FACTSET RESEARCH SYSTEMS INC
For the period ended Feb 28, 2025. Filed Apr 4, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Feb 28, 2025 · Filed Apr 4, 2025
FDS$327.89-3.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-11-30; filed 2025-01-08.
0001013237-25-000010
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-02-28; filed 2025-04-04.
0001013237-25-000051
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 185 previous paragraphs and 214 current paragraphs.
105 unchanged; 65 reworded; 41 added; 13 removed; 2 previous and 3 current paragraphs rearranged.
Tables are not compared: 13 previous and 13 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (41)
Current report
Fiscal 2025 Second Quarter in Review
Current report
Operating margin was 32.5% for the second quarter of fiscal 2025, compared to 33.3% in the prior year period. When expenses are expressed as a percentage of revenues, this decrease in operating margin was mainly due to higher professional fees and computer-related expenses, partially offset by growth in revenues and a decrease in employee compensation costs. Diluted earnings per common share ("Diluted EPS") was $3.76 for the second quarter of fiscal 2025, an increase of 3.0% from the comparable prior year period, primarily driven by higher operating income.
Current report
Revenues for the three months ended February 28, 2025 were $570.7 million, an increase of 4.5%. This 4.5% growth in revenues was driven by a 4.0% increase in organic revenues, which totaled $568.0 million for the three months ended February 28, 2025, and a 0.7% increase from acquisition-related revenues, partially offset by a net decrease of 0.2% from foreign currency exchange rate fluctuations. Revenues increased in all our segments, primarily in the Americas. The increase in revenues was primarily driven by workstations and, to a lesser extent, CGS.
Current report
Revenues for the six months ended February 28, 2025 were $1,139.3 million, an increase of 4.7%. This 4.7% growth in revenues was driven by a 4.4% increase in organic revenues, which totaled $1,135.7 million for the six months ended February 28, 2025, and a 0.4% increase from acquisition-related revenues, partially offset by a net decrease of 0.1% from foreign currency exchange rate fluctuations. Revenues increased in all our segments, primarily in the Americas. The increase in revenues was mainly from workstations and, to a lesser extent, CGS and data solutions.
Current report
Americas revenues increased 4.8% to $369.7 million during the three months ended February 28, 2025, compared with $352.6 million from the same period a year ago. This 4.8% growth in revenues was driven by a 4.0% increase in organic revenues and a 0.9% increase from acquisition-related revenues, partially offset by a net decrease of 0.1% from foreign currency exchange rate fluctuations. The increase in revenues was driven by workstations, CGS and front office solutions.
Current report
EMEA revenues increased 3.0% to $143.4 million during the three months ended February 28, 2025, compared with $139.2 million from the same period a year ago. This 3.0% growth in revenues was driven by a 3.1% increase in organic revenues and a 0.3% increase from acquisition-related revenues, partially offset by a net decrease of 0.4% from foreign currency exchange rate fluctuations. The increase in revenues was mainly from CGS, data solutions and middle office solutions.
Current report
Revenues from the Americas increased 5.1% to $736.9 million during the six months ended February 28, 2025, compared with $701.0 million from the same period a year ago. This 5.1% growth in revenues was driven by a 4.6% increase in organic revenues and a 0.6% increase from acquisition-related revenues, partially offset by a net decrease of 0.1% from foreign currency exchange rate fluctuations. The increase in revenues was driven by workstations and, to a lesser extent, CGS and front office solutions.
Current report
Revenues from Asia Pacific increased 6.3% to $115.3 million during the six months ended February 28, 2025, compared with $108.4 million from the same period a year ago. This 6.3% growth in revenues was driven by a 6.5% increase in organic revenues and a 0.1% increase from acquisition-related revenues, partially offset by a 0.3% decrease from foreign currency exchange rate fluctuations. The increase in revenues was driven by data solutions and workstations.
Current report
Cost of services, when expressed as a percentage of revenues, was 47.2% for the three months ended February 28, 2025, an increase of 50 basis points compared with the same period a year ago. This increase was primarily due to higher computer-related expenses, amortization of intangible assets and other expenses included in Cost of services, partially offset by a decrease in employee compensation costs.
Current report
•Computer-related expenses increased by 120 basis points, primarily driven by higher spend related to cloud-based hosting services and licensed software arrangements.
Current report
Cost of services increased 4.3% to $528.4 million for the six months ended February 28, 2025, compared with $506.8 million in the same period a year ago, primarily due to an increase in amortization of intangible assets and computer-related expenses, partially offset by a decrease in employee compensation costs.
Current report
•Employee compensation costs decreased 190 basis points, primarily due to a decrease in restructuring charges, partially offset by an increase in variable compensation costs.
Current report
•Amortization of intangible assets increased 100 basis points, mainly due to higher amortization from capitalized costs related to the development of our internal-use software.
Current report
•Professional fees increased by 140 basis points, mainly due to acquisition-related costs.
