Jim Cramer Defends FICO Amid Regulatory Pressures

Jim Cramer defends Fair Isaac Corporation after a 6% dip due to regulatory headwinds. Cramer believes the stock's sell-off was unjustified, citing FICO's strong business model and historical performance. He notes that the company provides software and analytics tools for automated decision-making in credit scoring, fraud detection, and customer management. Cramer argues that certain AI stocks offer greater upside potential and carry less downside risk.

In the wake of a 6% dip in Fair Isaac Corporation (FICO) stock following regulatory headwinds, Jim Cramer has come to the defense of the company. Cramer believes that the sell-off was unjustified, citing FICO's robust business model and historical performance. The stock's decline, which saw it drop to $1,477.12, was partly attributed to broader market conditions and investor caution [1].

Cramer highlighted FICO's strong business model, which focuses on providing software and analytics tools for automated decision-making in credit scoring, fraud detection, and customer management. He argued that the company's innovative products, such as FICO Score 10T and 10T BNPL, demonstrate its leadership in the credit scoring industry. These products are designed to improve lending accuracy and financial inclusion by incorporating new data sources, such as buy now pay later (BNPL) data [1].

Cramer also noted that FICO's performance in the third quarter of 2025 was impressive, with non-GAAP earnings per share (EPS) of $8.57, exceeding expectations by 11.59%. Revenue also surpassed forecasts, reaching $536 million, a 20% year-over-year increase. The company's share buyback of $105 million, the largest in its history, further underscored its commitment to returning value to shareholders [1].

Despite the recent dip, Cramer believes that FICO's stock offers greater upside potential and carries less downside risk compared to other AI stocks. He argues that the company's strong financial fundamentals and market leadership position it well to weather regulatory headwinds and continue its growth trajectory [1].

References:
[1] https://www.investing.com/news/transcripts/earnings-call-transcript-fair-isaac-beats-q3-2025-expectations-stock-reacts-93CH-4161536