Equifax's Q4 2024 Earnings Call: Unpacking Contradictions in Margins, Mortgage Markets, and Strategic Partnerships

These are the key contradictions discussed in Equifax's latest 2024Q4 earnings call, specifically including: EWS margins, mortgage market expectations, government program opportunity, cost savings from cloud transformation, and Workday partnership impact:



Mortgage Market Decline:
- Equifax's U.S. mortgage revenue is expected to decline 12% in 2025.
- The decline is mainly due to a sharp decrease in mortgage inquiries since mid-December, driven by mortgage rates rising above 7% and impacting consumer confidence.

Free Cash Flow Generation:
- Equifax expects to generate over $900 million in free cash flow in 2025, approaching a long-term target of 95% cash conversion.
- The strong cash generation is attributed to significant capital spending reductions through the cloud transformation and an increase in EBITDA.

International Revenue Growth:
- Equifax's international revenue grew by 11% in constant currency in Q4, reflecting strong performance across geographies.
- Growth was supported by increased activity in Brazil and continued strength in Canada and other Latin American markets, despite weaker economic conditions in the U.K.

Cloud Transformation Impact:
- Equifax has close to 85% of its revenue in the new Equifax Cloud, resulting in significant cost reductions and improved stability and data transmission speeds.
- The transformation allows for leveraging AI capabilities, driving innovation in new products and enhancing competitive advantage.