EQUIFAX INC

Previous wording

The following Management’s Discussion and Analysis (“MD&A”) is intended to help the reader understand the results of operations and financial condition of Equifax Inc. MD&A is provided as a supplement to and should be read in conjunction with our consolidated financial statements and the accompanying Notes to Financial Statements in Item 1 of this Form 10-Q. This section discusses the results of our operations for the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023. All percentages have been calculated using unrounded amounts for each of the periods presented.

Current wording

The following Management’s Discussion and Analysis (“MD&A”) is intended to help the reader understand the results of operations and financial condition of Equifax Inc. MD&A is provided as a supplement to and should be read in conjunction with our consolidated financial statements and the accompanying Notes to Financial Statements in Item 1 of this Form 10-Q. This section discusses the results of our operations for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023. All percentages have been calculated using unrounded amounts for each of the periods presented.

Previous wording

For 2024, our planning assumes that U.S. economic activity, as measured by GDP, is expected to grow but at a slower rate of growth than experienced in 2023. Our plan assumes the U.S. mortgage market, as measured by credit inquiries, is expected to decline by about 11% in 2024 versus 2023. The U.S. mortgage market, particularly the mortgage refinance portion of the U.S. mortgage market, can be significantly impacted by U.S. interest rates which impact mortgage rates available to consumers. In the international markets in which we operate, in particular in Australia and Canada, our planning also assumes economic activity, as measured by GDP, to grow in 2024 but at slower rates than in 2023, and in the U.K. for GDP to grow nominally.

Current wording

For 2024, we expect that U.S. economic activity, as measured by GDP, will grow but at a slower rate of growth than experienced in 2023. Our forecast assumes the U.S. mortgage market, as measured by credit inquiries, is expected to decline by about 7% in 2024 versus 2023. The U.S. mortgage market, particularly the mortgage refinance portion of the U.S. mortgage market, can be significantly impacted by U.S. interest rates which impact mortgage rates available to consumers. In Australia, the U.K., Canada, and Brazil, our forecast assumes economic activity, as measured by GDP, to grow in 2024 but at slower rates than in 2023.

Previous wording

Geographic Information. We currently have operations in the following countries: Argentina, Australia, Brazil, Canada, Chile, Costa Rica, Dominican Republic, Ecuador, El Salvador, Honduras, India, Ireland, Mexico, New Zealand, Paraguay, Peru, Portugal, Spain, the U.K., Uruguay and the U.S. We also have investments in consumer and/or commercial credit information companies through joint ventures in Brazil, Cambodia, Malaysia and Singapore. Approximately 76% and 78% of our revenue was generated in the U.S. during the three months ended June 30, 2024 and 2023, respectively. Approximately 77% and 78% of our revenue was generated in the U.S. during the six months ended June 30, 2024 and 2023, respectively.

Current wording

Geographic Information. We currently have operations in the following countries: Argentina, Australia, Brazil, Canada, Chile, Costa Rica, Dominican Republic, Ecuador, El Salvador, Honduras, India, Ireland, Mexico, New Zealand, Paraguay, Peru, Portugal, Spain, the U.K., Uruguay and the U.S. We also have investments in consumer and/or commercial credit information companies through joint ventures in Brazil, Cambodia, Malaysia and Singapore. Approximately 76% of our revenue was generated in the U.S. during the three months ended September 30, 2024 and 2023. Approximately 76% and 77% of our revenue was generated in the U.S. during the nine months ended September 30, 2024 and 2023, respectively.

Previous wording

Key Performance Indicators. Management focuses on a variety of key indicators to monitor operating and financial performance. These performance indicators include measurements of operating revenue, change in operating revenue, operating income, operating margin, net income, diluted earnings per share, cash provided by operating activities and capital expenditures. The key performance indicators for the three and six months ended June 30, 2024 and 2023 were as follows:

Current wording

Key Performance Indicators. Management focuses on a variety of key indicators to monitor operating and financial performance. These performance indicators include measurements of operating revenue, change in operating revenue, operating income, operating margin, net income, diluted earnings per share, cash provided by operating activities and capital expenditures. The key performance indicators for the three and nine months ended September 30, 2024 and 2023 were as follows:

Previous wording

•We did not repurchase any shares from public market transactions during the first six months of 2024 and 2023. At June 30, 2024, $520.2 million was available for future purchases of common stock under our share repurchase authorization.

