Fair Isaac Corporation (FICO): Business Model Canvas [Dec-2025 Updated]

You're looking at the engine room of modern lending, and honestly, it's a masterclass in high-margin moat building that I've seen few companies replicate. The Fair Isaac Corporation business is built on proprietary AI and regulatory acceptance, driving $1.991 billion in FY2025 revenue, with the core Scores Segment alone hitting $1.169 billion. This isn't just about a number; it's about being the default, trusted measure for 90% of top U.S. lenders, which means their Key Resources and Revenue Streams are deeply entrenched. If you want to see exactly how they lock in that market position through key partnerships with the credit bureaus and a massive R&D spend, check out the full Business Model Canvas breakdown below.

Fair Isaac Corporation (FICO) - Canvas Business Model: Key Partnerships

You're looking at the core relationships that keep Fair Isaac Corporation's engine running, especially as they push new score distribution methods. These aren't just vendor agreements; they are foundational to how the FICO Score reaches the market and how new data streams are integrated. Honestly, the stability of these partnerships dictates a huge chunk of Fair Isaac Corporation's revenue predictability.

Credit Bureaus: The Data Foundation and Distribution Channel

The three major Credit Reporting Agencies (CRAs)-Experian, TransUnion, and Equifax-remain absolutely critical. They are the primary conduits for the data that feeds the FICO Score models and the primary channel for distributing those scores to lenders. While Fair Isaac Corporation is actively trying to bypass some of the distribution layers, the data access itself is non-negotiable. The FICO Score remains the standard measure of consumer credit risk in the U.S., used by 90% of top U.S. lenders. This reliance underscores the delicate balance Fair Isaac Corporation must maintain with these entities, even as new direct licensing models emerge.

The tension is clear with the new Mortgage Direct License Program, which allows tri-merge resellers to calculate and distribute FICO Scores directly, effectively cutting out the CRAs as the mandatory middleman for score delivery in that channel. This move is designed to eliminate markups, but the underlying data access remains a shared dependency.

Plaid: Next-Generation Score Enhancement

The partnership with Plaid, a leading financial data network, is about future-proofing the core product. Fair Isaac Corporation announced a strategic partnership with Plaid in November 2025 to deliver the next generation of the cash flow UltraFICO® Score. This collaboration merges the proven reliability of the FICO Score with real-time cash-flow data from Plaid, aiming for superior consumer risk assessment. This is a clear move to incorporate more modern, non-traditional data sources into the scoring ecosystem.

Cloud Infrastructure and Enterprise Deployment Partners

For platform availability and scale, cloud partnerships are essential. The FICO Platform availability in the Amazon Web Services (AWS) Marketplace is a key route to market for software consumption, driving growth in recurring revenue streams. For instance, Software Annual Recurring Revenue (ARR) for the FICO Platform was up by 20% year-over-year in Q1 Fiscal 2025. This suggests strong uptake through cloud marketplaces like AWS.

For deploying complex enterprise software solutions globally, system integrators are vital. While specific 2025 contract values aren't public, the reliance on global system integrators like Cognizant and Fujitsu is standard practice for large-scale deployment of decision management and analytics software across international banking and insurance clients. These partners translate Fair Isaac Corporation's technology into operational reality for major corporations.

Mortgage Direct License Program and Resellers

The FICO Mortgage Direct License Program fundamentally alters the distribution relationship with tri-merge resellers. Firms like Xactus, or others operating in that space, now have options to bypass the credit bureaus for score calculation and distribution. This is a direct effort to increase price transparency and reduce costs for lenders in the $12 trillion U.S. mortgage industry. The financial incentives offered are stark:

The FICO Score's role in the ecosystem is massive; the company reported Fiscal Year 2025 revenue guidance of $1.98 billion, with Scores revenue increasing by 23% in Q1 Fiscal 2025, driven partly by mortgage origination volumes. This shows the direct financial impact of these distribution channel relationships.

The key partnerships can be summarized by their function:

• Data & Core Distribution: Experian, TransUnion, Equifax
• Next-Gen Data Integration: Plaid (for UltraFICO® Score)
• Cloud Scale & Reach: Amazon Web Services (AWS Marketplace)
• Global Implementation: Cognizant, Fujitsu (System Integrators)
• Channel Disruption & Cost Control: Tri-merge Resellers (e.g., Xactus) under the Direct License Program

Finance: draft 13-week cash view by Friday.

Fair Isaac Corporation (FICO) - Canvas Business Model: Key Activities

Developing and maintaining proprietary predictive analytics and AI models.

