Cybersecurity and IT Risks - The company faces significant risks from cyber-attacks and evolving IT security threats, which could disrupt operations and harm competitive position [54] - Disclosure of personally identifiable information could lead to liability and damage the company's reputation, especially in light of increasing data breaches [55] - The company relies on third-party vendors for critical services, and any failure by these vendors could adversely affect operating results and business prospects [56] - The company engages third parties for deliverables and services, and any deficiencies in their performance could jeopardize client contracts and financial condition [57] - The company depends on third-party hosting services, such as AWS, and disruptions in these services could lead to client dissatisfaction and revenue loss [59] - The company utilizes third-party licensed software, and any inability to maintain these licenses could limit product functionality and increase costs [62] - The company’s solutions include open source software, and failure to comply with open source licenses could adversely affect business operations [64] Technological Adaptation and Innovation - The company must adapt to rapid technological changes and evolving client requirements to remain competitive, which poses risks if new products are not developed timely [66] - Incorporating AI technologies presents challenges, including the risk of delays in innovation that could render offerings less competitive [67] - Errors or defects in new products or enhancements could result in revenue loss and delay market acceptance, impacting future operating results [65] Financial Condition and Debt Management - The company has entered into a $700.0 million credit agreement, providing an unsecured revolving credit facility [83] - As of December 31, 2025, the company had $600 million of Convertible Senior Notes outstanding and none under the 2024 Credit Agreement [84] - The company’s ability to service its indebtedness is contingent on future performance, which is subject to various external factors [87] - Covenant restrictions under the company's indebtedness may limit operational flexibility and adversely affect financial condition [88] - The company may incur additional indebtedness, which could increase risks related to its business operations [89] - The company is exposed to interest rate risk due to variable rate indebtedness under the 2024 Credit Agreement, which could increase debt service obligations if interest rates rise [90] - As of December 31, 2025, the company had no outstanding borrowings under the 2024 Credit Agreement, with an available borrowing capacity of $700.0 million [231] - The interest rates on loans under the revolving credit facility can range from 0.125% to 0.75% above the prime commercial lending rate or from 1.125% to 1.75% above the SOFR rate [232] - Increased inflation and interest rates could negatively impact the company's financial condition and access to capital [91] Market and Competitive Risks - The company faces risks related to public sector sales, which account for substantially all of its revenues [70] - A prolonged economic slowdown could reduce demand for the company's software products and services, negatively impacting growth and profitability [73] - The company may face increased competition from established and emerging companies in the public sector software market, which could lead to pricing pressure and reduced market share [79] - Fixed-price contracts may expose the company to cost overruns and penalties, potentially harming financial performance [80] - The company may be unable to secure performance bonds on favorable terms, impacting its ability to win large contracts [81] Operational Challenges and Strategic Focus - A significant investment in research and development may decrease overall margins, but is essential for maintaining competitive position [93] - The company may face challenges in executing its acquisition strategy, which is crucial for growth, due to integration difficulties and unforeseen liabilities [97] - Labor costs are subject to external factors and may increase due to a tightening labor market, potentially affecting profitability [100] - The company does not foresee paying dividends on its common stock in the foreseeable future, as it intends to retain earnings for business expansion [105] - Compliance with evolving corporate governance regulations may result in increased expenses and divert management's focus from revenue-generating activities [103]

There’s no doubt that in 2026, the worst-performing sector in the stock market is the software sector. Investors have sold off virtually all software stocks on rising fears that AI will unseat long-established subscriptions.With combined experience of covering technology companies on Wall Street and working in Silicon Valley, and serving as an outside adviser to several seed-round startups, Gary Alexander has exposure to many of the themes shaping the industry today. He has been a regular contributor on See ...

PLANO, Texas--(BUSINESS WIRE)---- $TYL #TylerTech--Tyler Technologies has been recognized as aGovTech 100company for 2026. ...

