A method factors a functional (i.e., ambiguous) finite state transducer (FST) into a bimachine with a reduced intermediate alphabet. Initially, the method determines an emission matrix corresponding to a factorization of the functional FST. Subsequently, the emission matrix is split into a plurality of emission sub-matrices equal in number to the number of input symbols to reduce the intermediate alphabet. Equal rows of each emission sub-matrix are assigned an identical index value in its corresponding factorization matrix before creating the bimachine.