Current wording

•We did not repurchase any shares from public market transactions during the first nine months of 2024 and 2023. At September 30, 2024, $520.2 million was available for future purchases of common stock under our share repurchase authorization.

Previous wording

•We paid out $96.4 million or $0.78 per share in dividends to our shareholders during the first six months of 2024.

Current wording

•We paid out $144.8 million, or $1.17 per share, in dividends to our shareholders during the first nine months of 2024.

Previous wording

RESULTS OF OPERATIONS—THREE MONTHS ENDED JUNE 30, 2024 AND 2023

Current wording

RESULTS OF OPERATIONS—THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023

Previous wording

Revenue increased by $112.9 million, or 9%, and increased by $200.3 million, or 8%, for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. Total revenue was negatively impacted by foreign exchange rates, which decreased revenue by $32.2 million, or 2%, and $52.3 million, or 2%, for the second quarter and first six months of 2024, compared to the same periods in 2023.

Current wording

Revenue increased by $122.7 million, or 9%, and $323.0 million, or 8%, for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. Total revenue was negatively impacted by foreign exchange rates, which decreased revenue by $26.7 million, or 2%, and $79.0 million, or 2%, for the third quarter and first nine months of 2024, compared to the same periods in 2023.

Previous wording

Revenue in both periods increased due to growth in International, USIS, and Workforce Solutions. International revenue growth for both periods is driven by growth in Latin America primarily from the Boa Vista Serviços S.A. ("BVS") acquisition, completed in August 2023, and local currency growth in Argentina. USIS revenue growth in both periods is primarily due to growth in mortgage related online services. Workforce Solutions revenue growth for both periods is primarily due to growth in non-mortgage verticals within Verification Services, partially offset by declines in mortgage revenue and declines in Employer Services due to lower tax credit revenue.

Current wording

Revenue in both periods increased due to growth in USIS, International, and Workforce Solutions. USIS revenue growth in both periods is primarily due to growth in mortgage related online services. International revenue growth for both periods is driven by growth in Latin America from the Boa Vista Serviços S.A. ("BVS") acquisition, completed in August 2023, as well as local currency growth in Argentina and growth in Europe. Workforce Solutions revenue growth for both periods is primarily due to growth in Verification Services, partially offset by declines in Employer Services.

Previous wording

Cost of services increased $42.9 million and $90.2 million in the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The increase in both periods is primarily due to higher royalty and revenue share costs, costs from BVS which was acquired in the third quarter of 2023, and higher third party cloud usage fees, partially offset by lower people costs. The impact of changes in foreign exchange rates on costs of services led to a decrease of $9.6 million and $15.4 million in the second quarter and first six months of 2024, respectively, compared to the same periods in 2023.

Current wording

Cost of services increased $60.0 million and $150.2 million in the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The increase in both periods is primarily due to higher royalty and revenue share costs. The increase in the first nine months is also due to costs from BVS, which was acquired in the third quarter of 2023. The impact of changes in foreign exchange rates on costs of services led to a decrease of $6.1 million and $21.5 million in the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023.

Previous wording

Selling, general and administrative expenses increased $9.5 million and $16.0 million for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The increase in both periods is primarily due to costs from BVS which was acquired in the third quarter of 2023, partially offset by a decrease in people costs. The impact of changes in foreign currency exchange rates led to a decrease in selling, general and administrative expenses of $12.2 million and $20.8 million for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023.

