{"schemaVersion":1,"research":true,"symbol":"fds","name":"Factset Research Systems","topic":"moat","path":"/stock/fds/moat","status":"published","version":3,"updatedAt":"2026-10-18T14:49:45.324Z","locked":false,"publicFairValue":false,"fairValue":null,"moat":{"verdict":"narrow","summary":"FactSet has an evidenced narrow moat from integrated investment workflows and CGS's exclusive identifier-issuance role. ASV retention above 95% across the supplied periods supports persistent demand, and reported price increases demonstrate pricing power. Client retention softened to 90% in May 2026, while costs outgrew revenue. These results constrain resilience without establishing that the advantages have disappeared. Exceptional durability is not demonstrated.","advantages":[{"mechanism":"switching_costs","claim":"Integration with client applications and investment workflows creates operational switching friction. Consistently high ASV retention and expansion among existing clients support this inference, although migration costs are not quantified.","durability":"ASV retention exceeded 95% in fiscal 2024, fiscal 2025 and May 2026. Workflow integration supports continued dependency, conditional on competitive functionality and data quality.","risks":"Clients can reduce or terminate services with contractual notice. Client retention fell from 91% to 90% year over year in May 2026. AI-enabled alternatives and supplier consolidation could reduce workflow dependency; these disclosed risks are not demonstrated displacement.","invalidation":"Sustained ASV retention below the disclosed greater-than-95% range, accompanied by declining existing-client sales or repeated price concessions, would undermine the switching-cost thesis. Demonstrated low-cost migrations replacing integrated workflows would also invalidate it.","competitors":[],"evidenceIds":["e1","e2","e3","e4","e5","e6"],"counterEvidenceIds":["e7","e8","e9","e10"]},{"mechanism":"intangible_assets","claim":"CGS's exclusive global issuance of CUSIP and CINS identifiers provides a specific institutional advantage in identifiers used in critical security-master functions.","durability":"Exclusive issuance is disclosed in both fiscal 2024 and fiscal 2025. Industry reliance supports persistence, but the passages do not establish the duration, renewal protections or economics of the exclusive role.","risks":"Loss or modification of exclusivity, or reduced reliance on these identifiers, would weaken the advantage. CGS's contribution to consolidated earnings and its standalone pricing power are not established.","invalidation":"Termination or material dilution of exclusive issuance rights, or demonstrated migration of critical security-master functions to substitute identifiers that reduces CGS demand, would invalidate the advantage.","competitors":[],"evidenceIds":["e11","e12","e13"],"counterEvidenceIds":[]}],"evidence":[{"id":"e1","sourceId":"filing-1","location":"Business / Wealth integration","excerpt":"Our Wealth solution enables our clients to easily integrate our products into their CRM software and internally developed applications."},{"id":"e2","sourceId":"filing-5","location":"Business / client holdings and portfolio workflows","excerpt":"Additionally, our tools can integrate client holdings data with global market data to power our investment portfolio life cycle workflows."},{"id":"e3","sourceId":"filing-4","location":"Business / fiscal 2024 retention","excerpt":"For the year ended August 31, 2024, annual ASV retention was greater than 95% and, when expressed as a percentage of clients, annual retention was approximately 90%."},{"id":"e4","sourceId":"filing-1","location":"Business / fiscal 2025 retention","excerpt":"For the year ended August 31, 2025, annual ASV retention was greater than 95% and, when expressed as a percentage of clients, annual retention was 91%."},{"id":"e5","sourceId":"filing-2","location":"MD&A / May 2026 and May 2025 ASV retention","excerpt":"Annual ASV retention was greater than 95% of ASV as of May 31, 2026 and May 31, 2025."},{"id":"e6","sourceId":"filing-2","location":"MD&A / existing-client net sales","excerpt":"This increase is derived from higher net sales to existing clients and, to a lesser extent, sales to new clients."},{"id":"e7","sourceId":"filing-2","location":"MD&A / client retention","excerpt":"When expressed as a percentage of clients, annual retention was 90% and 91% as of May 31, 2026 and May 31, 2025, respectively."