Good day, and thank you for standing by. Welcome to the FactSet Third Quarter Earnings Call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question- and- answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Kevin Toomey, Head of Investor Relations. Please go ahead. Thank you, and good morning, everyone. Welcome to FactSet's third quarter fiscal 2026 earnings call. Before we begin, the slides we reference during this presentation can be found through the webcast on the Investor Relations section of our website at factset.com. A replay of today's call will be available on our website. After our prepared remarks, we will open the call to questions. The call is scheduled to last for one hour. To be fair to everyone, please limit yourself to one question. You may re-enter the queue for additional follow-up questions, which we will take if time permits. Before we discuss our results, I encourage all listeners to review the legal notice on slide two. Discussions on this call may contain forward-looking statements. Such statements are subject to risks and uncertainties that may cause actual results to differ materially from results anticipated in these forward-looking statements. Additional information concerning these risks and uncertainties can be found in our Forms 10-K and 10-Q. Our slide presentation and discussions on this call will include certain non-GAAP financial measures. For such measures, reconciliations to the most directly comparable GAAP measures are in the appendix to the presentation and in our earnings release issued earlier today, both of which can be found on our website at investor.factset.com. During this call, unless otherwise noted, relative performance metrics reflect changes as compared to the respective fiscal 2025 period. Joining me today are Sanoke Viswanathan, Chief Executive Officer, and Josh Warren, Chief Financial Officer. I will now turn the discussion over to Sanoke. Thank you, Kevin. Good morning, everybody, and thank you for joining the call. Q3 performance was strong with our fifth consecutive quarter of acceleration in organic ASV growth. We grew ASV by 7.1% to $2.48 billion across all regions and client types. Adjusted operating margin was 34%, reflecting the investments that we've made this year. Adjusted diluted EPS was $4.53, up 6.1% year-over-year. Our client engagement and growth trends this quarter show that our four foundational strengths of connected data, embedded workflows, service excellence, and broad and deep distribution are becoming even more valuable as our clients deploy AI widely. Five example client wins from this quarter demonstrate the breadth and depth of our solutions and the tangible impact of strategic investments we've made in new products such as Managed Portfolio Services, deep sector content, and real-time data. We won a mandate to deliver turnkey performance, risk, and reporting managed services to one of the largest global sovereign wealth funds. We expanded our engagement with a large global OCIO to provide comprehensive reporting and digital capabilities wrapped with managed services from our subject matter experts. We signed a five-year enterprise contract renewal at a major global bank. The scope has increased to include more data consumption with deep sector content playing a key role. LPL Financial, the largest independent broker-dealer in the U.S. that supports over 32,000 financial advisors, selected our real-time data platform to support their cloud-native trading application and intra-day portfolio P&L workflows. We displaced a long-standing incumbent to expand our presence at a large global investment manager across their front and middle office. Already a top 20 client seeking to further consolidate their operations with FactSet. Each of these five wins represents an existing client expanding their relationship with FactSet, underscoring meaningful room to grow within our current relationships. Last quarter, I shared the three priorities guiding a transformation in how we do business. Commercial excellence, productivity improvement, and long-term strategy. This quarter shows tangible commercial and productivity outcomes and our AI roadmap taking shape consistent with our strategy. First, the commercial excellence initiative is resulting in stronger new business growth, retention, and expansion of ASV. As we roll out better tools, increase conversion at every step, and streamline our processes in marketing, sales, and customer success, we are seeing improvement throughout the sales life cycle. Our new website resulted in more top-of-funnel demand generation. Bounce rates improved by 8%, engagement increased by 8%, and prospects, marketing qualified leads, and sales qualified leads grew by double digits. In Q3, our pipeline conversion from marketing activity increased 15% year-over-year, and win rates for these opportunities improved by 27%, with 76% of the resulting ASV coming from new business. The corporates, asset owners, and institutional asset management client types were particularly strong. We are rolling out a new AI-powered sales enablement platform to our entire team, targeted at improving the quality of our sales pitches, increasing deal velocity, and improving win rates. Beyond these traditional levers, we are transforming our model for retention and expansion as our clients adopt AI. Q3 was the fourth consecutive quarter of double-digit growth in ASV for our data solutions, with MCP contributing to the momentum. Over 90% of our top 50 clients are now using four or more FactSet AI solutions. Quarter-over-quarter, overall ASV growth among clients using our AI solutions was 50% higher than for the rest of the book. Early evidence that our AI adoption is helping drive retention and expansion opportunities. The AI transition is also accelerating the shift of our business model from seat-linked contracts to flexible enterprise agreements that encompass our growing data analytics and workflow capabilities. The majority of ASV renewed in Q3 was in the form of enterprise agreements or renewed for durations of three years or more. Average contract term extended by roughly 30%, while broadly preserving pricing, underscoring the foundational value attributed to FactSet by our clients as they adopt AI. Second, we are rolling out AI agents, streamlining operations, and reducing complexity to generate sustainable productivity improvements and operating leverage. Let me highlight a few examples in engineering, data operations, and client service, our three largest operating cost centers. In Q3, we scaled AI use across our product and engineering teams. Coding-related token use grew 5x quarter-over-quarter, while committed lines of AI-written code grew almost 10 x. Coding agents now author 27% of committed code in the engineering teams using these tools, with rollout continuing across the organization. With these efficiency gains, we initiated a roughly 10% reduction in our technology workforce and freed up significant capacity to accelerate strategic product development. We are