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 [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]