Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
Fair Isaac Corp., profitability ratios
Based on: 10-K (reporting date: 2024-09-30), 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30).
- Gross Profit Margin
- The gross profit margin has exhibited a consistent upward trend over the six-year period, increasing from 70.96% in 2019 to 79.73% in 2024. This steady growth indicates an improving efficiency in production or service delivery costs relative to revenue.
- Operating Profit Margin
- Operating profit margin shows significant improvement, rising from 21.86% in 2019 to 42.71% in 2024. Notably, there is a substantial jump between 2020 and 2021, where it increased from 22.86% to 38.4%. The margin then continues a gradual increase, suggesting enhanced operational efficiency and effective control over operating expenses.
- Net Profit Margin
- Net profit margin also reflects a positive trend, beginning at 16.56% in 2019 and reaching 29.86% by 2024. Although there is a slight dip from 29.78% in 2021 to 27.12% in 2022, the overall trajectory is upward. This indicates improving profitability after all expenses, taxes, and costs have been accounted for.
- Return on Equity (ROE)
- Return on equity was notably high at 66.3% in 2019 and increased to 71.41% in 2020. Data for subsequent years is missing, preventing a complete trend analysis. However, the initial values indicate a strong ability to generate returns on shareholders' equity during the early period.
- Return on Assets (ROA)
- Return on assets has shown a pronounced improvement, rising from 13.4% in 2019 to 29.85% in 2024. This reflects increasing effectiveness in utilizing asset base to generate profit, with particularly notable jumps occurring from 2020 onwards.
Return on Sales
Return on Investment
Gross Profit Margin
Fair Isaac Corp., gross profit margin calculation, comparison to benchmarks
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Gross profit | 1,369,320) | 1,202,504) | 1,075,096) | 984,074) | 933,420) | 823,238) | |
| Revenues | 1,717,526) | 1,513,557) | 1,377,270) | 1,316,536) | 1,294,562) | 1,160,083) | |
| Profitability Ratio | |||||||
| Gross profit margin1 | 79.73% | 79.45% | 78.06% | 74.75% | 72.10% | 70.96% | |
| Benchmarks | |||||||
| Gross Profit Margin, Competitors2 | |||||||
| Accenture PLC | 32.61% | 32.34% | 31.99% | 32.38% | 31.53% | 30.81% | |
| Adobe Inc. | 89.04% | 87.87% | 87.70% | 88.18% | 86.62% | 85.03% | |
| Cadence Design Systems Inc. | 86.05% | 89.36% | 89.57% | 89.73% | 88.61% | — | |
| CrowdStrike Holdings Inc. | 75.27% | 73.17% | 73.60% | 73.75% | 70.58% | — | |
| International Business Machines Corp. | 56.65% | 55.45% | 54.00% | 54.90% | 48.32% | — | |
| Intuit Inc. | 78.72% | 78.13% | 81.09% | 82.53% | 82.05% | 82.80% | |
| Microsoft Corp. | 69.76% | 68.92% | 68.40% | 68.93% | 67.78% | 65.90% | |
| Oracle Corp. | 71.41% | 72.85% | 79.08% | 80.59% | 79.68% | — | |
| Palantir Technologies Inc. | 80.25% | 80.62% | 78.56% | 77.99% | 67.74% | — | |
| Palo Alto Networks Inc. | 74.35% | 72.29% | 68.76% | 70.05% | 70.68% | 72.12% | |
| Salesforce Inc. | 75.50% | 73.34% | 73.48% | 74.41% | 75.23% | — | |
| ServiceNow Inc. | 79.18% | 78.59% | 78.29% | 77.05% | 78.16% | — | |
| Synopsys Inc. | 79.68% | 79.08% | 79.07% | 79.50% | 78.44% | 77.60% | |
| Workday Inc. | 75.60% | 72.41% | 72.21% | 72.25% | 70.63% | — | |
Based on: 10-K (reporting date: 2024-09-30), 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30).
1 2024 Calculation
Gross profit margin = 100 × Gross profit ÷ Revenues
= 100 × 1,369,320 ÷ 1,717,526 = 79.73%
2 Click competitor name to see calculations.
The financial data exhibit a consistent upward trajectory over the analyzed periods in key performance indicators such as gross profit, revenues, and gross profit margin. This positive trend reflects strong operational performance and an improving cost structure.
- Gross Profit
- The gross profit increased steadily each year, starting from 823,238 thousand US dollars in 2019 and reaching 1,369,320 thousand US dollars by 2024. This represents a notable growth, indicating enhanced profitability and possibly higher sales volumes or improved pricing strategies.