embedding AI across the full data operations life cycle, from collection through quality assurance. Where we have fully implemented new tools, we have reduced operator touch time for data table extraction by more than 50%. We are now scaling this playbook with clear goals to improve quality, timeliness, and unit cost. In M&A data, we have dramatically reduced turnaround time for deal updates. Within FactSet Fundamentals, one of our largest data sets, we've consolidated multiple data pipelines into one, allowing us to redeploy significant capacity and reduce the size of this team by 5%. Our client service teams are seeing early positive results from digitization pilots we are running. These reduce the need for manual onboarding activities from our consultants, enabling them to spend more time on strategic user health and retention efforts. In Q3, approximately 4,000 bankers used our digital onboarding tools, and the capacity unlocked resulted in a 22% quarter-over-quarter increase in live user interactions by our consultants. This helped drive a 5-point increase in Net Promoter Score among our junior banker population in Q3, building on the momentum from last quarter. We are in the early stages of these efforts, but together, they are aimed at a structural reduction in our cost to serve while improving overall quality. As we realize the full impact of these productivity initiatives, we expect to see further scale benefits and operating margin improvement. We are developing our strategy based on a strong foundation of connected data, embedded workflows, service excellence, and deep and broad distribution. These strengths make FactSet a trusted governed platform for institutional finance and are even more important to our clients as they make their AI transition. As a starting point for our clients, we have launched our AI solutions under the banner of FactSet Intelligence. It consists of three layers that accelerate our clients' AI adoption, a trusted data ecosystem, governed and optimized agentic infrastructure, and intelligent workflows built for hybrid workforces. A trusted data ecosystem including FactSet, client, and third-party data. Data is the fuel for AI and has to be high grade to provide the right quality output. FactSet's MCP server, built on a robust ecosystem of content APIs, has over 450 clients actively engaged under contracts and trials. API call volume is experiencing rapid growth, with Q3 volumes at 13 x the level we experienced in Q2. We expect this to continue as we make more data sets available through MCP. Clients can now access our data through all major frontier lab platforms, including Anthropic, OpenAI, Google, and Microsoft. Our MCP enables access to high-quality, comprehensive, and auditable data sets presented through the same endpoints used by our own developers. The quality of our data delivery through MCP is driving expansion at clients where we're already embedded in high-value workflows. For example, we launched our Portfolio Analytics MCP just last week, bringing our signature Portfolio Analytics into agentic workflows. Portfolio Analytics has long been central to how our buy-side clients measure performance, manage risk, and meet reporting obligations, and we believe we will unlock significant value for clients by extending these capabilities to agentic use. We are also extending our AI solutions in the data layer to client internal data and third-party data. FactSet's unique strengths in entity resolution, ontology, and concordance in partnership with Snowflake, Databricks, Google, and AWS, position us well to help clients build out their enterprise knowledge graphs. Second, FactSet has governed and optimized agentic infrastructure. Our clients want to curate and optimize multiple horizontal and vertical AI solutions. To meet this demand, we are rapidly rolling out infrastructure to become the integrated agentic platform for our clients. We already support millions of models and billions of formulas and data points across the nearly 250,000 users of our workstations every day. Users can discover our agents, soon build, test, and publish their own agents, and even integrate third-party agents, all while maintaining the security standards, data entitlements, audit logs, and cost optimization that clients expect and get every day from FactSet. While the user interface may very well evolve as agentic workloads take off, we are confident in the value we deliver to our clients and are already seeing significant client interest in rationalizing various experimental efforts and consolidating their AI implementations with us. Third, intelligent workflows for hybrid workforces. As we roll out agentic capabilities, we are working closely with clients to redefine how they get work done with a hybrid workforce of humans and agents. Through the partnership we announced with Finster in March, we've launched a fundamental transformation in investment banking workflows with our Capital Markets Intelligence suite of agents. Senior bankers can now send an email to an agent describing what they need and receive insights and artifacts directly. Built on current FactSet data, comparable company analysis, and deal precedents automatically generated and delivered back. What used to take hours or days now happens in minutes, freeing up capacity for higher-value client workflows and interactions. We are seeing strong early engagement with active or pipeline trials at over 30 of our top 100 banking clients. We will roll out similar capabilities to our buy-side and wealth clients in the coming weeks with our Institutional Research Intelligence and Advisor Intelligence product suites. We announced strategic partnerships with InSync Analytics, Genios AI, and TIFIN.AI to advance these capabilities and supplement our internal agent development roadmap. Across all layers of FactSet Intelligence, we see significant growth opportunity as our clients consume more data through many new channels, consolidate their agentic deployments with us, and reimagine their workflows with our agentic solutions. To further accelerate our product innovation, we announced a strategic partnership with Google Cloud this week, expanding our distribution through Google Cloud's enterprise channels and unlocking new revenue opportunities. The partnership will focus on three main areas. Enhancing FactSet's workstation with Google's Enterprise Search, Deep Research API, Grounding, and other multimodal capabilities using Google Cloud's AI platform. These capabilities will supplement FactSet's trusted and connected data and analytics and improve the breadth and depth of our AI-enhanced insights. FactSet will bring our financial intelligence directly into Gemini Enterprise and expand our MCP and agent-sharing functionalities, creating interoperability between the FactSet workstation and Gemini Enterprise. This builds on the previously announced DeepMind Deep Research collaboration. FactSet will also develop and launch a new generation of agents using the Gemini Enterprise agent platform