| 2017-09-13 15:55:58|
EFX, FICO… 15:55 09/13 09/13/17
Fair Isaac slides as Equifax CEO hints at changes after data breach
Shares of Fair Isaac (FICO) are sliding after Equifax (EFX) CEO Richard Smith apologized for the massive data breach at the company in an USA Today op ed and said the company is going to "make changes" to ensure nothing similar happens again. Fair Isaac had disclosed in a 10K filing any changes at any of the three major credit report agencies could have "a material adverse effect" on revenues and results of operations. EQUIFAX TO MAKE CHANGES: Equifax CEO Richard Smith has apologized for the massive data breach at the company, which he described as "the most humbling moment in our 118-year history" and resolved to "make changes" to ensure nothing similar happens again. Smith addressed the breach, which may have exposed personal data on up to 143M people, in an op ed published in USA Today. "Understandably, many people are questioning why it took six weeks to report the incident to the public," Smith wrote, adding that shortly after Equifax discovered what the company then thought was a limited intrusion, it engaged a cybersecurity firm to conduct an investigation. He continued, "Our top priority is doing everything we can to support affected consumers. Our team is focused on this effort, and we are engaged around the clock in responding to millions of inquiries from consumers. Importantly, outside investigators found no evidence of unauthorized activity on our core consumer or commercial credit reporting databases." CHANGES MAY HAVE 'MATERIAL ADVERSE EFFECT': In a 10K filing, Fair Isaac said: "We also derive a substantial portion of our revenues and operating income from our contracts with the three major credit reporting agencies, TransUnion [TRU], Equifax and Experian [EXPGY], and other parties that distribute our products to certain markets. The loss of or a significant change in a relationship with one of these credit reporting agencies with respect to their distribution of our products or with respect to our myFICO offerings, the loss of or a significant change in a relationship with a major customer, the loss of or a significant change in a relationship with a significant third-party distributor - including credit card processors-, or the delay of significant revenues from these sources, could have a material adverse effect on our revenues and results of operations." PRICE ACTION: In late afternoon trading, shares of Fair Isaac have dropped almost 2% to $139.56, while Equifax is once again down about 15% to $98.78. Meanwhile, TransUnion has slid over 8% to $43.77, and Experian had slipped 0.5% to $20.30.
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