- Revenues
- Revenues followed a similar upward pattern, rising from 1,160,083 thousand US dollars in 2019 to 1,717,526 thousand US dollars in 2024. This steady increase suggests sustained business expansion and successful revenue generation across the periods.
- Gross Profit Margin
- The gross profit margin showed continuous improvement, starting at 70.96% in 2019 and increasing to 79.73% by 2024. This improvement in margin indicates enhanced efficiency in production or service delivery, cost control, or a favorable sales mix contributing to higher profitability per unit of revenue.
Overall, the trends illustrate robust financial health characterized by growing top-line revenues and expanding margins, which may contribute positively to the company's long-term sustainability and competitiveness in its industry.
Operating Profit Margin
Fair Isaac Corp., operating profit margin calculation, comparison to benchmarks
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Operating income | 733,629) | 642,830) | 542,414) | 505,489) | 295,969) | 253,548) | |
| Revenues | 1,717,526) | 1,513,557) | 1,377,270) | 1,316,536) | 1,294,562) | 1,160,083) | |
| Profitability Ratio | |||||||
| Operating profit margin1 | 42.71% | 42.47% | 39.38% | 38.40% | 22.86% | 21.86% | |
| Benchmarks | |||||||
| Operating Profit Margin, Competitors2 | |||||||
| Accenture PLC | 14.79% | 13.74% | 15.21% | 15.08% | 14.69% | 14.59% | |
| Adobe Inc. | 31.35% | 34.26% | 34.64% | 36.76% | 32.93% | 29.25% | |
| Cadence Design Systems Inc. | 29.10% | 30.59% | 30.15% | 26.07% | 24.06% | — | |
| CrowdStrike Holdings Inc. | -0.07% | -8.48% | -9.82% | -10.58% | -30.34% | — | |
| International Business Machines Corp. | 14.95% | 15.17% | 13.50% | 11.97% | 9.22% | — | |
| Intuit Inc. | 22.29% | 21.86% | 20.20% | 25.95% | 28.34% | 27.33% | |
| Microsoft Corp. | 44.64% | 41.77% | 42.06% | 41.59% | 37.03% | 34.14% | |
| Oracle Corp. | 28.99% | 26.21% | 25.74% | 37.58% | 35.57% | — | |
| Palantir Technologies Inc. | 10.83% | 5.39% | -8.46% | -26.66% | -107.41% | — | |
| Palo Alto Networks Inc. | 8.52% | 5.62% | -3.43% | -7.15% | -5.25% | -1.87% | |
| Salesforce Inc. | 14.38% | 3.29% | 2.07% | 2.14% | 1.74% | — | |
| ServiceNow Inc. | 12.42% | 8.49% | 4.90% | 4.36% | 4.40% | — | |
| Synopsys Inc. | 22.13% | 21.72% | 22.87% | 17.48% | 16.83% | 15.48% | |
| Workday Inc. | 2.52% | -3.57% | -2.27% | -5.76% | -13.85% | — | |
| Operating Profit Margin, Sector | |||||||
| Software & Services | 30.41% | 27.43% | 27.41% | 28.21% | 24.17% | — | |
| Operating Profit Margin, Industry | |||||||
| Information Technology | 26.62% | 24.49% | 26.43% | 26.73% | 22.69% | — | |
Based on: 10-K (reporting date: 2024-09-30), 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30).
1 2024 Calculation
Operating profit margin = 100 × Operating income ÷ Revenues
= 100 × 733,629 ÷ 1,717,526 = 42.71%
2 Click competitor name to see calculations.
- Operating Income
- The operating income demonstrates a consistent upward trajectory over the six-year period. Starting from approximately 253.5 million US dollars in 2019, it rose steadily each year, reaching over 733.6 million US dollars by 2024. This represents a nearly threefold increase, indicating significant growth in the company's core profitability.
- Revenues
- Revenues followed a positive growth trend as well, increasing from about 1.16 billion US dollars in 2019 to around 1.72 billion US dollars in 2024. The growth rate was somewhat moderate initially, with a notable acceleration in the latter years, particularly between 2022 and 2024. This consistent increase in revenues supports the expansion observed in operating income.
- Operating Profit Margin
- The operating profit margin shows a marked improvement over the period under review. Beginning at 21.86% in 2019, the margin increased steadily to 42.71% by 2024. Significant jumps are evident from 2020 onwards, with the margin nearly doubling between 2020 and 2021 and continuing to improve thereafter. This suggests enhanced operational efficiency or a shift to higher-margin activities, contributing to the growing profitability independently of revenue increases.
