Executives: Rachel Stern - General Counsel and SVP-Strategic Resources Phil Snow - CEO Maurizio Nicolelli - SVP & CFO Scott Miller - EVP, Global Director,

Sales
Analysts: Shlomo Rosenbaum - Stifel David Chu - Bank of America Merrill Lynch Alex Kramm - UBS Peter Heckmann - Avondale Toni Kaplan - Morgan Stanley Tim McHugh - William Blair Keith Housum - Northcoast Research Andre Benjamin - Goldman Sachs Mike Reid - Cantor Fitzgerald Patrick O'Shaughnessy - Raymond

James
Operator: Welcome and thank you for standing by. At this time, all participants are in a listen-only mode. [Operator Instructions] Now I will hand the call over to, Ms. Rachel Stern. Ma’am you may now begin.

Rachel Stern: Thank you, operator. Good morning and thanks to all of you for participating today. Welcome to FactSet’s second quarter 2016 earnings conference call. This conference call is being transcribed in real time by FactSet’s CallStreet service and is being broadcast live via the Internet at FactSet.com. A replay of this call will also be available on our website.

Our call will contain forward-looking statements reflecting management’s expectations based on currently available information. Actual results may differ materially. More information about factors that could affect FactSet’s business and financial results can be found in FactSet’s filings with the SEC. Annual Subscription Value, or ASV, is a key metric for FactSet. Please recall that ASV is a snapshot view of client subscriptions and represents our forward-looking revenues for the next 12 months.

Lastly, FactSet undertakes no obligation to update publicly any forward-looking statements as a result of new information, future events, or otherwise. Joining me today are; Phil Snow, Chief Executive Officer; Scott Miller, Director of Global Sales; and Maurizio Nicolelli, FactSet’s Chief Financial Officer. And now I’d like to turn the discussion over to Phil.

Phil Snow: Thank you, Rachel. Good morning, everyone, and welcome to today’s call.

At FactSet, we’re committed to bringing the world’s best insight and information to investment professionals. Our historical and recent track record of success has been built on two foundations; one, we have a real passion for understanding our clients’ needs and are driven to deliver an unparallel customer experience; and two, we invest our time and people into developing superior analytics, technology and content to meet those needs. And as a result, throughout our history, we’ve been able to consistently produce significant growth for our company and value for our shareholders. This past quarter was no different. In a tough beginning to the markets this calendar year, we produced solid growth.

We have increasingly diverse suite of enterprise and workstation solutions that enable us to weather a challenging time. In the second quarter, our organic growth ticked up to 9.5% from 9.4% in Q1, and excluding foreign exchange, ASV rose $29.8 million versus $25.4 million in the same quarter last year. ASV growth rate has been on an upward trend every quarter over the last nine quarters and rising 100 basis points since February of 2015. The buy-side and the sell-side both grew at 9.5% this quarter and the buy-side increased 20 basis points from 9.3% to 9.5%. And just to remind everyone, we define the buy-side as traditional asset management clients, hedge funds and wealth managers and we also include our CTS, Portware and market metrics businesses into that number.

And on the sell-side it’s defined as M&A, advisory, capital markets and equity research. Let's break down the key contributors to our growth in the second quarter. We had positive ASV changes related to broad-based growth globally from both the buy-side and the sell-side businesses, and we saw a solid growth in our core buy-side client base in all three of our regions; the Americas, EMEA and Asia-Pac. And on the sell-side, the growth is primarily driven with our middle market segment. This year our annual price increase contributed $9 million in the Americas.

And as we’ve mentioned in the past, the number of clients affected by the price increase each second quarter has been declining because more and more of our clients have been experiencing a price increase at the time of renewal and renegotiation of their contracts with us. And as a result, price increases occurred throughout the year and are not a significant item in the second quarter as they had been in prior years. Portware in its first full quarter being owned by FactSet performed well, as we made strides in both integrating the group into the FactSet organization and executing on its strong pipeline of new opportunities, which we take advantage of cross-selling the Portware solution to FactSet’s blue-chip global buy-side client base. CTS had an exceptionally good quarter. To remind everyone, our CTS suite provides FactSet content and analytics outside of the terminal products, and we had strong contribution this quarter from our core investment management client base, the CTS.

Lastly, the continued strong performance of our analytic suite contributed the buy-side growth. Multi-asset class offering, performance, risk, quantitative analysis, production and managed services, all make up an excellent suite of analytics products that we can sell into our clients at the enterprise level. And this boosted sales in all regions within the investment management business. Our recent analytics road shows in all three regions gave over 150 clients a first look at the next generation of our portfolio analytics suite. These products are core to our buy-side clients and continue to be a large piece of what’s driving that business.

