Q3 2026 Equifax Inc Earnings Call

October 20, 2026

Operator 1: Greetings, and welcome to the Equifax Q3 2026 earnings conference call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation. You may be placed into question queue at any time by pressing star one on your telephone keypad. We ask you please ask one question and one follow-up, then return to the queue. As a reminder, this conference is being recorded. If anyone should require operator assistance, please press star zero on your telephone keypad. It is now my pleasure to turn the call over to Trevor Burns, Senior Vice President, Investor Relations. Trevor, please go ahead.

Operator: Greetings, and welcome to the Equifax Q3 2026 earnings conference call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation. You may be placed into question queue at any time by pressing star one on your telephone keypad. We ask you please ask one question and one follow-up, then return to the queue. As a reminder, this conference is being recorded. If anyone should require operator assistance, please press star zero on your telephone keypad. It is now my pleasure to turn the call over to Trevor Burns, Senior Vice President, Investor Relations. Trevor, please go ahead.

Speaker #1: Greetings, and welcome to the Equifax Q3 2026 earnings conference call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation.

Speaker #1: You may be placed into the question queue at any time by pressing *1 on your telephone keypad. We ask that you please ask one question and one follow-up, and then return to the queue.

Speaker #1: As a reminder, this conference is being recorded. If anyone should require operator assistance, please press *0 on your telephone keypad. It's not my pleasure to turn the call over to Trevor Burns, Senior Vice President of Investor Relations.

Speaker #1: Trevor, please go ahead.

Trevor Burns: Thanks, and good morning. Welcome to today's conference call. I am Trevor Burns. With me today are Mark Begor, Chief Executive Officer, and John Gamble, Chief Financial Officer. Today's call is being recorded, and an archive of the recording will be available later today in the IR Calendar section of the News and Events tab at our investor relations website. During the call, we will be making reference to certain materials that can be found in the Presentations section of the News and Events tab at our IR website. These materials are labeled Q3 2026 Earnings Conference Call. Also, we will be making certain forward-looking statements, including Q4 and full year 2026 guidance, to help you understand Equifax and its business environment. These statements involve a number of risks, uncertainties, and other factors that could cause actual results to differ materially from our expectations.

Speaker #2: Thanks, and good morning. Welcome to today's conference call. I'm Trevor Burns. With me today are Mark Begor, Chief Executive Officer; and John Gamble, Chief Financial Officer.

Speaker #2: Today's call is being recorded. An archive of the recording will be available later today. In the IR calendar section of the news and events tab at our investor relations website.

Speaker #2: During the call, we will be making reference to certain materials that can be found in the presentation section of the News and Events tab on our IR website.

Speaker #2: These materials are labeled "Q3 2026 Earnings Conference Call." We will be making certain forward-looking statements, including fourth quarter and full year 2026 guidance, to help you understand Equifax and its business environment.

Speaker #2: These statements involve a number of risks, uncertainties, and other factors that could cause actual results to differ materially from our expectations. Certain risk factors that may impact our business are set forth in our filings with the SEC, including our 2025 Form 10-K and subsequent filings.

Trevor Burns: Certain risk factors that may impact our business are set forth in our filings with the SEC, including our 2025 Form 10-K and subsequent filings. During this call, we will be referring to certain non-GAAP financial measures, including adjusted EPS, adjusted EBITDA, adjusted EBITDA margins, and cash conversion, which are adjusted for certain items that affect the comparability of our underlying operational performance. All references to EPS, EBITDA margins, and cash conversion are references to non-GAAP measures. These non-GAAP measures are detailed in reconciliation tables, which are included with our earnings release and can be found in the Financial Results section of the Financial Info tab at our investor relations website. Now I would like to turn it over to Mark.

Speaker #2: During this call, we'll be referring to certain non-GAAP financial measures, including adjusted EPS, adjusted EBITDA, adjusted EBITDA margins, and cash conversion, which are adjusted for certain items that affect the comparability of our underlying operational performance.

Speaker #2: All references to EPS, EBITDA, EBITDA margins, and cash conversion are references to non-GAAP measures. These non-GAAP measures are detailed in reconciliation tables which are included with our earnings release and can be found in the financial results section of the financial info tab at our investor relations website.

Speaker #2: Now I'd like to turn it over to Mark.

Mark Begor: Thanks, Trevor. Turning to slide 4, Equifax delivered solid results in Q3 in a challenging mortgage market driven by strong diversified markets revenue growth of over 8% that exceeded our mid-single digit guidance with strong broad-based performance across all three business units. This included improved performance in EWS Government, which grew mid-single digits in the quarter. EBITDA margins were up a very strong 130 basis points, excluding FICO, versus last year from operating leverage, AI productivity, and good cost management, even with the $20 million of mortgage market headwinds in September. EPS grew 11%, and at $2.26 per share was above the high end of our guidance, even with the negative mortgage market impact. A very strong broad-based quarter for Equifax against a challenging mortgage market.

Speaker #3: Thank you, Trevor. During this Form 4, EQUIFAX delivered solid results in the third quarter in a challenging mortgage market driven by strong diversified markets revenue growth of over 8% that exceeded our mid-single-digit guidance with strong broad-based performance across all three business units.

Speaker #3: This included improved performance in WS Government, which grew mid-single digits in the quarter. EBITDA margins were up a very strong 130 basis points excluding FICO versus last year from operating leverage, AI productivity, and good cost management, even with the $20 million of mortgage market headwind in September.

Speaker #3: EPS grew 11%, and at $2.26 per share, was above the high end of our guidance—even with the negative mortgage market impact. A very strong, broad-based quarter for Equifax against a challenging mortgage market.

Mark Begor: This strong performance was delivered despite the significant weakening in the US mortgage market as 30-year fixed mortgage rates increased about 75 basis points since July, which negatively impacted overall mortgage market transaction volumes and Equifax revenue versus our expectation by about $20 million in the quarter, or over 100 basis points versus our July framework. Equifax revenue of $1.693 billion was up 10% on a reported basis and 9% in constant currency and was slightly below the midpoint of our July guidance due to the negative $20 million of mortgage market impact. Ex-FICO mortgage revenue growth of 7% was at the midpoint of our July guidance. Excluding the negative impact of the $20 million of US mortgage market decline in September relative to our July guidance, total Equifax revenue would have been above the top end of our guidance range for the quarter.

Speaker #3: This strong performance was delivered despite the significant weakening in the US mortgage market as 30-year fixed mortgage rates increased about 75 basis points since July, which negatively impacted overall mortgage market transaction volumes and EQUIFAX revenue versus our expectation by about $20 million in the quarter or over $100 basis points versus our July framework.

Speaker #2: Actually, the Equifax revenue of $1.693 billion was up 10% on a reported basis and 9% in constant currency, and was slightly below the midpoint of our July guidance due to the negative $20 million mortgage market impact.

Speaker #3: Actually, on mortgage, revenue growth of 7% was at the midpoint of our July guidance. Excluding the negative

Speaker #2: Impact of the $20 million U.S. mortgage market decline in September relative to our July guidance, total Equifax revenue would have been above the top end of our guidance range for the quarter.

Mark Begor: US mortgage revenue was up 15% in the quarter and up 1% ex FICO, both below our expectations from the higher rate environment in September. John will provide context on the impact of the significant weakening in the US mortgage market on Q4 and in 2027. Equifax returned $158 million of cash to shareholders in the quarter and about $850 million year to date. Share purchases moderated in the quarter at $92 million with the Círculo de Crédito deal expected to close in Q4, bringing year-to-date repurchases to about $650 million on 3.6 million shares or 3% of shares outstanding. Since launching our $3 billion share repurchase program in April of 2025, we have used our excess free cash flow to repurchase $1.6 billion of Equifax stock. We continue to expect strong free cash flow over $1 billion in 2026 and cash conversion over 100%.

Speaker #2: US mortgage revenue was up 15% in the quarter and up 1% ex-FICO, both below our expectations from the higher-rate environment in September. John will provide context on the impact of the significant weakening in the US mortgage market on the fourth quarter and in 2027.

Speaker #3: Equifax returned $158 million of cash to shareholders in the quarter and about $850 million year-to-date. Share purchases moderated in the quarter at $92 million, with the Circulo deal expected to close in the fourth quarter, bringing year-to-date repurchases to about $650 million on 3.6 million shares, or 3% of shares outstanding.

Speaker #3: Since launching our $3 billion share repurchase program in April 2025, we've used our excess free cash flow to repurchase $1.6 billion of Equifax stock.

Speaker #3: We continue to expect strong free cash flow of over $1 billion in 2026, and cash conversion of over 100%. With our financial capacity of over $1.5 billion, we can execute the Circulo to Credito acquisition in the fourth quarter, and continue to repurchase shares while maintaining a strong balance sheet.

Mark Begor: With our financial capacity of over $1.5 billion, we can execute the Círculo de Crédito acquisition in Q4 and continue to repurchase shares while maintaining a strong balance sheet. Turning to slide 5, Workforce Solutions delivered solid results in Q3 with total diversified markets revenue up 9% and total verified diversified markets revenue up a strong 13%. Mortgage revenue was about flat in the quarter versus last year, reflecting the significant weakening in the US mortgage market. EWS mortgage revenue outperformance was high single digits and consistent with H1 from record growth, new products like Income Qualify, and pricing. Internal Workforce Solutions revenue was up 7% in the quarter as the strong diversified markets revenue performance was partially offset by the weakness in the overall US mortgage market. Q3 government revenue was up mid-single digits.

Speaker #2: During this slide 5, workforce solutions delivered solid results in the third quarter with total diversified markets revenue up 9% and total verified diversified markets revenue up a strong 13%.

Speaker #2: Mortgage revenue is about flat in the quarter versus last year, reflecting the significant weakening in the US mortgage market. EWS mortgage revenue outperformance was high single digits and consistent with the first half from record growth, new products like mortgage qualify, and pricing.

Speaker #2: Internal Workforce Solutions revenue was up 7% in the quarter, as the strong Diversified Markets revenue performance was partially offset by the weakness in the overall U.S. mortgage market.

Speaker #2: Third quarter government revenue was up mid-single digits. I'll discuss government in more detail shortly, but we are very pleased with the trajectory of our government revenue growth given the new state wins and our strong deal pipelines and their big $5 billion TAM.

Mark Begor: I will discuss government in more detail shortly, but we are very pleased with the trajectory of our government revenue growth, given new state wins and our strong deal pipelines in their big $5 billion TAM. Talent Solutions revenue grew a very strong over 20% in the quarter and continues to outperform a soft white-collar hiring market with growth in new products, increased product penetration across our incarceration and education data assets, and pricing. The talent team continues to execute very well in their big $5 billion TAM. Consumer lending also had another very strong quarter with high double-digit revenue growth led by card and consumer finance, principally due to penetration and record growth. This is increasingly an important growth vertical for Workforce Solutions as they roll out new solutions in the auto card and P-loan verticals.

Speaker #2: Talent solutions revenue grew a very strong over 20% in the quarter and continues to outperform a soft white-collar hiring market with growth in new products increased product penetration across our incarceration and education data assets and pricing.

Speaker #2: The talent team continues to execute very well in their big $5 billion TAM. Consumer lending also had another very strong quarter, with high double-digit revenue growth led by card and consumer finance, principally due to penetration and record growth.

Speaker #2: This is increasingly an important growth vertical for workforce solutions as they roll out new solutions in the auto, card, and P-lone verticals. Employer services revenue was down 5% in the quarter and as expected due to the suspension of the work opportunity tax credit or WOTSI I program.

Mark Begor: Employer Services revenue was down 5% in the quarter, and as expected, due to the suspension of the Work Opportunity Tax Credit, or WOTC program. Workforce Solutions EBITDA margins of 51.4% were in line with our expectations, despite the revenue impact from the weaker mortgage market. TWN record additions continued to perform well again in Q3 with 223 million total active records, up 12%, and 125 million total current active records up 11%, which represent 110 million unique individuals or SSNs. We expect strong record growth as we exit 2026 and in 2027 from W-2 BC records, as well as alternative record sources like Pension, Gig, and 1099, with significant potential for record additions with 250 million income-producing Americans against our 110 million unique SSNs in the TWN data set at the end of the quarter.

Speaker #2: Workforce solutions EBITDA margins of $51.4% were in line with our expectations despite the revenue impact from the weaker mortgage market. Twin record additions continued to perform well again in the third quarter with $223 million total active records up 12% and $125 million total current active records up 11%, which represent 110 million unique individuals or SSNs.

Speaker #2: We expect strong record growth as we exit 2026 and into 2027 from W-2-based records, as well as alternative record sources like pension, gig, and 1099, with significant potential for record additions. There are 250 million income-producing Americans, compared to our 110 million unique SSNs in the twin dataset at the end of the quarter.

Mark Begor: Turning to slide 6, in 2026, we have made excellent progress with government customers converting our large commercial pipeline with renewals, extending existing relationships, and adding new principally state government customers. As a reminder, we operate in a $5 billion TAM at the federal, state, and local level of principally manual income verifications for delivery of social services. Year to date, the EWS government team has signed agreements with state agencies for the provisioning of income and employment data supporting principally SNAP and CMS, totaling over $550 million in annual contract value, including about $150 million in new business and $400 million in renewals, an extremely strong result that will principally benefit our Workforce Solutions government vertical in 2027.

Speaker #2: Turning to slide 6, in 2026, we made excellent progress with government customers, converting our large commercial pipeline with renewals, extending existing relationships, and adding new, principally state government customers.

Speaker #2: As a reminder, we operate in a $5 billion TAM at the federal, state, and local level of principally manual income verifications for delivery of social services.

Speaker #2: Year-to-date, the EWS government team has signed agreements with state agencies for the provisioning of income and employment data supporting principally SNAP and CMS, totaling over $550 million in annual contract value, including about $150 million in new business and $400 million in renewals. An extremely strong result that will principally benefit our Workforce Solutions government vertical in 2027.

Mark Begor: Our discussions with state agencies continue to be robust and productive, given the strong value proposition from TWN on speed of social service delivery, caseworker productivity, and accuracy of income verifications, which drives a reduction in improper payments and helps states get benefits to those who need them more quickly. Further, we have seen strong engagement from states converting to subscription-based contracts that provide more certainty of spending levels, as well as adding new solutions from Workforce Solutions. For example, Continuous Evaluation for SNAP is a new EWS solution that identifies changes in recipient incomes above program levels to reduce SNAP error rates. Our new CE solution has been added to several recent state contracts.

Speaker #2: Our discussions with state agencies continue to be robust and productive, given the strong value proposition from TWN on speed of social service delivery, caseworker productivity, and accuracy of income verifications, which drives a reduction in improper payments and helps states get benefits to those who need them more quickly.

Speaker #2: Further, we've seen strong engagement from states converting to subscription-based contracts that provide more certainty of spending levels, as well as adding new solutions from Workforce Solutions.

Speaker #2: For example, continuous evaluation for SNAP is a new EWS solution that identifies changes in recipient incomes above program levels to reduce SNAP error rates.

Speaker #2: Our new CE solution has been added to several recent state contracts. We're actively discussing with states how to support verification of hours worked for new OB-3 Medicaid work requirement obligations, beginning in January 2027. Our EWS Complete Income solution supports states' ability to validate income through a single integrated solution that includes The Work Number and other sources of income, such as gig work, self-employed wages, and non-earned income through applicant permission services.

Mark Begor: We are having active discussions with states to support verification of hours worked for new OBBB Medicaid work requirement obligations beginning in January 2027, and our EWS Complete Income solution supports states' ability to validate income through a single integrated solution that includes The Work Number and other sources of income such as gig work, self-employed wages, and non-earned income through applicant permission services. We also have several large new federal opportunities in our deal pipeline. Our strong wins and renewals this year, along with continued strong deal pipelines, reinforces our confidence in the medium and long-term growth opportunities for EWS Government, supporting states in meeting requirements regarding accuracy and frequency of income validation in Medicaid, SNAP, and other social services.

Speaker #2: We also have several large, new federal opportunities in our deal pipeline. Our strong wins in renewals this year, along with continued strong deal pipelines, reinforce our confidence in the medium- and long-term growth opportunities for EWS Government.

Speaker #2: Supporting states in meeting requirements regarding accuracy and frequency of income validation in Medicaid, SNAP, and other social services. The EWS government team is clearly on offense, supporting federal, state, and local customers with their social service program requirements, and has significant opportunities for long-term revenue growth supporting government programs in their big $5 billion TAM.

Mark Begor: The EWS government team is clearly on offense supporting federal, state, and local customers with their social service program requirements and has significant opportunities for long-term revenue growth supporting government programs in their big $5 billion TAM. Turning to slide 7, USIS also delivered a solid quarter with diversified markets revenue growth of 6%, consistent with the solid performance in Q2 and within their long-term framework. B2B revenue was up 5% with high single-digit online growth in FI from stronger volumes, new business, and pricing, and mid-single-digit online growth in auto from pricing and new business wins. We also saw improved growth in commercial and insurance. Within financial marketing services, our offline batch business revenue was up over 10%, led by very strong broad-based growth across marketing, identity and fraud, and account reviews, principally from new business.

Speaker #2: Turning to slide 7, USIS also delivered a solid quarter with diversified markets revenue growth of 6% consistent with the solid performance in the second quarter and within their long-term framework.

Speaker #2: B2B revenue was up 5% with high single-digit online growth in FYI from stronger volumes, new business, and pricing, and mid-single-digit online growth in auto from pricing and new business wins.

Speaker #2: We also saw improved growth in commercial and insurance. Within financial marketing services, our offline batch business revenue was up over 10% led by very strong broad-based growth across marketing, identity, and fraud, and account reviews principally from new business.

Mark Begor: Our consumer direct business continued to deliver strong growth of 9% in the quarter from good subscriber growth in our direct channel and new business wins in our partner channel. USIS mortgage revenue was up 28% and up low single digits ex-FICO against a slowing mortgage market late in the quarter. Relative to the underlying mortgage market, revenue ex-FICO outperformed the underlying mortgage market by high single-digit percentage, driven by share gains in pre-qualification and pre-approval products and pricing. USIS EBITDA margins were 35.4% in the quarter. Excluding FICO royalties, USIS EBITDA margin was 42.4%, up over 320 basis points versus last year and an outstanding performance. The improvement was driven by improved diversified markets revenue growth, strong cost management, and AI-driven productivity. Turning to slide eight. In September, the FHFA accelerated the use of VantageScore for conforming mortgages to all US mortgage lenders.

Speaker #2: Our consumer direct business continued to deliver strong growth of 9% in the quarter, driven by good subscriber growth in our direct channel and new business wins in our partner channel.

Speaker #2: USIS mortgage revenue was up 28% and up low single digits ex FICO against the slowing mortgage market late in the quarter. Relative to the underlying mortgage market, revenue ex FICO outperformed the underlying mortgage market by high single-digit percentages driven by share gains in pre-qualification and pre-approval products and pricing.

Speaker #2: USIS EBITDA margins were 35.4% in the quarter. Excluding FICO royalties, USIS EBITDA margin was 42.4%, up over 320 basis points versus last year, and an outstanding performance.

Speaker #2: The improvement was driven by improved diversified markets revenue growth, strong cost management, and AI-driven productivity. Turning to slide 8, in September, the FHFA accelerated the use of managed score for conforming mortgages to all US mortgage lenders.

Mark Begor: With score choice now available to all US mortgage lenders, we are seeing a rapid adoption of Vantage 4 with about 2,000 mortgage lenders using VantageScore in their underwriting processes, up 7x since April. Since April, our mortgage VantageScore volume is up over 230%. Through September, the bulk of mortgage lenders continue to purchase both the FICO mortgage score and obtain a free VantageScore from Equifax, and therefore our mortgage VantageScore revenue continues to be small. However, we now have over 200 mortgage lenders exclusively using VantageScore and expect more lenders to move to the paid VantageScore model as we move through the Q4 and into 2027 to take advantage of the higher approval rates and the $1 cost of VantageScore from Equifax. As VantageScore mortgage revenue increases, we will share the positive financial impact on Equifax margins and adjust our revenue and margin guidance accordingly.

Speaker #2: With Score Choice now available to all U.S. mortgage lenders, we're seeing rapid adoption of Managed Score, with about 2,000 mortgage lenders using Managed Score in their underwriting processes—up 7x since April.

Speaker #2: And since April, our mortgage managed score volume is up over 230%. Through September, the bulk of mortgage lenders continue to purchase both the FICO mortgage score and obtain a free vantage score from EQUIFAX, and therefore our mortgage vantage score revenue continues to be small.

Speaker #2: However, we now have over 200 mortgage lenders exclusively using VantageScore, and expect more lenders to move to the paid VantageScore model as we move through the fourth quarter and into 2027, to take advantage of the higher approval rates and the $1 cost of Managed Score from Equifax.

Speaker #2: As managed score mortgage revenue increases, we'll share the positive financial impact on Equifax margins and adjust our revenue and mortgage margin guidance accordingly. The strong adoption of VantageScore is driven by the substantial $1 billion annual savings opportunity for mortgage originators and consumers, as well as VantageScore's ability to score more consumers, supporting homeownership.

Mark Begor: The strong adoption of VantageScore is driven by the substantial $1 billion annual savings opportunity for mortgage originators and consumers, as well as VantageScore's ability to score more consumers supporting homeownership. Equifax plans to maintain the $1 VantageScore price through the end of 2028 to continue driving the adoption of the lower priced and higher performing VantageScore. To further provide lenders and brokers with greater flexibility and cost efficiency, two weeks ago, Equifax announced our new Mortgage Score Select product. This new offering enables the mortgage industry to pull an Equifax mortgage credit file without a credit score, or pull the mortgage credit file with the credit score they select for their mortgage banking needs, whether that score is VantageScore 4, Classic FICO, or FICO Score 10T when it is approved.

Speaker #2: EQUIFAX plans to maintain the $1 vantage score price through the end of 2028 to continue driving the adoption of the lower price and higher performing vantage score.

Speaker #2: To further provide lenders and brokers with greater flexibility and cost efficiency, two weeks ago, Equifax announced our new Mortgage Score Select product. This new offering enables the mortgage industry to pull an Equifax mortgage credit file without a credit score, or pull the mortgage credit file with the credit score they select for their mortgage banking needs.

Speaker #2: Whether that score is VantageScore 4, Classic FICO, or FICO Score 10T, you want it as approved. If the lender or broker wants a second look at the mortgage credit file after the initial pull, they are now able to pull the Equifax mortgage credit file again within 24 hours for just $1.

Mark Begor: If the lender or broker wants a second look at the mortgage credit file after the initial pull, they are now able to pull the Equifax mortgage credit file again within 24 hours for just $1, along with the cost of their selected mortgage credit score or without a mortgage credit score as a part of that offering. With Mortgage Score Select, we are helping lenders and brokers achieve two key objectives. First, cost effectively gaining access to more data to support the lending process. Second, qualifying more borrowers based on these expanded data sets. Turning to slide nine. There have been discussions from the FHFA about eliminating the tri-merge credit report requirement and moving to a two-bureau mortgage credit report.

Speaker #2: Along with the cost of their selected mortgage credit score or without a mortgage credit score as a part of that offering. With mortgage score select, we're helping lenders and brokers achieve two key objectives.

Speaker #2: First, cost-effectively gaining access to more data to support the lending process, and second, qualifying more borrowers based on these expanded data sets. Turning to slide 9, there have been discussions from the FHFA about eliminating the tri-merge credit report requirement and moving to a two-bureau mortgage credit report.

Mark Begor: We and the vast majority of industry participants strongly believe the tri-merge credit report is essential to expanding consumer access to credit, lowers mortgage rates for consumers, ensures the safety and soundness of mortgage underwriting. We believe tri-merge is the right solution for consumers, the mortgage industry, and government agencies. We thought it would be helpful to provide more detail on our USIS mortgage revenue and to size the potential impact of a bi-merge change on Equifax if it were to occur. We expect the impact of GSE-related originations moving to bi-merge would be manageable for Equifax, with roughly $80 million of potential annual revenue impact based on 2026 revenue, which includes a FICO score being delivered with each credit file.

Speaker #2: We and the vast majority of industry participants strongly believe the tri-merge credit report is essential to expanding consumer access to credit lowers mortgage rates for consumers, ensures the safety and soundness of mortgage underwriting.

Speaker #2: We believe tri-merge is the right solution for consumers, the mortgage industry, and government agencies. We thought it would be helpful to provide more detail on our USIS mortgage revenue and to size the potential impact of a bi-merge change on Equifax if it were to occur.

Speaker #2: We expect the impact of GSE-related mortgage related originations moving to bi-merge would be manageable for EQUIFAX with roughly $80 million of potential annual revenue impact based on 2026 revenue, which includes the FICO score being delivered with each credit file.