Current wording

Selling, general and administrative expenses increased $47.3 million and $63.4 million for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The increase in the third quarter is due to an increase in people costs primarily due to restructuring charges in the third quarter of 2023, partially offset by decreased litigation expense from an accrual in the third quarter of 2023 for a penalty associated with resolution of the investigation of the 2017 cybersecurity incident by the U.K. Financial Conduct Authority ("U.K. FCA") that did not recur in the same period of 2024. The increase in the first nine months is primarily due to increased people costs and costs from BVS which was acquired in the third quarter of 2023. The increased people costs for the first nine months, excluding the impact of costs from BVS, is primarily due to higher restructuring charges and incentive plan costs. The impact of changes in foreign currency exchange rates led to a decrease in selling, general and administrative expenses of $8.8 million and $29.6 million for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023.

Previous wording

Depreciation and amortization expense increased $15.2 million and $29.4 million for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The increase for both periods is primarily due to increased amortization of capitalized internal-use software and system costs from technology transformation capital spending incurred previously, as well as higher amortization of purchased intangible assets related to the BVS acquisition. The impact of changes in foreign currency exchange rates led to a decrease in depreciation and amortization expense of $0.8 million for the second quarter of 2024 and $0.7 million for the first six months of 2024, compared to the same periods in 2023.

Current wording

Depreciation and amortization expense increased $14.7 million and $43.9 million for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The increase for both periods is primarily due to increased amortization of capitalized internal-use software costs from technology transformation capital spending incurred previously. The increase in the first nine months is also due to higher amortization of purchased intangible assets related to the BVS acquisition. The impact of changes in foreign currency exchange rates led to a decrease in depreciation and amortization expense of $0.7 million for the third quarter of 2024 and $1.3 million for the first nine months of 2024, respectively, compared to the same periods in 2023.

Previous wording

Total company operating margin increased by 1.7 percentage points and 1.1 percentage points in the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The margin increase for both periods is due to the aforementioned higher reported revenue partially offset by the increased operating expenses and amortization expenses during the period.

Current wording

Total company operating margin decreased by 1.6 percentage points and increased by 0.2 percentage points in the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The margin decrease for the third quarter is due to increased operating expenses, partially offset by higher reported revenue. The margin increase for the first nine months is due to the aforementioned higher reported revenue, partially offset by increased operating expenses and amortization expenses during the period.

Previous wording

Interest Expense and Other (Expense) Income, net

Current wording

Interest Expense and Other Income, net

Previous wording

Interest expense decreased by $3.4 million and $1.2 million in the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The decrease for both periods is due to lower debt balances in the 2024 when compared to the same periods of 2023 due to repayments of commercial paper.

Current wording

Interest expense decreased by $6.5 million and $7.7 million in the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The decrease for both periods is due to lower debt balances in 2024 when compared to the same periods of 2023 due to repayments of commercial paper during 2024. The decrease for the third quarter is also due to a lower weighted average cost of debt when compared to the third quarter of 2023.

Previous wording

Other (expense) income, net, decreased by $16.2 million and $19.1 million in the second quarter of 2024 and in the first six months of 2024, respectively, as compared to the same periods in 2023. The decrease for both periods is primarily due to the gain on fair market value adjustment of our investment in BVS in the second quarter and first six months of 2023 that did not recur in the same periods of 2024 due to our acquisition of BVS in the third quarter of 2023, as well as the sale of an investment in 2023 that did not recur in 2024.

Current wording

Other income, net, decreased by $4.1 million and $23.4 million in the third quarter of 2024 and in the first nine months of 2024, respectively, as compared to the same periods in 2023. The decrease for the third quarter is primarily due to lower interest income from investments and a loss on foreign currency transactions. The decrease for the first nine months is primarily due to the gain on fair market value adjustment of our investment in BVS due to our acquisition of BVS in the third quarter of 2023 that did not recur in the same period of 2024, as well as the sale of an investment in 2023 that did not recur in 2024 and a loss on foreign currency transactions.

Previous wording

Our effective income tax rate was 26.4% for the three months ended June 30, 2024, compared to 27.4% for the three months ended June 30, 2023. Our effective income tax rate was 25.5% for the six months ended June 30, 2024, compared to 26.6% for the six months ended June 30, 2023. Our effective tax rate was lower for the three and six months ended June 30, 2024 as compared to the same periods in 2023 due to more favorable discrete benefits in the current year primarily due to the expiration of the statute of limitations related to uncertain tax positions.