Moving forward, our expectation of continued growth is based upon two main drivers that have historically produced consistent results. First, demand for our value-added applications is strong. This includes analytics, CTS, Portware, and RMS, our research management solution suite. We are connecting more dots within our client base with solutions for an increasing number of workflows. In parallel, we are laser-focused on our core workstation business.

Even in a challenging or tightening market, we view that we still have a relatively low share of front office users on both the buy-side and the sell-side, and over time, there is still tremendous opportunity to capture more users and portfolio management, research, banking, wealth and trading. We remain committed to understanding our clients’ needs and continue to provide them superior solutions that help them make smarter decisions every day. The Portware acquisition is a great example, both with innovative suite of trade automation solutions coupled with our expertise and portfolio analytics, will enable us - will enable clients to streamline the operations and focus on key decisions. We continue to push innovation while succeeding our servicing current client needs by investing in our people and developing them to succeed. We are really proud to announce that FactSet was recognized for the eighth time in a row on Fortune's 100 Best Companies to Work For list.

We view the investment in our employees is critical to providing the best service possible to our clients, to enable continued growth of our overall business. The investment industry is facing more challenging times. FactSet is a trusted partner for our clients, and we are uniquely positioned to give them the tools and support to weather the market volatility. At our heart, FactSet is a productivity tool. We make our clients’ workflows more efficient by providing a broad range of enterprise solutions and providing excellent service.

Our solid and expanding business enables us to reinvest and partner effectively with our clients to meet their needs for smarter investment decisions. And in doing so, we'll continue to drive organic revenue growth and return capital to our shareholders. Let me turn it over now to, Maurizio, who will give us some more detailed look into our second quarter performance.

Maurizio Nicolelli: Thank you, Phil, and good morning to everyone on the call. As you heard from Phil, our client-centric solutions enabled our business to continue to excel during a choppy period in the markets.

Here is a breakdown of our second quarter results, both from a revenue perspective, as well as from an operational view. Revenues grew in the second quarter to $281.8 million. Excluding revenues acquired from acquisitions completed within the last 12 months and the effects of foreign currency, organic revenues grew 9.5% over last year. During the just completed second quarter, U.S. revenues grew to $190 million.

Excluding revenue acquired from recent acquisitions, organic revenues in the U.S. were up 9.4% compared to the year ago second quarter. Non-U.S. revenues increased to $92 million. Revenues from our Europe and Asia-Pacific region were $69 million and $23 million, respectively.

Excluding foreign currency and acquired revenues from recent acquisitions completed in the last 12 months, the international growth rate was 9.6%. This growth rate breaks down into 7.3% from Europe and 17.6% from Asia-Pacific, respectively. As noted in the press release, beginning this quarter, we have changed our non-GAAP reporting by adjusting for deal-related amortization. Adjusted operating income and margin, adjusted net income and adjusted diluted earnings per share will exclude both deal-related amortization and non-recurring items. This change is intended to better reflect the underlying economic performance of the business.

A quarterly schedule reflecting this information retroactive to first quarter of fiscal 2015 had been included on page 10 of the press release. Included in our second quarter results were the following non-recurring items. First operating expenses include both a $2.4 million pre-tax charge from restructuring actions, as well as incremental $1.4 million charge for stock-based compensation expense related to a change in the vesting of performance-based stock options. Together, they increased operating expenses by $3.8 million. Secondly, the income tax expense includes a $7.3 million benefit related to the permanent reenactment of the U.S.

Federal R&D income tax credit, which occurred in our just completed second quarter and was retroactive to January 1, 2015. Adjusted operating income, which excludes $3.8 million in non-recurring items and $4.1 million in deal-related amortization, grew to $93 million, an increase of 9% from the second quarter last year. Adjusted net income, which excludes non-recurring items and deal-related amortization, grew 10% to $66 million, while adjusted diluted EPS grew 12% to $1.59. Now let's take a look at the expense side. Total operating expenses for the second quarter were $197 million.

Our adjusted operating margin this quarter was 33.1%, which excludes non-recurring items and deal-related amortization. Second quarter cost of services, expressed as a percentage of revenues, increased by 380 basis points compared to the year ago period. The increase was driven by higher compensation including stock-based compensation and amortization of intangible assets. Employee compensation expense grew due to the non-recurring restructuring cost, the change in the vesting of performance-based stock options, our headcount expansion from new hires and the addition of Portware. The increase in amortization of intangible assets primarily related to the recent acquisition of Portware.