Current report
•Bad debt expense decreased by 50 basis points, primarily due to improved client collections.
Current report
SG&A expenses increased 11.3% to $234.1 million for the six months ended February 28, 2025, compared with $210.4 million for the same period a year ago, primarily driven by higher professional fees and employee compensation costs.
Current report
SG&A expenses, when expressed as a percentage of revenues, were 20.5% for the six months ended February 28, 2025, an increase of 120 basis points compared with the same period a year ago. This increase was primarily due to higher professional fees and employee compensation costs.
Current report
•Professional fees increased by 110 basis points, mainly due to acquisition-related costs.
Current report
•Employee compensation costs increased by 40 basis points, mainly due to an increase in variable compensation costs.
Current report
Operating income increased 2.0% to $185.5 million for the three months ended February 28, 2025, compared with $181.9 million in the prior year period. This increase was primarily driven by growth in revenues, partially offset by an increase in professional fees, computer-related expenses and amortization of intangible assets. Based on the operating income for the three months ended February 28, 2025, comparing the average foreign currency exchange rates for the three months ended February 28, 2025 to the rates for the three months ended February 29, 2024, net of hedge activity, resulted in an increase in operating income of $1.3 million.
Current report
Operating income increased 1.6% to $376.8 million for the six months ended February 28, 2025, compared with $371.0 million in the prior year period. This increase was primarily due to growth in revenues, partially offset by higher amortization of intangible assets, professional fees and computer-related expenses. Based on the operating income for the six months ended February 28, 2025, comparing the average foreign currency exchange rates for the six months ended February 28, 2025 to the rates for the six months ended February 29, 2024, net of hedge activity, resulted in an increase in operating income of $0.2 million.
Current report
Operating Income by Segment
Current report
Americas operating income decreased 10.5% to $73.1 million during the three months ended February 28, 2025, compared with $81.7 million in the same period a year ago. This decrease was primarily due to higher professional fees, computer-related expenses and amortization of intangible assets, partially offset by growth in revenues of 4.8%.
Current report
•Professional fees increased mainly due to acquisition-related costs.
Current report
•Computer-related expenses increased primarily due to higher spend related to cloud-based hosting services and licensed software arrangements.
Current report
•Amortization of intangible assets increased mainly due to higher amortization from capitalized costs related to the development of our internal-use software.
Current report
EMEA
Current report
Asia Pacific operating income increased 11.8% to $41.8 million during the three months ended February 28, 2025, compared with $37.4 million in the same period a year ago. This increase was mainly due to growth in revenues of 6.4%, partially offset by an increase in employee compensation costs primarily due to higher variable compensation costs and annual base salaries. The increase in annual base salaries was primarily driven by annual merit increases and a net headcount increase of 162 employees.
Current report
Americas operating income decreased 4.7% to $154.9 million during the six months ended February 28, 2025, compared with $162.6 million in the same period a year ago. This decrease was primarily due to higher amortization of intangible assets, professional fees and computer-related expenses, partially offset by growth in revenues of 5.1%.
Current report
•Amortization of intangible assets increased mainly due to higher amortization from capitalized costs related to the development of our internal-use software.
Current report
•Professional fees increased mainly due acquisition-related costs.
Current report
•Computer-related expenses increased primarily due to higher spend related to licensed software arrangements and cloud-based hosting services.
Current report
EMEA
Current report
EMEA operating income increased 6.0% to $139.6 million during the six months ended February 28, 2025, compared with $131.7 million in the same period a year ago. This increase was primarily due to growth in revenues of 3.0% and a decrease in employee compensation expense. Employee compensation costs decreased primarily due to lower variable compensation costs and payroll taxes, partially offset by an increase in annual base salaries driven by annual merit increases and a net headcount increase of 44 employees.
Current report
Our effective tax rate for the three months ended February 28, 2025 was 15.9%, compared with 16.4% for the three months ended February 29, 2024. This decrease was primarily due to lower U.S. tax on foreign earnings, partially offset by certain discrete items, mainly lower excess tax benefits related to stock-based compensation.
Current report
Our effective tax rate for the six months ended February 28, 2025 was 16.2%, compared with 15.8% for the six months ended February 29, 2024. This increase was primarily due to lower excess tax benefits related to stock-based compensation, partially offset by lower U.S. tax on foreign earnings.
Current report
(4)Related to the accelerated vesting of stock awards for certain employees.
Current report
During the six months ended February 28, 2025, we borrowed $305.0 million and repaid $75.0 million for total net borrowings of $230.0 million under the 2022 Revolving Facility. As of February 28, 2025, the outstanding borrowings under the 2022 Revolving Facility were $480.0 million.
