Mimi L. Carsley|Chief Financial
: • GAAP revenue increased 8.8% and GAAP operating income increased 12.5% for the fiscal three months ended September 30, 2026, compared to the prior fiscal year quarter.
• Non-GAAP adjusted revenue increased 7.2% and non-GAAP adjusted operating income increased 11.2% for the fiscal three months ended September 30, 2026, compared to the prior fiscal year quarter. 1
• GAAP EPS was $2.28 per diluted share for the fiscal three months ended September 30, 2026, compared to $1.97 per diluted share in the prior fiscal year quarter, representing growth of 15.6%.
Cash and cash equivalents were $25.4 million at September 30, 2026, and $36.2 million at September 30, 2025.
• Debt outstanding for credit facilities was $85 million at September 30, 2026, and $20 million at September 30, 2025.
• Stock repurchases for the fiscal three months ended September 30, 2026, were $71 million at an average price of $153.47 per share.
First Qtr Revenue First Qtr Operating Income GAAP Non-GAAP1 GAAP Non-GAAP1 increased increased increased increased 8.8% 7.2% 12.5% 11.2% First Qtr Net Income First Qtr EBITDA GAAP Non-GAAP1 Non-GAAP2 increased increased increased 11.4% 10.1% 10.2%
Full year fiscal 2027 guidance (Dollars in millions, other than per share amounts) :
Current GAAP Low High Revenue $2,698 $2,718 Operating margin4 24.7% 24.9% EPS $7.47 $7.51 Non-GAAP5 Adjusted revenue $2,667 $2,687 Adjusted operating margin 24.1% 24.3%
- Jack Henry & Associates, Inc. (Nasdaq: JKHY), a leading financial technology provider, today announced results for fiscal first quarter ended September 30, 2026.
According toGreg Adelson, President and CEO,“We continued our positive momentum in the first quarter of fiscal 2027, delivering record financial results that exceeded the outlook we provided in August. The demand environment remains very strong, as reflected in our outstanding sales performance and robust pipeline. We are extremely pleased with the start of our fiscal year and based on improved revenue drivers, we again exceeded consensus expectations. We are confident in our ability to continue delivering consistent, long-term results through an unwavering commitment to culture, service, innovation, strategy, and execution.”
3 The full fiscal year guidance assumes no acquisitions or dispositions will be made during fiscal year 2027.
5 See tables below on page 7 reconciling fiscal year 2027 GAAP to non-GAAP guidance.
Revenue, operating expenses, operating income, and net income for the fiscal three months ended September 30, 2026, compared to the fiscal three months ended September 30, 2025, were as follows:
• Services and support revenue increased for the fiscal three months ended September 30, 2026, compared to the fiscal three months ended September 30, 2025, primarily driven by growth in hosting revenue of 11.7% as new and existing clients continue to migrate to our private cloud and processing volumes expand, an increase in deconversion revenue of $9,292, as well as an increase in software usage revenue of 9.9%, partially offset by the decrease in revenue related to the timing of our Connect conference, which was held in the first quarter of fiscal 2026 and the second quarter of 2027. Processing revenue increased for the fiscal three months ended September 30, 2026, compared to the fiscal three months ended September 30, 2025, mainly driven by growth in card revenue of 9.4% from monthly service and risk management fees, improvement in digital and transaction revenue of 13.3% from a higher number of active users on our digital platform and from the ramping up of additional products, as well as a rise in faster payments revenue of 43.8% from expanding transactional volumes.
• For the fiscal three months ended September 30, 2026, compared to the fiscal three months ended September 30, 2025, core segment revenue increased 7.1%, payments segment revenue increased 9.2%, complementary segment revenue increased 10.4%, and corporate services segment revenue increased 6.2%. For the fiscal three months ended September 30, 2026, compared to the fiscal three months ended September 30, 2025, core segment non-GAAP adjusted revenue increased 4.9%, payments segment non-GAAP adjusted revenue increased 8.3%, complementary segment non-GAAP adjusted revenue increased 8.4%, and corporate services non-GAAP adjusted segment revenue increased 5.2%. Total non-GAAP adjusted revenue increased 7.2% for the same comparative periods (see revenue lines of segment break-out tables on pages 5 and 6 below for a reconciliation of GAAP segment revenue to non-GAAP adjusted segment revenue).
• Cost of revenue increased for the fiscal three months ended September 30, 2026, compared to the fiscal three months ended September 30, 2025, primarily due to higher personnel costs, including compensation and benefit costs, partly related to trailing twelve month headcount growth, higher direct costs generally consistent with increases in related lines of revenue, higher cloud consumption costs, including artificial intelligence and security costs, increased licenses and fees, including infrastructure costs, as well as higher amortization of intangibles, partially offset by the increase in labor cost deferral.