Fair Isaac Corporation continues to invest heavily in the core engine of its business, which is the creation and refinement of its analytical models. This activity is directly supported by the continuous expansion of its intellectual property base, which is a key output of this research.

Research and development for new scores like FICO Score 10 T and FICO FFM.

The focus here is on evolving the predictive power of the scores to reflect modern credit behavior, including trended data. The rollout of FICO Score 10 T is a prime example of this activity in action. As of late 2025, mortgage lenders in the Early Adopter Program using FICO Score 10 T for non-GSE loans reported that 51% of mortgages have a higher FICO Score 10 T compared to the Classic FICO Score. Furthermore, FICO announced that beginning in the fourth quarter of 2025, mortgage lenders will only have to provide the FICO 10 T score.

Licensing and managing the FICO Score to maintain its industry standard status.

This activity ensures the ubiquity and trust in the FICO Score brand. The FICO Score remains the standard measure of consumer credit risk in the US, used by 90% of top US lenders. The management of the licensing includes supporting the transition to newer models like FICO Score 10 T, which has achieved key milestones for potential adoption by Fannie Mae and Freddie Mac. Early Adopter Program participants for FICO Score 10 T represent clients with over $264 billion in annualized mortgage originations and approximately $1.43 trillion in eligible mortgage portfolio servicing.

Scaling the FICO Platform SaaS offering and enterprise software sales.

This involves driving adoption of the cloud-native FICO Platform and associated enterprise software solutions. The growth in this area is reflected in the recurring revenue metrics as of mid-2025. You can see the breakdown of performance below.

The Scores segment also showed significant momentum, with revenues reaching $324.3 million in the third quarter of fiscal 2025, a 34% increase year-over-year. For the full fiscal year ending September 30, 2025, Fair Isaac Corporation reported annual revenue of $1.99B, representing 15.91% growth.

Securing and defending intellectual property (over 231 active patents).

Protecting the core algorithms and AI methodologies is a critical activity. Fair Isaac Corporation announced in October 2025 that its patent portfolio now includes 231 U.S. and foreign active patents, with an additional 79 patent applications filed and pending. This portfolio directly enhances core solutions like FICO Falcon Fraud Manager and the FICO Platform, which are used in billions of enterprise decisions globally.

• Patents awarded in 2025 cover Responsible AI, Machine Learning, and Applied Intelligence.
• The portfolio supports technologies used across financial services, insurance, and telecommunications.

Fair Isaac Corporation (FICO) - Canvas Business Model: Key Resources

You're looking at the engine room of Fair Isaac Corporation, the core assets that make their business model work. Honestly, it's a mix of deep-seated intellectual property and massive market acceptance. Let's break down what you're seeing in late 2025.

Proprietary FICO Score algorithms and intellectual property

This is the crown jewel, the secret sauce. Fair Isaac Corporation protects this fiercely as trade secrets, which is why they charge for the score generation. As of October 2025, their patent portfolio is substantial, showing continuous innovation in the space. Fair Isaac Corporation holds 231 U.S. and foreign active patents, with an additional 79 patent applications filed and pending. This IP directly enhances core offerings like FICO Falcon Fraud Manager and the FICO Platform. The company has been building this technological moat since its founding in 1956.

Massive, unique consumer credit data access via the three major credit bureaus

The algorithms are only as good as the data feeding them, and Fair Isaac Corporation has unparalleled access. The FICO Score relies on data compiled by the 'Big Three' credit-reporting bureaus: Experian, Equifax, and TransUnion. This deep, established link to the foundational consumer credit data in the U.S. is a massive barrier to entry for competitors. The Scores segment, which houses this core business, is performing very well; for instance, Q4 2025 Scores segment revenue hit $311.6 million, marking a 25% year-over-year increase.

FICO Platform, a cloud-native AI decisioning and workflow automation engine

This is the modern layer built on top of the scoring legacy. The FICO Platform is clearly a major focus, as it received the highest score in the Current Offering category among 15 AI Decisioning Platform providers evaluated in the Forrester Wave Q2 2025 report. This platform is designed to operationalize AI at scale. Looking at the financials, platform growth is strong: Software Annual Recurring Revenue (ARR) at June 30, 2025, was up 4% year-over-year, but platform ARR specifically grew by 18%. The overall Software segment revenue for Q4 2025 was $204.2 million.

