EFX - Earnings call transcript Q4 2024

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Operator

Greetings, and welcome to the Equifax Inc. Fourth Quarter 2024 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce Trevor Burns, Senior Vice President, Head of Corporate Investor Relations.

Trevor, you may now begin.

Trevor Burns

morning. good and Thanks, conference today's call. to Welcome I'm Trevor Burns. today John Gamble, me are Mark and Officer; Executive Chief Chief Begor, With Financial Officer. Today's the of and later at call archived recording website. Relations will recorded is be our Investor today IR & News in section Calendar Events tab being available

the will IR & News reference Events at our be During to can it the materials, call, section found be of we website. also in making certain the Presentations tab

cause making earnings materials to filings statements, certain of are XX-K and and we're and including also These call. These number our may differ full results Form impact to our with help guidance involve our environment. statements are XXXX Equifax factors filings. uncertainties forward-looking could XXXX first XXXX conference materially and forth set XQ understand quarter its the that including factors business risks, business a Also, other SEC, labeled in year you actual expectations. that subsequent from Certain risk

to items We certain EPS, which are for measures can will adjusted operational section also financial be our non-GAAP comparability Info of tables, our will included Financial which detailed and in earnings be Financial release These our underlying be with cash the IR certain reconciliation at non-GAAP in EBITDA of and adjusted performance. measures, tab affect found are conversion, the adjusted that Results including the financial website. referring

shortening of prepared on many April, first feedback you, based will call As from remarks. we our with note, on starting in a quarter plan our

included in quarterly to we normally share Some the earnings of may our in that appendix the be prepared the presentations. content

to or with comments, If and them you share me have please feel [indiscernible]. questions free any

Mark. turn like I'd it to Now to over

Mark Begor

results for to quarter, our Before performance. XXXX spend a I want few minutes on cover I our the

mortgage almost at XX% set up up revenue constant macros. with the of X% challenging pleased were currency basis against was X% year was and We the framework. and we some goals last hiring X.X% that over to XXXX line $X.XX in X. share, XXXX reported financial year. growth our EPS the end organic low long-term Slide the to beginning Adjusted on at versus was a our per in performance with Turning of

conversion XX%, free over principally with planned our cash year XX% constant Cash our of mortgage target XX%, at dollar of under reduced of million, revenue X at target in in XX% and leverage headwinds up half turns. accelerated growth not we approaching EBITDA delivered was at given hiring the to and although market U.S. plus and almost We levels $XXX flow had debt of improvement we levels the XX% second the margins in the market. our

accomplishment We and customer strategic Cloud, accelerate our Equifax their completed was us cash now performance aligned sets our and free in We to to Equifax strategic huge American as was -- well investment. drive of shareholders is growth X XXXX growth up our new consumer an for which their migrations, cloud EFX in our completing Canada, return milestone cloud point of cloud our USIS, after program revenue EFX the made acquisitions, dividend XXXX. towards Equifax. a through big priorities inflection strong, in We Chile repurchase Latin countries that purchase Equifax important share ability have several share data bolt-on XXXX with to generation and to capital flow through XX% years a close targeted technology multiyear while against launching delivered to positioning a priorities. other and both progress Overall strong Spain, XXXX transformation

AI. on from competitive that the focus and products growth, will XXXX allow to significant we beyond as advantage and building a us leveraging pivot have fully in to Equifax innovation, to expect new We cloud

using XXXX. In decommission Our XXXX, last centers XX% FX.ai. and AI about machine our with were additions, records XX% learning, XX deliver in new year Equifax data with on offense year outstanding models had XX% million EWS allowed of in built systems increased that team are records twin the In about and active spending of with new records, in XXXX. and from now Cloud, the in cloud total the up to data reductions scores million $XXX us XXX up million record the legacy set. year $XXX progress to Leveraging million and Equifax and ending another or million XXXX, we XXX

which expect new vitality strategic index in And product Services our XX% strong including equates last million Verification partnerships was continued with of revenue EWS revenue basis fuel we about XXXX The $XXX XXXX, growth growth XXXX in beyond. which our above XX%, we long-term points of new team new XXX will broad-based and to goal XX year. product Workday, signed and

Vitality Our were basis Index strengthened second to importantly, XXX we of USIS Vitality half and first the points Index half last And year. in EWS from saw the very International strong.

we XXXX our above can again Vitality Equifax Equifax provide. be to deliver expect in XX% We that the cloud long-term as only leverage of goal to Index our new products

new move AI we energized Equifax innovation cloud. by our product, I'm into commercial new and capabilities and XXXX, benefits of the As momentum, the

our impacting dollar $X.XXX reported million substantially revenue up the quarter, Turning was strengthened guidance. $XX quarter revenue X, billion negatively to Slide The X%. versus October about Equifax fourth of in

of The On driving about being versus principally last or quarter our in an and of dollar constant currency the guidance expectations. midpoint. weakness quarter. and organic X% impacted non-mortgage of the onboarding our in talent just mortgage revenue weaker below over growth weaker the This markets, midpoint constant weaker $XX the than markets U.S. businesses driven in X% points declined XXX fourth points framework growth million was of hiring resulted basis, XXX the which our October by the basis just basis our bulk under U.S. half hiring and revenue significantly

the inquiries in January as XX% also revenue up have moved U.S. to revenue rates these expect was credit quarter X%. above revenue we trends, late in the declined and expectations. our mortgage below U.S. Based on XXXX December Total in mortgage pressure be and meaningfully mortgage macros, about adjusted mortgage XX.X% from fourth of XX% quarter with of sequentially, Despite delivered adjusted XXXX. mortgage and EBITDA $XX EBITDA up margin was Equifax million line in down which our hiring with $XXX million, weaker framework. October

over EPS And midpoint guidance at quarter first the our the Adjusted and was in EBITDA $X.XX first XXXX. second of adjusted for revenue quarter share the declines history mortgage of adjusted this is Equifax the of EPS October big fourth future. million, revenue of per quarter milestone was We a of disappointed that we given the hiring for over in share the since quarter below quarter. the October late and were a guidance $X $XXX were

in and in and expenses commitments both long-term framework. have managing on adjusted well change the However, delivering on growth team on to and no and EBITDA our on our focused costs deliver our remain commitments EPS. performed We Equifax

Turning and And declining weakened Solutions market. up and to revenue in trends we October, was guidance, hiring quarter below monthly volume quarter. data markets, in talent I-X records, penetration outperform Solutions as in new benefiting October and January, in their the saw solutions due as In weakening Talent Slide X. macro, as incarceration, which X% includes products, the well education lower-than-expected the continues the and new Workforce to Talent licensing solutions X% well employment a and Solutions new onboarding our the underlying lower discussed was that principally weaker fourth hiring up trended we total of quarter. during meaningfully volumes December from revenue data. new off as from further in hiring hiring from VERIFI to the weaker revenue the pricing levels. data Despite hub credentialing

by quarter. in about XX% sales volumes. with inquiries lower last expectations mortgage up growth another points revenue up than X%. growth strong rates was we in quarter expected, strong fourth saw Insights had redetermination quarter very in principally from to momentum as basis fourth Government fourth the outperformed in comping the twin inquiries and quarter the revenue up growth strong with revenue mortgage in XX% XX% data continued saw were quarter, with year strong the total We third ucarceration from quarter, digits. off XXX our due consistent double EWS record the twin revenue up up with sequentially EWS

and despite points tightly EBITDA The I expect referenced as revenue Services of strong in basis adjusted market hiring has revenue guidance down the hiring EWS while and growth. earlier, our and were And it was X% driving quarter continues quarter. to top Solutions also The line we continued the weaker the market impact January, consistent XX negatively Workforce on performance. focused Employer first growth. revenue. staying weak impacted onboarding I-X manage in with to up XX.X% costs team a margins weaker-than-expected

the up record and partnerships the new to Twin to in quarter again or agreements fourth the million $X X. records. quarter XXX X strategic the fourth in Slide active with to Turning the total continue to million quarter, XXXX which new signed strong XX% partners, year very with records XX. EWS be brings for In in additions million $XX

plenty along with active these million database we Workday new the million Americans. of in of partnership expect XXX in drive income-producing the growth record unique our XXX have EWS twin to towards growth We new partnerships, records, TAM At XXXX. to room grow about revenue

slightly and the the an outperformance, consistent we sequentially to FI, driven by principally X. our other year, guidance off saw quarter, in growth strong quarter our with data low rates over declined almost mortgage but bureaus. non-mortgage management was Within the the quarter was principally in a business, fraud fourth well grew guidance. moved was trend revenue above up quarter, growth USIS and flat and and above in a our declined Turning in sell return in quarter, was business. segment improving the mid-single-digit Mortgage our auto identity to revenue a the X% revenue were we X%. of inquiries and which very credit the long-term comping strong very USIS growth below them X.X% we framework in in to growth revenue single-digit quarter XX%, saw up to Slide was as we and USIS declines online, in direct-to-consumer last in December mortgage XX% the late weaken Telco meaningfully strong which saw chargeback where during USIS from credit X%.

