Equifax (NYSE:EFX) reported what CEO Mark Begor called a “very strong” start to 2026, driven by outperformance in U.S. mortgage and continued momentum in Workforce Solutions, while keeping its full-year outlook unchanged amid heightened macro and interest-rate uncertainty tied to the Iran conflict.
First-quarter results outpaced expectations
Begor said first-quarter reported revenue was $1.649 billion, up 14% and $37 million above the midpoint of the company’s February guidance. On an organic constant currency basis, revenue grew 13%, more than 200 basis points above the February framework midpoint. Excluding FICO mortgage score royalty pass-through revenue, Begor said revenue growth was about 10%, at the top end of Equifax’s stated 7% to 10% long-term framework.
Begor noted first-quarter EBITDA margins and EPS are typically lower than later quarters because “a large percentage of our employee equity plan expenses” are recognized in the first quarter.
Mortgage strength, then rate-driven softening
The quarter’s revenue outperformance was “principally in U.S. mortgage,” which Begor said was up 38% and ahead of the company’s February outlook due to stronger activity in the middle of the quarter before interest rates increased. Begor attributed the later shift to market uncertainty and higher rates tied to the Iran conflict, which he said reduced U.S. transactional activity—most notably in mortgage and “to a lesser degree, auto and banking.”
In USIS, Begor said revenue rose 21% in the first quarter and 8% excluding FICO, with mortgage the key driver. USIS mortgage revenue was up 60% and up 24% excluding FICO, supported by what Begor described as meaningful share gains in mortgage pre-approval soft pull products tied to The Work Number (TWN) Indicator.
Begor said mortgage inquiries have declined over the past six weeks from elevated February levels and the company expects lower levels to persist until the Iran conflict is resolved and interest rates moderate. He added that current mortgage run rates are “slightly below” the levels reflected in Equifax’s February 2026 framework.
Workforce Solutions execution and government pipeline
Workforce Solutions revenue increased more than 10% and exceeded expectations, Begor said. Within the segment, Verifier revenue was up 14%, with diversified markets revenue growth also at 14%. Begor highlighted “a very strong quarter” in the government vertical with revenue up “mid-double digits,” driven by continued state-level penetration.
However, Begor cautioned that government can be “bumpy” due to the timing of deal closures and activations and state budget pressures. He said second-quarter government revenue is expected to be “about flat sequentially” against a difficult comparison tied to a large SSA contract win that activated in April of the prior year.
On the expanded government opportunity tied to OB3, Begor reiterated the company expects the “substantial portions” of that opportunity to materialize later, “but really principally in 2027,” as new Medicaid and SNAP requirements take effect. He said Equifax’s pipelines for new and expanded government services are up more than 2x year over year, though timing can be affected by system integration and budget frameworks.
Begor also said Equifax launched “Continuous Evaluation for SNAP” in the first quarter using EFX.AI, noting it has already produced results for “a few states” by identifying errors within beneficiary populations.
Talent Solutions revenue rose nearly 10%, marking a second consecutive quarter of high single-digit growth despite what Begor described as a “challenging white-collar hiring market.” He cited client penetration, pricing, product penetration, and data additions, including education and incarceration solutions.
Workforce Solutions EBITDA margin was 52.3%, up 200 basis points year over year, driven by operating leverage and “AI-driven productivity,” while continuing investment in new products, government, and record additions, Begor said.
AI, cloud progress, and new product cadence
Begor emphasized Equifax’s EFX 2028 strategy and said the company’s Vitality Index—a measure of revenue from new products—reached a record 17% in the quarter. He said Equifax added more than 40 EFX.AI-based patents in 2025 and 10 more in the first quarter, bringing the total to 400 pending or granted AI-based patents.
Begor also said more than 90% of products were built on Equifax’s cloud platforms last year, and that 100% of new models and scores in 2025 were built using EFX.AI. He highlighted the launch of Ignite AI Advisor for Auto, which provides lenders with “plain English analytics” and conversational tools, with similar solutions expected for cards and personal loans this year.
On operational efficiency, Begor described AI-driven productivity as “still early days,” pointing to work in call centers and document processing, as well as early progress using AI tools for coding and broader efficiency across support functions.
Guidance held steady; capital return and VantageScore optionality
CFO John Gamble said Equifax is holding constant currency full-year 2026 revenue guidance unchanged from February, citing “a heightened level of economic uncertainty” and uncertainty in interest rates and mortgage volumes. He said Equifax updated reported guidance to reflect foreign exchange, raising the midpoint of reported revenue by $25 million to $6.745 billion and adjusted EPS by $0.04 to $8.54. Gamble said FX is about 90 basis points favorable to revenue growth for the year.
For the second quarter, Gamble guided to revenue of $1.680 billion to $1.710 billion and EPS of $2.15 to $2.25. Diversified markets revenue is expected to rise mid-single digits on a constant currency basis, while U.S. mortgage revenue is expected to be up more than 20%, he said.
Begor said the company returned $327 million to shareholders in the quarter, including $260 million in share repurchases (1.3 million shares, about 1% of shares outstanding) and $67 million in dividends. He also noted Equifax increased its quarterly dividend by 12% to $0.56 per share. Both Begor and Gamble reiterated expectations for more than $1 billion in free cash flow in 2026 and cash conversion of at least 100%, creating approximately $1.5 billion of capacity for bolt-on M&A and shareholder returns while maintaining leverage targets.
On mortgage scoring, Begor reiterated that Equifax makes “no margin” on FICO score sales and that FICO mortgage score revenue represents about half of USIS mortgage revenue and about 6% of total Equifax revenue. Equifax’s 2026 framework assumes no VantageScore conversion this year. Still, management said momentum is building: Begor said more than 240 mortgage originators are ingesting a free VantageScore alongside a paid FICO offering, and more than 50 primarily non-GSE lenders are using VantageScore for mortgage originations. He also said Equifax lowered VantageScore mortgage pricing to $1 from a $4.50–$1 range to further encourage conversion.
Begor pointed to an estimated $35 million annual margin upside at current mortgage run rates from full conversion to VantageScore, describing the economics as “100% margin” on the $1 price compared with zero margin on FICO pass-through. However, he emphasized the company is not forecasting conversion timing and will update guidance as there is more clarity from FHFA activation and industry adoption.
About Equifax (NYSE:EFX)
Equifax Inc (NYSE: EFX) is a global data, analytics and technology company that specializes in consumer and commercial credit reporting, decisioning tools and identity solutions. Headquartered in Atlanta, Georgia, Equifax is one of the three major consumer credit reporting agencies in the United States and provides credit information and related services to lenders, employers, governments and consumers worldwide.
The company’s offerings include consumer credit reports and scores, credit monitoring and identity protection services, and a range of business-oriented products for risk management, fraud detection and compliance.