Brand equity and regulatory acceptance; the score is used by 90% of top U.S. lenders

Brand equity translates directly into revenue certainty. The FICO Score is the standard measure of consumer credit risk in the U.S. and is used by 90% of top U.S. lenders. This acceptance is so strong that lenders utilizing the newer FICO Score 10 T have signed up for services covering over $264 billion in annualized mortgage originations and approximately $1.43 trillion in eligible mortgage portfolio servicing as of early 2025. The full fiscal year 2025 revenue for Fair Isaac Corporation reached $1.991 billion.

Highly specialized data scientists and AI/ML engineering talent

The ability to create and maintain these complex models requires specific expertise. While I don't have a headcount for their data scientists as of late 2025, the output of this talent is evident in their patent filings and product leadership. The company's full-year non-GAAP operating margin for fiscal 2025 was 55%, indicating efficient use of this high-value human capital.

Here's a quick look at the scale of the business supporting these resources in the most recent quarter:

The company is definitely leaning into its platform strategy for future growth, which you can see in the guidance for fiscal year 2026 revenue projection of $2.35 billion.

Fair Isaac Corporation (FICO) - Canvas Business Model: Value Propositions

Standardized, trusted measure of consumer credit risk for lending decisions

The FICO score remains the standard measure of consumer credit risk in the U.S., used by 90% of top U.S. lenders. The FICO score range is between 300 and 850. This value proposition is directly reflected in the financial performance of the Scores segment. For the fourth quarter of fiscal 2025, Scores revenues hit $311.6 million, marking a 25% increase year-over-year. For the full fiscal year 2025, Scores segment revenues reached $1,168.58 million, up from $919.65 million in 2024. In Q3 2025 specifically, Scores segment revenues were $324 million, a 34% increase from the prior year, driven in part by a 42% jump in B2B revenues due to higher unit prices and increased mortgage origination volume. The company's new direct-to-lender model charges a flat $4.95 per score and a $33 per borrower fee upon loan closure, a 50% reduction from the traditional $10-per-score reseller model.

AI-powered decisioning and workflow automation for fraud and customer management

The Software segment, which covers analytics and digital decisioning technology, posted revenues of $204.2 million in the fourth quarter of fiscal 2025. Software Annual Recurring Revenue (ARR) on September 30, 2025, stood at $739 million in total, with platform ARR reaching $254 million, representing 34% of the total Q3 ARR. Platform ARR growth in Q4 2025 was 16%. A key innovation here is the FICO Focused Foundation Model (FFM), a generative AI model that delivered more than a 35% lift in world-class transaction analytic models for fraud detection, while needing up to 1,000x fewer resources than conventional gen AI models.

High-performance fraud detection with FICO Falcon Fraud Manager

FICO Falcon Fraud Manager provides real-time transaction protection across all channels. The solution is used to protect 15% of the world's card accounts. The Falcon Intelligence Network includes over 2,121+ global institutions. The top industries using this solution include Insurance and Wealth Management, each with 12 known users, and Credit Cards with 10 known users.

• Monitors all transaction types: credit cards, debit cards, prepaid cards, commercial cards, and digital payments (P2P, real-time).
• Leverages consortium data from more than 10,000 global financial institutions.

Explainable AI (xAI) for transparent, auditable decision-making in regulated industries

The FICO Focused Foundation Model (FFM) is a generative AI model specifically for the financial services domain, emphasizing accuracy and cost efficiency. This investment in explainable AI and machine learning is cited as enhancing competitive differentiation and supporting premium product offerings. The company's overall Software segment saw its Dollar-Based Net Retention Rate at 102% on September 30, 2025, with platform software at 112%.

New scores incorporating alternative data like Buy Now, Pay Later (BNPL)

Fair Isaac Corporation has a history of using alternative data to increase credit access. FICO Score XD was developed to address the 25 million credit invisible consumers by incorporating data outside of traditional credit files. Findings show that 75% of consumers with a FICO Score XD over 620 who obtained credit subsequently maintained a traditional FICO Score of 620 or higher in the following 24 months. The Credit Access and Inclusion Act proposes allowing on-time payments from landlords, utility providers, and telecom companies to be used in credit scoring.

Finance: draft Q1 FY26 guidance impact analysis by next Tuesday.

Fair Isaac Corporation (FICO) - Canvas Business Model: Customer Relationships

You're looking at how Fair Isaac Corporation keeps its biggest clients locked in and how it brings in new ones. It's a mix of deep, long-term contracts with the giants of finance and a growing direct-to-consumer channel. Honestly, the numbers show the B2B side is where the real stickiness is.