SG&A expenses, expressed as a percentage of revenues, decreased by 160 basis points in the second quarter compared to the year ago period, due to lower compensation expense from employees performing SG&A roles and a reduction in global occupancy costs. At the end of our second fiscal quarter, we had 8,093 employees, an increase of 16% in global headcount during the past 12 months. We hired 160 net new employees this quarter, primarily from our engineering and consulting recruiting classes in the U.S. and Europe, and our content collection classes in Hyderabad and Manila. The second quarter effective tax rate was 20.2%, down from 24.1% a year ago due to a $7.3 million income tax benefit related to the permanent reenactment of the Federal R&D income tax credit.

Excluding discrete benefits in both years, our effective tax rate was 28.8%, down 160 basis points over last year. Free cash flow during the last three months was $81 million, an increase of $39 million from the same period last year. This increase represents our highest ever second quarter of free cash flow in company history. Our cash in investments balance was $198 million, down $5.2 million during the quarter. We define free cash flow as cash generated from operations less capital spending.

Free cash flow was up 90% year-over-year due to higher levels of net income, lower income tax payments and higher client receivable collections. Our DSOs were 33 days at the end of the second quarter compared to 36 days in the prior year period. During the second quarter, we repurchased 465,000 shares in the open market at an average price of $153 per share. Our diluted weighted average shares decreased by 527,000 shares as a result of our ongoing repurchase activity and a lower share price, reducing the dilution from existing share-based compensation. As Phil mentioned at the beginning of the call, throughout our history, we have been able to consistently produce significant growth for our company and value for our shareholders.

Although the markets have been volatile, our business model has proven to be resilient and continues to outperform within our industry. Our client-centric approach and the first five offerings help us remain strong in weak and strong markets. Now let's turn to our guidance for the third quarter of fiscal 2016. We expect that revenues will range between $286 million and $289 million. GAAP operating margins should range between 31% and 32%, which includes a 120 basis point reduction from the operations of Portware.

Adjusted operating margin should range between 32.5% and 33.5%. We expect our annual effective tax rate to range between 28.5% and 29.5%. GAAP EPS is expected to range between $1.54 and $1.58. Adjusted EPS is expected to range between $1.60 and $1.64. The midpoint of this range suggests an 11% year-over-year increase.

In conclusion, the first half of 2016 was strong. Our growth rate accelerated to higher levels while we continued to invest on our future growth opportunities. Thank you for joining our call this morning. We are now ready for your questions.

Operator: Thank you.

We will now begin the question-and-answer session. [Operator Instructions] One moment please for the first question.

Rachel Stern: Operator, I don't see any questionnaires in the queue currently. Can you please make sure that, that functionality is available to all of our listeners?

Operator: Yes, it is available. But let me go ahead and double-check.

[Operator Instructions]. At this time, there are no questions on queue.

Rachel Stern: Operator, I'm getting some messages from the dialers on our call that the functionality is not working. They’ve sent me emails saying that the functionality is not working. Can you please check that?

Operator: Would you like me to open the line, Rachel?

Rachel Stern: Yes, absolutely.

Please.

Operator: Okay. I'll open the lines. Just give me one quick second.

Rachel Stern: So if you’re a caller trying to ask a question, would you please keep trying?

Operator: Rachel, all lines are now open.

Rachel Stern: Operator, I don’t think that’s working. You should turn them off.

Operator: Okay.

Rachel Stern: Let me ask the callers again, if you are trying to ask a question, please can you hit the directions the operator gave you at the beginning of the call. Operator, I think we have a few questions now.

Could you please introduce the first questions?

Operator: Our first question comes from Mr. David Chu from Bank of America - I’m sorry, Mr. Shlomo Rosenbaum from Stifel.

Shlomo Rosenbaum: Hi, good morning. Thank you for taking my questions.

If you can just comment a little bit on what the ASV and revenue growth be if you excluded any incremental growth in the quarter from Portware, so we can get an idea if the business within Portware is accelerating/decelerating or staying the same? I think that would be helpful.

Maurizio Nicolelli: Sure, John. Well, it’s Maurizio. As you’ve seen in our historical organic revenue or organic ASV calculation, we include the incremental changes after an acquisition but we do pullout from our calculation any of - the amount that we have that we acquired in ASV. Now we have not changed that calculation, so we have included the changes in Portware in the organic number.