Mark Begor: We have multiple levers to help manage a potential $80 million revenue and $38 million margin impact, given Equifax's unique solutions and assets, including only about 40% of current originations are GSE-related and would be subject to a potential change by the FHFA to bi-merge. We expect FHA and VA, which we estimate participate in about 25% of originations, would retain the tri-merge requirement based on their consistent statements supporting the value of tri-merge. Mortgage lenders would have the option to pull a three or two bureau file in the mortgage underwriting process, and we expect many would continue with 3B to gain the approval rate lifts from the additional data.

Speaker #2: We have multiple levers to help manage a potential $80 million revenue and $38 million margin impact given Equifax's unique solutions and assets, including that only about 40% of current originations are GSE-related and would be subject to a potential change by the FHFA to bi-merge.

Speaker #2: We expect FHA and VA—which we estimate participate in about 25% of originations—would retain the tri-merge requirement, based on their consistent statements supporting the value of tri-merge.

Speaker #2: Mortgage lenders would have the option to pull a three or two-bureau file in the mortgage underwriting process, and we expect many would continue with 3B to gain the approval rate lifts from the additional data.

Mark Begor: Of course, any implementation would take a long time, and Equifax will be advantaged with our unique solutions, including the TWN Indicator or Income Qualify and our NCTUE telco and utility data that we deliver today with the Equifax mortgage credit file at no charge that our competitors cannot match. Of course, our tri-merge go-to-market business will advantage Equifax in this environment. Last, full conversion to VantageScores in mortgage delivers about $35 million of incremental margin to Equifax. Once rates moderate, there's a big $1 billion revenue and $700 million margin upside in a full mortgage market recovery.

Speaker #2: And of course, any implementation would take a long time, and EQUIFAX will be advantaged with our unique solutions, including the twin indicator or income qualify and our NCTUE telco utility data that we deliver today with the EQUIFAX mortgage credit file at no charge that our competitors cannot match.

Speaker #2: And of course, our tri-merge go-to-market business will advantage Equifax in this environment. And last, full conversion to VantageScores in mortgage delivers about $35 million of incremental margin to Equifax.

Speaker #2: And once rates moderate, there's a big $1 billion revenue and $700 million margin upside in a full mortgage market recovery.

Mark Begor: The bar chart provides an approximate breakdown of expected 2026 USIS mortgage revenue. As indicated, about 45% of that revenue is FICO royalty pass-through with no margin, and about 10% is pass-through revenue from the resale of TransUnion Experian trended credit files to our TriMerge business, which is also no margin. This means about 55% of our USIS mortgage revenue is at zero margin. About 30% of revenue is from the sale of Equifax trended credit files sold principally to resellers that create the TriMerge report, but also directly through the Equifax TriMerge report business, which we refer to as hard pull. The trended credit files sold for this purpose have rich data on the consumer and are used for the mortgage approval process.

Speaker #1: The barter provides an approximate

Speaker #2: breakdown of expected 2026 USIS mortgage revenue and is indicated about 45% of that revenue is FICO royalty pass-through, with no margin, and about 10% is pass-through revenue from the resale of transunion experience trended credit files to our tri-merge business, which is also no margin.

Speaker #2: This means about 55% of our USIS mortgage revenue is at zero margin. About 30% of revenue is from the sale of EQUIFAX trended credit files sold principally to resellers that create the tri-merge report, but also directly through the EQUIFAX tri-merge report business, which we refer to as hard pull.

Speaker #2: The trended credit files sold for this purpose have rich data on the consumer and are used for the mortgage approval process. The remaining about 15% of revenue is principally from the sale of EFX credit files for pre-qual or pre-approval products used early in the application by mortgage originators.

Mark Begor: The remaining about 15% of revenue is principally from the sale of EFX credit files for pre-qual or pre-approval products used early in the application by mortgage originators. These principally one-bureau products assist in early evaluation of applications and are defined as soft pull products. Equifax generates very high variable margins from the sales of credit files in these hard and soft pull products. Turning to slide 10, international revenue was up about 7% in constant currency, with a strong 12% Asia-Pacific revenue growth, including Australia up 11%, and 8% Latin American revenue growth. Canada and Europe both delivered 4% revenue growth, with market headwinds in both the Canadian and the UK market impacting overall growth rates. In Latin America, we saw double-digit revenue growth in Peru and Central America, with high single-digit growth in Brazil. International EBITDA margin was 30.9% in the quarter.

Speaker #2: These principally one-bureau products assist in early evaluation of applications and are defined as soft pull products. Equifax generates very high variable margins from the sales of credit files in these hard and soft pull products.

Speaker #1: Previous slide 10, international revenue was up about 7% in constant currency, with a strong 12% Asia Pacific revenue growth, including Australia up 11%, and 8% Latin American revenue growth.

Speaker #1: Canada and Europe both delivered 4% revenue growth, with market headwinds in both the Canadian and UK markets impacting overall growth rates. In Latin America, we saw double-digit revenue growth in Peru and Central America, with high single-digit growth in Brazil.

Speaker #1: And international EBITDA margin was 30.9% in the quarter. Turning to slide 11, in July, we signed a definitive agreement to acquire circulator credito the fastest growing credit bureau in Mexico for an enterprise value of $750 million.

Mark Begor: Turning to slide 11, in July, we signed a definitive agreement to acquire Círculo de Crédito, the fastest growing credit bureau in Mexico, for an enterprise value of $750 million. This acquisition will expand Equifax into the fast-growing Mexico market, the second largest economy in Latin America, and offer Círculo de Crédito customers access to industry-leading Equifax cloud-native capabilities, decision and analytics capabilities, patented EFX.AI technology, and award-winning identity protection and fraud prevention offerings for the development of solutions designed to help customers grow and expand financial inclusion in Mexico. For the last 12 months, including September, Círculo's revenue is up a very strong 24% in delivering 47% EBITDA margins. We expect Círculo to be accretive to Equifax adjusted EPS in the first full year of ownership.

Speaker #1: This acquisition will expand EQUIFAX into the fast-growing Mexico market, the second largest economy in Latin America, and offer circulator credito customers access to industry-leading EQUIFAX cloud-native capabilities.

Speaker #1: Decision and analytics capabilities, patented EFX.AI technology, and award-winning identity protection and fraud prevention offerings for the development of solutions designed to help customers grow and expand financial inclusion in Mexico.

Speaker #1: For the last 12 months, including September, Circulator's revenue is up a very strong 24%, delivering 47% EBITDA margins. We expect Circulator to be accretive to Equifax's suggested EPS in the first full year of ownership. Since 2020, Equifax has invested our strong excess free cash flow in strategic bolt-on acquisitions to drive our financial results and shareholder returns.

Mark Begor: Since 2020, Equifax has invested our strong excess free cash flow and strategic bolt-on acquisitions to drive our financial results and shareholder returns. Including Círculo de Crédito, we have invested nearly $5 billion in 17 bolt-on acquisitions since 2020, with a proven track record of integrating these acquired businesses, like our acquisition of Boa Vista in Brazil three years ago. We are energized to be entering the fast-growing Mexico market with our Círculo acquisition that we expect to close in Q4 of this year. Turning to slide 12, Equifax is executing a broad AI and agentic strategy that leverages EFX.AI along with our cloud-native technology, our Ignite analytics platform, and our unique proprietary data to deliver higher performing EFX.AI-powered scores, models, and products to our customers.

Speaker #1: Including Circulo Credito, we've invested nearly $5 billion and completed 17 bolt-on acquisitions since 2020, with a proven track record of integrating these acquired businesses, like our acquisition of Boa Vista in Brazil three years ago.

Speaker #1: We are energized to be entering the fast-growing Mexico market with our Circulo acquisition, which we expect to close in the fourth quarter of this year.

Speaker #1: Turning to slide 12, Equifax is executing a broad AI and energetic strategy that leverages EFX.AI along with our cloud-native technology, our Ignite Analytics platform, and our unique proprietary data to deliver higher-performing EFX.AI-powered scores, models, and products to our customers.

Mark Begor: In Q3, we delivered a record over 17% new product vitality index leveraging the Equifax Cloud and EFX.AI capabilities, which is above both our 15% 2026 vitality guide and our 10% long-term framework goal for vitality index. Year to date, over 80% of our new products are leveraging EFX.AI capabilities that drove our record 17% vitality index. We are seeing double-digit performance lifts from these EFX.AI-enabled new analytical products, which is driving strong market adoption. This includes the rollout of Ignite AI Advisor and Equifax IQ on our integrated Ignite analytics and InterConnect decisioning global platforms. We are leveraging Equifax IQ capabilities across multiple credit risk, fraud, and collection solutions in several countries, consistently seeing very significant improvements in customer outcomes for these use cases. In Brazil, Equifax IQ is powering collection solutions for multiple large banks, driving an improvement in their collections recovery.

Speaker #1: In the third quarter, we delivered a record over 17% new product vitality index leveraging the EQUIFAX cloud and EFX.AI capabilities which is above both our 15% 2026 vitality guide and our 10% long-term framework goal for vitality index.

Speaker #1: Year to date, over 80% of our new products are leveraging EFX.AI capabilities that drove our record 7% 17% vitality index. We're seeing double-digit performance lifts from these EFX.AI enabled new analytical products which is driving strong market adoption.

Speaker #1: This includes the rollout of Ignite AI Advisor and Equifax IQ on our integrated Ignite Analytics and InterConnect Decisioning global platforms. We are leveraging Equifax IQ capabilities across multiple credit risk, fraud, and collection solutions in several countries, consistently seeing very significant improvements in customer outcomes for these use cases.

Speaker #1: In Brazil, Equifax IQ is powering collection solutions for multiple large banks, driving an improvement in their collections recovery. Similarly, Equifax IQ is powering credit risk solutions in Latin America, driving risk reduction.

Mark Begor: Similarly, Equifax IQ is powering credit risk solutions in Latin America, driving risk reduction. We are continuing to build out the platform capabilities to scale Equifax IQ capabilities and expect Equifax IQ will be commercially available in the US early next year. We are also seeing strong adoption of new products based on differentiated proprietary Equifax data, including our TWN Indicator solution for mortgage and Continuous Evaluation and public safety solutions in EWS government, which are helping support the EWS sequential government revenue growth in the quarter. Turning to slide 13, we continue to see strong execution by the operations and technology teams across Equifax towards our $150 million AI 4 EFX productivity goal, which is delivering margin improvements across the business.

Speaker #1: We are continuing to build out the platform capabilities to scale EQUIFAX IQ capabilities and expect EQUIFAX IQ will be commercially available in the US early next year.

Speaker #1: We are also seeing strong adoption of new products based on differentiated proprietary EQUIFAX data including our twin indicator solution for mortgage and continuous evaluation and public safety solutions in EWS government which are helping support the EWS sequential government revenue growth in the quarter.

Speaker #1: Turning to slide 13, we continue to see strong execution by the Operations Technology teams across Equifax towards our $150 million AI for EFX productivity goal, which is delivering margin improvements across the business.

Mark Begor: In July, we reviewed with you the expanded deployment of AI tools and agents across internal Equifax Product and model development, operations, technology, and our G&A functions, which is driving cost efficiencies across the entire business. Given our strong ex-FICO Q3 EBITDA margin performance of up 130 basis points from operating leverage, cost management, and AI productivity, we are raising our full year EBITDA margin guidance from up 75 basis points to up 100 basis points, or double our long-term framework of 50 basis points, despite the negative about $80 million impact on revenue from the weaker US mortgage market versus our July guidance. We are energized by the rapid deployment of AI tools across Equifax that is driving productivity, and we believe we are still in the early innings of the potential for AI-driven productivity across Equifax.

Speaker #1: In July, we reviewed with you the expanded deployment of AI tools and agents across internal Equifax product and model development, operations, technology, and our GNA functions, which is driving cost efficiencies across the entire business.

Speaker #1: Given our strong ex FICO third quarter EBITDA margin performance of up 130 basis points from operating leverage, cost management, and AI productivity, we are raising our full year EBITDA margin guidance from up 75 basis points to up 100 basis points for a double our long-term framework of 50 basis points despite the negative about 80 million dollar impact on revenue from the weaker US mortgage market versus our July guidance.

Speaker #1: We are energized by the rapid deployment of AI tools across EQUIFAX that's driving productivity and we believe we are still in the early innings of the potential for AI-driven productivity across EQUIFAX.

Mark Begor: Now I would like to turn it over to John to provide our Q4 and full year framework.

Speaker #1: And now I'd like to turn it over to John to provide our fourth quarter and full year framework.

John Gamble: Thanks, Mark. Before we discuss Q4 and calendar year 2026 guidance, I would like to spend a minute discussing the current weakness in the US mortgage market and the impact it has had on Q3 2026 results, as well as Q4 2026 guidance. Mortgage market transaction volume began to decline later in August as interest rates started rising, with the decline accelerating as we moved through September, with 30-year mortgage rates reaching about 7.5% compared to 6.6% when we provided guidance in July. This mortgage market decline, the bulk of which occurred in the H2 of the quarter, drove about $20 million decline versus expectations in US mortgage revenue in the quarter. Our Q4 expectations for US mortgage transactions reflect current run rates and a continuation of the current weak mortgage market conditions. On this basis, Q4 2026 mortgage revenue is down about $60 million versus our July guidance.

Speaker #2: Thanks, Mark. Before we discuss 4Q and calendar year 26 guidance, I'd like to spend a minute discussing the current weakness in the US mortgage market and the impact this had on 3Q 26 results as well as 4Q 26 guidance.

Speaker #2: Mortgage market transaction volume began to decline later in August as interest rates started rising, with the decline accelerating as we move through September with 30-year mortgage rates reaching about 7.5% compared to 6.6% when we provided guidance in July.

Speaker #2: This mortgage market decline, the bulk of which occurred in the second half of the quarter, drove about a $20 million decline versus expectations in U.S. mortgage revenue in the quarter.

Speaker #2: Our fourth quarter expectations for US mortgage transactions reflect current run rates and a continuation of the current weak mortgage market conditions. On this basis, 4Q 26 mortgage revenue is down about 60 million dollars versus our July guidance.

John Gamble: For the full year 2026, total US mortgage revenue is now expected to be about $80 million below our previous guidance, with growth rates down over 500 basis points versus July. Excluding FICO mortgage royalty pass-through revenue, Equifax mortgage revenue will be up slightly versus 2025. This reflects US mortgage market originations of down an estimated 6.5% to 7.5%. As we look forward to 2027, using current mortgage market transaction levels across USIS and EWS and applying normal seasonal factors, 2027 mortgage market transactions, which we believe would be consistent with US originations, would be down on average high single-digit percentage in 2027 versus 2026, principally over the first 8 months of the year.

Speaker #2: For the full year 2026, total U.S. mortgage revenue is now expected to be about $80 million below our previous guidance, with growth rates down over 500 basis points versus July.

Speaker #2: Excluding FICO mortgage royalty pass-through revenue, Equifax mortgage revenue will be up slightly versus 2025. This reflects U.S. mortgage market originations, which are estimated to be down 6.5% to 7.5%.

Speaker #2: As we look forward to 2027, using current mortgage market transaction levels across USIS and EWS and applying normal seasonal factors, 2027 mortgage market transactions which we believe would be consistent with US originations would be down on average high single-digit percentage in 2027 versus 2026.

Speaker #2: Principally over the first eight months of the year. Looking at overall U.S. market conditions, while the U.S. mortgage market has weakened meaningfully since our guidance in July, overall U.S. market conditions impacting the remainder of our businesses remain relatively consistent with the environment we saw in July.

John Gamble: Looking at overall US market conditions, while the US mortgage market has weakened meaningfully since our guidance in July, overall US market conditions impacting the remainder of our businesses remain relatively consistent with the environment we saw in July. Low unemployment continues to support overall consumer financial health. As we have referenced previously, continued higher levels of inflation disproportionately pressured the lower income and subprime consumer demographic, but the majority of consumers continue to be resilient, which is good for Equifax and our customers. We have also not seen financial institutions increase their portfolio management reviews or decrease consumer credit lines, which are actions they typically take when they anticipate an economic downturn.

Speaker #2: Low unemployment continues to support overall consumer financial health. As we have referenced previously, continued higher levels of inflation have disproportionately pressured the lower income and subprime consumer demographic, but the majority of consumers continue to be resilient, which is good for Equifax and our customers.

Speaker #2: We have also not seen financial institutions increase their portfolio management reviews or decrease consumer credit lines, which are actions they typically take when they anticipate an economic downturn.

John Gamble: As we have seen some slowing in FI and auto volumes late in Q3 and as we begin Q4, as well as some slowing in overall hiring activity, we continue to watch this closely, particularly in segments impacted by higher interest rates. Slide 14 provides the specifics of our 2026 full year guidance. As Mark referenced earlier, the Equifax team is executing extremely well. For 2026, we expect to deliver our committed diversified markets revenue growth of high single-digit percent year to year. US mortgage revenue, reflecting the current market conditions we discussed, is expected to be about $80 million below our July guidance, with mortgage revenue ex-FICO royalty pass-through slightly above flat year to year. As a result, Equifax revenue for 2026 at the midpoint is now expected to be $6.661 billion.

Speaker #2: As we have seen some slowing in FI and auto volumes late in 3Q and as we begin 4Q, as well as some slowing in overall hiring activity, we continue to watch this closely, particularly in segments impacted by higher interest rates.

Speaker #2: Slide 14 provides the specifics of our 2026 full-year guidance. As Mark referenced earlier, the Equifax team is executing extremely well. For 2026, we expect to deliver our committed diversified markets revenue growth of high single-digit percent year to year.

Speaker #2: U.S. mortgage revenue, reflecting the current market conditions we discussed, is expected to be about $80 million below our July guidance, with mortgage revenue ex-FICO royalty pass-through slightly above flat year-over-year.

Speaker #2: As a result, EQUIFAX revenue for 2026 at the midpoint is now expected to be 6.661 billion dollars. The EQUIFAX team continues to execute extremely well and delivering improved efficiency, through our AI and broader automation and cost management programs.

John Gamble: The Equifax team continues to execute extremely well in delivering improved efficiency through our AI and broader automation and cost management programs. We are increasing our EBITDA margin ex-FICO mortgage royalty guidance to an increase of 100 basis points in 2026 versus 2025, up from the 75 basis points we guided in July. As a result, we expect to deliver, at the midpoint of our guidance, EBITDA of $2.125 billion and adjusted EPS of $8.50 per share within the guidance range we provided in July, but down slightly from the midpoint as our team offset the significant majority of the gross margin impact of the over $80 million of lower mortgage revenue versus our July guide. As Mark covered earlier, we believe we are in the early innings of opportunities from our AI and agentic implementation, both in driving NPI and in AI-driven cost productivity.

Speaker #2: We are increasing our EBITDA margin, excluding FICO mortgage royalty guidance, to an increase of 100 basis points in 2026 versus 2025, up from the 75 basis points we guided in July.

Speaker #2: As a result, we expect to deliver, at the midpoint of our guidance, EBITDA of $2.125 billion and adjusted EPS of $8.50 per share, within the guidance range we provided in July, but down slightly from the midpoint.

Speaker #2: As our team offset the significant majority of the gross margin impact of the over 80 million dollars of lower mortgage revenue versus our July guide.

Speaker #2: As Mark covered earlier, we believe we are in the early innings of opportunities from our AI and agentic implementation, both in driving NPI and in AI-driven cost productivity.

John Gamble: The acceleration of these benefits is a key focus of our 2027 plans. Slide 14 also provides guidance for BU revenue and EBITDA margins, which reflect both the significant weakening of the US mortgage market as well as Equifax strengthening EBITDA margin performance. In EWS, we now expect revenue growth of up mid-single digit percent. This is below our July guidance of high single-digit percent growth solely related to the decline in mortgage revenue. We continue to expect EWS diversified markets revenue to grow high single digits and Verifier diversified to grow low double digits consistent with our July guidance. Consistent with our July guidance, we continue to expect adjusted EBITDA margins to be about flat year to year. In USIS, we continue to expect revenue to grow mid-teens percentage, but at the very bottom end of the range, given lower mortgage revenue.

Speaker #2: The acceleration of these benefits is a key focus of our 2027 plans. Slide 14 also provides guidance for BU revenue and EBITDA margins, which reflect both the significant weakening of the U.S. mortgage market as well as Equifax strengthening EBITDA margin performance.

Speaker #2: In EWS, we now expect revenue growth of up mid single-digit percent. This is below our July guidance of high single-digit percent growth solely related to the decline in mortgage revenue.

Speaker #2: We continue to expect EWS diversified markets revenue to grow high single digits and verifier diversified to grow low double digits consistent with our July guidance.

Speaker #2: Consistent with our July guidance, we continue to expect adjusted EBITDA margins to be about flat year to year. In USIS, we continue to expect revenue to grow mid-teens percentage but at the very bottom end of the range given lower mortgage revenue.

John Gamble: We made no changes to our mid-single-digit diversified markets revenue growth expectation. EBITDA margins ex FICO mortgage royalties are over 40% and up strongly reflecting good cost management and continued good progress in AI and other automation and cost structure management programs. International guidance is essentially unchanged from July. In 2026, we expect to deliver over $1 billion of free cash flow and a cash flow conversion of at least 100%. With EBITDA of about $2.1 billion at the midpoint and strong free cash flow, this creates $1.5 billion in capital available in 2026 for M&A and return of cash to shareholders while maintaining debt leverage at about 3x EBITDA. As referenced earlier, this provides the capability for us to complete the Círculo acquisition as planned in Q4 2026, while still executing share repurchases in Q4 2026. Slide 15 provides the details of our Q4 2026 guidance.

Speaker #2: We made no changes to our mid single-digit diversified markets revenue growth expectation. And EBITDA margins ex FICO mortgage royalties are over 40% and up strongly reflecting good cost management and continued good progress in AI and other automation and cost structure management programs.

Speaker #2: International guidance is essentially unchanged from July. In 2026, we expect to deliver over $1 billion of free cash flow and a cash flow conversion of at least 100%.

Speaker #2: With EBITDA of about $2.1 billion at the midpoint and strong free cash flow, this creates $1.5 billion in capital available in 2026 for M&A and return of cash to shareholders while maintaining debt leverage at about three times EBITDA.

Speaker #2: As referenced earlier, this provides the capability for us to complete the Circular acquisition as planned in Q4 2026, while still executing share repurchases in Q4 2026.

Speaker #2: Slide 15 provides the details of our Q4 2026 guidance. In Q4 2026, we expect total Equifax revenue to be between $1.605 and $1.635 billion, up about 4.5% on a reported basis year-over-year at the midpoint.

John Gamble: In Q4 2026, we expect total Equifax revenue to be between $1.605 and $1.635 billion, up about 4.5% on a reported basis year to year at the midpoint. Excluding the impact of FICO mortgage scores, Q4 2026 reported revenue is expected to be up about 3% at the midpoint. Diversified markets revenue is expected to be up 6% to 7% on a reported basis. US mortgage revenue, per my previous comments, is expected to be about $60 million weaker than our expectations when we gave guidance in July, reflecting substantial decline in the US mortgage market. US mortgage revenue is expected to be down mid-single digits percent year to year. US mortgage revenue, excluding FICO mortgage royalty-related revenue, is expected to be down mid-double digit percent year to year.

Speaker #2: Excluding the impact of FICO mortgage scores 4Q26 reported revenue is expected to be up about 3% at the midpoint. Diversified markets revenue is expected to be up 6 to 7% on a reported basis.

Speaker #2: US mortgage revenue per my previous comments is expected to be about $60 million weaker than our expectations when we gave guidance in July reflecting substantial decline in the US mortgage market.

Speaker #2: U.S. mortgage revenue is expected to be down by mid-single digits percent year over year. U.S. mortgage revenue, excluding FICO mortgage royalty-related revenue, is expected to be down by mid-double digits percent year over year.

John Gamble: EBITDA margins, ex FICO mortgage royalties, are expected to expand about 90 basis points year to year at the midpoint, again, reflecting strong execution on our AI and automation programs and broader cost management initiatives. Equifax Q4 2026 EBITDA dollars are expected to be $529 to $546 million, up almost 6% at the midpoint. EPS in Q4 2026 is expected to be $2.07 to $2.17 per share, up about 1.7% versus Q4 2025 at the midpoint. Q4 2026 EPS growth is lower than EBITDA dollar growth, given increased depreciation expense related to transformation assets going into service and a slightly higher tax rate. We believe that our full year and Q4 2026 guidance are centered at the midpoint of both our revenue and EPS guidance ranges.