Current report
Liquid Holdings, LLC ("LiquidityBook")
Current report
On February 7, 2025 we completed the acquisition of LiquidityBook for a purchase price of $243.8 million, net of cash acquired, and inclusive of preliminary working capital adjustments. The purchase price includes contingent consideration of $11.9 million which reflects the acquisition date fair value of potential future payments that are contingent upon the achievement of certain specified milestones. LiquidityBook provides cloud-native trading solutions to hedge fund, asset and wealth management, outsourced trading, and sell-side middle office clients. LiquidityBook operates a proprietary FIX network that enables streamlined connectivity to over 200 brokers and order routing to more than 1,600 destinations across 80 markets globally. This acquisition adds technology-forward order management and investment book of record capabilities and enhances FactSet’s ability to serve the integrated workflow needs of clients across the portfolio life cycle.
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Removed paragraphs (13)
Previous report
Fiscal 2025 First Quarter in Review
Previous report
Revenues for the three months ended November 30, 2024 were $568.7 million, an increase of 4.9%. This 4.9% growth in revenues was driven by a 4.7% increase in organic revenues, which totaled $567.7 million for the three months ended November 30, 2024, a 0.1% increase from acquisition-related revenues and a net increase of 0.1% from foreign currency exchange rate fluctuations. Revenues increased in all our segments, primarily in the Americas. The increase in revenues was driven by higher demand and price increases primarily from workstations, CGS and data solutions.
Previous report
Americas
Previous report
Asia Pacific
Previous report
Asia Pacific revenues increased 6.3% to $57.7 million during the three months ended November 30, 2024, compared with $54.3 million from the same period a year ago. This growth in revenues was reflective of a 6.2% increase in organic revenues and a 0.1% increase from acquisition-related revenues. The increase in revenues was driven by higher demand and price increases primarily from workstations and data solutions.
Previous report
•Employee compensation costs increased by 100 basis points, primarily driven by an increase in variable compensation costs, higher restructuring charges (as the prior year benefited from the release of certain severance-related accruals) and an increase in employee-benefit costs driven by lower capitalized SG&A expenses associated with the development of our internal-use software.
Previous report
•Professional fees increased by 70 basis points mainly due to costs incurred in connection with the acquisition of Irwin.
Previous report
Operating income increased 1.2% to $191.3 million for the three months ended November 30, 2024, compared with $189.0 million in the prior year period. This increase was primarily driven by growth in revenues, partially offset by an increase in amortization of intangible assets, employee compensation costs and professional fees. Foreign currency exchange rate fluctuations, netof hedge activity, decreased operating income by $1.1 million for the three months ended November 30, 2024 compared with the three months ended November 30, 2023.
Previous report
Americas
Previous report
Americas operating income increased 1.2% to $81.8 million during the three months ended November 30, 2024, compared with $80.8 million in the same period a year ago. This increase was primarily due to growth in revenues of 5.4%, partially offset by higher amortization of intangible assets and employee compensation costs. Amortization of intangible assets increased mainly due to higher amortization from increased capitalized costs related to the development of our internal-use software. Employee compensation costs increased primarily due to higher variable compensation costs.
Previous report
Asia Pacific
Previous report
Our effective tax rate for the three months ended November 30, 2024 was 16.5%, compared with 15.2% for the three months ended November 30, 2023. This increase was primarily due to the revaluation of a deferred tax asset associated with a foreign tax rate change.
Previous report
We used the March 1, 2022 borrowings, along with the net proceeds from the issuance of the Senior Notes (as defined below) and cash on hand, to finance the consideration for the CGS acquisition, to repay prior outstanding borrowings and to pay related transaction fees, costs and expenses.
Reworded paragraphs (65)
Previous wording
Our platform delivers expansive data, sophisticated analytics, and flexible technology used by global financial professionals to power their critical investment workflows. As of November 30, 2024, we had more than 8,200 clients comprised of over 218,000 investment professionals, including institutional asset managers, bankers, wealth managers, asset owners, partners, hedge funds, corporate users, and private equity and venture capital professionals. Our revenues are primarily derived from subscriptions to our multi-asset class data and solutions powered by our connected data and technology platform. Our products and services include workstations, portfolio analytics and enterprise data solutions. We also offer managed services that operate as an extension of our clients' internal teams to support data, performance, risk and reporting workflows.
Current wording
Our platform delivers expansive data, sophisticated analytics, and flexible technology used by global financial professionals to power their critical investment workflows. As of February 28, 2025, we had more than 8,600 clients comprised of over 219,000 investment professionals, including institutional asset managers, bankers, wealth managers, asset owners, partners, hedge funds, corporate users, and private equity and venture capital professionals. Our revenues are primarily derived from subscriptions to our multi-asset class data and solutions powered by our connected data and technology platform. Our products and services include workstations, portfolio analytics and enterprise data solutions. We also offer managed services that operate as an extension of our clients' internal teams to support data, performance, risk and reporting workflows.
