FACTSET RESEARCH SYSTEMS INC
For the period ended Feb 28, 2026. Filed Apr 2, 2026.
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, 2026 · Filed Apr 2, 2026
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 2025-11-30; filed 2026-01-05.
0001628280-26-000223
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-02-28; filed 2026-04-02.
0001628280-26-022873
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 204 previous paragraphs and 217 current paragraphs.
118 unchanged; 67 reworded; 29 added; 14 removed; 5 previous and 3 current paragraphs rearranged.
Tables are not compared: 12 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 (29)
Current report
Fiscal 2026 Second Quarter in Review
Current report
The growth in revenues of 7.1% was driven by a 6.8% increase in organic revenues, which totaled $606.2 million for the three months ended February 28, 2026, and a net increase of 0.3% from foreign currency exchange rate fluctuations. Revenues increased in all our geographic segments, primarily in the Americas. The increase in revenues was primarily driven by workstations, data solutions, and portfolio management and trading solutions.
Current report
The growth in revenues of 8.0% was driven by a 9.7% increase in organic revenues, partially offset by a 1.6% decrease in revenues from the disposition of a business at the end of the prior fiscal year, net of acquisition revenues, and a 0.1% net decrease from foreign currency exchange rate fluctuations. The increase in revenues was driven by data solutions, workstations and middle office solutions, partially offset by a decrease in revenues due to the disposition.
Current report
The growth in revenues of 8.0% was driven by a 6.9% increase in organic revenues and a 1.1% increase from acquisition revenues, net of a decrease in revenues from the disposition of a business at the end of the prior fiscal year. The increase in revenues was driven by workstations, data solutions, and portfolio management and trading solutions.
Current report
The growth in revenues of 4.0% was driven by a 4.0% increase in organic revenues and a 0.8% net increase from foreign currency exchange rate fluctuations, partially offset by a 0.8% decrease in revenues from the disposition of a business at the end of the prior fiscal year, net of acquisition revenues. The increase in revenues was mainly from data solutions and workstations, partially offset by a decrease in revenues due to the disposition.
Current report
The growth in revenues of 7.7% was driven by a 9.0% increase in organic revenues and a 0.1% net increase from foreign currency exchange rate fluctuations, partially offset by a 1.4% decrease in revenues from the disposition of a business at the end of the prior fiscal year, net of acquisition revenues. The increase in revenues was driven by data solutions and workstations, partially offset by a decrease in revenues due to the disposition.
Current report
•Employee compensation costs increased by 50 basis points, primarily due to higher annual base salaries driven by annual merit increases and higher benefit costs related to the labor codes reform implemented by the Government of India effective November 21, 2025 ("India Labor Codes Reform").
Current report
The increase in Cost of services was primarily due to higher employee compensation costs and, to a lesser extent, an increase in amortization of intangible assets and technology-related expenses.
Current report
Cost of services, when expressed as a percentage of revenues, was 48.0% for the six months ended February 28, 2026, an increase of 160 basis points compared with the same period a year ago. This increase was primarily driven by higher amortization of intangible assets and technology-related expenses.
Current report
•Amortization of intangible assets increased by 70 basis points, mainly due to higher amortization from our capitalized internal-use software development costs.
Current report
•Technology-related expenses increased by 60 basis points, primarily driven by higher spend in cloud-based hosting services.
Current report
The increase in SG&A was primarily driven by higher employee compensation costs. SG&A, when expressed as a percentage of revenues, was 21.1% for the six months ended February 28, 2026, an increase of 50 basis points compared with the same period a year ago. This increase was primarily driven by higher employee compensation costs, partially offset by a decrease in professional fees, a benefit from the net settlement of our foreign currency forward contracts and charges related to the Sales Tax Dispute recorded in the prior year period. Refer to Part I, Item 1. Note 11, Commitments and Contingencies in the Notes to the Consolidated Financial Statements of this Quarterly Report on Form 10-Q for more information on the Sales Tax Dispute.
Current report
•Employee compensation costs increased by 140 basis points, mainly due to higher variable compensation costs, stock-based compensation expense and annual base salaries. Variable compensation costs and stock-based compensation expense increased mainly due to the recognition, over their respective service periods, of the one-time cash awards and equity awards, respectively, granted to our CEO pursuant to the terms of his employment agreement. In addition, variable compensation costs increased due to a higher bonus accrual. The increase in annual base salaries was primarily driven by annual merit increases.
