An updated edition of the February 4, 2026 article.Mobile payments are steadily replacing physical wallets at checkout counters, cutting reliance on cash and traditional ATM networks, even in regions that have long preferred cash. Money can now move in real time, often at a lower cost, changing how people pay and how businesses get paid. What started as a simple convenience has evolved into a major financial ecosystem built around speed, data and digital access. Mobile wallets such as Apple Pay, Google Pay ...

Core Insights - The company reported record second-quarter results for fiscal 2026, with non-GAAP revenue of $611 million, reflecting a year-over-year increase of 6.7% [3] - Total recurring revenue exceeded 92%, with cloud revenue rising 8% and accounting for 33% of total revenue [1] - GAAP revenue increased by 8% for the quarter and fiscal year-to-date, while non-GAAP revenue grew by 7% for the quarter and 8% for the year [2] Revenue and Profitability - Processing revenue, which constituted 44% of total revenue, grew by 9% on a GAAP basis and 8% on a non-GAAP basis, driven by increased digital, card, and faster payment processing revenue [1] - Non-GAAP operating margin was reported at 25.1%, representing an expansion of 355 basis points compared to the prior-year quarter [3] - GAAP EPS for the second quarter was $0.72, marking a 29% increase, while the first half of the fiscal year saw GAAP EPS rise to $3.70, a 24% increase [6] Market Position and Sales Performance - The company achieved 22 competitive core wins in the quarter, with 68% of new core wins including both digital and card solutions [5][8] - Market share among banks increased by 17% and by 40% for credit unions over the past eight years, attributed to client growth through M&A and successful "winning mergers" [10] - The company logged significant sales momentum, with a noted increase in pipeline activity following competitor consolidation [9] Product Initiatives and Innovations - The cloud-native merchant acquiring solution Tap2Local is being rolled out, with hundreds of clients live and plans to add 100-150 clients per month [4][11] - Rapid Transfers, allowing SMBs and consumers to move funds, is live with 75 clients, with 180 more in various stages of onboarding [12] - The company is beta testing USDC stablecoin payments and evaluating over 20 partners for potential collaborations [13] Segment Performance - Non-GAAP revenue for the core segment increased by 7% in the quarter, with operating margin up five basis points [17] - Payments segment non-GAAP revenue grew by 6%, with a 200 basis point expansion in operating margin, driven by resilience in card-related services [17] - Complementary segment non-GAAP revenue increased by 9%, with 58 basis points of margin expansion [17] Cash Flow and Capital Allocation - Operating cash flow was $153 million in Q2, up $63 million from the prior-year quarter, while free cash flow reached $103 million, an increase of $74 million [18] - The company highlighted $125 million in share repurchases and $84 million in dividends paid through the end of calendar 2025 [19] - Fiscal 2026 guidance was raised for the second consecutive time, reflecting strong demand trends and a robust sales pipeline [20] Future Outlook - Management expressed confidence in the remainder of fiscal 2026, citing strong competitive win rates and a healthy pipeline, while acknowledging potential headwinds from normalized medical benefit costs [20] - Guidance for GAAP revenue growth was increased to 5.6% to 6.3%, with non-GAAP revenue growth tightened to 6.4% to 7.1% [23]