• Research and development expense increased for the fiscal three months ended September 30, 2026, compared to the fiscal three months ended September 30, 2025, primarily due to higher personnel costs (net of capitalization), including compensation and benefit costs, partly related to trailing twelve month headcount growth.
• Selling, general, and administrative expense decreased for the fiscal three months ended September 30, 2026, compared to the fiscal three months ended September 30, 2025, mainly due to lower expenses related to the timing of our Connect conference.
• Effective tax rates for the fiscal three months ended September 30, 2026, and September 30, 2025, were 23.8% and 24.3%, respectively.
According toMimi Carsley, CFO and Treasurer,“During the first quarter of the fiscal year, we delivered solid 7.2% non-GAAP revenue growth aided by key areas such as Cloud, Card, and Digital, with continued Faster Payments momentum. Revenue growth and leverage in our business model contributed to non-GAAP operating income margin of 28.2% and an outstanding ROIC of 23.2%”
6 Operating margin is calculated by dividing operating income by revenue. Operating margin plus operating expense components as a percentage of total revenue may not equal 100% due to rounding.
The tables below show our revenue, operating income, and net income for the fiscal three months ended September 30, 2026, compared to the fiscal three months ended September 30, 2025, excluding the impacts of deconversions and the effects of the prior fiscal year acquisition of Victor Technologies in the current fiscal quarter ended September 30, 2026, and the impacts of deconversions and the gain on assets, net, in the prior fiscal quarter ended September 30, 2025.
*GAAP revenue is comprised of services and support and processing revenues (see page 2). Services and support revenue less deconversion revenue for the fiscal three months ended September 30, 2026, and 2025, which was $17,918 for the current fiscal year quarter and $8,626 for the prior fiscal year quarter, results in non-GAAP adjusted services and support revenue growth of 5.1% compared to the prior fiscal year quarter. Processing revenue less revenue excluding the effects of a prior year acquisition for the fiscal three months ended September 30, 2026, of $1,451, results in non-GAAP adjusted processing revenue growth of 10.2% compared to the prior fiscal year quarter.
**Non-GAAP adjusted operating margin is calculated by dividing non-GAAP adjusted operating income by non-GAAP adjusted revenue.
***The non-GAAP net income adjustments below are first listed before tax and then the tax impact is presented as a combined tax impact of all adjustments. The tax impact of adjustments is calculated using a tax rate of 24% for the fiscal three months ended September 30, 2026, and 2025. The tax rate for non- GAAP adjustment items takes a broad look at the Company's recurring tax adjustments and applies them to non-GAAP revenue that does not have its own specific tax impacts.
The tables below show the segment break-out of revenue and cost of revenue for each period presented, as adjusted for the items above, and include a reconciliation to non-GAAP adjusted operating income presented above.
*Revenue non-GAAP adjustments for the Payments segment were ($1,451) of revenue related to the acquired company and ($4,313) of deconversion revenue. Revenue non-GAAP adjustments for the remainder of the segments were deconversion revenue. Cost of revenue non-GAAP adjustments for the Payments segment were ($1,427) of costs related to the acquired company and ($164) of deconversion costs. Cost of revenue non-GAAP adjustments for the Corporate Services segment were ($105) of costs related to the acquired company and ($9) of deconversion costs. Cost of revenue non-GAAP adjustments for the remainder of the segments were deconversion costs.
**Segment income margin is calculated by dividing segment income by revenue for each segment. Non-GAAP adjusted segment income margin is calculated by dividing non-GAAP adjusted segment income by non-GAAP adjusted revenue for each segment.
***Non-GAAP adjustments unassigned to a segment were deconversion costs of $1,212, research and development costs related to the acquired company of $658, and selling, general, and administrative costs related to the acquired company of $20.
*Revenue non-GAAP adjustments for the segments were deconversion revenue. Cost of revenue non-GAAP adjustments for the segments were deconversion costs.
**Segment income margin is calculated by dividing segment income by revenue for each segment. Non-GAAP adjusted segment income margin is calculated by dividing non-GAAP adjusted segment income by non-GAAP adjusted revenue for each segment.
***Non-GAAP adjustments unassigned to a segment were a gain on assets, net, of $3,796 less deconversion costs of $621.
The table below shows our GAAP to non-GAAP guidance for the fiscal year ending June 30, 2027. Fiscal year 2027 non-GAAP guidance excludes the impacts of deconversion revenue and related operating expenses, acquisition revenues and related operating expenses, and the gain on assets, net, and assumes no additional acquisitions or dispositions will be made during the fiscal year.
*Deconversion revenue and related operating expenses are based on actual results for the fiscal three months ended September 30, 2026, and estimates for the remainder of the fiscal year 2027. See the Company’s Form 8-K filed with the Securities and Exchange Commission on October 29, 2026.
**GAAP to Non-GAAP revenue, operating expenses, and operating income may not foot due to rounding.
• Cash and cash equivalents were $25 million at September 30, 2026, compared to $36 million at September 30, 2025.
