Key Highlights

● Fourth-quarter revenue was $634.7 million, up 6.3%, with organic revenue up 7.1%.

● Adjusted diluted EPS was $4.52, up 11.6%, against an analyst estimate of $4.35.

● Fiscal 2027 adjusted diluted EPS guidance is $19.25 to $19.65.

● FactSet marked its 27th consecutive year of dividend increases.

FactSet Research Systems (NYSE:FDS) reported fiscal fourth-quarter and full-year 2026 results on September 30, and the share price reaction centered less on the quarter than on what came next. Fiscal 2027 guidance landed slightly below analyst consensus at the midpoint, even though the quarter itself beat estimates.

Latest Company Context

For the fourth quarter ended August 31, 2026, FactSet reported revenue of $634.7 million, up 6.3%, with organic revenue up 7.1%. Adjusted diluted EPS was $4.52, up 11.6%, against a reported analyst estimate of $4.35. Organic annual subscription value (ASV) was $2,568.2 million, up 7.0%. For fiscal 2026, revenue was $2.48 billion, up 6.7%, and adjusted diluted EPS was $18.01, up 6.1%. The company said annual ASV retention was above 95% and that ASV added from AI solutions more than doubled versus the prior year. It marked its 27th consecutive year of dividend increases.

Key Business and Index Drivers

Fiscal 2027 guidance calls for organic ASV growth of 5.0% to 6.5%, revenue of $2,600 million to $2,625 million, adjusted operating margin of 34.75% to 35.25%, and adjusted diluted EPS of $19.25 to $19.65. Coverage of the release put the consensus at roughly $19.72 for adjusted EPS and $2.62 billion for revenue, so the midpoint of the EPS range, $19.45, sat slightly under it. Shares were reported down roughly 3.5% in pre-market trading on the day.

Guided organic ASV growth of 5.0% to 6.5% compares with the 7.0% just delivered, suggesting management is planning for some moderation. The fourth-quarter adjusted operating margin of 33.0% was lower than 33.8% a year earlier, which the company linked mainly to higher compensation tied to ASV-linked incentive plans and technology costs. FactSet joined the S&P 500 in December 2021, which can make it part of index-tracking portfolios.

For context, the guided adjusted operating margin of 34.75% to 35.25% compares with the fiscal 2026 adjusted margin of 34.5%, so management is planning for modest improvement rather than a step change. Consensus can shift quickly after results, and analysts may revise estimates in the weeks that follow.

What Investors Should Watch

● ASV trajectory: Quarterly ASV updates will show whether growth tracks toward the guided range or runs ahead of it.

● AI contribution: The company highlighted a doubling of ASV from AI solutions, and further disclosure could clarify how material that is becoming.

● Margin path: Investors may watch whether the compensation and technology cost pressure seen in the fourth quarter persists or eases.

● Capital return: FactSet repurchased $138.0 million of shares in the quarter at an average price of $249.90, with $356.0 million remaining under its program as of August 31.

● Next quarterly report: The first-quarter fiscal 2027 update, which the company has not yet scheduled, will be the next test of the guidance.

Solid Results, Measured Guidance

The distance between FactSet's guidance and consensus is small in absolute terms, which suggests the reaction reflected sensitivity to any shortfall rather than a dramatic change in outlook. Results were solid, retention remained high and AI-related demand was growing, while margin and growth guidance implied a measured year.