},{"id":"e8","sourceId":"filing-2","location":"MD&A / contractual service reductions and termination","excerpt":"With proper notice provided as contractually required, our clients can add to, delete portions of, or terminate service, subject to certain limitations."},{"id":"e9","sourceId":"filing-1","location":"Risk factors / technological substitution","excerpt":"The rapid pace of technological change, including advances in AI, cloud computing, and machine learning, along with evolving client demands, could cause our products and services to become outdated or less competitive."},{"id":"e10","sourceId":"filing-1","location":"Risk factors / supplier consolidation and self-sourcing","excerpt":"If our clients consolidate their spending with fewer suppliers, by selecting suppliers with lower-cost offerings or by self-sourcing their needs for financial market data, our business could be negatively affected."},{"id":"e11","sourceId":"filing-1","location":"Business / CGS exclusive issuance","excerpt":"CGS is the exclusive issuer of CUSIP and CINS identifiers globally."},{"id":"e12","sourceId":"filing-1","location":"Business / CGS security-master functions","excerpt":"The CUSIP Global Services (\"CGS\") business supports security master files relied on by the investment industry for critical front, middle and back-office functions."},{"id":"e13","sourceId":"filing-4","location":"Business / fiscal 2024 CGS exclusive issuance","excerpt":"CGS is the exclusive issuer of CUSIP and CINS identifiers globally."},{"id":"e14","sourceId":"filing-5","location":"MD&A / fiscal 2023 sales, price increases and cancellations","excerpt":"This increase was primarily driven by higher sales to existing clients and, to a lesser extent, price increases to existing clients and sales to new clients, partially offset by existing client cancellations."},{"id":"e15","sourceId":"filing-4","location":"MD&A / fiscal 2024 Asia Pacific demand and price increases","excerpt":"The increase in revenues was driven by higher demand and price increases primarily from workstations, data solutions and middle office solutions."},{"id":"e16","sourceId":"filing-1","location":"MD&A / fiscal 2025 organic ASV growth drivers","excerpt":"The increase in Organic ASV was primarily due to higher sales to existing clients and, to a lesser extent, sales to new clients and price increases to existing clients, all primarily attributable to workstations, data solutions and, to a lesser extent, CGS."},{"id":"e17","sourceId":"filing-1","location":"Financial statements / fiscal 2023–2025 segment results and capital expenditures","excerpt":"91 Table of Contents The following tables reflect the results of operations of our segments: (in thousands) Year Ended August 31, 2025 Americas EMEA Asia Pacific Total Revenues $ 1,506,108 $ 580,284 $ 235,356 $ 2,321,748 Operating expenses(1) 1,200,145 306,282 67,018 1,573,445 Operating income $ 305,963 $ 274,002 $ 168,338 $ 748,303 Total other income (expense), net (27,345) Income before income taxes $ 720,958 Other segment disclosures Depreciation and amortization $ 141,961 $ 7,857 $ 7,873 $ 157,691 Stock-based compensation $ 47,441 $ 9,182 $ 4,606 $ 61,229 Capital expenditures(2) $ 95,581 $ 5,924 $ 7,301 $ 108,806 Year Ended August 31, 2024 Americas EMEA Asia Pacific Total Revenues $ 1,419,901 $ 563,128 $ 220,027 $ 2,203,056 Operating expenses(1) 1,158,111 280,165 63,481 1,501,757 Operating income $ 261,790 $ 282,963 $ 156,546 $ 701,299 Total other income (expense), net (49,796) Income before income taxes $ 651,503 Other segment disclosures Depreciation and amortization $ 110,147 $ 7,171 $ 7,869 $ 125,187 Stock-based compensation $ 51,601 $ 8,007 $ 3,893 $ 63,501 Capital expenditures(2) $ 77,417 $ 3,835 $ 4,429 $ 85,681 Year Ended August 31, 2023 Americas EMEA Asia Pacific Total Revenues $ 1,335,484 $ 539,843 $ 210,181 $ 2,085,508 Operating expenses(1) 1,096,046 296,815 63,440 1,456,301 Operating income $ 239,438 $ 243,028 $ 146,741 $ 629,207 Total other income (expense), net (45,253) Income before income taxes $ 583,954 Other segment disclosures Depreciation and amortization $ 89,602 $ 7,305 $ 8,477 $ 105,384 Stock-based compensation $ 51,574 $ 7,280 $ 3,184 $ 62,038 Capital expenditures(2) $ 54,609 $ 2,317 $ 3,860 $ 60,786 (1)Operating expenses consist of Cost of services and SG&A costs."