving Credit Facility and 2020 Swap Agreement were both terminated and concurrently replaced with the 2022 Credit Facilities, Senior Notes and 2022 Swap Agreement. For the three months ended November 30, 2022 and November 30, 2021, we recorded interest expense on our outstanding debt, including the related amortization of debt issuance costs and debt discounts, net of the effects of the related interest rate swap agreements, of $16.5 million and $1.9 million, respectively in Interest expense, net in the Consolidated Statements of Income. 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 3.12% and 2.02% as of November 30, 2022 and August 31, 2022, respectively. Refer to Note 5, Derivative Instruments for further discussion of the 2020 Swap Agreement and 2022 Swap Agreement. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Nov. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 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 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. As of August 31, 2022, we had total purchase obligations with suppliers of $373.9 million. Our total purchase obligations as of August 31, 2022 primarily related to hosting services and data acquisition, and, to a lesser extent, by third-party software providers. Hosting services support our technology investments related to our migration to cloud-based hosting services, the majority of which rely on third-party hosting providers. Data is an integral component of the value we provide to our clients and third-party software mainly includes internal-use software licenses. Since August 31, 2022, there were no material changes to our contractual obligations. We also have 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 both November 30, 2022 and August 31, 2022, we had outstanding capital commitments related to an investment of $1.1 million. Letters of Credit From time to time, we are required to obtain letters of credit in the ordinary course of business. As of both November 30, 2022 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 information available at November 30, 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. 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 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. 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 (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 First Notice and Second Notice, and intend to file an appeal with respect to the Third Notice, 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 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. 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 agreements. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Nov. 30, 2022 | |
Equity [Abstract] | |
Stockholders' Equity | STOCKHOLDERS’ EQUITY S hare Repurchases Three Months Ended November 30, (in thousands) 2022 2021 Repurchase of common stock under the share repurchase program (1) — (46) Total cost of shares repurchased (1) $ — $ 18,639 Amount authorized for future repurchase under the share repurchase program (2) $ 181,300 $ 181,300 (1) Amounts do not include 25,450 shares and 6,747 shares surrendered by grantees to satisfy withholding tax obligations due upon the vesting or exercise of stock-based awards valued at $10.8 million and $2.9 million during the three months ended November 30, 2022 and November 30, 2021, respectively. (2) 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-time in the open market and privately negotiated transactions, subject to market conditions. For the three months ended November 30, 2022, we did not make any repurchases under our existing program, compared to 46,200 shares repurchased for $18.6 million for the three months ended November 30, 2021. 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 allows us to prioritize the repayment of debt under the 2022 Credit Facilities. Refer to Note 11, Debt for more information on the 2022 Credit Facilities. Equity-based Awards Refer to Note 15, Stock-Based Compensation for more information on equity awards issued during the three months ended November 30, 2022 and November 30, 2021. Dividends Our Board of Directors declared dividends during the three months ended November 30, 2022 and November 30, 2021 as follows: Year Ended Dividends per Record Date Total $ Amount Payment Date Fiscal 2023 First Quarter $ 0.89 November 30, 2022 $ 34,010 December 15, 2022 Fiscal 2022 First Quarter $ 0.82 November 30, 2021 $ 30,973 December 16, 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) November 30, 2022 August 31, 2022 Accumulated unrealized gains (losses) on cash flow hedges, net of tax $ 9,704 $ 3,149 Accumulated foreign currency translation adjustments (102,763) (111,532) Total AOCL $ (93,059) $ (108,383) |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Nov. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | EARNINGS PER SHARE Basic earnings per share ("EPS") is computed by dividing net income by the number of weighted average common shares outstanding during the period. 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 November 30, 2022 are omitted from the calculation of diluted EPS. A reconciliation of the weighted average shares outstanding used in the basic and diluted earnings per share ("EPS") computation is as follows: Three Months Ended November 30, (in thousands, except per share data) 2022 2021 Numerator Net income used for calculating basic and diluted income per share $ 136,798 $ 107,647 Denominator Weighted average common shares used in the calculation of basic income per share 38,122 37,678 Common stock equivalents associated with stock-based compensation plan (1) 792 963 Shares used in the calculation of diluted income per share 38,914 38,641 Basic income per share $ 3.59 $ 2.86 Diluted income per share $ 3.52 $ 2.79 (1) Dilutive potential common shares consist of stock options and unvested PSUs. For the three months ended November 30, 2022 and November 30, 2021, there were 545,510 and 298,900 common stock equivalents associated with our stock options excluded from the calculation of diluted EPS, respectively, as they were out-of-the-money and their inclusion would have been anti-dilutive. Common stock equivalents associated with our PSUs excluded from the calculation of diluted EPS for the three months ended November 30, 2022 and November 30, 2021, were 94,162 and 97,511, respectively. |
Stock Based Compensation
Stock Based Compensation | 3 Months Ended |