Speaker #2: EBITDA margins ex FICO mortgage royalties are expected to expand about 90 basis points year to year at the midpoint. Again, reflecting strong execution on our AI and automation programs and broader cost management initiatives.

Speaker #2: Equifax fourth quarter 2026 EBITDA dollars are expected to be $529 to $546 million, up almost 6% at the midpoint. EPS in Q4 2026 is expected to be $2.07 to $2.17 per share, up about 1.7% versus Q4 2025 at the midpoint.

Speaker #2: Q4 '26 EPS growth is lower than EBITDA dollar growth given increased depreciation expense related to transformation assets going into service, and a slightly higher tax rate.

Speaker #2: We believe that our full-year and Q4 2026 guidance are centered at the midpoint of both our revenue and EPS guidance ranges. As a reminder, our guidance for Q4 2026 and fiscal year 2026 assumes Equifax will calculate and sell FICO scores for all mortgage credit transactions, and there will be limited VantageScore revenue.

John Gamble: As a reminder, our guidance for Q4 2026 and fiscal year 2026 assumes Equifax will calculate and sell FICO scores for all mortgage credit transactions, and there will be limited VantageScore revenue. Now I'd like to turn it back over to Mark.

Speaker #2: Now I'd like to turn it back over to Mark.

Mark Begor: Thanks, John. Wrapping up on slide 16, the Equifax team executed very well in Q3 against our EFX 2028 strategic priorities, despite the weaker mortgage market. The new Equifax is leveraging Equifax Cloud, EFX.AI, and proprietary data assets to accelerate innovation and help our customers grow. Our broad-based Q3 diversified market revenue growth of 8% and 130 basis points of EBITDA margin expansion from operating leverage and AI 4 EFX productivity savings are strong indicators of the broad-based Equifax operating model. We delivered above our EBITDA dollar and EPS guidance ranges, despite the impact of the -$20 million from the decline in the US mortgage market in Q3.

Speaker #1: Thanks, John. Wrapping up on slide 16, the EQUIFAX team executed very well in the third quarter against our EFX 2028 strategic priorities despite the weaker mortgage market.

Speaker #1: The new EQUIFAX is leveraging the EFX cloud. EFX.AI and proprietary data assets to accelerate innovation and help our customers grow. Our broad-based third quarter diversified market revenue growth of 8% and $130 basis points of EBITDA margin expansion from operating leverage and AI for EFX productivity savings are strong indicators of the broad-based EQUIFAX operating model.

Speaker #1: We delivered above our EBITDA dollar and EPX guidance ranges, despite the impact of the negative $20 million from the decline in the U.S. mortgage market in the third quarter.

Mark Begor: Our updated 100 basis point ex FICO margin expansion guide for the year driven by strong cost management and AI productivity is up 25 basis points from our 75 basis point framework and twice our long-term goal of 50 basis points from strong cost management and AI-driven productivity, despite the -$80 million impact from the weaker mortgage market in the balance of 2026. Thanks to cloud, Equifax is deploying AI to power higher performing and differentiated solutions for our customers, and AI 4 EFX is in new gear for margin expansion and free cash flow acceleration as we deploy AI inside of Equifax for cost productivity. Our big cloud investment is a foundation for enabling rapid deployment of AI, and we are still in the early innings of our rollout.

Speaker #1: Our updated 100 basis point ex FICO margin expansion guide for the year from strong driven by strong cost management AI productivity is up 25 basis points from our $75 basis point framework and twice our long-term goal of 50 basis points from strong cost management and AI driven productivity despite the negative $80 million impact from the weaker mortgage market in the balance of 2026.

Speaker #1: Price Cloud EFX is deploying AI to power higher-performing and differentiated solutions for our customers. AI for EFX is a new gear for margin expansion and free cash flow acceleration, as we deploy AI inside of Equifax for cost productivity.

Speaker #1: Our big cloud foundation is the our big cloud investment is the foundation for enabling rapid deployment of AI and we are still in the early innings of our rollout.

Mark Begor: Our diversified markets momentum, driven by our strong AI-enabled NPI rollouts and continued execution of AI 4 EFX productivity, gives us strong confidence and momentum as we finish the year and look forward to 2027. In Q4, we expect to deliver approaching 100 basis points of margin expansion from continued strong diversified markets revenue growth and AI 4 EFX productivity. Our focus continues to be delivering financial results consistent with our long-term framework with organic revenue growth of 7% to 10% and at least 50 basis points of margin expansion from broad based AI-powered BU revenue growth of low double digits in EWS, 6% to 8% in USIS, and 7% to 9% in international.

Speaker #1: Our diversified markets' momentum, driven by our strong AI-enabled NPI rollouts and continued execution of AI for EFX productivity, gives us strong confidence and momentum as we finish the year and look forward to 2027.

Speaker #1: And the fourth quarter we expect to deliver approaching 100 basis points of margin expansion from continued strong diversified markets revenue growth and AI for EFX productivity.

Speaker #1: Our focus continues to be delivering financial results consistent with our long-term framework with organic revenue growth of 70 to 10% and at least 50 basis points of margin expansion from broad-based AI powered VU revenue growth of low double digits in EWS 6 to 8% in USIS and 7 to 9% in international.

Mark Begor: The Equifax Cloud and EFX.AI give us continued confidence to innovate with our customers to exceed the 10% Vitality Index goal with new solutions like TWN Indicator and our suite of AI-enabled solutions like Ignite AI Advisor and Equifax IQ. Our operating leverage, strong post-cloud AI cost management, and AI-driven productivity are powering our margins and free cash flow. Given our strong free cash flow generation with cash conversion over 100% in 2026, we are also delivering on our commitment to return substantial free cash flow to shareholders. So far in 2026, we have returned $850 million to shareholders, and in the Q4, we can complete the Círculo de Crédito acquisition and continue healthy share repurchases while maintaining our strong balance sheet.

Speaker #1: The EFX Cloud and EFX.AI give us continued confidence to innovate with our customers to exceed the 10% Vitality Index goal with new solutions like Twin Indicator, and our suite of AI-enabled solutions like AI Ignite Advisor and Equifax IQ.

Speaker #1: And our operating leverage, strong post cloud AI cost management and AI driven productivity are powering our margins and free cash flow. Given our strong free cash flow generation, with cash conversion over 100% in 2026, we're also delivering on our commitment to return substantial free cash flow to shareholders.

Speaker #1: So far in 2026, we've returned $850 million to shareholders, and in the fourth quarter we can complete the Circular acquisition and continue healthy share repurchases while maintaining our strong balance sheet.

Mark Begor: As a reminder, while hard to see today with the Middle East conflict driving inflation and interest rates, these macro factors will resolve in the future and bring rates down and mortgage activity back up. Even at lower levels of mortgage activity, the pipeline of higher rate mortgages grows every week for future refis when rates contract with over 17 million mortgages now over 6%. With AI powering Equifax on the top and bottom line, we are clear that in a mortgage market recovery, the incremental revenue margin and free cash flow from mortgage upside will flow to our investors. Equifax is poised to deliver upwards of $1 billion of incremental mortgage market revenue and $700 million of incremental margin expansion that will drop to our EPS and free cash flow when rates contract.

Speaker #1: And as a reminder, while hard to see today with the Middle East conflict driving inflation and interest rates, these macro factors were resolved in the future and bring rates down and mortgage activity back up.

Speaker #1: Even at lower levels of mortgage activity, the pipeline of higher-rate mortgages grows every week for future refis when rates contract, with over 17 million mortgages now over 6%.

Speaker #1: With AI powering EQUIFAX on the top and bottom line, we are clear that in a mortgage market recovery, that the incremental revenue margin and free cash flow from mortgage upside will flow to our investors.

Speaker #1: EQUIFAX is poised to deliver upwards of a billion dollars of incremental mortgage market revenue and $700 million of incremental margin expansion that will drop to our EPS and free cash flow when rates contract.

Mark Begor: We are investing at the right levels for Equifax growth today, and AI-driven productivity is improving our operating leverage. The incremental $700 million of free cash flow for mortgage market recovery will be delivered to investors from accelerated dividend growth and share repurchases and drive incremental shareholder returns. I am energized about our execution and performance in the quarter and how AI is powering our top and bottom line, but I am even more energized about the future of the new Equifax. With that, operator, let me open it up for questions.

Speaker #1: We are investing at the right levels for Equifax growth today, and AI-driven productivity is improving our operating leverage. The incremental $700 million of free cash flow from mortgage market recovery will be delivered to investors through accelerated dividend growth and share repurchases, driving incremental shareholder returns.

Speaker #1: I'm energized about our execution and performance in the quarter and how AI is powering our top and bottom line but I'm even more energized about the future of the new EQUIFAX.

Speaker #1: And with that, Operator, let me open it up for questions.

Operator 1: Certainly. We will now be conducting a question and answer session. If you would like to be placed into question queue, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. We ask you please ask one question and one follow-up, then return to the queue. Once again, that is star one to be placed into question queue. Our first question today is coming from Jeff Meuler from Baird. Your line is now live.

Operator: Certainly. We will now be conducting a question and answer session. If you would like to be placed into question queue, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. We ask you please ask one question and one follow-up, then return to the queue. Once again, that is star one to be placed into question queue. Our first question today is coming from Jeff Meuler from Baird. Your line is now live.

Speaker #2: Certainly. Without conducting a question and answer session, if you'd like to be placed into question queue, please press star one on your telephone keypad.

Speaker #2: A confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove your question from the queue.

Speaker #2: We ask you please ask one question in one follow-up and return to the queue and once again

Speaker #4: that star 1s be placed into question queue. Our first question today is coming from Jeff Mueller from Baird. Your line is now live.

Jeff Meuler: Yeah, thank you. Good morning. Really good job here on margins. I hear you that you are early innings on AI productivity. Can you just maybe help us think through any puts and takes for 2027? Mortgage volumes are obviously one. I do not know if there is any other grow-over considerations, if there are one-time adjustments this year to incentive comp accruals because of what is going on in mortgage or anything like that. But it seems like there is good momentum on the AI productivity side that should continue to build. So just trying to think through margins holistically.

Speaker #5: Yeah, thank you. Good morning. Hey, really good job here on margins. I hear you that you're early innings on AI productivity. Can you just maybe help us think through any puts and takes for 2027?

Speaker #5: Mortgage volumes are obviously one. I don't know if there's any other like grow-over considerations, if there's like one-time adjustments this year to incentive comp accruals.

Speaker #5: Because of what's going on in mortgage or anything like that. But it seems like there's good momentum on the AI productivity side that should continue to build.

Speaker #5: So, just trying to think through margins holistically. Yeah, thanks, Jeff. We're very pleased with the momentum that we have on our cost management and AI productivity.

Mark Begor: Yeah. Thanks, Jeff. We are very pleased with the momentum that we have on our cost management and AI productivity. As you know, back in February, we set out a $75 million goal over the next couple of years for net cost out from AI productivity. We doubled that in July to $150 million because of the momentum we have. We are just really pleased with the momentum in a post-cloud world. As you know, we invested heavily in our tech, so our team and our infrastructure is highly tech-enabled with that huge investment we made over the last five years. We are just seeing our ability to deploy AI in operations and technology and our support functions really scaling very rapidly.

Speaker #5: As you know, back in February, we set out a $75 million goal over the next couple of years. You know, for cost out, net cost out from AI productivity.

Speaker #5: We doubled that in July to $150 million to give us, you know, because of the momentum we have. And we're just really pleased with you know, the momentum in a post-cloud world.

Speaker #5: As you know, we invested heavily in our tech, so our team and our infrastructure is highly tech-enabled, you know, with that huge investment we made over the last 5 years.

Speaker #5: And we're just seeing our ability to deploy AI in operations and technology and our support functions, you know, really scaling very rapidly. And, you know, I think you're pleased, so are we, that it's showing up in our margins this year, even with the headwinds.

Mark Begor: I think you are pleased, so are we, that it is showing up in our margins this year, even with the headwinds of the mortgage market in September and in Q4 that are quite substantial. We are still increasing our mortgage guide for the year, and we believe that gives us real momentum and confidence as we move into 2027. We are not ready to give guidance in 2027. We will do that in February. But clearly, if mortgage rates stay where they are, mortgage activity will be down in 2027, as John Gamble laid out. Outside of that, we do not think about anything else as being kind of meaningful on a year-over-year basis. Our momentum in our diversified markets is very strong.

Speaker #5: You know, of the mortgage market, you know, in September and in the 4th quarter that are quite substantial. You know, we're still increasing our mortgage guide for the year.

Speaker #5: And, you know, we believe that gives us real momentum and confidence as we move into 2027. You know, we're not ready to give guidance for 2027.

Speaker #5: We'll do that in February. But, you know, clearly, if mortgage rates stay where they are, mortgage activity will be down in 2027, as John laid out.

Speaker #5: Outside of that, you know, we don't think about anything else as being, you know, kind of meaningful on a year-over-year basis. Our momentum in our diversified markets is very strong.

Mark Begor: We see real momentum in EWS as we kind of move through the year and into Q4 on their path back to their long-term framework growth, which I think is really positive. USIS is inside of their LTFF and performing well, and the same with international. So we are pleased with that. In mortgage specifically, while activity at current levels, if that continues in 2027, that would clearly be a meaningful negative that we will all be able to size. We have the positive of Vantage conversion when we look to 2027, and I am sure you are thinking about that just as we are. That momentum is super strong. When the FHFA opened up the LLPA tables a few weeks ago, what we are hearing from our mortgage customers is they are going to move to the $1 Vantage to take advantage of that significant price delta versus the FICO score.

Speaker #5: You know, we see real momentum in EWS as we kind of move through the year and into the fourth quarter, you know, on their path back to their long-term framework growth, which I think is really positive.

Speaker #5: USIS, you know, is inside of their LTFF and performing well, and the same, you know, with International, you know, so we're pleased with that.

Speaker #5: You know, in mortgage specifically, while activity at current levels, you know, if that continues in '27, that would clearly be a meaningful negative that, you know, we'll all be able to size.

Mark Begor: We have the positive of Vantage conversion when we look to 2027, and I am sure you are thinking about that just as we are. That momentum is super strong. When the FHFA opened up the LLPA tables a few weeks ago, what we are hearing from our mortgage customers is they are going to move to the $1 Vantage to take advantage of that significant price delta versus the FICO score.

Speaker #5: We have the positive of Vantage conversion. You know, when we look to '27—and I'm sure you're thinking about that just as we are—that momentum is super strong.

Speaker #5: And, you know, when the FHFA opened up, you know, the LLPA tables, you know, a few weeks ago, what we're hearing from our mortgage customers is they're going to move to the $1 vantage to take advantage of that significant price delta versus the FICO score.

Mark Begor: That is something that should be a positive for us in 2027, and we will size that when we get to February.

Speaker #5: So, you know, that's something that should be a positive for us in 2027, and we'll size that when we get to February. And you specifically asked about AIP—how our bonuses work.

John Gamble: You specifically asked about AIP, how our bonuses work. Just so you are aware, the bulk of our bonuses are paid based on EPS, operating profit, and individual performance objectives. As you know, our operating profit and EPS performance for the year looks very similar to where we started back in February.

Speaker #5: And just so you're aware, the bulk of our bonuses are paid based on EPS, operating profit, and individual performance objectives. And as you know, our operating profit and EPS performance for the year looks very similar to where we started back in February.

Jeff Meuler: Very helpful. Then just with the personal AI agent roll-ups and adoption that has been happening recently, could you just comment on how you are thinking through potential impacts on your business or your customers, things like inquiry volumes in any verticals? I do not know, anything on identity solutions or potentially something on TWN data or alternatives if agentic removes friction. Thank you.

Speaker #5: Very helpful. And then just with the personal AI agent, rollouts and adoption that has been happening recently. Can you just comment on how you're thinking through potential impacts on your business or your customers, things like inquiry volumes in any verticals?

Speaker #5: I know anything on identity solutions or potentially something on, like, twin data or alternatives if Agentic removes friction. Thank you. Yeah, it's still super early days on that, Jeff, from a customer perspective.

Mark Begor: Yeah, it is still super early days on that, Jeff, from a customer perspective. Obviously, everyone is talking about it. Everyone is focused on it. We are investing heavily to be enabled to interact in that way. I would tell you there is very little activity right now, although lots of discussions with our customers. So we want to be prepared and really built for it. Because of our big tech investment and the AI enablement that we have really broadly across Equifax, we think we will be ready when it moves forward. We think about it as a net positive in the future.

Speaker #5: Obviously, everyone's talking about it, everyone's, you know, focused on it. You know, we're investing heavily to be able to interact in that way. I would tell you there's very little activity right now, although lots of discussions with our customers.

Speaker #5: So we want to be prepared and really built for it. And because of our big tech investment, and the AI enablement that we have really broadly across Equifax, we think we'll be ready when it moves forward.

Speaker #5: We think about it as a net positive in the future. Think about '27, '28, '29, as that enables, you know, the ability for our customers to more rapidly utilize our unique solutions. You know, that becomes advantageous to us because, as you know, there's a lot of friction around change with our customers when they want to use one of our new, higher-performing scores, one of our new, higher-performing models, or some of our products that deliver more value.

Mark Begor: Think about 2027, 2028, 2029, as that enables the ability for our customers to more rapidly utilize our unique solutions, that becomes advantageous to us because as you know, there is a lot of friction around change with our customers when they want to use one of our new higher-performing scores, one of our new higher-performing models or some of our products that deliver more value. We view AI as something that is going to be accretive, not only to our top line, but also our bottom line. We already talked about in your first question about AI cost efficiencies and productivity inside of Equifax on how we operate in tech and operations. That clearly is a big deal and part of the $150 million we have laid out as a multi-year cost-out goal.

Speaker #5: So You know, we view AI as something that's going to be accretive not only to our top line but also our bottom line. We already talked about your first question about, you know, kind of AI cost efficiencies and productivity inside of Equifax on how we operate.

Speaker #5: In tech and operations, you know, that clearly is a big deal and part of the $150 million we've laid out as a multi-year cost-out goal.

Mark Begor: As I said, and I think John said also, it is still early innings for that, meaning we are continuing to see positive momentum as far as deployment in our ability to achieve the $150 million and look for going north of that. On the product side, really great work by our team to AI enable a lot of our solutions. You now have our new products being rolled out that have AI capabilities in them as you described, but also AI performance lifts because we are adding more data into the solutions, which is also a big positive for us. As you know, we talked about our Vitality Index, which continues to scale. 17% in the quarter was actually a record for Equifax. We have never been that high.

Speaker #5: And as I said, and I think John said also, it's still early innings for that, meaning we're continuing to see positive momentum as far as deployment in our ability to achieve the $150 million and look for going north of that.

Speaker #5: And on the product side, you know, really great work by our team to AI-enable a lot of our solutions. You know, you have now have, you know, our new products being rolled out that have AI capabilities in them as you described, but also AI performance lifts because we're adding more data into the solutions, which is also a big positive for us.

Speaker #5: You know, as you know, we talked about our Vitality Index, which continues to scale. Seventeen percent in the quarter was actually a record for Equifax.

Speaker #5: We've never been that high. And, you know, in a post-cloud Equifax environment, in all our focus on innovation, new products, leveraging our differentiated data and AI enabling those solutions, you know, that 17%, you know, is a great momentum for us as we move through the quarter and into 2027.

Mark Begor: In a post-cloud Equifax environment and all our focus on innovation, new products, leveraging our differentiated data and AI enabling those solutions, that 17% is a great momentum for us as we move through the quarter and into 2027.

Operator 1: Thank you. Our next question today is coming from Toni Kaplan from Morgan Stanley. Your line is now live.

Operator: Thank you. Our next question today is coming from Toni Kaplan from Morgan Stanley. Your line is now live.

Speaker #4: Thank you. Our next question today is coming from Tony Caplan from Morgan Stanley. Your line is now live.

Toni Kaplan: Thanks so much. On slide 7, you noted that the TWN Indicator is driving share gains in mortgage. I was hoping you could just give some additional color on that, how much of the market in pre-qual you think you have or however you want to quantify share in that TriMerge area. Thanks.

Speaker #6: Thanks so much. On slide 7, you noted that the twin indicators driving share gains in mortgage— I was hoping you could just give some additional color on that.

Speaker #6: You know, how much of the market in prequal you think you have, or however you want to quantify, you know, share in sort of that tri-merge.

Speaker #5: area? Thanks. Yeah, it's a great question, Tony, and it's one that we view as a real asset for Equifax. As you know, we rolled it out a little less than a year ago.

Mark Begor: Yeah. It's a great question, Toni, and it's one that we view as a real asset for Equifax. As you know, we rolled it out a little less than a year ago. It's still, I would characterize it as early days in that deployment, but the response from customers is super positive. As you know, the MBA meeting was last week. Our team was there in full force, and that's just one of the items that we had a lot of discussions about, as well as some of our other new products that we're rolling out for the mortgage space like Income Qualify from the EWS business and the new score solution that we have from USIS. On TWN Indicator, it provides very unique visibility for our customers.

Speaker #5: It's still, I would characterize it as early days in that deployment, but the response from customers is super positive. As you know, the MBA meeting was last week.

Speaker #5: Our team was there, you know, in full force. And, you know, this is one of the items that, you know, we had a lot of discussions about, as well as some of our other new products that we're rolling out for the mortgage space.

Speaker #5: You know, like Mortgage Qualify, you know, from the EWS business and the new score solution that we have, you know, from USIS. You know, on Twin Indicator, you know, it provides very unique visibility for our customers.

Mark Begor: There's a deployment implementation timeframe that really lags some of the revenue benefit that we get that is just a reality of process change in our industry. But the momentum that we have with our customers is positive. We haven't quantified the actual share gains, but we know they're positive. I think you can see it in our revenue numbers for USIS in mortgage as well as how we characterize the performance versus the market as being positive. Then I'd just add a couple of reminders. Number one, we're also rolling out the NC Plus attributes, the cell phone utility attributes. So 54 attributes we're adding to our mortgage credit file also for free to differentiate it in the pre-qual and pre-application process, and we're getting great feedback from customers there.

Speaker #5: And, you know, there's a deployment implementation timeframe that you know, really lags some of the revenue benefit that we get. That is just a reality of process change, you know, in our industry.

Speaker #5: But the momentum that we have with our customers is positive. We haven't quantified, you know, the actual share gains, but we know they're positive.

Speaker #5: You know, I think you can see it in our revenue numbers for USIS in mortgage, as well as how we characterize the performance versus the market as being positive.

Speaker #5: And then I'd just add a couple reminders. Number one, we're also rolling out the NC+ attributes. The cell phone utility attributes. So 54 attributes we're adding to our mortgage credit file also for free to differentiate it in the prequal and pre-application process.

Speaker #5: And we're getting great feedback from customers there. That's another example that, that takes time for our customers to really adopt to the ability to ingest those additional attributes and that underwriting they're doing in the prequal marketing phase is also in the underwriting stage.

Mark Begor: That's another example that takes time for our customers to really adopt to the ability to ingest those additional attributes and that underwriting they're doing in the pre-qual marketing phase is also in the underwriting stage. But we all know that more data is valuable in an underwriting process. Our customers are focused on how do they optimize their marketing funnel, particularly in a super challenging market that we're in. So our ability to offer those unique solutions that are accretive to the core credit file at no cost, we think is an advantage. Second reminder is that we're doing the same thing in the TWN Indicator in Auto Card and P-Loan.

Speaker #5: But you know, we all know that more data, you know, is valuable in an underwriting process. And, you know, our customers are focused on how do they optimize their marketing funnel, particularly in a super challenging you know, market that we're in.

Speaker #5: So, our ability to offer those unique solutions that are accretive to the core credit file at no cost, we think, is an advantage.

Speaker #5: So second reminder is that you know, we're doing the same thing in the twin indicator in auto card and P-loan. You know, so that's going to benefit our diversified markets business in USIS as we really do the same thing, you know, work in the auto card and consumer finance or personal loan space to really optimize their, you know, marketing funnel and originations by providing that incremental data on, you know, someone's employment status, you know, their income last year, their employer, etc.

Mark Begor: So that's going to benefit our diversified markets business in USIS as we really do the same thing, work with the auto card and consumer finance or personal loan space to really optimize their marketing funnel and originations by providing that incremental data on someone's employment status, their income last year, their employer, et cetera, which really aids them in positioning the right product. Also optimizing who they focus on as they're trying to bring people through the marketing funnel to make sure that they can get someone to a closed loan, which is where they make the money.

Speaker #5: You know, which really aids them in positioning the right product and also optimizing, you know, who they focus on as they're trying to bring people through the marketing funnel to make sure that they can you know, get someone, you know, to a closed loan, which is where they make the money.