Current report
Operating income decreased 0.3% to $185.0 million for the three months ended February 28, 2026, compared with $185.5 million in the prior year period. This decrease was primarily driven by higher employee compensation costs and an increase in other expenses included in Cost of services, partially offset by growth in revenues.
Current report
Operating margin decreased to 30.3% for the three months ended February 28, 2026, compared with 32.5% in the prior year period. When expenses are expressed as a percentage of revenues, this decrease was primarily driven by higher employee compensation costs, partially offset by growth in revenues and a decrease in professional fees.
Current report
•Technology-related expenses increased mainly due to higher spend in cloud-based hosting services.
Current report
EMEA
Current report
Asia Pacific operating income increased mainly due to growth in revenues of 8.0%, partially offset by higher employee compensation costs. Employee compensation costs were higher primarily due to an increase in benefit costs related to the India Labor Codes Reform and higher annual base salaries, driven by annual merit increases.
Current report
Americas operating income decreased primarily due to higher employee compensation costs and, to a lesser extent, an increase in amortization of intangible assets and technology-related expenses, partially offset by growth in revenues of 8.0%.
Current report
•Employee compensation costs increased primarily due to higher variable compensation costs, stock-based compensation expense and an increase in annual base salaries. Variable compensation costs and stock-based compensation expense increased mainly due to the recognition, over their respective service periods, of the one-time cash awards and equity awards, respectively, granted to our CEO pursuant to the terms of his employment agreement. In addition, variable compensation costs increased due to a higher bonus accrual. The increase in annual base salaries was primarily driven by annual merit increases.
Current report
•Amortization of intangible assets increased mainly due to higher amortization from our capitalized internal-use software development costs.
Current report
•Technology-related expenses increased mainly due to higher spend in cloud-based hosting services.
Current report
EMEA
Current report
Our effective tax rate for the three months ended February 28, 2026 and February 28, 2025 was 17.4% and 15.9%, respectively. The increase was primarily due to the limitation on the deductibility of executive compensation and lower excess tax benefits from stock-based compensation, partially offset by a favorable resolution of uncertain tax positions in the U.S.
Current report
The decrease in Net income and Diluted EPS for the three months ended February 28, 2026, compared to the prior year period, was mainly driven by higher operating expenses and an impairment charge within Other assets, partially offset by growth in revenues. The decrease in Diluted EPS was also partially offset by lower diluted weighted average common shares outstanding.
Current report
(4)Related to the impairment of an equity investment.
Current report
(6)Primarily related to the impairment of an equity investment.
Current report
In addition to the discussion below, refer to Note 10, Debt 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 our outstanding borrowings and swap agreements.
Current report
As of February 28, 2026, our outstanding debt under the 2025 Term Facility was $375.0 million and there were no borrowings under the 2025 Revolving Facility.
Removed paragraphs (14)
Previous report
Fiscal 2026 First Quarter in Review
Previous report
Americas
Previous report
Asia Pacific
Previous report
The growth in revenues of 7.3% was driven by an 8.3% increase in organic revenues and a 0.2% net increase from foreign currency exchange rate fluctuations, partially offset by a 1.2% decrease in revenues from a disposition, net of acquisition revenues. The increase in revenues was driven by data solutions and workstations, partially offset by a decrease in revenues due to the disposition of a business at the end of the prior fiscal year.
Previous report
Americas
Previous report
•Technology-related expenses increased mainly driven by higher spend related to cloud-based hosting services.
Previous report
Asia Pacific
Previous report
events.
Previous report
We made no repayments of the 2025 Term Facility during the three months ended November 30, 2025. Since loan inception on April 8, 2025, we have repaid $125.0 million under the 2025 Term Facility. Of this amount, $68.8 million satisfied all scheduled quarterly principal payments through maturity, eliminating any future mandatory quarterly principal payment requirements. The remaining $56.2 million was made as a voluntary prepayment. From the effective date of the 2025 Revolving Facility through November 30, 2025, we have had no borrowings under the 2025 Revolving Facility.
Previous report
Debt issuance costs related to the 2025 Credit Facilities were $3.4 million. These debt issuance costs are presented in the Consolidated Balance Sheets as a direct deduction from the carrying amount of the debt liability for the 2025 Term Facility and within Other assets for the 2025 Revolving Facility. Debt issuance costs are amortized to Interest expense in the Consolidated Statements of Income on a straight-line basis over the contractual term of the debt (which approximates the effective interest method for the 2025 Term Facility).