designed to improve efficiency, execution, and decision-making across key client workflows. As AI reshapes financial institutions, FactSet is becoming mission-critical AI infrastructure. We are transforming our business model to win in an AI-intensive future. We look forward to sharing our strategy and medium-term business plan at our upcoming Investor Day. I'd like to now welcome Josh Warren to FactSet. Congratulations, Josh, on your first earnings call as CFO of FactSet. He will now discuss our Q3 performance in more detail. Thank you, Sanoke. It's great to be here with everyone this morning. Before getting into the financials, I want to take this opportunity to thank all the FactSetters who have made me feel so welcome since I joined in April. I would also like to specifically recognize Helen Shan, whose leadership over the last eight years as CFO and Chief Revenue Officer has put FactSet on firm footing as we embark on a new chapter. This week marks the 30th anniversary of FactSet's IPO, and I'm excited to join the firm at this moment. As AI and agents reshape how information is sourced, synthesized, and acted upon, FactSet is positioned for durable structural growth that can deliver excellent outcomes for our clients, employees, and shareholders. In our results, I'll highlight three things. First, our client franchise. Its quality, breadth, and durability reinforce our financial profile. Next, our operating leverage. Finally, our flexible balance sheet and disciplined capital allocation, which support our go-forward strategy. Expanding our client relationships drove this quarter's results, which I would like to recap. As of the close of fiscal Q3 at the end of May, our ASV exceeded $2.48 billion, representing 7.1% organic growth, an acceleration by more than 250 basis points over the comparable growth rate in 2025. Revenue was $622.9 million, representing 6.4% growth over the previous year. Our adjusted operating income was $211.8 million, representing a 34% margin, down approximately 300 basis points relative to the comparable quarter in 2025 due to targeted investments to improve operating leverage, marketing and performance-related compensation linked to ASV momentum. Adjusted EPS grew 6.1% to $4.53. FactSet serves clients across over 80 countries, including 95 of the top 100 asset managers, more than 85% of the top 50 global investment banks, and the world's top wealth managers, corporations, exchanges, central banks, and sovereign wealth funds. This breadth gives FactSet meaningful exposure to all major geographies and client types in the financial services industry, so we are not dependent on any single market or segment, while providing a substantial opportunity to expand wallet share within our current clients. With an average client relationship spanning more than 16 years and nine of our top 10 clients measured by ASV having been with us for more than two decades, we grow with our clients, and our longest-standing relationships have some of the most exciting opportunities for growth. ASV retention rates above 95% reflect the strength of our client relationships. Those relationships fuel our ASV bookings growth that provides a line of sight into future revenue. As of last year, ASV no longer includes one-time non-recurring revenue, such as professional services. Our approach is to embed flexibility within enterprise agreements and, importantly, secure minimum commitments. These minimums give us a baseline so that we can support new consumption patterns and be rewarded for the value we deliver while preserving the forward visibility that we expect will remain central to our financial model as we deliver more AI solutions to our clients. Today, most of our recurring revenue comes from fixed subscription and license revenue. A growing portion of our recurring revenue streams are driven by initiatives that are activity-based, including workflows that are increasingly mission-critical for clients. We are seeing more client interest in consumption-oriented pricing, particularly for emerging AI-enabled offerings. While modest in size today compared to our total ASV, we expect these revenue streams to become an increasingly important driver of our growth over time. These revenue streams introduce a dynamic and growth-oriented dimension to ASV forecasting and subsequent revenue flow-through that complements the traditional subscription base. As our delivery model evolves alongside our clients, we expect to review our approach to reporting to preserve transparency and alignment with our go-forward strategy. Our organic ASV is a like-for-like comparison that excludes the impact of foreign exchange, discontinued business lines, and acquisitions that closed within the last 12 months. For the third quarter, organic ASV accelerated to 7.1% year-over-year, an increase of $35 million during the quarter, FactSet's highest ASV growth rate since Q1 2024. Growth was evident across all regions and client types as the world's leading financial services firms continue to choose FactSet as a trusted partner. Turning to our performance by geography, organic ASV accelerated in each region compared to the prior year. Americas grew 7%, EMEA grew 5%, and Asia Pacific, our fastest-growing region, grew 10%. Turning to our results by client type. The institutional buy- side, consisting of global asset managers, asset owners, and hedge funds, accelerated to 6% organic ASV growth. This represents slightly less than half of our overall ASV. Wealth remains our fastest-growing category and delivered 10% organic ASV growth. Organic ASV for dealmakers grew 9%. This category represents a broad range of clients, including investment banks, sell-side research teams, corporates, and private capital firms. Today, this represents nearly 40% of clients and less than 20% of ASV. Though smaller in size, our strategically important market infrastructure category saw organic ASV grow 7%. Demonstrating strength across the platform, third-quarter revenues grew 6.4% year-over-year, or 7% on a like-for-like basis. Adjusted operating margin was 34% for the quarter as compared to 35% in Q2 and nearly 37% a year ago. This reflects a series of deliberate investments that we expect to deliver growth and operating leverage over time. Compensation-related expenses typically account for approximately 60% of our total cost base. Our Q3 margin reflects a 7% year-over-year increase in compensation-related expenses that were driven by performance incentives linked to the ASV acceleration delivered, not additional headcount. Because revenue from new ASV bookings is recognized over time, periods of faster ASV acceleration can temporarily compress margins in any quarter since the incremental ASV is not yet reflected in revenue. We will remain long-term focused and optimized for profitable growth. Despite the increased overall compensation expense during Q3, FactSet reduced its overall headcount by approximately 1% after holding it roughly flat during the first half of the year. While compensation-related expenses accounted