Keep in mind, they are not material at the end of the day. They are - Portware is less than 5% of overall ASV, but we don't break that out in our organic calculation. I will ask Phil to give us a little bit of color on how Portware is doing.

Phil Snow: Yes, sure. Thanks Maurizio.

Thanks for the question, Shlomo. Yes, so Portware is executing very well on its business plan. Just to remind everyone, when we made the acquisition, they had a very strong pipeline of large investment managers. So these are big sales. We continue to make big - good progress on the pipeline.

And from the profitability standpoint, they are doing better than expected. So if you look at adjusted EPS over $0.02 accretive to our results, whereas if you look at on a GAAP basis, we'd be $0.02 dilutive, and that's a little bit of ahead of where we thought we'd be at this point.

Shlomo Rosenbaum: So let me ask the question in different way. Is the business excluding Portware accelerating or decelerating?

Phil Snow: Performing well. As we said on the call, we are executing well, as you could see in the results that the number of workstations was down compared to the second quarter of last year, but we are doing exceptionally well with the broad range of products that we sell to our clients, so the analytics suite, CTS, RMS, Portware.

They are all contributing to our growth.

Shlomo Rosenbaum: Okay. And what impact - can you repeat again the FX impact on ASV in the quarter? I just missed that.

Maurizio Nicolelli: More than 95% of our ASV is billed in U.S. dollars.

There is an FX piece to it. There is a small portion of our ASV that's built in pounds and also small portion of it built in yen, but it was immaterial to the overall number. We do exclude that small piece from our organic growth rate calculation.

Shlomo Rosenbaum: And then - I'll just leave at the last one. Can you talk a little bit about the trends in the business in the quarter? In other words, there definitely was chop in the quarter, I guess, in different times.

And as you entered the quarter, how did it look versus exiting the quarter in terms of the environment in Europe?

Scott Miller: Hey Shlomo, it's Scott speaking. Clearly market volatility was a theme for us. There is both, a good and a bad to that. The challenge with market volatility is that we do see typically a slight slowdown in the sales cycle in the close cycle, so we did see some pipeline pushed into the second half. In general, we saw a lot more opportunity than we saw challenges because the volatility opened up lots of conversations around our analytical suite of problem - solutions, data, a lots of conversations around our CTS product.

So in general, we kept focus on the sales cycle like we had been going through the previous quarters, but we faced some of the challenges head-on. I was very happy with the way that we executed through the quarter.

Shlomo Rosenbaum: Okay. Great. Thank you very much.

Operator: Our next question comes from Mr. David Chu. Mr. Chu, you may now proceed.

David Chu: Hi.

Thank you. So in terms of the slightly slower subscriber growth in the quarter, was this primarily from the sell-side? It looks like the sell-side ASV growth slowed a little bit?

Scott Miller: Hi David, it's Scott. It was a mix. We did see a little bit on the buy-side as well. It tended to be with our same-store sales, our current client base where we were upselling.

What we did see was a nice uptick in new business conversations and new businesses closes. So there was a mix going on. Yes, there was some push but we saw an uptick in some of the closes as well.

David Chu: Okay, great. And then in terms of just the macro.

So, are you seeing firms cut spend in aggregate at this point?

Scott Miller: Not dramatically different than we had seen in the previous quarters. We are - clearly as we’ve said over the last couple of questions, market volatility gets people thinking and pausing a little bit but we haven't seen a dramatic shift in the spending. When you do see markets go the way they did, in many cases, there is a requirement for more analytics and more data. So we are approaching it from a proactive standpoint and we haven't really seen a dramatic shift in spending.

Phil Snow: I'll add to that as well, like we look through volatility in the markets at FactSet, and whenever we have a tightening, it really gives our sales team, with the relationship that we have with our clients, an opportunity to sit down, discuss their total cost of ownership and really review what they are spending.

So we have that great relationship with our clients and our sales people can really sometimes benefit from these types of market conditions.

David Chu: Okay, great. And just lastly, is the 2Q run rate or amortization of deal-relating intangibles in 2Q, is that a decent run rate for the rest of the year?

Maurizio Nicolelli: Correct.

David Chu: Okay. Thank you guys.

Maurizio Nicolelli: Yes. Thanks.

Operator: And our next question comes from the Mr. Alex Kramm of UBS.

Alex Kramm: Yes, hi.

Good morning. Yes, good morning. Sorry, I’m at a conference. Hopefully you can hear me okay. First off, can you just talk about buy-side versus sell-side? It seems like the sell-side in these choppy environments tends to be a little bit quicker in cutting than the buy-side.