Previous report
The 2025 Credit Agreement contains usual and customary event of default provisions for facilities of this type, which are subject to usual and customary grace periods and materiality thresholds. If an event of default occurs under the 2025 Credit Agreement, the lenders may, among other things, terminate their commitments and declare all outstanding borrowings immediately due and payable.
Previous report
During the three months ended November 30, 2024, we repaid $62.5 million under the 2022 Term Facility. The 2022 Term Facility, originally due to mature on March 1, 2025, was repaid in full during the six months ended February 28, 2025. During the three months ended November 30, 2024, we borrowed an additional $55.0 million under the 2022 Revolving Facility. The 2022 Credit Agreement was terminated on April 8, 2025, concurrent with entering into the 2025 Credit Agreement.
Previous report
Refer to Part I, Item 3. Quantitative and Qualitative Disclosures About Market Risk, in this Quarterly Report on Form 10-Q, for further discussion of our exposure to interest rate risk on our outstanding floating rate debt.
Previous report
The Senior Notes were issued at an aggregate discount of $2.8 million and we incurred approximately $9.1 million in debt issuance costs during fiscal 2022. Debt discounts and debt issuance costs are presented in the Consolidated Balance Sheets as a net direct deduction from the carrying amount of the debt liability. The debt discounts and debt issuance costs are amortized to Interest expense in the Consolidated Statements of Income over the contractual term of the debt, leveraging the effective interest method.
Reworded paragraphs (67)
Previous wording
Our platform delivers expansive data, sophisticated analytics, and flexible, artificial intelligence ("AI")-powered technologies used by global financial professionals to power their critical investment workflows. As of November 30, 2025, we had more than 9,000 clients comprised of over 239,000 investment professionals, including institutional asset managers, bankers, wealth managers, asset owners, 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, artificial intelligence ("AI")-powered technologies used by global financial professionals to power their critical investment workflows. As of February 28, 2026, we had more than 9,000 clients comprised of over 241,000 investment professionals, including institutional asset managers, bankers, wealth managers, asset owners, 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
We drive our business based on a detailed understanding of our clients' workflows, which helps us to solve their most complex challenges. We provide financial data and market intelligence on securities, companies, industries and people to enable our clients to research investment ideas and analyze, monitor and manage their portfolios. Our solutions span the investment lifecycle of investment research, portfolio construction and analysis, trade execution, performance measurement, risk management and reporting. We provide open and flexible technology offerings, including a configurable desktop and mobile platform, comprehensive data feeds, cloud-based digital solutions, and application programming interfaces ("APIs"). AI is embedded across these offerings to enhance data discovery, automate routine workflows and improve the speed and accuracy of client insights. The CUSIP Global Services ("CGS") business supports security master files relied on by the investment industry for critical front, middle and back-office functions. All of our platforms and solutions are supported by our client service team.
Current wording
We drive our business based on a detailed understanding of our clients' workflows, which helps us to solve their most complex challenges. We provide financial data and market intelligence on securities, companies, industries and people to enable our clients to research investment ideas and analyze, monitor and manage their portfolios. Our solutions span the investment lifecycle of investment research, portfolio construction and analysis, trade execution, performance measurement, risk management and reporting. We provide open and flexible technology offerings, including a configurable desktop and mobile platform, comprehensive data solutions, cloud-based digital solutions, and application programming interfaces ("APIs"). AI is embedded across these offerings to enhance data discovery, automate routine workflows and improve the speed and accuracy of client insights. The CUSIP Global Services ("CGS") business supports security master files relied on by the investment industry for critical front, middle and back-office functions. All of our platforms and solutions are supported by our client service team.
Previous wording
Revenues in the first quarter of fiscal 2026 were $607.6 million, an increase of 6.9% from the comparable prior year period. The growth in revenues was driven by a 6.0% increase in organic revenues, a 0.7% increase from acquisition revenues, net of a decrease in revenues from a disposition of a business at the end of the prior fiscal year, and a net increase of 0.2% from foreign currency exchange rate fluctuations. Revenues increased in all our segments, primarily in the Americas. Revenues increased primarily from workstations, portfolio management and trading solutions, 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 the definition of organic revenues and a reconciliation between revenues and organic revenues.
