Core Viewpoint - Jack Henry & Associates, Inc. has announced a 6% increase in its quarterly dividend to $0.61 per share, reflecting its commitment to returning value to shareholders and maintaining a strong dividend history [1]. Group 1: Dividend Announcement - The Board of Directors has approved a quarterly dividend increase of 6% to $0.61 per share [1]. - The cash dividend is payable on March 25, 2026, to stockholders of record as of March 5, 2026 [1]. - Jack Henry has maintained consecutive quarterly dividends since 1991, marking 2025 as the 22nd consecutive year of increasing dividends [1]. Group 2: Company Overview - Jack Henry & Associates, Inc. is a financial technology company listed on the S&P 500, focusing on enhancing connections between financial institutions and their clients [2]. - The company has been providing technology solutions for nearly 50 years, enabling clients to innovate and compete effectively [2]. - Jack Henry serves approximately 7,400 clients, offering user-centric solutions that promote financial health [2].

Revenue and Income - Revenue for the three months ended December 31, 2025, was $619.3 million, an increase of 7.9% compared to $573.8 million for the same period in 2024[15] - Net income for the three months ended December 31, 2025, was $124.7 million, representing a 27.4% increase from $97.8 million in the same period last year[15] - Basic earnings per share for the three months ended December 31, 2025, was $1.73, compared to $1.34 for the same period in 2024, reflecting a 29.1% increase[15] - Operating income for the six months ended December 31, 2025, was $343.2 million, up 25.2% from $274.3 million in the prior year[15] - Net income for the six months ended December 31, 2025, was $268,655, an increase of 23.7% compared to $217,036 for the same period in 2024[20] - For the six months ended December 31, 2025, total revenue reached $1,264,071, up 7.6% from $1,174,829 in 2024[43] - Total revenue for the three months ended December 31, 2025, was $619,334, a 7.9% increase from $573,848 in the same period of 2024[43] - Segment income for Core Payments was $111,170,000 for Q4 2025, compared to $101,283,000 in Q4 2024, reflecting a year-over-year increase of about 9.3%[94] - The total revenue for the Core Payments segment for the six months ended December 31, 2025, was $462,868,000, compared to $426,758,000 in the same period of 2024, reflecting an increase of approximately 8.5%[95] Assets and Liabilities - Total current assets decreased to $615.8 million as of December 31, 2025, from $681.5 million as of June 30, 2025, a decline of 9.6%[13] - Total liabilities decreased to $857.0 million as of December 31, 2025, from $913.1 million as of June 30, 2025, a reduction of 6.1%[13] - The company reported total assets of $3.06 billion as of December 31, 2025, slightly up from $3.04 billion as of June 30, 2025[13] - Cash and cash equivalents decreased to $28.2 million as of December 31, 2025, from $102.0 million as of June 30, 2025, a decline of 72.5%[13] - The company had $33,250 in non-current investments as of December 31, 2025, an increase from $25,750 at June 30, 2025[28] Dividends and Earnings - The company declared dividends of $0.58 per share for the three months ended December 31, 2025, compared to $0.55 per share for the same period in 2024[18] - Basic earnings per share for the fiscal six months ended December 31, 2025, was $3.71, compared to $2.98 for the same period in 2024[81] Cash Flow and Investments - Net cash from operating activities for the six months ended December 31, 2025, was $273,254, up from $206,543 in 2024, reflecting a 32.3% increase[20] - The company reported a net cash outflow from investing activities of $155,806 for the six months ended December 31, 2025, compared to an outflow of $119,800 in 2024[20] - Total cash and cash equivalents at the end of the period were $28,216, compared to $25,653 at the end of December 31, 2024[20] Tax and Interest - The effective tax rate for the fiscal three months ended December 31, 2025, was 24.1%, up from 23.2% in the prior year quarter[67] - For the fiscal six months ended December 31, 2025, the effective tax rate increased to 24.2% from 23.6% in the same period last year[68] - The Company paid income taxes of $24,835 for the fiscal six months ended December 31, 2025, compared to $65,833 for the same period in 2024[69] - The Company paid interest of $1,783 during the fiscal six months ended December 31, 2025, compared to $4,352 in the same period of 2024[66] Acquisitions and Goodwill - The acquisition of Victor Technologies, Inc. on September 30, 2025, was for $42,390, aimed at expanding capabilities in the Payments-as-a-Service market[82] - The goodwill from the Victor acquisition amounted to $22,943, expected to be deductible for income tax purposes[84] Expenses - Total expenses for the six months ended December 31, 2025, were $920,858,000, up from $900,551,000 in the same period of 2024, indicating a rise of approximately 2.5%[95] - The company reported a total cost of revenue of $699,554,000 for the six months ended December 31, 2025, compared to $676,282,000 in the same period of 2024, an increase of about 3.4%[95] - Research and development expenses for the six months ended December 31, 2025, totaled $81,505,000, slightly higher than $80,780,000 in the same period of 2024[95] Other Financial Metrics - The allowance for credit losses at the end of December 31, 2025, was $6,489, a decrease from $6,872 at the end of December 31, 2024[24] - The Company had $23,890 of gross unrecognized tax benefits as of December 31, 2025, with $21,501 potentially affecting the effective tax rate if recognized[72] - Stock-based compensation costs for the fiscal six months ended December 31, 2025, were $14,756, down from $15,539 in the same period of 2024[74] - The Company anticipates a significant reduction in cash tax payments for the current fiscal year due to changes in U.S. federal income tax law[70] Contractual Obligations - Contract assets as of December 31, 2025, included $36,860 in current and $122,708 in non-current assets, showing slight increases from June 30, 2025[45] - Contract liabilities (deferred revenue) decreased to $193,027 in current and $77,967 in non-current as of December 31, 2025, compared to $290,485 and $72,889, respectively, on June 30, 2025[45] - Estimated revenue expected to be recognized in the future related to unsatisfied performance obligations totaled $7,998,267, with approximately 23% expected to be recognized over the next 12 months[49] Share Repurchase - The company repurchased 795 shares of common stock during the first six months of fiscal 2026, with a total cost of $125,237[29] - The company has a share repurchase program with the authority to repurchase up to 2,616 additional shares as of December 31, 2025[29] Market Risks - The company does not currently use any derivative financial instruments to manage market risks, actively monitoring credit and interest risks through controlled procedures[154] - As of December 31, 2025, the company had $20,000,000 in outstanding debt with variable interest rates, with a potential increase in annual interest expense of $200 for every 1% rise in borrowing rates[155]

