Equifax Inc Q3 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Jeffrey Meuler - Robert W. Baird & Co Inc - Analyst : Yeah. Thank you. Good morning. Can you go into more detail on what you're hearing on the mortgage pricing changes, including anything coming out of the MBA conference? I hear you that the conversions not easy and will to time, but I thought you also said you have some clients in production with VantageScore. So just, I guess, how active are the conversations or transitioned?

Question: Jeffrey Meuler - Robert W. Baird & Co Inc - Analyst : Okay. And then can you give more detail on the margin guidance, including the reduction in USIS margin guidance? I'm just not understanding the message because I thought that you were going to flow through mortgage-driven upside. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 21, 2025 / 12:30PM, EFX.N - Q3 2025 Equifax Inc Earnings Call And I think non-mortgage is also slight better than expected and the incremental margins on mortgage market-driven upside should be higher than your reported margins. I heard a bit about incentive comp, but it's not adding up to me with the prior commentary that you flow through the mortgage market driven upside. That's it. Thanks.

Question: Toni Kaplan - Morgan Stanley - Analyst : Thanks so much. Wanted to start on government, very helpful commentary about the error rates and the ramp-up that you're seeing in discussions with the states. I guess do you expect that this will really start to ramp after the end of the government fiscal year-end? Or will states really pre-emptively start using your solutions ahead of time? I know you talked about second half '26, '27 is really where the sweet spot will be but just wanted to understand the process a little bit better.

Question: Andrew Steinerman - JPMorgan Chase & Co - Analyst : Hi. John, could you just go over a little bit more the general corporate expense line in the third quarter and what's driving that?

Question: Manav Patnaik - Barclays Services Corp - Analyst : Thank you. Good morning. The first question, if you could just remind us the different moving pieces, I guess, on the mortgage side. What I'm referring to USIS grew 26%, but EWS was only 2%. Can you just remind us of the different factors? I know there's always a difference but just maybe in this quarter?

Question: Manav Patnaik - Barclays Services Corp - Analyst : Than you. And the feedback on the score pricing, I think that makes sense. So I was just curious if you had received any feedback from your customers on the, I guess, your credit file cost increases that you made? Is that even something that bothered you about?

Question: Shlomo Rosenbaum - Stifel, Nicolaus & Company Inc - Analyst : Hi. Thank you very much for taking my questions. Hey, Mark, given the focus on generating more VantageScore traction, can you talk about what it is that you guys can do to drive the adoption in the marketplace? I mean, is there going to be a step up materially in your sales and marketing budgets in the area? Are you guys going to provide some help to the customers in terms of back testing it versus FICO? Like how should we be thinking about this operationally? And then where the efforts you guys are going to put in? Obviously, I understand it's a multiyear effort and seems like it's kind of an uphill effort, but the cost advantages over the long-term might make sense, but you got to get these big bank behemoths moving on that.

Question: Shlomo Rosenbaum - Stifel, Nicolaus & Company Inc - Analyst : Thank you.

Question: Kyle Peterson - Needham & Company LLC - Analyst : Great. Thanks, guys. Good morning. I appreciate you taking the questions. I wanted to see if you could help us unpack some of the moving pieces in government. I saw overall what's -- the guide looks pretty solid for the fourth quarter, but understand there's a little bit of noise with some of the federal business with the shutdown, but then some of these other state and local opportunities that are ramping. So just wanted to see if you guys could give us any more color on the net effect and particularly some of the ramp pace of some of the state and local business. That'd be really helpful. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 21, 2025 / 12:30PM, EFX.N - Q3 2025 Equifax Inc Earnings Call

Question: Kyle Peterson - Needham & Company LLC - Analyst : That's really helpful. Thank you very much. Nice results.

