Fair Isaac Corp. (NYSE:FIC – news), whose "FICO" credit scores are used by
millions of Americans to obtain mortgages and other loans, on Monday cut its
quarterly profit and revenue forecasts, sending its shares down more than 10
percent after hours.
The Minneapolis-based provider of financial technologies cited reduced
bookings, which it defines as estimated future contractual revenues, and
"general softness" across its business segments for its lowered outlook.
Fair Isaac now expects a profit of 35 cents to 37 cents per share for its
fiscal second quarter ending March 31, on revenue of $200 million to $202
It also expects a full-year profit of $1.55 to $1.65 per share on revenue of
$795 million to $805 million.
In January, Fair Isaac had projected second-quarter profit of 48 cents per
share on revenue of $215 million, and full-year profit of $2.15 per share on
revenue of $870 million.
Analysts polled by Reuters Estimates, on average, forecast a profit of 51
cents per share on revenue of $213.5 million for the second quarter, and a
profit of $2.21 per share on revenue of $865.8 million for the full year.
On a conference call, Chief Financial Officer Charles Osborne said Fair Isaac
faces "lower contract values within the mortgage, insurance bill review and
fraud product lines." Product delays also contributed to the shortfall, he
Chief Executive Mark Greene said the greater difficulties among higher-risk,
"subprime" homebuyers to refinance or obtain new loans had little net effect on
"The subprime market does show signs of cooling off in terms of levels of
originations," Greene said. "On the other hand, there is a little bit more
interest than in the past for some of our fraud offerings. So net, it is a
Fair Isaac shares fell $4.15, or 10.2 percent, to $36.40 in after-hours
electronic trading, after closing up 34 cents on the New York Stock