FactSet Slashes FY23 Topline Outlook After Mixed Q2 Results

  • FactSet Research Systems Inc FDS reported second-quarter FY23 sales growth of 19.5% year-on-year to $515.09 million, marginally missing the consensus of $515.47 million.
  • Organic Annual Subscription Value (ASV) plus professional services was $1.9 billion on February 28, 2023, up 9.1% Y/Y.
  • Adjusted EPS of $3.80 beat the consensus of $3.69.
  • GAAP operating margin of 32.9% expanded 430 bps Y/Y. Adjusted operating margin expanded by 330 bps to 37%.
  • FactSet held $477.3 million in cash and equivalents.
  • Adjusted EBITDA increased 35.8% to $199.7 million.
  • "We are pleased with our second-quarter results, reflecting the continued strength of our diverse product portfolio," said Phil Snow, CEO of FactSet. "Our digital platform has allowed us to successfully navigate a challenging operating environment and meet the increased demand for our data and technology."
  • FactSet had suspended share repurchases, except for potential minor repurchases to offset dilution from grants of stock options, until at least the second half of FY23 to prioritize debt repayment.
  • FY23 Outlook: FactSet cuts FY23 revenue outlook to $2.080 billion - $2.100 billion, down from the prior $2.100 billion - $2.115 billion, against the consensus of $2.09 billion.
  • FactSet reiterates adjusted EPS guidance of $14.50 - $14.90 versus the consensus of $14.89.
  • Price Action: FDS shares closed lower by 0.85% at $415.65 on Wednesday.
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