Current wording

Our effective income tax rate was 26.4% for the three months ended September 30, 2024, compared to 13.9% for the three months ended September 30, 2023. Our effective income tax rate was 25.8% for the nine months ended September 30, 2024, compared to 22.0% for the nine months ended September 30, 2023. Our effective tax rate was higher for the three and nine months ended September 30, 2024 as compared to the same periods in 2023 due to the write off in the third quarter of 2023 of a deferred tax liability related to our original investment in BVS which was no longer necessary given the acquisition of BVS in August 2023.

Previous wording

Consolidated net income increased by $25.8 million and $38.3 million for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The increase in both periods is due to higher levels of operating income from increased revenue, partially offset by increased operating expenses, lower levels of other income, net, and higher income tax expense.

Current wording

Consolidated net income decreased by $21.6 million and increased by $16.7 million for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The decrease in the third quarter is primarily due to higher income tax expense. The increase in the first nine months is due to higher levels of operating income, partially offset by higher income tax expense and lower levels of other income, net.

Previous wording

Workforce Solutions revenue increased by 5% and increased by 3% in the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The increase in revenue for both periods is due to an increase in non-mortgage verticals within Verification Services, partially offset by declines in mortgage revenue and declines in Employer Services due to lower tax credit revenue.

Current wording

Workforce Solutions revenue increased by 7% and 5% in the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The increase in revenue for the third quarter is due to an increase in both non-mortgage and mortgage verticals within Verification Services. The increase for the first nine months is due to an increase in non-mortgage verticals within Verification Services, partially offset by declines in mortgage revenue. The increase for both periods is partially offset by declines in Employer Services.

Previous wording

Revenue increased by 9% and increased 7% for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The increase in revenue for both periods is primarily due to growth in the government and talent verticals, partially offset by declines in the mortgage vertical.

Current wording

Revenue increased by 14% and 9% for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The increase in revenue for both periods is primarily due to growth in the government and talent verticals. The increase in the first nine months of 2024 is partially offset by declines in the mortgage vertical.

Previous wording

Revenue decreased by 11% and 10% in the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The decrease in revenue for both periods is primarily due to lower Employee Retention Credit ("ERC")

Current wording

Revenue decreased by 19% and 13% in the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The decrease in revenue for both periods is primarily due to lower Employee Retention Credit ("ERC") revenue and declines in I-9 and onboarding services. The ERC revenue decrease is driven by the wind down of the program, accelerated by the IRS pausing new claims processing during the third quarter of 2023.

Previous wording

Operating margin increased to 44.5% for the second quarter of 2024 from 42.0% for the second quarter of 2023, and increased to 43.4% for the first six months of 2024 from 41.8% for the first six months of 2023. The increased margin for both periods is due to the aforementioned increase in revenue.

Current wording

Operating margin increased to 43.2% for the third quarter of 2024 from 41.8% for the third quarter of 2023, and increased to 43.3% for the first nine months of 2024 from 41.8% for the first nine months of 2023. The increased margin for both periods is due to the aforementioned increase in revenue.

Previous wording

USIS revenue increased by 7% and 9% for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The increase for both periods is due to growth in mortgage related online services, as well as growth in Mortgage Solutions and consumer solutions revenue. Growth in mortgage related online revenue and Mortgage Solutions was due to both increased product prices and increased mortgage prequalification credit inquiry revenue.

Current wording

USIS revenue increased by 12% and 10% for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The increase for both periods is due to growth in mortgage related online services, as well as growth in Mortgage Solutions, consumer solutions revenue, and Financial Marketing Services. Growth in mortgage related online services and Mortgage Solutions is due to both product pricing as well as higher mortgage credit inquiries.

Previous wording

Revenue increased by 5% and 8% for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The increase for both periods is driven by higher mortgage revenue due to increased product prices and higher mortgage prequalification credit inquiry revenue, as well as continued growth of consumer solutions revenue.

Current wording

Revenue increased by 9% for both the third quarter and first nine months of 2024 compared to the same periods in 2023. The increase for both periods is driven by higher mortgage related online services due to product pricing and higher mortgage credit inquiries, as well as continued growth of consumer solutions revenue.