Nov. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock Based Compensation | 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 new stock option grants and restricted stock units ("RSUs") granted to non-employees 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 new employee stock option grants and employee RSUs and PSUs to estimate the grant-date fair value. 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 $12.2 million and $10.4 million during the three months ended November 30, 2022 and November 30, 2021, respectively. As of November 30, 2022, $153.6 million of total unrecognized compensation expense related to non-vested awards is expected to be recognized over a weighted average period of 3.4 years. There was no stock-based compensation capitalized as of November 30, 2022 and November 30, 2021. Employee Stock Option Awards Under the FactSet Research Systems Inc. Stock Option and Award Plan, as Amended and Restated (the "LTIP"), we granted the following stock options for the three months ended November 30, 2022 and November 30, 2021, which are valued using the lattice-binomial option-pricing model. As of November 30, 2022, we had 4.2 million stock-based awards available for grant under the LTIP. Three Months Ended November 30, 2022 2021 Stock options granted (1) 267,296 299,702 Weighted average exercise price $ 426.25 $ 434.82 Weighted average grant date fair value $ 125.59 $ 102.40 (1) The majority of the stock options granted relate to the November 1, 2022 and November 1, 2021 annual employee grants that both 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. We granted 266,051 employee stock options 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 rate 3.99% - 4.51% Expected life (years) 6.62 Expected volatility 24.7% Dividend yield 0.83% Estimated fair value $125.62 Exercise price $426.25 Employee Restricted Stock Awards Our LTIP provides for the grant of stock-based awards, including Restricted Stock Awards. The Restricted Stock Awards are subject to continued employment over a specified period. The Restricted Stock Awards granted to employees 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. 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. 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 three months ended November 30, 2022 and November 30, 2021. Three Months Ended November 30, 2022 2021 RSUs Granted (1) 47,038 43,613 PSUs Granted (2) 34,482 30,460 Total Restricted Stock Awards 81,520 74,073 Restricted Stock Awards weighted average grant date fair value $ 415.31 $ 424.14 (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. 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 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. Shares purchased through the ESPP cannot be sold or otherwise transferred for 18 months after purchase. Dividends paid on shares held in the ESPP are used to purchase additional ESPP shares at the market price on the dividend payment date. Stock-based compensation expense related to the ESPP was $0.7 million for the three months ended November 30, 2022 and $0.5 million for the three months ended November 30, 2021. As of November 30, 2022 the ESPP had 93,853 shares reserved for future issuance. |
Segment Information
Segment Information | 3 Months Ended |
Nov. 30, 2022 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION 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. The following tables reflect the results of operations of our segments as of November 30, 2022 and November 30, 2021: (in thousands) Americas EMEA Asia Pacific Total For the three months ended November 30, 2022 Revenues $ 323,367 $ 130,738 $ 50,710 $ 504,815 Operating income $ 67,531 $ 67,322 $ 37,042 $ 171,895 Capital expenditures $ 15,754 $ 573 $ 1,633 $ 17,960 (in thousands) Americas EMEA Asia Pacific Total For the three months ended November 30, 2021 Revenues $ 266,913 $ 115,003 $ 42,809 $ 424,725 Operating income $ 55,498 $ 40,654 $ 26,509 $ 122,661 Capital expenditures $ 7,203 $ 110 $ 1,270 $ 8,583 Segment Total Assets The following table reflects the total assets for our segments: (in thousands) November 30, 2022 August 31, 2022 Segment Assets Americas $ 3,214,785 $ 3,191,313 EMEA 518,976 580,450 Asia Pacific 243,779 242,542 Total assets $ 3,977,540 $ 4,014,305 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Nov. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Accounting | 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; 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, 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, financial position, cash flows and equity. |
Reclassifications | Reclassifications We reclassified comparative figures for the three months ended November 30, 2021 related to the impairment of our lease right-of-use ("ROU") assets and property, equipment and leasehold improvements to Asset impairments in the Consolidated Statements of Income and Consolidated Statements of Cash Flows to conform to the current year's presentation. The reclassifications to Asset impairments in the Consolidated Statements of Income was from Selling, general and administrative and Cost of services and in the Consolidated Statements of Cash Flows was from Depreciation and amortization and Lease liabilities, net |
Use of Estimates | Use of Estimates The preparation of our Consolidated Financial Statements and related disclosures, in conformity with GAAP, required management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates may have been made in areas that include income taxes, stock-based compensation, goodwill and intangible assets, business combinations, long-lived assets and contingencies. 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 Risk and Data Providers | Concentrations of Credit Risks 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 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 $3.5 million and $2.8 million as of November 30, 2022 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 limit 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 of Data 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 three months ended November 30, 2022. |
Recently Adopted Accounting Pronouncements and Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements We did not adopt any new standards or updates issued by the Financial Accounting Standards Board ("FASB") during the three months ended November 30, 2022 that had a material impact on our Consolidated Financial Statements. Accounting Pronouncements Not Yet Adopted Inflation Reduction Act of 2022 On August 16, 2022, the Inflation Reduction Act ("IRA") was signed into law. The IRA contains several revisions to the Internal Revenue Code effective in taxable years beginning after December 31, 2022, including a 15% minimum income tax on certain large corporations and a 1% excise tax on corporate stock repurchases by publicly traded U.S. corporations. We are in the process of evaluating the impact of the IRA. We do not expect this law to have a material impact on our Consolidated Financial Statements. No other new accounting pronouncements issued or effective as of November 30, 2022 have had, or are expected to have, a material impact on our Consolidated Financial Statements. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Nov. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of revenue | The following table presents this disaggregation by segment: Three Months Ended November 30, (in thousands) 2022 2021 Americas $ 323,367 $ 266,913 EMEA 130,738 115,003 Asia Pacific 50,710 42,809 Total Revenues $ 504,815 $ 424,725 |
Fair Value Measures (Tables)
Fair Value Measures (Tables) | 3 Months Ended |