businesses USIS segment. prequalification in revenue with total and was In quarter the USIS growth growth. BXB the strength Payments revenue The preapproval products environment, fourth We over preinquiries in line and our drove just and quarter. mortgage in with in about Marketing our in $XXX with mortgage our strong expanding XX% preapproval identity-based of sequentially. the the our At revenue mortgage along quarter, about Services, was saw flat Financial and offline guidance. in October relationships business declined the mortgage million, pricing

data acquisition comping down strong quarter, wealth business strong trends. our delivering strong in fourth USIS with the margins and very cloud XX.X% XXXX. USIS EBITDA consumer, quarter the performed customer legacy consumer was IXI USIS in platforms. Solutions they technology basis revenue a adjusted up quarter, Our in up in points another strong channel well direct the quarter Consumer XXX as with telco our sequentially decommissioned utility reductions guidance. and very extremely DXC consistent expected cost from against in and had growth X% were

With consumer well complete, telco is is in our beyond. the USIS XXXX cloud growth and and team for the utilities transformation USIS and positioned

October of was and up our strong X. guidance. higher which sequentially Australia the economic XXX X% XX% weaker in the was and conditions. sequentially and stronger very X% constant adjusted points in since good Canada rates sequentially American revenue Slide driven and and delivered double-digit revenue Europe in growth and in framework were quarter, strong growth revenue EBITDA by to was currency and our growth International U.K. U.K. CRA, digits from Latin the to overall fourth stronger guidance, grew the long-term Brazil, quarter up growth their mid-single than than margins above highest reflecting section. of International October Turning cost XX.X% strong, basis fourth a XXXX

Turning XX. to Slide

the in progress double-digit to make products, our very businesses. from quarter fourth a XX% delivering continue innovation, strong broad-based new We performances of across all vitality driving

assets. and our Vitality Equifax XXXX, and in telco using strong solutions our income along rollouts market double-digit expect rapidly credit data We capabilities With goal, differentiated and and are drive leveraging include data bringing unique our migrations USIS Index USIS Equifax capabilities. that above our complete, to XX% again efx.ai twin cloud long-term to and with consumer we developing our data our new employment customer alternative product

is and our twin consumers solutions expect our a help credit We indicators, big to credit clients, deeper powered consumer gain our Equifax. income twin insights employment solutions win clients which for both and creditworthiness using into and from for

and that This solution the and instantly applicants twin Equifax Equifax, a solutions mortgage lenders a both verifications vertical huge additional information Equifax We're auto information key both from allows credit report. creditworthiness cloud the obtain in rolling our XXXX data with unique income provides differentiator request with mortgage credit single plan USIS employment underwriting. are to of solution leveraging data fabric. and the to in along employment out assets about EWS only to Equifax the status new power where a a We launch lenders income single that the for and are applicants new credit integral data

XXXX that Equifax strategic growth. drive our our as a continued Slide for well to free strong flow CapEx down our executing and to XX. is to priorities leveraging new Equifax will we're growth, cloud Moving EBITDA cash deliver ability Equifax AI-powered in comes against top product year our expands. XXXX our and positioned We generation line well enter pivotal XXXX, new accelerate

and Our flow a that long-term will our shareholders both capital strong program repurchase approach to our free dividend share growing multiyear launching through conversion XX% goal return leverage XXXX. in Equifax expanding positions cash EBITDA to our and

year. With to markets have our continuing guidance inquiries end inquiries mortgage we declines on Based U.S. hard the the to hiring. -- X%, USIS credit trends, compared in over are challenging mortgage weeks. XX% those in meaningful rates hard in U.S. reflects face above and X past seen declining last We XXXX mortgage

inquiry twin and in rates as current We not revenue forecasts. we increases will include or of and decreases our mortgage credit rate the interest past, in run continue do our EFX to forecast

strengthened below of be about past revenue USIS based on XXXX. X XX% at expect last, XXXX with order the average X in million. hiring points rates, the the on we dollar the perspective, and in to over disclosed U.S. to or years. $XX mortgage XXXX For by that negatively hires over hard impacted revenue relative And and X% over credit be over we about the represent inquiries about the months U.S. basis FX total weak BLS XX% hiring last quarterly Also, of XX over weeks, significantly will trends USIS down current XXX XXXX past

mortgage Constant The the revenue Based on we economic of up to on expect our XXXX. of the up midpoint weak and level, of hiring revenue non-mortgage about X.X% to long-term up revenue Workforce is Absent the in and to U.S. the to our unit hiring assumptions, and revenue points. -- X% be rate about deliver Solutions to At basis $X.XX basis long-term growth declines, of X% declines mortgage with [indiscernible] currency at be framework over is impacting mortgage framework assumed these expected to growth revenue XXXX about markets both a X% XX%. XXXX. and lower expect in than and billion, by Verification XXXX the X% would due Services mortgage growth deliver reported guidance. markets. over organic revenue growth growth market at of business framework a currency these midpoint in our are expected constant hiring we about XXX constant be X% our overall organic

service practices. from double-digit revenue X%, second the tough some the should expected half XXXX, is growth food expected in up U.S. Verifier hiring the talent to to of first states impacted XXXX and funding X% to in the growth U.S. in revenue expected principally -- over and growth levels to weakness Non-mortgage about nutrition growth be market. down the the XXXX mid-single-digit Mortgage adjust driven CMS due in to government mortgage be up in ops as the expected in and revenue decline Government and expected was by resulting seen of return due expected levels be comps decline USDA XXXX. modified to our to business. half is the of impact

goal our growth market and drive and both Verification and Services will despite Continued market XX% to strong of over index a continue twin hiring record Equifax growth in mortgage the continued vitality headwinds. penetration and growth, revenue pricing

with about flat by Employer XXXX We to in also be growth and declines U.S. the impacted expected expect onboarding. hiring in Services

to deliver $X X% about XXXX, revenue which revenue expect growth USIS billion. We over to in USIS bring would

We in XX% mortgage inquiries. grow expected the revenue expect despite decline hard mortgage X% to credit over

growth last expected up we should grow constant in margins midpoint is their X% guidance, to basis revenue cloud. expect and USIS currency growth the $X.X levels EBITDA as X% expected consistent over revenue new Non-mortgage about At about to the X% billion. be from XXXX, NPIs year Equifax X%, our XX leverage and revenue about X% And is framework. share international long-term from accelerating to revenue at gains EBITDA to benefit points increase X% of with about with to and these increasing financial they

midpoint guidance $X.XX cash EPS X.X turns, through the flow $XXX acquisition XX%. flow expected capital to we program the repurchase long-term of at a up during and With target our last bolt-on of now multi-share and our Adjusted share, return positioned per year to about XXXX. cash of be growing is continue below at million increasing free both over our are well X% conversion free our leverage to start at dividend shareholders about the strategy in with

it to and to detail to our I'd also more John provide guidance turn XXXX Now framework. first on quarter over provide assumptions like our and

John Gamble

Thanks, Mark.

normal as As which for 'XX credit in assumes seasonality that on are USIS Mark shown mortgage Sequentially, our assuming in of mortgage are XXXX, Slide of revenue. and mortgage have planning XX% we XXXX, all XX, XX% discussed USIS hard XQ business represented over XX% inquiries in about XXXX. our and will down again, U.S.

impacted The markets negative XXXX well mortgage in specifics Slide full adjusted as FX. XXXX of markets growth and revenue over impacting declines in year-to-year U.S. by growth XXX be year as XX by points is market declines the about points. approaching significantly percentage XXX these growth to guidance. our would EPS Absent are being provides points factors, basis XX%. these and would by adjusted framework long-term margins basis our about EBITDA Equifax be adjusted EPS X% growth with X currency our XX% revenue consistent hiring and by constant

on expected as basis includes guidance our EBITDA to we EBITDA specific BU well XX about basis factors discussed. are line Equifax adjusted items. market Slide which margins due long-term up as also in XXXX, in P&L margins Principally, additional our growth XX XX the improvement to points be detail on just due annual long-term below also points to framework framework. is below of being expected revenue

about The as legacy well referenced Twin costs, up benefits Partners. levels to actions the in from offsetting as are boarding delivered XX.X% full again, systems in costs revenue related in of margins reductions lower the than XX.X%, impacted margins, are USIS in are growth from decommissioning the benefiting Mark cost Margins in particularly more and EBITDA of impact mortgage. than particularly USIS cost of mix EWS expected about higher basis XXXX. XXXX EBITDA more mortgage. are by at the offsetting points revenue year-to-year, realizing XXXX to benefit margins XX.X% be about down XXX the higher from addition year costs,

return XXXX International EBITDA expected technology, corporate XX.XX% from to as And other XXXX. million increase target increased excluding incentive relative payouts is about XXXX compliance. estimated from into XX.X% about we U.S. XXX variable expand and is North levels points compensation impact due and to benefiting systems. growth XXXX put rate due as investments in and spending. amortization systems principally increased of decommissioning and we expected as tax margins XXXX about credits XXXX, our Corporate expense, American Depreciation $XX to cloud-native security we in and above amortization, be in development principally reduce capital and legacy as of overseas depreciation in continued and in well are XXXX to significant to to basis at tax taxes expected is by to lower about as actions increasing related cost revenue XXXX to production

of innovation million revenue building $XXX that about the driving complete in adjusted both million down spending centered of and guidance be And our believe we should our infrastructure. XXXX, $XXX cloud, XXXX. EPS versus We will midpoint spending be revenue our more our to as is capital growth dedicated in ranges. guidance from at Capital the