Previous wording
Revenues in the first quarter of fiscal 2025 were $568.7 million, an increase of 4.9% from the comparable prior year period. This 4.9% growth in revenues was driven by a 4.7% increase in organic revenues, a 0.1% increase from acquisition-related revenues and a net increase of 0.1% from foreign currency exchange rate fluctuations. Revenues increased in all our segments, primarily in the Americas. Revenues increased due to higher demand and price increases primarily from workstations, CGS and data solutions. Refer to Part I, Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations, Non-GAAP Financial Measures, of this Quarterly Report on Form 10-Q for a definition of organic revenues and a reconciliation between revenues and organic revenues.
Current wording
Revenues in the second quarter of fiscal 2025 were $570.7 million, an increase of 4.5% from the comparable prior year period. This 4.5% growth in revenues was driven by a 4.0% increase in organic revenues and a 0.7% increase from acquisition-related revenues, partially offset by a net decrease of 0.2% from foreign currency exchange rate fluctuations. Revenues increased in all our segments, primarily in the Americas. Revenues increased primarily from workstations and CGS. Refer to Part I, Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations, Non-GAAP Financial Measures, of this Quarterly Report on Form 10-Q for the definition of organic revenues and a reconciliation between revenues and organic revenues.
Previous wording
As of November 30, 2024, organic annual subscription value ("Organic ASV") totaled $2,258.8 million, an increase of 4.5% over the prior year. Organic ASV increased in all our segments, with the majority of the increase in the Americas. The Organic ASV increase was driven by higher demand and price increases primarily from workstations and, to a lesser extent, CGS. Refer to Part I, Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations, Annual Subscription Value, of this Quarterly Report on Form 10-Q for the definitions of Organic ASV.
Current wording
As of February 28, 2025, organic annual subscription value ("Organic ASV") totaled $2,276.2 million, an increase of 4.1% over the prior year. Organic ASV increased in all our segments, with the majority of the increase in the Americas. The Organic ASV increase was mainly from workstations and, to a lesser extent, CGS. Refer to Part I, Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations, Annual Subscription Value, of this Quarterly Report on Form 10-Q for the definition of Organic ASV.
Previous wording
We returned $88.0 million to our stockholders in the form of share repurchases and dividends during the three months ended November 30, 2024.
Current wording
We returned $104.0 million to our stockholders in the form of share repurchases and dividends during the three months ended February 28, 2025.
Previous wording
As of November 30, 2024, our client and user count was 8,249 and 218,267, respectively. Our employee headcount was 12,575 as of November 30, 2024, up 0.5% compared to the prior year. This increase was driven by net headcount growth of 1.4% in Asia Pacific and 0.3% in EMEA, while the Americas experienced a net headcount reduction of 2.6%.
Current wording
As of February 28, 2025, our client and user count was 8,645 and 219,141, respectively. Our employee headcount was 12,598 as of February 28, 2025, up 2.6% compared to the prior year. This increase was driven by net headcount growth of 4.8% in Americas, 3.1% in EMEA and 1.9% in Asia Pacific.
Previous wording
Beginning in fiscal 2025, we are reporting Organic ASV, rather than Organic ASV plus professional services, to focus on the recurring nature of our revenues. This underscores the shift of FactSet's offerings toward providing more managed services and less project-based services.
Current wording
Beginning in fiscal 2025, we are reporting Organic ASV, rather than Organic ASV plus professional services, to focus on the recurring nature of our revenues. This underscores the shift of our offerings toward providing more managed services and less project-based services.
Previous wording
As of November 30, 2024, Organic ASV was $2,258.8 million, an increase of 4.5% compared with November 30, 2023. Organic ASV increased in all our segments, with the majority of the increase in the Americas. The increase in Organic ASV was driven by higher sales to existing clients, price increases to existing clients and sales to new clients, partially offset by existing client cancellations. These higher sales and price increases were primarily attributable to workstations and, to a lesser extent, CGS.
Current wording
As of February 28, 2025, Organic ASV was $2,276.2 million, an increase of 4.1% compared with February 29, 2024. Organic ASV increased in all our segments, with the majority of the increase in the Americas. The increase in Organic ASV was driven by higher sales to existing clients, price increases to existing clients and sales to new clients, partially offset by existing client cancellations. More specifically, the increase in Organic ASV was mainly from workstations and, to a lesser extent, CGS.
Previous wording
As of November 30, 2024, ASV from the Americas represented 65% of total ASV and was $1,464.5 million, an increase from $1,393.1 million as of November 30, 2023. Americas Organic ASV was $1,456.4 million as of November 30, 2024, a 4.5% increase from the prior year period. The Organic ASV increase in the Americas was driven by higher demand and price increases primarily from workstations and, to a lesser extent, CGS.
Current wording
As of February 28, 2025, ASV from the Americas represented 65% of total ASV and was $1,501.1 million, an increase from $1,413.6 million as of February 29, 2024. Americas Organic ASV was $1,474.9 million as of February 28, 2025, a 4.4% increase from the prior year period. The Organic ASV increase in the Americas was primarily driven by workstations and, to a lesser extent, CGS.