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]

Core Insights - Jack Henry & Associates, Inc. (JKHY) shares increased by 4.7% following the release of better-than-expected second-quarter fiscal 2026 results, with non-GAAP earnings of $1.72 per share, surpassing the Zacks Consensus Estimate by 20.28% and reflecting a year-over-year increase of 28.4% [1][10] - The company's revenues reached $619.3 million, exceeding the Zacks Consensus Estimate by 1.64% and showing a year-over-year growth of 7.9% [1][10] Revenue Breakdown - Adjusted for deconversion revenues of $8.2 million, non-GAAP revenues were $611.2 million, marking a 6.7% increase year over year [2] - Revenues from Services and Support, accounting for 55.8% of total revenues, were $345.8 million, up 7.1% year over year, driven by growth in data processing and hosting revenues [3] - Processing revenues, which made up 44.2% of total revenues, were $273.5 million, reflecting a 9.1% year-over-year increase, supported by growth in card, transaction, digital, and payment processing revenues [3] - Core segment revenues, representing 30% of total revenues, were $186.1 million, up 8.4% year over year [4] - Payments revenues, comprising 37.5% of total revenues, reached $232 million, an 8% increase year over year [4] - Complementary revenues, accounting for 29.3% of total revenues, were $181.7 million, up 9.6% year over year [4] - Corporate and Other revenues, which made up 3.2% of total revenues, were $19.6 million, down 9.8% year over year [4] Profitability Metrics - Adjusted EBITDA for the second quarter was $206.2 million, a 17.7% increase year over year, with an adjusted EBITDA margin expanding by 280 basis points to 33.3% [5] - Adjusted operating income rose by 29.4% year over year to $159.1 million, with the adjusted operating margin increasing by 430 basis points to 25.7% [5] Cash Flow and Guidance - As of September 30, 2025, cash and cash equivalents were $28 million, down from $36.2 million a year earlier [6] - In the first half of fiscal 2026, the company generated an operating cash flow of $273 million and free cash flow of $172 million [6] - For fiscal 2026, JKHY updated its GAAP revenue guidance to $2.508-$2.525 billion, an increase from the previous range of $2.49-$2.51 billion, with non-GAAP revenues estimated between $2.474-$2.491 billion [7] - The GAAP operating margin is expected to be between 24.3% and 24.5%, up from the previous guidance of 23.9%-24.1% [8] - Management anticipates GAAP earnings in the range of $6.61-$6.72 per share, an increase from the previous guidance of $6.38-$6.49 for fiscal 2026 [8]

