Full Year · Fiscal year 2026 · Published by Pham Hop
FactSet grew fiscal 2026 revenue 6.7% to $2.48B and organic ASV a record 7.0%, but restructuring, CEO awards and higher pay and tech costs cut GAAP operating margin to 28.3% and diluted EPS 6.3% to $14.57; FY2027 guidance assumes slower 5-6.5% ASV growth.
Revenue
$2.5B
+6.7% YoY
Net income
$534M
-10.6% YoY
Diluted EPS
$14.57
-6.3% YoY
Operating margin
28.3%
This period vs a year ago
Same period last year
This period
Revenue▲+6.7%
≈$2.3B
$2.5B
Net income▼-10.6%
≈$597M
$534M
Diluted EPS▼-6.3%
≈$15.55
$14.57
Year-ago figures (≈) are worked out from the growth rate the company reported. Each row has its own scale.
How FDS compares with Financials peers
FDS
Peer median
Each peer (hover for name)
Revenue growth (YoY)+6.7% · median +14.1% · 45th of 55
Overview
FactSet sells financial data and analytics software to banks, asset managers, wealth advisers and companies, almost entirely on subscription. In fiscal 2026 (the twelve months ended August 31, 2026) sales kept growing at a steady pace, but profit fell for the second quarter running. Revenue rose 6.7% to $2,476.3 million, slightly above the top of management's own range. GAAP net income fell 10.6% to $533.5 million, and diluted EPS fell 6.3% to $14.57. GAAP means profit under standard accounting rules, with nothing excluded.
Two things pulled profit down. First, $79.1 million of one-off operating costs, led by $46.2 million of restructuring (reorganisation and severance) charges and $19.5 million of one-time pay awards to the new CEO. Second, and more lasting, costs grew faster than revenue even with those items removed: higher bonus pay tied to subscription sales, and higher technology spending. Subscription sales themselves had a record year. Organic ASV (explained below) grew 7.0%.
This analysis is based on the earnings release filed with an 8-K on September 30, 2026 (Exhibit 99.1). The full 10-K annual report has not been filed yet, so the detailed management commentary (MD&A), client and user counts, and the cost breakdown by line item are not available. Where this report explains why something moved, it uses the release's own wording.
At a glance
Organic ASV up 7.0% to $2,568.2 million (+$168.2 million). This is the best measure of where revenue is heading, and the dollar gain beat the top of FactSet's own $130–$160 million target for the year.
GAAP operating margin down to 28.3% from 32.2%. About half of the fall is one-off charges. The rest is a cost base growing faster than sales, since even FactSet's adjusted margin fell 1.8 points to 34.5%.
Adjusted EPS up 6.1% to $18.01, but adjusted net income rose only 1.2%. Nearly all of the per-share growth came from buying back shares, which cut the diluted share count by 4.6%.
Key metrics
Revenue, profit and cash figures in USD millions except per-share amounts.
EPS growth (YoY)-6.3% · median +20.6% · 45th of 52
≤ -57.7%≥ +90.6%
Rank 1 = fastest revenue growth, highest operating margin, fastest EPS growth. Peers are the other Financials companies with a 2026 report on this site, each at its latest period we've analyzed; fiscal calendars differ, so periods are not always the same months.
YoY Change
Revenue
$2,476.3
$2,321.7
+6.7%
Organic revenue
$2,464.6
$2,309.3
+6.7%
GAAP operating margin
28.3%
32.2%
-3.9 pts
Adjusted operating margin
34.5%
36.3%
-1.8 pts
Net income
$533.5
$597.0
-10.6%
Diluted EPS
$14.57
$15.55
-6.3%
Adjusted diluted EPS
$18.01
$16.98
+6.1%
Organic ASV (Aug 31)
$2,568.2
—
+7.0%
Annual ASV retention
>95%
—
"remained above 95%"
Operating cash flow
$822.2
$726.3
+13.2%
Free cash flow
$707.5
$617.5
+14.6%
Operating margin is the share of revenue left after the costs of running the business, before interest and tax. Free cash flow is operating cash flow minus spending on equipment and capitalised software. "Organic" figures strip out acquisitions, businesses sold, and currency moves, so they show growth from the existing business alone.
Fourth quarter alone (June–August 2026): revenue rose 6.3% to $634.7 million (organic +7.1%). GAAP operating margin was 24.7%, down from 29.7%. Net income fell 21.1% to $121.1 million and diluted EPS fell 15.4% to $3.41. Adjusted EPS rose 11.6% to $4.52.