for approximately 40% of the increase in operating expenses, the majority of the year-over-year growth came from non-compensation items tied to growth and productivity initiatives. More than a third of that non-compensation expense increase was technology spending, including to strengthen our core infrastructure and on- token costs. We increased our marketing spending and have a variety of professional services engagements underway to drive future operating leverage. Margin this quarter was also negatively impacted by non-operational items, such as our FX hedging program, which went from a gain in Q3 2025 to a loss in Q3 2026, creating an overall drag of approximately 60 basis points. Our earnings per share increased 6% year-over-year to $4.53. This was driven by a higher revenue and a lower share count, partially offset by increased expenses and a higher effective tax rate. While we continue to drive ASV growth, we're focused on capitalizing on our scale to deliver long-term sustainable and profitable growth. To that end, we've launched a range of strategic projects aimed at running FactSet with greater discipline and efficiency. Sanoke outlined multiple productivity initiatives, but from an operational standpoint, I'll highlight two items we initiated during Q3 and completed in the past few weeks. We recently right-sized certain engineering teams as we standardize how we build and run software and take advantage of AI-assisted coding. Additionally, we entered into an arrangement with RepRisk to support our clients' needs as we discontinued the Signals Attribution Service FactSet provided following the 2020 acquisition of Truvalue Labs. We are continuing to review our product portfolio against appropriate hurdle rates, and while we expect to make additional efficiency improvements, our focus and our investments will remain on serving our clients with excellence. Consistent long-term free cash flow generation is a hallmark of our business model and a metric we actively manage towards. Our free cash flow grew to $254 million for the third quarter of fiscal 2026, compared with $228 million for the prior period, an increase of 11%. Our discipline framework prioritizes organic investments in high-growth projects, followed by strategic inorganic activity, and finally, returning excess capital to shareholders. During Q3, we accelerated our repurchase activity, buying back approximately 926,000 shares for $203 million. Fiscal year-to-date, we've deployed over $500 million to repurchase shares. Additionally, we increased our quarterly dividend for the 27th consecutive year. In total, during fiscal 2026 year-to-date, we have returned over $625 million to shareholders through a combination of dividends and repurchases, approximately double the amount returned over the same period last year, demonstrating our continued commitment to delivering shareholder value. Overall, we are committed to maintaining our investment-grade rating, which Fitch reaffirmed with a stable outlook this quarter. We continue to assess opportunities about optimizing our debt maturity profile to align with our strategy. Our balance sheet continues to strengthen with a conservative level of gross debt leverage at 1.5x and net debt leverage at 1.2 x, providing capacity and flexibility to support growth. Turning to our outlook, we remain confident in the guidance ranges that were previously set for ASV, revenue, operating margin, and EPS. On revenue and EPS in particular, we are tracking toward the high end of those ranges based on our business trajectory. We are pleased with our accelerating ASV growth, and our focus remains firmly on delivering long-term value for our clients and shareholders. During my first 10 weeks here, I've seen that when clients are thinking through and making big decisions about the data powering their platforms, they turn to FactSet as a partner. Our open architecture and partnership-oriented approach positions us to deliver excellence to our clients and compounding growth for our shareholders. With that, I'll hand it to the operator to open the line for questions. Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. We ask that you please limit yourself to one question. Please stand by while we compile the Q&A roster. Our first question comes from the line of Ashish Sabadra with RBC Capital Markets. Your line is now open. Thanks for taking my question. A really strong momentum on ASV, and seems pretty broad-based. As we look at the guidance, the guidance implies a moderation in the fourth quarter. Just wanted to better understand, is that just purely conservatism, tougher comps, or are there any inputs and takes that you could flag? Thank you. Thanks, Ashish. As you've noted, I think it's been a really strong quarter, and in fact, the momentum continues into Q4. Just a month into the quarter, we see that momentum has continued. We continue to see a strong, diverse pipeline of clients. It's broad based, it's across regions, and it's across all of the different client types, and it continues to maintain that growth trajectory that we've seen. It is a tough compare. Just to remind everybody, Q4 of last year was our largest quarter ever, and it is a tough compare. As we stand today, at the end of June, early July, we are ahead of last year in terms of our bookings, and we also see a pipeline that is as robust as we saw at this time last year. AI is a tailwind for us, that is also helping us. In terms of reaffirming guidance, we don't change guidance quarter to quarter, there is a lot to execute ahead of us. There are multiple seven-figure deals outstanding, it will be all down to execution in the next eight weeks, there could be a timing issue there. The second thing is, a lot of tons of mid-market deals, which we are actually quite excited about because they are faster to close, AI is very dynamic. With that, I think we are reaffirming the guidance and reasserting that we are very confident in our delivery. Thank you. Our next question comes from the line of Faiza Alwy with Deutsche Bank. Your line is now open Yes. Hi, good morning. Thank you so much. I wanted to talk a little bit more about your AI monetization strategy. Thanks for a lot of the detail that you provided that 90% of your top 50 clients use four- plus AI products and 50% faster ASV growth. Just give us some context around that and just the monetization around that. Is it because there's a direct price for the usage of AI? Is it access to more datasets? You also talked about a lot of your clients consolidating their AI workflows with you. Are you agnostic as it relates to whether they're using your MCPs or whether they're using your specific tools that are inside FactSet workstation? Sorry, long-winded question, just would love more context there. Thank you. Thank you, Faiza. Lots of questions in there. We'll take a little bit of time to answer that, because there is a lot of color in here that we can share. Maybe I'll start first with the short-term picture on AI monetization and then transition to how we