Software Platform Growth Deceleration
Q: Is 30% growth the new level for the platform?
A: Management acknowledged that platform growth has slowed from over 50% to the 30% range, attributing it to the law of large numbers and challenging comparisons. They consider 30% growth sustainable and see no cause for concern, noting that customers continue to adopt and expand use cases. The second half of the year is typically stronger. "

Mortgage Pricing Strategy and Regulatory Noise
Q: How do you address concerns about mortgage pricing increases?
A: Management stated they're catching up from 30 years of frozen pricing, aiming to align charges with the value provided. They view transparency as beneficial, emphasizing that the FICO Score cost is in the single-digit dollars within a $6,000 consumer bundle. They address criticism by highlighting the minimal impact of their pricing on overall costs. "

Software Bookings and Macro Impact
Q: Is the slowdown in software bookings due to macro factors?
A: Management attributed some slowdown to the macro environment, noting that projects are being deferred or taking longer. They emphasized they're not losing to competitors but believe it's fair to link delays to macroeconomic conditions. "

Capital Return and Share Repurchases
Q: How should we think about buyback pace going forward?
A: Management remains committed to share buybacks, intending to spend at least their free cash flow, often more, on repurchases annually. They anticipate increased buybacks as leverage has decreased due to higher earnings. "

Card and Auto Originations Volumes
Q: Any changes in expectations for card and auto volumes?
A: Management sees volumes aligning with expectations amid macro conditions. They've observed slight declines in auto and more in credit card originations but are not surprised given the environment. "

Expense Trajectory and FICO World Impact
Q: What is the expected expense growth for the rest of the year?
A: Expenses will increase slightly in Q3 due to the FICO World event, a significant expense. Q4 expenses are expected to be flat or slightly down, with no significant uptick anticipated. "

Retention Rates and Investment Areas
Q: How should we think about long-term retention rates and expenses?
A: Nonplatform net retention may dip below 100% as legacy products shift to the platform. Platform net retention remains strong, ranging from 110% to over 140%, with customers consistently increasing usage year over year. Expenses are stable, focusing on R&D, product development, ecosystem, and expanding both direct and indirect sales channels. "

Platform ARR Growth: Land vs. Expand
Q: Is growth driven more by new wins or existing clients?
A: While landing new clients is key, expansion within existing clients is becoming significant. Many initial use cases are small, and growth often comes from clients expanding their use cases over time. They anticipate that expansion will exceed new landings in the future. "

Nonplatform Software Pricing Strategy
Q: What's your approach to pricing in the nonplatform business?
A: The nonplatform business is mature and deeply embedded. Management avoids aggressive pricing, raising prices modestly to cover costs like new features and cybersecurity. They focus on maintaining long-term customer relationships rather than maximizing short-term gains. "

Professional Services Revenue Outlook
Q: Is the current professional services revenue range sustainable?
A: Management expects professional services revenue to stabilize around $19 million to $22 million per quarter. They provide enough services to ensure quality installations but are happy to have partners handle implementations. They don't anticipate significant further declines. "

On-Premise Software Outlook
Q: How should we view the future of on-premise software?
A: While FICO is cloud-first, they'll continue to support on-premise solutions for customers who prefer it. The on-premise segment isn't expected to grow significantly but also isn't likely to shrink rapidly due to deeply embedded systems that take years to transition to the cloud. "