Subscriptions: a record year for new sales
ASV (annual subscription value) is the revenue FactSet would collect over the next 12 months from every subscription running today. Because almost all of FactSet's revenue is subscriptions, ASV is the best early read on next year's sales. Organic ASV grew 7.0%, or $168.2 million, to $2,568.2 million at August 31. The CEO called it "a record increase in organic ASV for both the fourth quarter and fiscal year."
Other subscription signals in the release:
Retention: "Annual ASV retention remained above 95%." In other words, clients that leave or cut back take less than 5% of subscription value with them each year. The release does not give the client-count retention rate. In Q3 that rate had slipped to 90% from 91%, so the 10-K figure is worth checking.
Longer contracts: in Q4, average renewal contract length rose about 30%. In Q3 the release had described enterprise renewals as 30% longer too. Longer contracts lock in revenue, but they can also come with price concessions. The release doesn't say which.
AI products: "AI solutions ASV added in fiscal 2026 more than doubled year over year." No dollar figure is given, so it's impossible to tell how much of the $168.2 million came from AI products.
By region
Region
ASV (Aug 31, 2026)
Organic ASV growth
Q4 revenue
Q4 FY25 revenue
Q4 organic revenue growth
Americas
$1,678.2M
7.1%
$414.3M
$388.7M
6.7%
EMEA
$620.9M
5.2%
$154.8M
$147.4M
6.6%
Asia Pacific
$266.1M
10.6%
$65.6M
$60.8M
11.0%
The Americas make up 65% of ASV and drove most of the dollar growth. Asia Pacific is the fastest-growing region and sped up from 10.0% organic ASV growth at May 31. EMEA (Europe, Middle East and Africa) is the weak spot: its organic ASV growth slowed to 5.2% from 5.6% a quarter earlier, even though its Q4 revenue growth improved.
Why profit fell while sales grew
Total operating expenses rose 12.9%, almost twice as fast as revenue (+6.7%). Cost of services (running the data and products) rose 11.4% to $1,223.1 million. Selling, general and administrative costs rose 16.3% to $553.2 million.
The release gives the reasons in one line: GAAP margin fell "primarily due to higher employee compensation costs, mainly driven by one-time restructuring charges, ASV-linked incentive plans and one-time CEO compensation costs." For the adjusted margin, which excludes the one-offs, it names "higher compensation expense from ASV-linked incentive plans and technology expenses." So the bonus plan tied to subscription sales cost more because sales were strong. In Q3, the 10-Q also listed AI token consumption (the cost of running AI models inside FactSet's products) among the technology costs.
The one-off items excluded from adjusted operating income in fiscal 2026:
Adjusted figures also exclude $76.2 million of amortization of acquired intangibles (the accounting write-down of the value of bought businesses). That is a recurring non-cash cost, not a one-off.
Adding back only the one-offs (and keeping amortization in), FactSet's operating margin would have been about 31.5% in fiscal 2026, against about 33.2% the year before. So roughly 2 of the 3.9-point GAAP decline came from one-offs. The other 1.7 points is a real, ongoing margin squeeze.
What the headline numbers hide
Cash is stronger than profit. Operating cash flow was $822.2 million, 1.54 times net income, and free cash flow rose 14.6% to $707.5 million. Part of this is timing. Accrued compensation, meaning bonuses earned this year but not yet paid, rose $62.6 million to $192.4 million (+47%). That cash goes out the door when the bonuses are paid, so it will reverse next year. Stock-based pay of $84.1 million (up from $61.2 million) is a real cost to shareholders that doesn't use cash, and it also flatters cash flow relative to profit. In Q4 alone, operating cash flow fell 3.5% and free cash flow fell 0.5%.
The GAAP vs adjusted gap widened sharply. Adjusted EPS of $18.01 is $3.44 above GAAP EPS, against $1.43 a year earlier. The gap includes $1.60 of intangible amortization, $0.97 of restructuring, $0.41 of CEO awards and $0.34 for writing down an equity investment, partly offset by a $0.14 gain on selling investments.
A prior-year gain makes Q4 look worse than it was. Q4 fiscal 2025 included a gain on selling a business worth $0.52 per share, and Q4 fiscal 2026 carried $0.57 of restructuring (against $0.01). Together those two items more than account for the $0.62 drop in Q4 GAAP EPS; revenue growth and fewer shares made up the difference.
