Fair Isaac Corp (FICO) May 5, 2026 Conference Transcript

All right, good afternoon, everybody. Thank you for being here. We're happy to continue our session here with FICO. We have CEO Will Lansing and CFO Steve Weber. So thank you both for being here. Well, maybe I guess let's take a step back. I think there are some newer investors in the space now. Obviously, your stock has been under some pressure for a while.

So maybe from your perspective, what is the the FICO pitch today from your perspective because you guys keep obviously buying back shares every every opportunity you get yeah well I guess just on that point we're kind of a slow-moving LBO we have been buying back our stock for a very long time we started at 74 million shares and when I joined the board we were at 36 million shares when I became CEO in 2012 we were 30 million shares today we're at 23 million shares so what we do is we take our cash flow and we we buy back stock and lever up and our cash flow grows and then we buy back some more stock and lever up a little bit more and trying to trying to keep the leverage up and kind of a two to three times range so that's the capital side of the equation and then the business has just gotten stronger and stronger and stronger for well certainly for the last 14 years and we see a pretty bright future we're a little surprised at where the stock prices frankly you know we're kind of trading at multiples that surprise us and maybe it's just worth going back in time and giving you a little bit of the FICO story sure so so you kind of have a level set on where we are but I guess before I do that I would I'd remind you take a look at the charts you know we had well over a decade of kind of rocketing to top decile performance on TSR. And then in the last 15 months, we've been pretty beat up, mostly because of fear about some political things going on in Washington and our mortgage business. So I'm sure we'll spend more time on that. But again, by way of context, just maybe a few minutes on FICO history and how we got here. Well, actually, just a show of hands, how many of you guys know the story, the FICO story? You guys know nothing about us. Okay, that's fine. So this is a good place to start. The company was founded in 1956 by a mathematician and an engineer. And the idea was, let's apply analytics to data and make better decisions. And so for 30 or 40 years, that was the business. It was a consulting business, a body business of doing that. We built scorecards, proprietary scorecards for banks. Because banks had big money decisions, it was worth taking the time to invest in a better decision. that went on in the 1970s we got this idea that maybe we should try to build a software business too because if we have software if we embody this the analytics and software we'll be able to get returns to scale make money while we sleep we won't just be a body business so we started a software business we took the half dozen questions that banks asked us most frequently and we built applications around them. So originations, should we or should we not make this loan? Customer management, line management, should we increase this person's credit card line? Should we decrease it? If we increase it, should we decrease something else, some other risk somewhere else? Fraud, fraud detection, collections and recovery. So these were the big areas where we had applications. And we built a really substantial software business through the 80s, 90s, 2000, and on, around these franchises. I took over in 2012, and we made some changes. On the software side, we went to a cloud model from an on-premise model, and then we also put a lot of energy into building out the technology stack so that we're not just an applications business anymore. We are a decisioning platform. We're a true platform. and it took a lot of years to achieve that success but that's kind of where we are now we'll spend more time on it if we have time at the end on the score side in 1987 we decided instead of building proprietary scorecards for each bank what we would do is build a generic scorecard that could be used by by any bank they just show up they don't have to give us any special parameters we did that in partnership with Equifax and it was wildly successful you know we kind of made this thing that made it super easy for lenders to evaluate credit low cost evaluation of credit and this is also you know in response to