Financial Data and Key Metrics Changes - The company reported record second quarter results with non-GAAP revenue of $611 million, an increase of 6.7% compared to the same quarter last year [5][21] - Non-GAAP operating margin was 25.1%, reflecting a margin expansion of 355 basis points year-over-year [6][25] - GAAP revenue increased by 8% for the quarter, while non-GAAP revenue increased by 7% for the quarter and 8% year-to-date [22][24] - Fully diluted GAAP earnings per share reached $0.72, up 29%, with a year-to-date GAAP earnings per share of $3.70, an increase of 24% [26][33] Business Line Data and Key Metrics Changes - Core segment non-GAAP revenue increased by 7% for the quarter, with operating margin increasing by five basis points [26] - Payment segment quarterly non-GAAP revenue increased by 6%, with significant growth in card-related services and faster payments [27] - Complementary segment quarterly non-GAAP revenue growth was 9%, reflecting strong demand for digital solutions and a beneficial product mix [27] Market Data and Key Metrics Changes - The number of financial institutions using Zelle grew by 22%, The Clearing House's RTP network by 26%, and FedNow by 32% [17] - Payment transaction volume through these channels increased by 49% year-over-year [17] - The company has relationships with over 80% of financial institutions in the U.S., enhancing its competitive position during market consolidation [9] Company Strategy and Development Direction - The company is focused on technology innovation, service excellence, and a people-first culture, which are key differentiators in the market [5] - Strategic initiatives include the development of cloud-native solutions like Tap2Local and Rapid Transfers, aimed at enhancing client offerings and attracting younger demographics [10][12] - The integration of Victor Technologies is progressing well, enhancing the company's embedded payments and banking-as-a-service capabilities [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong demand environment and robust sales pipeline, indicating confidence in continued growth [19][33] - The company anticipates that industry consolidation will remain neutral to slightly positive for its business, with ongoing opportunities arising from mergers and acquisitions [23][48] - Management highlighted the importance of AI in enhancing operational efficiency and product development, positioning the company favorably in the competitive landscape [42][66] Other Important Information - The company celebrated its 40th anniversary of being public and is preparing for its 50th anniversary of founding [19] - The company has increased its full-year guidance for GAAP revenue growth to a range of 5.6%-6.3% and non-GAAP revenue growth to 6.4%-7.1% [30][31] - Operating cash flow for Q2 was $153 million, a $63 million increase over the prior year [28] Q&A Session Summary Question: Expectations for Q3 sales results and impact from core consolidation news - Management noted that Q3 is starting off well, but it is too early to predict outcomes, emphasizing that Q2 results were minimally impacted by competitor announcements [36] Question: Changes in pricing for core systems and ancillary services - Management indicated that pricing has remained consistent over the past few years, with the recent wins demonstrating strong competitive positioning despite not being the lowest cost provider [38] Question: AI's impact on the business model - Management clarified that AI is being utilized to enhance technology development and operational efficiency, with a focus on integrating AI into new platform products [44][66] Question: Outlook on bank M&A and its impact on revenue - Management remains optimistic that bank M&A will be net neutral to positive, with ongoing opportunities arising from mergers and acquisitions [48] Question: Performance of revenue segments and expectations for the second half - Management expressed satisfaction with performance across all segments, noting that while the second half may present challenges, core and complementary segments are expected to continue performing well [53][56]

Financial Data and Key Metrics Changes - The company reported record second quarter results with non-GAAP revenue of $611 million, an increase of 6.7% compared to the same quarter last year [5][22] - Non-GAAP operating margin was 25.1%, reflecting a margin expansion of 355 basis points year-over-year [6][26] - GAAP revenue increased by 8% for the quarter, while non-GAAP revenue increased by 7% for the quarter and 8% year-to-date [22][26] - Fully diluted GAAP earnings per share reached $0.72, up 29%, with a year-to-date GAAP earnings per share of $3.70, an increase of 24% [26][33] Business Line Data and Key Metrics Changes - Core segment non-GAAP revenue increased by 7% for the quarter, with operating margin increasing by five basis points [26] - Payment segment non-GAAP revenue increased by 6%, with significant growth in card-related services and faster payments [26] - Complementary segment saw a 9% increase in non-GAAP revenue, with a healthy 58 basis points of margin expansion [26] Market Data and Key Metrics Changes - The number of financial institutions using Zelle grew by 22%, RTP network by 26%, and FedNow by 32% over the past year [17] - Payment transaction volume through these channels increased by 49% year-over-year [17] - The company has relationships with over 80% of financial institutions in the U.S., enhancing its competitive position during market consolidation [9] Company Strategy and Development Direction - The company is focused on technology innovation, service excellence, and a people-first culture, which are key differentiators in the market [5] - Strategic initiatives include the rollout of cloud-native solutions like Tap2Local and Rapid Transfers, aimed at enhancing client offerings and capturing market share [10][12] - The integration of Victor Technologies is progressing well, enhancing embedded payments and banking-as-a-service capabilities [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong demand environment and robust sales pipeline, indicating confidence in continued growth [19][33] - The company anticipates that industry consolidation will remain neutral to slightly positive for its business, with ongoing opportunities arising from mergers and acquisitions [23][48] - Management highlighted the importance of AI in enhancing operational efficiency and product development, positioning the company favorably in the competitive landscape [42][66] Other Important Information - The company celebrated its 40th anniversary of being public and is preparing for its 50th anniversary of founding [19] - The company has increased its full-year guidance for GAAP revenue growth to a range of 5.6%-6.3% and non-GAAP revenue growth to 6.4%-7.1% [30][31] - Operating cash flow for Q2 was $153 million, a $63 million increase over the prior year [28] Q&A Session Summary Question: Expectations for Q3 sales results and impact from core consolidation news - Management noted that Q3 is starting off well, but it is too early to predict if it will exceed Q2 results, with a growing pipeline of opportunities [36][37] Question: Changes in pricing for core systems and ancillary services - Management indicated that pricing has remained consistent over the last couple of years, with no significant changes due to competitive announcements [38] Question: AI's impact on the business model - Management emphasized that AI is being integrated into product development and operational efficiency, which is expected to enhance the company's competitive position [42][66] Question: Outlook on bank M&A and its impact - Management remains optimistic that bank M&A will be net neutral to positive, with opportunities arising from conversion merge activities [48] Question: Performance of revenue segments and expectations for the second half - Management reported strong performance across all segments, with expectations for some challenges in the payments segment in the second half [53][54] Question: Clarification on margin performance and medical insurance claims - Management acknowledged that lower medical insurance claims contributed to margin performance but does not expect this to continue in the second half [58][59] Question: Competitive dynamics in payments and card processing - Management noted that while new entrants are emerging, they have not disrupted the market significantly, and the company continues to see success in its solution offerings [74]