- Overall Insights
- The data indicates robust financial performance characterized by strong revenue growth accompanied by disproportionate increases in operating income, resulting in substantially improved profitability margins. This trend points to effective cost management and operational leverage. The consistent margin enhancement alongside rising revenues suggests strengthening business fundamentals and profitable scale expansion over the analyzed timeframe.
Net Profit Margin
Fair Isaac Corp., net profit margin calculation, comparison to benchmarks
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net income | 512,811) | 429,375) | 373,541) | 392,084) | 236,411) | 192,124) | |
| Revenues | 1,717,526) | 1,513,557) | 1,377,270) | 1,316,536) | 1,294,562) | 1,160,083) | |
| Profitability Ratio | |||||||
| Net profit margin1 | 29.86% | 28.37% | 27.12% | 29.78% | 18.26% | 16.56% | |
| Benchmarks | |||||||
| Net Profit Margin, Competitors2 | |||||||
| Accenture PLC | 11.19% | 10.72% | 11.17% | 11.69% | 11.52% | 11.06% | |
| Adobe Inc. | 25.85% | 27.97% | 27.01% | 30.55% | 40.88% | 26.42% | |
| Cadence Design Systems Inc. | 22.74% | 25.46% | 23.84% | 23.29% | 22.02% | — | |
| CrowdStrike Holdings Inc. | 2.92% | -8.18% | -16.18% | -10.59% | -29.45% | — | |
| International Business Machines Corp. | 9.60% | 12.13% | 2.71% | 10.01% | 7.59% | — | |
| Intuit Inc. | 18.19% | 16.59% | 16.23% | 21.41% | 23.78% | 22.95% | |
| Microsoft Corp. | 35.96% | 34.15% | 36.69% | 36.45% | 30.96% | 31.18% | |
| Oracle Corp. | 19.76% | 17.02% | 15.83% | 33.96% | 25.94% | — | |
| Palantir Technologies Inc. | 16.13% | 9.43% | -19.61% | -33.75% | -106.75% | — | |
| Palo Alto Networks Inc. | 32.11% | 6.38% | -4.85% | -11.72% | -7.83% | -2.82% | |
| Salesforce Inc. | 11.87% | 0.66% | 5.45% | 19.16% | 0.74% | — | |
| ServiceNow Inc. | 12.97% | 19.30% | 4.49% | 3.90% | 2.62% | — | |
| Synopsys Inc. | 36.94% | 21.05% | 19.38% | 18.02% | 18.03% | 15.84% | |
| Workday Inc. | 19.02% | -5.90% | 0.57% | -6.54% | -13.25% | — | |
| Net Profit Margin, Sector | |||||||
| Software & Services | 24.73% | 21.95% | 21.72% | 25.30% | 20.05% | — | |
| Net Profit Margin, Industry | |||||||
| Information Technology | 20.64% | 20.39% | 22.45% | 23.62% | 19.67% | — | |
Based on: 10-K (reporting date: 2024-09-30), 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30).
1 2024 Calculation
Net profit margin = 100 × Net income ÷ Revenues
= 100 × 512,811 ÷ 1,717,526 = 29.86%
2 Click competitor name to see calculations.
- Revenue Trend
- The revenues exhibit a consistent upward trajectory over the observed periods. Starting at approximately 1.16 billion US dollars in 2019, revenues increased each year, reaching about 1.72 billion US dollars by 2024. This steady growth indicates a sustained expansion in the company's sales or service income streams.
- Net Income Evolution
- Net income shows a significant increase from 192.1 million US dollars in 2019 to 512.8 million US dollars in 2024. There is a notable acceleration in net income growth especially between 2020 and 2021, where income rose from 236.4 million to 392.1 million US dollars. Though there was a slight decline between 2021 and 2022, net income resumed its upward trend in subsequent years.
- Net Profit Margin Analysis
- The net profit margin has improved markedly over the period. Starting at 16.56% in 2019, it climbs steeply to nearly 30% by 2024. Despite a minor decrease in 2022, the margin remains elevated relative to earlier years, indicating enhanced profitability and more efficient cost management or pricing strategies.
- Overall Financial Performance Insight
- The data reflects robust financial health, with revenues and net income both growing strongly and profit margins increasing substantially. The business appears to have strengthened its ability to convert sales into profit, maintaining solid growth momentum across all key financial metrics through the periods under review.