},{"id":"e18","sourceId":"filing-2","location":"MD&A / fiscal 2026 revenue, expense and earnings changes","excerpt":"The following table summarizes the results of operations for the periods presented: Three Months Ended Nine Months Ended May 31, % Change May 31, % Change (in thousands, except per share data) 2026 2025 2026 2025 Revenues $ 622,918 $ 585,520 6.4 % $ 1,841,558 $ 1,724,847 6.8 % Cost of services 312,190 280,729 11.2 % 896,848 809,112 10.8 % Selling, general and administrative 144,427 110,636 30.5 % 401,377 344,753 16.4 % Operating income $ 166,301 $ 194,155 (14.3) % $ 543,333 $ 570,982 (4.8) % Net income $ 126,718 $ 148,542 (14.7) % $ 412,354 $ 443,424 (7.0) % Diluted weighted average common shares 36,191 38,344 36,957 38,457 Diluted EPS $ 3.50 $ 3.87 (9.6) % $ 11.16 $ 11.53 (3.2) % Revenues Three months ended May 31, 2026 compared with three months ended May 31, 2025 The growth in revenues of 6.4% was driven by a 7.0% increase in organic revenues, which totaled $622.9 million for the three months ended May 31, 2026, partially offset by a 0.6% decrease in revenues due to the disposition of a business at the end of the prior fiscal year."},{"id":"e19","sourceId":"filing-2","location":"MD&A / cloud hosting and licensed software cost pressure","excerpt":"•Technology-related expenses increased by 50 basis points, primarily driven by higher spend in cloud-based hosting services and licensed software arrangements."},{"id":"e20","sourceId":"filing-2","location":"MD&A / expense recognition for CEO cash and equity awards","excerpt":"Variable compensation costs and stock-based compensation expense increased mainly due to the recognition, over their respective service periods, of the one-time cash awards and equity awards, respectively, granted to our CEO pursuant to the terms of his employment agreement."},{"id":"e21","sourceId":"filing-3","location":"Compensation discussion / fiscal 2025 operating cash generation","excerpt":"•Net cash provided by operating activities was $726.3 million for fiscal 2025."},{"id":"e22","sourceId":"filing-1","location":"Financial statements / equity issuance, repurchases and dividends","excerpt":"Consolidated Statements of Changes in Stockholders’ Equity (in thousands, except share data) Common Stock Additional Paid-in Capital Treasury Stock Retained Earnings Accumulated Other Comprehensive Loss Total Stockholders’ Equity Shares Par Value Shares Amount Balance as of August 31, 2022 41,653,218 $ 417 $ 1,190,350 3,608,462 $ (930,715) $ 1,179,739 $ (108,383) $ 1,331,408 Net income — — — — — 468,173 — 468,173 Other comprehensive income (loss) — — — — — — 21,242 21,242 Common stock issued for employee stock plans 360,375 3 72,003 410 (166) — — 71,840 Vesting of restricted stock 83,035 1 (1) 32,034 (13,544) — — (13,544) Excise tax on share repurchases — — — — (932) — — (932) Repurchases of common stock — — — 430,350 (176,720) — — (176,720) Stock-based compensation expense — — 62,038 — — — — 62,038 Dividends declared — — — — — (142,816) — (142,816) Other — — (759) — — — — (759) Balance as of August 31, 2023 42,096,628 $ 421 $ 1,323,631 4,071,256 $ (1,122,077) $ 1,505,096 $ (87,141) $ 1,619,930 Net income — — — — — 537,126 — 537,126 Other comprehensive income (loss) — — — — — — 7,528 7,528 Common stock issued for employee stock plans 407,542 4 91,708 831 (376) — — 91,336 Vesting of restricted stock 94,745 1 (1) 36,758 (16,283) — — (16,283) Excise tax on share repurchases — — — — (1,725) — — (1,725) Repurchases of common stock — — — 537,800 (235,235) — — (235,235) Stock-based compensation expense — — 63,501 — — — — 63,501 Dividends declared — — — — — (153,718) — (153,718) Balance as of August 31, 2024 42,598,915 $ 426 $ 1,478,839 4,646,645 $ (1,375,696) $ 1,888,504 $ (79,613) $ 1,912,460 Net income — — — — — 597,040 — 597,040 Other comprehensive income (loss) — — — — — — 15,865 15,865 Common stock issued for employee stock plans 325,030 3 81,686 370 (170) — — 81,519 Vesting of restricted stock 89,321 1 (1) 35,421 (16,072) — — (16,072) Excise tax on share repurchases — — — — (3,034) — — (3,034) Repurchases of common stock — — — 684,960 (300,457) — — (300,457) Stock-based compensation expense — — 61,229 — — — — 61,229 Dividends declared — — — — — (162,137) — (162,137) Balance as of August 31, 2025 43,013,266 $ 430 $ 1,621,753 5,367,396 $ (1,695,429) $ 2,323,407 $ (63,748) $ 2,186,413 The accompanying notes are an integral part of these Consolidated Financial Statements."