Core Insights - Tyler Technologies (TYL) reported Q4 2025 earnings of $2.64 per share, missing the Zacks Consensus Estimate of $2.71, but showing an increase from $2.43 per share a year ago [1] - The company generated revenues of $575.2 million for the quarter, which was 2.45% below the Zacks Consensus Estimate, compared to $541.13 million in the same quarter last year [2] Revenue Performance - Recurring revenues from maintenance and subscriptions rose by 10.9% year over year to $514.4 million, making up 89.4% of total revenues [3] - Annualized recurring revenues (ARR) reached $2.1 billion, also reflecting a 10.9% year-over-year increase [3] - Maintenance revenues accounted for 19.0% of total revenues at $109.4 million, down 4.9% year over year, while subscription revenues grew by 16.1% to $405.0 million, driven by a 20.2% increase in SaaS revenues and a 12.1% increase in transaction-based revenues [3] Operating Performance - Non-GAAP gross profit increased to $280.6 million, with a non-GAAP gross margin of 48.8%, up 180 basis points [5] - Adjusted EBITDA rose to $149 million from $142.8 million in the previous year [5] - Non-GAAP operating income was $138.5 million, a 5.1% increase year over year, with a non-GAAP operating margin of 24.1%, down 30 basis points [5] Balance Sheet and Cash Flow - As of December 31, 2025, cash and cash equivalents were $1.015 billion, up from $834.1 million in the previous quarter [6] - The company generated operating cash flow of $243.9 million and free cash flow of $236.9 million in Q4 2025 [6] - For the full year 2025, operating and free cash flows were $653.5 million and $620.8 million, respectively [6] 2026 Guidance - Tyler Technologies projects 2026 revenues between $2.50 billion and $2.55 billion, with the Zacks Consensus Estimate at $2.35 billion, indicating a 9.8% year-over-year increase [9] - Expected GAAP diluted EPS is in the range of $8.36-$8.61, while non-GAAP diluted EPS is projected between $12.40-$12.65 [9] - The free cash flow margin is anticipated to be between 26% and 28% [9]

Tyler Technologies (NYSE:TYL) Q4 2025 Earnings call February 12, 2026 10:00 AM ET Company ParticipantsBrian K. Miller - CFOHala Elsherbini - Senior Director of Investor RelationsLynn Moore - President and CEOConference Call ParticipantsAdam Hotchkiss - Equity Research AnalystAlex Zukin - Equity Research AnalystAlexei Gogolev - Equity Research AnalystAndrew Sherman - Equity Research AnalystCharlie Strauzer - Equity Research AnalystClarke Jeffries - Equity Research AnalystJonathan Ho - Equity Research Analyst ...

Financial Data and Key Metrics Changes - Total revenues for Q4 2025 were $575.2 million, an increase of 6.3% year-over-year [13] - Recurring revenues grew by 11%, with SaaS revenue growth exceeding 20% and transaction-based revenue growth at 12% [6][15] - Free cash flow reached a record high in Q4, up nearly 10%, with a free cash flow margin of 41% [6][18] - Annualized recurring revenue was approximately $2.06 billion, up 10.9% [17] Business Line Data and Key Metrics Changes - SaaS revenues grew by 20.2%, surpassing $200 million in a quarter for the first time [15] - Transaction revenues increased by 12.1% to $196.7 million, driven by higher transaction volumes and new service deployments [15] - Total SaaS bookings grew by 9.6% year-over-year, with annual contract value from flips signed in Q4 rising 64.5% over last year [17] Market Data and Key Metrics Changes - The public sector market fundamentals remain strong, with healthy budgets supporting an active pipeline [6] - RFP and sales demo activity are at elevated levels as agencies prioritize modernization of critical systems [6] Company Strategy and Development Direction - The company focuses on four key growth pillars: completing the cloud transition, leveraging the client base, growing the transactions business, and expanding into new markets [8] - A unified payment strategy has been executed to capture greater value and drive operational efficiencies [8] - The company is transitioning to AI-enabled solutions, with plans for deeper integration into operational workflows [26][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to deliver sustained growth through competitive strengths and digital transformation initiatives [24] - The company anticipates total revenues for 2026 to be between $2.5 billion and $2.55 billion, implying growth of approximately 8.3% [19] - The market is showing healthy demand, with strong sales activity and a high number of RFPs [53] Other Important Information - The company completed four strategic acquisitions in 2025 and announced a pending acquisition of For The Record, which is expected to enhance its courts and justice portfolio [28][29] - A new share repurchase program of up to $1 billion was authorized, reflecting confidence in the business trajectory [29] Q&A Session Summary Question: SaaS flips and future expectations - Management indicated that while they do not guide specific flip numbers, they expect flips to continue to grow from current levels, with a peak anticipated between 2027 and 2029 [33] Question: Annual Contract Value from new SaaS deals - Management noted that they expect SaaS bookings to grow in 2026, with Q4 showing solid sales numbers despite tough comparisons from large deals in the previous year [37] Question: State sales team performance - The state sales team has shown encouraging results, contributing to significant deals, and is expected to continue leveraging relationships for future sales [44] Question: AI partnerships and development - The company collaborates with major AI players like Anthropic, AWS, Microsoft, and OpenAI to enhance its product offerings [50] Question: Free cash flow and capital allocation - Management expects free cash flow to grow, with a focus on disciplined capital allocation between M&A opportunities and share repurchases [76][78]

