Q124 EFX earnings

earnings summary

Earnings Results: • Strong start to the year, with revenue of $1.32 billion, up 4% on a reported basis and 5% in constant currency • Adjusted EPS of $1.56, above the high end of guidance • USIS revenue up 4% despite U.S. mortgage market inquiries being down 26% • Workforce Solutions revenue up 15%, driven by strong growth in non-mortgage verticals • International revenue up 3% on a reported basis and 11% in local currency

Future Guidance: • Full year 2023 guidance maintained, with revenue at the high end of $5.25-5.35 billion range • Adjusted EPS expected to be at the high end or above $7.20-7.50 range • Mortgage market inquiries expected to be down 20% for the full year • Non-mortgage revenue expected to grow high single digits, above long-term framework of 6-8% • Continued progress expected towards completing cloud transformation by end of 2023

Equifax delivered strong results in Q1 2024, exceeding expectations on both the top and bottom line despite ongoing weakness in the U.S. mortgage market. The company saw broad-based strength across its business units, with notable outperformance in Workforce Solutions driven by robust growth in government and talent solutions. USIS also performed well, with non-mortgage verticals like banking, auto, telco and consumer credit showing resilience.

Looking ahead, Equifax maintained its full year guidance and expressed confidence in delivering results at the high end or above the previously provided ranges. The mortgage market is expected to remain subdued, with inquiries forecast to be down 20% in 2023. However, the company believes its non-mortgage businesses will continue to grow above the long-term framework of 6-8%.

Equifax also highlighted its progress towards completing its cloud transformation by the end of 2023. This milestone is expected to drive increased innovation, product rollouts and margin expansion in the years ahead. The company is leveraging its cloud capabilities, along with differentiated data, AI and ML investments to introduce new products and drive growth.

While there are some signs of weakness in the broader economy, such as slower hiring in blue-collar roles and softness in marketing spend from some financial institutions, overall sentiment remains positive. Equifax is seeing resiliency in consumer credit quality and expects its non-mortgage verticals to continue performing well.

Notable quotes: “We’re making strong progress towards completing our cloud transformation, which will allow us to accelerate new product innovation and drive margin expansion over the coming years.” - Mark Begor, CEO

”Our non-mortgage businesses continue to perform very well, and we expect them to deliver growth above our long-term framework of 6-8% in 2023.” - John Gamble, CFO

”While there are some signs of weakness in the economy, we’re seeing overall stability in terms of consumer credit and employment, and our strong performance in the first quarter gives us confidence in our ability to deliver for the full year.” - Mark Begor, CEO