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EFX Q2 Earnings Beat Estimates on USIS & Mortgage Growth
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Key Takeaways
USIS revenues rose 17%, led by a 40% jump in mortgage revenues and wider VantageScore adoption.
Workforce Solutions gained 7%, though operating and adjusted EBITDA margins declined y/y.
Equifax doubled its AI savings target to $150 million and agreed to acquire Circulo de Credito.
Equifax Inc. (EFX - Free Report) has reported second-quarter 2026 adjusted earnings of $2.25 per share, up 12.5% year over year. The figure beat the Zacks Consensus Estimate of $2.21 by 1.8%.
Revenues increased 10.6% year over year to $1.7 billion and surpassed the consensus mark by a slight margin. Strong growth in U.S. Information Solutions (USIS), mortgage services and verification offerings supported the results. The company’s new-product Vitality Index was 16%.
EFX share price has increased marginally over the past three months against an 8.2% dip in its industry and a 4.5% rally of the Zacks S&P 500 composite.
Workforce Solutions revenues increased 7% year over year to $705.4 million. Verification Services revenues advanced 7% to $607.6 million, aided by high-double-digit growth in Talent Solutions and Consumer Lending. Workforce Solutions mortgage revenues rose 8%.
Employer Services revenues increased 3% to $97.8 million. The Government business signed new contracts and renewals totaling roughly $300 million in annual contract value during the first half of 2026. About $100 million represented new business, while approximately $200 million came from renewals.
The segment’s operating margin contracted to 44.9% from 46.4% a year earlier. The adjusted EBITDA margin declined to 52.1% from 53.3%, indicating that revenue growth did not fully translate into margin expansion.
Equifax’s USIS Growth Accelerates on Mortgage Demand
USIS revenues climbed 17% year over year to $611.6 million. Online Information Solutions revenues increased 19% to $545.4 million, while Financial Marketing Services revenues grew 4% to $66.2 million.
USIS mortgage revenues rose 40%, benefiting from share gains and the increased adoption of the company’s mortgage scoring products. About 1,300 mortgage lenders were using VantageScore by July 2026, while second-quarter VantageScore transactions totaled 2.2 million, nearly three times the first-quarter level.
The segment’s operating margin was 22.5%, down slightly from 22.6% in the prior-year quarter. The adjusted EBITDA margin fell to 32.8% from 35%, reflecting the impacts of FICO-related mortgage royalty expenses despite strong revenue growth.
EFX’s International Business Gains Across Key Markets
International revenues rose 8% on a reported basis and 4% in local currency to $383.1 million. The Asia Pacific delivered the strongest reported rally, with revenues increasing 17% to $99.7 million. Local-currency growth was 7%, driven by Online B2B and commercial offerings.
Latin America revenues advanced 9% on a reported basis and 3% in local currency to $109 million. Canada revenues grew 6% to $73.3 million, while Europe revenues increased 2% on a reported basis and 1% in local currency to $101.1 million.
The international operating margin expanded to 12.1% from 10.9%. The adjusted EBITDA margin improved 120 basis points to 27.6%, supported by operating leverage and continued new product execution.
Equifax’s Profitability Benefits From Revenue Growth
Adjusted EBITDA increased 10.6% year over year to $552.1 million. The adjusted EBITDA margin remained flat at 32.5%. Excluding FICO mortgage royalties, management indicated that the adjusted EBITDA margin expanded 120 basis points.
Reported net income attributable to Equifax declined 3.9% to $183.9 million. GAAP diluted earnings increased to $1.54 per share from $1.53, helped by a lower diluted share count.
The quarter included a $40-million pre-tax charge, net of expected insurance recoveries, related to a legal settlement associated with a previously disclosed coding issue. Acquisition-related amortization expenses totaled $61.2 million.
EFX Strengthens AI Efforts & Expands in Mexico
The company doubled its 2026-2028 AI-driven cost and capital savings target to $150 million. Equifax is deploying artificial intelligence across product development, technology, operations and support functions to improve productivity, speed and accuracy.