Return on Equity (ROE)
Fair Isaac Corp., ROE calculation, comparison to benchmarks
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net income | 512,811) | 429,375) | 373,541) | 392,084) | 236,411) | 192,124) | |
| Stockholders’ equity (deficit) | (962,679) | (687,990) | (801,947) | (110,942) | 331,082) | 289,767) | |
| Profitability Ratio | |||||||
| ROE1 | — | — | — | — | 71.41% | 66.30% | |
| Benchmarks | |||||||
| ROE, Competitors2 | |||||||
| Accenture PLC | 25.68% | 26.75% | 31.11% | 30.25% | 30.05% | 33.17% | |
| Adobe Inc. | 39.42% | 32.86% | 33.85% | 32.59% | 39.66% | 28.03% | |
| Cadence Design Systems Inc. | 22.58% | 30.58% | 30.93% | 25.39% | 23.69% | — | |
| CrowdStrike Holdings Inc. | 3.88% | -12.52% | -22.89% | -10.64% | -19.10% | — | |
| International Business Machines Corp. | 22.06% | 33.29% | 7.47% | 30.38% | 27.14% | — | |
| Intuit Inc. | 16.07% | 13.81% | 12.57% | 20.89% | 35.76% | 41.53% | |
| Microsoft Corp. | 32.83% | 35.09% | 43.68% | 43.15% | 37.43% | 38.35% | |
| Oracle Corp. | 120.26% | 792.45% | — | 262.43% | 83.94% | — | |
| Palantir Technologies Inc. | 9.24% | 6.04% | -14.57% | -22.71% | -76.61% | — | |
| Palo Alto Networks Inc. | 49.86% | 25.15% | -127.14% | -78.63% | -24.23% | -5.16% | |
| Salesforce Inc. | 6.93% | 0.36% | 2.48% | 9.81% | 0.37% | — | |
| ServiceNow Inc. | 14.83% | 22.69% | 6.46% | 6.22% | 4.18% | — | |
| Synopsys Inc. | 25.17% | 20.01% | 17.85% | 14.31% | 13.54% | 13.04% | |
| Workday Inc. | 17.09% | -6.57% | 0.65% | -8.62% | -19.33% | — | |
| ROE, Sector | |||||||
| Software & Services | 28.71% | 28.63% | 31.20% | 36.34% | 30.37% | — | |
| ROE, Industry | |||||||
| Information Technology | 29.37% | 32.00% | 39.15% | 42.48% | 35.75% | — | |
Based on: 10-K (reporting date: 2024-09-30), 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30).
1 2024 Calculation
ROE = 100 × Net income ÷ Stockholders’ equity (deficit)
= 100 × 512,811 ÷ -962,679 = —
2 Click competitor name to see calculations.
- Net Income
- The net income demonstrates a generally increasing trend over the six-year period. Starting at $192,124 thousand in 2019, it rose steadily each year, reaching $512,811 thousand by 2024. Notably, there was a significant increase from 2020 to 2021 and a slight decline in 2022 before resuming growth again in 2023 and 2024. This indicates an overall strengthening profitability position with substantial growth in recent years.
- Stockholders’ Equity (Deficit)
- The stockholders’ equity presents a contrasting and concerning trend. Initially positive and increasing from $289,767 thousand in 2019 to $331,082 thousand in 2020, it then sharply declined into negative territory starting in 2021, reaching -$110,942 thousand. The negative equity deepened significantly over the following years, with the deficit worsening to -$962,679 thousand by 2024. This persistent and expanding negative equity position suggests significant financial imbalance or restructuring impacts, which pose risks to financial stability despite rising net income.
- Return on Equity (ROE)
- Return on equity was reported as 66.3% in 2019 and increased to 71.41% in 2020. Data for subsequent years are missing, likely due to the negative equity figures that render the ratio less meaningful or undefined. The initially high ROE results suggest efficient use of equity to generate profits until 2020, but the subsequent negative equity impacts the reliability and calculation of this metric.
- Summary
- Overall, the financial data reveals a company with growing net income and high profitability ratios in the early years. However, the striking shift from positive to significantly negative stockholders’ equity from 2021 onward indicates underlying financial challenges that could undermine long-term solvency. The negative equity could be the result of accumulated losses, asset write-downs, or liabilities exceeding assets despite increasing net income. This juxtaposition highlights a complex financial situation requiring detailed investigation into the causes of equity erosion while maintaining a focus on sustaining profit growth.