Previous wording

Revenue increased by 33% and 23% in the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The increase in both periods is due to both increased product prices and higher mortgage prequalification credit inquiry revenue.

Current wording

Revenue increased by 39% and 28% in the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The increase in both periods is due to both product pricing and higher mortgage credit inquiries.

Previous wording

Revenue increased by 7% and 3% for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The increase for both periods is driven by growth in credit marketing services.

Current wording

Revenue increased by 14% and 7% for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The increase for both periods is driven by growth in credit marketing services and risk and data services.

Previous wording

USIS operating margin decreased to 20.6% for the second quarter of 2024 from 23.1% for the second quarter of 2023 and decreased to 20.3% for the first six months of 2024 from 20.9% for the first six months of 2023. The margin decrease for both periods is due to an increase in operating expenses, partially offset by an increase in revenue. The increase in operating expenses in both periods is primarily due to increased royalty expenses, particularly in the mortgage vertical, increased amortization of capitalized internal-use software and system costs from technology transformation capital spending incurred previously, and third party cloud usage fees.

Current wording

USIS operating margin decreased to 20.6% for the third quarter of 2024 from 21.1% for the third quarter of 2023 and decreased to 20.4% for the first nine months of 2024 from 21.0% for the first nine months of 2023. The margin decrease for both periods is due to an increase in operating expenses, partially offset by an increase in revenue. The increase in operating expenses in both periods is primarily due to increased royalty expenses, particularly in the mortgage vertical, higher costs of purchased data, and increased amortization of capitalized internal-use software from technology transformation capital spending incurred previously.

Previous wording

International revenue increased by 17% and 15% in the second quarter and the first six months of 2024, respectively, compared to the same periods in 2023. On a local currency basis, revenue increased by 28% and 24% in the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The increase in both periods is driven by Latin America, primarily due to revenue from the BVS acquisition and local currency growth in Argentina, as well as growth in Europe and Canada, partially offset by a decline in Australia. Local currency fluctuations against the U.S. dollar negatively impacted revenue by $32.2 million, or 11%, for the second quarter of 2024, and by $52.3 million, or 9%, for the first six months of 2024.

Current wording

International revenue increased by 9% and 13% in the third quarter and the first nine months of 2024, respectively, compared to the same periods in 2023. On a local currency basis, revenue increased by 18% and 22% in the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The increase in both periods is driven by Latin America, primarily due to revenue from the BVS acquisition and local currency growth in Argentina, as well as growth in Europe. The increase in the first nine months of 2024 is also due to growth in Canada, partially offset by a decline in Australia. Local currency fluctuations against the U.S. dollar negatively impacted revenue by $26.7 million, or 9%, for the third quarter of 2024, and by $79.0 million, or 9%, for the first nine months of 2024.

Previous wording

On a local currency basis, revenue increased by 124% and 113% for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The increase in both periods is primarily due to revenue from the BVS acquisition, which was $41.2 million and $82.4 millionin the second quarter and first six months of 2024, respectively, as well as from local currency growth in Argentina. Local currency fluctuations against the U.S. dollar negatively impacted revenue by $30.1 million, or 53%, and $50.6 million, or 45%, for the second quarter and first six months of 2024, respectively, primarily in Argentina and Chile. Reported revenue increased by 71% and 68% for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023.

Current wording

On a local currency basis, revenue increased by 58% and 90% for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The increase in both periods is primarily due to revenue from the BVS acquisition, which occurred in August of 2023, as well as local currency growth in Argentina. Revenue from the BVS acquisition was$38.1 million and $120.4 million in the third quarter and first nine months of 2024, respectively, compared to $23.4 million in the third quarter and first nine months of 2023. Local currency fluctuations against the U.S. dollar negatively impacted revenue by $29.6 million, or 37%, and $80.1 million, or 42%, for the third quarter and first nine months of 2024, respectively, primarily in Argentina and Brazil. Reported revenue increased by 21% and 48% for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023.