• Trade receivables were $346 million at September 30, 2026, and $308 million at September 30, 2025.
• The Company had $85 million of borrowings at September 30, 2026, compared to $20 million of borrowings at September 30, 2025.
• Deferred revenue was $333 million at September 30, 2026, compared to $321 million at September 30, 2025.
• Stockholders' equity decreased to $2,100 million at September 30, 2026, compared to $2,173 million at September 30, 2025.
* See table below for Net Cash From Operating Activities and on page 13 for Return on Average Stockholders’ Equity. Tables reconciling the non-GAAP measures Free Cash Flow and Net Operating Profit After Tax Return on Invested Capital (NOPAT ROIC) to GAAP measures are on pages 13 and 14. See the Use of Non-GAAP Financial Information section below for the definitions of Free Cash Flow and NOPAT ROIC.
*For the fiscal three months ended September 30, 2026, the change in other assets and liabilities includes the change in accrued expenses of $(34,551), the change in prepaid expenses, deferred costs and other of $(31,640), and the change in accounts payable of $(4,123), partially offset by the change in income taxes of $35,821. For the fiscal three months ended September 30, 2025, the change in other assets and liabilities includes the change in accrued expenses of $(36,567), the change in prepaid expenses, deferred costs and other of $(34,336), the change in income taxes of $(9,150), and the change in accounts payable of $(6,637).
(Unaudited, dollars in Three Months Ended thousands) September 30, 2026 2025 ────────────────────────────────────────────────────────────────────────────── Borrowings on credit $ 188,000 $ 20,000 facilities Repayments on credit -143,000 — facilities Purchase of treasury stock -70,903 -62,045 Dividends paid -42,768 -42,145 Net cash from issuance of stock and tax -3,961 -3,611 related to stock-based compensation NET CASH FROM FINANCING $ -72,632 $ -87,801 ACTIVITIES
Generally Accepted Accounting Principles (GAAP) is the term used to refer to the standard framework of guidelines for financial accounting in the United States. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizing transactions in the preparation of financial statements. In addition to reporting financial results in accordance with GAAP, we have provided certain non-GAAP financial measures, including adjusted revenue, adjusted segment revenue, adjusted operating income, adjusted segment income, adjusted cost of revenue, adjusted segment cost of revenue, adjusted operating expenses, adjusted operating margin, adjusted segment income margin, non-GAAP earnings before interest, taxes, depreciation, and amortization (non- GAAP EBITDA), free cash flow, free cash flow conversion, net operating profit after tax return on invested capital (NOPAT ROIC), and non-GAAP adjusted net income. We also present key revenue, which is the sum of cloud services revenue and processing revenue, and non-key revenue, which is all other GAAP revenue. Key revenue and non-key revenue are components of GAAP revenue and are presented because management views key revenue as the strategic recurring revenue of the business most important for long-term growth.
We believe non-GAAP financial measures help investors better understand the underlying fundamentals and operating performance of our business. Adjusted revenue, adjusted segment revenue, adjusted operating income, adjusted operating margin, adjusted segment income, adjusted segment income margin, adjusted cost of revenue, adjusted segment cost of revenue, adjusted operating expenses, and adjusted net income eliminate deconversion revenue and associated costs, the gain on assets, net, and an acquisition, which management believes are not indicative of the Company's operating performance. Such adjustments give investors further insight into our performance. Non-GAAP EBITDA is defined as net income attributable to the Company before the effect of interest income, net, taxes, depreciation, and amortization, adjusted for net income before the effect of interest income, net, taxes, depreciation, and amortization attributable to eliminated deconversions, the gain on assets, net, and an acquisition. Free cash flow is defined as net cash from operating activities, less capitalized expenditures, internal use software, and capitalized software, plus proceeds from the sale of assets. NOPAT ROIC is defined as operating income for the trailing four quarters multiplied by one minus the average effective tax rate (ETR) for the trailing four quarters, with the result divided by average invested capital (average of the beginning and ending period balances). Free cash flow conversion is defined as free cash flow, less proceeds from sale of assets, divided by net income. Management believes that non-GAAP EBITDA is an important measure of the Company’s overall operating performance and excludes certain costs and other transactions that management does not consider indicative of the Company's ongoing operating performance; free cash flow is useful to measure the funds generated in a given period that are available for debt service requirements and strategic capital decisions; free cash flow conversion is useful to measure the efficiency with which operating results are converted into free cash flow; and NOPAT ROIC is a measure of the Company’s allocation efficiency and effectiveness of its invested capital. For these reasons, management also uses these non-GAAP financial measures in its assessment and management of the Company's performance.
Non-GAAP financial measures used by the Company may not be comparable to similarly titled non-GAAP measures used by other companies. Non-GAAP financial measures have no standardized meaning prescribed by GAAP and therefore, are unlikely to be comparable with calculations of similar measures for other companies.