Toni Kaplan: Great. Then in government, really nice momentum in the new wins and renewals. You've been calling that out the last two quarters. I guess now that we've passed the 30 September fiscal year-end, how does that impact the sales process in government? Do you tend to get more new sales at the end of their fiscal year or the beginning of the next year when new budget cycles start? Just wanted to understand the dynamic on the sales cycle in government. Thanks.

Speaker #7: Great. And then in government, really nice momentum in the new wins and renewals. You've been calling that out the last 2 quarters. I guess now that we've passed

Speaker #8: the 9/30 fiscal year end, you know, how does that impact the sales process in government? Do you tend to get more new sales at the, end of their fiscal year or the beginning of the next year when new budget cycles start?

Speaker #8: Like, just wanted to understand the dynamic on the sales cycle in government.

Mark Begor: Yeah, it's a great question. Not every state's on that 30 September, so others are on different time frames. But you really have to separate what I would call revenue showing up in our P&L, meaning the sales become online and active and become revenue versus the sales cycle. The sales cycle can be very long in government, as it is in all of our businesses, but in government in particular. When we talk about signing a contract, which we did this quarter, we talked about it in July again from our strong Q2 on contract signings. We're clear about some visibility to you, but we know exactly with some real confidence of when that's going to turn into revenue. So there's a differentiation there. So when it comes to contract signings, they happen through the year.

Speaker #5: Thanks. Yeah, it's a great question. Not every state's on that 9/30, so others are on different timeframes, but you know, you really have to separate what I would call revenue, you know, showing up in our P&L, meaning the the sales become, you know, online and active and become revenue versus the sales cycle.

Speaker #5: The sales cycle is, you know, can be very long in government. As it is in all of our businesses, but in government in particular.

Speaker #5: And, you know, when we talk about, you know, signing a contract, you know, which we did, you know, this quarter, we talked about it in July again from our strong 2nd quarter.

Speaker #5: On contract signings, you know, we're clear about, you know, some visibility to you, but we know, you know, kind of exactly, you know, with some real confidence of when that's going to turn into revenue.

Speaker #5: You know, so there's a differentiation there. So when it comes to contract signings, they happen through the year. They can be lumpy, as we've said, and, you know, 2nd quarter was particularly strong because of one large one and a couple of other meaningful ones, but it doesn't change the commercial cycle that we have.

Mark Begor: They can be lumpy, as we've said, and Q2 was particularly strong because of one large one and a couple of other meaningful ones. But it doesn't change the commercial cycle that we have. As we've talked about on this call, we talked about it back in July and in February, the commercial momentum is extremely strong across both the federal, state, and local level. There's a lot of interest, some of it OBBB related, which puts more requirements on the states. But also more broadly, the unique solutions that we deliver. Because remember, we deliver speed of social service delivery, we deliver the productivity of the caseworker, and we also deliver that integrity. So there's a very strong value prop. So I would think about it, you should think about, and it's how we operate, that that commercial activity is happening every day.

Speaker #5: And as we've talked about on this call, we talked about it back in July and in February, the commercial momentum is extremely strong. You know, across both the federal, state, and local level.

Speaker #5: There's a lot of interest, some of it OB3-related, which puts, you know, more requirements on the states, but also, more broadly, the unique solutions that we deliver.

Speaker #5: Because remember, we deliver speed of social service delivery, we deliver the productivity of the caseworker, and we also deliver that integrity. So, you know, there's a very strong value prop.

Speaker #5: So I would think about, you know, you should think about, and it's how we operate. That commercial activity is happening every day. And I think I highlighted in my comments that, you know, for example, we have— and I think we talked about it in July also— we have several, actually more than several large federal, you know, commercial discussions going on that are quite meaningful, you know, and those, you know, take time, you know, before they crystallize into a contract signing.

Mark Begor: I think I highlighted in my comments that, for example, we have, and I think we talked about it in July also, we have several, actually more than several large federal commercial discussions going on that are quite meaningful. Those take time before they crystallize into a contract signing, and then there is an element of implementation when they become revenue. What is encouraging to us is the pipeline is robust, the conversations are robust, and our team is out there. Then I highlighted in my comments also that we are rolling out new solutions. So we are bringing more solutions to our customers in the federal, state, and local government to really help them better manage the delivery of social services and also the integrity around that social service delivery.

Speaker #5: And then there's an element of implementation when they become revenue, but you know, what's encouraging to us is the pipeline is robust, the conversations are robust, and, you know, our team is out there.

Speaker #5: And then, you know, I highlighted in my comments also that we're rolling out new solutions. You know, so we're bringing, you know, more solutions to our customers, you know, in the federal, state, and local government to really help them, you know, better manage, you know, the delivery of social services and also the integrity around that social service delivery.

Mark Begor: We are very energized around the progress by the team and the momentum as we finish Q3, we move into Q4, and then obviously we have got a lot of momentum about the setup we have for 2027.

Speaker #5: So we're very energized, you know, around the progress by the team and the momentum as we, you know, we finish the 3rd quarter, we move into 4th, and then obviously You know, we've got a lot of momentum about the setup we have for 2027.

Operator 1: Thank you. Our next question today is coming from Andrew Steinerman from J.P. Morgan. Your line is now live.

Operator: Thank you. Our next question today is coming from Andrew Steinerman from J.P. Morgan. Your line is now live.

Speaker #4: Thank you. Our next question today is coming from Andrew Steinerman from JPMorgan. Your line is now live.

Andrew Steinerman: Hi. I have a similar question about the setup for Verify, particularly government for 2027. I assume the strongest thing that you guys feel like you have locked in for Verify is the record growth that is already underway and exiting for 2027. Could you just remind us the puts and takes, what should we be thinking about of what is going to be the driver of Verify? I assume it is going to be government contracts.

Speaker #9: Hi, I have a similar question about the setup for VeriFIRE, particularly government for '27. I assume the kind of the strongest thing that you guys feel like you have locked in for VeriFIRE is the record growth that's already kind of underway and kind of exiting for '27.

Speaker #9: Could you just remind us the puts and takes? You know, what should we be thinking about? of what's going to be the driver of, you know, of VeriFIRE.

Speaker #9: I assume it's going to be government contracts.

Mark Begor: Yeah. It is multifaceted. As you know, Andrew, records is certainly a positive. We had a very strong records quarter, and I think we highlighted in our comments that we have a strong pipeline for continued record additions. That has been a strength of Chad and the EWS team for multiple years, and it continues. Again, a reminder, which sometimes our investors forget, while we have growing records up kind of low double digits over the last number of years, there is still a super long runway. We finished the quarter with 110 million current people or SSNs in our data set. Obviously, we have more records than that because people have multiple jobs. The 110 million compares to the 250 million income-producing Americans. We have a runway to more than double the data set going forward, and obviously that is going to take time. Records is a big deal.

Speaker #5: Yeah, it's multifaceted. You know, as you know, Andrew, you know, records is certainly a positive. We had a very strong records quarter, and I think we highlighted in our comments that we have you know, a strong pipeline for continued record additions.

Speaker #5: That's been a strength of Chad and the EWS team for, you know, multiple years, and it continues. And again, a reminder which sometimes our investors forget, you know, while we have, you know, growing records, you know, up kind of low double digits, you know, over the last number of years, there's still a super long runway.

Speaker #5: We finished the quarter you know, with 110 million current people or SSNs in our dataset. Obviously, we have more records than that because people have multiple jobs, you know, but the 110 million compares to 250 million income-producing Americans.

Speaker #5: So, you know, we have a runway to more than double the dataset going forward, and obviously that's going to take time. So records is a big deal.

Mark Begor: As you know, when you think about 2027, we typically do price increases on 1 January, so those will flow into EWS and the Verifier businesses in 2027. We have visibility from an Equifax perspective about what that is. You have also got new product rollouts and new customer penetration. Penetration is a big deal because of the $15 billion TAM they participate in. So the ability to add new customers. We have got visibility, and I think you pointed out, and we highlighted in July the large new state contracts that we have shared with you that are going to be substantially benefiting 2027. There is some Q4 impact, but the vast majority of that is in 2027. You see that, and obviously we do too, which is a positive.

Speaker #5: As you know, when you think about 2027, we typically do price increases on 1/1, so those will flow into, you know, EWS and the Verifier, you know, businesses in 2027.

Speaker #5: And, you know, we have visibility from an Equifax perspective about what that is. You know, you've also got, you know, new product rollouts and, you know, new customer penetration.

Speaker #5: You know, penetration is a big deal because of the $15 billion TAM they participate in. You know, so the ability to add new customers.

Speaker #5: So we've got visibility, and I think you pointed out, and we highlighted in July, you know, the large new state contracts that you know, we've, you know, shared with you that are going to be substantially benefiting 2027.

Speaker #5: There's some 4th quarter impact, but the vast majority of that is in 2027. You know, so you see that and obviously we do too, which is, you know, a positive.

Mark Begor: I would add just the commercial momentum. I think you have seen our talent business, very strong performance in a tougher market for white-collar hiring. But strong double-digit, 20% kind of growth. That is from new products. That is from penetration into that big $5 billion TAM. We are pleased with that. Our consumer finance or auto card personal loan business performing very well. As we look forward to 2027, we expect that kind of performance to continue. We have got a lot of confidence in that business getting back to inside of their LTFF framework as we get into 2027.

Speaker #5: And then I would add just the commercial momentum. You know, I think you've seen our talent business, you know, very strong performance in a tougher market.

Speaker #5: for white-collar hiring, you know, but strong double-digit, you know, 20% kind of growth, you know, that's from new products, that's from penetration into that into that, you know, big $5 billion TAM.

Speaker #5: So, you know, we're pleased with that. Our consumer finance or auto card personal loan business performing very well. You know, as we look forward to '27, you know, we expect that, you know, kind of performance to continue.

Speaker #5: So, you know, we've got a lot of confidence in that business, getting back to their, you know, inside of their LTFF framework as we get into 2027.

Andrew Steinerman: Thanks, Mark. Appreciate it.

Speaker #5: Thanks, Mark. Appreciate it.

Operator 1: Thank you. Next question is coming from Shlomo Rosenbaum from Stifel. Your line is now live.

Operator: Thank you. Next question is coming from Shlomo Rosenbaum from Stifel. Your line is now live.

Speaker #4: Thank you. Next question is coming from Shlomo Rosenbaum from Stifel. Your line is now live.

Shlomo Rosenbaum: Hi. Thank you very much for taking my questions. Mark, I want to ask a little bit about this discussion about TriMerge to bi-merge. Can you just talk a little bit, and just describe to us what the sentiment is amongst your largest lenders in terms of moving there? Because obviously there's a potential to save costs if you're using bi-merge instead of TriMerge. What are their other considerations, and how do they think about it when you talk to them about it? The large lenders, the ones that make the most difference.

Speaker #6: Hi, thank you very much for taking my questions. Mark, I want to ask a little bit about this discussion about tri-merge to bi-merge. And can you just talk a little bit when you just describe to us what the sentiment is amongst your largest lenders in terms of moving there, because obviously there's a potential to save costs if you're only— if you're using bi-merge instead of tri-merge.

Speaker #6: But what are their other considerations and how do they think about it when you talk to them about it? The large lenders, the ones that make the most difference.

Mark Begor: Yeah. I would say broadly, and you could add lenders, you could add many regulators, you could add legislatures. Think about Congress. You could think about Treasury who has a role in the fact that the federal government owns the liability on a lot of loans if they don't deliver. There's kind of broad consensus that TriMerge delivers a lot of value around access to credit, having the right price for the applicant or the homeowner or future homeowner or consumer, and then also safety and soundness. When you think about from a mortgage originator standpoint, what are they focused on? They're focused on managing their marketing funnel. They spend a lot of money, and typically they're doing digital originations.

Speaker #6: Yeah, I would say broadly, and you could add lenders, you could add

Speaker #5: There are many regulators; you could add legislatures—think about Congress and Treasury—who have a role, especially given that the federal government owns the liability on a lot of loans if they don't deliver.

Speaker #5: You know, there's kind of broad consensus that tri-merge delivers a lot of value around access to credit, having the right price, you know, for the applicant or the homeowner or future homeowner or consumer.

Speaker #5: And then also safety and soundness, you know. So when you think about from a mortgage originator standpoint, you know, what are they focused on?

Speaker #5: They're focused on, you know, managing their marketing funnel. You know, they spend a lot of money, and typically they're doing digital originations. And so they want to make sure that, you know, when they have someone who's coming to their website typically, in order to, you know, apply for a refi or apply for a new home loan mortgage, you know, that they can approve that consumer and that applicant.

Mark Begor: They want to make sure that when they have someone who's coming to their website, typically, in order to apply for a refi or apply for a new home loan mortgage, that they can approve that consumer and that applicant. A big part of that is having the complete information. I think we all know that there's enough significant differences between the three bureaus on the credit file that pulling three delivers a more accurate, a more complete, and also includes more people and gives them a better pricing. There's 11 million U.S. consumers that are only on one credit bureau. If you're going to pull two or one, that consumer may not get approved. I think we know that there's 40 to 50 million U.S.

Speaker #5: And a big part of that is having the complete information. And I think we all know that there are enough significant differences between the three bureaus on the credit file.

Speaker #5: That pulling 3, you know, delivers a more accurate, a more complete, and also includes more people and gives them, you know, a better pricing.

Speaker #5: There are 11 million U.S. consumers that are only on one credit bureau. You know, if you're going to pull two or one, that consumer may not get approved.

Speaker #5: And I think we know that there's, you know, 40 to 50 million US consumers, most of us on the phone, that have a, you know, 20 to 40 point difference between the 3 credit bureaus because not every financial institution contributes data to all 3 bureaus.

Mark Begor: consumers, most of us on the phone, that have a 20 to 40 point difference between the three credit bureaus because not every financial institution contributes data to all three bureaus. That is a meaningful difference. If you are pulling two, you do not pull that higher score for that consumer. They end up paying a higher price, or maybe they do not get approved. So it is a big element of the approval process. The flip side is if you are the government or if you are a balance sheet lender, which is still a meaningful part of the mortgage market, you want to make sure you get all of those trade lines from a safety and soundness standpoint. If you are only pulling one or two files and you do not pull that third that has maybe some of those more negative trade lines, you have got a riskier loan.

Speaker #5: That's a meaningful difference. If you're pulling 2, you don't pull that higher score for that consumer. They end up paying a higher price, or maybe they don't get approved, you know.

Speaker #5: So it's a big element of the approval process. And then the flip side you know, is if you're the government or if you're a balance sheet lender, which is still a meaningful part, you know, of the mortgage market, you know, you want to make sure you get all of those trade lines from a safety and soundness standpoint.

Speaker #5: If you're only pulling one or two files, and you don't pull that third that has maybe some of those more negative trade lines, you've got a riskier loan.

Mark Begor: So we think there is kind of broad-based support for it. I think as you know, FHA and VA have come out very clearly back in April. They put out a press release supporting Vantage, and also in that press release supported TriMerge. So I think they clearly understand the value of TriMerge for the consumer of approving more, and then the value around making sure they get the best price, meaning the lowest price that meets their risk profile because you are getting all the data, and then the safety and soundness that comes from it. So we thought it was important because there has been a lot of confusion, I think, in our investor base about how large could an impact be if FHFA decided to go to bi-merge. That is why we decided to size it.

Speaker #5: You know, so we think there's kind of broad-based support for it. I think, as you know, FHA and VA have come out very clearly—you know, back in April, they put out a press release supporting Vantage, and also, in that press release, supported tri-merge.

Speaker #5: You know, so I think, you know, they clearly understand the value of tri-merge for the consumer of approving more, and then the value around making sure they get the best price, meaning the lowest price that meets their risk profile because you're getting all the data, and then the safety and soundness that comes from it.

Speaker #5: So, we thought it was important because there's been a lot of confusion, I think, in our investor base about, you know, how large an impact could be if HFA decided to go to bi-merge.

Speaker #5: You know, that's why we decided to size it. We view it as very manageable, and likely for those on the call today, it's a framework that is a lot less than perhaps you were thinking over the last month or two, as you know, that dialogue has been in the press and so on.

Mark Begor: We view it as very manageable and likely for those on the call today, a framework that is a lot less than perhaps you were thinking over the last month or two as that dialogue has been in the press and so on. That was our intention was to frame it. We think TriMerge is right for the consumer. We also think it is right for the mortgage industry, and also we think it is right for federally guaranteed mortgages.

Speaker #5: So that was our intention, to frame it. But, you know, look, we think tri-merge is right for the consumer. We also think it's right for the mortgage industry, and we think it's right for federally guaranteed mortgages.

Shlomo Rosenbaum: Okay, thanks. Just for my follow-up, John, maybe if you could help us out a little bit, just as everyone is trying to incorporate into their model the impact of higher mortgage rates on the numbers in 2027. Where do you expect mortgage to end up as a percentage of revenue for the company? Like in total company, USIS, EWS, do we have some kind of a range or at least a rough estimate that you could give us so that we can kind of sensitize our numbers starting from that when we think about 2027?

Speaker #10: Okay, thanks. And just for my follow-up, John, maybe you could help us out a little bit, just as everyone's trying to incorporate into their model the impact of you know, higher mortgage rates on the numbers in 2027.

Speaker #10: Where do you expect mortgage to end up as a percentage of revenue for the company, like in total company USIS or EWS? Do we have some kind of range, or at least a rough estimate, that you could give us so we can sensitize our numbers starting from that when we think about 2027?

Mark Begor: Yeah. Go ahead, John. Please.

Speaker #10: Yeah, go ahead, John, please. So we're not going to give 2027 guidance, and certainly not going to give specifics around revenue or percentage of revenue.

John Gamble: We are not going to give 2027 guidance and certainly not going to give specifics around revenue or percentage of revenue. But the reason why in the script we tried to give some perspective on originations and transaction levels is to allow you to try to do that math on your own. As we said, we expect that you are going to see mortgage originations activity decline high single-digit percentage year-on-year to the extent that current mortgage run rates stay the way they are as we go through all of 2027, with the bulk of that impact happening in the first 8 months. As you will remember, Q4 of 2025 was a strong mortgage period. Q1 of 2026 was a strong period as well. So you will see significant impacts. Obviously, you are seeing it in Q4. You would see it in Q1.

Speaker #10: But the reason why, in the script, we tried to give some perspective on originations and transaction levels is to allow you to try to do that math on your own.

Speaker #10: And as we said, we expect that you're going to see mortgage originations activity decline by a high single-digit percentage year-on-year. To the extent that current mortgage run rates stay the way they are as we go through all of 2027, with the bulk of that impact happening in the first eight months.

Speaker #10: So as you'll remember, 4th quarter of '25 was a strong mortgage period. 1st quarter of '26 was a strong period as well. So, so you'll see significant impacts.

Speaker #10: Obviously, you're seeing it in the fourth quarter. You'd see it in the first quarter. It starts to mitigate a little bit in the second, and then obviously substantially in the third, given what's happened this quarter and what you're seeing in the fourth quarter of this year.

John Gamble: It starts to mitigate a little bit in Q2, then obviously substantially in Q3, given what happened this quarter and what you are seeing in Q4 of this year.

Mark Begor: Again, just to be clear, what we always do and what we have done in this scenario modeling for Q4 and trying to give you some visibility for 2027 is we have taken current run rates. Obviously, they are depressed over the last 8 weeks and we can only assume that they are going to continue at that level until inflation comes under control and perhaps the Middle East conflict is resolved and then rates moderate some. I had in my comments the fact that even at this lower level, there is still mortgage activity happening. It is down meaningful. It is down over 50% from what we would call normal levels. But there is still mortgage activity happening every day, every week that is building that pipeline going forward. We are now up to 17 million mortgages over 6%.

Speaker #10: And again, just to be clear, you know what we.

Speaker #5: always do and what we've done in this scenario modeling for the 4th quarter and trying to give you some visibility for '27 is we've taken current run rates.

Speaker #5: You know, obviously they're you know, depressed over the last 8 weeks. And, you know, we can only assume that they're going to continue at that level until, you know, inflation comes under control and perhaps the Middle East conflict is resolved and, and then, you know, rates moderate some.

Speaker #5: You know, I had in my comments, you know, the fact that even at this, you know, lower level, there's still mortgage activity happening. You know, it's down meaningful.

Speaker #5: It's down over 50% from what we would call normal levels. But there's still mortgage activity happening every day, every week that, you know, is building that pipeline.

Speaker #5: Going forward, we're now up to 17 million mortgages over 6%. And I think, as you know, you know, it takes a quarter point, 50 basis point, you know, change in rates and you open up a refi opportunity, you know, for that population.

Mark Begor: And I think as you know, it takes a quarter point, 50 basis point change in rates, you open up a refi opportunity for that population. It is hard to see when that is going to happen with what is happening today. But it is going to happen. It is just a matter of when that timeframe is. As we move forward, that 17 million household number or mortgage number is only going to get larger.

Speaker #5: It's hard to see when that's going to happen, you know, with what's happening today, but it's going to happen. You know, it's just a matter of when that timeframe is.

Speaker #5: And you know, as we move forward, that $17 million, $17 million, you know, household number or mortgage number is only going to get larger.

Operator 1: Thank you. Our next question today is coming from Jason Haas from Wells Fargo. Your line is now live.

Operator: Thank you. Our next question today is coming from Jason Haas from Wells Fargo. Your line is now live.

Speaker #4: Thank you. Our next question today is coming from Jason Haas from Wells Fargo. Your line is now live.

Jason Haas: Hey, good morning, thanks for taking my question. Can I just confirm in a follow-up in response to a prior question, did you say that you would expect the EWS business to get back to the long-term framework next year? Did I hear that correctly? Was that for the overall EWS business?

Speaker #9: Hey, good morning, and thanks for taking my question. Can I just confirm in a follow-up, in a response to a prior question, did you say that you would expect the EWS business to get back to the long-term framework

Speaker #5: next year? Did I hear that correctly? Was that for the overall EWS business? Yeah, we didn't give 2027 guidance, and it's our intention to give 2027 guidance.

Mark Begor: Yeah. We didn't give 2027 guidance, that is our intention to give 2027 guidance. I think the question was around the performance of the business and its momentum as we finish the year, which we are super pleased with. The business is performing well, you have seen improvements on a quarter-over-quarter basis from Q2 to Q3 that we are pleased with. We have provided some information on 2027 that you can do your own math on some of the setup like the government contracts that we have signed that were substantially incremental in 2027 versus 2026 that give you some visibility.

Speaker #5: I think the question was around, you know, the performance of the business and its momentum as we finish the year, which we're super pleased with.

Speaker #5: And, you know, the business is performing well and you've seen, you know, kind of improvements on a quarter-over-quarter basis from 2nd to 3rd quarter that we're pleased with.

Speaker #5: And, you know, we've provided some information on '27 that, you know, you can do your own math on. You know, on some of the setup, like, you know, the government contracts that we've signed that, you know, were substantially incremental in '27 versus '26 that, you know, give you some visibility.

Jason Haas: Oh, okay, great. Thanks for clarifying that. Then, maybe just to follow up on government. So the $15 million of new government bookings in Q3 was very strong. Are you able to give us any expectations for, I do not know in there if there was any sort of big wins or not, or if that is the right framework to think about what we could see as well in Q4. Then for government, do you expect that revenue to continue to accelerate in Q4 than again in 2027? I think you had said that previously.

Speaker #11: Okay, great. Thanks for clarifying that. And then, yeah, maybe just to follow up on government. So the $50 million of new government bookings in Q3 was, you know, very strong.

Speaker #11: Are you able to give us any expectations for— I don't know in there if there was any sort of big wins or not, or if that's the right framework to think about what we could see as well in Q4.

Speaker #11: And then for government, do you expect that revenue to continue to accelerate in Q4, then again in 2027? I think you had said that previously.

John Gamble: So Q2 and Q3 were very strong quarters for the government team in terms of signings and renewals. Part of that is just based on the timing of when state budgets move, right. So Q4 tends to be much smaller in terms of that type of activity. As Mark said, we are doing a lot with the federal government and other opportunities. It does not mean the selling activity changes in any way. But in terms of likely signings, the strongest periods you tend to see are really Q2 and Q3. A little bit in Q1, but really Q2 and Q3 tend to be the strongest, just based on the way state budget cycles run.

Speaker #10: But 2Q and 3Q were very strong quarters for the government team in terms of signings and renewals, and part of that is just based on the timing of when state budgets move, right?

Speaker #10: So, the fourth quarter tends to be much smaller in terms of that type of activity. As Mark said, we're doing a lot with the federal government and other opportunities.

Speaker #10: It doesn't mean the selling activity changes in any way. But in terms of likely signings, you know, the strongest periods you tend to see are really Q2 and Q3—a little bit in Q1—but really, Q2 and Q3 tend to be the strongest.

