Why i3 Verticals Stock Dropped Today

Core Insights - i3 Verticals' shares fell over 10% following a conservative growth forecast for the upcoming year [1] - The stock price had previously declined as much as 24% earlier in the day [1] Financial Performance - Revenue from continuing operations increased by 7% year over year to $54.9 million in the fiscal fourth quarter ending September 30 [3] - A significant contributor to revenue growth was a 23% increase in software-as-a-service (SaaS) revenue [4] - EBITDA from continuing operations decreased by 1.5% to $14.4 million due to a rise in lower-margin professional services sales [5] Growth Outlook - For fiscal 2026, management projects revenue between $217 million and $232 million, and adjusted EBITDA between $58.5 million and $65 million, indicating growth rates of 2%-9% and 2%-13% respectively [6] - Certain projects in utilities and transportation markets are expected to recognize revenue more slowly than previously anticipated, but management believes growth will eventually accelerate [6][7] Strategic Shift - The company is focusing on transitioning to a primarily SaaS business model, which is expected to generate recurring revenue [4][9]