Financial Data and Key Metrics Changes - The company reported record second quarter results with non-GAAP revenue of $611 million, an increase of 6.7% compared to the same quarter last year [4] - Non-GAAP operating margin was 25.1%, reflecting a margin expansion of 355 basis points year-over-year [4][24] - GAAP revenue increased by 8% for the quarter, while non-GAAP revenue increased by 7% [19] - Fully diluted GAAP earnings per share reached $0.72, up 29% year-over-year [24] Business Line Data and Key Metrics Changes - Core segment non-GAAP revenue increased by 7% for the quarter, with operating margin increasing by five basis points [24] - Payment segment non-GAAP revenue grew by 6%, with significant growth in card-related services and faster payments [24] - Complementary segment non-GAAP revenue increased by 9%, reflecting strong demand for digital solutions [24] Market Data and Key Metrics Changes - The company has seen a 22% increase in the number of financial institutions using Zelle, a 26% increase in the RTP network, and a 32% increase in FedNow [15] - Payment transaction volume through these channels increased by 49% year-over-year [15] - The company has relationships with over 80% of financial institutions in the U.S., enhancing its market position during consolidation events [7] Company Strategy and Development Direction - The company is focusing on technology modernization and innovation, with a strong emphasis on cloud-native solutions and embedded payments [11][12] - The acquisition of Victor Technologies is progressing well, enhancing the company's capabilities in embedded payments and banking-as-a-service [11] - The company aims to leverage its technology to help financial institutions grow revenue and compete effectively in a consolidating market [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong demand environment and robust sales pipeline, indicating confidence in continued growth [17] - The company anticipates that the second half of fiscal 2026 will see lower non-GAAP revenue growth compared to the first half, primarily due to anticipated slower momentum in one-time revenue and card [28] - Management highlighted the importance of consistent execution and maintaining a people-first culture as key differentiators in the competitive landscape [4][17] Other Important Information - The company celebrated its 40th anniversary of being public and is preparing for its 50th anniversary of founding [17] - The company has increased its full-year guidance for GAAP revenue growth to a range of 5.6%-6.3% and non-GAAP revenue growth to 6.4%-7.1% [27][28] Q&A Session Summary Question: Expectations for Q3 sales results and impact from core consolidation news - Management noted that Q3 is starting off well, but it is too early to predict if results will exceed Q2 [32] Question: Changes in pricing for core systems and ancillary services - Management indicated that pricing has remained consistent over the last couple of years, with no significant changes due to recent announcements [34] Question: AI's impact on the business model - Management emphasized that AI is being utilized to enhance technology development and operational efficiency, but it is not a straightforward process [40][62] Question: Outlook on bank M&A and its impact - Management remains optimistic that bank M&A will be neutral to positive for the business, with opportunities arising from mergers [43] Question: Performance of different segments and expectations for the second half - Management expressed satisfaction with performance across all segments but anticipates challenges in the payments segment in the second half [50][51]

Cloud-native merchant acquiring solution is part of Jack Henry's SMB strategy MONETT, Mo., Aug. 14, 2025 /PRNewswire/ -- Jack Henry™ (Nasdaq: JKHY) today announced the initial launch of Tap2Local™, a new digital payments solution that enables banks and credit unions to meet the evolving needs of their small and medium-sized business (SMB) customers. Developed in collaboration with Moov, a modern digital payments processor, the cloud-native Tap2Local solution offers merchants many distinguishing features. Th ...