Equifax reported a significant increase in first-quarter profit on Tuesday, driven by higher loan demand within its U.S. mortgage business. The company also reaffirmed its full-year revenue outlook, despite acknowledging macroeconomic uncertainties.
Equifax shares experienced a slight increase, rising 0.5 per cent in premarket trading following the release of the financial results.
First Quarter Financial Performance
Loan demand has recently increased after a period of stagnation linked to elevated interest rates. This resurgence is supported by a robust labor market and a generally stable economic climate. Increased lending activity has subsequently boosted the demand for credit scores and risk analytics, benefiting companies like Equifax.
Equifax’s revenue for the quarter rose 14 per cent to US$1.65 billion. Net income attributable to the company increased 29 per cent to US$171.5 million for the three months ending March 31. Quarterly profit per share reached US$1.42, compared to US$1.06 in the previous year. The company attributed the revenue outperformance primarily to a 38 per cent increase in U.S. Mortgage revenue, particularly during January and February, before interest rates rose due to the Iran conflict.
Macroeconomic Factors and Outlook
CEO Mark Begor stated that Equifax is maintaining its revenue forecast despite the strong quarterly results. This decision is influenced by a decrease in U.S. mortgage activity resulting from higher interest rates following the commencement of the Iran conflict.
The global macroeconomic environment, along with the direction of U.S. inflation and interest rates, also contributes to the ongoing uncertainty. The situation in the Middle East has complicated the interest rate outlook, as rising oil and gas prices pose a risk of increased inflation and potentially impact the U.S. Federal Reserve’s plans for reducing benchmark lending rates.
Credit scores play a crucial role in the financial system, used to evaluate borrower risk and influence decisions related to mortgages, credit cards, auto loans, and personal loans. These scores also affect interest rates, credit limits, and loan approvals.
Equifax confirmed it is maintaining its full-year 2026 guidance midpoint for local-currency revenue growth of approximately 10 per cent.