Any non-GAAP financial measures should be considered in context with the GAAP financial presentation and should not be considered in isolation or as a substitute for GAAP measures. Reconciliations of the non-GAAP financial measures to related GAAP measures are included.
About Jack Henry & Quarterly Associates, Conference Call Inc.® Jack Henry®(Nasdaq: JKHY) is a well-rounded financial technology company that strengthens connections between financial institutions and the people and businesses they serve. We are an S&P 500 company that prioritizes openness, collaboration, and user centricity — offering banks and credit unions a vibrant ecosystem of The Company will internally hold a conference developed call on November modern 4, 2026, at 7:45 capabilities as a.m. Central well as Time, and the ability to investors are integrate with invited to listen leading atwww.jackhenry.… fintechs. For A webcast replay 50 years, Jack will be available Henry has approximately one provided hour after the technology event solutions to atir.jackhenry.c… enable will remain clients to available for one innovate year. faster, strategically differentiate, and successfully compete while serving the evolving needs of their accountholders. We empower approximately 7,200 clients with people-inspired innovation, personal service, and insight-driven solutions that help reduce the barriers to financial health. Additional information is available atwww.jackhenr… Statements made in this news release that are not historical facts, including the Company's fiscal 2027 guidance and statements regarding future performance, are "forward-looki… statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Because forward-looking statements relate to the future, they are subject to inherent risks and uncertainties that could cause actual results to differ materially from those expressed or MEDIA CONTACT implied by such statements. Such risks and uncertainties include, but are not limited to, those discussed in the Company's Securities and Exchange Commission filings, including the Company's most recent reports on Form 10-K and Form 10-Q, particularly under the heading Risk Factors. Any forward-looking statement made in this news release speaks only as of the date of the news release, and the Company expressly disclaims any obligation to publicly update or revise any forward-looking statement, whether because of new information, future events or otherwise. Jeremy Elwood Corporate Communications Jack Henry & Associates, Inc. 417-235-6652 JDElwood@jackhe… ANALYST CONTACT Vance Sherard, CFA Investor Relations Jack Henry & Associates, Inc. 417-235-6652 VSherard@jackhe…
Why does Core segment revenue growth appear to have moderated this quarter? • The current quarter is being compared against a prior year period that included elevated one-time revenues from on-premise implementations and consulting engagements. Excluding those one-time items, growth in key recurring areas of the Core segment grew 8.6%, which is a positive indicator of the ongoing strength of the segment. 2. Why did the Company rename "Public and Private Cloud" revenue to "Cloud Services"? • The Company made this change beginning in the first quarter of fiscal 2027 to simplify presentation and improve clarity. This does not represent any change to the products or services we offer or to previously reported financial results, and prior period amounts are presented on a consistent basis.
• During the first quarter of fiscal 2027, the Company transferred a product from the Core segment to the Complementary segment for better alignment. Therefore, first quarter of fiscal 2026 results were recast. Revenue of $5,292 and cost of revenue of $746 were reclassified. Other reclassifications unrelated to the product transfer noted above were $757 of cost of revenue reclassified from Core to Corporate Services to align with current allocation of cost of revenue by segment. These changes are segment-level only and do not affect consolidated results.
• The Connect Conference is Jack Henry's annual client conference. The revenue and expenses associated with the conference are included in the Corporate Services segment. The event was held in the first quarter of fiscal 2026 and is in the the second quarter of fiscal 2027. The event will be held in the second quarter for the next four years.
Full text with the tables
Press Release
Mimi L. Carsley|Chief Financial
Officer|mcarsley@jackhenry.com
FOR IMMEDIATE RELEASE
Jack Henry & Associates, Inc. Reports First Quarter Fiscal 2027 Results
First quarter summary
:
• GAAP revenue increased 8.8% and GAAP operating income increased 12.5% for the
fiscal three months ended September 30, 2026, compared to the prior fiscal year
quarter.
• Non-GAAP adjusted revenue increased 7.2% and non-GAAP adjusted operating
income increased 11.2% for the fiscal three months ended September 30, 2026,
compared to the prior fiscal year quarter. 1
• GAAP EPS was $2.28 per diluted share for the fiscal three months ended
September 30, 2026, compared to $1.97 per diluted share in the prior fiscal year
quarter, representing growth of 15.6%.
•
Cash and cash equivalents were $25.4 million at September 30, 2026, and $36.2
million at September 30, 2025.
• Debt outstanding for credit facilities was $85 million at September 30, 2026,
and $20 million at September 30, 2025.
• Stock repurchases for the fiscal three months ended September 30, 2026, were
$71 million at an average price of $153.47 per share.