},{"id":"e23","sourceId":"filing-2","location":"MD&A / nine-month fiscal 2026 repurchases and dividend payments","excerpt":"For the nine months ended May 31, 2026, net cash used in financing activities was $603.7 million, consisting mainly of $506.0 million of share repurchases and $122.7 million of dividend payments."},{"id":"e24","sourceId":"filing-2","location":"Financial statements / May 2026 cash, debt and outstanding shares","excerpt":"Consolidated Balance Sheets – Unaudited (in thousands, except share data) May 31, 2026 August 31, 2025 ASSETS Cash and cash equivalents $ 288,114 $ 337,651 Investments 16,122 17,445 Accounts receivable, net of reserves of $14,305 at May 31, 2026 and $13,789 at August 31, 2025 289,990 270,684 Prepaid taxes 58,325 33,600 Prepaid expenses and other current assets 74,968 70,379 Total current assets 727,519 729,759 Property, equipment and leasehold improvements, net 82,319 85,203 Goodwill 1,283,377 1,284,708 Intangible assets, net 1,868,418 1,916,102 Deferred tax assets 41,945 61,226 Lease right-of-use assets, net 119,364 121,776 Other assets 69,055 105,498 TOTAL ASSETS $ 4,191,997 $ 4,304,272 LIABILITIES Accounts payable and accrued expenses $ 163,982 $ 135,262 Current debt 499,159 — Current lease liabilities 33,963 33,145 Accrued compensation 137,431 130,596 Deferred revenues 183,494 167,852 Current taxes payable 5,182 13,041 Dividends payable 41,500 41,410 Total current liabilities 1,064,711 521,306 Long-term debt 890,542 1,368,260 Deferred tax liabilities 13,040 14,902 Taxes payable 41,315 45,095 Long-term lease liabilities 146,978 157,104 Other liabilities 3,121 11,192 TOTAL LIABILITIES $ 2,159,707 $ 2,117,859 Commitments and contingencies (see Note 11) STOCKHOLDERS’ EQUITY Preferred stock, $0.01 par value, 10,000,000 shares authorized, none issued $ — $ — Common stock, $0.01 par value; 150,000,000 shares authorized; 43,225,439 and 43,013,266 shares issued; 35,777,453 and 37,645,870 shares outstanding at May 31, 2026 and August 31, 2025, respectively 432 430 Additional paid-in capital 1,710,826 1,621,753 Treasury stock, at cost: 7,447,986 and 5,367,396 shares at May 31, 2026 and August 31, 2025, respectively (2,212,648) (1,695,429) Retained earnings 2,612,987 2,323,407 Accumulated other comprehensive loss (79,307) (63,748) TOTAL STOCKHOLDERS’ EQUITY $ 2,032,290 $ 2,186,413 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 4,191,997 $ 4,304,272 The accompanying notes are an integral part of these Consolidated Financial Statements."},{"id":"e25","sourceId":"filing-2","location":"MD&A / capital expenditures and investment-sale proceeds","excerpt":"The cash used in investing activities primarily consisted of $87.3 million of capital expenditures mainly due to the capitalization of internal-use software development costs, partially offset by $36.1 million in proceeds from the sale of certain equity investments."},{"id":"e26","sourceId":"filing-3","location":"Compensation discussion / FY23 PSU performance determination and scheduled vesting","excerpt":"Measure Weighting Threshold Performance Target Performance Max Performance Actual Performance Payout as a Percent of Target Adjusted Cumulative Revenues 50% $6,701 million $6,906 million $7,113 million $6,610 million — % Adjusted Cumulative Operating Earnings 50% $2,315 million $2,428 million $2,556 million $2,432 million 101.5 % Total Payout as Percentage of Target 50.8 % Following certification of FactSet’s performance against the performance goals for the FY23 PSUs during the 2023-2025 Performance Period, the NEOs listed below received the following PSUs, all of which are scheduled to vest and convert to shares on November 1, 2025."},{"id":"e27","sourceId":"filing-2","location":"Stock-based compensation / September 2025 CEO option grant","excerpt":"(2) Reflects a grant to our CEO on September 22, 2025 of PSOs as part of his May 28, 2025 employment agreement."},{"id":"e28","sourceId":"filing-2","location":"Stock-based compensation / CEO performance-option condition","excerpt":"The PSOs vest if, during the performance period ending on the fifth anniversary of the grant date, our common stock achieves a 30-day trailing volume-weighted average price (\"VWAP\") equal to or greater than 150% of the 30-day trailing VWAP ending on the grant date."},{"id":"e29","sourceId":"filing-2","location":"Stock-based compensation / CEO option exercise restriction","excerpt":"Options are not exercisable before the third anniversary of the grant date."