$X.XXX versus 'XX, X%. of be Slide year-to-year expect billion X% revenue we billion, on XX guidance. dollar share EPS amortization XQ about $XX adjusted share expected per to EPS almost XQ adjusted be growth reported per growth total in reducing a 'XX decline tax midpoint. 'XX 'XX, a principally million of up 'XX about the to provides X% details constant to $X.XX $X.XX in the in XQ -- at our a midpoint of at the and at higher $X.XX is between $X.XX higher XQ down XQ revenue share, driven the Equifax In about the or about by EPS is $X.XXX The basis by depreciation midpoint share. and $X.XX Adjusted is effective rate and

is points Equifax about are margins our year-to-year. higher performance quarter adjusted in decline basis of expected Business EBITDA and reflect about quarter first unit quarter margins sequential first to XQ the fourth seasonally adjusted equity the EBITDA revenue higher XX be in The guidance, Mortgage compensation. XX.X% down 'XX and at mortgage is growth midpoint expected be be X% pricing expected continued Verification up X.X%. to revenue the Services decline. market flat offset expected is be Solutions records growth be about Workforce year-to-year. revenue up to follows: by revenue in expected to about to as expected with is

return should first adjust the nutrition double-digit as half Government of. about Verifier is flat revenue Government XXXX revenue second X.X%. be difficult modified Mark is to XQ USDA expected CMS as states of food half funding CMS revenue a volumes. to up the And some in and versus be levels redetermination to expected weakness service comp practices. about and to indicated, 'XX growth in nonmortgage with

EWS year-to-year. reflecting about be USIS and to revenue impacts basis the about adjusted about revenue margins X% declines expected is U.S. is growth XXX from Talent expected revenue revenue was nonmortgage as be hiring. contributors. up mid-single digits. is vendor by margins impacted in and declines Adjusted mid-single about third-party inquiries, up up expected principally Employer actions. by due are XX%, to again, Mortgage about growth constant record expected by XQ up boarding decommissioned currency. telco XX% revenue EBITDA consumer expected benefits EBITDA should digits cost X% expected about expected are impacted and to about hard offset is to 'XX. pricing to growth be down to in be down is to the legacy be points in to being revenue be significant up lower points systems. is International be flat expected XXX X.X%. are more USIS from which at X% expected up to in Mortgage and be being revenue utility Adjusted USIS be EBITDA basis margins than are year-to-year

is and cash to approach conversion to goal Slide our expected Free in about to to XX. continue $XXX Turning XX% million cash strengthen flow XXXX.

capital ratings, as significant to As with credit both we to targeted long-term and flexibility have return BBB, and levels goals shareholders. have restart BaaX Mark indicated, bolt-on our increase we consistent reached leverage acquisitions

Turning XX. credit our levels. in to XX% its is market over hard average assumed inquiry Slide historic XXXX below guidance The U.S. mortgage

this norms the the order average market mortgage of that margins, would growth and billion opportunity deliver in toward mix that beyond. and would recovers recovers move our current EPS adjusted P&L normal mortgage and records, represents levels the As million above for market EBITDA At current current Equifax. as expect $X the per you of $XXX past, mortgage that we share, its with and discussed toward historic mortgage in annual revenue TWN into adjusted we and $X.X to and XXXX pricing on at the respectively, have

back turn Now Mark. to I'd to like over it

Andrew Nicholas

John. Thanks,

$X.X and challenging weakness, market flow Slide in margin EBITDA million reflects of in $XXX to cash expectation expansion expect XX basis free XX%. below XXXX, guidance cash will X% points of by end over deliver financial from Despite adjusted of of about and currency markets about conversion long-term constant resulting billion, to In driven be U.S. we this that mortgage our Turning at our the XX. both framework. revenue our hiring,

year end in X% long-term confident expanding above As on at XX% growth points continue deliver EBITDA ability our markets we are executing organic per our to cash strategy. XX%, at growing our normalize, conversion basis margins bolt-on in revenue to XX range, M&A and while

we we reported the XXXX, up of that strategic and set was a our an to up goals Wrapping X% in XX%. significantly free at with EFX per Equifax $XXX at EPS the year up line share, revenue against financial delivered capital on had X.X%, million in performance shareholders. almost with challenging of in currency on cash basis constant And and of strong return XXXX, execution increase Slide conversion of in to organic expect we on Adjusted beginning XX, a cash priorities And $X.XX economic in basis. the XXXX flow XXXX environment.

XX% in portions of We the with delivered on global Equifax now revenue significant the well as critical American to priority Equifax completing close markets of our cloud. of North our consumer cloud transformation new as

and native innovation, new resources transmission Equifax growth. leveraging for advantages Our industry-leading to Equifax and cloud and importantly, from cloud speeds customers product competitive in and for pivoting security stability, building of already the our are DNA providing is data always-on infrastructure products faster technology,

growth ignite platform using new credit We lead single data analytics solutions powered efx.ai by like and we USIS our to are indicators for twin and our gains expect which that fabric, mortgage develop can business. in share to only our deliver, and Equifax verticals will auto

to growth. also can revenue cash we return position Exiting flow to to on shareholders point an milestone fully for XX% inflection our the with huge Equifax strong flow team in to cash our focus accelerating is substantial sheet XXXX We're free with of our Equifax free balance at important a new so environment XXXX. excess cloud in a close and

of our future entering we but transformation substantially are next by our new the chapter the even energized Equifax more complete. about enter cloud momentum the I'm energized with XXXX, Equifax. We as of

it me And open operator, questions. up with let for that,

Operator

Instructions] [Operator will Jeff from question our coming be of And first the line with Baird. Meuler

Jeffrey Meuler

I I'm get listen reconcile me for decremental factors still volumes contracting but you're and hard year-over-year associated to impacting on with margins EWS that. saying that growth. that margin guidance, trying on And margin to X% So there's a everything it's macro are there's revenue

also year. you've that a for would I including onboarding while, called but costs think You out last had there's that new for partners,

just and partners, and TWN So in for if renew. of specifically on terms on factors other payout sign both any you what's new you hit can Record ratios as going

Mark Begor

Yes, John in. start jump Jeff, I'll and can

the factors Clearly, it in the larger as hit you was and EWS now well of market of than talent prior think XXXX. on the I mortgage takes forecast high-calorie a impacting in the decline is revenue lot same out Equifax side. the as years. Onboarding

know, we million added last X the XX XX records we including partners, quarter. you fourth year, but As in added

highest our year. additions record partner year last last had we've and addition our So highest

So onboarding, benefit us onboarding forward. future costs, larger be expect do will to which, in we the moving XXXX, course, of those in

John, add? would you else, What

John Gamble

Yes.

So nice products growth. margins. and that seen we high we very a and about continue talked lower in to We has in margins TWN very, also insights. drive have seen growth nice that those want some products. growth. margins than obviously to have We've But education contribution variable

that that in deliver revenue somewhat And new growth margins So fact we're to And degree. in bit obviously year. margin future investments make decremental a continuing EWS the to to products. drive to is pressuring a that substantial given and is lower, the is growth

this believe about, plus return just margin in we resulting So to overall, hiring But very is market recoveries, we're the markets strong growth. think decline the 'XX. still the the expect We headwinds and we the to business. going talked of in a to I be factors difficult mortgage margin as

Jeffrey Meuler

you're... that But on just Okay. payout the ratios

Mark Begor

No change. Jeff. sorry, Yes,

We Sorry, one. extended cover have I about change There's no in we didn't our payout -- partners. change. No ratios. XX that it

in same a year, No payouts what terms our as was those are. past. that there the change last in think extended of I handful

of attractive it a so impacting payout but margins a of lot do We we, value at those not see partnerships lot all. have They partners. our get we That's change on with and in ratios. no

Operator

the next Barclays. Our question Patnaik Manav with of from is line

Manav Patnaik

quantify would wanted and I know headwinds, EPS how markets you those XXX guess, be wanted Mark, to the confirm, hiring the been points to basis would what is And said flat. that just growth of assuming without that be. impact when then I have you I would mortgage higher, just that would

Mark Begor

going we points quarter comments you what I market were was And is forward talked be gave at time on X know, some happening in decline you obviously, At that happened to rolled that we the and about when Manav, in that up based trends us. thought our about think time, trends. to And the we that back we current mortgage as was to mid-December and XXXX. surprising Yes. earnings, speak, third October as around

weeks. expected But decline the lot sharper Obviously, was X% rates X mortgage are high. than a the last we over

the at comparing environment, So a and looking somewhere not really when X high between were as that it an XXXX and ago, months very is positive because to have we that market think impact recently standpoint, being mortgage flat it's it's X what we about had as calories. From up now. we're slightly would EPS

John Gamble

a just So flat Manav, use to obviously, would to just just recovery those when again the EPS, market. we really to rate flat assumed the variable growth relative benefit have is products. we on margins we we And the calculated that recovery a market.