So I think what the sell-side large firms, you have some minimums. So can you maybe talk through kind of like the volatility you can take before it actually starts hitting your business? And then on the buy-side, given the lag, do you get a little bit more incrementally concerned about the second half or nothing to worry at this point at this place? Thanks.

Scott Miller: Hey Alex, it’s Scott. Sell-side was mixed. There was a lot of M&A activity going on obviously in the last couple of quarters, and so we saw some really great conversations going on in that space.

There was clearly pressure on areas like the trading floor which is lesser than exposure to us. In the research area, we've got some good stuff going on there as well. So it was mixed. Buy-side, yet there was a slowdown in some conversations but that was a push in pipeline into the second half, so we feel - we still feel really good about the second half.

Phil Snow: Alex, it's Phil Snow.

So there are pieces of our business that are tied more to cyclicality than others, and the sell-side business is definitely more heavily levered to headcount versus our buy-side business. As we made in our comments at the beginning, our buy-side business is becoming less levered to headcount and we have products that are very sticky at the enterprise level that if you went back five or 10 years ago, wasn’t necessarily the case.

Alex Kramm: Okay, that’s helpful. Thanks. Then just one of the positives we continue to see here is that the ASV per user or per client is ticking up, and I think it made another jump this quarter or quarter-over-quarter.

I know to some degree this is Portware, but I mean it’s also reflection of cross-selling. I mean, is there an incremental push that you’re doing right now, or is it just a noise that jump around the ASV per user?

Phil Snow: It is noise. It’s a very hard one to dig into, but I think if you just go back to the comments I made on the previous question, it could be very much related to that.

Alex Kramm: Fair enough. And then, just lastly quick one.

Can you just remind us how big hedge funds are within your buy-sides community considering that those seem to be struggling a little bit more start the year?

Maurizio Nicolelli: We don’t break out the number explicitly in terms of client sides, Alex. But I will say that we saw some really good activity in the hedge fund space in the quarter. Yes, there is pressure on that market. There often is when there is volatility, but we saw some great new business wins in that space.

Alex Kramm: Much appreciate it.

That’s it for me. Take care.

Phil Snow: Thank you.

Operator: Thank you. Our next question comes from Mr.

Peter Heckmann from Avondale. Sir, you may proceed.

Peter Heckmann: Thank you. Good morning everyone. One observation and then a couple of questions.

And I think before asking around the edges, but on a first half basis, this year user adds are down pretty materially from the first half of last fiscal year, and so the two question would be, one, what are we seeing there? Is this just the natural lumpiness, or are we seeing the push out or would you say that there were areas in the business that saw some offsets? And then number two is that, how should we think about the business as it becomes less directly dependent on users? I mean, you’ve never said directly how much of the revenue is based on users. We've kind of estimated about a third, but it seems like it's even decreasing from that. Would that be more bundle enterprise licenses on the buy-side or more bundle deals that’s creating situation where even if users aren’t growing as fast, your penetration within clients is making up the difference?

Phil Snow: Yes, I think that’s - I mean, a good example is our CTS business. So with CTS, we can offer feeds of content or analytics or APIs where clients can get FactSet value outside of the workstation, and those types of solutions tend to be extremely sticky once they are in the clients.

Peter Heckmann: And so could you remind me - did you provide any user count at all on Portware?

Phil Snow: No, we did not.

Peter Heckmann: And how that layering in the numbers?

Phil Snow: That’s not - we don't include Portware users in our user count. It’s really kind of what you think of as the core FactSet workstation. And we also don't include users of our RMS suite, so we have three product lines in there. Two of them are locally deployed. One is code red.

That traditionally is we sold more to the buy-side, hedge funds, big plan sponsors, and our partner solutions which is on the sell-side. We also have web solutions that we sell our clients and we typically have not broken those at either. So there are lots of other people using FactSet other than the number that we report in our press release.

Peter Heckmann: Got it. Okay.

That’s helpful. Thank you.

Maurizio Nicolelli: Yes.

Operator: Our next question comes from Toni Kaplan of Morgan Stanley. Sir, you may begin.

Toni Kaplan: Hi, thank you. You had strong hiring again this quarter, up about 14% excluding Portware. Was the hiring again focused on sales people and consultant and is there a certain any area that they are focused on, or is it just general like selling and training?

Maurizio Nicolelli: The 160 net new employees that we had during the period really focused around our consulting and engineering classes in the second quarter, which is what we do every year, and also a piece of that hiring was also our content collection classes in Manila and Hyderabad. So it's really part of our second quarter employee headcount growth.