Long-term, deeply embedded relationships with major financial institutions

Fair Isaac Corporation maintains relationships that are clearly long-term, evidenced by strong retention metrics across its core business. The FICO Score itself is the standard measure of consumer credit risk in the U.S., used by 90% of top U.S. lenders. This level of adoption suggests deep integration into critical lending workflows.

The financial performance in the Scores segment reflects this embedded nature, with B2B revenue being the primary growth engine. The company operates in more than 80 countries, showing a broad, established global footprint. The overall Dollar-Based Net Retention Rate (NRR) for Q4 2025 was 102%, meaning existing customers spent slightly more than the previous year, even with some usage reductions noted from select Customer Success (CCS) clients.

Here's a look at the core relationship health metrics from the end of Fiscal Year 2025:

Dedicated B2B sales and professional services for complex software implementation

For the FICO Platform, which is central to complex software implementation, the relationship is driven by a land-and-expand strategy, resulting in significant Annual Recurring Revenue (ARR) growth. Professional services revenue is expected to remain at a similar annual level going into Fiscal Year 2026, suggesting stable, project-based engagement alongside recurring software contracts.

The momentum in securing new platform business is clear from the bookings data:

• Platform ARR reached $263 million in Q4 2025.
• Platform ARR growth was 16% year-over-year in Q4 2025.
• Platform ARR made up 35% of total Software ARR in Q4 2025.
• Q4 2025 ACV (Annual Contract Value) bookings hit $32.7 million, the strongest quarter in six years.
• Full-year FY2025 ACV bookings totaled $102 million.

Strategic account management for top-tier global banks (e.g., Capital One, Citi)

While specific client names like Capital One or Citi aren't detailed with relationship metrics, the focus on strategic, high-value accounts is evident through platform adoption and key partnerships. The FICO Platform is being deployed to manage customers across their entire lifecycle, moving beyond single-account decisions. For instance, the strategic collaboration with Amazon Web Services (AWS) is designed to accelerate client adoption of FICO Platform, which runs on AWS, and make solutions available via AWS Marketplace Private Offers. This type of deep, co-selling relationship is characteristic of strategic account management for top-tier clients.

The reliance on FICO solutions for critical functions at major institutions is shown by the fact that mortgage origination revenues, a key B2B driver, accounted for 55% of total B2B revenue in Q4 2025. Furthermore, the company has clients with over $284 billion in annualized mortgage originations signed up for FICO Score 10T as of Q2 2025.

Self-service and subscription model for B2C via myFICO.com

The direct-to-consumer channel via myFICO.com is a growing component of the Scores segment. B2C revenues saw an 8% increase in the fourth quarter of fiscal 2025 compared to the prior year period. This growth is supported by increasing consumer engagement with personal credit education tools.

The consumer relationship is characterized by high engagement:

• Users accessing their FICO Score 8 for free via myFICO increased by nearly 70% over the past year (as of April 2025).
• 74% of Americans believe their financial situation would improve with greater access to personal finance education and tools.

Partner-led channel management for score distribution

Fair Isaac Corporation relies on channel partners to distribute scores to consumers and other entities. The growth in the B2C revenue stream is explicitly attributed to both myFICO.com and these indirect channel partners. This channel management is a key part of the overall scores distribution strategy.

For example, B2C revenue in Q2 2025 showed a 6% increase year-over-year, which management noted was due to increased revenue from these indirect channel partners. The new FICO Mortgage Direct License Program also introduces optionality, potentially cutting average per-score fees by approximately 50% compared to 2025 reseller fees for lenders choosing the performance-based model, which impacts the entire distribution ecosystem.

Finance: draft 13-week cash view by Friday.

Fair Isaac Corporation (FICO) - Canvas Business Model: Channels

You're looking at how Fair Isaac Corporation (FICO) gets its value propositions-the scores and the platform-into the hands of its customers. This is a multi-pronged approach, blending legacy distribution with modern software channels.

The distribution of traditional FICO scores remains heavily reliant on the established credit ecosystem. This is where the bulk of the Scores segment revenue flows, especially from the mortgage sector. The pricing structure here is a key lever for Fair Isaac Corporation.

The direct enterprise sales force is focused on pushing the FICO Platform, which is Fair Isaac Corporation's strategic shift toward a Software-as-a-Service model. This is where Annual Recurring Revenue (ARR) growth is tracked closely.

• Platform ARR growth was 16% year-over-year in Q4 2025.
• Platform ARR represented 35% of total Software ARR in Q4 2025.
• Total Software ARR reached $747 million as of Q4 2025.
• Software segment revenue grew 8% year-over-year in Q1 2025 to $204 million.

