FactSet Q3 Revenue Jumps to $545.3M, Net Income Up 11%

TL;DR

FactSet's Q3 numbers are solid, showing strong subscription growth and profit, making it a reliable bet in financial tech.

AI Summary

FactSet Research Systems Inc. reported robust financial performance for the third quarter ended May 31, 2025, with revenue increasing to $545.3 million, up from $509.7 million in the prior-year quarter. Net income also saw a significant rise, reaching $150.1 million, compared to $135.2 million in the same period last year. The company's diluted earnings per share climbed to $3.98 from $3.59 year-over-year. Annual Subscription Value (ASV) plus professional services grew by 6.5% to $2.20 billion as of May 31, 2025, demonstrating strong client retention and new business. Operating expenses increased to $365.2 million from $340.5 million, primarily due to higher personnel costs and technology investments. FactSet repurchased 100,000 shares of its common stock for $45.0 million during the quarter, reflecting confidence in its valuation. The company continues to focus on expanding its content and technology solutions, particularly in wealth management and private markets, to drive future growth. Despite a challenging macroeconomic environment, FactSet's strategic outlook remains positive, supported by its recurring revenue model and diversified client base.

Why It Matters

FactSet's strong Q3 performance, with revenue up 6.9% and net income up 11%, signals continued demand for its financial data and analytics, crucial for investors seeking stable growth in the financial technology sector. This growth, particularly the 6.5% increase in Annual Subscription Value, indicates robust client loyalty and successful product expansion, putting competitive pressure on rivals like Bloomberg and Refinitiv. For employees, this suggests job security and potential for growth within a thriving company. Customers benefit from enhanced data offerings and technology, reinforcing FactSet's position as a critical information provider in the capital markets.

Risk Assessment

Risk Level: low — FactSet exhibits a low risk level due to its consistent revenue growth, with Q3 2025 revenue at $545.3 million compared to $509.7 million in Q3 2024, and a healthy net income of $150.1 million. The Annual Subscription Value (ASV) plus professional services increased by 6.5% to $2.20 billion, indicating a stable, recurring revenue model and strong client retention, which mitigates market volatility risks.

Analyst Insight

Investors should consider FactSet (FDS) a stable long-term holding given its consistent revenue and net income growth, and strong recurring subscription model. The company's share repurchase program, with 100,000 shares bought for $45.0 million, signals management's confidence and could provide further shareholder value.

Financial Highlights

revenue

$545.3M

net Income

$150.1M

eps

$3.98

revenue Growth

+6.9%

Revenue Breakdown

Key Numbers

• $545.3M — Q3 2025 Revenue (Increased from $509.7M in Q3 2024, representing a 6.9% growth.)
• $150.1M — Q3 2025 Net Income (Up from $135.2M in Q3 2024, an 11.0% increase.)
• $3.98 — Q3 2025 Diluted EPS (Grew from $3.59 in Q3 2024, a 10.9% improvement.)
• $2.20B — Annual Subscription Value (ASV) plus professional services (Increased by 6.5% as of May 31, 2025, indicating strong recurring revenue.)
• 100,000 — Shares Repurchased (FactSet repurchased 100,000 shares for $45.0 million during the quarter, signaling confidence.)
• $365.2M — Q3 2025 Operating Expenses (Increased from $340.5M in Q3 2024, reflecting investments in personnel and technology.)

Key Players & Entities

• FACTSET RESEARCH SYSTEMS INC (company) — filer of the 10-Q
• $545.3 million (dollar_amount) — Q3 2025 revenue
• $509.7 million (dollar_amount) — Q3 2024 revenue
• $150.1 million (dollar_amount) — Q3 2025 net income
• $135.2 million (dollar_amount) — Q3 2024 net income
• $3.98 (dollar_amount) — Q3 2025 diluted EPS
• $3.59 (dollar_amount) — Q3 2024 diluted EPS
• $2.20 billion (dollar_amount) — Annual Subscription Value (ASV) plus professional services as of May 31, 2025
• 6.5% (dollar_amount) — Growth in ASV plus professional services
• 100,000 shares (dollar_amount) — Shares repurchased in Q3 2025

FAQ

Risk Factors

• Challenging Macroeconomic Environment [medium — market]: The company acknowledges a challenging macroeconomic environment. Despite this, FactSet's recurring revenue model and diversified client base provide resilience.
• Increased Operating Expenses [medium — operational]: Operating expenses rose to $365.2 million from $340.5 million year-over-year. This increase is primarily attributed to higher personnel costs and investments in technology, which are crucial for future growth but impact short-term profitability.
• Technology and Content Expansion Investments [medium — operational]: FactSet is actively investing in expanding its content and technology solutions, particularly in wealth management and private markets. While strategic for long-term growth, these investments require significant resources and carry execution risk.

Industry Context

FactSet operates in the financial data and analytics industry, a competitive landscape dominated by a few large players and numerous specialized providers. The industry is characterized by continuous technological innovation, increasing demand for integrated solutions, and a shift towards cloud-based delivery models. Key trends include the growing importance of AI and machine learning for data analysis, the expansion into alternative data sets, and the increasing need for specialized data and analytics in areas like wealth management and private markets.

Regulatory Implications

FactSet must comply with various financial regulations and data privacy laws globally. Changes in data reporting standards or increased scrutiny on data usage could impact operations. Ensuring compliance with evolving regulations, particularly concerning data security and cross-border data flows, is crucial for maintaining client trust and avoiding penalties.

What Investors Should Do

1. Monitor operating expense growth relative to revenue growth.
2. Evaluate the success of strategic investments in wealth management and private markets.
3. Assess the impact of macroeconomic conditions on client spending.

Key Dates

• 2025-05-31: Quarter End — Reporting period for the 10-Q filing, showing $545.3M in revenue and $150.1M in net income.
• 2025-07-03: 10-Q Filing Date — The date the company officially submitted its quarterly report to the SEC.

Glossary

Annual Subscription Value (ASV)

The annualized value of all recurring revenue from client subscriptions. (Key metric for FactSet, indicating the predictable revenue stream and client commitment. Grew to $2.20 billion, up 6.5%.)

Diluted Earnings Per Share (EPS)

A company's net profit divided by the number of its outstanding common shares, including the dilutive effect of stock options and convertible securities. (Measures profitability on a per-share basis. Increased to $3.98 from $3.59 year-over-year.)

Recurring Revenue Model

A business model where revenue is predictable and generated from ongoing customer payments, typically through subscriptions or contracts. (Highlights FactSet's stable business foundation, making it less susceptible to short-term economic fluctuations.)

Year-Over-Year Comparison

FactSet demonstrated strong year-over-year performance in Q3 2025. Revenue increased by 6.9% to $545.3 million, and net income saw a significant 11.0% rise to $150.1 million, with diluted EPS growing by 10.9% to $3.98. Operating expenses also increased by 7.3% to $365.2 million, reflecting continued investment in personnel and technology, which is a key focus area compared to the prior year's filing.

Filing Details

This Form 10-Q (Form 10-Q) was filed with the SEC on July 3, 2025 regarding FACTSET RESEARCH SYSTEMS INC (FDS).

View full filing on EDGAR

View Full Filing

View this 10-Q filing on SEC EDGAR