Toni Kaplan: Okay.

Yes, it was just up a lot year-over-year. So okay, that's fine. And then just could you give us an update on how you view your total addressable market in fixed income, whether it be in terms of dollars or number of clients or however it is that you look at it?

Scott Miller: I mean we view the numbers as extremely big and I think in a lot of markets, we don't feel that we have more than 5% or 10% of the addressable market share. So we tend to think of the overall market as being around $25 billion, which gives us sort of less than 5% market share. Not all of that is really addressable, but if you add up the market share of our major competitors, that's really what the industry is spending.

Toni Kaplan: Thanks a lot.

Operator: Thank you. Our next question comes from Tim McHugh. You may proceed - from William Blair. You may proceed.

Tim McHugh: Yes, thank you. First, I guess people have asked differently about the environment, so I might try one more just. You’ve talked about wanting to get the 10% growth and obviously you’ve been kind of slowly accelerating in the last year. Is this an environment conducive to that continuing as we think forward, or is it - in this environment would you say that you probably need a better environment to continue to see that to get to double-digit growth?

Phil Snow: So typically the way we think about growth is just - we just want to do very well relative to our competitors in the marketplace. I think that's the way we typically think of it.

We don't view our market share is necessarily expanding. We are really - it’s about taking market share and we are just going to continue to execute as well as we can against our competitors. But we are not going to put out any numbers there in terms of what we think we are going to do in terms of sales growth beyond the revenue guidance that Maurizio gave for Q3.

Scott Miller: Tim, it’s Scott. On the sales side, the opportunities that we’ve seen for a while now are still very much all there.

We’ve got some great stuff going on from new business and from upselling in current client base and none of that has moved. The market volatility because it's paused in some cases, yes, it has some impact on the direct workstation but the overall opportunities out there have not changed for us in many cases, they’ve actually increased because of the market volatility. So we are still very confident with the business growth.

Tim McHugh: And can I ask - I think this is - you came in kind of in the lower half of the guidance range which your history has given the visibility you usually at the upper half, and I think last quarter was the same thing and you said it was just kind of more backend loaded bookings. Is that true again this quarter? And if we've seen this for two quarters, is there a trend there, is there something about what products are selling in the environments that we should infer from that?

Maurizio Nicolelli: Hi Tim, it's Maurizio.

We actually did have a significant portion of our ASV recorded towards the January-February period during the quarter, so it lowered our - slightly lowered our revenue for the quarter, and we also have about $0.5 million deferred revenue adjustment from purchase accounting that still come into our revenue line from the Portware acquisition that lowers overall revenue. So when you take those two items, we are slightly lower than that where the consensus estimate was.

Tim McHugh: Okay. And then just one math. Now that the R&D tax credit is permanent, I guess, if this 29% the right tax rate that we could use going forward? Is that how you think about I guess steady-state?

Maurizio Nicolelli: 29% is right around steady-state.

Our range is between 28.5% and 29.5% and 29% is really right in the middle of that range.

Tim McHugh: All right, thanks.

Operator: Thank you our next question is from Keith Housum from Northcoast Research. Sir you may proceed.

Keith Housum: Great.

Thanks for taking my question. I appreciate it. I guess two questions for you if you don't mind. First, what was the FX impact on the bottom line, I guess, on EPS for the quarter or year-over-year?

Maurizio Nicolelli: FX did benefit us slightly during the quarter, but it was immaterial to our results at the end of the day. We did get a benefit from our pound and euro exposure, but just from the overall results, it was immaterial.

Keith Housum: Okay. And then I think the last comment in your bullet in your press release regarding getting into the index business. I guess, if guys could elaborate a little bit more on what your aspirations are with that and where you see yourself playing and perhaps where you guys could go with that?

Scott Miller: Hi Keith, it’s Scott. So we are spending some great effort in the ETF space both from say thought leadership and a data and analytics perspective. One of the outcomes from that is for us to be looking at the index base as well.

It's not core to our strategy going forward right now but it's something we find really interesting. We've had a number of our clients ask us about it and some partners who want to do some things with us in that space. So it's something that we are looking at. I put more emphasis on what we're doing in the ETF space as opposed to index.

Phil Snow: Keith, it's Phil Snow.

I agree with that. And the ETF effort that we have really is a function of the Revere acquisition that we made couple of years back. So Revere has an incredibly deep taxonomy to classify companies at a much deeper level than other products that are out there in the marketplace, and a lot of ETF providers have come to us to build universes of companies for them for a particular types of ETFs that they are creating and that's what you saw with State Street in the Innovative Technology ETF.