Current wording
Revenues in the second quarter of fiscal 2026 were $611.0 million, an increase of 7.1% from the comparable prior year period. The growth in revenues was driven by a 6.8% increase in organic revenues and a net increase of 0.3% from foreign currency exchange rate fluctuations. Revenues increased in all our segments, primarily in the Americas. The increase in revenues was primarily from workstations, data solutions, and portfolio management and trading 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 the definition of organic revenues and a reconciliation between revenues and organic revenues.
Previous wording
As of November 30, 2025, organic annual subscription value ("Organic ASV") totaled $2,389.6 million, an increase of 5.9% 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 driven by workstations, data solutions 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.
Current wording
As of February 28, 2026, organic annual subscription value ("Organic ASV") totaled $2,449.1 million, an increase of 6.7% 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 driven by data solutions and workstations. 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
Operating margin was 31.6% for the first quarter of fiscal 2026, compared to 33.6% in the prior year period. This decrease in operating margin was primarily driven by higher amortization of intangible assets, employee compensation costs and technology-related expenses, partially offset by growth in revenues.
Current wording
Operating margin was 30.3% for the second quarter of fiscal 2026, compared to 32.5% in the prior year period. When expenses are expressed as a percentage of revenues, this decrease was primarily driven by higher employee compensation costs, partially offset by growth in revenues and a decrease in professional fees.
Previous wording
Net income for the first quarter of fiscal 2026 was $152.6 million, an increase of 1.7% from the prior year period. Diluted earnings per common share ("Diluted EPS") was $4.06 for the first quarter of fiscal 2026, an increase of 4.4% compared with the prior year period. The increase in Net Income and Diluted EPS was primarily driven by growth in revenues, partially offset by higher operating expenses.
Current wording
Net income for the second quarter of fiscal 2026 was $133.1 million, a decrease of 8.1% from the prior year period. Diluted earnings per common share ("Diluted EPS") was $3.59 for the second quarter of fiscal 2026, a decrease of 4.5% compared with the prior year period. These decreases were driven by higher operating expenses and an impairment charge within Other assets, partially offset by growth in revenues. The decrease in Diluted EPS was also partially offset by lower diluted weighted average common shares outstanding.
Previous wording
We returned $181.3 million to our stockholders in the form of share repurchases and dividends during the three months ended November 30, 2025.
Current wording
We returned $204.0 million to our stockholders in the form of share repurchases and dividends during the three months ended February 28, 2026.
Previous wording
As of November 30, 2025, our client and user count was 9,003 and 239,863, respectively. Our employee headcount was 12,886 as of November 30, 2025, up 2.5% compared to the prior year. This increase was driven by net headcount growth of 3.0% in the Americas, 2.4% in Asia Pacific and 2.3% in EMEA.
Current wording
As of February 28, 2026, our client and user count was 9,101 and 241,352, respectively. Our employee headcount was 12,840 as of February 28, 2026, up 1.9% compared to the prior year. This increase was driven by net headcount growth of 2.3% in Asia Pacific, 1.1% in the Americas and 1.0% in EMEA.
Previous wording
(2)For comparability purposes, in calculating the organic ASV annual growth rate, the prior year excludes ASV from dispositions completed in the last 12 months.
Current wording
(1)For comparability purposes, in calculating the organic ASV annual growth rate, the prior year excludes ASV from dispositions completed in the last 12 months.
Previous wording
Organic ASV increased in all our segments, with the majority of the increase in the Americas. The increase in Organic ASV was primarily driven by workstations, data solutions and, to a lesser extent, CGS. This increase is derived from higher net sales to existing clients and, to a lesser extent, sales to new clients.
Current wording
Organic ASV increased in all our segments, with the majority of the increase in the Americas. The increase in Organic ASV was primarily driven by data solutions and workstations. This increase is derived from higher net sales to existing clients and, to a lesser extent, sales to new clients.
Previous wording
As of November 30, 2025, ASV from the Americas represented 65% of total ASV and was $1,575.8 million, an increase from $1,464.5 million as of November 30, 2024. Americas Organic ASV was $1,556.5 million as of November 30, 2025, a 6.4% increase from the prior year. The Organic ASV increase in the Americas was primarily driven by workstations and, to a lesser extent, data solutions and CGS.