Speaker #10: Just based on the way state budget cycles run.

Operator 1: Thank you. Next question today is coming from Faiza Alwy from Deutsche Bank. Your line is now live.

Operator: Thank you. Next question today is coming from Faiza Alwy from Deutsche Bank. Your line is now live.

Speaker #4: Thank you. Next question today is coming from Faiz Ali from Deutsche Bank. Your line is now live. Yes. Hi. Thank you. So just to follow up on that government question, how much of the $150 million of the new business are you expecting to realize

Faiza Alwy: Yes, hi. Thank you. So just to follow up on that government question, how much of the $150 million of the new business are you expecting to realize in revenues this year?

Speaker #8: in revenues this year?

Mark Begor: Yeah. I think we said a couple of times that the new contract signings are principally 2027 kind of impact, with some of that benefit in Q4. Some of it was in Q3, quite small. Substantially, all of that is in 2027.

Speaker #5: Yeah, I think we've said, you know, a couple times that, you know, the new contract signings are principally '27, you know, kind of impact with some of that benefit in the in the 4th quarter.

Speaker #5: You know, some of it was in the 3rd quarter, quite small, but, you know, substantially all of that is in 2027.

John Gamble: Yeah, we saw some of the contracts that we talked about in Q2 start to monetize in Q3, and many of them are monetizing in Q4.

Speaker #10: That we did—we saw some of the contracts that we talked about in the second quarter start to monetize in the third quarter, and many of them are monetizing in the fourth.

Faiza Alwy: Okay, got it. Okay. I wanted to ask about Vantage adoption, and you talked about moving to a paid model. I just want to understand the strategy there. Are you going to continue to offer Vantage for free when someone is buying the FICO score from you? Is that strategy changing? I think you talked about $35 million annualized margin upside. I am just curious, what does that represent at this point?

Speaker #6: Okay, got it. Okay. And then I wanted to ask about, you know, Vantage adoption, and you talked about moving to a paid model.

Speaker #8: So, just want to understand the strategy there. Are you going to continue to offer Vantage for free when someone is buying the FICO score from you, or is that strategy changing?

Speaker #8: And then I think you talked about $35 million annualized margin upside. Just curious, what is that?

Speaker #5: Represent at this point? Yeah, so your last question, and we've been clear about that, is we wanted to calculate for you if there was full Vantage conversion of all the FICO scores.

Mark Begor: Yeah. Your last question, and we have been clear about that, is we wanted to calculate for you if there was full Vantage conversion of all the FICO scores. Obviously, we do not make any money today when we sell a FICO score. That is zero margin, which is to pass through to FICO. If we sell the Vantage score, we make a dollar on each score. So that at current kind of run rate levels, if we move everyone, our piece of that would be a margin upside in the $30 million to $40 million range. Obviously, that is going to take time, but we see some real momentum there.

Speaker #5: Obviously, we don't make any money today when we sell a FICO score. That's zero margin, which is a pass-through to FICO. And if we sell the VantageScore, we make $1 on each score.

Speaker #5: So that, at current kind of run-rate levels, if we move everyone, our piece of that would be a margin upside in the $30 to $40 million range.

Speaker #5: You know, obviously that's going to take time, but we see some real momentum there. We did announce at MBA last week, and I shared on that call this morning, that we're planning to keep our $1 VantageScore score at $1 through 2028 to give our customers, you know, more confidence and visibility, you know, around, you know, Vantage pricing versus FICO pricing.

Mark Begor: We did announce at MBA last week, and I shared on that call this morning that we are planning to keep our $1 VantageScore at $1 through 2028 to give our customers more confidence and visibility around Vantage pricing versus FICO pricing as they make that decision to use the VantageScore. Yes, we are still offering the free VantageScore with every paid FICO score in order to drive adoption. Remember, for the customers, you are not getting any savings because you are still paying the $10 plus for the FICO score versus the dollar that is available if you move to Vantage. That is why we said on the call, I think we have 200 customers, smaller, that have moved to the dollar VantageScore exclusively because they are getting better score performance and in the marketing side of the origination in pre-qual, and they are getting the big cost savings.

Speaker #5: You know, as they make that decision to, you know, use the VantageScore. And yes, we are still offering the free VantageScore with every paid FICO Score in order to drive adoption.

Speaker #5: But you remember, you know, for the customers, you're not getting any savings because you're still paying, you know, the $10-plus for the FICO score, versus the $1 that's available if you move to Vantage.

Speaker #5: And that's why, you know, we said on the call—I think we have 200 customers, smaller, you know, that have moved to the VantageScore dollar exclusively, because they're getting better score performance in the marketing side of originations.

Speaker #5: in prequal, and they're getting the big cost savings. And, you know, you've seen press releases from, you know, some of the larger mortgage lenders, and, you know, we're talking to them also.

Mark Begor: You have seen press releases from some of the larger mortgage lenders, and we are talking to them also. They are well aware of the huge cost savings that they have because as you know, 6 out of 10, 7 out of 10, 8 out of 10 mortgages do not close, and that is a COGS for them. So the ability to do that pre-qual or pre-application with a VantageScore for a dollar is a huge savings. On the neighborhood between a credit file and the VantageScore versus a credit file versus a FICO score, it is like a 45% savings for the originator, and that is just a lot of savings. It also passes through the consumer, because the consumer pays for the TriMerge at closing and at a $1 score, there is a meaningful savings for the consumer also.

Speaker #5: You know, they're well aware of the huge cost savings that they have because, as you know, 6 out of 10, 7 out of 10, or 8 out of 10 mortgages don't close. And that's a COGS for them.

Speaker #5: So the ability to, you know, do that prequal or pre-application with a VantageScore for a dollar is a huge savings. It's, you know, in the neighborhood between a credit file and the VantageScore versus a credit file versus the FICO score, it's like a 45% savings.

Speaker #5: You know, for the originator, that's just a lot of savings that also passes through to the consumer, you know, because the consumer pays for the tri-merge at closing, and at a $1 score, you know, there's meaningful savings for the consumer also.

Mark Begor: There is a lot of momentum around that conversion, and we expect that to pick up in Q4 and then move forward in 2027, when we expect FHA and VA to move to adopting Vantage inside of their processes, we understand around 1 January.

Speaker #5: So, there's a lot of momentum, you know, around that conversion, and we expect that to pick up in the fourth quarter and then move forward in 2027, you know, when we expect FHA and VA to move to adopting Vantage, you know, inside of their processes. We, you know, we understand around January 1st.

Operator 1: Thank you. Next question today is coming from Barclays.

Operator: Thank you. Next question today is coming from Barclays.

Speaker #4: Thank you. Next question today is coming from Anil Tadhayak from Barclays United Airlines.

Wahid Amin: Hi, this is Wahid Amin from Manov. Just wanted to talk about the event that FHFA decides to go from TriMerge. I know you've talked about bi-merge, but ultimately, if it goes to a single file, would the economics hold true in your view that lenders will still want to pull all three, and would it still be manageable? Outside of that, I understand the TWN Indicator and the NC Plus, but is there any other way

Speaker #9: Hi, this is Wahid Aminan from Manav. Just wanted to talk about the event that FHFA decides to go from tri-merge. I know you've talked about my-merge, but ultimately, if it goes to a single file, would the economics hold true in your view that lenders will still want to pull all 3?

Speaker #4: And would it still be manageable?

Speaker #9: And outside of that, I understand the TWIN indicator and the NC+, but is there any other way you can differentiate the credit file outside of that?

Mark Begor: Yep

Wahid Amin: you can differentiate the credit file outside of that?

Mark Begor: First, to be clear, to our knowledge, and maybe you have different knowledge, but everything we know is the FHFA has not made a decision to go to bi-merge. Obviously, they've talked about it. There was a press article, I believe, in Bloomberg that said they were expecting an announcement from FHFA, and that, to our knowledge, hasn't happened yet. That's why we decided to put some framework in our discussion this morning about what a potential impact would be to Equifax, and we view it as manageable. We've already talked on the call this morning about why we think TriMerge is important. To your question, our expectation is it wouldn't be a requirement to go to bi or single merge.

Speaker #5: First, to be clear, you know, our knowledge—and maybe you have different knowledge—but everything we know is the FHFA has not made a decision to go to buy-merge.

Speaker #5: Obviously, they've talked about it. There was a press article—I believe in Bloomberg—that said they were expecting an announcement from FHFA, and that, to our knowledge, hasn't happened yet.

Speaker #5: But that's why we decided to, you know, put some, you know, framework in our discussion this morning about what a potential impact would be to Equifax, and we view it as manageable.

Speaker #5: We've already talked on the call this morning about why we think tri-merge is important. And, you know, to your question, you know, our expectation is it wouldn't be a requirement to go to buy or single merge.

Mark Begor: It would be an option for the lender, and the lender would make the decision about what they want to do in their marketing process and underwriting process to make sure that they're managing their marketing funnel, they're approving more consumers, they're providing the right price to the consumer around what price the interest rate is on the loan. As you point out, we have a lot of advantages at Equifax in a bi-merge world for FHFA loans because of unique solutions we deliver, the TWN attributes, the TWN data that we have in the credit file, the NC Plus attributes that we're offering at no charge. Also the fact that we own a TriMerge business, where we go to market. We would obviously take advantage of that in how we deliver our credit file in the marketplace.

Speaker #5: It would be an option, you know, for the lender. And the lender would make the decision about what they want to do in their marketing process and underwriting process to make sure that they're managing their marketing funnel and approving more consumers.

Speaker #5: They're providing the right price. You know, to the consumer, you know, around, you know, what price, you know, the interest rate is, you know, on the loan.

Speaker #5: And then, as you point out, you know, we have a lot of advantages at Equifax, you know, in a buy-merge, you know, world for FHFA loans, you know, because of unique solutions we deliver, you know, with twin— the twin attributes, the twin data that we have in the credit file, the NC+ attributes that we're offering at no charge, also the fact that we own a tri-merge business, you know, where we go to market.

Speaker #5: So, you know, we would obviously take advantage of that and how we deliver our credit file, you know, in the marketplace. So You know, I think it's one that our intention this morning was really just to size the impact, and then we'll be ready to respond, you know, if in fact the FHFA goes down the path.

Mark Begor: So, I think it's one that our intention this morning was really just to size the impact. Then we will be ready to respond if in fact the FHFA goes down the path. But as you point out, our expectation is the lender would make that decision about what they want to do as far as credit files that they are pulling.

Speaker #5: But as you point out, You know, our expectation is the lender, you know, would make that decision about, you know, what they want to do as far as credit files that they're pulling.

Wahid Amin: Thank you. Then on government, I know you mentioned some of the contract wins have been towards subscription-based. As you are having more conversations with these state counterparts, are they leaning more towards subscription-based contracts? If not, is that something you think the government is headed towards?

Speaker #9: Thank you. And then on government, I know you mentioned some of the contract wins have been towards subscription-based. As you're having more conversations with these state counterparts, Are they leaning more towards subscription-based contracts?

Speaker #9: And if not, is that something you think the government is headed towards?

Mark Begor: Yeah. It's one that we started deploying commercially a couple of years ago. It's clearly something that many of our customers like the idea, the certainty of a subscription. As you know, all budgets are complex, whether you are in the government side or if you are in the commercial side. In the case of government, they are more complex because they generally have to get at the state or local level funding for expenditures for projects from their legislature. So, having the ability to have some more certainty around during that fiscal year, what the spend is going to be on our solution is positive. So we have seen a growing trend there, but we still offer both, and we want to be flexible with our customers around helping them utilize our solution. We want to drive penetration into that big TAM. As a reminder, it's a $5 billion TAM.

Speaker #5: Yeah, it's one that we started deploying commercially a couple of years ago. It's clearly something that many of our customers like—the idea of the certainty of a subscription.

Speaker #5: And as you know, All budgets are complex, whether you're in the government side or if you're in the commercial side. In the case of government, they're more complex because they generally have to get at the state or local level.

Speaker #5: funding for expenditures for projects from their legislature. So having the ability to have some more certainty around during that fiscal year what the spend is going to be on our solution is positive.

Speaker #5: So we've seen a growing trend there, but we still offer both and we want to be flexible with our customers. You know, around helping them, you know, utilize our solution.

Speaker #5: We want to drive, you know, penetration into that big TAM. You know, as a reminder, it's a $5 billion TAM. You know, we've got less than, you know, 20% of it.

Mark Begor: We have got less than 20% of it. So there are a lot of manual verifications that are still being done that are opportunities for us. So we want to be responsive and flexible commercially to help our customers adopt our solution.

Speaker #5: You know, so there's, you know, a lot of manual verifications that are still being done that, you know, are opportunities for us. So we want to, you know, be responsive and flexible commercially.

Speaker #5: You know, to help our customers adopt our solution.

Operator 1: Thank you. Next question today is coming from Andrew Nicholas from William Blair. Your line is now live.

Operator: Thank you. Next question today is coming from Andrew Nicholas from William Blair. Your line is now live.

Speaker #4: Thank you. Next question today is coming from Andrew Nicholas from William Blair. Your line is now live.

Andrew Nicholas: Hi, thank you, and good morning. I want to dig a little bit further into talent momentum. I think you mentioned mid-single-digit growth for underlying growth, but outperformance relative to that market is holding very strong, if not accelerating. I was hoping you could spend a bit more time on what is driving increased penetration, how much of that outperformance is new products, and any other color on the market makeup there in your evolution as a key provider to the space.

Speaker #7: Hi, thank you, and good morning. I wanted to dig in a little bit further into talent momentum. I think you mentioned mid-single-digit growth for underlying growth.

Speaker #7: But outperformance relative to that market is holding very strong, if not accelerating. So I was hoping you could spend a bit more time on kind of what is driving increased penetration, what— how much of that outperformance is new products and any other color on kind of the market makeup there and your evolution as a key provider to the space?

Mark Begor: Yeah. We are pleased with the performance. They had strong performance last year. Also, it is a big TAM. It is one where we deliver a lot of value in our core solution about verifying past employment. I think, as you know, the Appriss incarceration data acquisition that we did several years ago has been a very positive one for us. That is used very broadly in background screens, doing that incarceration check, and we have rolled out new products there and are driving penetration. The TAM is quite large here also. That is a multi-billion dollar, $5 billion TAM. And again, here we have, again, less than 15% of the market is using our solution from a penetration standpoint. So our team at EWS has a lot of penetration opportunities. And then, as you point out, we have been rolling out new products in the education space.

Speaker #5: Yeah, it's, you know, we're pleased with the performance. You know, they had strong performance last year. You know, also it's a big TAM. It's one where we deliver a lot of value in kind of our core solution about verifying past employment.

Speaker #5: I think as you know, the Appriss incarceration data acquisition that we did several years ago has been a very positive one for us that's used very broadly in background screens doing that incarceration check.

Speaker #5: And we've rolled out new products there and are driving penetration. You know, the TAM is quite large here also. You know, that's a multi-billion dollar—$5 billion TAM.

Speaker #5: You know, and again, here we have, again, less than 15% of the market using our solution from a penetration standpoint. So, you know, our team at EWS has a lot of penetration opportunities.

Speaker #5: And then, as you point out, we've been rolling out new products in the education space. In the employee verification space, we now have an hourly solution where there's less data required to verify past employment and education.

Mark Begor: In the employee verification space, we now have an hourly solution where there is less data required to verify past employment. Education solutions that we are rolling out. Every year we take price up. We will do that again on 1 January in the talent vertical. So when we look forward, we are still benefiting from the price we did early this year for 2026. So a lot of really strong performance. And then, of course, record growth. When we grow records, we have higher hit rates. We can deliver more complete information on that employment background. So multifaceted and strong execution in a big TAM by the Workforce Solutions team. We have also expanded into healthcare. We have launched more and broader healthcare solutions into the talent vertical as well, which we think is also going to help drive long-term growth.

Speaker #5: Solutions that we're rolling out—you know, every year we take price up. We'll do that again on January 1st in the Talent vertical. So when we look forward, we're still benefiting from the price increase we implemented early this year for 2026.

Speaker #5: You know, so a lot of really strong performance. And then of course, record growth. You know, when we grow records, we have higher hit rates.

Speaker #5: Now we can deliver, you know, more complete information on that, you know, employment background. So multifaceted and, you know, strong execution and a big TAM by the Workforce Solutions team.

Speaker #10: We've also expanded into healthcare. We've launched more and broader healthcare solutions into the talent vertical as well, which we think is also going to help drive long-term growth.

Andrew Nicholas: Great. Very helpful. For my follow-up, I wanted to ask on income and employment verification. I think last month a competitor of yours announced an integration with a large partner of yours. Wanted to see if you had any thoughts on what that means for your business, but maybe more broadly, if you could touch on your conviction in having exclusive relationships on that front or maybe, again, the resilience of your model to competition. Thank you.

Speaker #7: Great, very helpful. And for my follow-up, I wanted to ask about income and employment verification. I think last month, a competitor of yours announced an integration with a large partner of yours.

Speaker #7: I wanted to see if you had any thoughts on what that means for your business, but maybe more broadly, if you could touch on your conviction in having exclusive relationships on that front, or, again, the resilience of your model to competition.

Speaker #7: Thank you.

Mark Begor: Yeah. We view that more as a one-off that was really driven by some decisions that they wanted to make about how they go to market. We saw a very strong relationship with that customer. We expect that to continue going forward. When we look broadly, we are very pleased with our record growth. We deliver a lot of value to those partners that we work with in the payroll, HR software, pension, benefits administrator space. There is just a lot of continued momentum there. Our benefits are the scale of our distribution is very large. We have connections in the mortgage, auto, card, P-loan, background screening, government social service space that are really second to none.

Speaker #5: Yeah, we viewed that more as a one-off that was really driven by some decisions that they wanted to make about, you know, how they go to market.

Speaker #5: You know, we still have a very strong relationship, you know, with that customer. We expect that to continue going forward and You know, when we look broadly, we're very pleased with our record growth.

Speaker #5: You know, we deliver, you know, a lot of value to those partners that, you know, we, we work with in the payroll HR software.

Speaker #5: You know, pension benefits administrator space, you know, there's just a lot of, you know, continued momentum there. You know, our benefits are the scale of, you know, our distribution.

Speaker #5: You know, is very, very large. You know, we have connections, you know, in the mortgage, auto, card, P-loan, background screening, government social service space that, you know, are really second to none.

Mark Begor: So when it comes to our ability to grow our business and then share in a rev share with them, we just have very substantial advantage there, which is a positive in those partnerships that we have. We also invest heavily in our technology and in our product capabilities. So when you think about us rolling out new solutions in all of our verticals, those benefit those partnerships which are really valuable to us. So we have a lot of confidence in our ability to continue to grow our records. We have a lot of confidence in our ability to deliver value to our partners in those partner relationships. We do not expect that to change going forward.

Speaker #5: So you know, when it comes to, you know, our ability to, you know, grow our business and then share in a rev share with them, you know, we just have very substantial advantage there, which is a positive in those partnerships that we have.

Speaker #5: You know, we also invest heavily in our technology and in our product capabilities. So, you know, when you think about, you know, us rolling out new solutions, you know, in all of our verticals, those benefit those partnerships, you know, which are, you know, really valuable to us.

Speaker #5: So, you know, we have a lot of confidence in our ability to continue to grow our records. We have a lot of confidence in our ability to deliver value to our partners, you know, in those partner relationships.

Speaker #5: And, you know, we don't expect that to change going forward.

Operator 1: Thank you. Our next question today is coming from Ashish Sabadra from RBC Capital Markets. Your line is now live.

Operator: Thank you. Our next question today is coming from Ashish Sabadra from RBC Capital Markets. Your line is now live.

Speaker #4: Thank you. Our next question today is coming from Ashish Sabadra from RBC Capital Markets. Your line is now live.

Ashish Sabadra: Thanks for taking my question. I just had a question on the EWS margins. The guidance implies a step down for full Q, which I believe, John, you attributed to mortgage weakness. How should we think about the EWS margins going forward, even with some mortgage pressure there? Thanks.

Speaker #11: Thanks for taking my question. I just had a question on the EWS margins. The guidance implies a step down for Q4, which I believe, John, you attributed to mortgage weakness.

Speaker #11: So as we think about some of the puts and takes, obviously you talked a lot about the AI benefit, but how should we think about the EWS margins going forward, even with some mortgage pressure there?

Speaker #5: Thanks. Yeah, we're very pleased with the EWS margins. They're, you know, very, very high and attractive. And, you know, our intention is to continue to invest in the business.

Mark Begor: Yeah. We are very pleased with the EWS margins. They are very high and attractive, and our intention is to continue to invest in the business because of the high growth it delivers as well as the high margins that it generates. At the same time, make sure that we are deploying everything we have around productivity and AI productivity and operating leverage, not only at EWS but at our other businesses. We are seeing very positive benefits by the EWS team as they deploy AI productivity in their operation centers. They have very large operation centers in our employer business. We have the same kind of call centers, although not as large, both for consumers, for employees of our contributors, and also for our B2B customers that we are deploying AI in. Our technology operation in EWS, same thing.

Speaker #5: Because of the high growth it delivers, as well as the high margins that it generates. But at the same time, make sure that we're deploying everything we have around productivity and AI productivity, and operating leverage not only at EWS, but at our other businesses.

Speaker #5: You know, we're seeing very positive benefits from the EWS team as they deploy AI productivity in their operation centers. They have very large operation centers in our employer business.

Speaker #5: You know, we have the same kind of call centers, although not as large, both for, you know, consumers, for employees, you know, of our contributors, and also for our B2B customers that we're deploying AI in, you know, when we expand, and then our technology operation in EWS, same thing.

Mark Begor: Our goal is to continue to maintain those very attractive 50-plus percent EBITDA margins going forward by the strong operating leverage that comes from their top-line growth and also the deployment of AI productivity.

Speaker #5: So, you know, our goal is to continue to maintain those very attractive 50-plus percent EBITDA margins going forward, by the strong operating leverage that comes from their top-line growth and also the deployment of AI productivity.

Ashish Sabadra: That is very helpful color. Then maybe just on mortgage inquiries, I know this question was asked before, but as we think about that high single digit mostly on the first 8 months of 2027, are there certain nuances by quarter that we need to be cognizant of? Any particular color that you can provide there will be helpful. Thank you.

Speaker #11: That's very helpful color. And then maybe just on mortgage inquiries—and I know this question was asked before—but as we think about that high single digit, mostly in the first eight months of 2027, are there certain nuances by quarter that we need to be cognizant of?

Speaker #11: Any particular color that you can provide there would be helpful. Thank you.

John Gamble: Yeah. As Mark described it, what we do is we just apply normal seasonality to our expectations for the next year because we do not have any basis to think of anything else. However, you obviously know what happened in 2026. In 2026, the Q1 was a pretty good mortgage quarter, right? Until rates started increasing in March, right? Then Q2 weakened but was certainly better than what we saw in the Q3 and the Q4 of this year. On a year-over-year basis, it would indicate that the largest impact year over year is likely going to be in the H1. But again, that is just based on us using normal seasonality in 2027 because that is what we know today.

Speaker #10: Yeah, so the way, as Mark described it, what we do is we just apply normal seasonality to our expectations for the next year, because we don’t have any basis to think of anything else.

Speaker #10: However, you obviously know what happened in 2026. So, in 2026, the first quarter was a pretty good mortgage quarter, right? And until rates started increasing in March, right?

Speaker #10: And then Second quarter weakened, but was certainly better than what we saw in the third and the fourth quarter of this year. So, so on a year-over-year basis, it would indicate that, that the largest impact year over year is likely going to be in the first half.

Speaker #10: But again, that's just based on us using normal seasonality in 2027 because that's what we know today.

Operator 1: Thank you. Next question is coming from Curtis Nagle from Bank of America. Your line is now live.

Operator: Thank you. Next question is coming from Curtis Nagle from Bank of America. Your line is now live.

Speaker #4: Thank you. Next question is coming from Curtis Nagle from Bank of America. Your line is now live.

Curtis Nagle: Great. Thanks so much for taking the question. Apologies if I missed this, but just any color you could provide on the Verify or government mortgage expectations for Q4. Should we expect something similar to Q3 in terms of year-over-year growth? Does it accelerate? Given market year point some more new.

Speaker #10: Great. Thanks so much for taking the question. So yeah, apologies if I missed this, but just any color you can provide on the Verifyr government mortgage expectations for 4Q?

Speaker #4: Should we expect something similar to Q3 in terms of year-over-year growth? Does it accelerate, given, Mark, your point about some more new book of business coming in?

Curtis Nagle: Government

Curtis Nagle: For the business coming in. Yeah, just a little more color if you could in terms of what is contemplated in the guide.