Nov. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of 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 as of November 30, 2022 and August 31, 2022. We did not have any transfers between levels of fair value measurements during the periods presented below. We held no Level 3 assets or liabilities measured at fair value on a recurring basis as of November 30, 2022 and August 31, 2022. Fair Value Measurements at November 30, 2022 (in thousands) Level 1 Level 2 Total Assets Corporate money market funds (1) $ 210,951 $ — $ 210,951 Mutual funds (2) — 32,572 32,572 Derivative instruments (3) — 15,410 15,410 Total assets measured at fair value $ 210,951 $ 47,982 $ 258,933 Liabilities Derivative instruments (3) $ — $ 2,486 $ 2,486 Total liabilities measured at fair value $ — $ 2,486 $ 2,486 Fair Value Measurements at August 31, 2022 (in thousands) Level 1 Level 2 Total Assets Corporate money market funds (1) $ 179,330 $ — $ 179,330 Mutual funds (2) — 33,219 33,219 Derivative instruments (3) — 12,412 12,412 Total assets measured at fair value $ 179,330 $ 45,631 $ 224,961 Liabilities Derivative instruments (3) $ — $ 8,307 $ 8,307 Total liabilities measured at fair value $ — $ 8,307 $ 8,307 (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 included in Cash and cash equivalents within the Consolidated Balance Sheets. (2) Our mutual funds have a fair value 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 included in Investments (short-term) within the Consolidated Balance Sheets. (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. To estimate fair value for our interest rate swap agreements, we utilize a present value of future cash flows, leveraging a model-derived valuation that uses observable inputs such as interest rate yield curves. Refer to Note 5 , Derivative Instruments, for more information on our derivative instruments and their classification within the Consolidated Balance Sheets. |
Schedule of assets and liabilities measured at carrying value and fair value | The following table summarizes information on our outstanding debt as of November 30, 2022 and August 31, 2022: November 30, 2022 August 31, 2022 (in thousands) Fair Value Hierarchy Principal Amount Estimated Fair Value Principal Amount Estimated Fair Value 2027 Notes Level 1 $ 500,000 $ 455,470 $ 500,000 $ 470,525 2032 Notes Level 1 500,000 419,860 500,000 438,205 2022 Term Facility Level 3 625,000 627,344 750,000 750,975 2022 Revolving Facility Level 3 250,000 246,562 250,000 249,075 Total principal amount $ 1,875,000 $ 1,749,236 $ 2,000,000 $ 1,908,780 Total unamortized discounts and debt issuance costs (15,904) (17,576) Total net carrying value of debt $ 1,859,096 $ 1,982,424 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 3 Months Ended |
Nov. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Summary of gross notional values of derivative instruments | 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 November 30, 2022 and August 31, 2022. November 30, 2022 August 31, 2022 (in thousands) Local Currency Amount Notional Contract Amount (USD) Local Currency Amount Notional Contract Amount (USD) British Pound Sterling £ 48,000 $ 57,337 £ 44,200 $ 55,567 Euro € 38,000 39,892 € 37,500 40,679 Indian Rupee Rs 2,739,827 33,600 Rs 2,667,928 33,600 Philippine Peso ₱ 1,540,066 27,300 ₱ 1,462,060 27,000 Total $ 158,129 $ 156,846 The following is a summary of the gross notional values of the derivative instruments: (in thousands) Gross Notional Value November 30, 2022 August 31, 2022 Foreign currency forward contracts $ 158,129 $ 156,846 Interest rate swap agreement 500,000 600,000 Total cash flow hedges $ 658,129 $ 756,846 |
Summary of the fair values of derivative instruments | The following is a summary of the fair values of our derivative instruments: Fair Value of Derivative Instruments (in thousands) Derivative Assets Derivative Liabilities Derivatives designated as hedging instruments Balance Sheet Classification November 30, 2022 August 31, 2022 Balance Sheet Classification November 30, 2022 August 31, 2022 Foreign currency forward contracts Prepaid expenses and other current assets $ 2,467 $ — Accounts payable and accrued expenses $ 2,486 $ 8,307 Interest rate swap agreement Prepaid expenses and other current assets 12,162 10,621 Accounts payable and accrued expenses — — Other assets 781 1,791 Other liabilities — — Total cash flow hedges $ 15,410 $ 12,412 $ 2,486 $ 8,307 |
Schedule of pre-tax effect of derivative instruments 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 November 30, 2022 and November 30, 2021, respectively: Gain (Loss) Recognized in AOCL on Derivatives Location of Gain (Loss) Reclassified from AOCL into Income Gain (Loss) Reclassified from AOCL into Income (in thousands) November 30, November 30, Derivatives in Cash Flow Hedging Relationships 2022 2021 2022 2021 Foreign currency forward contracts $ 3,323 $ (3,542) SG&A $ (4,965) $ (449) Interest rate swap agreement 3,428 2,583 Interest expense, net 2,897 (516) Total cash flow hedges $ 6,751 $ (959) $ (2,068) $ (965) |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Nov. 30, 2022 | |
Business Combinations [Abstract] | |
Schedule of acquisition date fair values of major classes of assets acquired and liabilities assumed | The acquisition date fair values of major classes of assets acquired and liabilities assumed are as follows: Acquisition Date Fair Value Acquisition Date Useful Life Amortization Method (in thousands) (in years) Current assets (1) $ 29,728 Amortizable intangible assets ABA business process 1,583,000 36 years Straight-line Client relationships 164,000 26 years Straight-line Acquired databases 46,000 15 years Straight-line Goodwill 214,970 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 deferred 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 2, Summary of Significant Accounting Policies in the Notes to the Consolidated Financial Statements 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. The acquisition date fair values of major classes of assets acquired and liabilities assumed are as follows: Acquisition Date Fair Value Acquisition Date Useful Life Amortization Method (in thousands) (in years) Current assets $ 540 Amortizable intangible assets Software technology 7,750 5 years Straight-line Client relationships 4,800 11 years Straight-line Goodwill 41,338 Other assets 34 Current liabilities (4,437) Other liabilities (7) Total purchase price $ 50,018 |
Goodwill (Tables)
Goodwill (Tables) | 3 Months Ended |
Nov. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | Changes in the carrying amount of goodwill by segment for the three months ended November 30, 2022 are as follows: (in thousands) Americas EMEA Asia Pacific Total Balance at August 31, 2022 $ 686,412 $ 277,087 $ 2,349 $ 965,848 Foreign currency translations — 8,984 14 8,998 Balance at November 30, 2022 $ 686,412 $ 286,071 $ 2,363 $ 974,846 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Nov. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of identifiable intangible assets | The estimated useful life, gross carrying amounts and accumulated amortization totals related to our identifiable intangible assets are as follows: November 30, 2022 August 31, 2022 (in thousands, except useful lives) Estimated Useful Life (years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount ABA business process 36 $ 1,583,000 $ 32,979 $ 1,550,021 $ 1,583,000 $ 21,986 $ 1,561,014 Client relationships 8 to 26 264,742 59,313 205,429 263,163 55,405 207,758 Software technology 5 to 9 123,584 100,609 22,975 122,363 96,567 25,796 Developed technology 3 to 5 89,081 37,870 51,211 80,956 33,676 47,280 Acquired databases 15 46,000 2,300 43,700 46,000 1,533 44,467 Data content 5 to 20 33,389 26,153 7,236 32,305 24,973 7,332 Trade names 15 6,751 4,340 2,411 6,693 4,431 2,262 Total $ 2,146,547 $ 263,564 $ 1,882,983 $ 2,134,480 $ 238,571 $ 1,895,909 |