Current wording
As of February 28, 2026, ASV from the Americas represented 66% of total ASV and was $1,605.9 million, an increase from $1,501.1 million as of February 28, 2025. Americas Organic ASV was $1,605.8 million as of February 28, 2026, a 7.0% increase from the prior year. The Organic ASV increase in the Americas was primarily driven by workstations and data solutions.
Previous wording
As of November 30, 2025, ASV from EMEA represented 25% of total ASV and was $591.0 million, an increase from $572.4 million as of November 30, 2024. EMEA Organic ASV was $588.5 million as of November 30, 2025, a 3.7% increase from the prior year. The EMEA Organic ASV increase was mainly from data solutions and, to a lesser extent, workstations and CGS.
Current wording
As of February 28, 2026, ASV from EMEA represented 24% of total ASV and was $595.2 million, an increase from $571.3 million as of February 28, 2025. EMEA Organic ASV was $594.2 million as of February 28, 2026, a 4.3% increase from the prior year. The EMEA Organic ASV increase was mainly from data solutions and workstations.
Previous wording
As of November 30, 2025, ASV from Asia Pacific represented 10% of total ASV and was $244.3 million, an increase from $229.0 million as of November 30, 2024. Asia Pacific Organic ASV was $244.6 million as of November 30, 2025, an 8.4% increase from the prior year. The Asia Pacific Organic ASV increase was primarily driven by data solutions, workstations and middle office solutions.
Current wording
As of February 28, 2026, ASV from Asia Pacific represented 10% of total ASV and was $249.1 million, an increase from $233.7 million as of February 28, 2025. Asia Pacific Organic ASV was $249.1 million as of February 28, 2026, a 10.0% increase from the prior year. The Asia Pacific Organic ASV increase was primarily driven by data solutions, workstations and middle office solutions.
Previous wording
Client count increased mainly due to corporate clients and user count increased primarily due to wealth management users.
Current wording
Client count increased mainly due to corporate and wealth management clients and user count increased primarily due to wealth management users.
Previous wording
As of November 30, 2025, our net employee headcount increased by 2.5% to 12,886, compared with 12,575 employees as of November 30, 2024. This net headcount growth was primarily driven by our continued investment in our centers of excellence ("COEs"), through an increase in employees based in India, and our Liquid Holdings, LLC ("LiquidityBook") acquisition.
Current wording
As of February 28, 2026, our net employee headcount increased by 1.9% to 12,840, compared with 12,598 employees as of February 28, 2025. This net headcount growth was primarily driven by our continued investment in our centers of excellence ("COEs"), through an increase in employees based in India.
Previous wording
As of November 30, 2025, compared to November 30, 2024, our net headcount growth was 3.0% in the Americas, 2.4% in Asia Pacific and 2.3% in EMEA. As of November 30, 2025, we had 8,921 employees located in Asia Pacific, 2,508 in the Americas and 1,457 in EMEA. Approximately 68% of our employees are located in our COEs.
Current wording
As of February 28, 2026, compared to February 28, 2025, our net headcount growth was 2.3% in Asia Pacific, 1.1% in the Americas,and 1.0% in EMEA. As of February 28, 2026, we had 8,883 employees located in Asia Pacific, 2,501 in the Americas and 1,456 in EMEA. Approximately 68% of our employees are located in our COEs.
Previous wording
For an understanding of the significant factors that influenced our performance for the three months ended November 30, 2025 and November 30, 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.
Current wording
For an understanding of the significant factors that influenced our performance for the three and six months ended February 28, 2026 and February 28, 2025, 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
The growth in revenues of 6.9% was driven by a 6.0% increase in organic revenues, which totaled $600.0 million for the three months ended November 30, 2025, a 0.7% increase from acquisition revenues, net of a decrease in revenues from a disposition of a business at the end of the prior fiscal year, and a net increase of 0.2% from foreign currency exchange rate fluctuations. Revenues increased in all our geographic segments, primarily in the Americas. The increase in revenues was primarily driven by workstations, portfolio management and trading solutions, and data solutions.
Current wording
The growth in revenues of 7.0% was driven by a 6.4% increase in organic revenues, which totaled $1,206.2 million for the six months ended February 28, 2026, a 0.3% increase from acquisition revenues, net of a decrease in revenues from the disposition of a business at the end of the prior fiscal year, and a 0.3% net increase from foreign currency exchange rate fluctuations. Revenues increased in all our segments, primarily in the Americas. The increase in revenues was mainly from workstations, data solutions, and portfolio management and trading solutions.