USIS then we flat, and would down TWN we flowed go flat just inquiries to would through a assumed we being for opposed so market hiring both X And and be and variable margins. assumed as mortgage, the to

Manav Patnaik

Got on And seeing And are with what's government there? it. and of cadence there? that's going impacts on [indiscernible] you any Mark, help side, been in the then early terms that that stuff just just on out all thrown us Okay. maybe again

Mark Begor

Yes.

and fourth quarter think the I on So maybe you're focused XXXX.

exceptionally you performing growth rates. know, been well, as have We very high with

So and used CMS XXX% impact the where did now the states states first mention some into in change have with states the that the and that. in fourth quarter. reimburse in quarter that are first the in you're pay of reimbursement in program in XX%, a They're data We CMS to including costs. at reimbursed [ in had some so XX likely ]. XXXX, adjusting getting particular, That as to the made they then comps fourth hard to the

states got And working for the costs As half their our them you if of on the solutions with in have their cases, going that to to, some in on with the government first year some impact business. focused to direct our have start data budgets. budgeting states themselves, and statements, going know, to some operating they've and of they're adjust that we're paying

second As expect half. growth the to said, we to double-digit John the return government in business

in signed into that XXXX. comes extension last we may contract SSA large really remember, You in a with September year, effect

impact, the have effect positively when escalators contracts into they larger government the a have on in that But contracts have will pricing have year. impacting then some that during particularly we that positive So our second half. half. second the And are that go uniform escalators aren't

we good another get as John? Anything year. the guy else, that's into So

John Gamble

dealing mentioned It's quarter. in we're there And the the fact quarter last Mark first year that still were in the redeterminations part in second of the of half. first with

the and the was strong second in quarter XXXX. revenue first quarter into So XXXX of moving very

Operator

question of is JPMorgan. the line with next Andrew from Steinerman Our

Andrew Steinerman

quick I have ones X on mortgage.

John, down the a first were you And just what last . us could X one revenues not you has U.S. from a just quarter one definition percentage has hard we application the measuring stated, as of revenues? second to hard mortgage reports. The soft is, which increase, is on seeing MBA been reported And different fourth you're versus I'm what just credit mortgage, tell get sure, of the as weekly mortgage maybe if Equifax weeks, really. a difference I know wanted their things, just that's sure

John Gamble

on time level So about we and purchased time good the highest XXXX in at in have over file what's be data to was that the over loan. early XX-plus the a time probably look we've with order you that file historically, And include of we're right? a your required XX inquiries that's something credit So XX%. hard to or through, pre-approval disclosed that XX.X%. average we origination XQ if It close because the on inquiries credit number. we look is that's down correlation period, time we taken been think Andrew, consistently 'XX has that and think Tri-Merge originations, that inquiries, pre-qual XX%. And right? quite And we've originations a a right? for know actually so And this, not And what's disclosing of XX years, same doesn't period the impact down to to inquiries, relative you product, soft focus at hard in inquiries the hard

and number that's good, specifically. quite we continue seems disclose correlation why to that the So

Operator

Kaplan Our next Stanley. line the Toni question is Morgan with from of

Toni Kaplan

first Maybe X%. on of versus just up USIS, X% last non-mortgage growth quarter

hear of conditions mortgage sort those factors the to overall that in environment to mentioned broad wanted but just And hiring, you've on obviously, or you're selling market of be anything would seeing. about the Just share you wanted and of X sort any changes any outside helpful.

John Gamble

in performed well, generally speaking, I think It's indicated We low relatively also fourth we is quarter. performed right, No. auto digits, right, FI what we the single thought well. thought relatively

biggest was a digits. the selling in saw, FMS you was third the the drove great relationships about in We new some difference team industry. in double which into that right, think quarter the up we quarter, FMS the new I that strong. job customers third talked outstanding some that very did built The fact payment

FMS drove really in business. our really that growth or good batch of Some

well, quarter. first feel the biggest terms auto the difference performed the performance DXC actually again, low single we probably was little of delivered FI insurance. the low quarter growth in saw that time single So think to in actually in a we back third quite bit and But like online, for fourth came time, digits, and was I relatively of in what between digits. some

The say online difference FMS. the was big I'd So relatively performance consistent.

Toni Kaplan

I about the opportunity. on Great. ask a you've lot did my spoke about follow-up, trajectory. And then the government to know I want

So for that. thank giving you

opportunity you you of guess programs, their Just you can by I that thinking and a basically getting CMS cut. of How as programs, potentially the -- are the is about feel general, government them. about more and with in but be new some the but offset programs and like some success are -- when think that point I government could had programs efficiency like there sort for you rethinking to lot provide

how you environment? the sell opportunity in just How do about just So that more broadly? thinking are into you change

Mark Begor

great qualify. White accurately Yes. in think means focusing on abuse or focus in to where really the people all more help are a Tony. be perhaps -- around we in suspect Washington, on focus quite of really social market I delivery opportunity. benefits social and services system, is which And big seen in how House And will and even be the see delivering studies can There in working still think read all It's improper a We broadly both our is, yours, and administration, cut. bit a Hill and that I says the payments and towards receiving there's a those we're that there's of around too, that this that services need the there's view that. it's accurately. we've a our don't to the social going on also and services is aren't question, there programs focus,

for know know is about of the that's, verifications a billion macro government $X us I So space. that we manual for in Equifax done think, that you are positive TAM

the at state level. done again, And it's

We a manual. agencies you state have know, a fully customer, typically penetration not in it's are And within of is but a states state. as lot states, the a a lot of

a speed got which productivity our bigger well and solution. verified. the we've broadly, around using think large from solution, I from been using there's us a the data, our for is our commercial our selling a there -- is accuracy, again, focus plays out think, macro, big accuracy we positive in the So team. to in And We're which XXXX Washington

So big and million. year TAM. $XXX We remain on the bullish of we at future our that $X roughly very government billion exited the business

the agency. level and us for got the lot at the into the or is opportunity we've of opportunity a state battleground So really

deployed So we've on the these Equifax in programs. to really that's work resources why state got capitals

very around government So optimistic we in the remain future.

Operator

Our next question Alwy Deutsche of from Bank. Faiza is with the line

Faiza Alwy

think mentioned of precore on you to the pull. the hard the wanted revenues that inquiries maybe products I up are XX% I follow soft So the wall and or

you just clarify softballs what are hard and wanted credit pulls. that's I So if or meant XX% to XX%

initial lenders shopping X what the curious to how are in how products. you're terms share And And of 'XX? process? that I'm And shift So do the in you're you using -- if any pre-qual out you are or expect expecting bureaus. X of there, in play seeing penetration whether

Mark Begor

Yes. out playing started It in XXXX.

there's of rates when tailwind people real a were close following That shopping to or pretty increase, further. are metrics COVID whole soft a Your element element started that around large mortgage. us shopping for was

of a really We in what are it, months rates seen or a still people people X -- there's about went as are we've last, mortgage. shopping in the part -- thinking some is higher, the decrease shopping, shopping call shopping, X but weeks, that have less seen those X,

So a change there's been in consumer confidence.

that moves who might by the process. originators in other seen shopping pull some mortgage The changes all historically we've X is there's happening

has X or full Some of which obviously on revenue. either X instead pulling credit the files our an are impact X, originators

call X our originator has that shopping X [indiscernible] because want is is more to there a, obviously focus competitors differentiate makes the our mortgage file differentiated And we talked that credit we to it, shopping focus we're be a twin out I Our importantly, indicators on about data responsive data. file side. it, TWN big but commercially, that between for mortgage as rolling world speak valuable around the more a shopping and our in to in

obviously, credit are file later mortgage mentioned, we our full required process. mortgage credit and as process. with credit data I value both twin auto, the be capture TWN in for You provide file the that And we're including indicator attributes for is also what on file out TWN year, and the of auto, in rolling do same That differentiates and NC+ to first which same mortgage, half we're have we in for with our and that the our reason. auto the our auto. on are happened the for file. mortgage unrelated a shopping also poles, remember, that thing, want still this but credit We'll required mortgage to doing incremental may

spaces put to data for mortgage in Equifax it's, a compete credit with our we on differentiated attractive So both only twin our really have, file. I only think, can those that Equifax really advantage and indicators