EFX also signed an agreement to acquire Circulo de Credito for an enterprise value of $750 million. The Mexico-based credit bureau generated approximately $134 million in revenues in the 12 months ended June 2026, representing 31% growth, and recorded an adjusted EBITDA margin of roughly 46%. The transaction is expected to close in the fourth quarter of 2026 and be accretive to adjusted earnings in the first year.
Equifax Maintains Its 2026 Revenue Outlook
For the third quarter of 2026, management expects revenues between $1.68 billion and $1.71 billion, suggesting growth of 8.7-10.7%. The guided range’s midpoint ($1.69 billion) meets the current Zack Consensus Estimate.
Adjusted earnings are projected between $2.15 and $2.25 per share. The midpoint ($2.2) of the outlook is marginally lower than the consensus estimate of $2.21. Adjusted EBITDA is expected to be $547-$564 million.
Equifax maintained its full-year revenue guidance of $6.71-$6.78 billion, implying growth of 10.5-11.6%. The guidance’s midpoint ($6.75 billion) is slightly above the Zacks Consensus Estimate of $6.74 billion.
Adjusted earnings are anticipated between $8.39 and $8.69 per share. The midpoint ($8.54) of the outlook is lower than the consensus estimate of $8.56. Adjusted EBITDA is forecast at $2.10-$2.16 billion.
The company expects more than $1 billion in free cash flow and cash conversion above 100% for 2026. During the second quarter, it returned $366 million to shareholders, including $300 million in share repurchases and $66 million in dividends.
FactSet Research Systems Inc. (FDS - Free Report) reported third-quarter fiscal 2026 adjusted earnings of $4.53 per share, beating the Zacks Consensus Estimate of $4.44 by 2%. The figure increased 6.1% from the year-ago quarter.
Revenues of $622.9 million surpassed the consensus mark of $617.2 million by 0.9% and rose 6.4% year over year.
Paychex, Inc. (PAYX - Free Report) posted solid fourth-quarter fiscal 2026 results. Adjusted earnings of $1.32 per share surpassed the consensus estimate of $1.31 by a slight margin and increased 11% from the year-ago quarter.
PAYX’s total revenues of $1.61 billion rose 12% year over year and beat the consensus estimate by a slight margin.
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EFX Q2 Earnings Beat Estimates on USIS & Mortgage Growth
Key Takeaways
Equifax Inc. (EFX - Free Report) has reported second-quarter 2026 adjusted earnings of $2.25 per share, up 12.5% year over year. The figure beat the Zacks Consensus Estimate of $2.21 by 1.8%.
Revenues increased 10.6% year over year to $1.7 billion and surpassed the consensus mark by a slight margin. Strong growth in U.S. Information Solutions (USIS), mortgage services and verification offerings supported the results. The company’s new-product Vitality Index was 16%.
EFX share price has increased marginally over the past three months against an 8.2% dip in its industry and a 4.5% rally of the Zacks S&P 500 composite.
Equifax, Inc. Price, Consensus and EPS Surprise
Equifax, Inc. price-consensus-eps-surprise-chart | Equifax, Inc. Quote
EFX’s Workforce Solutions Revenues Rise 7%
Workforce Solutions revenues increased 7% year over year to $705.4 million. Verification Services revenues advanced 7% to $607.6 million, aided by high-double-digit growth in Talent Solutions and Consumer Lending. Workforce Solutions mortgage revenues rose 8%.
Employer Services revenues increased 3% to $97.8 million. The Government business signed new contracts and renewals totaling roughly $300 million in annual contract value during the first half of 2026. About $100 million represented new business, while approximately $200 million came from renewals.
The segment’s operating margin contracted to 44.9% from 46.4% a year earlier. The adjusted EBITDA margin declined to 52.1% from 53.3%, indicating that revenue growth did not fully translate into margin expansion.
Equifax’s USIS Growth Accelerates on Mortgage Demand
USIS revenues climbed 17% year over year to $611.6 million. Online Information Solutions revenues increased 19% to $545.4 million, while Financial Marketing Services revenues grew 4% to $66.2 million.
USIS mortgage revenues rose 40%, benefiting from share gains and the increased adoption of the company’s mortgage scoring products. About 1,300 mortgage lenders were using VantageScore by July 2026, while second-quarter VantageScore transactions totaled 2.2 million, nearly three times the first-quarter level.