Previous wording
The growth in revenues of 7.9% was driven by a 6.5% increase in organic revenues and a 1.4% increase from acquisition revenues, net of a decrease in revenues from a disposition of a business at the end of the prior fiscal year. The increase in revenues was driven by workstations, portfolio management and trading solutions, and data solutions.
Current wording
The growth in revenues of 8.1% was driven by a 7.4% increase in organic revenues and a 0.7% increase from acquisition revenues, net of a decrease in revenues from the disposition of a business at the end of the prior fiscal year. The increase in revenues was driven by workstations, data solutions, and portfolio management and trading solutions.
Previous wording
The growth in revenues of 4.0% was driven by a 4.0% increase in organic revenues and a 0.6% net increase from foreign currency exchange rate fluctuations, partially offset by a 0.6% decrease in revenues from a disposition, net of acquisition revenues. The increase in revenues was mainly from data solutions, partially offset by a decrease in revenues due to the disposition of a business at the end of the prior fiscal year.
Current wording
The growth in revenues of 4.0% was driven by a 4.0% increase in organic revenues and a 1.0% net increase from foreign currency exchange rate fluctuations, partially offset by a 1.0% decrease in revenues from the disposition of a business at the end of the prior fiscal year, net of acquisition revenues. The increase in revenues was mainly from data solutions and workstations, partially offset by a decrease in revenues due to the disposition.
Previous wording
The increase in Cost of services was primarily due to higher employee compensation costs, amortization of intangible assets and technology-related expenses.
Current wording
The increase in Cost of services was primarily due to higher employee compensation costs and, to a lesser extent, an increase in technology-related expenses and amortization of intangible assets.
Previous wording
Cost of services, when expressed as a percentage of revenues, was 47.4% for the three months ended November 30, 2025, an increase of 190 basis points compared with the same period a year ago. This increase was primarily due to higher amortization of intangible assets and an increase in technology-related expenses.
Current wording
Cost of services, when expressed as a percentage of revenues, was 48.6% for the three months ended February 28, 2026, an increase of 130 basis points compared with the same period a year ago. This increase was primarily due to higher employee compensation costs, technology-related expenses and amortization of intangible assets.
Previous wording
•Technology-related expenses increased by 80 basis points, primarily driven by higher spend related to cloud-based hosting services.
Current wording
•Technology-related expenses increased by 40 basis points, primarily driven by higher spend in cloud-based hosting services.
Previous wording
•Amortization of intangible assets increased by 100 basis points, mainly due to higher amortization from our capitalized internal-use software development costs.
Current wording
•Amortization of intangible assets increased by 40 basis points, mainly due to higher amortization from our capitalized internal-use software development costs.
Previous wording
The increase in SG&A was primarily attributable to higher employee compensation costs. SG&A, when expressed as a percentage of revenues, was 21.0% for the three months ended November 30, 2025, an increase of 20 basis points compared with the same period a year ago. The increase was primarily attributable to higher employee compensation costs, partially offset by charges related to the Sales Tax Dispute recorded in the prior year period and a decrease in professional fees.
Current wording
The increase in SG&A was primarily attributable to higher employee compensation costs. SG&A, when expressed as a percentage of revenues, was 21.2% for the three months ended February 28, 2026, an increase of 90 basis points compared with the same period a year ago. The increase was primarily driven by higher employee compensation costs, partially offset by a decrease in professional fees and a benefit from the net settlement of our foreign currency forward contracts.
Previous wording
•Employee compensation costs increased by 110 basis points, primarily driven by higher stock-based compensation expense, variable compensation costs and an increase in annual base salaries. The higher stock-based compensation expense and variable compensation costs were due to equity awards and one-time cash awards, respectively, granted to our Chief Executive Officer ("CEO") pursuant to the terms of his employment agreement. The increase in annual base salaries was primarily driven by annual merit increases.
Current wording
•Employee compensation costs increased by 160 basis points, primarily due to higher variable compensation costs, annual base salaries and an increase in stock-based compensation expense. Variable compensation costs increased mainly due to a higher bonus accrual. In addition, variable compensation costs and stock-based compensation expense increased due to the recognition, over their respective service periods, of the one-time cash awards and equity awards, respectively, granted to our Chief Executive Officer ("CEO") pursuant to the terms of his employment agreement. The increase in annual base salaries was primarily driven by annual merit increases.