Previous wording
As of November 30, 2024, ASV from EMEA represented 25% of total ASV and was $572.4 million, an increase from $551.7 million as of November 30, 2023. EMEA Organic ASV was $572.4 million as of November 30, 2024, a 3.6% increase from the prior year period. The EMEA Organic ASV increase was driven by higher demand and price increases mainly from middle office solutions, data solutions and CGS.
Current wording
As of February 28, 2025, ASV from EMEA represented 25% of total ASV and was $571.3 million, an increase from $556.5 million as of February 29, 2024. EMEA Organic ASV was $571.4 million as of February 28, 2025, a 2.6% increase from the prior year period. The EMEA Organic ASV increase was mainly from CGS and data solutions.
Previous wording
As of November 30, 2024, ASV from Asia Pacific represented 10% of total ASV and was $229.0 million, an increase from $214.6 million as of November 30, 2023. Asia Pacific Organic ASV was $230.0 million as of November 30, 2024, a 7.0% increase from the prior year period. The Asia Pacific Organic ASV increase was driven by higher demand and price increases primarily from data solutions and workstations.
Current wording
As of February 28, 2025, ASV from Asia Pacific represented 10% of total ASV and was $233.7 million, an increase from $215.5 million as of February 29, 2024. Asia Pacific Organic ASV was $229.9 million as of February 28, 2025, a 6.8% increase from the prior year period. The Asia Pacific Organic ASV increase was primarily driven by workstations and data solutions.
Previous wording
The buy-side and sell-side Organic ASV annual growth rates as of November 30, 2024 were 4.3% and 3.5%, respectively. Buy-side clients account for approximately 82% of our Organic ASV, consistent with the prior year period, and primarily include institutional asset managers, wealth managers, asset owners, partners, hedge funds and corporate clients. The remaining Organic ASV is derived from sell-side firms, primarily including broker-dealers, banking and advisory firms, and private equity and venture capital firms.
Current wording
The buy-side and sell-side Organic ASV annual growth rates as of February 28, 2025 were 4.1% and 2.2%, respectively. Buy-side clients account for approximately 82% of our Organic ASV, consistent with the prior year period, and primarily include institutional asset managers, wealth managers, asset owners, partners, hedge funds and corporate clients. The remaining
Previous wording
(1)The client count includes clients with ASV of $10,000 and above.
Current wording
(1)The client count includes clients with ASV of $10,000 and above and does not reflect the acquisition of Liquid Holdings, LLC ("LiquidityBook").
Previous wording
(2)The client and user count does not reflect the acquisition of Platform Group Limited ("Irwin").
Current wording
(2)The user count does not reflect the Platform Group Limited ("Irwin") and LiquidityBook acquisitions.
Previous wording
Our total client count was 8,249 as of November 30, 2024, a net increase of 3.8% or 304 clients in the last 12 months, mainly due to an increase in corporate clients and wealth management clients.
Current wording
Our total client count was 8,645 as of February 28, 2025, a net increase of 7.8% or 625 clients in the last 12 months, mainly due to an increase in corporates, which now includes clients from the Irwin acquisition, and wealth management clients.
Previous wording
As of November 30, 2024, there were 218,267 professionals using FactSet, representing a net increase of 5.4% or 11,184 users in the last 12 months, primarily driven by an increase in wealth users.
Current wording
As of February 28, 2025, there were 219,141 professionals using FactSet, representing a net increase of 6.1% or 12,663 users in the last 12 months, primarily driven by an increase in wealth management users.
Previous wording
Annual ASV retention was greater than 95% of ASV for the period ended November 30, 2024 and November 30, 2023. When expressed as a percentage of clients, annual retention was 91% for the period ended November 30, 2024, compared with 90% for the period ended November 30, 2023.
Current wording
Annual ASV retention was greater than 95% of ASV as of February 28, 2025 and February 29, 2024. When expressed as a percentage of clients, annual retention was 91% as of February 28, 2025, compared with 90% as of February 29, 2024.
Previous wording
As of November 30, 2024, our net employee headcount increased by 0.5% to 12,575, compared with 12,515 employees as of November 30, 2023. This net headcount growth was primarily driven by an increase in employees based in India, as a result of our continued investment in our centers of excellence ("COEs"). Approximately 68% of our employees are located in our COEs.
Current wording
As of February 28, 2025, our net employee headcount increased by 2.6% to 12,598, compared with 12,279 employees as of February 29, 2024. This net headcount growth was primarily driven by our Irwin and LiquidityBook acquisitions and an increase in employees based in India as a result of our continued investment in our centers of excellence ("COEs"). Approximately 67% of our employees are located in our COEs.
Previous wording
As of November 30, 2024, compared to November 30, 2023, our net headcount growth was 1.4% in Asia Pacific and 0.3% in EMEA, while the Americas experienced a net headcount reduction of 2.6%. As of November 30, 2024, we had 8,715 employees located in Asia Pacific, 2,436 in the Americas and 1,424 in EMEA.