The move to bypass the credit bureaus in the mortgage space via the Direct License Program is a major channel evolution. This program directly targets tri-merge resellers, effectively making them direct clients for score calculation.

Cloud Marketplaces are becoming a formalized route for software consumption, especially for the FICO Platform. This aligns with the broader industry trend where B2B buyers use committed cloud spend.

• Fair Isaac Corporation signed a strategic collaboration agreement with Amazon Web Services (AWS) in May 2025.
• FICO solutions, starting with FICO Decision Modeler, are available through AWS Marketplace Private Offers.
• Amazon itself holds an enterprise license for the FICO Xpress optimization suite.

The tri-merge resellers and direct license partners in the mortgage industry are now subject to a new distribution model as of late 2025. This program is exclusive to mortgage lending for now.

Finance: draft 13-week cash view by Friday.

Fair Isaac Corporation (FICO) - Canvas Business Model: Customer Segments

You're looking at the core groups Fair Isaac Corporation serves, the ones that actually pay for the scores and the decisioning software. It's a mix of massive institutions and the growing digital players. Honestly, the numbers show the Scores segment is still the engine, but the Software side, which includes the platform used by many of these customers, is growing too.

Large Financial Institutions (Banks, Credit Unions, Mortgage Lenders)

This group is the bedrock of the Scores business, relying on Fair Isaac Corporation for the standard measure of consumer credit risk. The sheer volume of their activity directly impacts Fair Isaac Corporation's top line. For the full fiscal year 2025, total Scores revenues hit $1.169 billion, marking a 27% increase over the prior year, which was materially driven by Business-to-Business (B2B) scores. You can see the direct link in the mortgage market; in the fourth quarter of fiscal 2025, mortgage origination revenues were up 52% versus the prior year, and these revenues accounted for 55% of B2B revenue and 45% of total Scores revenue for that quarter. This segment is definitely sensitive to interest rate environments, but the pricing power remains strong.

Here's a snapshot of the Scores segment performance, which heavily reflects activity from these large lenders:

Credit Bureaus (Experian, TransUnion, Equifax)

While the credit bureaus are distinct entities, they are critical channel partners for Fair Isaac Corporation's B2B Scores, as they distribute the scores to the ultimate end-users like lenders. The fact that FICO Scores are used by 90% of top U.S. lenders underscores the essential nature of this distribution channel. The growth in B2B scores revenue, up 27% for the full fiscal year 2025, reflects the successful utilization of Fair Isaac Corporation's scores through these channels, even with evolving market dynamics like the push for single-file reports.

Insurance, Telecommunications, and Retail companies (using FICO Platform)

This group primarily consumes Fair Isaac Corporation's Software segment offerings, using the FICO Platform for decisioning outside of traditional lending, such as fraud detection or customer management. While specific revenue breakdowns for these non-financial industries aren't always isolated in the top-line reports, the overall Software segment shows momentum. Platform Annual Recurring Revenue (ARR) reached $263 million year-over-year in Q4 Fiscal 2025, a 16% increase, making up 35% of total ARR. This platform growth is key for these industries, as the FICO® Platform was recognized as a leader in the Q2 2025 Forrester Wave™ for AI Decisioning Platforms, receiving the highest score in current offering among 15 providers evaluated.

Individual Consumers seeking credit monitoring and scores (B2C)

This is the direct-to-consumer side, primarily through myFICO.com and indirect partners. You see this segment's performance reflected in the B2C revenue line within the Scores segment. In Q4 Fiscal 2025, B2C revenue increased 8% from the prior year. This growth was driven by both the myFICO.com business and indirect channel partners. To give you context on the consumer base, the National Average FICO® Score was reported at 715 in the Fall 2025 Credit Insights report. Also, the data shows generational differences in credit health; Gen Z consumers (ages 18-29) saw the largest average FICO® Score decrease, down three points year-over-year.

• Q4 Fiscal 2025 B2C Revenue Growth: 8% year-over-year.
• Q1 Fiscal 2025 B2C Revenue Growth: 3% year-over-year.
• National Average FICO® Score (Fall 2025): 715.

Fintechs and Digital Lending Platforms

Fintechs are a major growth vector, often utilizing the FICO Platform for their rapid decisioning needs. The broader digital lending market is huge; the global fintech lending market was valued at $590 billion in 2025, and about 46% of U.S. consumers used digital lending or finance apps that year. Fair Isaac Corporation's platform is clearly positioned to serve this dynamic space, as evidenced by its leadership recognition in AI Decisioning Platforms. The focus on Platform ARR growth, which was up 16% year-over-year in Q4 FY25, directly correlates with the expansion into these modern, technology-driven lending environments.