Previous wording
•Professional fees decreased by 30 basis points, mainly due to acquisition-related costs recorded in the prior year period.
Current wording
•Professional fees decreased by 60 basis points, mainly due to acquisition-related costs recorded in the prior year period.
Previous wording
•SG&A decreased by 40 basis points due to charges related to the Sales Tax Dispute recorded in the prior year period. Refer to Part I, Item 1. Note 11, Commitments and Contingencies in the Notes to the Consolidated Financial Statements of this Quarterly Report on Form 10-Q for more information on the Sales Tax Dispute.
Current wording
•SG&A decreased by 40 basis points due to a benefit from the net settlement of foreign currency forward contracts.
Previous wording
Operating income increased 0.4% to $192.1 million for the three months ended November 30, 2025, compared with $191.3 million in the prior year period. This increase was primarily driven by growth in revenues, partially offset by higher employee compensation costs, amortization of intangible assets and technology-related expenses.
Current wording
Operating income increased 0.1% to $377.0 million for the six months ended February 28, 2026, compared with $376.8 million in the prior year period. This increase was primarily driven by growth in revenues, partially offset by higher employee compensation costs, amortization of intangible assets and technology-related expenses.
Previous wording
Operating margin decreased to 31.6% for the three months ended November 30, 2025, compared with 33.6% in the prior year period. When expenses are expressed as a percentage of revenues, this decrease was primarily driven by higher amortization of intangible assets, employee compensation costs and technology-related expenses, partially offset by growth in revenues.
Current wording
Operating margin decreased to 30.9% for the six months ended February 28, 2026, compared with 33.1% in the prior year period. When expenses are expressed as a percentage of revenues, this decrease was primarily due to higher employee compensation costs, amortization of intangible assets and technology-related expenses, partially offset by growth in revenues.
Previous wording
Americas operating income decreased primarily due to higher employee compensation costs, amortization of intangible assets and technology-related expenses, partially offset by growth in revenues of 7.9%.
Current wording
Americas operating income increased primarily due to growth in revenues of 8.1%, partially offset by higher employee compensation costs and, to a lesser extent, an increase in technology-related expenses and amortization of intangible assets.
Previous wording
•Employee compensation costs increased primarily driven by higher stock-based compensation expense, variable compensation costs and an increase in annual base salaries. The higher stock-based compensation expense and variable compensation costs were due to equity awards and one-time cash awards, respectively, granted to our CEO pursuant to the terms of his employment agreement. The increase in annual base salaries was primarily driven by annual merit increases and net headcount growth of 72 employees.
Current wording
•Employee compensation costs increased primarily due to higher variable compensation costs, stock-based compensation expense, and an increase in annual base salaries. Variable compensation costs increased mainly due to a higher bonus accrual. In addition, variable compensation costs and stock-based compensation expense increased due to the recognition, over their respective service periods, of the one-time cash awards and equity awards, respectively, granted to our CEO pursuant to the terms of his employment agreement. The increase in annual base salaries was primarily driven by annual merit increases.
Previous wording
EMEA operating income decreased primarily due to higher employee compensation costs, partially offset by growth in revenues of 4.0%. Employee compensation costs increased mainly due to higher annual base salaries, primarily driven by annual merit increases and net headcount growth of 33 employees.
Current wording
EMEA operating income decreased primarily due to higher employee compensation costs, partially offset by growth in revenues of 4.0%. Employee compensation costs increased mainly due to higher annual base salaries, primarily driven by annual merit increases.
Previous wording
Asia Pacific operating income increased mainly due to growth in revenues of 7.3%, partially offset by higher employee compensation costs. Employee compensation costs increased primarily due to higher annual base salaries driven by annual merit increases and net headcount growth of 206 employees.
Current wording
Asia Pacific operating income increased mainly due to growth in revenues of 7.7%, partially offset by higher employee compensation costs. Employee compensation costs increased primarily due to higher annual base salaries, driven by annual merit increases, and higher benefit costs related to the India Labor Codes Reform.
Previous wording
We are subject to taxation in the U.S. and various state, local and foreign jurisdictions in which we conduct our business. Our
Current wording
We are subject to taxation in the United States ("U.S.") and various state, local and foreign jurisdictions in which we conduct our business. Our effective tax rate will vary based on, among other factors, changes in levels of foreign income, as well as other non-recurring events.