Previous wording

On a local currency basis, revenue increased by 12% and 11% for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The increase in both periods is primarily due to growth in the debt services and credit reporting businesses in the U.K. Local currency fluctuations against the U.S. dollar positively impacted revenue by $0.4 million, or less than 1%, and $3.6 million, or 2%, for the second quarter and first six months of 2024, respectively. Reported revenue increased by 12% and 13% for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023.

Current wording

On a local currency basis, revenue increased by 9% and 10% for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The increase for both periods is primarily due to growth in the debt services and credit reporting businesses in the U. K. Local currency fluctuations against the U.S. dollar positively impacted revenue by $2.4 million, or 2%, and $5.9 million, or 2%, for the third quarter and first nine months of 2024, respectively.

Previous wording

On a local currency basis, revenue decreased by 2% and 6% for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. The decrease in both periods is primarily driven by Australia due to declines in the commercial and consumer credit reporting businesses. Local currency fluctuations against the U.S. dollar negatively impacted revenue by $1.2 million, or 2%, and $4.2 million, or 2%, for the second quarter and first six months of 2024, respectively. Reported revenue decreased by 4% and 8% for the second quarter and first six months of 2024, respectively, compared to the same periods in 2023.

Current wording

On a local currency basis, revenue increased by 2% and decreased by 3% for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. The increase in the third quarter is primarily driven by growth in the Australia commercial and consumer credit reporting businesses. The decrease in the first nine months is primarily driven by Australia due to declines in the commercial, direct to consumer, and consumer credit reporting businesses in the first half of the year. Local currency fluctuations against the U.S. dollar positively impacted revenue by $1.6 million, or 2% for the third quarter, and negatively impacted revenue by $2.6 million, or 1%, for the first nine months of 2024, respectively. Reported revenue increased by 4% and decreased by 4% for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023.

Previous wording

On a local currency basis, revenue increased by 6% and 5% in the second quarter and first six months of 2024, respectively, compared to the same periods in 2023. Revenue growth in both periods is driven by growth in the direct to consumer and the consumer credit reporting businesses. Local currency fluctuations against the U.S. dollar negatively impacted revenue by $1.3 million, or 2%, and $1.1 million or 1%, for the second quarter and first six months of 2024, respectively. Reported revenue increased by 4% for both the second quarter and first six months of 2024 compared to the same periods in 2023.

Current wording

On a local currency basis, revenue increased by 1% and 4% in the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023. Revenue growth in both periods is driven by growth in the direct to consumer business. Local currency fluctuations against the U.S. dollar negatively impacted revenue by $1.1 million, or 1%, and $2.2 million or 1%, for the third quarter and first nine months of 2024, respectively. Reported revenue was flat and increased by 3% for the third quarter and first nine months of 2024, respectively, compared to the same periods in 2023.

Previous wording

Operating margin was flat at 11.9% for both the second quarter of 2024 and the second quarter of 2023 and decreased to 10.9% for the first six months of 2024 from 11.7% for the first six months of 2023. The margin decrease for the first six months of 2024 compared to the first six months of 2023 is due to higher amortization costs, principally due to higher amortization of purchased intangible assets related to the BVS acquisition.

Current wording

Operating margin increased to 13.9% for the third quarter of 2024 from 12.7% for the third quarter of 2023 and was flat at 12.0% for the first nine months of 2024 and 2023. The increased margin for the third quarter is due to the aforementioned increase in revenue. Margin was flat for the first nine months due to the aforementioned increase in revenue, offset by amortization costs, principally due to higher amortization of purchased intangible assets related to the BVS acquisition.

Previous wording

Funds generated by operating activities, our $1.5 billion five-year unsecured revolving credit facility ("Revolver") and related commercial paper ("CP") program, more fully described below, are our most significant sources of liquidity. At June 30, 2024, we had $181.9 million in cash and cash equivalents, as well as $1,499.6 million available to borrow under our Revolver.

