By Kit Norton
It used to be that if you wanted to buy a home, you needed a FICO score. Now, you can use VantgageScore to apply for a mortgage. And that has put the pressure on FICO stock.
But Fair Isaac, the veteran of credit scoring, isn't running scared.
The company's executives say FICO's prices are now on par with VantageScore and they don't expect to lose business this fiscal year, despite a decision by the federal government that allows that home borrowers to use other credit scores.
VantageScore is a joint venture of credit bureaus Equifax, TransUnion, and Experian.
"We anticipate no loss of volume to Vantage in this fiscal year," CEO William Lansing after on Fair Isaac's earnings conference call on Tuesday.
FICO topped Wall Street's fiscal second-quarter earnings and revenue expectations. The credit bureau reported earnings of $11.14 a share, compared with $6.59 a share last year. Revenue growing 39% to $691.7 million. Wall Street expected $9.26 and $630.2 million, according to FactSet.
For its full fiscal year, FICO projects revenue of $2.45 billion and adjusted earnings of $40.45 a share. Both the updated revenue and profit guidance is slightly below the analyst consensus view of $2.48 billion and $41.34 .
The parity in pricing comes from a move by Fair Isaac to reduce the cost of its newer model credit score, the FICO Score 10T, from $4.95 with a $33 funding fee to 99 cents with a $65 funding fee. The FICO Score 10T incorporates alternative data, such as rent payments, to score borrowers' risk level. VantageScore is priced at 99 cents.
On Wednesday, Wall Street was upbeat about Fair Isaac. The stock was up about 0.7%, to $1,015.39. Shares, though, are down 38% this year and off about 56% from its record closing high of $2382.40 on Nov. 26, 2024, according to Dow Jones Market Data.
The stock's lackluster performance of late reflects a decision by federal housing officials to allow borrowers to use alternative credit scores to apply for mortgage loans. Shares fell 6.4% after the April 22 announcement.
Despite FICO's new pricing and positive outlook, Lansing said it's still unclear how many lenders will shift from FICO to VantageScore.
"We'll see how it turns out. But if you think about the decision process for those who purchase scores, if they're after the most predictive score, 10T is the answer to that," Lansing said.
FICO's rivals were mixed on Wednesday. TransUnion and Equifax edged up 0.2% and 0.3%, respectively. Experian fell 0.8%. The S&P 500 declined 0.2% and the Dow Jones Industrial Average fell 0.7%.
Write to Kit Norton at kit.norton@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
April 29, 2026 12:38 ET (16:38 GMT)
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