Previous wording
Our provision for income taxes for interim periods is calculated by applying an estimate of our annual effective tax rate to our quarter and year-to-date results, adjusted for discrete items recorded in the period. The computation of the annual estimated effective tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected pretax income (or loss) for the year, projections of the proportion of income (or loss) earned and taxed in foreign jurisdictions, permanent and temporary differences and the likelihood of recovering deferred tax assets, then adjusted for any discrete items. On a quarterly basis, we update the estimate of our annual effective tax rate as new events occur, assumptions change, or additional information is obtained.
Current wording
Our provision for income taxes for interim periods is calculated by applying an estimate of our annual effective tax rate to our quarter and year-to-date results, adjusted for discrete items recorded in the period. The computation of the annual estimated effective tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected pretax income (or loss) for the year, projections of the proportion of pretax income (or loss) attributable to, and subject to tax in, foreign jurisdictions, permanent and temporary differences and the likelihood of recovering deferred tax assets, then adjusted for any discrete items. On a quarterly basis, we update the estimate of our annual effective tax rate as new events occur, assumptions change, or additional information is obtained.
Previous wording
Our effective tax rate for the three months ended November 30, 2025 and November 30, 2024 was 19.7% and 16.5%, respectively. The increase was primarily due to a stock-based compensation tax shortfall in the first quarter of fiscal 2026 compared to an excess tax benefit for the prior year period.
Current wording
Our effective tax rate for the six months ended February 28, 2026 and February 28, 2025 was 18.7% and 16.2%, respectively. The increase was primarily due to a stock-based compensation tax shortfall for the six months ended February 28, 2026, compared to an excess tax benefit for the prior year period.
Previous wording
For the periods presented, our effective tax rates differ from the applicable U.S. corporate income tax rate primarily due to excess tax benefits or shortfalls from stock-based compensation, the U.S. tax impact of foreign earnings, research and development ("R&D") tax credits, a foreign derived intangible income ("FDII") tax deduction and the impact of state income taxes.
Current wording
For the periods presented, our effective tax rates were lower than the applicable U.S. corporate income tax rate ("U.S. tax rate") primarily due to the U.S. tax impact of foreign earnings, research and development ("R&D") tax credits, and a foreign derived intangible income ("FDII") tax deduction, partially offset by the impact of state income taxes. In addition, our effective tax rate was lower than the U.S. tax rate for the three months ended February 28, 2026 due to a favorable resolution of uncertain tax positions in the U.S., and for the three and six months ended February 28, 2025 due to excess tax benefits from stock-based compensation.
Previous wording
The increase in Net income and Diluted EPS for the three months ended November 30, 2025, compared to the respective prior year period, was primarily driven by growth in revenues, partially offset by higher operating expenses.
Current wording
The decrease in Net income and Diluted EPS for the six months ended February 28, 2026, compared to the respective prior year period, was primarily driven by higher operating expenses and an increase in the provision for income taxes, partially offset by growth in revenues. The decrease in Diluted EPS was also partially offset by lower diluted weighted average common shares outstanding.
Previous 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. 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 earned prior to the first anniversary date of the acquisition. The table below provides an unaudited reconciliation of revenues to organic revenues:
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Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
•Professional fees decreased by 50 basis points, mainly due to acquisition-related costs recorded in the prior year period.
Current report — wording carried from elsewhere
•SG&A decreased by 50 basis points due to a benefit from the net settlement of foreign currency forward contracts and charges related to the Sales Tax Dispute recorded in the prior year period.
Current report — wording carried from elsewhere
EMEA operating income decreased primarily due to higher employee compensation costs, partially offset by growth in revenues of 4.0%. Employee compensation costs increased primarily due to an increase in annual base salaries driven by annual merit increases.
Rearranged previous paragraphs (5)
Previous report — wording carried elsewhere
(1)ASV from acquisitions completed within the last 12 months.
Previous report — wording carried elsewhere
When expressed as a percentage of revenues:
Previous report — wording carried elsewhere
When expressed as a percentage of revenues:
Previous report — wording carried elsewhere
effective tax rate will vary based on, among other factors, changes in levels of foreign income, as well as other non-recurring
Previous report — wording carried elsewhere
On December 16, 2025, our Board of Directors approved an additional $600 million in share repurchase authority, which is available immediately with no expiration date. The additional authorization also removed the expiration date from the June 17, 2025 authorization.