Where Fair Isaac's Growth Could Come From Next

Key Points

• The core credit scoring business is stable and growing.

• The FICO platform is becoming a meaningful revenue driver beyond scores.

• Going global is another significant growth opportunity.

• 10 stocks we like better than Fair Isaac ›

Fair Isaac (NYSE: FICO) isn't a company that makes daily headlines, but its products quietly shape one of the most essential parts of the U.S. economy: credit. Best known for its FICO score, the company has built a reputation as the standard for consumer creditworthiness.

Yet beyond its credit-scoring business, Fair Isaac is leaning into a broader transformation -- one that could drive meaningful growth over the next few years.

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Here are three growth opportunities investors should watch.

Image source: Getty Images.

1. The core engine is still going strong

Let's start with the obvious and the most profitable business: credit scoring. The FICO score remains Fair Isaac's most recognized asset, and it continues to generate reliable, high-margin revenue. Every time a lender checks a score, the company earns a fee. With more than 90% of top U.S. lenders using FICO, this franchise has near-monopoly status.

The strength of this business is evident in the company's latest figures. In Q3 2025 (the quarter ended June 30), revenue from the scoring business grew by 34% year over year. That's just part of the story. What's more impressive is that this business has a remarkably high operating margin of 88%, highlighting the strength of its business model.

This business can steadily grow while maintaining its margin, partly due to the increase in demand for its scoring, but also due to a far less discussed attribute of its business model: pricing power. Banks, credit card issuers, mortgage lenders, and auto financiers use FICO scores as a trusted, standardized way to judge borrower risk. And because regulators, investors, and secondary markets (like mortgage securitization) expect FICO-based risk assessments, lenders can't just swap to an alternative without facing credibility and compliance issues.

In other words, FICO sits in a tollbooth position. As long as Americans keep borrowing (whether for homes, cars, or credit cards), FICO collects a fee on each underwriting decision.

2. Expanding the software business

While scoring is clearly the bread and butter of Fair Isaac's business model, the company is also increasingly diversifying into other areas to sustain its growth ambition.

One of these opportunities lies in FICO Platform, the company's cloud-based decision management SaaS software. This product enables banks and enterprises to automate customer interactions, from loan approvals to fraud detection to marketing personalization. FICO has positioned this as its "second act," aiming to become the operating system for financial decision-making.

FICO believes its platform opportunity is vast, even as penetration remains in early stages. CEO Will Lansing said the company has reached less than half of the top 300 global financial institutions with its enterprise platform, underlining how much headroom remains. While it's early days, the company's financials support this optimism -- platform-based software revenue has been growing at double-digit rates in the last eight quarters.

Besides, the traditional non-platform software segment continues to generate solid cash flow. This business is likely to slowly transition to platform-based over time as customers adopt the new and more enhanced solutions to meet their decision-making requirements.

3. Going global

Another often-overlooked growth opportunity for Fair Isaac is expanding its presence in overseas markets. While the U.S. remains its core market for now (and probably the foreseeable future), demand for credit analytics is growing in emerging markets as consumer lending systems mature.

FICO can roll out its scoring system quickly for banks or credit bureaus, and the real advantage is that it works even in countries where credit data is patchy or incomplete. That flexibility means FICO isn't limited to mature markets like the U.S.--it can expand into emerging economies too, where lending systems are still developing.

The company has already partnered with financial institutions abroad to expand the adoption of its products, given its long-term presence in 40 countries over the last 30 years. Over time, this global push could diversify revenue streams and reduce dependence on the U.S. credit cycle.

What does it mean for investors?

FICO stands at a compelling inflection point. The company's legacy FICO Score continues to power significant revenue. Meanwhile, its push into analytics platforms and global market expansion opens multiple new growth horizons.

Long-term investors who see beyond the "credit score" can view FICO as both a dependable earnings engine and an evolving growth business.

Either way, the stock is worth adding to investors' radar.

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Lawrence Nga has no position in any of the stocks mentioned. The Motley Fool recommends Fair Isaac. The Motley Fool has a disclosure policy.