the fair lending laws that want you to demonstrate that there's no discrimination in the way you do your underwriting and scores are completely clean and science-based then we had this idea that we should build the same kind of a score with the other bureaus. So in the U.S. there are three bureaus, Equifax, Experian, and TransUnion are the big three. And so we went and built scores with Experian and with TransUnion as well as with Equifax. And what we did was we aligned the odds to score ratio across all three bureaus the same. So what that did was effectively say a FICO score is a FICO score regardless of where you get your data, regardless of which bureau you use. You can imagine how popular that was with the lenders i mean it commoditized the data at some level and it gave them a lot of leverage versus the the data providers because they could easily switch from one one provide one bureau to another so pretty popular that went on and um you know we had the lenders liking it regulators got into it they thought that it was pretty useful for them because they could measure the risk of the banks that they're regulating what's the average fico score of the portfolio how will behave in a downturn and then the security securitization market evolved and they needed a metric for pricing the risk and the most obvious one was FICO and so pretty much all your asset-backed securities your mortgage-backed securities all come with an average weighted FICO score so that people actually know what the what the paper's worth and so now you've got lenders you got regulators you got the securities market the investors in the securities market and then finally we got consumers on board we give them their score for free and so there's a lot of demand pull for FICO scores so that's that's the that's how scores got to be the industry standard that they are and kind of positioned us where we are another wrinkle starting in about a decade ago we started raising prices for scores why did we do that well for 30 years we didn't raise prices for scores because our pricing was hardwired into our contracts with the bureaus we distribute our scores through the bureaus and so the prices were all fixed and we never changed them and you should just talk to my predecessors about why and I decided we should have the flexibility to change our pricing and 30 years is too long to go without a price increase and so we started changing our prices about a decade ago and so every year we're in the business of trying to capture some of the value that's been left behind I mean that's really that the story of fico is we have a mountain of ip that has been under managed and under monetized for decades and we're in the process of figuring out how do you monetize that with the least amount of disruption to markets with the um with you know with in in a steady and continuous way march up the value you know march up the optimum the monetization of the value and so that's what we've been doing in mortgage in particular we've raised prices if you read the you know the bad press that they focus on the percentage increases that we've raised prices and it's true we've raised prices from five cents years ago to ten dollars today but remember that's ten dollars out of six thousand dollars of closing costs so it's still kind of a trivial number in scheme of things but what's happened is it turned into a headline our mortgage price increases turned into a headline for the populists in Washington and in particular for the director of the FHFA who who's very pro-competition very focused on how do I you know make housing more affordable in the US one of the things he's looking at is closing costs and so among other things you know he's questioned our pricing. And I think that we've actually responded by coming out with some new pricing models, some innovation that I think he likes, where we have an option to buy mortgage scores from FICO for 99 cents. So that's a big step in the direction that I think he was looking for. But I would say the noise in our stock is almost entirely tied to that. There might be a a little bit of spillover from the AI software scare, but I think that's pretty minor. We never got much credit for software before, so I don't know how much we should get bashed for it now. We are very happy with the software business. Grew 49% last quarter in our new platform, so strong business. So anyway, that's the background.