Schedule of estimated intangible asset amortization expense | As of November 30, 2022, estimated intangible asset amortization expense for each of the next five years and thereafter are as follows: Fiscal Year (in thousands) Estimated Amortization Expense 2023 (remaining nine months) $ 69,398 2024 82,708 2025 76,216 2026 67,546 2027 62,783 Thereafter 1,524,332 Total $ 1,882,983 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Nov. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of income taxes | The provision for income taxes and effective tax rate are as follows: Three Months Ended November 30, (in thousands) 2022 2021 Income before income taxes $ 157,885 $ 119,930 Provision for income taxes $ 21,087 $ 12,283 Effective tax rate 13.4 % 10.2 % |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Nov. 30, 2022 | |
Leases [Abstract] | |
Schedule of future minimum commitments | 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 November 30, 2022 : (in thousands) Minimum Lease Fiscal Years Ended August 31, 2023 (remaining nine months) $ 28,995 2024 35,424 2025 33,332 2026 32,546 2027 31,694 Thereafter 114,070 Total $ 276,061 Less: Imputed interest 45,127 Present value $ 230,934 |
Schedule of other information related to operating leases | The following table includes the components of our occupancy costs in our Consolidated Statements of Income: Three Months Ended November 30, (in millions) 2022 2021 Operating lease cost (1) $ 8.1 $ 10.5 Variable lease cost (2) $ 4.2 $ 2.9 (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) Variable lease costs include costs that were not fixed at the lease commencement date and are not dependent on an index or rate. These costs were not included in the measurement of lease liabilities and primarily include variable non-lease costs, such as utilities, real estate taxes, insurance and 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: As of November 30, 2022 As of August 31, 2022 Weighted average remaining lease term (in years) 8.4 8.6 Weighted average discount rate (IBR) 4.4 % 4.4 % The following table summarizes supplemental cash flow information related to our operating leases: Three Months Ended November 30, (in millions) 2022 2021 Cash paid for amounts included in the measurement of lease liabilities $ 9.7 $ 11.1 Lease ROU assets obtained in exchange for lease liabilities (1) $ 0.1 $ 1.4 (1) Primarily includes new lease arrangements entered into during the period and contract modifications that extend our lease terms and/or provide additional rights. |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Nov. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of debt obligations | Our total debt obligations as of November 30, 2022 and August 31, 2022 consisted of the following: (in thousands) Issuance Date Contractual November 30, 2022 August 31, 2022 2022 Credit Agreement 2022 Term Facility 3/1/2022 3/1/2025 625,000 750,000 2022 Revolving Facility 3/1/2022 3/1/2027 250,000 250,000 Senior Notes 2027 Notes 3/1/2022 3/1/2027 500,000 500,000 2032 Notes 3/1/2022 3/1/2032 500,000 500,000 Total unamortized discounts and debt issuance costs (15,904) (17,576) Total Long-term debt $ 1,859,096 $ 1,982,424 |
Schedule of annual maturities of debt obligations | As of November 30, 2022, annual maturities on our total debt obligations, based on contract maturity, were as follows: (in thousands) Maturities Fiscal Years Ended August 31, 2023 (remaining nine months) $ — 2024 — 2025 625,000 2026 — 2027 750,000 Thereafter 500,000 Total $ 1,875,000 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Nov. 30, 2022 | |
Equity [Abstract] | |
Share repurchases | Three Months Ended November 30, (in thousands) 2022 2021 Repurchase of common stock under the share repurchase program (1) — (46) Total cost of shares repurchased (1) $ — $ 18,639 Amount authorized for future repurchase under the share repurchase program (2) $ 181,300 $ 181,300 (1) Amounts do not include 25,450 shares and 6,747 shares surrendered by grantees to satisfy withholding tax obligations due upon the vesting or exercise of stock-based awards valued at $10.8 million and $2.9 million during the three months ended November 30, 2022 and November 30, 2021, respectively. |
Schedule of dividends declared | Our Board of Directors declared dividends during the three months ended November 30, 2022 and November 30, 2021 as follows: Year Ended Dividends per Record Date Total $ Amount Payment Date Fiscal 2023 First Quarter $ 0.89 November 30, 2022 $ 34,010 December 15, 2022 Fiscal 2022 First Quarter $ 0.82 November 30, 2021 $ 30,973 December 16, 2021 |
Components of AOCL | The components of AOCL are as follows: (in thousands) November 30, 2022 August 31, 2022 Accumulated unrealized gains (losses) on cash flow hedges, net of tax $ 9,704 $ 3,149 Accumulated foreign currency translation adjustments (102,763) (111,532) Total AOCL $ (93,059) $ (108,383) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Nov. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share | A reconciliation of the weighted average shares outstanding used in the basic and diluted earnings per share ("EPS") computation is as follows: Three Months Ended November 30, (in thousands, except per share data) 2022 2021 Numerator Net income used for calculating basic and diluted income per share $ 136,798 $ 107,647 Denominator Weighted average common shares used in the calculation of basic income per share 38,122 37,678 Common stock equivalents associated with stock-based compensation plan (1) 792 963 Shares used in the calculation of diluted income per share 38,914 38,641 Basic income per share $ 3.59 $ 2.86 Diluted income per share $ 3.52 $ 2.79 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 3 Months Ended |
Nov. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock option activity | Under the FactSet Research Systems Inc. Stock Option and Award Plan, as Amended and Restated (the "LTIP"), we granted the following stock options for the three months ended November 30, 2022 and November 30, 2021, which are valued using the lattice-binomial option-pricing model. As of November 30, 2022, we had 4.2 million stock-based awards available for grant under the LTIP. Three Months Ended November 30, 2022 2021 Stock options granted (1) 267,296 299,702 Weighted average exercise price $ 426.25 $ 434.82 Weighted average grant date fair value $ 125.59 $ 102.40 |
Schedule of assumptions about stock options | We granted 266,051 employee stock options 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 rate 3.99% - 4.51% Expected life (years) 6.62 Expected volatility 24.7% Dividend yield 0.83% Estimated fair value $125.62 Exercise price $426.25 |
Restricted stock awards activity | 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 three months ended November 30, 2022 and November 30, 2021. Three Months Ended November 30, 2022 2021 RSUs Granted (1) 47,038 43,613 PSUs Granted (2) 34,482 30,460 Total Restricted Stock Awards 81,520 74,073 Restricted Stock Awards weighted average grant date fair value $ 415.31 $ 424.14 (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. |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Nov. 30, 2022 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information | The following tables reflect the results of operations of our segments as of November 30, 2022 and November 30, 2021: (in thousands) Americas EMEA Asia Pacific Total For the three months ended November 30, 2022 Revenues $ 323,367 $ 130,738 $ 50,710 $ 504,815 Operating income $ 67,531 $ 67,322 $ 37,042 $ 171,895 Capital expenditures $ 15,754 $ 573 $ 1,633 $ 17,960 (in thousands) Americas EMEA Asia Pacific Total For the three months ended November 30, 2021 Revenues $ 266,913 $ 115,003 $ 42,809 $ 424,725 Operating income $ 55,498 $ 40,654 $ 26,509 $ 122,661 Capital expenditures $ 7,203 $ 110 $ 1,270 $ 8,583 Segment Total Assets The following table reflects the total assets for our segments: (in thousands) November 30, 2022 August 31, 2022 Segment Assets Americas $ 3,214,785 $ 3,191,313 EMEA 518,976 580,450 Asia Pacific 243,779 242,542 Total assets $ 3,977,540 $ 4,014,305 |
