Key facts
- FICO will cut about 15% of its workforce.
- The company had 3,811 employees at the end of September 2025.
- The layoffs could affect approximately 570 workers.
- FICO expects about $27 million in pre-tax charges related to severance.
- US regulators are pushing to loosen FICO's hold on mortgage credit scoring.
- The FHFA directed Fannie Mae and Freddie Mac to allow the use of rival VantageScore.
Credit-scoring company Fair Isaac, known as FICO, announced on Tuesday it will reduce its workforce by approximately 15% as part of a broader restructuring and integration of artificial intelligence technologies. The company stated that this move aims to streamline operations and accelerate innovation.
FICO had 3,811 employees at the end of September 2025, suggesting the layoffs could impact around 570 workers. Employees began receiving notifications this week. The company anticipates incurring about $27 million in pre-tax charges in the fourth quarter of fiscal year 2026, primarily for severance costs, with the restructuring plan expected to be substantially completed by the third quarter of fiscal year 2027.
The job cuts occur amid significant regulatory pressure on FICO's long-standing dominance in mortgage credit scoring. Last month, the U.S. Federal Housing Finance Agency (FHFA) instructed mortgage finance giants Fannie Mae and Freddie Mac to permit all lenders to use VantageScore, a competing credit scoring model developed by Equifax, Experian, and TransUnion. FHFA director Bill Pulte also indicated that both Fannie Mae and Freddie Mac would implement a uniform pricing structure for both FICO and VantageScore, aiming to place the two scoring systems on equal footing.