All right, helpful. We'll get into some of the noise, but maybe, Steve, you can help here. But with that history, with the current context around pricing and mortgage and so forth. Is there a long-term algorithm, financial algorithm, that the audience should keep in mind, whether revenue, EPS?

Yeah, I mean, we don't have any issued numbers. But if you look at our past, you can kind of see that we've been pretty consistent. So we do target internally. We want to maintain the same pace that we've done in the past. So we try to get in at least into the teens of revenue growth which could drive us into the 20 plus percent with you know margin expansion in the net income and then a lot of times that can be above 30% with EPS with the buyback so just rough justice that's how we've been looking at it and that's you know as we make plans for the coming year that's what we try to target going forward got it okay well let's jump into the the mortgage market and the political knowledge you were referring to so you know we just had MSCI before you we had S&P in the morning you know those indices there's a lot of competition but once you're the benchmark of the benchmark we described it FICO is the benchmark obviously director Pulte has implemented a lenders

choice allowed or in the process of allowing Vantage score to come in you know from your perspective how do you see the potential shifts in the market if and when they are approved well we'll see if Vantage gets any share at all I mean we've been competing with Vantage for over 20 years in every other market outside mortgage and they have no share they push a lot of scores and the way they do that is by sending them along for free so if a lender asks for asks a bureau for a credit file on a FICO score they'll often get the vantage score sent along for free and that's that's where the big numbers come from but I I'm not exactly sure that should be considered market share because nobody asked for it and nobody paid for it. In mortgage remains to be seen whether having an option for a Vantage score gets you anywhere. I would say that the value proposition is still pretty thin. So why would someone buy a Vantage score? If they're buying it because they're interested in credit default risk and predictiveness, and certainly the entire non-conforming market cares about credit default risk, and I would say that the conforming market also cares about credit default risk because it comes back to haunt them. If the loans go bad, a lot of those loans are put back by the GSEs to the originators. So they also care about credit default risk. If that's what you care about, FICO 10T is 8% more predictive than Vantage 4, and FICO 10T qualifies 5% more borrowers than Vantage 4. So predictiveness is not going to get you there from a value proposition standpoint so then you say well what about on price you know maybe somebody cares about price and even though we're talking about a very small price in the scheme of things is there someone who cares and on that I'd say our new pricing model at 99 cents meets vantage score pricing at 99 cents so I don't think there's a reason to move for price so that leaves you with one and only one reason to buy a vantage score and that's if you're trying to gain the GSEs and And that's real. That's not, you know, that's not hypothetical. I mean, any time you have a two-score system, one score is always better than the other. So when you, typically, you would give a better price to the better score. So if Fannie and Freddie are constantly being presented with the better of two scores, they're being gamed. And frankly, what will occur in the long run, if anybody does this gaming, What occurs in the long run is that the non-conforming market, the lenders in the non-conforming market will skim off the best credits out of the conforming market and leave the GSEs with the inferior credits, which will cost Fannie and Freddie quite a lot. That is the likely outcome of gaming. But I would caution you just by saying that the addressable market for gaming is fairly limited. It's under 10%. So, you know, if you look at the rules that came out last week, which are you need less than 80% loan-to-value, meaning you have to put down 20% or you can't get the mortgage. So for Vantage, you need less than 80% loan-to-value. And you need, there's not actually a separate Vantage LLPA grid. That's the pricing grid. There's not a separate one for Vantage. What they did was they said, take a Vantage score, subtract 20 points, and jam it into a FICO, LLPA grid, which is suspect science. But anyway, that's what they've done. And if you work through all the math on it, and I'll spare you guys the math today, it takes you to about a 9% addressable market.

And I guess just to be clear, even the gaming, in order to game, don't you just have to pull both scores all the time?

Well, yeah, great point. So there's no volume loss. So if you have to pull both scores in order to compare them to do the gaming, our volume doesn't go down. You're still pulling a FICO score. But the overall market of scores volume went up a little bit. So, yeah, we could have, technically we could have share loss, but no volume loss. That's theoretically possible. And then, you know, the 99 cents, yes, you've matched kind of the upfront pull fee, but in the performance model, you do have the $65 closing fee per report. so how do you think the lenders or each market will address that when they're trying to compare whether they want to save money or not well you know that's that's money that's paid by the consumer now ultimately of course consumers pay for everything we know that so it's really about kind of what bucket you put it in but you know the industry has always tried to push cost to the closing statement and out of their own P&Ls and that's why we have RESPA laws the The respite laws are designed to keep that from happening, really, to ensure that the only costs that go into a closing are appropriate costs that have something to do with the closing. And to that extent, what we've done is match them perfectly. There's nothing that's closer to what the closing's all about than you got your mortgage successful funding fee. So I think that we're actually helping the lenders with this. In terms of their true cost to themselves, it's identical, whether they're paying $0.99 to Vantage or $0.99 to FICO.

And in order to get that $0.99 to FICO, they have to go through the direct, the DLP model. Through you guys. It seems like it's been a case of going to be ready in the next month for a few months now. So what's the latest on when the DLP will be out there?

It's going to be ready in the next month. Well, I mean, it shouldn't take that much longer. We're waiting on certification from the GSEs. They're supportive. The director's supportive. It's a matter of time.

And in all that you described on the lenders, 1, 10T, 99 cents takes care of the costs, once DLP is live, how fast and how much adoption should we be looking out for?

Well, no one really knows, but I think that there's a lot of demand for the performance model, which will only be available through the tri-merge resellers, through the DLP model. And our economic analysis says roughly half the market would prefer the performance model over the per-score model. And the tri-merge resellers have, by far, the lion's share of the market. Almost all the scores are purchased, ultimately, through the tri-merge resellers. So it could easily be half. It could get to half, certainly within a year.