Description of Business (Detail
Description of Business (Details) | 3 Months Ended |
Nov. 30, 2022 segment workflow | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of operating segments | 3 |
Number of reportable segments | 3 |
Number of workflows | workflow | 3 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2022 | Aug. 31, 2022 | |
Accounting Policies [Abstract] | ||
Accounts receivable reserve | $ 3,532 | $ 2,776 |
Data costs | Supplier Concentration Risk | Supplier One | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage (more than) | 10% | |
Data costs | Supplier Concentration Risk | Supplier Two | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage (more than) | 10% |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2022 | Nov. 30, 2021 | |
Revenue from External Customer [Line Items] | ||
Total Revenues | $ 504,815 | $ 424,725 |
Americas | ||
Revenue from External Customer [Line Items] | ||
Total Revenues | 323,367 | 266,913 |
EMEA | ||
Revenue from External Customer [Line Items] | ||
Total Revenues | 130,738 | 115,003 |
Asia Pacific | ||
Revenue from External Customer [Line Items] | ||
Total Revenues | $ 50,710 | $ 42,809 |
Fair Value Measures - Schedule
Fair Value Measures - Schedule of Assets and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | Nov. 30, 2022 | Aug. 31, 2022 |
Assets | ||
Derivative instruments | $ 15,410 | $ 12,412 |
Total assets measured at fair value | 258,933 | 224,961 |
Liabilities | ||
Derivative instruments | 2,486 | 8,307 |
Total liabilities measured at fair value | 2,486 | 8,307 |
Mutual funds | ||
Assets | ||
Mutual funds | 32,572 | 33,219 |
Corporate money market funds | ||
Assets | ||
Cash and cash equivalents | 210,951 | 179,330 |
Level 1 | ||
Assets | ||
Derivative instruments | 0 | 0 |
Total assets measured at fair value | 210,951 | 179,330 |
Liabilities | ||
Derivative instruments | 0 | 0 |
Total liabilities measured at fair value | 0 | 0 |
Level 1 | Mutual funds | ||
Assets | ||
Mutual funds | 0 | 0 |
Level 1 | Corporate money market funds | ||
Assets | ||
Cash and cash equivalents | 210,951 | 179,330 |
Level 2 | ||
Assets | ||
Derivative instruments | 15,410 | 12,412 |
Total assets measured at fair value | 47,982 | 45,631 |
Liabilities | ||
Derivative instruments | 2,486 | 8,307 |
Total liabilities measured at fair value | 2,486 | 8,307 |
Level 2 | Mutual funds | ||
Assets | ||
Mutual funds | 32,572 | 33,219 |
Level 2 | Corporate money market funds | ||
Assets | ||
Cash and cash equivalents | $ 0 | $ 0 |
Fair Value Measures - Carrying
Fair Value Measures - Carrying Value and Estimated Carrying Value and Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Nov. 30, 2022 | Aug. 31, 2022 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total unamortized discounts and debt issuance costs | $ (15,904) | $ (17,576) |
Total net carrying value of debt | 1,859,096 | 1,982,424 |
Principal Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 1,875,000 | 2,000,000 |
Principal Amount | Level 1 | Senior Notes | 2027 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 500,000 | 500,000 |
Principal Amount | Level 1 | Senior Notes | 2032 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 500,000 | 500,000 |
Principal Amount | Level 3 | Line of Credit | 2022 Credit Agreement | Term Loan | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 625,000 | 750,000 |
Principal Amount | Level 3 | Line of Credit | 2022 Credit Agreement | Revolving Credit Facility | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 250,000 | 250,000 |
Estimated Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 1,749,236 | 1,908,780 |
Estimated Fair Value | Level 1 | Senior Notes | 2027 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 455,470 | 470,525 |
Estimated Fair Value | Level 1 | Senior Notes | 2032 Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 419,860 | 438,205 |
Estimated Fair Value | Level 3 | Line of Credit | 2022 Credit Agreement | Term Loan | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 627,344 | 750,975 |
Estimated Fair Value | Level 3 | Line of Credit | 2022 Credit Agreement | Revolving Credit Facility | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | $ 246,562 | $ 249,075 |
Derivative Instruments - Narrat
Derivative Instruments - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||||
Nov. 30, 2022 | Mar. 01, 2022 | Nov. 30, 2022 | Aug. 31, 2022 | Mar. 05, 2020 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Net derivative gains to be reclassified | $ 12,100 | ||||
Minimum | |||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Percent of foreign exchange contracts hedged (in percentage) | 25% | ||||
Maximum | |||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Percent of foreign exchange contracts hedged (in percentage) | 75% | ||||
Cash flow hedging | Designated as hedging instrument | |||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Gross notional amount | 658,129 | $ 658,129 | $ 756,846 | ||
Cash flow hedging | Designated as hedging instrument | Interest rate swap agreement | |||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Gross notional amount | $ 500,000 | $ 800,000 | 500,000 | $ 600,000 | $ 287,500 |
Fixed rate | 1.162% | 0.7995% | |||
Benefit on termination of derivative instrument | $ 3,500 | ||||
Notional decline on quarterly basis | $ 100,000 |
Derivative Instruments - Summar
Derivative Instruments - Summary of Gross Notional Values (Details) - Cash flow hedging - Designated as hedging instrument ₱ in Thousands, € in Thousands, ₨ in Thousands, £ in Thousands, $ in Thousands | Nov. 30, 2022 GBP (£) | Nov. 30, 2022 USD ($) | Nov. 30, 2022 EUR (€) | Nov. 30, 2022 INR (₨) | Nov. 30, 2022 PHP (₱) | Aug. 31, 2022 GBP (£) | Aug. 31, 2022 USD ($) | Aug. 31, 2022 EUR (€) | Aug. 31, 2022 INR (₨) | Aug. 31, 2022 PHP (₱) | Mar. 01, 2022 USD ($) | Mar. 05, 2020 USD ($) |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||||||
Gross notional amount | $ 658,129 | $ 756,846 | ||||||||||
Foreign currency forward contracts | ||||||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||||||
Gross notional amount | 158,129 | 156,846 | ||||||||||
British Pound Sterling | ||||||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||||||
Gross notional amount | £ 48,000 | 57,337 | £ 44,200 | 55,567 | ||||||||
Euro | ||||||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||||||
Gross notional amount | 39,892 | € 38,000 | 40,679 | € 37,500 | ||||||||
Indian Rupee | ||||||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||||||
Gross notional amount | 33,600 | ₨ 2,739,827 | 33,600 | ₨ 2,667,928 | ||||||||
Philippine Peso | ||||||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||||||
Gross notional amount | 27,300 | ₱ 1,540,066 | 27,000 | ₱ 1,462,060 | ||||||||
Interest rate swap agreement | ||||||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||||||
Gross notional amount | $ 500,000 | $ 600,000 | $ 800,000 | $ 287,500 |
Derivative Instruments - Summ_2