see this in the longer term. At the moment, I think we are maximizing our AI monetization with the lens of maximizing enterprise value. It's all leading to the growth acceleration in ASV, our increased retention, as well as expansion in our existing clients. Just to give you a little bit of color, just in this quarter, we saw over 10% of the ASV growth came directly from AI SKUs. Obviously, there was a much bigger impact than that in the broader ASV growth as well. Just to give you a couple of client examples, we had one of the top 10 banks literally double their data subscriptions with us because of AI, and these are multi-year contracts. A top hedge fund grew 6x with us, again, because of our MCP delivery. At this point, over 20% of our top 100 clients are using MCP on a paid basis. Right? These are just some short-term statistics giving you the momentum that we are seeing. When we think more longer term, and as you referenced, I think we see multiple opportunities, and we see AI as a massive tailwind. To start with, there's been lots of questions about what are our moats, and we are really now starting to see this in evidence, right? It's no longer a theory. We have a strong moat in our connected data and in our embedded workflows. We see this as a leapfrog moment for us on a stable subscription base. Our whole data solutions business that historically delivered standard data feeds, APIs, and also sharing on environments like Snowflake and Databricks, is perfectly set up for this, right? With ASV coming through on AI, we see us shipping faster, and we are able to flex all of this into commercial agreements that are not just seat linked, but are true enterprise agreements that has a stable, large subscription base and a flexible construct on top of that, which allows us to capture the upside in the future from consumption basis. That's a little bit of color on the short term and the medium term, and happy to take any further questions on this. Hopefully, you can see the momentum is picking up. Thank you. Our next question comes from the line of Alex Kramm with UBS. Your line is now open. All right. Hey, good morning, everyone. I guess I need to switch over to margins for a second here. I think previously you made some comments in your guidance, and I don't think you made them today, but that you are actually hoping to get somewhat close to the midpoint of your adjusted operating margin guide. Just wondering, with some of the things you've done, some of the things that are a little bit more one time, like that FX hedge, is that still what you're shooting for, or what are the upsides and downsides to that? I know you're not going to give guidance for next year, but maybe you can just remind us. I think there are a few things this year that are somewhat one-timers, professional services, some infrastructure investments that you had tagged for this year. Just remind us what of those one-timers items comes out as we head into 2027 and dimensionalize those, please. Thank you. Thanks, Alex. Yes, as you noted, we came in this quarter, the 34% adjusted operating margin. That reflects a combination of things. It reflects the strong investments that we've been making throughout the year, and as we've said in prior quarters, those are second-half weighted. You saw the effect of that in the quarter. And the performance incentives we are accruing, given the ASV outperformance. We're very happy with the pace of the investments. We are seeing really strong progress both on the growth-oriented investments and in the foundational investments, both of which we see starting to deliver operating leverage. As you know, we don't manage to a quarterly margin, and we don't guide to a quarterly margin. We see significant acceleration in AI and continued opportunities for investment, and we'll continue to entertain high ROI investment opportunities as they come along. With all that said, what I would clearly say is we see a clear line of sight now on margin improvement coming up in the future quarters. That includes some of the things you mentioned, right? We are still clearly for this year focusing on the midpoint of the guide. Right? We still have confidence in that, and we are seeing line of sight from all of these initiatives that we think will lead to margin improvement in the coming quarters. I'll ask Josh to build on that and give a little bit more color on the puts and takes for this quarter and going forward. Sure. Thanks, Alex. Really appreciate the question. Nice to hear from you. Just to Sanoke's point, just on the puts and takes. The biggest single item, and really frankly the main dynamic in the quarter is timing, specifically around pay-for-performance arrangements, not headcount growth. Compensation-related expenses was the single biggest item in terms of our increased expenses. When we start to look at the other items, technology spending is our second biggest category. That's a combination of things, including our increased focus on our core infrastructure, programs related to cybersecurity, ITDR, and also our token spending. Our token spending has increased year-over-year, and Sanoke mentioned some of the return that we're seeing on our token spending. With regard to the other category, as you may observe, there's a series of other initiatives that we have in flight. We increased our marketing spending. We have professional services arrangements. What I would say looking forward, taking all of that into the soup as the past. Looking forward, we see a clear path to expanding our margins. Part of what we're looking forward to is continuing the momentum that we see in the business, and that momentum, ultimately, we feel will position us well, both on the top line and on our margins. Thank you. Our next question comes from the line of Kelsey Zhu with Autonomous. Your line is now open. Good morning. Thanks for taking my question, and welcome to the call, Josh. A lot of info services companies have talked about this trend of AI implementation driving accelerated data demands. I was wondering if you can talk a little bit more about FactSet's strategy to monetize on this trend, both near term and long term. In relation to this, how should we think about the incremental revenue opportunities brought by MCP? Especially in the past, you called out some expansion of new user persona, and I was wondering if you can tell us a little bit more about that. Thanks a lot. Sure, Kelsey. Some of it I just covered, I think, in my discussion around AI. Just to repeat that. The short-term monetization we see is an acceleration in our ASV growth. Clearly, MCP is a real accelerant. We see whenever there are deals that involve an MCP component, more often than not, and I would say 90% of the time, we've seen contract value improvements. At the moment, it's playing out in the overall broad ASV acceleration. As we go along, we are going to see more and more discrete AI SKUs, and as I said, more than 10% of the ASV, even this quarter, came from that. Again, it's too early to draw a trend line from