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]

分组1 - Jack Henry reported quarterly earnings of $1.72 per share, exceeding the Zacks Consensus Estimate of $1.43 per share, and showing an increase from $1.34 per share a year ago, resulting in an earnings surprise of +20.28% [1] - The company achieved revenues of $619.33 million for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 1.64% and up from $573.85 million year-over-year [2] - Jack Henry has consistently surpassed consensus EPS estimates over the last four quarters, achieving this four times [2] 分组2 - The stock has underperformed the market with a decline of about 1.8% since the beginning of the year, while the S&P 500 has gained 1.9% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the upcoming quarter is $1.47 on revenues of $613.23 million, and for the current fiscal year, it is $6.46 on revenues of $2.5 billion [7] 分组3 - The Computers - IT Services industry, to which Jack Henry belongs, is currently ranked in the top 40% of over 250 Zacks industries, indicating a favorable outlook for the sector [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that tracking these revisions can be beneficial for investors [5] - Jack Henry holds a Zacks Rank 2 (Buy), indicating expectations for the stock to outperform the market in the near future [6]

Core Insights - Jack Henry & Associates reported a higher second-quarter profit, attributed to strong demand for its banking technology offerings [1] Company Performance - The increase in profit indicates robust performance in the banking technology sector, reflecting a positive trend in demand for such services [1]

Core Insights - Jack Henry & Associates, Inc. reported strong financial results for the second quarter of fiscal year 2026, with GAAP revenue increasing by 7.9% and GAAP operating income rising by 29.4% compared to the same quarter in the previous fiscal year [5][13] - Non-GAAP adjusted revenue grew by 6.7% and non-GAAP adjusted operating income increased by 24.3% for the same period [5][13] - The company achieved a GAAP EPS of $1.72, reflecting a growth of 28.6% year-over-year [5][11] Financial Performance - For the fiscal three months ended December 31, 2025, total revenue was $619.3 million, up from $573.8 million in the prior year, marking a 7.9% increase [7][15] - For the fiscal six months ended December 31, 2025, total revenue reached $1.264 billion, a 7.6% increase from $1.175 billion in the same period last year [7][15] - The company’s operating income for the second quarter was $159.1 million, a 29.4% increase from $123.0 million in the prior year [10][15] Segment Performance - Core segment revenue increased by 8.4% in the second quarter, while payments segment revenue rose by 8.0% [9][12] - Complementary segment revenue grew by 9.6%, whereas corporate and other segment revenue decreased by 9.8% [9][12] - For the fiscal six months, core segment revenue increased by 4.2%, payments segment revenue by 8.5%, and complementary segment revenue by 9.9% [9][12] Guidance for Fiscal Year 2026 - The company provided guidance for fiscal year 2026, projecting GAAP revenue between $2.508 billion and $2.525 billion, with an operating margin of 24.3% to 24.5% [3][31] - Non-GAAP adjusted revenue is expected to be between $2.474 billion and $2.491 billion, with a growth rate of 6.4% to 7.1% [31][32] Cash Flow and Balance Sheet - Cash and cash equivalents stood at $28.2 million as of December 31, 2025, compared to $25.7 million a year earlier [5] - The company reported outstanding debt of $20 million at the end of December 2025, significantly reduced from $150 million a year prior [5]