Keith Housum: Great. Thank you.

Operator: Thank you. And our next question is from Manav Patnaik from Barclays. You may proceed.

Unidentified Analyst: Hi, this is actually Greg [ph] calling on for Manav. Just wanted to ask about the international growth.

Looked like Europe slowed down a bit, maybe some pressures from the bulge bracket banks, but APAC was really strong. So any color that you can provide there on those two markets?

Scott Miller: Yes, Greg, I think your comments were right. We did see a slight slowdown across the EMEA. It was really in pockets. It was pretty broad-based, nothing that I would draw particular attention to.

And Asia-Pac continues to be a great growth market for us. We saw some really good stuff going on in sort of our non-core markets in China and Korea and in areas like that we saw some good stuff going on. So we like what we see out of Asia-Pac.

Unidentified Analyst: Okay. And then I just want to ask on what you're seeing in the M&A market and whether recent choppiness is providing any new opportunities and maybe an update on what you are seeing from a valuation perspective as well?

Phil Snow: So on the M&A front, Manav, not much has changed for us there.

We continue to focus on strategic acquisitions around unique content and adjacent workflows. But we’re - and we continue to see quite a few opportunities that we are interested in. But there is nothing transformative that we are looking at, at this time.

Unidentified Analyst: Okay. And one more from me.

Just any color you can provide on what the restructuring charge was - I guess, just what the restructuring charge was?

Maurizio Nicolelli: Sure, it’s Maurizio. So we went through and reviewed our large employee groups to realize some productivity gains in order to make us more efficient into the future. And so the $2.4 million charge really relates to just our overall restructuring process that we completed in Q2 and it's something that we go through every year to - every 12 to 24 months.

Unidentified Analyst: Okay. Thank you.

Operator: And our next question comes from Mr. Andre Benjamin from Goldman Sachs. Sir, you may begin.

Andre Benjamin: Thank you. Good morning.

First question I had, I know you had mentioned that most of the growth in the sell-side was from the middle markets. So I was trying to understand what are your finding successful in that segment, and is it really more a function of just lower penetration or is there something special that they find that the value proposition for that business - that part of the market versus your larger customer?

Scott Miller: It's a mix, Andre, of those two. So we are picking up market share in that space and we are also diversifying a little bit the user types and some of the different solutions, things like our RMS and our partner solutions are getting traction in that space and we are expanding beyond just the analyst user type in there as well. So it's mix to both of what you talked about.

Andre Benjamin: And are you doing anything - I know you've been investing a lot in the data procurement services.

Is there anything we should be aware of that you're trying to maybe leverage some of the data and change your economics or value proposition in terms of offsite more data that you’re collecting fundamentally versus [indiscernible]?

Phil Snow: We continue to invest heavily in content and that's where I think you saw some of the headcount growth coming from, and we just continue to pull more and more value into the workstation from a content standpoint. So having unique content and best of breed content is a big piece of FactSet’s value proposition and we know that just standing still for that is really not an option for us.

Scott Miller: And Andre, it’s Scott. I would add to that. We are getting - we’re doing more packaging of the content as well from a data feed perspective, specifically for the regulatory space and we saw some great traction on the back of that over the last couple of quarters.

Andre Benjamin: Thank you.

Operator: Thank you. Our next question is from Joseph Foresi. Sir, you may - one moment.

Mike Reid: Okay.

Hi, this is...

Rachel Stern: Operator, I think we lost the question. Can you please ask the folks who had been in the queue to put their questions in again?

Operator: Okay. [Operator Instructions]

Rachel Stern: Yes, I think we had a question from Joe Foresi coming up. So when you see him in the queue - there we go.

He should be the next questions. Operator, can you…

Operator: Mr. Joe Foresi, you may now - yes, Joe Foresi, you may now proceed.

Mike Reid: Can you hear me guys?

Phil Snow: Yes, we can. Go ahead.

Mike Reid: Okay, thanks. So this is Mike Reed on for Joe. I appreciate you taking the call. Just had a quick question about the 51 new clients. Is there any difference you're seeing in the make-up or is it generally the same as it's kind of been?

Scott Miller: It’s Scott, Mike.

Not a dramatic shift. We did see some good wins in the wealth space, and particularly some good wins in the insurance space which was off the back of our multi-asset class and fixed income risk solutions. Those are probably the two that I would highlight. Other than that, it was fairly broad-based. We’ve had a number of initiatives in terms of new business pipeline generation over the last couple of quarters and we are starting to see that come through quite well now.