Question: Kevin McVeigh - UBS AG - Analyst : Great. Thanks so much. Hey, I wonder if you could give us a sense of -- I don't know if you said this or not, John. But for '26, the revenue, could it be in the range of the 7% to 10% on the organic framework, or did you not say that? I just want to make sure I didn't confuse your comments. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 21, 2025 / 12:30PM, EFX.N - Q3 2025 Equifax Inc Earnings Call

Question: Kevin McVeigh - UBS AG - Analyst : That's very helpful. And then, Mark or John -- I don't know. This may be a tough question. But any thoughts on what you define as success from a market share perspective on VantageScore longer term given the shift, and obviously, to your point, it was a 30-year monopoly? But as that share shifts, what would be a reasonable proxy? And does it go to market motion factoring your partners on Vantage, or is it independent?

Question: Kevin McVeigh - UBS AG - Analyst : Thank you.

Question: Surinder Thind - Jefferies LLC - Analyst : Hi, Mark. Just a question on the bigger-picture VantageScore and the adoption curve here. A lot of the conversation seems to be focused on VS4 versus classic FICO. Can you have any thoughts on 10T entering into that equation? Because when I think about it from the perspective of a lender, wouldn't the lender first want to make the decision of whether they're going to stick with classic FICO or upgrade? And if they choose to upgrade, then it's actually VS4 versus 10T, not VS4 versus classic FICO in the decision.

Question: Surinder Thind - Jefferies LLC - Analyst : That's helpful. And then in one of your other comments, I think you talked about just being more than a data provider.

Question: Surinder Thind - Jefferies LLC - Analyst : Are we shifting to more of a platform and an analytics approach here at this point? How should we think about that part of the transition? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 21, 2025 / 12:30PM, EFX.N - Q3 2025 Equifax Inc Earnings Call

Question: Surinder Thind - Jefferies LLC - Analyst : Thank you.

Question: Andrew Nicholas - William Blair Capital Partners - Analyst : Hi, thank you, and good morning. I wanted to first ask about just overall consumer credit trends or conditions. I've seen some headlines and bankruptcies lately in the auto space in particular. Just kind of curious what you're seeing in terms of scores or credit conditions and ability to pay within your different markets.

Question: Andrew Nicholas - William Blair Capital Partners - Analyst : Got it. Thank you. And then maybe just a point of clarification. I think within EWS non-mortgage consumer lending was up 20%. I think in absolute dollars, far and away, the best quarter that line has had in my model. Just curious what's driving that and maybe the sustainability of that level of growth.

Question: Rayna Kumar - Oppenheimer & Co Inc - Analyst : Hi, good morning. Thanks for taking my question. I know you mentioned earlier that hiring, particularly white collar hiring, continues to remain stressed. Can you give us some detail on what you're hearing from your conversations with customers and background screeners? And what is the expected impact to talent in the fourth quarter? Thank you.

Question: Rayna Kumar - Oppenheimer & Co Inc - Analyst : Appreciate the color.

Question: Jun-yi Xie - Wells Fargo Securities LLC - Analyst : Good morning. This is Jun-Yi, on for Jason Haas. Your USIS mortgage outperformance was 33% in the quarter, which was a step-up sequentially. Is that driven from the new mortgage pre-approval products, or what else drove that incremental outperformance?

Question: Jun-yi Xie - Wells Fargo Securities LLC - Analyst : Sorry, the 33% I meant was -- like, you did 26% revenue growth, and then inquiries were down 7%. So you got 33% (multiple speakers) --

Question: Jun-yi Xie - Wells Fargo Securities LLC - Analyst : I get your point, sir. Sorry, my second question. So one major adoption hurdle for VantageScore is often cited as its acceptance within the securitization market. So giving out free VantageScores along with each purchase of a FICO score helps you get visibility among lenders. But I don't think the securitization market will end up seeing it; correct me if I'm wrong. But how do you plan to navigate these adoption challenges?

Question: Jun-yi Xie - Wells Fargo Securities LLC - Analyst : Thanks. That's a good color.

Question: Faiza Alwy - Deutsche Bank AG - Analyst : Yes, hi, thank you. Good morning. Mark, I wanted to ask about a significant push that the MBA seems to be making around a shift away from the tri-merge report. I know we had this discussion a couple of years ago when the bi-merge was first introduced -- the idea was first introduced. But it just seems like the voices are getting a bit louder. So I would just love to hear how you would respond to that, and how that might impact you and what you're doing to sort of counter that?

