FICO faced a sharp and unprecedented stock decline in May 2025, losing more than $11 billion in market capitalization over just five trading days amid mounting regulatory scrutiny and concerns over its pricing strategies. This substantial market reaction prompted FICO to announce a $1 billion share repurchase program. While this buyback constitutes only 2% of its market cap, it is worth examining what lead to this share repurchase announcement.
Fair Isaac Corporation (FICO), founded in 1956, is a global leader in analytics software, best known for its FICO Scores, used by 90% of top U.S. lenders to assess credit risk. These scores, ranging from 300 to 850, summarize a consumer’s credit history and predict the likelihood of timely loan repayment. Developed nearly 30 years ago in partnership with major credit bureaus—Equifax, TransUnion, and Experian, FICO Scores became the industry standard for evaluating creditworthiness.