Got it. And I think it's probably worth spending a little bit of time on the 10T independent study that was put out recently because I think Vantisco obviously claims to be better than the FICO Classic, which might make sense because it was developed so many years later. But can you just talk about this was a second iteration of the independent study, I believe. So what changed and what are some of the stats again on why 10T is much better?

So I would encourage people to go to the FICO website and read our white paper on it. And you can go to Millman, which is the independent third party that did the analysis, and read theirs. It's quite technical. But they've done a scientifically rigorous assessment of 10T versus Vantage 4. And we are better on predictiveness. They actually go through the gaming issues with a two-score system and identify the costs around that. So, I mean, it's worth a read, but it's quite technical. There's probably other things you'll read before you read that. Just take my word for it. If I go to any of that, I'll banish for it.

You know, the FHFA had a press conference recently, and actually two questions. The first one is, I think the Director Pulte had mentioned that he had had a conversation with you around this $0.99 pricing model. And then he had also mentioned a few times, you know, it sounds too good to be true, so so I'm going to make sure there's nothing in there. But I guess I just want to confirm, he knows of the performance model and the closing, the 65. That's not going to be new to him, correct?

No, no, no, no. He's a smart guy, and he's completely aware of the structure. And I think he supports it.

The other main thing for their conference is obviously the pilot. I guess they've selected 21 lenders to try and test out Vantisco. It's a little bit of a black box, gray box, whatever, for a lot of us. Anything your mortgage team and Julie may have shed, any insights you can share with us?

There's not a lot to know there. I mean, all those lenders, whoever they are, are under NDA and can't talk about it and can't disclose. And so very little is known. We know some of the rules around accepting a band score, the 20 points and the 80% loan-to-value. But other than that, I can't tell you much. I don't know. I think it's a manual process. not sure.

Okay, maybe the other thing you might be able to tell us about is the 10T data has not yet been released. They said in the coming months, quote-unquote summer, you know, what is the hold back for when that gets released? Once that gets released, do you have to go, do these 21 lenders have to go back and test that as well?

Don't know the answer to that. I know that the GSEs are working on it and intend to release. I mean, I think they mentioned the press conference early summer. So we're kind of waiting for them to do that. You know, they have their own processes and procedures, and they're working their way through them. You know, we fully anticipate that it will be released, but we don't have a timeline.

Got it. In terms of 10T, though, when it does come out, I think, you know, historically you've talked about how even today the mortgage market is using FICO version 4 and 5. So how quickly do you think 10T can be adopted, or even VS4?

10T is being adopted fairly quickly in the non-conforming market so it can be adopted i do think there's a ton of inertia i think if the if you ask the industry do you want to change they would say no they would like to just stay with fico classic forever but we are seeing you know we are seeing adoption in the non-conforming market and then once all of classic vantage four and fico 10t are accepted in the conforming market, it's a little hard to say. I mean, you could see a shift. I mean, if you were going to shift, you should shift from Classic to 10T because you'd get more predictiveness out of it. But again, all the systems, models, everything's designed around Classic, so we'll see how long that takes.

There's also an advantage we could run. I mean, you'd run 10T in parallel with Classic FICO, right? That's what's happening in the non-conforming market. So from that point of view, it's easier to run them both at the same time, compare the results, and do some forecasting on that.

Got it. And in the past, you've talked about it's a heavy uplift to switch from scores or go from a classic to something totally different like a Vantage score. What is the lift like to go from classic to 10T?

It's a little easier. So the reason, FICO scores are designed to be backward compatible with prior generation FICO scores, and they always have been, right up to FICO 10. FICO 10 is backward compatible with FICO 9. FICO 10T uses trended data, so it's not perfectly backward compatible. It's a little bit different. But I would say that 10T is architecturally very similar to prior FICO scores. It leverages the same kind of weighting, same attributes. And so if you were going to make some assumptions about how 10T behaves relative to classic, 10T will be a lot closer than Vantage 4 would be.