Compared to the same period in the prior fiscal year:
First Qtr Revenue First Qtr Operating Income
GAAP Non-GAAP1 GAAP Non-GAAP1
increased increased increased increased
8.8% 7.2% 12.5% 11.2%
First Qtr Net Income First Qtr EBITDA
GAAP Non-GAAP1 Non-GAAP2
increased increased increased
11.4% 10.1% 10.2%
Full year fiscal 2027 guidance (Dollars in millions, other than per share
amounts) :
3
Current
GAAP Low High
Revenue $2,698 $2,718
Operating margin4 24.7% 24.9%
EPS $7.47 $7.51
Non-GAAP5
Adjusted revenue $2,667 $2,687
Adjusted operating margin 24.1% 24.3%
Monett, MO, November 3, 2026
- Jack Henry & Associates, Inc. (Nasdaq: JKHY), a leading financial technology
provider, today announced results for fiscal first quarter ended September 30,
2026.
According toGreg Adelson, President and CEO,“We
continued our positive momentum in the first
quarter of fiscal 2027, delivering record
financial results that exceeded the outlook we
provided in August. The demand environment remains
very strong, as reflected in our outstanding sales
performance and robust pipeline. We are extremely
pleased with the start of our fiscal year and
based on improved revenue drivers, we again
exceeded consensus expectations. We are confident
in our ability to continue delivering consistent,
long-term results through an unwavering commitment
to culture, service, innovation, strategy, and
execution.”
1 See tables below on page 4 reconciling non-GAAP financial measures to GAAP.
2 See table below on page 13 reconciling net income to non-GAAP EBITDA.
3 The full fiscal year guidance assumes no acquisitions or dispositions will be
made during fiscal year 2027.
4 Operating margin is calculated by dividing operating income by revenue.
5 See tables below on page 7 reconciling fiscal year 2027 GAAP to non-GAAP
guidance.
1
Operating Results
Revenue, operating expenses, operating income, and net income for the fiscal
three months ended September 30, 2026, compared to the fiscal three months ended
September 30, 2025, were as follows:
Revenue Three
(Unaudit… Months
dollars Ended
in September
thousand… 30,
Revenue 2026 2025 % Change
──────────────────────────────────────────────────────────────────────────────
Services
and $ 404,961 $ 376,851 7.5 %
Support
Percenta…
of Total 57.7 % 58.5 %
Revenue
Processi… 296,586 267,887 10.7 %
Percenta…
of Total 42.3 % 41.5 %
Revenue
REVENUE $ 701,547 $ 644,738 8.8 %
• Services and support revenue increased for the fiscal three months ended
September 30, 2026, compared to the fiscal three months ended September 30,
2025, primarily driven by growth in hosting revenue of 11.7% as new and existing
clients continue to migrate to our private cloud and processing volumes expand,
an increase in deconversion revenue of $9,292, as well as an increase in
software usage revenue of 9.9%, partially offset by the decrease in revenue
related to the timing of our Connect conference, which was held in the first
quarter of fiscal 2026 and the second quarter of 2027. Processing revenue
increased for the fiscal three months ended September 30, 2026, compared to the
fiscal three months ended September 30, 2025, mainly driven by growth in card
revenue of 9.4% from monthly service and risk management fees, improvement in
digital and transaction revenue of 13.3% from a higher number of active users on
our digital platform and from the ramping up of additional products, as well as
a rise in faster payments revenue of 43.8% from expanding transactional volumes.
• For the fiscal three months ended September 30, 2026, compared to the fiscal
three months ended September 30, 2025, core segment revenue increased 7.1%,
payments segment revenue increased 9.2%, complementary segment revenue increased
10.4%, and corporate services segment revenue increased 6.2%. For the fiscal
three months ended September 30, 2026, compared to the fiscal three months ended
September 30, 2025, core segment non-GAAP adjusted revenue increased 4.9%,
payments segment non-GAAP adjusted revenue increased 8.3%, complementary segment
non-GAAP adjusted revenue increased 8.4%, and corporate services non-GAAP
adjusted segment revenue increased 5.2%. Total non-GAAP adjusted revenue
increased 7.2% for the same comparative periods (see revenue lines of segment
break-out tables on pages 5 and 6 below for a reconciliation of GAAP segment
revenue to non-GAAP adjusted segment revenue).
2
Operating
Expenses
and
Operating Three
Income Months
(Unaudited, Ended
dollars in September
thousands) 30, 2026 2025 % Change
──────────────────────────────────────────────────────────────────────────────
Cost of $ 376,046 $ 348,566 7.9 %
Revenue
Percentage
of Total 53.6 % 54.1 %
Revenue6
Research
and 45,781 39,278 16.6 %
Development
Percentage
of Total 6.5 % 6.1 %
Revenue6
Selling,
General, 72,649 72,829 -0.2 %
and
Administra…
Percentage
of Total 10.4 % 11.3 %
Revenue6
OPERATING 494,476 460,673 7.3 %
EXPENSES
OPERATING $ 207,071 $ 184,065 12.5 %
INCOME
Operating 29.5 % 28.5 %
Margin6
• Cost of revenue increased for the fiscal three months ended September 30,
2026, compared to the fiscal three months ended September 30, 2025, primarily
due to higher personnel costs, including compensation and benefit costs, partly
related to trailing twelve month headcount growth, higher direct costs generally
consistent with increases in related lines of revenue, higher cloud consumption
costs, including artificial intelligence and security costs, increased licenses
and fees, including infrastructure costs, as well as higher amortization of
intangibles, partially offset by the increase in labor cost deferral.