that, but that was from virtually zero last year, and it's certainly growing. In terms of your question around user personas, yes, that continues. I think even today of our MCP trials as well as our MCP paid implementations, around 20% of the users of our endpoints are net new users, whether they might be in existing clients or at new clients, but they are net new users. These are new workflows and new workloads that are coming on thanks to our ability to deliver data to new AI workloads. Just to remind everybody, we are also available on all the different frontier lab marketplaces as first-class data connectors, and that enables this easy discovery, connectivity, and also growing uses. The last thing I would add is an important and key indicator for us is how does this translate into broader growth in our product suite and product penetration? From what we've seen so far in the last six months, whenever there is AI consumption through MCP, it is actually leading to an upsizing of our existing products, whether they are workstations, whether they are other APIs, whether they are other standard data feeds. There is a multiplier effect on the existing business as well. If you recollect, a couple of quarters ago, I spoke about the AI flywheel effect. It is still very early stages, but we are starting to see that in action. Thank you. Our next question comes from the line of Manav Patnaik with Barclays. Your line is now open. Thank you. Good morning. I just wanted to understand the partnership strategy and maybe just part of broader capital allocation as well. I understand all the frontier lab partnerships, but a bunch of these other ones that you've announced, which we're not too familiar with. Just trying to understand the pipeline of what that list looks like, and whether these are step one into potentially making some of these deals, or is that not the way I should think about this? Thanks, Manav. You've spotted the diversity of partnerships that we've struck. It's a deliberate strategy. It is consistent with how we've thought about our network and ecosystem historically. As you know, we've always been open architecture. Typically any M&A we've done, we've had a history of connecting it with other partners that we've actually worked with, and we have the experience. There is a clear understanding of the value creation potential, et cetera. In this cycle, we are very focused on three things, which connects back to what I described earlier in my prepared remarks on FactSet Intelligence. Across each of those three layers that we described, there is a lot to be done, both at our end, at our clients' end, and in terms of integrating the whole ecosystem. At the data layer, there is a number of initiatives underway to help clients advance their data meshes and to build these enterprise knowledge graphs, which requires us to partner with firms like Snowflake and Databricks and the like. Similarly, some of the partnerships that you see at the top of that slide, which are the recent ones that we've announced, those help us really accelerate the agentic workflows that we are building that are very focused on user personas, whether it's on the buy side or in wealth management. The Google partnership we announced cuts across the whole page, really, because we get a lot of benefits from it immediately. A, in the FactSet workstation, we can infuse Gemini everywhere. We can get the benefits of early releases of the most advanced frontier models. We get the ability to get cheaper tokens usage because we get the preferential pricing as part of this contract, and we benefit from better infrastructure and joint product development and innovation. The idea is that we are accelerating product development. We are being very prudent in our capital allocation, which Josh will get into in a second. We are working very actively to ensure that we are staying at the cutting edge of the market and actually leading the market in many ways as our clients make this AI transition. Maybe Josh, you want to comment a bit more on capital allocation? What I would add to, Sanoke, what I'd add to that is, we're very focused, Manav, on operational execution. Our capital allocation framework provides really a roadmap to value creation. Specifically what that means is prioritizing the investments that offer the highest risk-adjusted returns. We're very focused on investing in growth. Investing in growth means building out the products and solutions that we deliver to our clients. Then beyond that, we consider all excess uses of free cash flow, whether it's return of capital to shareholders in the forms of buybacks or dividends, or you asked about M&A or our partnership strategy in particular. On that, what I would say, just to augment what Sanoke outlined is, we intend to be very surgical in terms of how we are approaching our acquisition philosophy. We are at the heart of a robust ecosystem of partners that we work with. Our approach is really going to be focused on the areas of highest and greatest impact. What is really exciting for me in particular, and for all of us at FactSet is because of FactSet's open architecture approach, and because we operate in this rich ecosystem, a lot of our inorganic activity, we expect to be de-risked. Right? We are already likely having a technology integration or a client integration with a particular partner that we would work with. You should expect a pipeline that flows from a lot of the day-to-day execution activity that we are engaged in. Thank you. Our next question comes from the line of Shlomo Rosenbaum with Stifel. Your line is now open. Hi. Thank you very much. I want to ask a little bit about the commentary about the 3Q 2026 renewals extended the length of contracts by 30% on average. Just want to get a little bit more color in terms of are you trading anything like price to get an extended term? Then also just with the evolving kind of monetization model, is there any risk of locking yourself into something that might not be ideal a couple of years down the line? Actually, it's interesting that clients are interested in going out that far, given that the models are evolving, and I was wondering what the feedback is from that. Do you think that you may have to open up these contracts later on if something kind of changes? If you can just give a little bit of color on that. Then just Josh, first of all, I guess welcome to the company and the call. Noting that not reporting client count, user count, and employee count, is that something that you feel is just less relevant as you've kind of assessed the company in terms of the metrics driving the business? Thank you. Shlomo. I'll go first, thanks for the question. Thanks for the welcome. Maybe let's take your questions in reverse order. In terms of client count and user count, more than happy to share. Our user count is up 12% year-over-year. You should expect to see those numbers in our 10-Q that we are filing, likely after market today. What fundamentally, we're committed to transparency, and we're committed