FICO and Equifax lost a combined $5.4 billion after a regulator called FICO's pricing a monopoly

$FICO lost $4.0 billion in market value on Thursday, closing down 16.68% at $932.26. $EFX lost another $1.4 billion, down 6.37%. Combined, that is $5.4 billion erased from two credit-scoring companies in a single session, on no earnings report at all.

The trigger was regulatory. Bill Pulte, director of the Federal Housing Finance Agency, said Thursday he had directed Fannie Mae and Freddie Mac to let every lender use VantageScore 4.0 immediately, ending the requirement that GSE-eligible mortgages be scored with FICO. "FICO has enjoyed a monopoly," Pulte said. "No more."

Why FICO fell three times as hard

FICO's decline was proportionally larger than Equifax's because mortgage scoring is a concentrated, high-margin slice of FICO's business in a way it is not for Equifax, which sells consumer reports, workforce data and other services alongside scoring. In its fiscal second quarter, FICO's Scores segment grew 60% to $475 million, driven by a 127% surge in mortgage origination revenue. That growth line is exactly what the FHFA order threatens: every GSE mortgage a lender scores with VantageScore instead is a score FICO does not get paid for.

That asymmetry shows up directly in Thursday's prices. FICO's market cap, $20.1 billion at Thursday's close, is now smaller than Equifax's $20.8 billion — a reversal from Wednesday, when FICO at $24.2 billion was still the larger of the two.

Equifax fell too, and that is the less obvious part

Equifax co-owns VantageScore alongside Experian and TransUnion, so a straightforward rotation story would have Equifax's stock rising as lenders shift toward the score it profits from. Instead it fell 6.37%. TransUnion, which we track independently of the S&P 500, dropped 5.94% over the same span (from $84.92 to $79.88), matching the decline Reuters reported for the stock. London-listed Experian fell 3.7%, per Investing.com's report on the announcement — a figure we have not independently verified against our own data since Experian is not in the indices this site tracks.

The reason all three bureau stocks fell together is in Pulte's fuller statement: he did not just direct lenders toward a FICO alternative, he accused Equifax, Experian and TransUnion of "overcharging Americans for far too long" and said the administration is weighing further changes to how mortgage scores get sold. Markets read that as pricing scrutiny aimed at the whole credit-scoring business, not a rotation from one bureau's product to a rival's.

How unusual this is

FICO and Equifax do not normally move in lockstep. Looking at the last 24 trading sessions (excluding weekend snapshot duplicates), the two stocks moved more than 2% in the same direction on only four days, including today. On the other three, the largest simultaneous move was a 7.8% gain in FICO against a 6.2% gain in Equifax on August 19. Thursday's -16.7% / -6.4% pairing is far outside anything either stock did alongside the other in the past month.

Volume confirms this was a repricing, not noise: FICO traded 1.43 million shares Thursday against roughly 200,000–300,000 on a typical recent day, and Equifax traded 2.73 million against a recent daily average nearer 1 million.

What we are not claiming

We are not claiming FICO's mortgage-scoring revenue will actually decline by any specific amount — the FHFA order changes what lenders are permitted to do, not what they will choose to do, and FICO scores may remain the default for reasons of familiarity or investor-model requirements even where VantageScore is now allowed. We also cannot independently verify the Experian move or the exact FICO revenue mix FHFA officials cited in justifying the order; those figures come from secondary reporting, not our own database. And this piece describes what happened to these stocks' prices today — it is not a judgment on whether FICO, Equifax, or any other name is fairly valued now.