Q4 2024 Factset Research Systems Inc Earnings Call Transcript
Key Points
- FactSet Research Systems Inc (FDS) reported annual revenue of $2.2 billion, adjusted operating margin of 37.8%, and adjusted EPS of $16.45, all above the high end of their most recent guidance.
- The company achieved organic ASV plus professional services growth of $104 million or 4.8%, which is above the midpoint of their guidance range.
- FactSet Research Systems Inc (FDS) added over 23,000 adviser desktops in fiscal 2024, representing over 30% growth in seat count, bringing their total wealth users to over 100,000.
- The company secured significant wins in the wealth management sector, including competitive displacements and large enterprise deals.
- FactSet Research Systems Inc (FDS) is making strategic investments in generative AI, with early signs of success and meaningful usage by clients, which is starting to drive incremental ASV and improve retention.
- Growth in the EMEA region decelerated to 2%, with gains from wealth offset by headwinds to retention on the buy side due to constrained budgets of mid- to large-sized asset manager clients.
- The institutional buy side faced tighter budgets and vendor consolidation, leading to an organic ASV growth rate of only 3%, with higher erosion and a large asset manager cancellation putting pressure on retention.
- GAAP operating expenses increased by 3% year over year to $434 million, primarily due to a one-time $54 million charge related to a Massachusetts sales tax dispute.
- FactSet Research Systems Inc (FDS) anticipates continued pressure on client budgets, which may affect the overall pace of erosion and growth in the upcoming fiscal year.
- The company is guiding to a more muted outlook in the first half of fiscal 2025, with improvement expected in the second half, reflecting ongoing market uncertainties.
Good morning and welcome to the FactSet Q4 2024 conference call. (Operator Instructions)
I would now like to hand the conference over to [Kate Kirby] You may begin.
Thank you, and good morning, everyone. Welcome to FactSet's fourth fiscal quarter 2024 earnings call. Before we begin, the slides we'll reference during this presentation can be found through the webcast on the Investor Relations section of our website at factset.com. A replay of today's call will be available on our website.
After our prepared remarks, we will open the call to questions from investors. The call is scheduled to last for one hour. To be fair to everyone, please limit yourself to one question. You may re-enter the queue for additional follow-up questions, which we will take if time permits.
Before we discuss our results, I encourage all listeners to review the legal notice on slide 2, which explains the risk of forward-looking statements and the use of non-GAAP financial measures. Additionally,
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