to giving you the metrics that matter. An indication of user count tends to be in the long tail and not really flows through to the revenue or profitability that impacts the return that we provide for FactSet. Sanoke, do you want to take the first part of- Yeah, sure. As I said earlier, Shlomo, I'm really excited to see the transition we are making from just sort of shorter- term, maybe seed-based contracts to longer-term enterprise agreements that give us a lot of flexibility and give our clients a lot of flexibility. Just to give you a little bit of color on how they are structured. I think the operative word between us and our clients is flexibility. It is an uncertain future, I think clients are unclear as to exactly where their own consumption will be. At the same time, there is a high degree of trust working with us. We've been able to parlay that sort of paradigm, if you will, into structuring these contracts. The contracts are all value-based. Any price improvement that we see is based on the value we deliver. I can definitely confirm we are not taking any price compression in return for the contract extensions. Right. As it stands, I think there is a lot of new functionality, a lot of new data sets that we are launching, and we are delivering it through more and more new channels. We talk a lot about MCP, but a tremendous amount of our delivery happens directly on the large data meshes, whether it is Snowflake or Databricks or Google or AWS. We are pretty tech forward, as you know, and that ability to deliver data through multiple channels and provide lots of new functionality plays into these contracts. In an AI world right now, there is a lot of value that clients are placing on that. Our flexibility is an important aspect of it. There is a large subscription base to it, I think we feel very comfortable about that. There is a lot of provisions for new consumption patterns, whether it is in terms of diversity of data sets or increased volume tiers, depending on the type of workloads that clients are experimenting with. We feel pretty good about this transition. We'll continue to focus on it. It is still early days and we'll keep you updated in future quarters. Thank you. Our next question comes from the line of Surinder Thind with Jefferies. Your line is now open. Thank you. Sanoke, can you maybe discuss a little bit about the commentary on the review of the product portfolio? How expansive is it or how comprehensive is it? Is there a certain theme that you're pursuing? Maybe where does M&A fit into that strategy? Sure. I'll touch first from an AI perspective, Surinder, then maybe expand a little bit to our broader sort of what I would call the classical product definitions of who we are as a company. Just on the AI world, we should look at the stack that we talked about earlier in our prepared remarks. We see us playing across that stack and positioning ourselves as the AI infrastructure for institutional finance. We see our capabilities and data concordance, the quality of the data we deliver, our ability to integrate and mesh with internal and third-party data as world-class, and we see that as an essential ingredient as clients build out their enterprise knowledge graphs. That's at that first layer of the FactSet Intelligence stack. The workstation itself, we view as very much a container that has a lot of capabilities to it today that is all desired in this AI world. It has trusted infrastructure, which is feature-rich. It is already baking in all of this trusted data that is positioned to support these new agentic workloads. We have the right entitlements, we have the right model libraries, we have the security standards. The UI itself, the user interface, we think is less relevant. That might very well adapt, and we are very actively adapting it ourselves into more of an agentic infrastructure and an agentic user interface, which is fully infused with the best AI capabilities. We are starting to see the benefits of all of this because as clients are exploring and experimenting with lots of horizontal and vertical AIs, they are starting to come back and consolidate it on our own agentic infrastructure. The product development there we see is the transition from a traditional workstation to an AI native or an agentic workstation. That then leads to what I talked about in the call earlier, which is brand-new workflows, fully infused with agentic capabilities, and we are partnering very actively with clients, and these have to be developed and delivered with our forward-deployed engineers as well as forward-deployed consulting teams. That's all in the AI stack. Now, let me maybe pivot a little bit to talk about product development, from a different axis, if you will, which is our capabilities in data and analytics. Here, we're continuing to invest in and grow, and this is really a big driver of our growth in fixed income analytics. We've always been very strong at it in our performance analytics, portfolio analytics capabilities, but we are now bringing all of that capability also to the front office, and we are winning and taking market share from incumbents there. We are extending our capabilities in private capital, so our private market data sets are some of the fastest-growing SKUs, if you will, in data delivery. As you know, we've spoken about it in prior quarters, we're continuing to invest in deep sector data as well as in our real-time and pricing and reference data capabilities. All of this is resonating well, and we'll continue to invest in it. You can see us rounding out both in terms of the vertical of the AI stack as well as across a range of horizontal data disciplines and analytics capabilities. Thank you. Our next question comes from the line of Toni Kaplan with Morgan Stanley. Your line is now open. Hi, good morning. This is Yehuda Silverman on for Toni. Just had a quick question on the payback period. I know you previously mentioned three years for some of the heavier investments. Just curious if you can update us on if there's any difference in change in the payback period around some of the more recent AI-related investments and where we currently stand on the timeline for some of the investments that have been made over the past quarters and years. Yes. Two things. We are making investments in a number of different areas. There are investments we've made in improving our sales productivity, our tooling, our marketing capabilities, our website, et cetera. These are very fast payback initiatives that pay back in a matter of months. We are very excited to continue to make those sets of investments. There are structural investments that we have to make deep in the core infrastructure of the company. Those generally tend to take longer, we still believe that they are well in line with what we've said before. Thank you. Our next question comes from the line of Andrew Nicholas with William Blair. Your line is now open. Hi, good morning. Appreciate you taking my question. I think a lot of the AI discussion is rightfully centered on