Current wording
As of February 28, 2025, compared to February 29, 2024, our net headcount growth was 4.8% in the Americas, 3.1% in EMEA and 1.9% in Asia Pacific. As of February 28, 2025, we had 8,681 employees located in Asia Pacific, 2,475 in the Americas and 1,442 in EMEA.
Previous wording
For an understanding of the significant factors that influenced our performance for the three months ended November 30, 2024 and November 30, 2023, the following discussion should be read in conjunction with the Consolidated Financial Statements and related Notes presented in Part I, Item 1. in this Quarterly Report on Form 10-Q.
Current wording
For an understanding of the significant factors that influenced our performance for the three and six months ended February 28, 2025 and February 29, 2024, the following discussion should be read in conjunction with the Consolidated Financial Statements and related Notes presented in Part I, Item 1. in this Quarterly Report on Form 10-Q.
Previous wording
Americas revenues increased 5.4% to $367.2 million during the three months ended November 30, 2024, compared with $348.3 million from the same period a year ago. This growth in revenues was reflective of a 5.2% increase in organic revenues and a 0.2% increase from acquisition-related revenues. The increase in revenues was driven by higher demand and price increases primarily from workstations and, to a lesser extent, CGS.
Current wording
Asia Pacific revenues increased 6.4% to $57.6 million during the three months ended February 28, 2025, compared with $54.1 million from the same period a year ago. This growth in revenues was driven by a 6.8% increase in organic revenues and a 0.2% increase from acquisition-related revenues, partially offset by a net decrease of 0.6% from foreign currency exchange rate fluctuations. The increase in revenues was driven by data solutions and workstations.
Previous wording
EMEA revenues increased 3.0% to $143.8 million during the three months ended November 30, 2024, compared with $139.6 million from the same period a year ago. This growth in revenues was reflective of organic revenues growth of 2.7%, a net increase of 0.2% from foreign currency exchange rate fluctuations and a 0.1% increase from acquisition-related revenues. The increase in revenues was driven by higher demand and price increases primarily from middle office solutions, CGS and data solutions.
Current wording
Revenues from EMEA increased 3.0% to $287.1 million during the six months ended February 28, 2025, compared with $278.7 million from the same period a year ago. This 3.0% growth in revenues was driven by a 2.9% increase in organic revenues and a 0.2% increase from acquisition-related revenues, partially offset by a net decrease of 0.1% from foreign currency exchange rate fluctuations. The increase in revenues was mainly from middle office solutions, CGS and data solutions.
Previous wording
Cost of services increased 2.8% to $258.8 million for the three months ended November 30, 2024, compared with $251.6 million for the same period a year ago, primarily due to an increase in amortization of intangible assets, partially offset by a decrease in employee compensation costs.
Current wording
Cost of services increased 5.7% to $269.6 million for the three months ended February 28, 2025, compared with $255.1 million for the same period a year ago, primarily due to an increase in computer-related expenses and amortization of intangible assets, partially offset by a decrease in employee compensation costs.
Previous wording
•Amortization of intangible assets increased 120 basis points mainly due to higher amortization from increased capitalized costs related to the development of our internal-use software.
Current wording
•Amortization of intangible assets increased by 80 basis points, mainly due to higher amortization from increased capitalized costs related to the development of our internal-use software.
Previous wording
•Employee compensation costs decreased by 180 basis points primarily driven by a decrease in variable compensation costs.
Current wording
•Employee compensation costs decreased by 210 basis points, primarily driven by a decrease in restructuring charges, partially offset by an increase in variable compensation costs.
Previous wording
Cost of services, when expressed as a percentage of revenues, was 45.5% for the three months ended November 30, 2024, a decrease of 90 basis points compared with the same period a year ago. This decrease was primarily due to lower employee compensation costs, partially offset by an increase in amortization of intangible assets.
Current wording
Cost of services, when expressed as a percentage of revenues, was 46.4% for the six months ended February 28, 2025, a decrease of 20 basis points compared with the same period a year ago. This decrease was primarily driven by lower employee compensation costs, partially offset by an increase in amortization of intangible assets.
Previous wording
SG&A increased 16.7% to $118.6 million for the three months ended November 30, 2024, compared with $101.6 million from the same period a year ago, primarily driven by higher employee compensation costs and professional fees.
Current wording
SG&A increased 6.2% to $115.6 million for the three months ended February 28, 2025, compared with $108.9 million in the same period a year ago, primarily driven by higher professional fees.
Previous wording
SG&A, when expressed as a percentage of revenues, was 20.8% for the three months ended November 30, 2024, an increase of 210 basis points compared with the same period a year ago. This increase was primarily driven by higher employee compensation costs and professional fees.
Current wording
SG&A, when expressed as a percentage of revenues, was 20.3% for the three months ended February 28, 2025, an increase of 30 basis points compared with the same period a year ago. This increase was primarily driven by higher professional fees, partially offset by a decrease in bad debt expense.
