Equifax's Global Revenue Trends: Driving Future Growth

Current Revenue Performance

Equifax's current revenue performance is robust, with significant growth in non-mortgage business (13%) and international markets (28%). The Asia Pacific region is expected to return to growth, and new product innovations are driving a 12.5% Vitality Index. However, foreign exchange impacts revenue negatively by 2 points.

"We expect Asia Pacific to return to revenue growth in the second-half. International adjusted EBITDA margins of 25.6% were above our expectations and up 130 basis points sequentially, given their strong revenue growth performance.Turning to slide 10, we continue to make very strong progress driving innovation, with over 30 new products launched in the quarter that delivered a 12.5% Vitality Index, which was up 350 basis points sequentially and was driven by broad-based performance across all of our business units." --- (EFX, earning call, 2024/Q2)

""Our non-mortgage business, which was about 80% of Equifax revenue in the second quarter, delivered very strong broad-based 13% local currency revenue growth, from continued significant new product performance with a New Product Vitality Index of 12.5% and 89% of new models and scores built using AI and ML." --- (EFX, press release, 2024/07/17)

"This performance was driven by 20% non-mortgage growth in EWS Verifier, led by strong 30% growth in government and talent that was up over 13%. International delivered 28% constant dollar revenue growth and strong 12% organic growth, led by strong growth in Latin America and Europe." --- (EFX, earning call, 2024/Q2)

"Yes, redeterminations are technically completed by the end of March. So yes, that revenue should decline, but we're seeing really good performance across government strength in CMS, strength in other areas, strength within the states." --- (EFX, earning call, 2024/Q1)

"FX is negative to revenue about 2 points. Business unit performance in the second quarter is expected to be as follows." --- (EFX, earning call, 2024/Q1)

Market Expansion Efforts

Equifax is focusing on reinvesting in its core business, leveraging cloud technology, and expanding EFX.AI to drive growth. These efforts, combined with initiatives to expand products, capabilities, and markets, are expected to enhance demand and accelerate new product rollouts, ultimately boosting revenue and market presence.

"We're reinvesting in the core Equifax. When that mortgage market recovery comes, we would expect that to be incremental to our growth rates, incremental to our margin expansion and incremental to our free cash flow, which obviously will be a part of our planned capital allocation to start returning cash to shareholders at the right And can you just comment on the CFPB request for inquiry or request for information?" --- (EFX, conference, 2024/06/04)

"And as you point out, when hiring, I would call it in the white collar side stabilizes or perhaps when rates come down and there's some increase in economic activity, we'll get some tailwind from the market side as people are expanding their businesses, and then we'll have things under our control to continue to adding records." --- (EFX, earning call, 2024/Q1)

"We expect to have a significant competitive advantage as we pivot from building to leveraging the cloud that will allow us to fully focus on growth, innovation, new products, and AI going forward. Completing the USIS cloud and expanding EFX.AI, along with continued expansion of our differentiated data assets, will accelerate innovation and new products at USIS that will drive our top and bottom line." --- (EFX, earning call, 2024/Q2)

"Demand is also enhanced by our initiatives to expand our products, capabilities and markets served." --- (EFX, sec filing, 2024/Q1)

"So that’s going to continue. And businesses like USIS that have been constructed by their cloud migration efforts over the last year and change as they complete the cloud, we would expect that to accelerate their new product rollouts going forward." --- (EFX, earning call, 2024/Q1)

Product and Service Innovations

Equifax's product and service innovations focus on delivering more value through new solutions, leveraging data, and cloud transformation. These initiatives enhance customer acquisition, cross-selling, and portfolio risk management, driving competitive advantage and revenue growth.

"And that's an innovative company. And an innovative company is more important to your customers." --- (EFX, conference, 2024/06/05)

"I think we've talked about that in Government and Talent and others.And then product is a big deal, bringing new solutions that deliver more value to our customers, meaning whether it's multiple data solutions or more historical data, those are generally at a different higher price point because they're bringing more value." --- (EFX, earning call, 2024/Q2)

"Financial Marketing Services revenue is principally project and subscription based and is derived from our sales of batch credit and consumer wealth information such as those that assist clients in acquiring new customers, cross-selling to existing customers and managing portfolio risk." --- (EFX, sec filing, 2024/Q1)

"So we're really energized around the always-on stability that will drive our competitive advantage, and then as you point out, the ability to roll out more new products, leveraging the USIS data, but then also bridging between USIS and EWS going forward." --- (EFX, earning call, 2024/Q2)

"We increased that as a part of the cloud transformation, as a part of our new product initiative and with workforce growing faster than the rest of Equifax, we increased that from 7 to 10 to 8 to 12 and took the operating leverage up from 25 bps to 50 bps a year." --- (EFX, conference, 2024/06/05)

Strategic Partnerships and Collaborations

Equifax has significantly expanded its strategic partnerships, driven by leadership changes and cloud investments. Recent collaborations include exclusive agreements and partnerships with payroll processors, adding millions of records. These efforts have bolstered their service offerings and contributed to a 10% increase in records, highlighting the positive impact on their growth trajectory.

"Joe Muchnick is the leader who's driving that. And I think we made that change in December and you've seen just the ability to just drive more of those strategic partnerships, which has really been quite positive. It is broad-based." --- (EFX, earning call, 2024/Q2)

"Our records were up 10%, both direct and partner in the Q1 in total. And we've got a I think we shared we added a couple of big partners in the Q1 that are coming online, one of them larger in the Q2 because of our cloud investment." --- (EFX, conference, 2024/06/05)

"And then using the example we talked about, we signed 2 more exclusive partnerships in the Q1 for record additions in EWS, one of those large and we spiked it out being 6,000,000 records, which is a bigger partner." --- (EFX, conference, 2024/05/07)

"So there’s a very strong relationship there. And as you may know, beyond just income employment with partners like payroll processors, we’re increasingly doing our other services like I-9 unemployment claims and WOTC in partnership with those kind of companies." --- (EFX, earning call, 2024/Q1)

"As you know, we added four partnerships in the fourth quarter. We added a bunch last year, but those four coming on in the first half of the year, and then landing this largest payroll processor with 6 million records, that's a lot of records to add." --- (EFX, earning call, 2024/Q1)

Competitive Positioning

Equifax is enhancing its competitive positioning by encouraging lenders to modernize their prospecting and leveraging alternative data within Provenir’s risk decisioning platform, providing simplified, one-click access to gain a competitive edge.

"To stay competitive, #lenders need to make the leap and explore new ways to modernize their prospecting." --- (EFX, Twitter, 2024/05/31)

"Say yes often to more consumers. Having simplified, one-click access to Equifax #AlternativeData within Provenir’s risk decisioning platform will give you a competitive edge to focus on forward. https://t.co/Ka1m87n1Yr https://t.co/Y4pIUN3xwo" --- (EFX, Twitter, 2024/06/19)