Buybacks did almost all the work on adjusted EPS. Adjusted net income rose just 1.2% ($659.5 million vs $651.6 million). At last year's share count, adjusted EPS would have been about $17.18. The other $0.83 of the $1.03 increase came from the share count being 4.6% lower. FactSet spent $644.0 million on buybacks, more than double last year's $300.5 million.
Shareholder payouts exceeded free cash flow. Buybacks plus $164.2 million of dividends totalled $808 million, about $100 million more than free cash flow. Cash fell to $233.3 million from $337.7 million. Total debt was flat at about $1,370 million, but $499.4 million of it (notes due March 2027) is now due within a year.
Receivables grew faster than sales. Money owed by customers rose 11.4% to $301.4 million while revenue grew 6.7%. Deferred revenue (bills sent for service not yet delivered) rose 9.8%, so part of this is probably larger or earlier billing, consistent with longer contracts. It's worth checking in the 10-K, not yet a red flag.
Tax: the full-year tax rate rose to 17.9% from 17.2%, so taxes did not help EPS this year. In Q4 alone, the rate fell to 16.1% from 18.7% after a favourable resolution of US tax positions, which helped the quarter.
Did last time's read hold up?
Our Q3 report said Q4 needed to show two things: organic ASV growth holding up, and margins returning to the guided 34–35.5% adjusted range, with one-off charges falling away. It also pointed out that the Q3 guidance implied Q4 GAAP operating income of $186–$217 million.
ASV: yes. Organic ASV growth held at 7.0% (7.1% at May 31), and the full-year dollar gain of $168.2 million beat the top of the $130–$160 million target.
Adjusted margin: yes, just. The full-year adjusted margin finished at 34.5%, inside the range. Q4's adjusted margin was 33.0%, down 0.8 points from a year earlier. That is a much smaller decline than Q3's 2.8 points.
One-offs falling away: no. Q4 restructuring charges were $26.9 million, more than Q3's $19.6 million. Q4 GAAP operating income was $156.6 million, well below the $186–$217 million the guidance implied. As a result, full-year GAAP operating margin (28.3%) and GAAP EPS ($14.57) both missed the bottom of the guided ranges (29.5% and $14.85). Revenue ($2,476.3 million) and adjusted EPS ($18.01) beat the top of theirs.
Outlook: fiscal 2027 guidance
Guidance item
FY2027 range
Implied change vs FY2026
Organic ASV growth
5.0% – 6.5%
slower than FY2026's 7.0%
Revenue
$2,600M – $2,625M
+5.0% to +6.0%
GAAP operating margin
31.0% – 32.0%
up from 28.3%
Adjusted operating margin
34.75% – 35.25%
up from 34.5%
GAAP diluted EPS
$17.00 – $17.50
+16.7% to +20.1%
Adjusted diluted EPS
$19.25 – $19.65
+6.9% to +9.1%
Three things stand out:
Management is guiding for slower subscription growth. After a record year, the organic ASV range of 5.0–6.5% sits entirely below this year's 7.0%. Guidance also switched from a dollar target to a percentage. The release gives no reason for the more cautious range.
The big GAAP EPS rebound mostly assumes the one-offs stop. Guided GAAP operating margin of 31–32% is roughly where fiscal 2026 would have been without the one-off charges (about 31.5%). That is a recovery, not an improvement. This year management assumed the charges would end in Q4 and they didn't.
Adjusted EPS growth again leans on share count. Q4's diluted share count (35.6 million) was already 2.8% below the full-year average (36.6 million). So fiscal 2027 starts with about 3 points of per-share growth even with no new buybacks. Guided adjusted operating income ($903–$925 million) grows 5.6% to 8.2%, roughly in line with revenue.
Our view: FactSet's subscription business is in good shape. ASV growth of 7%, retention above 95% and longer contracts all point the same way. The problem is cost: the pay and technology needed to win that growth, including running AI products, have taken 1.8 points off the adjusted margin in a year. The fiscal 2027 plan only asks for a modest margin recovery on slower growth, which looks achievable. The two things to watch in fiscal Q1 2027 (results expected in December, based on FactSet's usual timing) are whether restructuring charges actually stop, and whether organic ASV growth stays nearer 7% than the 5% bottom of the new range.
Takeaway: FactSet had its best subscription-sales year on record (organic ASV +7.0%), but profits didn't follow. Even excluding one-off charges, adjusted operating income rose only 1.4%, and adjusted EPS grew 6.1% mainly because FactSet bought back 4.6% of its shares. Fiscal 2027 guidance assumes slower subscription growth and a margin recovery that depends on restructuring charges finally ending, which management also expected this year and didn't get.