Derivative Instruments - Summary of Fair Values (Details) - USD ($) $ in Thousands | Nov. 30, 2022 | Aug. 31, 2022 |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative Assets | $ 15,410 | $ 12,412 |
Derivative Liabilities | 2,486 | 8,307 |
Cash flow hedging | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative Assets | 15,410 | 12,412 |
Derivative Liabilities | $ 2,486 | $ 8,307 |
Cash flow hedging | Designated as hedging instrument | Foreign currency forward contracts | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative Assets, location | Prepaid expenses and other current assets | Prepaid expenses and other current assets |
Derivative Assets | $ 2,467 | $ 0 |
Derivative Liabilities, location | Accounts payable and accrued expenses | Accounts payable and accrued expenses |
Derivative Liabilities | $ 2,486 | $ 8,307 |
Cash flow hedging | Designated as hedging instrument | Interest rate swap agreement | Prepaid expenses and other current assets | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative Assets, location | Prepaid expenses and other current assets | Prepaid expenses and other current assets |
Derivative Assets | $ 12,162 | $ 10,621 |
Cash flow hedging | Designated as hedging instrument | Interest rate swap agreement | Other assets | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative Assets, location | Other assets | Other assets |
Derivative Assets | $ 781 | $ 1,791 |
Cash flow hedging | Designated as hedging instrument | Interest rate swap agreement | Accounts payable and accrued expenses | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative Liabilities, location | Accounts payable and accrued expenses | Accounts payable and accrued expenses |
Derivative Liabilities | $ 0 | $ 0 |
Cash flow hedging | Designated as hedging instrument | Interest rate swap agreement | Other liabilities | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Derivative Liabilities, location | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent |
Derivative Liabilities | $ 0 | $ 0 |
Derivative Instruments - Schedu
Derivative Instruments - Schedule of Pre-Tax Effect of Cash Flow Hedging Relationships (Details) - Cash flow hedging - Designated as hedging instrument - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2022 | Nov. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gain (Loss) Recognized in AOCL on Derivatives | $ 6,751 | $ (959) |
Gain (Loss) Reclassified from AOCL into Income | (2,068) | (965) |
Foreign currency forward contracts | SG&A | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gain (Loss) Recognized in AOCL on Derivatives | 3,323 | (3,542) |
Gain (Loss) Reclassified from AOCL into Income | (4,965) | (449) |
Interest rate swap agreement | Interest expense, net | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gain (Loss) Recognized in AOCL on Derivatives | 3,428 | 2,583 |
Gain (Loss) Reclassified from AOCL into Income | $ 2,897 | $ (516) |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||||
Mar. 01, 2022 | Oct. 12, 2021 | Nov. 30, 2022 | Nov. 30, 2021 | Aug. 31, 2022 | |
Business Acquisition [Line Items] | |||||
Purchase price | $ 0 | $ 50,018 | |||
Goodwill | $ 974,846 | $ 965,848 | |||
CUSIP Global Services | |||||
Business Acquisition [Line Items] | |||||
Purchase price | $ 1,932,000 | ||||
Goodwill | $ 214,970 | ||||
Cobalt Software, Inc. | |||||
Business Acquisition [Line Items] | |||||
Purchase price | $ 50,000 | ||||
Goodwill | $ 41,338 |
Acquisitions - Fair values of a
Acquisitions - Fair values of assets acquired and liabilities assumed (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 01, 2022 | Oct. 12, 2021 | Nov. 30, 2022 | Aug. 31, 2022 | |
Business Acquisition [Line Items] | ||||
Goodwill | $ 974,846 | $ 965,848 | ||
ABA business process | ||||
Business Acquisition [Line Items] | ||||
Acquisition date useful life | 36 years | |||
Acquired databases | ||||
Business Acquisition [Line Items] | ||||
Acquisition date useful life | 15 years | |||
CUSIP Global Services | ||||
Business Acquisition [Line Items] | ||||
Current assets | $ 29,728 | |||
Goodwill | 214,970 | |||
Current liabilities | (104,691) | |||
Deferred revenues, long-term | (1,481) | |||
Total purchase price | 1,931,526 | |||
Accounts receivable | 29,500 | |||
Deferred revenues | 99,400 | |||
CUSIP Global Services | ABA business process | ||||
Business Acquisition [Line Items] | ||||
Amortizable intangible assets | $ 1,583,000 | |||
Acquisition date useful life | 36 years | |||
CUSIP Global Services | Client relationships | ||||
Business Acquisition [Line Items] | ||||
Amortizable intangible assets | $ 164,000 | |||
Acquisition date useful life | 26 years | |||
CUSIP Global Services | Acquired databases | ||||
Business Acquisition [Line Items] | ||||
Amortizable intangible assets | $ 46,000 | |||
Acquisition date useful life | 15 years | |||
Cobalt Software, Inc. | ||||
Business Acquisition [Line Items] | ||||
Current assets | $ 540 | |||
Goodwill | 41,338 | |||
Other assets | 34 | |||
Current liabilities | (4,437) | |||
Other liabilities | (7) | |||
Total purchase price | 50,018 | |||
Cobalt Software, Inc. | Client relationships | ||||
Business Acquisition [Line Items] | ||||
Amortizable intangible assets | $ 4,800 | |||
Acquisition date useful life | 11 years | |||
Cobalt Software, Inc. | Software technology | ||||
Business Acquisition [Line Items] | ||||
Amortizable intangible assets | $ 7,750 | |||
Acquisition date useful life | 5 years |
Goodwill (Details)
Goodwill (Details) $ in Thousands | 3 Months Ended |
Nov. 30, 2022 USD ($) | |
Goodwill [Roll Forward] | |
Beginning Balance | $ 965,848 |
Foreign currency translations | 8,998 |
Ending Balance | 974,846 |
Americas | |
Goodwill [Roll Forward] | |
Beginning Balance | 686,412 |
Foreign currency translations | 0 |
Ending Balance | 686,412 |
EMEA | |
Goodwill [Roll Forward] | |
Beginning Balance | 277,087 |
Foreign currency translations | 8,984 |
Ending Balance | 286,071 |
Asia Pacific | |
Goodwill [Roll Forward] | |
Beginning Balance | 2,349 |
Foreign currency translations | 14 |
Ending Balance | $ 2,363 |
Intangible Assets - Identifiabl
Intangible Assets - Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2022 | Aug. 31, 2022 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 2,146,547 | $ 2,134,480 |
Accumulated amortization | 263,564 | 238,571 |
Net carrying amount | $ 1,882,983 | 1,895,909 |
ABA business process | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 36 years | |
Gross carrying amount | $ 1,583,000 | 1,583,000 |
Accumulated amortization | 32,979 | 21,986 |
Net carrying amount | 1,550,021 | 1,561,014 |
Client relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 264,742 | 263,163 |
Accumulated amortization | 59,313 | 55,405 |
Net carrying amount | 205,429 | 207,758 |
Software technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 123,584 | 122,363 |
Accumulated amortization | 100,609 | 96,567 |
Net carrying amount | 22,975 | 25,796 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 89,081 | 80,956 |
Accumulated amortization | 37,870 | 33,676 |
Net carrying amount | $ 51,211 | 47,280 |
Acquired databases | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 15 years | |
Gross carrying amount | $ 46,000 | 46,000 |
Accumulated amortization | 2,300 | 1,533 |
Net carrying amount | 43,700 | 44,467 |
Data content | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 33,389 | 32,305 |
Accumulated amortization | 26,153 | 24,973 |
Net carrying amount | $ 7,236 | 7,332 |