Got it. The $0.99 plus $0.65 for FICO 10T I think implies a modest price increase versus the $4.95 plus $0.33 you have for Classic. Some people think that's your 2027 pricing that you've introduced today. Is that the case, or how should we think about that?

Well, no, I would say that 2027 pricing is not here yet. We haven't really decided what we're going to do there. Our process is in September, August, September every year, we kind of review things, decide where it would be appropriate to make bigger pricing adjustments, and then we publish them to our partners so that they can be implemented on Jan 1. So none of that has occurred. Any pricing that you see in the market today is 2026 pricing.

Got it. And with all this noise, with all this change, how should we think about, you know, what your price value gap in mortgages, like let's say it's roughly $10 a score today, versus what you think it should be? Because I know you, you know, you talked about this for years. Before this all began, I think people thought, sure, it's going to get there. But now I think they're a lot more skeptical. So, you know, is your approach change? Are you going to balance the annual increases differently? or, you know, what's a FICO mortgage score worth, right?

That's the question. Nobody knows the answer to that. I mean, really, no one knows the answer to it. All you can do is look at analogs. So if you look at S&P and Moody's, they charge approximately eight basis points to rate a mortgage-backed security. They each do, so that's 16 basis points, okay? And that's typical. And those securities that they rate, AAA-rated, guaranteed by the government, They're all AAA-rated, so I'm not sure how useful that is. But they also supply the average weighted FICO score of those securities, and that's what the pricing is built on. The pricing is built on the FICO score, not actually the S&P rating. And I only share that by way of background, because we don't charge anything for using our score in that context. We charge zero. They charge 16 basis points, and we charge zero. And yet the value is all coming from the FICO score. Another way to think about it is 16 basis points on an average $400,000 mortgage is a little over $600. We charge $10 for a score. So you guys will have to make up your own minds about what the value gap is. But I would submit that it's quite large and remains so.

Got it. Maybe one last opportunity on mortgage. Again, we've talked about a lot of noise. What do you think is the most underappreciated or misunderstood aspect of this debate that keeps pressuring your stock?

Look, I think that the FICO mortgage score is deeply, deeply embedded in the system. Not just because it's used by the originators to get the mortgage, but everybody downstream uses it. Fannie and Freddie use that score in their LLPA pricing grids. The mortgage insurers use it in their models for providing mortgage insurance. The credit risk transfer guys, CRT, they use it in their models. The mortgage-backed securities investors themselves use it when they're pricing the MBS. The prudential regulators use it. So there are lots and lots of parties who are pretty deeply focused on FICO as the cornerstone of the system. So I think changing it is very hard, just really hard. I mean, you can create an option, say, sure, you have an option to use Advantage Score. Guess what? There's an option to use Advantage Score in every other market that we have, in auto, in credit card, in account management, in pre-qual, pre-screen, you name it. You want a Advantage Score, Advantage will be happy to provide you with one, and yet nobody uses them. So how different is it going to be in the mortgage market? We'll have to see.

Got it. That's a good segue into the other parts of the market. So in auto for the last several years, I think you've done modest price increases. In card, it's been inflation-type stuff. So maybe just talk on auto firstly. How do we think about the historical price increases? What's the opportunity going forward?

Yeah, I mean, we've been, like you said, modestly increasing prices in auto. A lot of it's really understanding the market, understanding the dynamics. There's a lot of different players in that space. There's a lot of value derived from the score. A lot of times it's the score that determines whether a car is bought or sold. So there's a lot of value there to the dealers, to the people that actually do the financing. So again, we just need to understand the market. And every year we learn a little bit more and we look at the market and look for opportunities to raise prices there where we think that the value is much higher than what we charge.

And both in auto and maybe mortgage as well, right, does the forecasted volumes impact how much pricing you're going to take?