Financial Data and Key Metrics Changes - Total revenues for Q4 2025 were $575.2 million, an increase of 6.3% year-over-year [11] - Recurring revenues grew by 11%, with SaaS revenue growth exceeding 20% and transaction-based revenue growth at 12% [4][12] - Free cash flow reached a record high of $236.9 million in Q4, with a free cash flow margin of 41% [4][17] - Annualized recurring revenue was approximately $2.06 billion, up 10.9% [16] Business Line Data and Key Metrics Changes - SaaS revenues grew by 20.2%, surpassing $200 million for the first time in a quarter [13] - Transaction revenues increased by 12.1% to $196.7 million, driven by higher transaction volumes and new service deployments [13] - Total SaaS bookings grew by 9.6% year-over-year, with annual contract value from flips signed in Q4 rising 64.5% compared to last year [15][16] Market Data and Key Metrics Changes - The public sector market fundamentals remain strong, with healthy budgets supporting an active pipeline [4] - RFP and sales demo activity are at elevated levels as agencies prioritize modernization of critical systems [4] Company Strategy and Development Direction - The company focuses on four key growth pillars: completing cloud transition, leveraging a large client base, growing transaction business, and expanding into new markets [6] - A unified payment strategy has been executed to capture greater value and drive operational efficiencies [6][7] - The company is transitioning to AI-enabled solutions, with plans for deeper integration into operational workflows [25][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to deliver sustained growth through competitive strengths and digital transformation initiatives [22] - The market is showing healthy demand, with strong sales activity and a high number of RFPs indicating positive future prospects [53] Other Important Information - The company announced a new share repurchase program of up to $1 billion, reflecting confidence in business trajectory [28] - The acquisition of For The Record is expected to close in Q1 2026, pending regulatory approval [21] Q&A Session Summary Question: SaaS flips and future expectations - Management expects flips to continue growing but does not provide specific guidance on flip numbers [33] Question: Annual contract value from new SaaS deals - Management anticipates growth in SaaS bookings for 2026, with Q4 being a solid sales number despite tough comparisons [36] Question: State sales team performance - The state sales team has shown good success, particularly with larger deals, and is expected to continue leveraging relationships for growth [45] Question: AI partnerships - The company collaborates with major AI players like Anthropic, AWS, Microsoft, and OpenAI for product development [50] Question: Impact of Texas contract on revenue - The Texas contract's revenue declined throughout the year, impacting Q4 results, but it was a low-margin contract [90]

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2025 Fourth Quarter Earnings Review 2026 Annual Guidance February 12, 2026 Statement Regarding Use of Non-GAAP Measures Tyler Technologies has provided in this press release financial measures that have not been prepared in accordance with generally accepted accounting principles (GAAP) and are therefore considered non-GAAP financial measures. This information includes non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, non-GAAP earnings p ...

分组1 - Tyler Technologies reported quarterly earnings of $2.64 per share, missing the Zacks Consensus Estimate of $2.71 per share, but showing an increase from $2.43 per share a year ago, resulting in an earnings surprise of -2.40% [1] - The company posted revenues of $575.18 million for the quarter ended December 2025, which was 2.45% below the Zacks Consensus Estimate and an increase from $541.13 million year-over-year [2] - Over the last four quarters, Tyler Technologies has surpassed consensus EPS estimates three times and topped consensus revenue estimates three times [2] 分组2 - The stock has underperformed, losing about 20.6% since the beginning of the year, while the S&P 500 has gained 1.4% [3] - The current consensus EPS estimate for the coming quarter is $2.98 on revenues of $609.08 million, and for the current fiscal year, it is $12.62 on revenues of $2.54 billion [7] - The Zacks Industry Rank for Internet - Software and Services is currently in the bottom 20% of over 250 Zacks industries, indicating potential challenges for stock performance [8]