Return on Assets (ROA)
Fair Isaac Corp., ROA calculation, comparison to benchmarks
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net income | 512,811) | 429,375) | 373,541) | 392,084) | 236,411) | 192,124) | |
| Total assets | 1,717,884) | 1,575,281) | 1,442,034) | 1,567,776) | 1,606,240) | 1,433,448) | |
| Profitability Ratio | |||||||
| ROA1 | 29.85% | 27.26% | 25.90% | 25.01% | 14.72% | 13.40% | |
| Benchmarks | |||||||
| ROA, Competitors2 | |||||||
| Accenture PLC | 12.99% | 13.41% | 14.55% | 13.68% | 13.78% | 16.04% | |
| Adobe Inc. | 18.39% | 18.23% | 17.51% | 17.70% | 21.66% | 14.22% | |
| Cadence Design Systems Inc. | 11.76% | 18.36% | 16.53% | 15.87% | 14.95% | — | |
| CrowdStrike Holdings Inc. | 1.34% | -3.65% | -6.49% | -3.39% | -10.09% | — | |
| International Business Machines Corp. | 4.39% | 5.55% | 1.29% | 4.35% | 3.58% | — | |
| Intuit Inc. | 9.22% | 8.58% | 7.45% | 13.29% | 16.70% | 24.78% | |
| Microsoft Corp. | 17.21% | 17.56% | 19.94% | 18.36% | 14.70% | 13.69% | |
| Oracle Corp. | 7.42% | 6.33% | 6.15% | 10.48% | 8.78% | — | |
| Palantir Technologies Inc. | 7.29% | 4.64% | -10.80% | -16.02% | -43.35% | — | |
| Palo Alto Networks Inc. | 12.89% | 3.03% | -2.18% | -4.87% | -2.95% | -1.24% | |
| Salesforce Inc. | 4.14% | 0.21% | 1.52% | 6.14% | 0.23% | — | |
| ServiceNow Inc. | 6.99% | 9.96% | 2.44% | 2.13% | 1.36% | — | |
| Synopsys Inc. | 17.31% | 11.90% | 10.45% | 8.66% | 8.27% | 8.31% | |
| Workday Inc. | 8.39% | -2.72% | 0.28% | -3.24% | -7.05% | — | |
| ROA, Sector | |||||||
| Software & Services | 12.19% | 11.21% | 11.41% | 12.29% | 9.68% | — | |
| ROA, Industry | |||||||
| Information Technology | 11.95% | 12.52% | 14.57% | 14.67% | 11.45% | — | |
Based on: 10-K (reporting date: 2024-09-30), 10-K (reporting date: 2023-09-30), 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30).
1 2024 Calculation
ROA = 100 × Net income ÷ Total assets
= 100 × 512,811 ÷ 1,717,884 = 29.85%
2 Click competitor name to see calculations.
- Net Income
- The net income exhibits a consistent upward trend over the six-year period. Starting at 192,124 thousand US dollars in 2019, it increased significantly to 236,411 in 2020, followed by a substantial jump to 392,084 in 2021. Although there was a slight decline in 2022 to 373,541, the figure rebounded in subsequent years, reaching 429,375 in 2023 and further rising to 512,811 in 2024. This pattern suggests sustained growth in profitability with only a minor interruption in momentum in 2022.
- Total Assets
- Total assets show a moderate overall increase during the period but with some fluctuations. Beginning at 1,433,448 thousand US dollars in 2019, assets rose to 1,606,240 in 2020. They then slightly declined in 2021 to 1,567,776 and continued to decrease to 1,442,034 in 2022. After this trough, the asset base recovered strongly in 2023 to 1,575,281 and further to 1,717,884 in 2024. This indicates some variability in asset levels but an overall expansion by the end of the period.
- Return on Assets (ROA)
- The ROA demonstrates a clear and steady improvement throughout the entire span, reflecting enhanced efficiency in generating profit from assets. Beginning at 13.4% in 2019, the ratio improved to 14.72% in 2020, then increased sharply to 25.01% in 2021. Growth continued at a moderate pace in 2022 and 2023, reaching 25.9% and 27.26% respectively, before culminating at 29.85% in 2024. This upward trajectory indicates increasing operational effectiveness and suggests better asset utilization.
- Overall Analysis
- The financial data highlights a positive performance trend over the six-year period. The company has consistently increased net income, navigating a minor setback in 2022 but maintaining a strong recovery afterwards. Despite some fluctuations, the total asset base shows a net gain, aligning with the improving return on assets which points to enhanced profitability relative to the size of assets. The rising ROA particularly underscores improved asset management and profitability efficiency. Together, these trends reflect favorable financial health and operational success over the observed timeframe.