},{"id":"e30","sourceId":"filing-3","location":"Compensation discussion / CEO replacement cash and equity awards","excerpt":"Viswanathan forfeited; •A one-time cash award of $10 million, the full gross amount of which is subject to repayment if he terminates employment with the Company without good reason or is terminated for cause before September 9, 2026; and •One-time make-whole equity grants consisting of (a) $26 million in restricted stock units that vest 25% each year over four years; and (b) $10 million in performance-based restricted stock units with a three-year performance period."},{"id":"e31","sourceId":"filing-3","location":"Proxy summary / board independence and stockholder rights","excerpt":"Board Structure and Independence Stockholder Rights •Independent Board Chair •All directors are independent, other than our CEO •Independent Committee Chairs •Fully independent Audit Committee, Compensation & Talent Committee, and Nominating & Corporate Governance Committee •Regularly held executive sessions •Annual election of directors beginning in 2025 •Proxy access rights •Stockholder director nominee recommendations •Majority voting for directors in uncontested elections •25% of stockholders have right to call a special meeting Board Composition & Refreshment Other Governance Practices •Highly skilled Board with balanced mix of expertise and qualifications •Annual Board and Committee evaluations •Strategic and proactive executive succession planning, culminating in appointment of new CEO •Strong track record of Board refreshment •Four new independent directors appointed since 2021 •Anti-hedging and pledging policy •Policy on public company board service •Annual risk assessment of executive compensation programs, policies and practices •Robust Code of Business Conduct and Ethics •Clawback policy •Stock ownership requirements for directors and executive officers For a detailed discussion of our Board of Directors, our corporate governance practices and our director nominees, please see \"Corporate Governance\" beginning on page 4 and \"Proposal 1: Election of Directors\" on page 22."},{"id":"e32","sourceId":"filing-3","location":"Compensation governance / existing clawback policy","excerpt":"•We have a clawback policy that covers both long-term and short-term incentive awards and also allows for recoupment of incentive awards and time-based equity compensation in the event of misconduct"},{"id":"e33","sourceId":"filing-1","location":"Internal controls / continuing IT general-control material weakness","excerpt":"Management’s Report on Internal Control Over Financial Reporting As previously reported in the Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2024, we had identified a material weakness in the design and operation of information technology (“IT”) general controls that support our revenues, accounts receivable, and deferred revenues processes which, in the aggregate, gave rise to a material weakness in internal control over financial reporting, which we are in the process of remediating."},{"id":"e34","sourceId":"filing-1","location":"Internal controls / ongoing remediation during fiscal 2025","excerpt":"Remediation Efforts During fiscal 2025, management made significant progress in enhancing the Company’s IT general controls to remediate the IT general control material weakness, however this effort remains ongoing."},{"id":"e35","sourceId":"filing-2","location":"MD&A / May 2026 client and user growth","excerpt":"35 Table of Contents Client and User Additions The table below presents our total clients and users: As of May 31, 2026 2025 Change Clients(1) 9,130 8,811 3.6 % Users 247,766 220,496 12.4 % (1)The client count includes clients with ASV of $10,000 and above."},{"id":"e36","sourceId":"filing-1","location":"Risk factors / intense competition across products and services","excerpt":"Strategy and Market Demand Risks Competition in our industry may cause price reductions or loss of market share, or limit our growth or profitability We continue to experience intense competition across all of our products and services, with competitors ranging in size from smaller, highly specialized, single-product businesses to multi-billion-dollar companies."},{"id":"e37","sourceId":"filing-3","location":"Compensation governance / existing stock ownership guidelines","excerpt":"Our Stock Ownership Guidelines require our non-employee directors (\"Covered Directors\") and certain of our senior executives (\"Covered Officers\"), including all of our NEOs, to maintain a material personal financial stake in FactSet to promote a long-term perspective in managing the enterprise and to align stockholder, executive and director interests."