• Research and development expense increased for the fiscal three months ended
September 30, 2026, compared to the fiscal three months ended September 30,
2025, primarily due to higher personnel costs (net of capitalization), including
compensation and benefit costs, partly related to trailing twelve month
headcount growth.
• Selling, general, and administrative expense decreased for the fiscal three
months ended September 30, 2026, compared to the fiscal three months ended
September 30, 2025, mainly due to lower expenses related to the timing of our
Connect conference.
Net Income
(Unaudited,
dollars in
thousands, Three Months
except per Ended
share data) September 30, 2026 2025 % Change
──────────────────────────────────────────────────────────────────────────────
Income Before $ 210,635 $ 190,318 10.7 %
Income Taxes
Provision for 50,223 46,332 8.4 %
Income Taxes
NET INCOME $ 160,412 $ 143,986 11.4 %
Diluted
earnings per $ 2.28 $ 1.97 15.6 %
share
• Effective tax rates for the fiscal three months ended September 30, 2026, and
September 30, 2025, were 23.8% and 24.3%, respectively.
According toMimi Carsley, CFO and
Treasurer,“During the first quarter of the fiscal
year, we delivered solid 7.2% non-GAAP revenue
growth aided by key areas such as Cloud, Card, and
Digital, with continued Faster Payments momentum.
Revenue growth and leverage in our business model
contributed to non-GAAP operating income margin of
28.2% and an outstanding ROIC of 23.2%”
6 Operating margin is calculated by dividing operating income by revenue.
Operating margin plus operating expense components as a percentage of total
revenue may not equal 100% due to rounding.
3
Impact of Non-GAAP Adjustments
The tables below show our revenue, operating income, and net income for the
fiscal three months ended September 30, 2026, compared to the fiscal three
months ended September 30, 2025, excluding the impacts of deconversions and the
effects of the prior fiscal year acquisition of Victor Technologies in the
current fiscal quarter ended September 30, 2026, and the impacts of
deconversions and the gain on assets, net, in the prior fiscal quarter ended
September 30, 2025.
Three
Months
(Unaudited, Ended
dollars in September
thousands) 30, 2026 2025 % Change
──────────────────────────────────────────────────────────────────────────────
GAAP $ 701,547 $ 644,738 8.8 %
Revenue*
Adjustment…
Deconversi… -17,918 -8,626
revenue
Revenue
from the -1,451 —
acquisition
NON-GAAP
ADJUSTED $ 682,178 $ 636,112 7.2 %
REVENUE*
GAAP
Operating $ 207,071 $ 184,065 12.5 %
Income
Adjustment…
Operating
income from -15,199 -7,101
deconversi…
Gain on — -3,796
assets, net
Operating
loss from 759 —
the
acquisition
NON-GAAP
ADJUSTED $ 192,631 $ 173,168 11.2 %
OPERATING
INCOME
Non-GAAP
Adjusted 28.2 % 27.2 %
Operating
Margin**
GAAP Net $ 160,412 $ 143,986 11.4 %
Income
Adjustment…
Net income
from -15,199 -7,101
deconversi…
Gain on — -3,796
assets, net
Net loss
from the 759 —
acquisition
Tax impact
of 3,466 2,615
adjustments
NON-GAAP
ADJUSTED $ 149,438 $ 135,704 10.1 %
NET INCOME
*GAAP revenue is comprised of services and support and processing revenues (see
page 2). Services and support revenue less deconversion revenue for the fiscal
three months ended September 30, 2026, and 2025, which was $17,918 for the
current fiscal year quarter and $8,626 for the prior fiscal year quarter,
results in non-GAAP adjusted services and support revenue growth of 5.1%
compared to the prior fiscal year quarter. Processing revenue less revenue
excluding the effects of a prior year acquisition for the fiscal three months
ended September 30, 2026, of $1,451, results in non-GAAP adjusted processing
revenue growth of 10.2% compared to the prior fiscal year quarter.
**Non-GAAP adjusted operating margin is calculated by dividing non-GAAP adjusted
operating income by non-GAAP adjusted revenue.
***The non-GAAP net income adjustments below are first listed before tax and
then the tax impact is presented as a combined tax impact of all adjustments.
The tax impact of adjustments is calculated using a tax rate of 24% for the
fiscal three months ended September 30, 2026, and 2025. The tax rate for non-
GAAP adjustment items takes a broad look at the Company's recurring tax
adjustments and applies them to non-GAAP revenue that does not have its own
specific tax impacts.