John Gamble

soft down pulls. right? there's terms revenue, of of addition in job, we percentage to of So numbers, XX% single-digit revenue a over the right? is So something rental batch in be hard I property a right? high hard just revenue, quoting And polls, that UDM, things would were when our it's And then wouldn't data, high and et soft ball, you inquiries. the referenced single-digit data, that remainder percentages it's the cetera, is pulls, XX just over be So something other break mortgage soft that

Faiza Alwy

on -- it. improvement outperformance? both on I some this, in then as And Got thoughts just a saw missed inquiries the when quarter we any for of fourth if know but apologies follow-up, 'XX those and I metrics.

curious that. So about . how you're thinking

John Gamble

Yes.

talking Just inquiries mortgage that. I'm a XXXX, in reasons be general, and but referenced, inquiries in right, little than about than really no probably shopping we're hard TWN to just better Mark expecting for the more specificity inquiries

Operator

next Our question the is from line Kyle Needham. of Peterson with

Kyle Peterson

Great.

a focus balance good Just Obviously, and the spot. in leverage sheet capital allocation. me. I the on to one is wanted for pretty

we starting about is a kind and potential and think both as these year? You some the well should timing see of when as in dividend year, between to the of it thinking the are in balancing priorities late X How increasing actions the are How of about you buyback. guys we as that? could middle hinting like guys is

Mark Begor

Yes.

doing we be been to I more hinting, and we've think quite tried for than time. that some

native mode. when cloud invested it's CapEx moving ours As to cloud we know, flow. really quite margin of down free savings that coming a us our cash of from you a excess the bit generating been transformation, expansion the in a to lot where then that goal complete and CapEx is into the of And

the November the in and or hiring over box That's it, more going market we call the that want making close days be market, last cloud. economy? mortgage The visibility to frank, to is where rates mortgage is decision is timing the complete. that little the X, in a market, to at didn't question anticipate XX% is weeks. before your Where around to So to X one we we the of see XX% declining where ago, checked really kind December, early X

rapid. us, has that it's been surprising Now and so to

-- What to on we is where there. are have going impact tariffs that. Where market more going? recent, is are the And so want going? to mortgage see time that rates Where little a

So year. portion I the a think through of getting

on have some more we that. So visibility

important. think it will I quite be

envision you over cash confidence market guidance mortgage when which and market, going ability for around Board and we're at Our lot generate growing hiring want underpinning the EBITDA that can our mentioned, expansion, at get also some cash have flow. to of baselined as recovery now. and we return And with too, to back to frame. cash the to to our of growing as generate Even we buyback well the stock We best shareholders. with generation time And to EBITDA looks cash data give strong the our continued We think assumptions at to free 'XX, our dividend again. as back out want next to and want our use And 'XX in free strategy. we'll shareholders. you mortgage we leverage by M&A both that year. attractive cash return market we as give change is of the buy this excess yours to the multiyear that our of to go the it's expanding time free going plan right going the very or authorization in program for we've with to have that that, years, bolt-on expanding look what cash high in to return we X-plus cash 'XX, a bolt-on a through XXXX And No 'XX, a we and framework lot think of and pick time would on EBITDA we're that is model, we pick grows dividend we look the the margins lot a shareholders. M&A. do then us to -- assumptions, I And like to your then

ours, it's a It's of clear in part implementing that of focus and been our a we envision and strategy clearly XXXX.

Operator

are Research Huber Huber Our next Partners. the with questions line from Craig of

Craig Huber

market has a for been the understand, number to I trying I just forth. obviously, want of difficult mortgage forecast and better years quite just U.S. so mean, to

of business our for -- so current nothing your remainder trends new extrapolating year. forth. forecast the taking obviously the how with of out part you There's mortgage and You're the guys the

just and the And you forth. about For so assumptions you you together of about how year. business, talk there your rest the put however, your for the various maybe some differences making are outlook can

John Gamble

we background one But parts impact. principally impacted we've days, Yes. XX, activity, impact. business to It's decline that. call don't mortgage when has a XX, have is that our it, XX No the hiring heard really macros, from a of the have how do lesser screeners underlying and Same the thing change has you many are happening. a in over We by smaller last, market. XX% which that an been in degree,

are that in place, know have know We that the that contracts, in of all rest with is. where We of we either the Equifax. across up them multiyear broadly know visibility. For a took terms we have with we forecast. can X/X that business, on agreements lot price of We we subscription minimums what price or

pipelines where new business. have adding We deal we're

have We year They're year. last contracts our we . into lay that that forecast. we signed effect into this going

fourth that of we know, as when new second added EWS, have online. in those with that expect revenue to a coming soon partners half, additions other side as we we into the record are have in of the On that in bit the visibility and record add partners in, records already quite translate added us. because we with And come we the X inquiries we you as the those quarter instantly to

all typically. of have don't lots programs have also because records We their with we them

So we're to those them in. working records with add

the of typically are we to a across of business, forecast I well. visibility, think the So able and rest we have lot

framework goal forecast in know lay try goal we in that what of XXXX for investors have we or delivering to around best meet -- say, and the forecast it. case, the we our with in of that balance year, quarter to a goal I out. lay would setting how for like of right Our with for company, the beating this that the conservatism in out forecast quarter is first to our or we And any

Mark Begor

And for of example, expectation get sales, kind think maybe new like I flat, -- auto again, specifically input a some around better. we Mean our from auto, little and is used we and are we our personal I think is customers, similar healthy, relatively I right? and card speaking, around consumer loans. we some consumer the But generally tracks seeing confidence. think concept mean

probably but than And obviously see You've their and through we're internationally, continue the assuming grow markets seen average in framework. expecting really Europe, substantial, framework to in come going we're January. to long-term nothing like that slower see any to we're and the U.K. stronger growth not growth then their that long-term

Craig Huber

appreciate I that.

a follow-up Just question.

is are Vitality that . to place about any the that want for long-term growth putting in energized products there Index, On specific you're you'd that you guys out call very there?

Mark Begor

And to And minutes loans cloud I'll file our again and my whole think I couple got auto Yes. in in when powerful. will prepared it. only doing the we're of mortgage it we on thing file. utility same my combine being We we includes powerful going because is be We're and into now because assets. the credit cell our comments, now as to TWN likely personal going mortgage X credit in thing there's those the and credit we mentioned think indicators powerful the data cloud, file same going few attributes credit then I on highlight a a of super differentiate a deliver rollout phone that. that with can the do file already ago, to can obviously, we particularly ago only think that's of bunch, There's that's USIS be highlighted. very And in top EWS is a list pulled. because with it's and years

X drive the pulled. there. We to market be to We want be to want share

data lot data We're So solution also And leverage know, is data we phone have data success file noncredit I which our set. U.S. opportunities the here cell the we a sets. of our us single in Score, to One really cloud think differentiated assets. fabric, great having takes in call utility you giving the our a with as

we acquired. have We that Teletrac DataX and

and of drive that our again credit together, performance. that which to very a allows differentiate not set credit the large in put trade have and file, consumers we are file lines us You

The and products. up scores AI just third We've would use around and been our of highlight capabilities the I AI. one models is ramping

as we're in I you it think, scores know, models using vast the of majority today. our and

in performance meaningful model score the being element. data driving that around we're And of like wider sets performance One Score used very data lifts seeing

as a our us there. So to is we you a that partner Equifax, whole to and we're a viewed company customers, central report to as but When in stronger valued makes And we're And the the innovating our you bunch innovation customers. more strategy new Vitality bringing and products we run at know, our partner. our around Index. with ideas new DNA

how to innovation really new that cloud we forward operate So and want that's to Equifax of clearly differentiated around products. in our in advantaged central going scale data to the enables us be

John Gamble

not last rates international. answer relative themselves. the growth International about just growth to wanted rates Equifax was to clarify question the my to economies, I

Operator

Our Haas with next Jason of questions line are Fargo. the from Wells

Jason Haas

it, XQ thinking missed say hire hiring white talent outperformance understanding forward? to the I Because you're then about some from the I market expect how if collar versus trend going market. you do and softer Apologies can the talent us that in verification what the will helpful but that you think was of give impacts excluding how

John Gamble

Yes.

about than gave what points, X little the pricing executed indicated we've third we a forward. That don't been quarter, the a it was third weaker But the quarter. would low be in in single really than So we think than way it running was time. annual going quarter was specific market guidance better. -- years. in to historically, and weaker pricing better I digits the high it and fourth right, somewhere digits the Fourth little between was double was different quarter, X was our it over for

quarter Our first XXXX hit of of remainder the them quarter a annual increases 'XX, in price executed in the price XXXX XXXX. of of portion in were and our then increases first the substantially quarter actually the fourth 'XX

effect of of a versus XXXX quarter increases. the just grow-over price issue in because timing 'XX difference we the So fourth in had of

Jason Haas

I a very step if the points outperformance. correctly, of think math It's Okay. Great. implied follow-up, USIS I That's then can helpful. of a outperformance a the XXXX? XXXX. mortgage And percentage about everything as did heard about it's you for mortgage talk right, XX bit from I and down

may I that, think talk I be would know why, but that about you can helpful.