Previous wording
Operating margin decreased to 33.6% during the three months ended November 30, 2024, compared with 34.9% in the prior year period. When expenses are expressed as a percentage of revenues, this decrease in operating margin was mainly due to higher amortization of intangible assets and professional fees, partially offset by growth in revenues and a decrease in employee compensation costs.
Current wording
Operating margin decreased to 32.5% during the three months ended February 28, 2025, compared with 33.3% in the prior year period. When expenses are expressed as a percentage of revenues, this decrease in operating margin was mainly due to higher professional fees and computer-related expenses, partially offset by growth in revenues and a decrease in employee compensation costs.
Previous wording
Operating margin decreased to 33.6% during the three months ended November 30, 2024, compared with 34.9% in the prior year period. When expenses are expressed as a percentage of revenues, this decrease in operating margin was mainly due to higher amortization of intangible assets and professional fees, partially offset by growth in revenues and a decrease in employee compensation costs. Diluted earnings per common share ("Diluted EPS") for the three months ended November 30, 2024 was $3.89, an increase of 1.3% compared with the prior year period.
Current wording
Operating margin decreased to 33.1% for the six months ended February 28, 2025, compared with 34.1% in the prior year period. When expenses are expressed as a percentage of revenues, this decrease was primarily due to an increase in professional fees and amortization of intangible assets, partially offset by growth in revenues and a decrease in employee compensation costs.
Previous wording
EMEA operating income increased 0.3% to $69.0 million during the three months ended November 30, 2024, compared with $68.9 million in the same period a year ago. This increase was primarily due to growth in revenues of 3.0%, partially offset by an increase in bad debt expense.
Current wording
EMEA operating income increased 12.3% to $70.6 million during the three months ended February 28, 2025, compared with $62.8 million in the same period a year ago. This increase was primarily due to growth in revenues of 3.0% and lower employee compensation costs mainly due to a decrease in restructuring charges.
Previous wording
Asia Pacific operating income increased 3.0% to $40.5 million during the three months ended November 30, 2024, compared with $39.3 million in the same period a year ago. This increase was mainly due to growth in revenues of 6.3%, partially offset by an increase in employee compensation costs. Employee compensation costs increased primarily due to higher annual base salaries driven by annual merit increases and a net headcount increase of 120 employees, partially offset by a decrease in variable compensation costs and post-employment benefits.
Current wording
Asia Pacific operating income increased 7.3% to $82.3 million during the six months ended February 28, 2025, compared with $76.7 million in the same period a year ago. This increase was mainly due to growth in revenues of 6.3%, partially offset by higher employee compensation costs. Employee compensation costs increased primarily due to higher annual base salaries driven by annual merit increases and a net headcount increase of 162 employees.
Previous wording
For the periods presented, our effective tax rates were lower than the statutory federal income tax rate primarily due to excess tax benefits from stock-based compensation, utilization of foreign tax credits, and research and development ("R&D") tax credits, partially offset by our net state taxes.
Current wording
For the periods presented, our effective tax rates were lower than the applicable U.S. corporate income tax rate. This was primarily attributable to excess tax benefits from stock-based compensation, foreign tax credits, research and development ("R&D") tax credits and a foreign derived intangible income ("FDII") deduction, partially offset by our state income taxes.
Previous wording
The increase in Net income and Diluted EPS for the three months ended November 30, 2024, compared to the respective prior year period, was primarily driven by higher operating income and a decrease in interest expense, partially offset by an increase in the provision for income taxes.
Current wording
The increase in Net income and Diluted EPS for the three and six months ended February 28, 2025, compared to the respective prior year period, was primarily driven by higher operating income.
Previous wording
To supplement the financial measures prepared in accordance with generally accepted accounting principles in the United States ("GAAP"), we use non-GAAP financial measures including organic revenues, adjusted operating income, adjusted operating margin, adjusted net income, EBITDA and adjusted Diluted EPS. The reconciliations from our financial measures calculated and presented in accordance with GAAP to these non-GAAP financial measures are shown in the tables below. These non-GAAP financial measures should not be considered in isolation from, as a substitute for, or superior to, financial measures reported in accordance with GAAP. Moreover, these non-GAAP financial measures have limitations in that they do not reflect all the items associated with the operations of our business as determined in accordance with GAAP. Other companies may calculate similarly titled non-GAAP financial measures differently than we do, limiting the usefulness of those measures for comparative purposes.
Current wording
To supplement the financial measures prepared in accordance with generally accepted accounting principles in the United States ("GAAP"), we use non-GAAP financial measures including organic revenues, adjusted operating income, adjusted operating margin, adjusted net income, EBITDA, adjusted EBITDA and adjusted Diluted EPS. The reconciliations from our financial measures calculated and presented in accordance with GAAP to these non-GAAP financial measures are shown in the tables below. These non-GAAP financial measures should not be considered in isolation from, as a substitute for, or superior to, financial measures reported in accordance with GAAP. Moreover, these non-GAAP financial measures have limitations in that they do not reflect all the items associated with the operations of our business as determined in accordance with GAAP. Other companies may calculate similarly titled non-GAAP financial measures differently than we do, limiting the usefulness of those measures for comparative purposes.