Speaker #4: Yeah, just a little more color, if you could, in terms of what's—

Speaker #5: complicated in the guide.

John Gamble: Yeah. We do not give specific guidance going forward by segment or line of business. I think what we have said is that we are happy with the pace at which we have added new clients and new customers in government, that we have seen a fair number of the contracts we signed in Q2 start to monetize and others would start to monetize in Q4. We are very happy with that. Then more broadly, when we talked about what we are seeing in the economy, we indicated that we are seeing some weakening in talent and we are seeing some weakening just in industry run rates around auto and FI. More heavily around things that are more interest rate sensitive.

Speaker #10: Yeah, so we don't give specific guidance going forward by segment or line of business, right? So I think all we— what we have said is that we're happy with the pace at which we've added new clients and new customers in government, that we've seen a fair number of the contracts we signed in the 2nd quarter start to monetize, and others would start to monetize in the 4th quarter.

Speaker #10: So we're very happy with that. And then more broadly, when we talked about what we're seeing in the economy, we indicated that we are seeing some weakening in talent, and we are seeing some weakening just in industry run rates around auto and FI, right?

Speaker #10: And more heavily around things that are more interest rate sensitive. So, what we said is we're looking at those, but as you're thinking about Q4, those are some of the trends that we're considering as we look through the next quarter and into next year.

John Gamble: What we said is we are looking at those, but as you are thinking about Q4, those are some of the trends that we are thinking about as we look through the next quarter and into next year.

Curtis Nagle: Okay. Let me be able to shift it to somewhat of a two-part advantage. Just, I guess outside of the three large lenders that are currently originating, I think do mostly originating, what is your sense in terms of preparedness for the rest of the industry in terms of them turning on Vantage to originate? I guess how much do you think, I think Mark, you alluded to this, the move to the unified grid potentially shifts more volume to Vantage.

Speaker #4: Okay, then maybe I'll just shift it to somewhat of a 2-part advantage. Just, I guess, outside of the, you know, 3 large lenders that are currently originating, I think do most of the originating, You know, what's your sense in terms of preparedness for the rest of the industry in terms of, you know, them turning on advantage to originate?

Speaker #4: And I guess how much do you think I think Mark, you alluded to this, you know, the move to the unified grid, you know, potentially shifts more volume to Advantage.

Mark Begor: Yeah, I think the industry has been preparing for quite some time. I think as you know, it is a year ago July when the FHA first announced that they were going to adopt Vantage, and then in April they actually turned it on. In that time frame, a lot of the technical work, process work has been completed. In some cases, there is still testing happening, which is why last year we started offering the free VantageScore so they could adopt it and really process through their workflows both scores. I think substantially the industry is pretty well prepared.

Speaker #5: Yeah, I think the industry's been preparing for quite some time. I think, as you know, it's a year ago July when the FHFA first announced, you know, that they were going to adopt Vantage and You know, then in April, you know, they actually turned it on.

Speaker #5: And, you know, in that timeframe, a lot of the technical work and process work has been completed. You know, in some cases, there's still testing happening, which is why, you know, last year we started offering the free VantageScore, so they could adopt it and really process through their workflows, you know, both scores.

Speaker #5: So You know, I think substantially the industry's pretty well prepared, and, you know, the fact that they made the decision a few weeks ago to, you know, normalize the LLPA tables You know, I think that opens up, and we've heard a lot of feedback from our customers that they plan to really start ramping, you know, their Vantage adoption because of the big cost savings that come with it.

Mark Begor: The fact that they made the decision a few weeks ago to normalize the LLPA tables, I think that opens up and we have heard a lot of feedback from our customers that they plan to really start ramping their Vantage adoption because of the big cost savings that come with it. The numbers are quite substantial for the industry and consumers, it is $1 billion. That is hard to not focus on, particularly in this mortgage environment where the whole industry is extremely pressured by the lower activity. We see all of our customers really moving to implementation mode. So we would expect to see that adoption to grow in Q4 and then continue to accelerate in 2027.

Speaker #5: And, you know, that's the numbers are just quite substantial, you know, for the industry and consumers. It's $1 billion. You know, that's, you know, hard to not focus on, particularly in this mortgage environment where, you know, the whole industry is extremely pressured, you know, by the lower activity.

Speaker #5: So, you know, we see all of our customers really moving to implementation mode, so we would expect to see...

Speaker #10: You know, that adoption is expected to grow in the fourth quarter and then continue to, you know, accelerate in 2027. And really, really good progress in the third quarter also, with connector and technology partners enabling Vantage.

John Gamble: Really good progress in Q3 also with Connector and technology partners enabling Vantage. So there was a substantial change in Q3 which we think has a lot of momentum and is continuing.

Speaker #10: So, there was a substantial change in the third quarter, which we think has a lot of momentum and is continuing.

Operator 1: Thank you. Our next question today is coming from Surinder Thind from Jefferies. Your line is now live.

Operator: Thank you. Our next question today is coming from Surinder Thind from Jefferies. Your line is now live.

Speaker #4: Thank you. Our next question today is coming from Srinivasa Srinivasan from Jefferies. Your line is now live.

Surinder Thind: Thank you. Mark, just one question here. Can you talk about just the way that lenders are behaving or they are thinking about the consumer and their willingness to market, to spend, to originate? Obviously some sensitivity around rates and consumer behavior, but is there a delay effect that we should be thinking about, or are there certain metrics that really need to degrade before we see any material change in lender behavior?

Speaker #10: Thank you, Mark. Just one question here. Can you talk about just the way that lenders are behaving or they're thinking about the consumer? And their willingness to market, to spend, to originate.

Speaker #10: Obviously some sensitivity around, you know, rates and consumer behavior, but Is there, is there a delay effect that we should be thinking about, or are there certain metrics that really need to degrade before we see any material change in lender behavior?

Mark Begor: Yeah. I think you've seen our USIS business, which is probably the right place to look at even EWS in our consumer finance or auto card P-loan business performed very well. Our DDM business, which is where some of this activity would be, was strong, but principally around marketing activity. We haven't seen real uptick in what you would typically see when investors are more nervous about the economic conditions where they're doing more portfolio management reviews. That hasn't happened. The real indicator, I've been around consumer finance for decades, and the real indicator is unemployment. It's still quite strong, meaning employment is still quite strong. Employment is quite low. When people are working, while they can be pressured, and they are in many income demographics because of what's happening with inflation and oil, they still manage to pay their bills.

Speaker #5: Yeah, I think you've seen our USIS business, which is probably the right place to look at. Even EWS, you know, in our consumer finance or auto card P-Loan business, performed very well.

Speaker #5: Our DDM business you know, which is where some of this activity would be, you know, was strong, but principally around, you know, marketing activities.

Speaker #5: So we haven't seen, you know, real uptick in what you would typically see when investors are more nervous about the economic conditions, you know, where they're doing more portfolio management reviews.

Speaker #5: That hasn't happened. And, you know, the real indicator, you know, I've been around consumer finance for decades and, you know, the real indicator is, you know, unemployment.

Speaker #5: And, you know, it's still quite strong, meaning employment is still quite strong, employment is quite low. When people are working, you know, while they can be pressured and they are in many income demographics because of what's happening with inflation and oil, they still manage to pay their bills.

Mark Begor: I think we've seen a lot of the bank earnings last week were very strong in their consumer businesses, meaning they're originating and operating in a quite normal way. We don't see a change happening in that, and it's hard to see one happening in the medium term as we move through the quarter and into the early parts of 2027. You just don't see that on the horizon as long as unemployment stays low.

Speaker #5: And I think we've seen a lot of the bank earnings last week were very strong in their consumer businesses, meaning they're originating and operating in a quite normal way.

Speaker #5: So we don't see a change happening in that, and we don't expect you know, it's hard to see one happening, you know, in kind of the medium term as we move through the quarter and into the, you know, early parts of 2027.

Speaker #5: You know, you just don't see that on the horizon as long as unemployment stays low.

Operator 1: Thank you. Next question is coming from Kyle Peterson from Lehman Company. Your line is now live.

Operator: Thank you. Next question is coming from Kyle Peterson from Lehman Company. Your line is now live.

Speaker #4: Thank you. Next question is coming from Kyle Peterson from Neiman Company. Your line is now live.

Kyle Peterson: Great. Good morning. Thank you guys for taking the questions. I wanted to dig a little more into talent. I guess if I'm looking at the numbers there, it actually looks like you guys had a really strong quarter in talent, and you guys, I think, are being a little conservative there in the outlook. I guess, is there how the quarter trended or recent weeks based on some of the data you guys are seeing, or are you guys gaining share? Just any additional color there to explain the divergence and maybe a little more cautious outlook than I would expect would be super helpful.

Speaker #10: Great. Good morning. Thank you, guys, for taking the questions. I wanted to dig a little more into talent. So, I guess if I'm looking at the numbers there, it actually looks like you guys had a really strong quarter in talent, and you guys, I think, are being a little conservative there in the outlook.

Speaker #10: So I guess, is there

Speaker #9: Can you talk about how the quarter trended, or recent weeks, based on some of the data you guys are seeing? Are you guys gaining share?

Speaker #9: Just any additional color there to kind of explain the divergence? And maybe a little more cautious outlook than I would expect would be super helpful.

Mark Begor: Well, start with Q3 was extremely good, the strongest we have seen in a long time. I think what we have talked about is we expect the talent business to continue to perform very well, but performing consistently at the level we saw in Q3, given maybe some weakening in hiring in general, is probably something that would be difficult to deliver consistently. So we think talent is going to perform very well. They had a great Q3. We expect them to continue to perform well. But we did see some weakening in the overall hiring market, and specifically as it related to white collar hiring as we moved through the quarter, and we are just reflecting that in our guidance in general and in our commentary.

Speaker #12: Start with third quarter was extremely good, strongest we've seen in a long time, right? So, and I think what we've talked about is we expect the talent business to continue to perform very well, but performing consistently at the level we saw in the third quarter, given maybe some weakening in hiring in general is probably something that would be difficult to deliver consistently.

Speaker #12: So, we think Talent is going to perform very well. They had a great third quarter, and we expect them to continue to perform well. But we are seeing—and did see—some weakening in the overall hiring market, specifically as it related to white-collar hiring as we moved through the quarter.

Speaker #12: And we're just reflecting that in our guidance, in general, and in our commentary.

Kyle Peterson: Okay. That is really helpful and appreciate the additional color. Then wanted to switch over to the international business, particularly Latin America. Looks like you guys had a really nice quarter there, especially on a constant currency basis. So just wanted to see where is most of that growth coming from. Are you guys seeing more of this from some of the larger banks, or are you guys seeing better adoption with the Fintechs? I know Fintechs in that region have been gaining a lot of share, so where are you guys seeing the most success there? I think that would be really good for everyone to hear.

Speaker #9: Okay, okay, that is really helpful, and I appreciate the additional color. I wanted to switch over to the international business, particularly Latin America. It looks like you guys had a really nice quarter there, especially on a constant currency basis.

Speaker #9: So, I just wanted to see, where is most of that growth coming from? Are you seeing more of this from some of the larger banks, or are you seeing better adoption with fintechs?

Speaker #9: I know fintechs in that region have been gaining a lot of share. So, where are you guys seeing the most success there? I think that would be really good for everyone to hear.

Mark Begor: Yeah. It is fairly broad-based. Brazil, which is Boa Vista, as you know, where we acquired that business a little over 3 years ago, performing very well. And we think gaining some share. They are doing very well with Fintechs, and also picking up some business with the larger banks. So performing well there. Broadly, I think as you point out, in Latin America, Fintech is quite large, and is performing well, and we are well-positioned with them. So we have seen broad performance in Chile and Peru and Argentina, Ecuador, some of the other markets in Central America where we are performing well. Then as I commented on the call earlier, we are super energized to get the Círculo de Crédito deal closed. That business is also performing well. We do not own it yet, but we will soon.

Speaker #5: Yeah, it's fairly broad-based. You know, Brazil—which is Boa Vista, as you know, where we acquired that business a little over three years ago—is performing very well.

Speaker #5: And, you know, we think we're gaining some share there. They're doing very well with fintechs and also picking up some business with the larger banks.

Speaker #5: So, performing well there. Broadly, I think, as you point out, in Latin America, fintech is quite large and is performing well, and we're well positioned with them.

Speaker #5: So we've seen, you know, kind of broad performance in Chile, Peru, Argentina, and Ecuador. You know, some of the other markets in Central America, you know, where we're performing well.

Speaker #5: And then, as I commented on the call earlier, we're super energized to get the Circulo deal closed. You know, that business is also performing well.

Speaker #5: We don't own it yet. But we will soon, you know, and that business has been up strong double-digit, you know, actually growing faster than the rest of Latin America and, you know, the fastest growing, you know, kind of credit bureau business in Mexico.

Mark Begor: That business has been up strong double digit, actually growing faster than the rest of Latin America and the fastest growing credit bureau business in Mexico because they have really focused on Fintechs. They have got a very strong market position and actually do not do as much as. We see an opportunity to do more business with the banks where the competitor plays. But the Fintech growth has been super positive. And running all the plays you would expect us to run. We are now cloud native in Latin America. I think that is a big deal. We have just completed that in the quarter, so having that complete. Most of the countries have been complete for months and years, but that allows the team to fully focus on growth. We are rolling out a lot of the new AI-powered new products. I think that is benefiting us.

Speaker #5: Because they were really focused on fintechs. You know, they've got a very strong market position and actually don't do as much as, you know, we see an opportunity to do more business with the banks.

Speaker #5: You know, where the competitor plays, but the fintech growth has been super positive. And running all the plays you'd expect us to run, we're now cloud native in Latin America.

Speaker #5: I think that's a big deal. We just completed that, you know, in the quarter. So having that, you know, complete— most of the countries have been complete for, you know, months and years, but that allows the team to fully focus on growth.

Speaker #5: You know, rolling out a lot of the new AI-powered products—I think that's benefiting us. Some of the new scores that bring more data in are really powering, you know, their business down there.

Mark Begor: Some of the new scores that bring more data in is really powering their business down there, and we are pleased with how it is performing.

Speaker #5: You know, we're pleased with how it's performing.

Operator 1: Thank you. Our next question today is coming from Simon Clinch from Rothschild & Co. Redburn. Your line is now live.

Operator: Thank you. Our next question today is coming from Simon Clinch from Rothschild & Co. Redburn. Your line is now live.

Speaker #4: Thank you. Our next question today is coming from Simon Clinch from Rothschild & Company Redburn. Your line is now live. Thanks. Thanks for taking my question.

Simon Clinch: Thanks. Thanks for taking my question. I just wanted to start with the USIS B2B online business, and I just wanted to get some color as to the trajectory of growth there. We have seen some kind of pickup here to I think mid-single digit last quarter, 4% this quarter, versus low single digits before. But I was wondering if we could square how to think about this going forward, given your comments around some of the slowing we have seen in those key markets and if there is any sort of one time or unusual impacts that we need to think about as well for this business. Thanks.

Speaker #4: I just wanted to start with the USIS B2B online business. I just wanted to give some color as to the trajectory of growth there.

Speaker #4: We've seen some kind of pickup here to, you know, I think mid-single digit last quarter, 4% this quarter versus low single digits before. But I was wondering if we could square sort of how to think about this going forward, given your comments around some of the slowing we've seen in those key markets and if there's any sort of one-time or unusual impacts that we need to think about as well for this business.

Mark Begor: Yeah. Nothing one time, but you are seeing some of the benefits. As you remember, USIS was kind of our last large US business, a very large US business, to complete the cloud. So they are kind of 18, 24 months into that post-cloud mode, and they have really accelerated their new product rollouts. Their vitality index is up above north of 10% now, which is really great news. It was not for years. It was kind of in mid-single digits when they were doing the cloud transformation. So that is benefiting them commercially. And some of the new solutions, we talked about TWN Indicator that we are clearly have spent a lot of focus on in the mortgage space, but we are rolling it out in auto card and P-loan, offering that as an addition to the credit file at no cost in order to drive some share gains.

Speaker #4: Thanks. Yeah, nothing one-time, but you're seeing some of the benefits. As you remember,

Speaker #5: USIS was kind of our last large U.S. business, very large U.S. business to complete the cloud. So they're kind of 18, 24 months into that post-cloud mode.

Speaker #5: And they've really accelerated their new product rollouts. You know, their Vitality Index is up above, north of 10% now, which is really great news.

Speaker #5: You know, it wasn't for years, you know, it was kind of in mid-single digits, you know, kind of when they were doing the cloud transformation.

Speaker #5: So that's benefiting them, you know, commercially. And some of the new solutions, you know, we talked about you know, twin indicator, you know, that we, we are clearly have spent a lot of focus on in the mortgage space, but we're rolling it out in auto, card, and P-Loan.

Speaker #5: You know, offering that as an addition to the credit file, you know, at no cost in order to drive some share gains. So we're starting to see some traction there.

Mark Begor: So we are starting to see some traction there. It has been quite modest because we are early days in the rollout, but we would expect that could be a positive for us going forward. So I would think about commercial execution. We have got a new leader that we are really energized about, David Smith, who is leading the business now, and he has got his feet on the ground and really focusing on commercial execution. Then the new product rollouts, we expect to continue to be a positive for them in the quarter, as we finish the year, but more importantly, in 2027 and beyond.

Speaker #5: It's been quite modest because we're early days in the rollout, but we would expect you know, that to be a positive for us going forward.

Speaker #5: So I would think about, you know, commercial execution. We've got a new leader that we're really energized about—David Smith—who's leading the business now.

Speaker #5: You know, he's got his feet on the ground and really focusing on commercial execution. And then the new product rollouts, you know, we expect to continue to be a, you know, a positive for them in the quarter, you know, as we finish the year.

Speaker #5: But you know, more importantly in '27 and beyond.

Simon Clinch: Okay. That is useful. Thank you. Just changing tack, going back to Vantage. I was wondering if you could just help us think about. So we have gone to a unified LLPA grid for Vantage and FICO. That has been viewed as a real beneficiary for VantageScore. What if we move to an actual bespoke or specific LLPA grid for Vantage, which is not just a one-to-one map with FICO? How does that impact the likelihood of lenders using the product or any of those dynamics? Any sort of color you can give around that would be useful. Thank you.

Speaker #4: Okay, that's useful. Thank you. And just changing tack, going back to Vantage, I was wondering if you could just help us think about— so we've gone to a unified LLPA grid for Vantage and FICO's.

Speaker #4: That's been viewed as a real beneficiary for, for VantageScore. What if we move to an actual bespoke or specific LLPA grid for VantageScore? which isn't just a one-to-one map with FICO.

Speaker #4: How does that impact the likelihood of lenders using the product, or any of those dynamics? Any sort of color you can give around that would be useful.

Mark Begor: Sure. I would expect that to happen. I think it is just a matter of time, when they get to that stage, that they would have really an LLPA table that is specific to FICO Classic, which they have today, and then they would have one specific to 10T. But remember, the credit score in a mortgage underwriting process is really only used in the pre-application, pre-qualification process in order to give an indicator to the consumer before the credit data is used, which is really what is used in underwriting. It actually calculates the actual underwriting and then the actual price that that consumer is going to be offered. What the originator does is use the credit score early in the process before they submit the application to the agencies, and we are talking about GSE, FHA-type loans.

Speaker #5: I would expect that to happen. You know, I think it's just a matter of time, you know, when they get to that stage that they'd have, you know, really an LLPA table that's specific to FICO Classic, which they have today, and then they'd have one specific to 10-T.

Speaker #5: But remember, the credit score in a mortgage underwriting process is really only used in the pre-application, prequalification process in order to give an indicator to the consumer before the credit data is used, which is really what's used in underwriting, you know, actually calculates the actual underwriting and then the actual price that that consumer is going to be offered.

Speaker #5: What the originator does is use the credit score early in the process, before they submit the application to the agencies. And we're talking about, you know, GSE, FHA-type loans.

Mark Begor: They use that credit score really just as an indicator from those tables to tell the consumer that, "Hey, based on your credit score that we are looking at today, this is the kind of price that you will have." What they want to do is make sure that they are using the most accurate, complete information. Today, I think it is widely viewed that VantageScore 4.0 includes more data than FICO Classic, so it provides a more complete picture on the consumer. So that is a reason. 10T will close some of that gap once it gets approved by the agencies. But that is only an indicator. The fact that that price is dramatically different of a dollar versus 10-plus, when you are a mortgage originator, you really have to focus on both the performance of the score and that pre-qual process and the cost to actually use it.

Speaker #5: They use that credit score—really just a generic credit score from those tables—to tell the consumer that, you know, hey, based on your credit score that we're looking at today, this is the kind of price that you'll have.

Speaker #5: And what they want to do is make sure that they're using the most accurate, complete information. And today, I think it's widely viewed that Vantage 4.0 includes more data than FICO Classic, so it provides a more complete picture on the consumer.

Speaker #5: So that's a reason. 10T will close some of that gap once it gets approved by the agencies. But that's only an indicator. And the fact that that price is, you know, dramatically different of $1 versus $10+, you know, when you're a mortgage originator, you know, you really have to focus on both the performance of the score in that prequal process and the cost to actually use it.

Mark Begor: And it is just so substantially different. Our expectation is that that is going to be a real determinant, and we are seeing it with the mortgage originators in using the VantageScore because it just delivers a lot more value for the service. Just as a reminder, once the application goes in, the score is really not used in the underwriting process. The credit data is used in the tri-merge report, including the report from Equifax, to do that underwriting and to confirm the actual interest rate that is going to be offered on that mortgage based on the consumer's or the applicant's credit data, not the credit score. We think there is going to be a lot of momentum to utilize the VantageScore because of the value it delivers, both on the performance but also on the cost to use it.

Speaker #5: And it's just so substantially different. You know, our expectation is, is that that's going to be a real determinant, and we're seeing it, you know, with the mortgage originators in, you know, using the VantageScore because it just delivers a lot more value.

Speaker #5: You know, for the service. And just, you know, as a reminder, once the application goes in, the score is really not used in the underwriting process.

Speaker #5: The credit data is used in the tri-merge report, including the report from Equifax, to do that underwriting and to confirm the actual interest rate that's going to be offered on that mortgage, you know, based on the, you know, the consumer's or the applicant's, you know, credit data.

Speaker #5: You know, not the credit score. So, you know, we think there's going to be a lot of momentum to utilize the VantageScore because of the value it delivers, you know, both on the performance but also on the cost to use it.

Operator 1: Thank you. Our next question today is coming from Ryan Griffin from BMO Capital Markets. Your line is now live.

Operator: Thank you. Our next question today is coming from Ryan Griffin from BMO Capital Markets. Your line is now live.

Speaker #4: Thank you. Our next question today is coming from Ryan Griffin from BMO Capital Markets. Your line is now live.

Ryan Griffin: Hey, thank you so much. Just one from me. I wanted to ask about the new Mortgage Score Select. I know that is still early innings, but what behavioral patterns have you seen from the lenders that have worked on that workflow thus far? Thank you.

Speaker #10: Hey, thank you so much. Just one for me. I wanted to ask about the new Mortgage Score Select. I know that's still early innings, but what behavioral patterns have you seen from the lenders that have worked on that workflow thus far?

Speaker #10: Thank you.

Mark Begor: Well, we launched that solution specifically based on lender input, right? We are expecting we will see adoption. We think it creates a lot of flexibility for lenders as they are going through the approval process so that they could move forward and use a VantageScore. To the extent they see some reason through the closing process, like for instance, today with a VA loan, that they need to pull a FICO score as well, that it gives them the flexibility to do that later at a lower cost, right? Without having to repurchase the credit file. We think it is in response to industry demand and something that will be adopted, we think adopted significantly, and we think it should also help promote movement to VantageScore more quickly.

Speaker #12: Yeah, well, we launched that solution specifically based on lender input, right? So we're expecting we'll see adoption. We think it creates a lot of flexibility for lenders as they're going through the approval process.

Speaker #12: So that they could move forward and use a VantageScore, and to the extent they see some reason through the closing process, like for instance today with a VA loan, that they need to pull a FICO score as well, that it gives them the flexibility to do that later.

Speaker #12: At a lower cost, right, without having to repurchase the credit file. So we think it's in response to industry demand and something that will be adopted—we think adopted significantly.

Speaker #12: And we think it should also help promote movement to VantageScore more quickly.

Operator 1: Thank you. Next question is coming from Andy Grobler from BNP Paribas. Your line is now live.

Operator: Thank you. Next question is coming from Andy Grobler from BNP Paribas. Your line is now live.

Speaker #4: Thank you. Next question is coming from Andy Grobbler from BNP Paribas. Your line is now live. Hi, good morning. Thank you for taking my question.

Andy Grobler: Hi. Good morning. Thank you for taking my question. Firstly, just to go back to John's comment from earlier about seeing some slowing in FICO and auto volumes in the latter part of the quarter, can you quantify at all to what extent that slowed, and has that continued into the early part of Q4? Thank you.

Speaker #4: Firstly, just to go back to John's comment from earlier about seeing some slowing in FICO and auto volumes. In the, in the latter part of the quarter.

Speaker #4: Can you quantify at all to what extent that, that slowed, and has that continued into

Speaker #5: the early part of Q4? Thank you. Yeah, I think we quantified that the mortgage market clearly slowed in the 3rd quarter, and that impacted us in the neighborhood of $20 million negative.

Mark Begor: Yeah. I think we quantified that the mortgage market clearly slowed in Q3, and that impacted us in the neighborhood of $20 million negative in Q3. Then we also sized for you what the impact at current run rates, which is the only thing we can run off, the impact would be in Q4. Is that what your question's about?

Speaker #5: In the 3rd quarter. And then we also sized for you, you know, what the impact at current run rates, which is the only thing we can run off, the impact would be in the 4th quarter.

Speaker #5: Is that what your question is about?

Andy Grobler: No, I was-

Speaker #12: No, I said auto and FI, not— I think we heard FICO. But no, we saw some slowing. We didn't say it was substantial. But we did see some slowing since it occurred.

Mark Begor: I said auto and FI, not. I think we heard FICO. We saw some slowing. We did not say it was substantial, but we did see some slowing since it occurred. We reflected in what we are seeing in Q4, and we just wanted to share with you that that was something we were starting to see as you are considering Q4 as well. That is all.

Speaker #12: We reflected on what we're seeing in the fourth quarter, and we just wanted to share with you that that was something we were starting to see as you're considering the fourth quarter as well.

Speaker #5: That's all.

Andy Grobler: Okay. Thank you. Then just a follow-up on the government vertical. You had a very good quarter, again, in terms of growth. There has been some change in competition in that market with a relatively new entrant in Truv winning at least a couple of state contracts. Are you seeing the dynamics in that market change at all? Is there space for all of you, given the size of the TAM or anything else we should consider about the changing competitive environment? Thank you.

Speaker #4: Okay, thank you. And then just a follow-up on, on the government vertical. So you had a very good quarter again in terms of growth.

Speaker #4: There has been some change in competition in that market, with a relatively new entrant in Troove winning at least a couple of state contracts.

Speaker #4: Are you seeing the dynamics in that, in that market change at all? Is there space for, for all of you, uh, given the size of the TAM, or anything else we should consider about kind of the changing competitive environment.

Speaker #4: Thank you.

Mark Begor: Yeah. There have been other competitors around for quite some time. I think you should talk to them about how large their contracts are or are not. Our understanding is they are quite small. But obviously we focus on competitors that are trying to enter the space. As you point out, it is a very big TAM. There is a lot of space to participate. We think we have a very strong offering with the instant solution from Equifax through The Work Number dataset that is extremely competitive. And we have been investing in new solutions, particularly around consumer-consented data, where we do not have all the records to have an integrated solution.

Speaker #5: Yeah, there have been other competitors around for quite some time. I think you should talk to them about how large their contracts are, or are not.

Speaker #5: You know, our understanding is they're, you know, quite small. But obviously, we focus on competitors that are trying to enter the space.

Speaker #5: As you point out, it's a very big TAM. You know, there's a lot of space to participate. You know, we think we have, you know, a very, very strong you know, offering, you know, with the instant solution, you know, from Equifax through the TWIN dataset, you know, that's extremely competitive.

Speaker #5: And we've been investing in new solutions, you know, particularly around, you know, consumer consented data, you know, where we don't have, you know, all the records to have an integrated solution.

Mark Begor: And what we hear from our customers is that they really want an integrated solution because they think about the first place they want to check is The Work Number database because it has such large coverage, and then integrate into solutions like our consumer consented, which we have signed a couple of states on it. So big space, we think we have a strong position, and we are going to continue to invest to make sure we maintain that.

Speaker #5: What we hear from our customers is that they really want an integrated solution, because the first place they want to check is the TWIN database, since it has such large coverage.

Speaker #5: And then integrate into solutions like our consumer-consented, which we've signed a couple of states on. So, big space, we think we have a strong position.

Speaker #5: You know, and we're gonna continue to invest to make sure we maintain that. Excellent. Thank you very much.

Andy Grobler: Excellent. Thank you very much.

Operator 1: Thank you. Next question is coming from Kevin McVeigh from UBS. Your line is now live.

Operator: Thank you. Next question is coming from Kevin McVeigh from UBS. Your line is now live.

Speaker #4: Thank you. Next question is coming from Kevin McVane from UBS. Your line is now live.

Kevin McVeigh: Great. Thanks so much. Great to see the cost momentum. I guess, could you help us understand what drove the upsize, the $150 million up from $75 million, on the AI? Then I think you talked, and maybe it is in nuances, but just cost management versus AI-driven cost efficiencies. Maybe just dimensionalize what those two things are. I guess first, just the $150 million up from $75 million, and then the cost management versus AI efficiencies.

Speaker #9: Great, thanks so much. Great to see the cost momentum. I guess, could you help us understand what drove the upsize, the $150 million up from $75 million?

Speaker #9: On the AI—and then I think you talked, and maybe it's nuances—but just cost management versus AI-driven cost efficiencies. Maybe just dimensionalize what those two things are.

Speaker #9: But I guess first, just the $150, up from $75, and then, you know, the cost management versus AI efficiencies. Yeah, I think, as you know, we announced the $75 back in February.

Mark Begor: Yeah. I think as you know, we announced the $75 million back in February. We doubled that in July to $75 million because of the momentum we have seen on AI deployment. Our early AI deployment, think about the latter half of 2025 inside of Equifax was in operations. Most companies start there in call centers and document processing centers are kind of purpose built for that. I talked a bunch about on the call already this morning that we think the fact we invested so heavily in our tech stack over the last 5 years, and that is obviously behind us now that we are cloud complete and in the cloud, but that positioned us to really effectively deploy AI we think better than others. So the $75 million was our first step of sharing with you what we are doing internally as far as some of the AI productivity going forward.

Speaker #5: We doubled that in July to $75, because of the momentum we've seen on AI deployment. Our early AI deployment—think about the latter half of 2025 inside of Equifax—was in operations.

Speaker #5: You know, most companies start there in call centers and document processing centers are kind of purpose-built for that. I talked a bunch about on the call already this morning that we think the fact we invested so heavily in our tech stack over the last 5 years, and that's obviously behind us now that we're cloud complete and in the cloud, but that positioned us to really effectively deploy AI.

Speaker #5: we think better than others. And so the $75 was our first step of sharing with you what we're doing internally as far as some of the AI productivity.

Mark Begor: And then we have just seen kind of rapid adoption. The big change between February and July and now is that the deployment of AI in Equifax in technology, that is our largest team. As you know, we are a data analytics technology company. But using AI for coding new products and capabilities has seen a really rapid adoption and deployment by our teams, which is super positive. And then we are also seeing in finance, HR legal, AI being deployed there to drive efficiencies. And I said it on the prepared comments earlier this morning that we are still early innings on this. I think that is what is exciting for me and John and the rest of the Equifax team is that we just see a lot of potential going forward.

Speaker #5: Going forward. And then we've just seen kind of rapid adoption. The big change between February and July and now is that the deployment of AI in Equifax in technology, that's our largest team.

Speaker #5: As you know, we're a data analytics technology company, but using AI for coding new products and capabilities is seeing really rapid adoption and deployment by our teams, which is super positive.

Speaker #5: And then we're also seeing, in finance, HR, and legal, AI being deployed there to drive efficiencies. You know, I said in the prepared comments earlier this morning that we're still in the early innings on this.

Speaker #5: You know, I think that's what's exciting for me, John, and the rest of the Equifax team, is that we just see a lot of potential going forward.

Mark Begor: So when we think about that translating into operating margin dollars and margin rate, obviously we have a metric we use is our margin rate. We started doing it ex-FICO, so it is really more clear around the fact that FICO distorts that in some way because we pass through the FICO score with no margin on it. And we set a goal in our long-term framework to grow our margin rate 50 basis points per year. We set a goal early in the year to do 75, and as you know, we have outperformed it in Q1, Q2 and Q3, which is why we now raised it to 100 basis points. So inside of that 100 basis points of margin expansion, the biggest lever we have is operating leverage. If our revenue is growing and our costs are growing slower than the revenue, you get operating leverage that drives margin expansion.

Speaker #5: So, when we think about that translating into operating margin dollars and margin rate—obviously, the metric we use is our margin rate.

Speaker #5: We've started doing it ex-FICO, so it's really more clear around the fact that FICO distorts that in some way, because we pass through the FICO score with no margin on it.

Speaker #5: You know, we set a goal in our long-term framework to grow our margin rate 50 basis points per year. We set a goal early in the year to do 75, and as you know, we've outperformed it in the first, second, and third quarter.

Speaker #5: Which is why we have now raised it to 100 basis points. So, inside that 100 basis point margin expansion, the biggest lever we have is operating leverage.

Speaker #5: If our revenue's growing and our costs are growing slower than the revenue, you get operating leverage that drives margin expansion. So that's the way I think about it—and we think about it—that kind of 50 basis points in our long-term framework is the operating leverage that we should get.

Mark Begor: So that is the way I think about it and we think about it, that kind of 50 basis points in our long-term framework is the operating leverage that we should get from our 7% to 10% long-term organic growth rate. So that is clearly a base part of how we think about the business going forward, and that becomes free cash flow. And that free cash flow it becomes substantially ends up in buyback because that is where the incremental cash is going to go. And then the new gear, the new lever for us in operating margin expansion is really the deployment of AI across Equifax. We branded it internally as AI 4 EFX.

Speaker #5: From our 7% to 10% long-term organic growth rate, you know, that is clearly a base part of how we think about the business going forward. That becomes free cash flow, and in that free cash flow, it substantially ends up in buybacks because that's where the incremental cash is going to go.

Speaker #5: And then the new gear, the new lever for us in operating margin expansion is really the deployment of AI across Equifax. You know, we branded it internally as "AI for EFX."

Mark Begor: We have it as one of our strategic priorities that we set out in January, was not only to deploy AI for our products, models, and scores to drive our top line, but also to really aggressively deploy AI across Equifax to drive speed, to drive efficiencies, to drive capacity, and also to drive productivity. So that was the $150 million that we laid out in July, we were clear that was going to be a multi-year impact that is going to impact both OpEx and CapEx because a lot of our technology costs get capitalized. So as we have efficiencies there will be OpEx savings, but also CapEx.

Speaker #5: We have it as one of our strategic priorities that we set out in January, was not only to deploy AI for our products, models, and scores to drive our top line, but also to really aggressively deploy AI across Equifax to drive speed, to drive efficiencies, to drive capacity, and also to drive productivity.

Speaker #5: That was the $150 million that we laid out in July. We were clear that was going to be a multi-year impact that's going to affect both OpEx and CapEx because, you know, a lot of our technology costs get capitalized.

Speaker #5: So as we have efficiencies there, there'll be OpEx savings but also CapEx. So, you know, we're really energized around our ability to deploy AI, and I think we're one of the few info services stocks out there that have put a marker out fairly early in the AI journey around, you know, the benefits that we expect to get from it, which is, again, that $150 million. And then obviously, it's showing up in our P&L in 2026, you know, and, you know, with our ability to increase our operating margin rate guidance for the year, you know, while having the significant, you know, mortgage top-line pressure, you know, we think, you know, shows a lot to us as well as to our investors that there's some real positive change happening in how we run our business internally from an efficiency and AI productivity standpoint.

Mark Begor: So we are really energized around our ability to deploy AI. I think we are one of the few info services stocks out there that have put a marker out fairly early in the AI journey around the benefits that we expect to get from it, which is again, that $150 million. Then obviously, it is showing up in our P&L in 2026. With our ability to increase our operating margin rate guidance for the year while having the significant mortgage top-line pressure, we think shows a lot to us as well as to our investors that there is some real positive change happening in how we run our business internally from an efficiency and AI productivity standpoint.

Kevin McVeigh: Very helpful. Thank you.

Speaker #5: Very helpful. Thank you.

Operator 1: Thank you. Next question is coming from Scott Wurtzel from Wolfe Research. Your line is now live.

Operator: Thank you. Next question is coming from Scott Wurtzel from Wolfe Research. Your line is now live.

Speaker #4: Thank you. Next question is coming from Scott Wurzel from Wolfe Research. Your line is now live.

Scott Wurtzel: Hey, good morning, guys. Thanks for taking my questions. Just two on the government side of things. Wondering if you can talk about maybe how much of the new ACV that you are seeing is being driven by some of these new products that you have introduced into the ecosystem. Then just a clarification on the renewal ACV. Does that include any sort of expansion with current customers or price increases, or is that just a straight renewal of existing services? Thanks.

Speaker #10: Hey, good morning, guys. Thanks for taking my questions. Just two on the government side of things. Wondering if you can talk about maybe how much of the new ACV that you're seeing is being driven by some of these new products that you've introduced into the ecosystem.

Speaker #10: And then

Speaker #12: Just a clarification on the renewal ACV. Does that include any sort of like expansion with current customers or pricing increases, or is that just a straight renewal of existing services?

Speaker #12: Thanks.

Mark Begor: Yeah. So on your second question, it would be substantially renewal of existing business, but there is always some element of price in a lot of the conversations. There is also the element of we add new solutions in those renewals, and then the new ACV we think about as being kind of new customers. And there is clearly, when you think about what is driving the bulk of that revenue, I would think about it as our core products, about verifying income that we have been doing for a lot of years. But there is an element of the new solutions we have talked about over the last six, nine, 12, 18 months that we are adding into the market, like Continuous Evaluation for our customers and the Complete Income, adding that as a solution where we are adding some of the consumer consented stuff.

Speaker #5: Yeah, so on your second question, it would be substantially renewal of existing business, but there's always some element of price in a lot of the conversations.

Speaker #5: There's also the element where we add new solutions in those renewals. And then, the new ACV we think about as being kind of new customers.

Speaker #5: And there's clearly, when you think about what's driving the bulk of that revenue, I would think about it as our core products, you know, about verifying income, you know, that we've been doing for, you know, a lot of years.

Speaker #5: But there's an element of the new solutions we've talked about over the last 6, 9, 12, 18 months that we're adding into the market, like continuous evaluation for consumers—for our customers—and, you know, the complete income, you know, adding that as a solution where we're adding some of the consumer-consented stuff.

Mark Begor: The bulk of that new ACV would be in what I would call our core solutions, and just really penetrating the TAM. I think a lot of us forget, meaning our investor base, that we have a big business, obviously, and we have a big business that is growing. But we operate in a TAM that is substantially manual. When you think about the $5 billion TAM and the 4-plus billion of that TAM that we do not participate in today, that is states, that is agencies, that is federal government, that is local government, kind of social services that are being done principally manually. That is the opportunity for us to really deliver the real value we deliver in our core solution, which is speed of social service delivery, caseworker productivity. Think about a $5, $7, $10 transaction with Equifax versus a caseworker who is paid $30 an hour with benefits working on it.

Speaker #5: So, you know, the bulk of that new ACV would be in what I would call our core solutions, and just really penetrating the TAM.

Speaker #5: You know, it's, I think a lot of us forget, meaning our investor base, that, you know, we have a big business, you know, obviously, and we have a big business that's growing, but we operate in a TAM that's substantially manual.

Speaker #5: You know, when you think about the $5 billion TAM and the $4+ billion of that TAM that we don't participate in today. You know, that's states, that's agencies, that federal government, that's local, you know, local government, you know, kind of social services that are being done principally manually, you know, so that's the opportunity for us to really deliver, you know, the real value we deliver in our core solution, which is speed of social service delivery.

Speaker #5: You know, caseworker productivity, you know, think about a $5, $7, $10 transaction with Equifax versus, you know, a caseworker who's you know, paid $30 an hour with benefits, you know, working on it.

Mark Begor: And then obviously the huge integrity side, and there has been increased focus around attacking the way the federal government frames the $180 billion of improper payments that happen and the roughly $1 trillion of social service delivery. So we just have strong momentum in our pipelines and really a good runway going forward to continue to penetrate into that big TAM.

Speaker #5: And then, obviously, the huge integrity side—you know, there's been increased focus around attacking the way the federal government frames the $180 billion of improper payments that happen in the roughly $1 trillion of social service delivery.

Speaker #5: So, you know, we just have strong momentum in our pipelines and, you know, really a good runway going forward to continue to penetrate into that big TAM.

Scott Wurtzel: Great. Thank you.

Speaker #5: Great, thank you.

Operator 1: Thank you. Next question is coming from Kelsey Zhu from Autonomous Research. Your line is now live.

Operator: Thank you. Next question is coming from Kelsey Zhu from Autonomous Research. Your line is now live.

Speaker #4: Thank you. Next question is coming from Kelsey Zhu from Autonomous Research. Your line is now live.

Kelsey Zhu: Good morning. Thanks for taking my question. What is your expectation around paid VantageScore adoption in the mortgage vertical in the medium term? Any updates on FICO 10T implementation timeline for the GSE loans and how that might change the competitive landscape between FICO and VantageScore? Thanks a lot.

Speaker #10: Good morning, thanks for taking my question. What is your expectation around paid VantageScore adoption in the mortgage vertical in the medium term, and any updates on FICO 10C implementation timeline for the GSE loans and how that might change the company's competitive landscape between FICO and VantageScore?

Speaker #10: Thanks a lot.

Mark Begor: Yeah. The paid Vantage is still fairly small. I think we've been clear about that. The free Vantage is very high, and we think about that as an indicator of the industry's focus on preparing to move to Full Vantage. When we talk to our customers, and some of them put out press releases, you can check on that, there's clearly a lot of focus on taking advantage of the huge cost savings that come with Vantage. With regards to 10T adoption and activation, you should talk to FICO. We're not involved in that. That's something FICO is working on. I suspect there'll be a point in time where it will be adopted, but we're not close enough to know what's happening or not happening in that space.

Speaker #5: Yeah, so the paid Vantage is still fairly small. I think we've been clear about that. The free Vantage is very high, and we think about that as an indicator of the industry's focus on preparing to move to full Vantage.

Speaker #5: And then when we talk to our customers, and some of them put out press releases, you can check on that. You know, there's clearly, you know, a lot of focus on taking advantage of the huge cost savings, you know, that come with Vantage.

Speaker #5: With regards to 10T, you know, adoption and activation, you know, you should talk to FICO. You know, we're not involved in that. You know, that's something FICO is working on.

Speaker #5: You know, I suspect there'll be a point in time where it will be adopted, but we're not close enough to know, you know, what's happening or not happening in that space.

Mark Begor: We do believe that 10T will close what we view as a gap between FICO Classic and VantageScore 4.0 from a performance standpoint. I think it's well understood in the industry that VantageScore 4.0 includes more data, has more trended data, and provides a more complete picture on the consumer around what their creditworthiness is. So I think that's well understood. Our view is that 10T will close some of that. You've got the challenge of that's at least currently priced at over $10 a score versus Vantage is at a buck. That's a massive delta that we think advantages Vantage even when 10T is in the marketplace.

Speaker #5: We do believe that, you know, 10T will close what we view as a gap between FICO Classic and Vantage 4.0 from a performance standpoint.

Speaker #5: I think it's well understood in the industry that Vantage 4.0 includes more data, has more trended data, and provides a more complete picture on the consumer, you know, regarding their creditworthiness.

Speaker #5: You know, so I think that's well understood. Our view is that 10T will close some of that, but then you've got the challenge of, you know, that's at least currently priced at over $10 a score versus Vantage is at a buck.

Speaker #5: You know, that's a massive delta that, you know, we think advantages, you know, Vantage even when 10T is in the marketplace.

Kelsey Zhu: Got it. Very helpful. Director Pulte also alluded to releasing the GSE credit scores to the marketplace. Is that something you have been working with the agency on, and how are you thinking about having Fannie score and Freddie score potentially competing with VantageScore in the marketplace?

Speaker #11: Got it. Very helpful. Director Polkey also alluded to releasing the GSE credit scores to the marketplace. Is that something you've been working with the agency on, and how are you thinking about having FannieScore and FreddieScore potentially competing with VantageScore in the marketplace?

Mark Begor: Yeah, I think you would have to talk to FHFA about their plans on that. While we collaborate very closely with them because they are a close partner, I would not want to comment on what they are or are not going to do around their own credit scores. I think it is well understood that the way the underwriting process works is that after the application goes in, the score, VantageScore or FICO Classic score, is not used in that underwriting process. The credit data is used in that process, and they have an underwriting process that is very robust and very complex and very sophisticated, that ingests all of the trade lines from all three credit reports in order to do their underwriting, because remember, they own the loan at closing. And that includes some element of score calculation that they use internally.

Speaker #5: Yeah, I think you'd have to talk to FHFA about their plans on that. You know, while we collaborate very closely with them because they're a close partner, you know, I wouldn't want to comment on what they are or are not going to do, you know, around, you know, their own credit scores.

Speaker #5: You know, we know that they— you know, I think it's well understood that the way the underwriting process works is that after the application goes in, the score—you know, VantageScore or FICO Classic Score—is not used in that underwriting process.

Speaker #5: The credit date is used in that process, and they have an underwriting process that's very robust, very complex, and very sophisticated. You know, that ingests all of the trade lines from all three credit reports in order to do their underwriting, because remember, they own the loan at closing. That includes, you know, some element of score calculation that they use internally, but you'd have to talk to them about, you know, what they think they might want to do with that in the marketplace.

Mark Begor: But you would have to talk to them about what they think they might want to do with that in the marketplace.

Operator 1: Thank you. Our next question today is coming from Craig Huber from Huber Research Partners. Your line is now live.

Operator: Thank you. Our next question today is coming from Craig Huber from Huber Research Partners. Your line is now live.

Speaker #4: Thank you. Our next question today is coming from Craig Huber from Huber Research Partners. Your line is now live.

Craig Huber: Great. Thank you. My first question is, if we go back to October 2022, when the Biden administration proposed going to bi-merge, and then given all the pressure, nothing happened on that front through the rest of the administration, roughly 27 months. I guess my question to you is what is changed in the marketplace out there that even if Director Pulte wants to go that route here, besides the fact we have a different administration, what is changed now that it would actually get implemented somewhat quickly? Obviously, you talked about the Treasury being against it, a lot of congressmen being against it, regulatory folks underneath Director Pulte being against it, much of the industry against it. But what is changed that actually could get implemented this time if he wants to go that way?

Speaker #7: Great, thank you. My first question is, if we go back to October of 2022, when the Biden administration proposed going to Buy Merge, and then given all the pressure, etc., nothing happened on that front through the rest of the administration—roughly 27 months.

Speaker #7: I guess my question to you is, what's changed in the marketplace out there that, even if Pulte wants to go that route here—besides the fact we have a different administration—what's changed now that it would actually get implemented somewhat quickly?

Speaker #7: Obviously, you talked about the Treasury being against it, a lot of congressmen being against it, regulatory folks underneath Pulte being against it, much of the industry against it, et cetera.

Speaker #7: But what's changed that actually could get implemented this time if he wants to go that way?

Mark Begor: Craig, as a reminder, when you go back to the Biden administration, they did a study and they got industry input. So it was a very formal process. They reached out to the industry. We provided inputs. I think our competitors did. I am sure FICO did, and the industry participants did. And they really asked to do a study on two things. Number one, moving from tri-merge to bi-merge, and at the same time, they proposed going to VantageScore and FICO score, meaning requiring both scores be used. There was a lot of input from the industry. I think universally, the industry input was a move from tri-merge to bi-merge was not a good thing for the consumer, was not going to provide a complete picture on the consumer. It was going to result in situations where consumers are not approved.

Speaker #5: Yeah, Craig, as a reminder, when you go back to the Biden administration, you know what they were— they did a study and they got industry input.

Speaker #5: So, it was a very formal process. They reached out to the industry. We provided inputs. I think our competitors did. I'm sure FICO did.

Speaker #5: You know, and the industry participants did. And they really asked to do a study on two things. Number one, moving from tri-merge to bi-merge.

Speaker #5: And at the same time, they proposed going to Vantage and FICO score—meaning requiring both scores be used. There was a lot of input from the industry.

Speaker #5: I think, universally, the industry input was a move from tri-merge to bi-merge, you know, wasn't a good thing for the consumer; wasn't going to provide a complete picture on the consumer; was going to result, you know, in situations where consumers aren't approved; was going to result in situations where consumers are paying a higher interest rate because you're not having the complete picture on them.