Mike Reid: Okay. And then just another one, it’s sort of been asked about the macro environment. But do you or do you think you would see in the effects just in the general slowdown in the IPO cycle separate from, I guess, other macro concerns?

Scott Miller: It's Scott again, Mike. I don't see it as a particular factor for us. The M&A activities has been decent.

I don’t see it as a particular factor now.

Mike Reid: Okay. Great. Thanks guys.

Scott Miller: Thank you.

Phil Snow: Thank you.

Operator: Thank you. And our next question comes from Patrick O'Shaughnessy from Raymond James. Sir, you may begin. Patrick O’Shaughnessy: Hi.

So a couple of months ago there, the story out there, J.P. Morgan was apparently looking to replace several thousand terminals, Bloomberg terminals with Thomson Reuters. Curious if that was something that you're basically also trying to participate on? And then more broadly, do you see a trend at some of the major banks as they are currently focused on cost to try to rip out some of the Bloomberg some replace it with alternative lower price solutions?

Phil Snow: Hi Patrick, it's Phil Snow. I would say generally when we are out there talking with the C-level executives at the bigger banks, there is definitely a focus on total cost of ownership and that could come from any type of vendor. So whenever somebody is paying a lot of money and they feel that they are not getting the most value out of that, they are going to look for alternatives, and that's - I think if you go back to one of the comments earlier on the call, in an environment like this it really gives us great opportunity to sit down with clients and look at their overall spend.

Patrick O’Shaughnessy: Okay. And then specifically with J.P. Morgan. Is that something that business that you were going after or is that a product set that may be Thomson Reuters could fit better than what you guys could offer?

Phil Snow: We got a good relationship with all the major banks and we've got some great conversations going on with all of them. Patrick O’Shaughnessy: All right.

Thank you.

Operator: Thank you. And our next question is from Peter Appert from Piper Jaffray. Sir, you may proceed.

Unidentified Analyst: Hi, this is actually Steven dialing for Peter.

Thank you for taking my question. I just want to ask a little bit more about the password [ph] growth. In the quarter, we see a deceleration of the password [ph] growth. Is that a function of competitive dynamics or challenging comps, or is the user market environment getting more difficult?

Scott Miller: Hi, it’s Scott. I don't see it as a result of competitive at all.

If anything, it was somewhat market-driven with the volatility in the market. Again we're not seeing it as a concern. The great thing about our business is that we’ve got incredibly diversified portfolio of solutions out there that can offset any market condition downturns in workstation growth. We've also got some good plans in place to build up that workstation growth in the coming quarters as well, so not major concern.

Unidentified Analyst: Great.

And just another question. I was just wondering what kind of growth are you seeing [Technical Difficulty] revenue or just data feeds, and is there any significant differences in the profitability in non-terminal?

Scott Miller: Thanks for the question. So traditionally we’ve just not broken out that growth rate, but one good byproduct that collecting a lot of content for our terminal product is that we can then turn around in a lot of cases and monetize that with feeds. So I would say, yes, that is - there is some good profitability associated with our CTS business.

Unidentified Analyst: Okay, great.

Thanks.

Scott Miller: Thanks.

Operator: Thank you. And our next question is from Mr. Shlomo Rosenbaum of Stifel.

Sir, you may proceed.

Shlomo Rosenbaum: Hi, thank you for squeezing me back in. I just want to ask a little bit in terms of the competitive environment and specifically Thomson Reuters. It looks at least data from some of the data that I have that they might have actually increased workstations for the time sequentially since 2008, and I just want to know if there is a change that - you’re noticing a change on their side in terms of even more aggressive pricing or anything like that? And then I have one other follow-up question after that.

Scott Miller: Shlomo, it's Scott.

We haven't - in the last quarter I haven't seen a dramatic change. There is lots going on in the competitive environment. I haven't seen any dramatic change in pricing strategy. No is the short answer.

Shlomo Rosenbaum: Okay.

And what exactly is the insurance product sale?

Scott Miller: It’s our - it is not terribly different to our typical investment management say more emphasis is clearly on the fixed income space because of the assets that they typically have under managements. So it's the portfolio analytics, portfolio risk, sale our core product along with portfolio services, but a big focus on multi-asset class and fixed income.

Shlomo Rosenbaum: Okay. Thank you.

Operator: And that concludes today's conference.

Thank you for participating. You may now disconnect.