Client relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 15 years | |
Gross carrying amount | $ 6,751 | 6,693 |
Accumulated amortization | 4,340 | 4,431 |
Net carrying amount | $ 2,411 | $ 2,262 |
Minimum | Client relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 8 years | |
Minimum | Software technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 5 years | |
Minimum | Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 3 years | |
Minimum | Data content | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 5 years | |
Maximum | Client relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 26 years | |
Maximum | Software technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 9 years | |
Maximum | Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 5 years | |
Maximum | Data content | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated useful life | 20 years |
Intangible Assets - Narrative (
Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2022 | Nov. 30, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Weighted average useful life | 32 years 9 months 18 days | |
Amortization expense | $ 21.7 | $ 10.1 |
Acquisitions Excluding CGS | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted average useful life | 9 years 6 months |
Intangible Assets - Estimated I
Intangible Assets - Estimated Intangible Asset Amortization Expense (Details) - USD ($) $ in Thousands | Nov. 30, 2022 | Aug. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2023 (remaining nine months) | $ 69,398 | |
2024 | 82,708 | |
2025 | 76,216 | |
2026 | 67,546 | |
2027 | 62,783 | |
Thereafter | 1,524,332 | |
Net carrying amount | $ 1,882,983 | $ 1,895,909 |
Income Taxes - Provision for In
Income Taxes - Provision for Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2022 | Nov. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||
Income before income taxes | $ 157,885 | $ 119,930 |
Provision for income taxes | $ 21,087 | $ 12,283 |
Effective tax rate | 13.40% | 10.20% |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2022 | Nov. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||
Provision for income taxes | $ 21,087 | $ 12,283 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | Nov. 30, 2022 | Aug. 31, 2022 |
Lessee, Lease, Description [Line Items] | ||
ROU assets | $ 154,125 | $ 159,458 |
Lease liabilities | $ 230,934 | |
Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Remaining lease terms | 1 year | |
Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Remaining lease terms | 13 years |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Commitments (Details) $ in Thousands | Nov. 30, 2022 USD ($) |
Leases [Abstract] | |
2023 (remaining nine months) | $ 28,995 |
2024 | 35,424 |
2025 | 33,332 |
2026 | 32,546 |
2027 | 31,694 |
Thereafter | 114,070 |
Total | 276,061 |
Less: Imputed interest | 45,127 |
Present value | $ 230,934 |
Leases - Schedule of Other Info
Leases - Schedule of Other Information Related to Operating Lease (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Nov. 30, 2022 | Nov. 30, 2021 | Aug. 31, 2022 | |
Leases [Abstract] | |||
Operating lease cost | $ 8.1 | $ 10.5 | |
Variable lease cost | $ 4.2 | 2.9 | |
Weighted average remaining lease term (in years) | 8 years 4 months 24 days | 8 years 7 months 6 days | |
Weighted average discount rate (incremental borrowing rate) | 4.40% | 4.40% | |
Lease ROU assets obtained in exchange for lease liabilities | $ 9.7 | 11.1 | |
Lease ROU assets obtained in exchange for lease liabilities | $ 0.1 | $ 1.4 |
Debt - Debt Obligations (Detail
Debt - Debt Obligations (Details) - USD ($) $ in Thousands | Nov. 30, 2022 | Aug. 31, 2022 |
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 1,875,000 | |
Total unamortized discounts and debt issuance costs | (15,904) | $ (17,576) |
Total net carrying value of debt | 1,859,096 | 1,982,424 |
Senior Notes | 2027 Notes | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 500,000 | 500,000 |
Senior Notes | 2032 Notes | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 500,000 | 500,000 |
Term Loan | Line of Credit | 2022 Credit Agreement | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 625,000 | 750,000 |
Revolving Credit Facility | Line of Credit | 2022 Credit Agreement | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 250,000 | $ 250,000 |
Debt - Annual Maturities of Deb
Debt - Annual Maturities of Debt Obligations (Details) $ in Thousands | Nov. 30, 2022 USD ($) |
Debt Disclosure [Abstract] | |
2023 (remaining nine months) | $ 0 |
2024 | 0 |
2025 | 625,000 |
2026 | 0 |
2027 | 750,000 |
Thereafter | 500,000 |
Total net carrying value of debt | $ 1,875,000 |
Debt - Narrative (Details)
Debt - Narrative (Details) | 3 Months Ended | 9 Months Ended | ||||||
Mar. 01, 2022 USD ($) | Nov. 30, 2022 USD ($) | Nov. 30, 2021 USD ($) | Nov. 30, 2022 USD ($) | Aug. 31, 2022 USD ($) | May 31, 2022 USD ($) | Mar. 05, 2020 | Mar. 29, 2019 USD ($) | |
Debt Instrument [Line Items] | ||||||||
Repayments of debt | $ 125,000,000 | $ 0 | ||||||
Interest expense | $ 16,500,000 | $ 1,900,000 | ||||||
Weighted average interest rate | 3.12% | 3.12% | 2.02% | |||||
Interest rate swap agreement | Cash flow hedging | Designated as hedging instrument | ||||||||
Debt Instrument [Line Items] | ||||||||
Fixed rate | 1.162% | 0.7995% | ||||||
Line of Credit | 2019 Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt issuance costs | $ 900,000 | |||||||
Amortization of remaining debt issuance costs | $ 400,000 | |||||||
Line of Credit | 2022 Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt issuance costs | $ 9,500,000 | |||||||
Covenants, required maximum leverage ratio | 4 | 4 | ||||||
Line of Credit | 2022 Credit Agreement | Term SOFR | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.10% | |||||||
Line of Credit | 2022 Credit Agreement | Term SOFR | Interest Rate Margin | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1% | |||||||
Line of Credit | 2022 Credit Agreement | Term SOFR | Credit Spread Adjustment | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 0.10% | |||||||
Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt issuance costs | $ 9,100,000 | |||||||
Discount | $ 2,800,000 | |||||||
Redemption price, percentage | 101% | |||||||
Senior Notes | 2027 Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount | $ 500,000,000 | |||||||
Stated interest rate | 2.90% | |||||||
Senior Notes | 2032 Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount | $ 500,000,000 | |||||||
Stated interest rate | 3.45% | |||||||
Revolving Credit Facility | Line of Credit | 2019 Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | 750,000,000 | |||||||
Borrowed | $ 575,000,000 | |||||||
Revolving Credit Facility | Line of Credit | 2022 Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | $ 500,000,000 | |||||||
Borrowed | 250,000,000 | |||||||
Maximum additional borrowings | 750,000,000 | |||||||
Commitment fee percentage | 0.125% | |||||||
Letter of Credit | Line of Credit | 2022 Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | 100,000,000 | |||||||
Swingline Loan | Line of Credit | 2022 Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | 50,000,000 | |||||||
Term Loan | Line of Credit | 2022 Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount | $ 1,000,000,000 | |||||||
Repayments of debt | $ 125,000,000 | $ 375,000,000 | ||||||