The segment’s operating margin was 22.5%, down slightly from 22.6% in the prior-year quarter. The adjusted EBITDA margin fell to 32.8% from 35%, reflecting the impacts of FICO-related mortgage royalty expenses despite strong revenue growth.
EFX’s International Business Gains Across Key Markets
International revenues rose 8% on a reported basis and 4% in local currency to $383.1 million. The Asia Pacific delivered the strongest reported rally, with revenues increasing 17% to $99.7 million. Local-currency growth was 7%, driven by Online B2B and commercial offerings.
Latin America revenues advanced 9% on a reported basis and 3% in local currency to $109 million. Canada revenues grew 6% to $73.3 million, while Europe revenues increased 2% on a reported basis and 1% in local currency to $101.1 million.
The international operating margin expanded to 12.1% from 10.9%. The adjusted EBITDA margin improved 120 basis points to 27.6%, supported by operating leverage and continued new product execution.
Equifax’s Profitability Benefits From Revenue Growth
Adjusted EBITDA increased 10.6% year over year to $552.1 million. The adjusted EBITDA margin remained flat at 32.5%. Excluding FICO mortgage royalties, management indicated that the adjusted EBITDA margin expanded 120 basis points.
Reported net income attributable to Equifax declined 3.9% to $183.9 million. GAAP diluted earnings increased to $1.54 per share from $1.53, helped by a lower diluted share count.
The quarter included a $40-million pre-tax charge, net of expected insurance recoveries, related to a legal settlement associated with a previously disclosed coding issue. Acquisition-related amortization expenses totaled $61.2 million.
EFX Strengthens AI Efforts & Expands in Mexico
The company doubled its 2026-2028 AI-driven cost and capital savings target to $150 million. Equifax is deploying artificial intelligence across product development, technology, operations and support functions to improve productivity, speed and accuracy.
EFX also signed an agreement to acquire Circulo de Credito for an enterprise value of $750 million. The Mexico-based credit bureau generated approximately $134 million in revenues in the 12 months ended June 2026, representing 31% growth, and recorded an adjusted EBITDA margin of roughly 46%. The transaction is expected to close in the fourth quarter of 2026 and be accretive to adjusted earnings in the first year.
Equifax Maintains Its 2026 Revenue Outlook
For the third quarter of 2026, management expects revenues between $1.68 billion and $1.71 billion, suggesting growth of 8.7-10.7%. The guided range’s midpoint ($1.69 billion) meets the current Zack Consensus Estimate.
Adjusted earnings are projected between $2.15 and $2.25 per share. The midpoint ($2.2) of the outlook is marginally lower than the consensus estimate of $2.21. Adjusted EBITDA is expected to be $547-$564 million.
Equifax maintained its full-year revenue guidance of $6.71-$6.78 billion, implying growth of 10.5-11.6%. The guidance’s midpoint ($6.75 billion) is slightly above the Zacks Consensus Estimate of $6.74 billion.
Adjusted earnings are anticipated between $8.39 and $8.69 per share. The midpoint ($8.54) of the outlook is lower than the consensus estimate of $8.56. Adjusted EBITDA is forecast at $2.10-$2.16 billion.
The company expects more than $1 billion in free cash flow and cash conversion above 100% for 2026. During the second quarter, it returned $366 million to shareholders, including $300 million in share repurchases and $66 million in dividends.
Equifax carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Snapshot
FactSet Research Systems Inc. (FDS - Free Report) reported third-quarter fiscal 2026 adjusted earnings of $4.53 per share, beating the Zacks Consensus Estimate of $4.44 by 2%. The figure increased 6.1% from the year-ago quarter.
Revenues of $622.9 million surpassed the consensus mark of $617.2 million by 0.9% and rose 6.4% year over year.
Paychex, Inc. (PAYX - Free Report) posted solid fourth-quarter fiscal 2026 results. Adjusted earnings of $1.32 per share surpassed the consensus estimate of $1.31 by a slight margin and increased 11% from the year-ago quarter.
PAYX’s total revenues of $1.61 billion rose 12% year over year and beat the consensus estimate by a slight margin.