Fair Isaac Corporation (FICO) - Canvas Business Model: Cost Structure

You're looking at the major outlays Fair Isaac Corporation (FICO) faces to keep its platform and scores running in late 2025. Honestly, these costs are heavily weighted toward innovation and data access, which makes sense for a company at the core of credit decisioning.

Debt Servicing Costs are based on the balance sheet as of September 30, 2025. The total debt stood at $3.06 billion. With a weighted average interest rate on that debt at 5.27% as of the same date, the annualized interest expense is approximately $161.3 million (calculated as $3.06 billion multiplied by 5.27%).

Data Acquisition and Licensing Costs are a major, though often bundled, expense. The shift in pricing structure highlights the cost dynamics. Under the new FICO Mortgage Direct License Program, the royalty fee for the FICO Score is $4.95 per score under the performance model, which is stated to be a 50% reduction from average per-score fees paid by tri-merge resellers. Alternatively, the per-score model maintains the previous average price of $10 per score. A separate funded loan fee of $33 per borrower per score applies upon closing under the performance model.

High R&D Expenditure is implied by the focus on next-generation products. The FICO focused foundation model (FFM) for fraud detection claims a >35% lift in model performance while requiring up to 1,000x fewer resources than conventional Generative AI models. Full-year Fiscal 2025 revenue was $1.991 billion.

Cloud Infrastructure and Hosting Costs scale with the FICO Platform SaaS delivery. While FICO does not report this specific cost, the market context shows the scale of investment required. Global enterprise spending on cloud computing is projected to exceed $679 billion in 2025, and AI/ML cloud services spending is forecasted at $47.3 billion globally. Platform Annual Recurring Revenue (ARR) for FICO was $263 million as of September 30, 2025.

For Sales, General, and Administrative (SG&A) costs, specific dollar amounts for FY2025 are not detailed in the readily available summaries, but the overall revenue scale is clear.

The cost structure is heavily influenced by the need to maintain competitive platform performance, as evidenced by Platform ARR growing 16% year-over-year to reach $263 million.

• AI/ML Cloud Services Spending (Global Forecast) - $47.3 billion in 2025
• Total Public Cloud Spending (Global Forecast) - Exceeding $679 billion in 2025

The operational costs for SG&A and R&D are embedded within the overall expense structure supporting the $515.8 million in Q4 2025 revenue.

Fair Isaac Corporation (FICO) - Canvas Business Model: Revenue Streams

You're looking at how Fair Isaac Corporation brings in the money, which is definitely shifting with their new direct licensing push. The revenue streams are clearly split between their established Scores business and the growing Software segment.

The Scores Segment revenue is the bedrock, hitting $1.169 billion for the full fiscal year 2025, marking a substantial 27% increase versus the prior year, materially driven by B2B scores. The Software Segment also contributed significantly, reporting full-year revenue of $822 million. Overall, Fair Isaac Corporation posted total fiscal 2025 revenues of $1.991 billion, a 16% increase year-over-year.

The revenue breakdown by segment for the later quarters of fiscal 2025 shows the relative strength:

The Software Segment revenue is increasingly reliant on recurring revenue, which is key for valuation. You see this in the Annual Recurring Revenue (ARR) figures, which represent the annualized revenue run-rate from on-premises and SaaS software agreements.

• Platform ARR, representing products running on the FICO Platform using shared capabilities, reached $263.6 million as of September 30, 2025.
• Platform ARR growth year-over-year as of June 30, 2025, was 18%.
• The Dollar-Based Net Retention Rate (DBNRR) for platform software was 115% on June 30, 2025, showing strong expansion from existing customers.

The Scores Segment revenue is heavily influenced by transactional fees, especially in the mortgage market, which saw a major pricing change effective for 2025. This is where the new direct licensing program comes into play, offering lenders choice.

The two primary pricing structures under the new FICO Mortgage Direct License Program for mortgage originations in 2025 include:

• A wholesale per-score royalty fee set at $4.95 per score.
• A $33 funded loan fee per borrower per score, which applies upon loan closing and replaces previous re-issuance charges.

To be fair, that $4.95 wholesale royalty is what Fair Isaac Corporation collects, which is a significant change from the previous wholesale rate of $3.50. Finance: draft 13-week cash view by Friday.