Yeah, I think a little bit. I mean, because in the sense that we don't rely on increases in volume to provide our guidance. So every year what we do is we sit down, we look at all the data sources, come up with kind of a consensus view of the volumes for mortgage or for auto or for whatever. And then we heavily haircut that, you know, because we don't believe it. Most of those are wrong. and because we're conservative and, you know, if you followed us for any time, you know we have a reputation for sandbagging. So, you know, that's kind of where we get to. We don't count on a lot of volume increase to make our numbers. And then what happens is if we really do get a good volume year, which someday we will have in mortgage for sure, you know, we closed 5.8 million mortgages this past year, and, you know, the average over the last five years is over 8 million closed mortgages. So I mean, there's a lot of room to grow. Volumes will come back someday. But we don't count on that. Our guidance is not built on an expectation about volume increase.

We get questions a lot of times, like if mortgage goes up next year, would that mean you do less than the price? Well, we'll never know. So we can't count on that. So we tend to assume that the markets will remain relatively flat.

And then maybe to round it up, like the card strategy, is that just inflation because it's a high volume market?

Yeah, it's a high volume market. There's probably more discretion. There's probably more elasticity, because you really don't need the score in the same way. And there's not really the transaction that takes place that we have in the other markets. So it's more inflation. There are some pockets that will charge a little bit more than inflation. But it's closer to a CPI type price increase. Got it.

Even when and if the DLP programs introduced, the credit bureaus are still going to be your largest customer, whatever the disclosures you you have any 10K. What are the relationships like with the bureaus now, after all this has happened?

Oh, I think they've improved a lot. I mean, look, it's not a secret that there was some friction. I mean, we've gotten along very, very well, certainly for the last 14 years. And FICO surprised them with the direct license program. I mean, I called the CEOs of the bureaus several hours before we announced it to the world and said, guess what? We're launching an alternate distribution channel, probably the most rattling thing in our industry in a decade. And needless to say, they didn't appreciate the lack of a heads up, the fact that we just dropped it on them. And of course, it had big revenue implications for them, big profit implications for them. So we caught them off guard. We didn't treat them with the respect that they deserve, given our relationship. So I understand why they reacted the way they did. As you know, they've all recovered, right? They figured out how to go get that revenue by increasing the data, the price of the data. So the hole that was anticipated has been kind of closed up. So I think that's resolved. And at the end of the day, we have symbiotic relationship with them. We need them as a channel. They need FICO scores, or else their data's not worth very much. And so it's that combination that keeps us working closely And I'd say our relationships are pretty strong.

So no potential spillover effects into card and auto? Any plans there for that?

No, we don't have any plans on that.

And how about on the direct-to-consumer side? Experian, obviously, is a big partner there. Is that a completely separate entity relationship?

They're a great partner there. No, it's not completely separate. It's part and parcel of the whole relationship. They are phenomenal consumer marketers. I would say that they have, although I'm very proud of my FICO in our own little consumer business, we give them every opportunity to take the business. We don't compete with them on search words. I mean, we test things, and when they work, we tell them about it. And they've done just a phenomenal job building that consumer business. It's really impressive, and that'll continue. We feel really good about it, and so do they.

Okay, we have about nine minutes left. Let's turn to software. Maybe a little bit of a, not background, but a mix. Like, you know, what is software? It is a little bit kind of many different things all over the place. So how would you simplify software amongst your top few products or mixes that will help us appreciate it more?