4
The tables below show the segment break-out of revenue and cost of revenue for
each period presented, as adjusted for the items above, and include a
reconciliation to non-GAAP adjusted operating income presented above.
Th…
Mo…
En…
Se…
30,
20…
──────────────────────────────────────────────────────────────────────────────
(…
d… Co… Pa… Co… Co… To…
in Se…
t…
G… $ 20… $ 25… $ 22… $ 25,… $ 701…
R…
N… -7… -5… -5… -289 -19…
a…
N…
A… 19… 24… 21… 25,… 682…
R…
G…
C… 76… 12… 74… 99,… 376…
OF
R…
N… -8… -1… -4… -114 -3,…
a…
N…
A…
C… 75… 12… 74… 99,… 373…
OF
R…
G…
S… $ 12… $ 12… $ 14… $ -73…
I…
S…
I… 62… % 50… % 66… % -28… %
M…
N…
A… $ 12… $ 12… $ 13… $ -74…
S…
I…
N…
A…
S… 61… % 49… % 65… % -28… %
I…
M…
R…
a… 45,…
D…
S…
G… 72,…
a…
A…
N…
a…
u… -1,…
to
a
s…
N…
T…
A… 489…
O…
E…
N…
A… $ 192…
O…
I…
*Revenue non-GAAP adjustments for the Payments segment were ($1,451) of revenue
related to the acquired company and ($4,313) of deconversion revenue. Revenue
non-GAAP adjustments for the remainder of the segments were deconversion
revenue. Cost of revenue non-GAAP adjustments for the Payments segment were
($1,427) of costs related to the acquired company and ($164) of deconversion
costs. Cost of revenue non-GAAP adjustments for the Corporate Services segment
were ($105) of costs related to the acquired company and ($9) of deconversion
costs. Cost of revenue non-GAAP adjustments for the remainder of the segments
were deconversion costs.
**Segment income margin is calculated by dividing segment income by revenue for
each segment. Non-GAAP adjusted segment income margin is calculated by dividing
non-GAAP adjusted segment income by non-GAAP adjusted revenue for each segment.
***Non-GAAP adjustments unassigned to a segment were deconversion costs of
$1,212, research and development costs related to the acquired company of $658,
and selling, general, and administrative costs related to the acquired company
of $20.
5
Th…
Mo…
En…
Se…
30,
20…
──────────────────────────────────────────────────────────────────────────────
(…
d… Co… Pa… Co… Co… To…
in Se…
t…
G… $ 19… $ 23… $ 19… $ 24,… $ 644…
R…
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a…
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R…
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a…
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I…
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M…
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S…
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*Revenue non-GAAP adjustments for the segments were deconversion revenue. Cost
of revenue non-GAAP adjustments for the segments were deconversion costs.
**Segment income margin is calculated by dividing segment income by revenue for
each segment. Non-GAAP adjusted segment income margin is calculated by dividing
non-GAAP adjusted segment income by non-GAAP adjusted revenue for each segment.
***Non-GAAP adjustments unassigned to a segment were a gain on assets, net, of
$3,796 less deconversion costs of $621.
6
The table below shows our GAAP to non-GAAP guidance for the fiscal year ending
June 30, 2027. Fiscal year 2027 non-GAAP guidance excludes the impacts of
deconversion revenue and related operating expenses, acquisition revenues and
related operating expenses, and the gain on assets, net, and assumes no
additional acquisitions or dispositions will be made during the fiscal year.
…
…
…
…
…
…
…
… …
… …
… A… … …
… F… L… H… … F… R… … … F…
──────────────────────────────────────────────────────────────────────────────
… $ 2… $ 2… $ … $ 2… $ —
…
… 6… % 6… %
… 30 30 … 43 —
… 1 1 — 5 …
…
… $ 2… $ 2… $ … $ 2… $ 5
…
…
… 6… % 7… %
…
…
… $ 2… $ 2… $ … $ 1… $ —
…
… 6… % 7… %
… 7 7 … 13 —
…
… 2 2 — 8 …
…
…
… — — … -7 —
…
…
…
… $ 2… $ 2… $ … $ 1… $ 8
…
…
…
… 6… % 6… %
…
…
… $ 6… $ 6… $ … $ 6… $ —
…
… 4… % 6… %
…
… 2… % 2… % … % 2… %
…
…
… $ 6… $ 6… $ … $ 6… $ …
…
…
…
… 7… % 9… %
…
…
… 2… % 2… % … % 2… %
…
…
… $ 7… $ 7… $ … $ 6… $ —
…
… 7… % 7… %
*Deconversion revenue and related operating expenses are based on actual results
for the fiscal three months ended September 30, 2026, and estimates for the
remainder of the fiscal year 2027. See the Company’s Form 8-K filed with the
Securities and Exchange Commission on October 29, 2026.