Voluntary prepayments of debt | $ 112,500,000 | $ 350,000,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | Nov. 30, 2022 | Aug. 31, 2022 |
Concentration Risk [Line Items] | ||
Purchase commitment, remaining minimum amount committed | $ 373.9 | |
Letters of credit outstanding | $ 0.5 | 0.5 |
Capital Commitment | ||
Concentration Risk [Line Items] | ||
Capital commitments | $ 1.1 | $ 1.1 |
Stockholders' Equity - Share Re
Stockholders' Equity - Share Repurchases (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2022 | Nov. 30, 2021 | |
Equity [Abstract] | ||
Repurchase of common stock under the share repurchase program (in shares) | 0 | (46,200) |
Repurchases of common stock | $ 0 | $ 18,639 |
Remaining authorized repurchase amount | $ 181,300 | $ 181,300 |
Restricted stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares repurchased from employees (in shares) | 25,450 | 6,747 |
Value of shares repurchased in settlement of employee tax withholding obligations | $ 10,800 | $ 2,900 |
Stockholders' Equity - Dividend
Stockholders' Equity - Dividends (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Nov. 30, 2022 | Nov. 30, 2021 | |
Equity [Abstract] | ||
Dividends per Share of Common Stock (in USD per share) | $ 0.89 | $ 0.82 |
Total Amount | $ 34,010 | $ 30,973 |
Stockholders' Equity - Accumula
Stockholders' Equity - Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | Nov. 30, 2022 | Aug. 31, 2022 | Nov. 30, 2021 | Aug. 31, 2021 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total AOCL | $ 1,474,128 | $ 1,331,408 | $ 1,098,895 | $ 1,016,353 |
Accumulated Other Comprehensive Loss | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total AOCL | (93,059) | (108,383) | $ (57,670) | $ (38,962) |
Accumulated unrealized gains (losses) on cash flow hedges, net of tax | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total AOCL | 9,704 | 3,149 | ||
Accumulated foreign currency translation adjustments | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total AOCL | $ (102,763) | $ (111,532) |
Earnings Per Share - Weighted A
Earnings Per Share - Weighted Average Shares Outstanding (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Nov. 30, 2022 | Nov. 30, 2021 | |
Numerator | ||
Net income used for calculating basic income per share | $ 136,798 | $ 107,647 |
Net income used for calculating diluted income per share | $ 136,798 | $ 107,647 |
Denominator | ||
Weighted average common shares used in the calculation of basic income per share (in shares) | 38,122 | 37,678 |
Common stock equivalents associated with stock-based compensation plans (in shares) | 792 | 963 |
Shares used in calculation of diluted income per share (in shares) | 38,914 | 38,641 |
Basic income per share (in USD per share) | $ 3.59 | $ 2.86 |
Diluted income per share (in USD per share) | $ 3.52 | $ 2.79 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - shares | 3 Months Ended | |
Nov. 30, 2022 | Nov. 30, 2021 | |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 545,510 | 298,900 |
PSUs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 94,162 | 97,511 |
Stock Based Compensation - Stoc
Stock Based Compensation - Stock Option Activity (Details) - Employee - $ / shares | 3 Months Ended | ||
Nov. 01, 2022 | Nov. 30, 2022 | Nov. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options granted (in shares) | 266,051 | 267,296 | 299,702 |
Weighted average exercise price (in USD per share) | $ 426.25 | $ 434.82 | |
Weighted average grant date fair value (in dollars per share) | $ 125.59 | $ 102.40 | |
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average exercise price (in USD per share) | $ 426.25 | ||
Weighted average grant date fair value (in dollars per share) | $ 125.62 | ||
Vesting percentage | 20% | ||
Vesting period | 5 years | ||
Expiration period | 10 years |
Stock Based Compensation - Narr
Stock Based Compensation - Narrative (Details) - USD ($) | 3 Months Ended | ||
Nov. 01, 2022 | Nov. 30, 2022 | Nov. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 12,200,000 | $ 10,400,000 | |
Unrecognized compensation expense related to non-vested equity | $ 153,600,000 | ||
Weighted average period for recognition | 3 years 4 months 24 days | ||
Employee | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares available for grant (in shares) | 4,200,000 | ||
Stock options granted (in shares) | 266,051 | 267,296 | 299,702 |
PSUs | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Payout percentage | 0% | ||
PSUs | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Payout percentage | 150% | ||
ESPP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 700,000 | $ 500,000 | |
Offering period | 3 months | ||
Purchase price percentage | 85% | ||
Maximum employee subscription rate | 10% | ||
Maximum contribution limit | $ 25,000 | ||
Required holding period | 18 months | ||
Capital shares reserved for future issuance (in shares) | 93,853 |
Stock-based Compensation - Weig
Stock-based Compensation - Weighted Average Assumptions (Details) - Employee - $ / shares | 3 Months Ended | ||
Nov. 01, 2022 | Nov. 30, 2022 | Nov. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Estimated fair value (in USD per share) | $ 125.59 | $ 102.40 | |
Weighted average exercise price (in USD per share) | $ 426.25 | $ 434.82 | |
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate, minimum | 3.99% | ||
Risk-free interest rate, maximum | 4.51% | ||
Expected life | 6 years 7 months 13 days | ||
Expected volatility | 24.70% | ||
Dividend yield | 0.83% | ||
Estimated fair value (in USD per share) | $ 125.62 | ||
Weighted average exercise price (in USD per share) | $ 426.25 |
Stock Based Compensation - Rest
Stock Based Compensation - Restricted Stick Awards Activity (Details) - $ / shares | 3 Months Ended | ||
Nov. 01, 2022 | Nov. 30, 2022 | Nov. 30, 2021 | |
Restricted stock units and performance-based awards | Employee | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | 81,520 | 74,073 | |
Weighted average grant date fair value (in USD per share) | $ 415.31 | $ 424.14 | |
RSUs | Employee | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | 47,038 | 43,613 | |
Vesting percentage | 20% | ||
Vesting period | 5 years | ||
PSUs | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Payout percentage | 0% | ||
PSUs | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Payout percentage | 150% | ||
PSUs | Employee | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | 34,482 | 30,460 | |
Vesting period | 3 years |
Segment Information - Narrative
Segment Information - Narrative (Details) | 3 Months Ended |
Nov. 30, 2022 segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Number of operating segments | 3 |
Segment Information - Results o
Segment Information - Results of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Nov. 30, 2022 | Nov. 30, 2021 | Aug. 31, 2022 | |
Revenues | $ 504,815 | $ 424,725 | |
Operating income | 171,895 | 122,661 | |
Capital expenditures | 17,960 | 8,583 | |
Assets | 3,977,540 | $ 4,014,305 | |
Americas | |||
Revenues | 323,367 | 266,913 | |
Operating income | 67,531 | 55,498 | |
Capital expenditures | 15,754 | 7,203 | |
Assets | 3,214,785 | 3,191,313 | |
EMEA | |||
Revenues | 130,738 | 115,003 | |
Operating income | 67,322 | 40,654 | |
Capital expenditures | 573 | 110 | |
Assets | 518,976 | 580,450 | |
Asia Pacific | |||
Revenues | 50,710 | 42,809 | |
Operating income | 37,042 | 26,509 | |
Capital expenditures | 1,633 | $ 1,270 | |
Assets | $ 243,779 | $ 242,542 |