I think the easiest way to think about our software business is our new software business, because the old one is the applications we talked about. The new software business is a decisioning platform, and it's kind of next-generation CRM. So the idea is take data from a lot of different places and apply some analytics, and with that make a decision, which you can then feed into a workflow. and that workflow happens in real time. It gets in real time that decision to a point of interaction with the consumer. So if you're a B2C company, whether you're a bank or a credit union or a retailer, anybody with a B2C relationship wants to optimize that interaction with the consumer to achieve some goal. And it's not always the same thing. It could be they're after revenue, you're close to the end of quarter, and so they're all about conversion. Okay, someone showed up at my website, I just need them to convert and buy something and put a few more dollars in the revenue line. Or maybe revenue's fine, but profit is what matters. So let's emphasize for this customer, you know, things that are more profitable for us. Or maybe those are fine and we want to focus on lifetime value. How do we get this customer from this category to a more valuable category, even though the conversion rates will be lower? The objective function can change. It can change at any time. And it should change. It should really change depending on what the management of the business wants it to do. But what should be consistent is never interact with a customer without taking into account everything you know about the customer. So if you've had 25 transactions with a customer over the prior 24 months, how about we use that knowledge in what we do with that customer? So what we expect is when you show up, we know your brand proclivity, we know your price elasticity, we know what makes you tick, we know how to get you to respond to whatever it is we want you to do. That's what FICO software does. And it does it better than anybody else's. There's nothing that comes close. A lot of B2C companies have tried to build this themselves. Usually we don't compete with other software companies. We compete with homegrown because there really are no solutions quite like ours on the market. And then we are so much lower cost than them building it themselves. You know, they'll go to do something that's halfway as good, they'll spend $100 million, or they can buy ours for $15 million. And so that, you know, that's kind of the dynamic. So it's very popular. We're growing really fast.

So maybe just to follow up there, like you said, a lot of, the way you described it, a lot of software companies, a lot of analytics companies try to say the same thing. What is the secret sauce? Like, are there some key IP assets, brands within that that help you, you know, keep growing at this rate?

Well, if you think about, part of the reason that you don't see a lot of analytic software companies is it's really, really hard to put analytics into software. That's because, you know, what do analytics do? You ask a question, you're looking for an answer to a question, and then you have to figure out which data is the right data to answer that question. And then you have to figure out what's the right analytics technology to put on that data to get to the answer you want and do that all in real time. that's a very complex equation I mean it's just really hard to do and we've mastered it over 40 years and no one else has got it and maybe to that point AI the new LLMs they're making life easier for you are they introducing more competitive threats what's always for us it's good on all on all counts so we get the same productivity benefits that any software company would get from no no longer having to write code. So that's a labor saving. But more importantly, we think that all of the adjacency, the core of our platform is decisioning. We think that all of the adjacencies lend themselves really well to AI-driven agentic behavior. So I don't know. Let me give you an example. We try to detect fraud. And so we'll go in and look at, you know, millions and millions and millions of transactions and try to identify patterns and profiles and figure out what looks odd. And when we find those things, we either, if it looks okay, within 17 milliseconds, we say, looks good. And then the rest of the time, it's an exception, gets kicked out to a fraud analyst. Well, the fraud analyst takes that exception and studies it and looks into your account and checks your checking account balance and other kinds of things, it makes a determination, not in 17 milliseconds, but maybe in a half hour. In our view, an AI agent could do what that analyst does in another 30 seconds. So instead of 17 milliseconds, we get the exception, kicks it out, and now we have an AI agent that does what the fraud analyst used to do. So I think that the banks are going to get tremendous savings out of applying agents to the outcome output of our software.

And maybe the last question in the last two minutes here, you know, sounds like a really neat decision platform. You've been accelerating growth recently, doing very well. What is the vision for software here? How do you, it's still relatively small in the scheme of software, so how do you scale it to the heights that you probably want to take this?

I think if we keep growing the new platform at over 40% a quarter, It'll scale to new heights very quickly. It has been growing really fast. I mean, it's now the new platform is a third of our total software business and growing, you know, much faster than the rest. The rest of it's pretty much flat. And so, you know, we've got the growth. And we'll see. I mean, I think, and also our model is a land and expand model. So anything we land, we typically get a lot more revenue out. And, you know, beyond that, our dollar-based net retention revenue on the platform is 136 percent so you can see that the customers who buy it buy more i mean that's kind of what that means um we'll see you know we don't have you know every time once in a while i get asked questions about are you going to sell it or spin it off and of course that's a question the board asks once a year but um we have no intention of doing that anytime soon right now software is not in favor this wouldn't be a great time for us to spin it off anyway but we really I think it's undervalued and under-recognized.

OK, cool. All right, we'll leave it right there. Appreciate the time. Thank you, guys.