the institutional business, I'm curious how you think about any differences in the opportunity, the pace of adoption, the right to win within Wealth. Obviously, maybe TIFIN.AI and that partnership is part of that answer. I don't know if, Josh, given your background, you have any additional insights on kind of market positioning and how you see FactSet in that market. Just kind of curious if there's any differences in strategy we should be thinking about as to AI in that space versus the rest of your business. Thank you. Yeah. Thanks for that question. Indeed, I think we are seeing differences in the trends. A lot of our institutional progress is exactly as you pointed out, very related to the stack that we talked about earlier. In Wealth and the broader consumer finance market, there is an exciting opportunity for us both to power up the advisor experience, which is certainly going through a transformation. We are still, I believe, very early stages of that, and the TIFIN engagement and partnership is very much geared towards improving the experience of advisors. I'll touch a little bit more on that. The second thing is there's a big opportunity for us and a growing opportunity for FactSet in directly serving the end customer's experience. Especially in wealth management, but even more broadly in retail consumer finance. Two reasons. Number one, we have the trusted data. Two, even in the historical pre-AI world, we always had a digital business that allowed us to reach directly out into clients. For example, some of the largest wealth managers out there, their client-facing portals are all related to what we build and deliver that for them. The point I want to get to on Wealth is that advisor experience is evolving, and it's still at its early stages. One of the largest business problems for advisors is how to stay on top of their customer portfolios, market events, and all the analytics associated with it in order to deliver high-quality experiences and improve their coverage ratios. This is precisely where the TIFIN agents will help us because we can marry that up with our market data, signals, internal data, internal research, and deliver high-quality advisor experiences. Josh? I would just add, it'll come as no surprise, clients are in different stages of evolution. Every sector is in a different stage of evolution. I think we're incredibly excited about the conversations that we're having. With regard to the advisor experience, really in the long tail of advisors, particularly into RIAs, there is really a lot of opportunity to almost think about the way advisors do their jobs differently. I think FactSet may have a role to play there. Fundamentally, across the board, whether it's in Wealth, in the sell- side, in the buy- side, what we're seeing is people are starting to recognize, particularly as more work shifts from humans doing the work to agents doing the work, the quality of the output depends on the quality of the data that's going in. That creates a real opportunity for FactSet to play a significant role. That is something that I and we are very excited about. Thank you. Our next question comes from the line of George Tong with Goldman Sachs. Your line is now open. Hi. Thanks. Good morning. Can you unpack the contribution of pricing to organic ASV growth this quarter, and how much it's coming from realized pricing increases versus seed expansion, product mix, or a broader workflow adoption as you roll out your AI capabilities? Sure, George. Thank you for that question. Price increases, as I referred to earlier, we view that in the context of value increase for our clients. Our real focus is on retention and expansion of our existing enterprise client base. We don't believe in just an inflationary price increase. Having said that, I think our price increase this quarter was better than what we were able to achieve at the same quarter last year, and that just reflects the continued increase in value and flexibility that we are delivering to our clients. Thank you. Our next question comes from the line of Jason Haas with Wells Fargo. Your line is now open. Good morning, and thanks for taking my questions. I just wanted to circle back to the implied margin cadence for the rest of the year. If I model to the midpoint of your guidance, I am getting like flat-ish year-over-year adjusted operating margins versus it was just down over 250 basis points or so in fiscal 3Q. It is implying pretty nice improvement in the run rate growth of expenses there. Was there like pull forward of compensation expense from 4Q into 3Q, or is it because you did this headcount reduction, now the run rate of expenses is lower going forward? If you could just kind of match up the qualitative commentary to what the guidance implies, that would be very helpful. Thank you. Sure. Let me just maybe address that quickly, keeping an eye on the time. What I would say is we have a big quarter ahead of us. We continue to see strong ASV growth. We see a lot of momentum in that. What we have left for ourselves in terms of flexibility in the margin range is that if we continue to outperform on our ASV delivery and we want to pay for performance, I think we are retaining the flexibility in the margin range. Thank you. As a reminder, to ask a question at this time, please press star one one on your touch-tone telephone. Our next question comes from the line of Curtis Nagle with Bank of America. Your line is now open. Great. Thank you very much for squeezing me in. Maybe just talk a bit, or for Josh, either or, the impact of the higher token cost. You mentioned the margin in the quarter. I think you also mentioned there is an expectation to get higher returns on that spend. Sounds like the Google partnership might help, just unpack a little more if you would. Thanks for the question. Appreciate it. Tokens are an interesting one in the sense that they were not a line item that we really thought about in 2025. All of the token spending is net new. We treat tokens like any other resource, and we have a series of operational controls around monitoring them. There's a whole regime around developer training, intelligent model routing, so it's the right tool for the right job, budgeting that we've undertaken. Sanoke mentioned the ROI that we're seeing on tokens, we are very pleased to be growing our investment in them. Thank you. I would now like to hand the call back over to Sanoke Viswanathan for closing remarks. Thank you, operator, and thank you all for joining us today. Accelerating ASV growth, strengthening commercial performance, and measurable productivity gains are positioning us well for the remainder of the year and beyond. Before I close, I want to thank every FactSetter for their continued focus and commitment to delivering for our clients. We are executing from a position of strength, and we look forward to updating you on our progress next quarter. Operator, this concludes today's call. Thank you. This concludes today's conference. Thank you for your participation. You may now disconnect.