}],"changes":["Retains the previous narrow verdict: the supplied operating evidence continues to support workflow switching friction and CGS exclusivity.","Adds explicit pricing and management assessments. Actual CEO grants and determined PSU performance outcomes support an alignment assessment, while substantial replacement awards and the continuing fiscal 2025 control weakness constrain management quality.","Clarifies that the latest fiscal 2026 evidence covers the nine months ended May 31, rather than a completed fiscal year, and that the client-retention decline is a year-over-year May comparison."],"limitations":["All evidence comes from issuer filings. Operating results and contractual disclosures support numerical assessments, but statements about competitive benefits and future AI capabilities are not independent demonstrations of superiority.","The competition passages identify generic categories rather than named competitors. Companies mentioned as compensation peers, acquired businesses or executive affiliations are not established competitors; competitor arrays are therefore empty.","Switching costs are inferred from disclosed integrations, retention and existing-client expansion. Migration expense, implementation time, competitive win rates and customer-level alternatives are absent.","CGS exclusivity is disclosed, but its contractual duration, renewal conditions, standalone returns and contribution to consolidated pricing power are missing. Identifier adoption alone does not establish a separately evidenced network effect.","Price increases are reported without their magnitude, discounting, elasticity or a separate fiscal 2026 pricing contribution. Client cancellation rights are disclosed, but supplier repricing rights and escalation clauses are not.","Actual executive ownership balances and compliance with ownership guidelines are not supplied. Proposed proxy resolutions are not treated as adopted, and scheduled November 2025 PSU vesting is not treated as verified completed vesting.","The supplied passages establish a material control weakness still being remediated in fiscal 2025; they do not establish its subsequent resolution or continued existence as of May 2026.","Source dates are filing dates, retaining dateKind filed: fiscal 2025 10-K filed October 22, 2025; proxy filed October 27, 2025; latest supplied 10-Q filed July 1, 2026. No later operating period is inferred."],"qualityAssessments":[{"category":"moat","checks":[{"criterion":"structural_advantage","grade":3,"rationale":"Integrated client workflows and CGS's specific exclusive issuance role establish current structural advantages. High ASV retention corroborates demand persistence; breadth or margins alone do not establish the moat.","evidenceIds":["e1","e2","e5","e11","e12"]},{"criterion":"durability","grade":2,"rationale":"Repeated greater-than-95% ASV retention and repeated exclusivity disclosures support persistence. Missing exclusivity terms, unquantified migration friction and technological substitution exposure prevent a stronger long-term durability finding.","evidenceIds":["e3","e4","e5","e9","e11","e13"]},{"criterion":"customer_dependency","grade":3,"rationale":"Portfolio-data integration, existing-client expansion and high ASV retention demonstrate substantial repeat demand consistent with operational dependency. The specific switching burden remains inferred, and 90% client retention shows that dependency is not universal.","evidenceIds":["e2","e5","e6","e7"]},{"criterion":"erosion_resilience","grade":2,"rationale":"ASV retention and existing-client expansion remain resilient amid disclosed intense competition. Softer client retention and fiscal 2026 cost pressure make the evidence mixed. AI substitution is a risk rather than demonstrated displacement.","evidenceIds":["e5","e6","e7","e9","e18","e36"]}]},{"category":"pricing_power","checks":[{"criterion":"realized_pricing","grade":3,"rationale":"Reported price increases contributed to fiscal 2023 revenue growth, fiscal 2024 Asia Pacific growth and fiscal 2025 ASV growth. These are realized outcomes, although their magnitude and fiscal 2026 continuation are not separately established.","evidenceIds":["e14","e15","e16"]},{"criterion":"retention","grade":3,"rationale":"Directly reported