Question: Faiza Alwy - Deutsche Bank AG - Analyst : All right. Understood. And then just to follow up on government, I know you recently launched your Complete verification product. Just curious how much traction you're seeing with that product versus more of an instant verification? I'm curious if you can comment on the competitive environment on the consumer permission side within government. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 21, 2025 / 12:30PM, EFX.N - Q3 2025 Equifax Inc Earnings Call

Question: Faiza Alwy - Deutsche Bank AG - Analyst : Great. Thank you, Mark.

Question: Kelsey Zhu - Autonomous Research - Analyst : Hi, good morning. Thanks for taking my question. You sized VantageScore upside in the mortgage vertical, which was very helpful. So I was just wondering if you can talk about a little bit more VantageScore opportunity in non-mortgage vertical and particularly around current penetration REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 21, 2025 / 12:30PM, EFX.N - Q3 2025 Equifax Inc Earnings Call rate within card and auto and pricing difference with FICO, and where you see the adoption rate for VantageScore could be in the next three to five years?

Question: Kelsey Zhu - Autonomous Research - Analyst : Got it. Thanks a lot. And then second question on the government vertical. I was just wondering if you can tell us a little bit more about the evolution of the SNAP contracts. Because I remember in the Q3 2023 call, you talked about the $38 million contract with the USDA, which I think was a base year value. But that was possibly impacted by the funding practice changes at the USDA in 2024. And then on slide 6, you talked about launching a new product that provides agencies monthly life changes to reduce error rates. So just curious to get your thoughts around how much revenues Equifax generated from the USDA or SNAP contract the last two years and also your outlook going forward.

Question: Kelsey Zhu - Autonomous Research - Analyst : Got it. Thanks a lot.

Question: Scott Wurtzel - Wolfe Research LLC - Analyst : Hey, guys. Thanks for squeezing me in. Just wanted to ask another one on the government vertical, particularly as it relates to the shutdown and if we do see this sort of extend longer than what is anticipated. Just wondering if you can talk a little bit more about the potential impacts, like understand there will probably be impacts to your federal program contracts. But is there anything at the state level that is tied to federal programs that could potentially see impacts as well? Thanks.

Question: Scott Wurtzel - Wolfe Research LLC - Analyst : Got it. That's helpful. And then just on the vitality index side and the strong results that you're seeing out of the new products, I know you mentioned the I-9 virtual that has been driving some strength there. But just wondering if you can talk about a few more products that kind of drove that 16% vitality index this quarter, and you're raising your guidance from 12% to 13%?

Question: Scott Wurtzel - Wolfe Research LLC - Analyst : Great. Thanks, guys.

Question: Ryan Griffin - Bank of Montreal - Analyst : Hey, thanks for squeezing me in. I know it's late, so I'll just ask one. Just wanted to dig into the pricing strategy in the non-mortgage verticals, whether on the credit file itself or some of the other package fees. Do you think there's room to move that higher over time? Thank you.

Question: George Tong - Goldman Sachs & Company, Inc. - Analyst : Hi, thanks. Good morning. Your pricing Vantage mortgage (technical difficulty) at $4.50 a score. That compares to TransUnion pricing at $4 a score and Experian offering VantageScore for free. How do you expect Vantage mortgage market shares among the bureaus to shake out with each credit bureau pricing VantageScore differently? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 21, 2025 / 12:30PM, EFX.N - Q3 2025 Equifax Inc Earnings Call

Question: George Tong - Goldman Sachs & Company, Inc. - Analyst : Okay. Got it. And I believe Experian's strategy is they're offering it for free. But if they choose to monetize it, then they'll charge 50% below FICO going forward.

Question: George Tong - Goldman Sachs & Company, Inc. - Analyst : Okay. Great. Secondly, you're launching various Equifax.AI solutions, including the Ignite AI Advisor. How are you planning to monetize your AI products? And how does that monetization compare to the cost to deploy AI?