Previous wording
Organic revenues exclude the current year impact of revenues from acquisitions and dispositions completed within the past 12 months ("Acquisition revenues" and "Disposition revenues", respectively) and the current year impact from changes in foreign currency. The table below provides an unaudited reconciliation of revenues to organic revenues:
Current wording
Organic revenues excludes the current year impact of revenues from acquisitions and dispositions completed within the past 12 months ("Acquisition revenues" and "Disposition revenues", respectively) and the current year impact from changes in foreign currency. In addition, for year to date comparisons, organic revenues excludes current year revenues that were incurred prior to the first anniversary date of an acquisition. The table below provides an unaudited reconciliation of revenues to organic revenues:
Previous wording
The table below provides an unaudited reconciliation of Operating income, operating margin, Net income and Diluted EPS to adjusted operating income, adjusted operating margin, adjusted net income, EBITDA and adjusted Diluted EPS. Adjusted operating income and margin, adjusted net income, and adjusted Diluted EPS exclude the impact of acquisition-related intangible asset amortization and non-recurring items. EBITDA represents earnings before interest expense, provision for income taxes and depreciation and amortization.
Current wording
The table below provides an unaudited reconciliation of Operating income, operating margin, Net income and Diluted EPS to adjusted operating income, adjusted operating margin, adjusted net income, EBITDA, adjusted EBITDA and adjusted Diluted EPS. Adjusted operating income and margin, adjusted net income, and adjusted Diluted EPS exclude the impact of acquisition-related intangible asset amortization and non-recurring items. EBITDA represents earnings before interest expense, provision for income taxes and depreciation and amortization, while adjusted EBITDA further excludes non-recurring non-cash expenses.
Previous wording
(1)Sales tax dispute relates to a resolved matter with the Massachusetts Department of Revenue.
Current wording
(1)Related to a resolved matter with the Massachusetts Department of Revenue. Refer to Note 12, Commitments and Contingencies in the Notes to the Consolidated Financial Statements included in Part I, Item 1. of this Quarterly Report on Form 10-Q, for further discussion on this matter.
Previous wording
(3)For purposes of calculating Adjusted net income and Adjusted diluted EPS, all adjustments for the three months ended November 30, 2024 and November 30, 2023 were taxed at an adjusted tax rate of 25.2% and 28.7%, respectively.
Current wording
(3)For purposes of calculating Adjusted net income and Adjusted diluted EPS, all adjustments for the three months ended February 28, 2025 and February 29, 2024 were taxed at an adjusted tax rate of 26.0% and 24.6%, respectively. The six months ended February 28, 2025 and February 29, 2024 were taxed at an adjusted tax rate of 25.6% and 26.0%, respectively.
Previous wording
As of November 30, 2024, Cash and cash equivalents were $289.2 million, compared with $423.0 million as of August 31, 2024. Refer to Summary of Cash Flows within this section below, for more information on cash flows during the first quarter of fiscal 2025.
Current wording
As of February 28, 2025, Cash and cash equivalents were $278.5 million and restricted cash was $13.0 million, compared with Cash and cash equivalents of $423.0 million as of August 31, 2024. Refer to Summary of Cash Flows within this section below, for more information on cash flows during the second quarter of fiscal 2025.
Previous wording
Our cash and cash equivalents are held in numerous locations throughout the world, with $130.8 million in the Americas, $100.5 million in EMEA (predominantly in the UK) and the remaining $57.9 million in Asia Pacific (predominantly in the Philippines and India) as of November 30, 2024.
Current wording
Our cash and cash equivalents are held in numerous locations throughout the world, with $116.3 million in the Americas, $114.4 million in EMEA (predominantly in the UK) and the remaining $47.8 million in Asia Pacific (predominantly in the Philippines, Australia and India) as of February 28, 2025.
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Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
Organic ASV is derived from sell-side firms, primarily including broker-dealers, banking and advisory firms, and private equity and venture capital firms.
Current report — wording carried from elsewhere
Refer to Note 5, Derivative Instruments, in the Notes to the Consolidated Financial Statements included in Part I, Item 1. of this Quarterly Report on Form 10-Q, for more information on the 2024 Swap Agreement and 2022 Swap Agreement.
Current report — wording carried from elsewhere
Refer to Note 6, Acquisitionsin the Notes to the Consolidated Financial Statements included in Part I, Item 1. of this Quarterly Report on Form 10-Q for further discussion of these acquisitions.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
When expressed as a percentage of revenues:
Previous report — wording carried elsewhere
When expressed as a percentage of revenues: