FACTSET RESEARCH SYSTEMS INCFDS
FACTSET RESEARCH SYSTEMS INC Stock Compensation Disclosure
STOCK-BASED COMPENSATION
Our stock-based compensation expense consists of stock options, RSUs, PSUs and purchases of common stock under the ESPP.
Stock-based Compensation Expense
The following table presents the stock-based compensation expense for the fiscal years presented:
| Years Ended August 31, | ||||||||||||||
(in thousands) | 2025 | 2024 | 2023 | |||||||||||
Stock-based compensation expense | $ | 61,229 | $ | 63,501 | $ | 62,038 | ||||||||
There were no stock-based compensation costs capitalized during fiscal 2023 through fiscal 2025. As of August 31, 2025, $119.3 million of total unrecognized stock-based compensation expense related to non-vested stock-based awards is expected to be recognized over the remaining weighted average vesting period of 2.9 years.
Stock Option Awards
A summary of stock option activity is as follows:
Number Outstanding (thousands) | Weighted Average Exercise Price Per Share | Weighted Average Grant Date Fair Value | Aggregate Intrinsic Value (millions)(1) | Weighted Average Remaining Contractual Life (years) | ||||||||||||||||
| Outstanding as of August 31, 2022 | 2,089 | $ | 253.85 | |||||||||||||||||
| Granted – employees | 268 | $ | 426.22 | $ | 125.57 | |||||||||||||||
| Granted – non-employee directors | 5 | $ | 428.70 | $ | 128.84 | |||||||||||||||
Exercised(2) | (318) | $ | 181.67 | |||||||||||||||||
| Forfeited | (56) | $ | 373.04 | |||||||||||||||||
| Outstanding as of August 31, 2023 | 1,988 | $ | 285.95 | |||||||||||||||||
| Granted – employees | 243 | $ | 436.61 | $ | 132.59 | |||||||||||||||
| Granted – non-employee directors | 6 | $ | 462.23 | $ | 132.78 | |||||||||||||||
Exercised(2) | (376) | $ | 213.62 | |||||||||||||||||
| Forfeited | (38) | $ | 404.47 | |||||||||||||||||
| Outstanding as of August 31, 2024 | 1,823 | $ | 319.07 | |||||||||||||||||
| Granted – employees | 203 | $ | 459.17 | $ | 133.21 | |||||||||||||||
| Granted – non-employee directors | 6 | $ | 453.98 | $ | 144.90 | |||||||||||||||
Exercised(2) | (300) | $ | 239.69 | |||||||||||||||||
| Forfeited | (47) | $ | 427.76 | |||||||||||||||||
| Outstanding as of August 31, 2025 | 1,685 | (3) | $ | 347.50 | $ | 101.1 | 5.6 | |||||||||||||
| Options vested and exercisable as of August 31, 2025 | 1,018 | $ | 293.48 | $ | 97.7 | 4.2 | ||||||||||||||
Options expected to vest as of August 31, 2025 | 615 | $ | 428.64 | $ | 3.4 | 7.6 | ||||||||||||||
(1)The aggregate intrinsic value represents the difference between our closing stock price as of August 29, 2025 of $373.32 and the exercise price, multiplied by the number of options exercisable as of that date.
(2)The total pre-tax intrinsic value of stock options exercised during fiscal 2025, 2024 and 2023 was $66.5 million, $89.5 million and $77.5 million, respectively.
(3)As of August 31, 2025, 1,685,011 shares underlying the stock option awards were unvested and outstanding, resulting in unamortized stock-based compensation expense of $48.4 million that is expected to be recognized over the remaining weighted average vesting period of 2.9 years.
During fiscal 2025, 2024 and 2023, the total fair value of stock options vested was $23.2 million, $20.5 million and $18.9 million, respectively.
Employee Stock Option Awards
Our annual grant of employee stock options during the first quarter of each fiscal year makes up the majority of our employee stock options granted under the LTIP in each fiscal year.
The following table presents the weighted average inputs used in the binomial model to estimate the grant-date fair value of the employee stock options granted:
| 2025 | 2024 | 2023 | |||||||||
Stock options granted(1) | 203,114 | 243,379 | 268,185 | ||||||||
| Risk-free interest rate | 4.31% - 4.87% | 3.78% - 5.53% | 3.37% - 5.05% | ||||||||
| Expected life (years) | 6.6 | 6.6 | 6.6 | ||||||||
| Expected volatility | 23% - 25% | 19% - 25% | 24% - 25% | ||||||||
| Dividend yield | 0.95 | % | 0.90 | % | 0.83 | % | |||||
(1) Includes the annual employee grant on November 1, 2024, November 1, 2023 and November 1, 2022 of 200,693, 242,371 and 266,051 stock options, respectively. The majority of the stock options granted, including the annual employee grants, vest 20% annually on the anniversary date of the grant and are fully vested after five years, expiring ten years from the date of grant.
Restricted Stock Awards
A summary of Restricted Stock Award activity is as follows:
| (in thousands, except per award data) | Number Outstanding | Weighted Average Grant Date Fair Value Per Award | |||||||||
| Balance at August 31, 2022 | 233 | $ | 338.87 | ||||||||
Granted – employee Restricted Stock Awards(1) | 97 | $ | 416.58 | ||||||||
Performance adjustment – employee PSUs(2) | 9 | $ | 245.67 | ||||||||
| Granted – non-employee directors RSUs | 2 | $ | 425.06 | ||||||||
Vested(4) | (83) | $ | 291.80 | ||||||||
| Forfeited | (14) | $ | 369.71 | ||||||||
| Balance at August 31, 2023 | 244 | $ | 381.15 | ||||||||
Granted – employee Restricted Stock Awards(1) | 111 | $ | 423.57 | ||||||||
Performance adjustment – employee PSUs(2) | 14 | $ | 306.33 | ||||||||
| Granted – non-employee directors RSUs | 2 | $ | 458.23 | ||||||||
Vested(4) | (95) | $ | 330.00 | ||||||||
| Forfeited | (14) | $ | 405.37 | ||||||||
| Balance at August 31, 2024 | 262 | $ | 412.47 | ||||||||
Granted – employee Restricted Stock Awards(1) | 127 | $ | 444.30 | ||||||||
Performance adjustment – employee PSUs(2) | 7 | $ | 424.01 | ||||||||
Granted – non-employee directors RSUs | 3 | $ | 449.72 | ||||||||
Vested(4) | (89) | $ | 403.43 | ||||||||
Forfeited | (17) | $ | 420.83 | ||||||||
| Outstanding as of August 31, 2025 | 293 | (3) | $ | 429.19 | |||||||
(1)During fiscal 2025, 2024 and 2023, we granted 92,840 RSUs and 34,479 PSUs; 74,456 RSUs and 37,008 PSUs; and 63,009 RSUs and 34,482 PSUs, respectively.
(2)Additional PSUs were granted during fiscal 2025, 2024 and 2023 based on performance above the specified target level of achievement for PSUs granted on November 1, 2021, November 9, 2020 and November 1, 2019, respectively.
(3)As of August 31, 2025, 292,716 shares underlying the Restricted Stock Awards were unvested and outstanding, which resulted in unamortized stock-based compensation expense of $70.9 million that is expected to be recognized over the remaining weighted average vesting period of 2.9 years.
(4)During fiscal 2025, 2024 and 2023, the total fair value of RSUs vested was $21.7 million, $17.7 million and $14.5 million, respectively, and for PSUs vested was $14.4 million, $13.6 million and $9.8 million, respectively.
Employee Restricted Stock Awards
Our annual grant of employee Restricted Stock Awards during the first quarter of each fiscal year makes up the majority of our employee Restricted Stock Awards granted under the LTIP in each fiscal year. These awards entitle the holders to shares of common stock as the Restricted Stock Awards vest. For unvested Restricted Stock Awards, holders are not entitled to dividends declared on the underlying shares.
The majority of the RSUs granted vest 20% annually on the anniversary date of the grant and are fully vested after five years. The majority of the PSUs granted cliff vest on the third anniversary of the grant date. The ultimate number of common shares that may be earned pursuant to our PSU awards depends on the level of our achievement of stated financial performance objectives. The achievement range was 0% to 200% for the November 1, 2024 and November 1, 2023 annual grants and 0% to 150% for the November 1, 2022 annual grant.
Stock-based Awards Available for Grant
As of August 31, 2025, we had 3.3 million employee stock-based awards available for grant under the LTIP and 0.2 million non-employee director stock-based awards available for grant under the Director Plan.
In accordance with the LTIP and Director Plan, each Restricted Stock Award granted or canceled/forfeited is equivalent to 2.5 shares deducted from or added back to, respectively, the aggregate number of stock-based awards available for grant.
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.