ASV retention remained above 95% across fiscal 2024, fiscal 2025 and May 2026. Client retention of 90% in May 2026, down from 91%, tempers this strong repeat-demand evidence.","evidenceIds":["e3","e4","e5","e7"]},{"criterion":"margin_resilience","grade":2,"rationale":"Fiscal 2023–2025 operating results improved, but nine-month fiscal 2026 operating income fell 4.8% despite 6.8% revenue growth. Hosting, software and CEO award expenses contributed to pressure. This establishes mixed cost absorption, not proof of competitive price erosion.","evidenceIds":["e17","e18","e19","e20"]},{"criterion":"contractual_freedom","grade":2,"rationale":"Realized price increases demonstrate practical ability to obtain higher prices, while contractual notice permits clients to reduce or terminate services subject to limitations. This supports mixed commercial freedom; unilateral repricing rights, renewal timing and escalation clauses remain undisclosed.","evidenceIds":["e8","e14","e16"]}]},{"category":"strong_management","checks":[{"criterion":"capital_discipline","grade":2,"rationale":"Fiscal 2025 operating cash generation of $726.3 million supported investment and shareholder distributions, and repurchases reduced shares outstanding. Fiscal 2026 repurchases of $506.0 million plus dividends and higher capital spending accompanied lower cash and slightly higher total debt. Acquisition returns and repurchase value creation are unproven, making discipline mixed.","evidenceIds":["e17","e21","e22","e23","e24","e25"]},{"criterion":"incentive_alignment","grade":2,"rationale":"The actual September 2025 CEO option grant has a five-year performance condition and three-year exercise restriction. FY23 PSU performance was determined at 50.8% of target after the revenue component missed threshold, demonstrating payout sensitivity. Large replacement cash and time-vesting awards dilute alignment; actual ownership and completed vesting are not established.","evidenceIds":["e26","e27","e28","e29","e30","e37"]},{"criterion":"execution","grade":2,"rationale":"Reported client and user growth, high ASV retention and existing-client expansion demonstrate commercial execution. Fiscal 2026 operating-income decline and the FY23 PSU revenue-threshold miss counterbalance those achievements. Operating results provide indirect evidence of management execution rather than causal proof of individual leadership quality.","evidenceIds":["e5","e6","e18","e26","e35"]},{"criterion":"governance","grade":2,"rationale":"An independent chair, independent committees, stockholder rights and an existing clawback policy support governance. The fiscal 2025 continuation of a previously identified IT control material weakness is actual adverse evidence. Ongoing remediation does not establish resolution, and proposed charter changes are not credited as adopted.","evidenceIds":["e31","e32","e33","e34"]}]}],"financialAssessments":[],"qualityPolicy":"quality-scores-2","sourcePolicy":"issuer-evidence-4","basisHash":"a30c80a43c72527c9c899766d6412feaceedd5384cbf18399bdade515415a89a","updatedAt":"2026-10-18T14:49:45.324Z","sources":[{"id":"filing-1","url":"https://www.sec.gov/Archives/edgar/data/1013237/000162828025045769/fds-20250831.htm","publishedAt":"2025-10-22","sha256":"639a1c012642637dc0c66a1f4b4ebb6ec7703577eddd6767e9b460f5e8e7883e","dateKind":"filed"},{"id":"filing-2","url":"https://www.sec.gov/Archives/edgar/data/1013237/000162828026046549/fds-20260531.htm","publishedAt":"2026-07-01","sha256":"b443bd08fa4265213b83081eafd5e865dbcd3d6d380fc05f6c511cca577e7ca9","dateKind":"filed"},{"id":"filing-3","url":"https://www.sec.gov/Archives/edgar/data/1013237/000162828025046442/fds-20251027.htm","publishedAt":"2025-10-27","sha256":"5289666c02f11783cfc9d6bd9839b2684bb85673cc3e77cd22a4fc97cdb3fcb3","dateKind":"filed"},{"id":"filing-4","url":"https://www.sec.gov/Archives/edgar/data/1013237/000101323724000141/fds-20240831.htm","publishedAt":"2024-10-29","sha256":"86b4c60e572f408f5944c107d114076472b631fae6335cfba306e77777cea22e","dateKind":"filed"},{"id":"filing-5","url":"https://www.sec.gov/Archives/edgar/data/1013237/000101323723000128/fds-20230831.htm","publishedAt":"2023-10-27","sha256":"b6ec64fb687fba858f75f12541a5f16c2e3da5eafe28cce07efba4fac6fd8720","dateKind":"filed"},{"id":"filing-6","url":"https://www.sec.gov/Archives/edgar/data/1013237/000162828026022873/fds-20260228.htm","publishedAt":"2026-04-02","sha256":"15d33f13fdb6b6eb36508b13b48ecbc7bca0a7477e5e97185002f477eb67c42c","dateKind":"filed"}],"model":"gpt-6.1-sol","providerId":"codex:265cd980c79e4684944398d80f29277bbe2de55293b9870271b4176cf482db6e","usage":{"input_tokens":92877,"cached_input_tokens":0,"cache_write_input_tokens":0,"output_tokens":4206,"reasoning_output_tokens":119}},"signals":[{"period":"2021","end":"2021-08-31","values":{"gross_margin":50.58578838728326,"operating_margin":29.786828951047635,"roic":45.15566036365955,"fcf_margin":31.034751436587506,"sbc_revenue":2.8317032633864194},"issues":{"software_capex":"Separately