Mark Begor: It was going to result in situations where consumers are paying a higher interest rate because you are not having the complete picture on them. And then it was also going to result in a less accurate, less complete underwriting because you are not going to have the trade lines, including some of the negative trade lines on a consumer. So there is a safety and soundness impact. And at the same time, there was feedback from the industry that understands how the process works well, that there was no value in having two credit scores used in really the pre-qual process. And then that is really how that unfolded. But that same sentiment around tri-merge to bi-merge, it has not changed today from my perspective, from what I know in my communications and our communications around the valley. The facts are the facts.

Speaker #5: And then it was also going to result in a, you know, a less accurate, less complete underwriting, because you're not going to have the trade lines, you know, including some of the negative trade lines on a consumer.

Speaker #5: So there's a safety and soundness impact. And at the same time, you know, there was feedback from the industry that understands how the process works well that there was no value in having 2 credit scores used in really the prequal process.

Speaker #5: And then, you know, that's really how that unfolded. But that same sentiment around tri-merge to bi-merge, it hasn't changed today from my perspective, from what I know in my communications and our communications around the Valley.

Speaker #5: The facts are the facts. You know, because our contributory system in the United States is voluntary to the three credit bureaus, not every financial institution contributes every trade line to all three credit bureaus.

Mark Begor: Because of our contributory system in the United States is voluntary to the three credit bureaus, not every financial institution contributes every trade line to all three credit bureaus. And that results in meaningful differences between the three credit reports. And when you are talking about something as substantial as a home mortgage, that is the largest transaction any homeowner does, any consumer does, it can have significant impacts on whether they are approved, what the price they pay if you do not have all the data on that consumer. So I think that is well understood. And then the safety and soundness is crystal clear. If you are going to exclude data, that is okay if it is positive data.

Speaker #5: And that results in meaningful differences between the three credit reports. When you're talking about something as substantial as a home mortgage, that's the largest transaction any homeowner or any consumer does.

Speaker #5: It can have significant impacts, you know, on whether they're approved, and what price they pay if you don't have all the data on that consumer.

Speaker #5: So I think that's well understood. And then the safety and soundness is crystal clear. You know, if you're going to exclude data, that's okay if it's positive data, but if it's negative data and you don't know, when you're only doing a bi-merge, whether you're getting all of the complete information on that consumer and whether there's negative data out there that means that loan is riskier, that's something that's on the shoulders of the federal government.

Mark Begor: But if it is negative data and you do not know when you are only doing a bi-merge, whether you are getting all of the complete information on that consumer and whether there is negative data out there, that means that loan is riskier. That is something that is on the shoulders of the federal government. I remind investors when I am in one-on-one meetings often that some of the most sophisticated non-mortgage lenders pull tri-merge for all of the reasons I described. They own the loan. It is on their balance sheet. They want to approve every consumer. They want to give the consumer the right price, meaning the price that they qualify for based on all of their trade line data.

Speaker #5: And I remind investors when I'm in one-on-one meetings, often, that some of the most sophisticated non-mortgage lenders pull tri-merge for all of the reasons I described.

Speaker #5: They own the loan—it's on their balance sheet. They want to approve every consumer. They want to give the consumer the right price, meaning the price that they qualify for based on all of their trade line data.

Mark Begor: That is why even in non-mortgage, where there is no requirement, the most sophisticated lenders will pull a tri-merge because they want to get that complete picture on approvals to approve more, and they also want to have the complete picture on the loans they put on their balance sheet.

Speaker #5: And that's why, even in non-mortgage, where there's no requirement, the most sophisticated lenders will pull a tri-merge, because they want to get that complete picture on approvals to approve more. And they also want to have the complete picture on the loans they put on their balance sheet.

Craig Huber: I appreciate that. I think what you say makes an awful lot of sense. You have said that many times over the years publicly, and I am sure privately as well to the regulators. My question further is here, you have got Director Pulte out there being very upset about what he perceives as the price to value for credit reports, but also the price increases as he goes on and on about now versus, say, last year. Can you just quantify for us how much, apples to apples, if you are willing to, apples to apples, how much your credit file price has gone up this year versus last year?

Speaker #7: I appreciate that. I mean, I think what you say makes an awful lot of sense. You've said that many times over the years, publicly and I'm sure privately as well, to regulators.

Speaker #7: My question further is, you've got Director Pulte out there, being very upset about what he perceives as the price-to-value for credit reports, but also the price increases.

Speaker #7: Is he goes on and on about now versus, say, last year. Can you just quantify for us how much apples to apples, if you're willing to, apples to apples, how much your credit file price has gone up this year versus last year?

Craig Huber: Just like this year versus-

Speaker #5: Just like this year versus—yeah, two years ago, however you want to talk about it. But just, why is he so upset about the price increase from his vantage point?

Mark Begor: Yeah.

Craig Huber: Versus 2 years ago, however you want to talk about it. Why is he so upset about the price increase from his Vantage point? Thank you.

Mark Begor: Well, I think you would have to talk to him. We talked to him, lots of the industry participants, too. We have got a lot of respect for Director Pulte, and we have applauded his decision, which was really groundbreaking, along with Secretary Turner at FHA, to drive adoption of Vantage to drive some score competition. From our perspective, I think we all know what has happened with FICO pricing over the last 5 years, and I think that has been the principal focus of the regulators around the impact that has had on the mortgage industry as well as the impact that has had on consumers. Because remember, ultimately, consumers pay for their credit reports at closing, and so they have been bearing this cost of the rapid increase of the FICO score. Our pricing year-over-year is actually down on the credit file.

Speaker #5: Thank you. Well, I think you'd have to talk to him. We talked to him, lots of the industry participants too. We've got a lot of respect for Director Pulte, and, you know, we've applauded his decision, which was really, you know, groundbreaking, along with Secretary Turner at FHA, to drive adoption of Vantage, to drive some score competition.

Speaker #5: You know, from our perspective, you know, I think we all know, you know, what's happened with FICO pricing over the last 5 years. And I think that's been the principal focus, you know, of the regulators, you know, around the impact that's had on the mortgage industry.

Speaker #5: As well as the impact that's had on consumers. Because remember, ultimately, consumers pay for their credit reports at closing, and, you know, so they've been bearing this cost of, you know, the rapid increase of the FICO score.

Speaker #5: You know, our pricing is, you know, year over year is actually down on the credit file. You know, we, you know, have been, you know, tried to be very supportive of the industry.

Mark Begor: We have tried to be very supportive of the industry given the pressures that they are under and also supporting consumers. I think the VantageScore itself, the fact that we are being super responsible and super supportive of the industry and consumers with the $1 pricing. As I said this morning, last week, we announced to our customers we are going to extend that not only through 2027 but through 2028, meaning keeping it flat at a buck, so we can provide that support in probably the most challenging mortgage environment that we have seen in decades and support consumers who are struggling with the cost of homeownership. This provides a clearly recognized, a very small benefit, but a positive benefit for them of the dollar versus $10.

Speaker #5: You know, given the pressures that they're under, and also supporting consumers. And, you know, I think the VantageScore itself—the fact that, you know, we're being super responsible and super supportive of the industry and consumers with the $1 pricing.

Speaker #5: And as I said this morning, last week we announced to our customers we're going to extend that not only through '27 but through '28, meaning keeping it flat at $1.

Speaker #5: You know, so we can provide that support in a probably the most challenging mortgage environment that we've seen in decades, you know, and support consumers, you know, who are struggling with the cost of homeownership.

Speaker #5: You know, this provides, you know, clearly recognized a very small benefit, but a positive benefit for them of the, you know, $1 versus $10.

Mark Begor: Remember, we launched PreQual and PreApproval products, which are at much lower prices, which give our customers and mortgage underwriters the ability to manage their credit costs as they see fit.

Speaker #12: And remember, we launched Free Qual and pre-approval products, which are at much lower prices. These give our customers and mortgage underwriters the ability to manage their credit costs as they see fit.

Mark Begor: Right.

Operator 1: Thank you. Next question is coming from Craig Moore from FT Partners. Your line is now live.

Mark Begor: Right.

Operator: Thank you. Next question is coming from Craig Moore from FT Partners. Your line is now live.

Speaker #4: Thank you. Next question is coming from Craig Moore from FT Partners. Your line is now live.

Craig Moore: Yeah. Hi, thanks. Just quick, I wanted to follow up on the international question. What are some of the trends you are seeing in APAC that drove the sharp acceleration in Q3?

Speaker #10: Yeah, hi, thanks. Just quick, I wanted to follow up on the international question. What are some of the...

Speaker #6: What trends are you seeing in APAC that drove the sharp acceleration in the third quarter? And, where is the largest opportunity for international growth in 2027?

Mark Begor: Yeah.

Craig Moore: Where is the largest opportunity for international growth in 2027?

Mark Begor: Yeah. Great questions. We are really pleased with the Australia performance. I think a piece of that is that they are really moving well down the path of their cloud completion. That is the last place that we have to finish. But I think they have got a lot of that complete, which is allowing them to more broadly focus on innovation and new products. Our leader, Mel Cochrane, is doing a great job down there in the marketplace. We have had some share gains versus our competitors in that marketplace, which has really been a positive. We expect that to be a solid grower for us as we move forward in the future. Your question around where do we expect to see growth as we look forward internationally. Latin America is clearly going to be the fastest-growing geography for us. It is obviously a big place, and we have got big positions.

Speaker #5: Yeah, great questions. You know, we're really pleased with the Australia performance. You know, I think a piece of that is that they're really moving well down the path of their cloud completion.

Speaker #5: That's the last place that we have to finish, but you know, I think they've got a lot of that complete, which is allowing them to more broadly focus on innovation and new products.

Speaker #5: Our leader, Mel Cochran, is doing a great job down there in the marketplace. We've had some share gains versus our competitors in that marketplace, which has really been a positive.

Mark Begor: We have had some share gains versus our competitors in that marketplace, which has really been a positive. We expect that to be a solid grower for us as we move forward in the future. Your question around where do we expect to see growth as we look forward internationally. Latin America is clearly going to be the fastest-growing geography for us. It is obviously a big place, and we have got big positions.

Speaker #5: And we expect that to be a solid grower for us as we move forward in the future. Your question around where we expect to see growth—you know, kind of as we look forward internationally—Latin America is clearly going to be the fastest-growing geography for us.

Speaker #5: It's obviously a big place, and we've got big positions. Remember, we entered Brazil three years ago with the Boavista acquisition. The leader down there is doing a great job driving innovation and growth.

Mark Begor: And remember, we entered Brazil 3 years ago with the Boa Vista acquisition. Leader down there is doing a great job driving innovation and growth. Enrique Morales is doing a terrific job of really driving the growth in that business in Brazil. We are super energized to get Círculo closed. That business has been growing over 20% so far in 2026. So really a strong performance there. That will be a positive contributor as we get it closed in Q4 as we move into 2027. Then in the more, I would call it traditional markets for us that are more developed markets, maybe is a better term of like Canada and UK. We are looking for those businesses, some of the innovation, new products that they have got in the marketplace. We are seeing progress around share gains and performance in those markets.

Speaker #5: Enrique Morales is doing a terrific job—you know, really driving the growth in that business. In Brazil, we're super energized to get Circulo closed.

Speaker #5: You know, that business has been growing, you know, very, you know, kind of over 20%, you know, so far in 2026. So really a strong performance there.

Speaker #5: So that'll be a positive contributor. You know, as we get it closed in the 4th quarter, as we move into 2027. And then in the more, you know, I would call it traditional markets for us that you know, more developed markets maybe is a better term, of like Canada and UK, you know, we're looking for those businesses, you know, some of the innovation, new products that they've got in the marketplace.

Speaker #5: You know, we're seeing progress, you know, around, you know, share gains and performance in those markets. So we would expect them to, you know, be, you know, positive, you know, for growth as we look forward.

Mark Begor: So we would expect them to be positive for growth as we move forward.

Craig Moore: Thank you.

Speaker #5: Thank you.

Operator 1: Thank you. Next question is coming from Owen Lau from Clear Street. Your line is now live.

Operator: Thank you. Next question is coming from Owen Lau from Clear Street. Your line is now live.

Speaker #4: Thank you. The next question is coming from Owen Lau at ClearStreet. Your line is now live.

Owen Lau: Hi. Good morning. Thank you for taking my question. Going back to the LLPA question, if there are eventually two different LLPA grids, how will this impact the back-end securitization part, how to harmonize the whole value chain, and also ultimately, how it would impact which score to use? Thank you.

Speaker #10: Hi, good morning. Thank you for taking my question. So going back to the LLPA question, if there are eventually 2 different LLPA grids, how will this impact the

Speaker #7: Like the backend securitization part—how do we harmonize the whole value chain, and also, ultimately, how will it impact which score to use? Thank you.

Mark Begor: Yeah. From our perspective, the credit score is not a big determinant in the capital markets. It is the underwriting that takes place by the mortgage originator and by the banks and financial institutions and agencies, whether it is Fannie, Freddie, or FHA. It is their underwriting process really supports the capital markets. That underwriting process that includes robust data, today, the TriMerge, in making sure that you got the complete picture on the consumer. That is what drives the capital markets. The change in the LLPA tables are important. The change that was made a few weeks ago by FHFA was important to really put on parity Vantage versus FICO. When they go to more custom LLPA tables, I do not think that has an impact on Vantage versus FICO. The real impact is going to be price.

Speaker #5: Yeah, you know, from our perspective, the credit score is not a big determinant in the capital markets. It's the underwriting that takes place, you know, by the mortgage originator.

Speaker #5: You know, and by the, you know, banks and financial institutions and agencies, you know, whether it's Fannie, Freddie, or FHA, it's their underwriting process really supports the capital markets.

Speaker #5: You know, that underwriting process that includes robust data, you know, today the tri-merge, you know, and making sure that you got the complete picture on the consumer, you know, that's what drives the capital markets.

Speaker #5: You know, the change in the LLPA tables, you know, are important. The change that was made a few weeks ago by FHFA, you know, was important to, you know, really, you know, put on parity, you know, Vantage versus FICO.

Speaker #5: You know, when they go to, you know, more custom LLPA tables, I don't think that has an impact on Vantage versus FICO. The real impact's going to be price.

Mark Begor: With the significant price advantage that Vantage has, it is going to be a score that the industry is going to want to use just because a lot of those PreQual loans do not move to application. That becomes a COGS form. At a dollar versus 10 plus, there is just meaningful savings. That is the billion dollars we talk about. In this environment, and likely an environment in 2027 where the mortgage industry is going to be challenged until rates come down, this kind of cost productivity for the mortgage industry is significant. So we think there is a lot of momentum around Vantage conversion as we move through the quarter and into next year.

Speaker #5: You know, and with the significant price advantage that Vantage has, you know, it's going to be a score that the industry is going to want to use just because you know, a lot of those, you know, prequal loans don't move to application and that becomes a COGS for them.

Speaker #5: And at $1 versus $10+, you know, there's just meaningful savings. That's the billion dollars we talk about. You know, and in this environment and likely an environment in '27 where the mortgage industry is going to be challenged until rates come down, you know, this kind of cost productivity for the mortgage industry is significant.

Speaker #5: So, you know, we think there's a lot of momentum around Vantage conversion as we move through the quarter and into next year.

Owen Lau: Got it. Then on the VantageScore adoption, can you please talk about the use cases of pulling both VantageScore and FICO at this point? I know many of them can get Vantage for free, but I think they cannot use two different scores for the same loan in originations. So how are lenders actually leveraging Vantage when they have FICO? Thank you.

Speaker #10: Got it. And then on the VantageScore adoption, can you please talk about the use cases of pulling both VantageScore and FICO at this point?

Speaker #10: I know, like, many of them can get VantageScore for free, but I think they cannot use two different scores for the same loan in originations.

Speaker #10: So how are lenders

Speaker #5: Actually leveraging VantageScore when they have FICO? Thank you. Yeah, remember that this was a massive change for the industry. For over 25 years, the only score that was used was one, which was the FICO score.

Mark Begor: Yeah. Remember, this was a massive change for the industry. For 25-plus years, the only score that was used was one, which was the FICO score. Their systems, their processes, think about the workflows that happen inside of a financial institution like a mortgage originator. Those all had to be changed and rebuilt to have the ability to absorb a second score and have it work through their process. That is why, last summer, when FHFA and Director Pulte announced that they were going to allow Vantage to be used in the Fannie and Freddie underwriting process, the industry had to start investing in technology changes and process flow changes in order to make that happen. That is a big project. It took a lot of time. It is substantially complete now.

Speaker #5: Their systems, their processes—think about the workflows that happen inside a financial institution like a mortgage originator—those all had to be changed and rebuilt.

Speaker #5: To have the ability to, you know, absorb a second score and have it work through their process. So that's why, you know, last summer, when FHFA and Director Polti announced that they were going to allow Vantage to be used in the Fannie and Freddie underwriting process, the industry had to start investing in technology changes and process flow changes in order to make that happen.

Speaker #5: That's a big project. It took a lot of time. It's substantially complete now, and that's why we made the decision last year to offer the free VantageScore with every paid FICO score, so our customers could start absorbing it, flowing it through.

Mark Begor: That is why we made the decision last year to offer the free VantageScore with every paid FICO score so our customers could start absorbing it, flowing it through. They could see the score difference on a consumer, which is very insignificant between Vantage and FICO, and also update their workflows so they could actually make that decision. That process is happening. As I said, we have 200 lenders that are understandably smaller lenders, but the big ones have built their processes, built their workflows, and everything we hear from them, they are going to start moving to the paid VantageScore to get that substantial cost savings versus the $10-plus FICO score going forward.

Speaker #5: They could see the score difference on a consumer, which is very insignificant between Vantage and FICO. And also work, you know, update their workflows so they could actually, you know, make that decision.

Speaker #5: And, you know, that process is, you know, happening. And as I said, we've got 200 lenders that, you know, are understandably smaller lenders, but the big ones, you know, have built their processes, built their workflows, and, you know, everything we hear from them you know, they're going to start moving to the paid VantageScore to get that substantial cost savings versus the $10+ FICO score going forward.

Mark Begor: We rolled out a new solution last week because we heard from lenders that they may want to, for example, pull the VantageScore first for $1, and then on certain consumers, they may decide, well, I am also going to pull the FICO score. They wanted to have a process to be able to do that. So we built that technology in order to bring that through. From my perspective and our perspective and what we know of the industry, that will be more an anomaly than the norm. Because remember, if you pull Vantage at a buck and then FICO at 10-plus, that is $11 you have got invested. If the $1 Vantage serves your purpose from a marketing standpoint, that is better for the consumer because they end up ultimately paying for it, and then it is also better for the lender because not every loan closes.

Speaker #5: We rolled out a new solution last week because we heard from lenders that they may want to, for example, pull the VantageScore first for $1, and then on certain consumers, they may decide, well, I'm also going to pull the FICO score. They wanted to have a process to be able to do that.

Speaker #5: You know, so we built that technology in order to bring that through. From my perspective and our perspective, what we know of the industry, that will be more an anomaly, you know, than the norm.

Speaker #5: That, uh, because remember, if you pull Vantage at $1 and then FICO at $10+, you know, that's $11 you've got invested. You know, if the $1 Vantage serves your purpose from a marketing standpoint, that's better for the consumer because they end up ultimately paying for it.

Speaker #5: And then it's also better for the lender, because not every loan closes. So, you know, there's just a huge advantage with the $1 VantageScore.

Mark Begor: There is just a huge advantage with the $1 VantageScore.

Operator 1: Thank you. Our final question today is coming from George Tong from Goldman Sachs. Your line is now live.

Operator: Thank you. Our final question today is coming from George Tong from Goldman Sachs. Your line is now live.

Speaker #4: Thank you. Our final question today is coming from George Tong from Goldman Sachs. Your line is now live.

George Tong: Hi. Thanks. Good morning. I wanted to go back to the government business. Beyond the $150 million of new state business already signed, you mentioned active discussions around the new Medicaid work requirements. Can you frame the potential incremental opportunity there and where those states are in the decision and contracting process?

Speaker #7: Hi, thanks. Good morning. I wanted to go back to the government business. Beyond the $150 million of new state business already signed, you mentioned active discussions around the new Medicaid work requirements.

Speaker #7: Can you frame the potential incremental opportunity there, and where those states are in the decision and contracting process?

Mark Begor: Yeah, it's a great question, George. It's not only the work requirements, it's the new SNAP requirements, where they have the error rate audit requirements from the federal government. If they're over the error rate, then they're going to have to start paying for some of the SNAP benefits going forward. So those are all changes that went in place a year ago July with OBBB that are driving new product rollouts by us, but also engagement by the states. As the federal government intended, they wanted to have more robust verification of income to try to bring down that $180 billion of improper payments. So that's a part of the pipeline going forward. As I said earlier in one of the questions, our core solutions. Again, as a reminder, I know you know this, George, because you know us well.

Speaker #5: Yeah, it's a great question, George, and it's not only the work requirements, it's the new SNAP requirements, you know, where they have the error rate, you know, audit requirements from the federal government.

Speaker #5: If they're over the error rate, then they're going to have to start paying for some of the SNAP benefits, you know, going forward. So those are all changes that went in place a year ago July with OB-3 that, you know, are driving kind of new product rollouts by us, but also you know, engagement, you know, by the states.

Speaker #5: And as the federal government intended, they wanted to have, you know, more robust verification of income to try to bring down that $180 billion of improper payments.

Speaker #5: So You know, that's a part of the pipeline, you know, going forward. And as I said earlier in one of the questions, you know, our kind of our core solutions, again, as a reminder, I know you know this, George, because you know us well.

Mark Begor: When you think about a $5 billion TAM, we're less than 20% of that today, meaning less than half of the states use us for Medicaid, less than half of the states use us for SNAP, less than half of the states use us for a lot of the other benefits. That white space which we think about as new customers and new states and new agencies we want to do business with, are doing their verifications principally manual today, and that's our opportunity. That's a big part of our pipeline. It always has been. So that hasn't changed with OBBB, and OBBB has just increased the commercial discussions, the frequency of them, the level of them. But the core value prop we have hasn't changed.

Speaker #5: You know, when you think about a $5 billion TAM, you know, we're less than 20% of that today. You know, meaning less than half of the states use us for Medicaid; less than half of the states use us for SNAP.

Speaker #5: You know, less than half of the states use us for a lot of the other benefits, that white space, you know, which we think about as new customers and new states and new agencies we want to do business with.

Speaker #5: You know, are doing their verifications principally manual today, and that's our opportunity, and that's a big part of our pipeline. It always has been, so that hasn't changed with OB-3, and it's just OB-3 has just increased the commercial discussions, the frequency of them, the level of them, but the core value prop we have, you know, hasn't changed, and it's really around delivering that you know, value of speed of social service delivery with an instant verification, the caseworker productivity that delivers from, you know, our solution, you know, versus doing it manually.

Mark Begor: And it is really around delivering that value of speed of social service delivery with an instant verification, the caseworker productivity that delivers from our solution versus doing it manually. Then, of course, the integrity that comes in using our verified data to make sure that the applicant should be receiving the benefits, or if they have the benefits, to make sure they should still be getting them. As you know, the $180 billion is a lot of opportunity for the federal government working through the states to reduce the cost of social services for those that currently do not qualify.

Speaker #5: And then of course the integrity that comes, you know, in using our verified data to make sure that, you know, the applicant, you know, should be receiving the benefits, or if they have the benefits.

Speaker #5: You know, to make sure they should still be getting them. And, you know, as you know, the $180 billion is a, you know, is a lot of opportunity, you know, for the federal government working through the states, you know, to, you know, reduce the cost.

Speaker #5: You know, of social services for those that, you know, currently don't qualify. Very helpful. Thank you.

George Tong: Very helpful. Thank you.

Operator 1: Thank you. We have reached the end of our question and answer session. I would like to turn the floor back over to Trevor for any further closing comments.

Operator: Thank you. We have reached the end of our question and answer session. I would like to turn the floor back over to Trevor for any further closing comments.

Speaker #4: Thank you. We've reached the end of our question and answer session. I'd like to turn the floor back over to Trevor for any further closing comments.

Mark Begor: Thanks for everybody's time today. If you have any follow-up questions, reach out to me and Molly, and we will be available. Thank you.

Speaker #9: Thanks for everybody's time today. If you have any follow-up questions, reach out to me or Molly, and we'll be available. Thank you.

Operator 1: Thank you. That does conclude today's teleconference webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.

Operator: Thank you. That does conclude today's teleconference webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.

Speaker #4: Thank you. That does conclude today's teleconference webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.

Operator 1: Everyone

Operator: Everyone