John Gamble

very, soft prequal products in products saw very going difference into 'XX around Yes. earlier, to that pre-approval it was 'XX we asked around XXXX What products. substantial late a in really is was -- those from 'XX XXXX. was question The those growth pulls, around since going were biggest relatively new and and in

of prequal to What drove XXXX well, because that we're the is relative the perform we're and to much a preapproval off growth in expect amount to substantial rate larger fact will but of lower expecting much of So a hard that to outperformance obviously base. pull. be continuing we're coming

in the perform performance. well to biggest our difference continue year-on-year. really We're expecting that's to So

that's drive Mark it's difference about on in substantially, just the prequal in the rate. products. but new difference to continue base talked it more We the driving growth really

Jason Haas

Okay.

to maybe price a you ask follow-up, I to would sorry And But thought supplier third also follow-up. increase. our you second the allude but

is XXXX? of less XXXX a tailwind was it in that than So in

John Gamble

amount, similar. they're relatively On dollar

Operator

is Lau The with from Oppenheimer. line question next Owen the of

Kwun Sum Lau

international in first XXXX the please your in you was a in revenue it X% and the you [indiscernible] unpack the year-over-year and guided fourth more on XX% Could bit growth, about So X% slowdown? that little quarter of quarter.

John Gamble

is is Actually, quite we X% X% model right? good, our think X%. to long-term So

we the X% very to X% good So very, about feel growth.

We some we're to general in was strong we're that's geographies. had a seeing fourth The and as improved about growth from news what Brazil economic seeing weaker. little well dealing us and in the all I think across we're quarter. think really performance really U.K. the we're be of as bit headwinds U.K. that's geography, slowdown And only in Mark good XXXX in bit the in is the is a expecting the with talked affecting fourth in from. Brazil quarter. growth the I performance come where seeing market an outstanding U.K., the really economy

Mark Begor

half, second In really. the

John Gamble

to in half digit. perhaps In Brazil in XXXX, double and expecting the perform we're not XXXX second well

we're So Brazil acquisition happy very way -- is but with performing. the our

So good feel pretty I'd X% we net-net, the year. next about say

Kwun Sum Lau

Got it.

expect a if assumption. do cut mortgage about I lot that in mortgage How was rate given But already. mentioned XX for But to let's down think that last about you a there is to inquiries do went on still mortgage questions incremental any . or year's you quickly benefit year? there XXXX, refinancing So basis X% increase. weight in baked this you XX-year haven't of you rate mortgage and that your wave point say, XX know a, there's already.

Mark Begor

with an in up, and impact in an of impact changes yes, in when magnitude points. us how rates and seen same and of we've or rates January changes the in hard move that you down we uptick to shopping and activity purchase that how to went late as inquiries, definitely year seen had expect would rates we've tariff on it's mortgages, mid-December back an This down. the mortgage going XX-year XX come rates to that the as both the rates a see another in there's if September out. mortgage But refi, impact, see clearly did August, which, now the discussions Yes, and down the we mortgage of and XX-year with through on been in market rates It's election, drop the settle the advance it deep both the reacts, in all with with going with marketplace kind has is X as you surprised rates. big when happened bond know, impact point and and above the way went when

-- I consumer clearly is it lower confidence mentioned a car. a decision think of with place there administration, That element new But long buying we're stay seeing and or perhaps And historic buying lower, confidence we're that's activity now, to mentioned is also, long taking is it activity. term. over XX% and in home then is term, the decisions around a all going clearly the that into levels below rolls around don't the inquiry John there's right We that the that. which over some mortgage consumer

of be again We're and doing the meaning over wouldn't would been you that do. let margin. there's to right We mortgage the market future incremental us we very if come through. in that incrementally for for we'd we a revenue the margin as our impact of drop investments to Equifax incremental revenue, to invest through. recovers. a $X will and deck and will more have expect if an framework to flow The as We're that's And outlook, the rates today accretive our is question expect down. we Equifax. we to it to cash going for XXXX, against our XX And long billion of expect our positive term up. Equifax tune is EPS over up when and as showed clear, very flow the that we've going that well continue be meaningful to for uptick, focus that margins impact that our there If incremental minus to our And drive

John Gamble

going mortgage recover. Mark can to a need the which extremely well. in and X of X% again, stabilize our revenue a to to -- We X%, We assumes mortgage So north X earnings slowly of market growth markets, modest right? the XX% including just growing need And don't right? and start growth deliver in overall see growth to and substantial year, fully deliver mortgage we framework we're market mortgage our long-term as to points mentioned, again, includes to that framework, long-term only

Operator

Our next Andrew question is Nicholas Blair. from the with line of William

Andrew Nicholas

First X is on margins.

thinking can -- like points obviously, lower, you of account little margin guide more basis XXX you or quarter, the if the delta. a math, to the basis year expansion, talked I the of wanting but than XX XX, point approach about this is for it do that bit in lighter mortgage kind would think I seems

cost getting or . from So I'm you kind actions were if you maybe you're the had expansion than thought other the of in wondering to in protect transformation a 'XX. took there better tech if margins quarter bit

John Gamble

Yes.

quoted a margins team We delivered through are correct, fourth is I numbers the So What went did job nice and quarter. the in as you fourth the quarter. you of a revenue. managing the we did team the right? committed, weaker on job think costs So saw we nice the think really I

continuing year, margin to obviously, try even in ourselves to substantial mortgage to as manage growth of allow declines also face we're costs next in deliver So we're to going those closely both talent. but into the

So...

Mark Begor

cost cloud in you savings third quarter year-over-year in XXXX. the implemented benefit giving as us We that sizable know, are

we visibility of real done, completed but those. So those right? So have that, are already we've

So good savings. we 'XX. And for have cost that's cloud as some incremental into news us go we

completed markets some first we the know, complete We'll we benefit that. some you in get going still quarter. We've As from Spain We're got small have December. completing. in we're to Paraguay

completions So we that XX those cloud the from incremental through through of our XX% that as savings present kind to cloud we of principally XX% go rev close 'XX. as kind the of roll in move in towards cost

got in outlook. those we've our So

Andrew Nicholas

you're you're it's set or are product then the my to I the of bit for new offering that more But on products that know a have going detailed. little And a more those that follow-up, mortgage share flag. do you Perfect. TWN later them that in in data for Or get with market auto predominantly on flags year. with also that in and a Is price the play? products --

how of kind out. . to trying plays understand that strategically Just

Mark Begor

We look for both.

be customers shopping want in some file that mortgage, to X think where are about file. If you using we only

revenue because when Equifax you stages is price or card loans. and solution super super verification in valuable So getting And in file I'll credit have dealers thing credit Auto, eligibility that the card for it, all and in. we comes going consumer. as for auto certain that around incremental it. We qualify upfront get for mortgage the many auto. mortgage consumer that should income of pulled loans in And so that auto as we're describe an score in information [indiscernible] to mortgage, on market that is We're many value credit a will because can interaction And the incremental we'll it. be order credit with space. more a credit their income personal guy, but delivering very Because of we provide pull only I share as a old but and early is know likely attractive. it's for value levels knowing same in, auto want even that to provide example, remember, mentioned, file in require combining comes -- I the to pull consumer consumer income use important, loan, credit then

summer USIS, ability share power now post the assets, and having businesses gives last credit those cloud the the to is the USIS and and in in completing So assets really have we but both twin data having price. in our marketplace leverage and drive the drive cloud, us revenue those

Operator

Kelsey Research. the Zhu with Autonomous Next from line question of

Kelsey Zhu

in at the rate XXXX to more wanted they beyond. from level of in about talk and SSA SSA you talk wondering growth the what's the announced contract and expect a about I the if was end you've that can of little revenue bit current extension I run QX. 'XX

originally some state I for on think of state well. amount further years -- the million penetration rely $XXX does as X announced

of how [indiscernible]. wondering light in just that about you're I'm your changing So CMS thinking

Mark Begor

are the a service with point the the the at done customer it's deliver contract local that state in like CMS not and federal the eligibility. authenticate the level, really at security directly that eligibility that the case receiving then is level. If delivered benefits states and is us out, used they income. contract, disability it this federal really where for And In use for federal in changes SSA agency the the particular contract is disability eligibility benefits of This to change you social continue a at income, data the that's so CMS, level. to recipients individuals CMS, have that's their used Yes. a agency it's X states as

higher the So contract us go that's a into contract September prices We I as give had the in XXXX. that mentioned in in going to extended place we've past. in is with And it. benefits the that's what we