Current wording

Funds generated by operating activities, our $1.5 billion five-year unsecured revolving credit facility ("Revolver") and related commercial paper ("CP") program, more fully described below, are our most significant sources of liquidity. At

Previous wording

Fund Transfer Limitations. The ability of certain of our subsidiaries and associated companies to transfer funds to the U.S. may be limited, in some cases, by certain restrictions imposed by foreign governments. These restrictions do not, individually or in the aggregate, materially limit our ability to service our indebtedness, meet our current obligations or pay dividends. As of June 30, 2024, we held $157.6 million of cash in our foreign subsidiaries.

Current wording

Fund Transfer Limitations. The ability of certain of our subsidiaries and associated companies to transfer funds to the U.S. may be limited, in some cases, by certain restrictions imposed by foreign governments. These restrictions do not, individually or in the aggregate, materially limit our ability to service our indebtedness, meet our current obligations or pay dividends. As of September 30, 2024, we held $180.5 million of cash in our foreign subsidiaries.

Previous wording

Information about our cash flows, by category, is presented in the Consolidated Statements of Cash Flows. The following table summarizes our cash flows for the six months ended June 30, 2024 and 2023:

Current wording

Information about our cash flows, by category, is presented in the Consolidated Statements of Cash Flows. The following table summarizes our cash flows for the nine months ended September 30, 2024 and 2023:

Previous wording

Cash provided by operating activities in the six months ended June 30, 2024 increased by $107.2 million compared to the prior year period primarily due to improved net income and changes in our working capital position.

Current wording

Cash provided by operating activities in the nine months ended September 30, 2024 increased by $205.0 million compared to the prior year period primarily due to changes in our working capital position.

Previous wording

Capital expenditures paid in the first six months of 2024 decreased by $52.7 million from the same period in 2023 due to lower capitalized software costs and lower spending on technology infrastructure as compared to the first six months of 2023 as we continue to make progress toward completion of our technology transformation.

Current wording

Capital expenditures paid in the first nine months of 2024 decreased by $63.0 million from the same period in 2023 due to lower capitalized software costs and lower spending on technology infrastructure as compared to the first nine months of 2023 as we continue to make progress toward completion of our technology transformation.

Previous wording

We have access to a $1.5 billion five-year unsecured revolving credit facility (Revolver), which matures in August 2027, and a $700.0 million delayed draw term loan ("Term Loan"), which matures in August 2026, collectively known as the “Senior Credit Facilities.” Borrowings under the Senior Credit Facilities may be used for working capital, for capital expenditures, to refinance existing debt, to finance acquisitions and for other general corporate purposes. The Revolver includes an option to request a maximum of three one-year extensions of the maturity date any time after the first anniversary of the closing date of the Revolver. In May 2024, we exercised our first option to extend the maturity date by one year, from August 2026 to August 2027, and amended the Revolver agreement to replace a discontinued reference rate for Canadian Dollar-denominated commitments. Availability of the Revolver is reduced by the outstanding principal balance of our CP notes and by any letters of credit issued under the Revolver.

Current wording

We have access to a $1.5 billion five-year unsecured revolving credit facility ("Revolver"), which matures in August 2027. Borrowings under the Revolver may be used for working capital, for capital expenditures, to refinance existing debt, to finance acquisitions and for other general corporate purposes. The Revolver includes an option to request a maximum of three one-year extensions of the maturity date any time after the first anniversary of the closing date of the Revolver. In May 2024, we exercised our first option to extend the maturity date by one year, from August 2026 to August 2027, and amended the Revolver agreement to replace a discontinued reference rate for Canadian Dollar-denominated commitments. Availability of the Revolver is reduced by the outstanding principal balance of our CP notes and by any letters of credit issued under the Revolver.

Previous wording

As of June 30, 2024, there were $0.4 million of letters of credit outstanding, no outstanding borrowings under the Revolver, $686.9 million outstanding under the Term Loan, and no outstanding CP notes. Availability under the Revolver was $1,499.6 million at June 30, 2024.

Current wording

As of September 30, 2024, there were no outstanding CP notes, $1.4 million of letters of credit outstanding, and no outstanding borrowings under the Revolver. Availability under the Revolver was $1,498.6 million at September 30, 2024.