disclosed software and intangible investment is unavailable in the extracted statements for this period.","roic_wacc":"Enter a WACC assumption from 0 to 100%."}},{"period":"2022","end":"2022-08-31","values":{"gross_margin":52.757211376805145,"operating_margin":25.786868211370294,"roic":22.876204801633847,"fcf_margin":26.41808739340482,"sbc_revenue":3.0372169302757426},"issues":{"peg":"TTM earnings per diluted share growth is zero or negative; a growth-adjusted multiple requires positive growth.","pfcf_growth":"TTM FCF per diluted share growth is zero or negative; a growth-adjusted multiple requires positive growth.","software_capex":"Separately disclosed software and intangible investment is unavailable in the extracted statements for this period.","roic_wacc":"Enter a WACC assumption from 0 to 100%."}},{"period":"2023","end":"2023-08-31","values":{"gross_margin":53.333911929371645,"operating_margin":30.17044288489903,"roic":17.95929340189135,"fcf_margin":28.040506198010274,"sbc_revenue":2.974718869455308},"issues":{"software_capex":"Separately disclosed software and intangible investment is unavailable in the extracted statements for this period.","roiic":"Invested capital did not increase versus the prior year. ROIIC requires a positive increase.","roic_wacc":"Enter a WACC assumption from 0 to 100%."}},{"period":"2024","end":"2024-08-31","values":{"gross_margin":54.06630607664988,"operating_margin":31.83300833024671,"roic":20.42085954545989,"fcf_margin":27.900198633171374,"sbc_revenue":2.8824051680937752},"issues":{"software_capex":"Separately disclosed software and intangible investment is unavailable in the extracted statements for this period.","roic_wacc":"Enter a WACC assumption from 0 to 100%."}},{"period":"2025","end":"2025-08-31","values":{"gross_margin":52.71743531167034,"operating_margin":32.23015589977896,"roic":20.409630315571704,"fcf_margin":26.59435907772936,"sbc_revenue":2.6371940451763067},"issues":{"software_capex":"Separately disclosed software and intangible investment is unavailable in the extracted statements for this period.","roic_wacc":"Enter a WACC assumption from 0 to 100%."}}],"sources":[{"id":"filing-1","url":"https://www.sec.gov/Archives/edgar/data/1013237/000162828025045769/fds-20250831.htm","publishedAt":"2025-10-22","sha256":"639a1c012642637dc0c66a1f4b4ebb6ec7703577eddd6767e9b460f5e8e7883e","dateKind":"filed"},{"id":"filing-2","url":"https://www.sec.gov/Archives/edgar/data/1013237/000162828026046549/fds-20260531.htm","publishedAt":"2026-07-01","sha256":"b443bd08fa4265213b83081eafd5e865dbcd3d6d380fc05f6c511cca577e7ca9","dateKind":"filed"},{"id":"filing-3","url":"https://www.sec.gov/Archives/edgar/data/1013237/000162828025046442/fds-20251027.htm","publishedAt":"2025-10-27","sha256":"5289666c02f11783cfc9d6bd9839b2684bb85673cc3e77cd22a4fc97cdb3fcb3","dateKind":"filed"},{"id":"filing-4","url":"https://www.sec.gov/Archives/edgar/data/1013237/000101323724000141/fds-20240831.htm","publishedAt":"2024-10-29","sha256":"86b4c60e572f408f5944c107d114076472b631fae6335cfba306e77777cea22e","dateKind":"filed"},{"id":"filing-5","url":"https://www.sec.gov/Archives/edgar/data/1013237/000101323723000128/fds-20230831.htm","publishedAt":"2023-10-27","sha256":"b6ec64fb687fba858f75f12541a5f16c2e3da5eafe28cce07efba4fac6fd8720","dateKind":"filed"},{"id":"filing-6","url":"https://www.sec.gov/Archives/edgar/data/1013237/000162828026022873/fds-20260228.htm","publishedAt":"2026-04-02","sha256":"15d33f13fdb6b6eb36508b13b48ecbc7bca0a7477e5e97185002f477eb67c42c","dateKind":"filed"}],"history":[{"version":3,"updatedAt":"2026-10-18T16:35:43.872Z","verdict":"narrow","value":null},{"version":2,"updatedAt":"2026-10-18T02:27:49.793Z","verdict":"narrow","value":null},{"version":1,"updatedAt":"2026-10-18T02:18:02.026Z","verdict":null,"value":null}],"hasRequested":false,"requestStatus":"completed","researchIssue":null,"archivedMoat":null,"scope":"supported_catalog"}