Kelsey Zhu

general, was you in sizing growth we I how the thoughts record on or from the about should updated additions . wondering also record have 'XX? just in any Workday partnership think if incremental

Mark Begor

last discuss have just one. We we we -- the is partners, Yes. as September unique any we announced that you that of because both know, -- Workday so we don't fact don't typically it our highlight

talk So what don't in. we record partner additions specific about

of last I We added XX%. records, as have XX plus X term. long in higher quarter. of the of over expect X% being were of over XX XX range. the long Workday, we X years, been the fourth said, very last last additions X%, That's year million term the EWS, additions in But those partners. record what including kind we record kind year, we strong for additions Record about XX strong over quite above have up than And think

So years. very strong

we pockets quarter, partners yet. for the is visibility on X have as have added onboarding XXXX X, of were positive have half. we And come a earlier, On didn't records. lot fourth still those in in added partners mentioned records second X the X, records around partners we still we are or that added And we we I There the a new client that structure the Equifax, of ago records. adding to partners where of X, databases their X, When typically, we're those But from records. become we're ago. still of we get a technology onboarding couple have they given years years even new

of for not to potential years partners that year. quarter of added we have the also a to are talking on a like we've we're board around that with we list So that look X And like XX bring part visibility that's year a when Equifax last through X we today been year, years, looking big a set a XXXX. -- our or records of then forward a

UC our under also. little or And employer XX% through business. our reminder, direct as they're we then as from there relationships a our I-X of grow And clients, come in a clients records bringing records

So it's approach. multifaceted a

additions. and we the it's given a obvious ago, leader made that We have kind adding record focus off dedicated benefit of team the paid a from change with in or having was records. drives X XXXX of in leader a That year X value

focus big got we've on So that. a

XXXX laid are growth expecting for for framework that of we growth we So in year with the aligned kind out the is record EWS.

Operator

of the Wetzel line Scott question Research. next from Wolfe The with is

Scott Wurtzel

this me. Just long-term color frame kind X EWS you and was relative on and that for think revenue sort medium-term record context you're of penetration the contribution that When sort about growth maybe framework, growth of question from can pricing in of guidance growth the your year framework. helpful. expecting of growth But to to if the we the

Mark Begor

Yes. we including talk that year We EWS. our as about we clear but don't take of price businesses, can know, businesses, any don't -- you all in in every price we of be up our

with more parts Equifax. I for we in us TWN positive advantage, of have think the pricing and uniqueness of XXXX will, deliver you what we've EWS. many we in than if times, said because will we Penetration other EWS do a in of be

we pillar X We rollout ability out, a for, new over an XX% continued as so and again, be know, competing, our penetration, the as we're space. still a grow, the strong point XX% on gosh, large grow rollouts that we is of years, expect records against new in the vitality, over-indexing product where you auto, in it's manual have to opportunities. with whether almost EWS, been They've positive. goal screener, products you of very to important verticals expect, of lot And of background verifications, agency there's employment a principally with room verification penetration a just verification with and then income to also government

some those the So our are on. of are areas focused teams where

Operator

Our next Capital RBC Sabadra are Markets. line from Ashish questions the of with

Unknown Analyst

that This question. I just not to on Are Sterling a seeing dynamic related is merger. on any commenting in last Ashish. I you you you're for seeing to any shifts know David competitive pricing, the advantage first follow-up -- have are

Mark Begor

don't talk about Yes. We specific customers.

we and relationship all And strategic a do you great of we we other relationships Sterling a First of as Advantage. background screeners, whether verification we them and employment. with it's partners, with them, with view the with relationship have kinds As know, great have

education that them. working we're As deliver them, solution. We you know, data we to to have sell incarceration an new to products

you don't very specific of talk with well want impacts, mentioned rest but industry. we as have partnerships So strong the as X the about to I the

Operator

the with from Partners. from O'Neil Our line FT is of Matt next question

Matthew O'Neill

through or is I And public guess, mortgage most commenting the I verticals, size labor with last the some or any price talent to back noted. private, of areas, while going month. weakness incremental sort and employers of comments not the price, on curious, or then on conservatism just Just fully type rolling understand where score

a of process. if Just curious anything . been note smooth if that's there was there

Mark Begor

Yes.

where screens, The onboarding, on And there's remember, we're I-X there's less employees, less [indiscernible] selling in first background solutions. X there's hiring. and also new If less I-X.

impact very use companies coming tariff whole as broad-based. XXXX think are into it's belt with keeping about of their about lot are. of concerned about in plans happen. seems a term going tight the budgets they mode. and for It conversations are what's the customers, be create be There's a impact that telling the around trends they conservatism. going an a hiring to kind you our clearly and banks Washington, with So we customers talk postelection to We're the When lots election of and as what's what to

all the seen impacts But like on you've think impacting of hire and activity that sitting surprising us. when a how think it's kind that sidelines of resources. latter consumer the just and what play going I so And declined out. don't hiring around quarter been they to the to this the see investments is impact likely on of about that the mortgage, is people of in the customers kind election where that to kind lots you companies confidence meaningfully when of half -- happens, of post are people lot clearly us

through. what your And the I question? half second sorry, was went the was, on supplier of pricing the And increase think, question that

Unknown Analyst

as there to Just in how on expected or anything note the nothing market flowing [indiscernible]. been fairly it's that's if was if through received

Mark Begor

Yes, credit it. a in all increase think I is pulled that received bureaus way the there's from credit where mention increase shopping that as might a we Nobody price X X probably is behavior around challenging. did right that But in historically change files price of likes have expected originator size some shopping the process, to process. describe a and mortgage

by quite on process, that cost about likely how why drive we're the file. a credit that's something do and to our energized would focused us our pull going driven competitors. to differentiated focused then -- a differentiate that it the from dual ability would we X that's And changes we Some to the and having why the and of for that's credit or in pull our pulling we're indicators TWN file, those we're is on expect add single revenue share later

Operator

. The line with next question the Simon of Redburn Atlantic. Clinch is from

Simon Alistair Clinch

questions. X got I've

sort if First, we've from well through first pricing last about as mortgage today. wondering top EWS of the before, could the all, we've just seen despite comparisons just in mix, that. over and talked your that quarters, growth easier of still just of you and but as that's walk contribution weaker X you outperformance as pervasive seen record on

from think I how we So going wondering here? forward should that about was portion

John Gamble

So to of you're is -- that you about? relative you're underlying inquiries. referring revenue mortgage say asking the When performance what to

Simon Alistair Clinch

And contribution? if strip records the I growth

John Gamble

-- right? as gone to in We good about the the feel we've through ability relatively which seen adding actually underlying way of it's in driver, performance outperform think we've records, inquiry the market. strengthened We biggest terms the right, about the our year, is

how we about So the progressed it's feel year. very good during

It's gone from...

Mark Begor

year. the during improved It

John Gamble

during ended double fourth in Very nice the year we the quarter. and digit Yes. entire up

which does. is what's whatever good -- board right? ability to perform going I about, our Mark right? good, go market mean, be what to relative the the that driven -- us tremendous -- year we heavily to driver, by allow all success feel year, we will records, new into So next again, to is and new in the So performance so successfully which -- we to and by mortgage continue records, So very think continue had as it's to we the talked well is driven about this boarding

Mark Begor

in in are, a add Generally, verticals that we customers There's, is that the a They're generally subprime And we'll in the of prime we're beauty of the EWS in that's home, call mortgage -- personal and I'd makes know, every adding and participate and in they're customers multiple or the those as States lower a of sense, know record And in income the records records auto prime super they're it, remind value I we added have mortgage every valuable portion are value owns loans, space. loans. demographics the you, not really customer consumers. but participate population as United record this near you given now different valuable super going And government. super value. forward. smaller

rolling in second model we out about we do out do new the new And positive take records out talked the a roll revenue. products, really the in new in we've -- space, half rolled got of we So to mortgage TWN some powerful which -- last in addition be that that will we price EWS. it's and for a records indicator XXXX, a year products in products like Equifax some

Operator

Okay. That's helpful.

risk and twin how then VWS EWS the I'm file. indicator by Just verifications, to questions of secondarily, know with credit this to balance. that bundle you've I on the indicator, balance going going to a to about value had And that point customers how TWN you're first the you of of foremost. indicator be the the providing the reducing that do X from records in mean, on the the is few going already. you are only But when I credit available file, thinking of about

Mark Begor

the most vast it's great I'd mortgage mortgage originators In Twin. a originators, the use question. of mortgage No, say, majority space,

customers Auto, of their that there's pockets So now. don't. customers

will you portion shopping helps full not portion levels important later very file to in with careful, protect in all is shopping a And or slivers a deep that with which when the on being call application customers because balanced Mark small around doing that a and that in mortgage upfront even So that's the -- valuable. larger but they're auto is that want employed information going data. manual twin verification, they're very imagine, available in a knowing it we're auto, if happens make mortgage opportunity. indicators poll very of to an process to the might upfront of be we around very be very But credit this we'll that Mark's process the but it's giving as giving information, that fact in

to anticipating different XX Mark shopping We the Twin that It's for employed? originator some on mortgage. income working? report. XX going XX It credit back months. That's months, you or at auto is is that upfront file. a an that that F&I the It not valuable we're months, what individual Mark of credit might loan a auto in trended have XX be What separate put or that might mortgage average attributes on XX where on the data shopping dealer just needs maybe consumer process It's couldn't be qualify full over months. are really got or if super Mark's last shopping snippets, will,

remember, propensity So a X a about kind by decent comes do in consumer to get products loan past information process out have to steer they're might credit but is on really ability a someone's information. want of their based of that is but gives with shopping put score, score, it around credit just file, their that new score credit information to their on repay. having a -- that has which behavior Because what They front work. or repay and really with today you work consumer? help you what to additional that a credit of in

that. to don't have visibility You

or file, credit now, or that's their We file want is upfront. typically many I I in to customers also kind will think twice the to second it more and sometimes of workflows. credit files twice So time, protect workflows to as or third actually these value in differentiate we our a then the a but thing our full dependent mentioned credit that deliver vertical. protect deliver the pulled are either reports in or TWN pulled upon of Xx those the processes once And

Operator

is from with Truslove question line next Arthur Citi. of The the

Arthur Truslove

from couple A me.

wondering small. or can you just mean, was in the might so. expected so your said I XXX I XXXX. cost 'XX, XX.X% in was from first that go you've XX.X% bps in this So given guess, have I cloud-based one, margin savings increase why USIS up

was I wondered So what there. just missing

X, Second hiring I mortgage to guiding the or as at at of mortgage volumes, to well, it? And forecast key just And the what in situation the factors you of this is question, this reason function in rates call minus you've X%. month on and your this made you've confirm that deteriorated. like just obviously seen that the last mortgage it clearly isn't on in point. has over seems weeks, probably clear XX% is wanted down -- that is a few last

. just properly. understood you confirm can I've that that So

Mark Begor

Yes.

seen shock surprising it. it, rate again clear, X%. And be update in happening, again, but just What lay in been the in reality. weeks in also perhaps the I to XXX%. we've as all when activity there decline, far only Washington. seeing what has X the not of over as that in X, rates of confidence paper And sharp consumer in they're one, the reading second what last what's about changes to as we're The a we have And activity went this you'd think see the over but depth a we'll

give For our sure, earnings. report first we'll in quarter update you an we April when

this in increase a activity. interest our come August, down decreases, in there's -- rates mortgage the revenue that And or super XX saw in our activity in year, rates economists. can't we Xs, into the change we and the margins forecast We or either call, down consumer last expand -- confidence not as September September on clear mentioned years, come forecasted because saw earlier if in the slightly. Over how we an we and that last been is improves, but you with we've will expand if this we're rate increases EPS our

what John, want and we where is margins? one to there's behavior correlation So to are do the you know on first rates a between take consumer be. going

John Gamble

from it's So improvement Equifax we're that's to margins, cost to the right? the USIS in cloud margins, from again, reduction very seeing savings driving margins. similar absolutely moving

long-term model. in And have high Our very XXXX our we than is margins. variable rate growth lower obviously, in

So long-term expansion in a for percentage model what is we're to would with you basis. larger being seeing, margin X% higher is that the see growth X%, rate terms of inside right, much the that USIS

are quite talking fighting all we we've which some about been things the for of One time. against,

price revenue it some from supplier our but dilutive. lift is margin also get we mortgage Obviously, increase,

but with along own passed profile increases price So really our margin it. of it our the hold with to we isn't through. way margins accretive increases can because the price

on on So beneficial beneficial not but the side dollar the revenue beneficial percentage side. side, margin margin on the

Arthur Truslove

in margins on and you're Workforce TWN follow-up Solutions, down you're okay. for if obviously bringing X of partners. saying is forecasting part it's me, that

TWN years. give of points on how subsequent partners bringing Just then back and whether that costs idea then the an many in basis comes

Mark Begor

is This costs. onboarding Yes.

We'll incremental we because costs, year. a people XX involved, bit So bigger last normal just have it's it's onetime than cost. little added technology partners

onboarded, does John, second yes, our activity. I away. there's additional there's So just go I adding additions it of amount just those still of think half right? being as now And some said, are success because year larger so last a partners, of It's

John Gamble

margin right? pay to Yes. in board being faster, partners We the that as occurs. which incentives that it it to ends happens, period, up dilutive So

Operator

Our line Tong next comes from Sachs. question George with the Goldman of

Keen Fai Tong

conditions. on With to outlook that internally drivers drive your respect upside margin can external given EBITDA you XXXX . relatively to your have say margin your you is would elaborate you Or could outlook, key fixed guide?

John Gamble

continue vast lot majority of drive product of about, to is our drive a is to points have a XX on driven Obviously, biggest revenue ones right, year faster. right? long-term growth, talked revenue by high expansion way the portfolio. the basis which we that which of is Mark's across variable margins our more extremely fact margin already there's Obviously, ability The the our drivers internally to

as to scores, growth rates, and products into the it more products, better continue more more new faster, products to we we can by data as contribution ML data introduce and our -- So incremental usage drives [indiscernible] put it benefit higher we our drive drives customers. more AI revenue

is biggest to to drive thing So continue we obviously the more then And drive can revenue rapidly. work do costs down we'll faster.

on that, One migrations. of we do ways our executing obviously, is the cloud

as occurs, going as we drive forward. continue quickly that we costs XXXX, will to manage but we'll costs through can and every prudently go we out in continue year effectively, costs that to take execute As out, more those

Mark Begor

I from get XXXX guess, going what upside margin, markets. revenue, they cash principal drive going that what upside, it's to flow principal impact to the to on revenue and going from costs for happens We're where that's expansion be we're expected, to substantial us and If -- more free drop all the through, better, it's for expansion. framework mortgage is hiring XXXX, margins. and meaning you our The you're margin or had for George, the incremental you've is quite invest not they're expected Street that going, seen because EPS that

Keen Fai Tong

sense. then of lot any the with cloud you savings on perhaps provide phasing of savings, a color And and XXXX? XXXX could in quarterly to respect your transformation Yes,

John Gamble

be think USIS big us the to I increase would as Yes. completion. them in into in XX% to smaller. When a that smaller. big close was going being got from substantial in cloud XXXX XXXX. like savings cloud about that comp think much very also you about the They're and We

they are. example, Spain of haven't when completing guidance. we quarter, first other expect in about our you think the for We and those are year, some completions what this in the communicated

shouldn't cost So near in our anywhere what the them but and they're magnitude they're saw what in you to about prior the of years. actually you as think of being some last year be, expected plans,

Operator

final line is of Rosenbaum with Shlomo Your Stifel. from question the

Shlomo Rosenbaum

is X terms of for from areas are me. banks -- expectations and in This for can the you just various credits macro What on performing? how of are hearing

John Gamble

Yes.

banks, So the positive. I that's with think employment a our fintechs, unemployment and low customers, high, around globe here and broadly,

bills. get that consumers their clearly is generally pay working, are So X they is

impact and in that have delinquencies subprime I still on inflation, think we've impacting is which their terms increased. relative that seen high consumer,

change of there still seeing already issues that take kind banks, are you're set So very strong. real the fintechs the in you if on underwriting players financially When of capacity see are space. strong no customers spectrum. fintechs, principally focused some subprime And on want and But level seen will, their there. on. the think originations credit growing repositioning, about you And there. to the of that you the focus around broader don't you've The our

is piece other higher rates. The around consumer of confidence of it the impact and

or cars that and I not We've talked the new new used old road, car. buy in nauseam keep think them around used that we've auto cars where on keep versus are higher an consumers car, buy seen mortgage. to forcing ad meaning impact rates either new

So in I behavior we which call customer been don't outside of, what in about, don't change already real either the any there's there rates. XXXX. talked XX%. think back, we see we've an FI, go broadly, see mortgage think behavior 'XX from seen down a in higher stepping we've in or I impact maybe as consumer But change it, clearly we into

Operator

At closing for to this Trevor time, back I remarks. will now Burns turn the floor

Trevor Burns

And if Thank day. Molly you. have myself. follow-up Otherwise, everybody. Thanks, a to . questions, great you reach and please out have any

Operator

today's This conclude conference. will

participation, You day. may and your wonderful disconnect your a for lines at this time. Thank you have

Equifax (EFX) 6 Feb 252024 Q4 Earnings call transcript