**GAAP to Non-GAAP revenue, operating expenses, and operating income may not
foot due to rounding.
7
Balance Sheet and Cash Flow Review
• Cash and cash equivalents were $25 million at September 30, 2026, compared to
$36 million at September 30, 2025.
• Trade receivables were $346 million at September 30, 2026, and $308 million at
September 30, 2025.
• The Company had $85 million of borrowings at September 30, 2026, compared to
$20 million of borrowings at September 30, 2025.
• Deferred revenue was $333 million at September 30, 2026, compared to $321
million at September 30, 2025.
• Stockholders' equity decreased to $2,100 million at September 30, 2026,
compared to $2,173 million at September 30, 2025.
* See table below for Net Cash From Operating Activities and on page 13 for
Return on Average Stockholders’ Equity. Tables reconciling the non-GAAP measures
Free Cash Flow and Net Operating Profit After Tax Return on Invested Capital
(NOPAT ROIC) to GAAP measures are on pages 13 and 14. See the Use of Non-GAAP
Financial Information section below for the definitions of Free Cash Flow and
NOPAT ROIC.
The following table summarizes net cash from operating activities:
(Unaudited, dollars in Three Months Ended
thousands) September 30, 2026 2025
──────────────────────────────────────────────────────────────────────────────
Net income $ 160,412 $ 143,986
Depreciation 11,245 10,434
Amortization 44,593 41,458
Change in deferred income taxes 11,354 38,987
Other non-cash expenses 4,578 2,510
Change in receivables 3,288 12,196
Change in deferred revenue -39,724 -42,291
Change in other assets and -34,493 -86,690
liabilities*
NET CASH FROM OPERATING $ 161,253 $ 120,590
ACTIVITIES
*For the fiscal three months ended September 30, 2026, the change in other
assets and liabilities includes the change in accrued expenses of $(34,551), the
change in prepaid expenses, deferred costs and other of $(31,640), and the
change in accounts payable of $(4,123), partially offset by the change in income
taxes of $35,821. For the fiscal three months ended September 30, 2025, the
change in other assets and liabilities includes the change in accrued expenses
of $(36,567), the change in prepaid expenses, deferred costs and other of
$(34,336), the change in income taxes of $(9,150), and the change in accounts
payable of $(6,637).
8
The following table summarizes net cash from investing activities:
(Unaudited, dollars in Three Months Ended
thousands) September 30, 2026 2025
──────────────────────────────────────────────────────────────────────────────
Payment for acquisitions $ — $ -42,390
Capital expenditures -26,960 -8,880
Proceeds from sale of assets — 7,479
Purchased software -1,577 -1,509
Computer software developed -49,784 -48,203
Purchase of investments -1,000 -6,000
Proceeds from investments 4,000 1,000
NET CASH FROM INVESTING $ -75,321 $ -98,503
ACTIVITIES
The following table summarizes net cash from financing activities:
(Unaudited, dollars in Three Months Ended
thousands) September 30, 2026 2025
──────────────────────────────────────────────────────────────────────────────
Borrowings on credit $ 188,000 $ 20,000
facilities
Repayments on credit -143,000 —
facilities
Purchase of treasury stock -70,903 -62,045
Dividends paid -42,768 -42,145
Net cash from issuance of
stock and tax -3,961 -3,611
related to stock-based
compensation
NET CASH FROM FINANCING $ -72,632 $ -87,801
ACTIVITIES
9
Use of Non-GAAP Financial Information
Generally Accepted Accounting Principles (GAAP) is the term used to refer to the
standard framework of guidelines for financial accounting in the United States.
GAAP includes the standards, conventions, and rules accountants follow in
recording and summarizing transactions in the preparation of financial
statements. In addition to reporting financial results in accordance with GAAP,
we have provided certain non-GAAP financial measures, including adjusted
revenue, adjusted segment revenue, adjusted operating income, adjusted segment
income, adjusted cost of revenue, adjusted segment cost of revenue, adjusted
operating expenses, adjusted operating margin, adjusted segment income margin,
non-GAAP earnings before interest, taxes, depreciation, and amortization (non-
GAAP EBITDA), free cash flow, free cash flow conversion, net operating profit
after tax return on invested capital (NOPAT ROIC), and non-GAAP adjusted net
income. We also present key revenue, which is the sum of cloud services revenue
and processing revenue, and non-key revenue, which is all other GAAP revenue.
Key revenue and non-key revenue are components of GAAP revenue and are presented
because management views key revenue as the strategic recurring revenue of the
business most important for long-term growth.
We believe non-GAAP financial measures help investors better understand the
underlying fundamentals and operating performance of our business. Adjusted
revenue, adjusted segment revenue, adjusted operating income, adjusted operating
margin, adjusted segment income, adjusted segment income margin, adjusted cost
of revenue, adjusted segment cost of revenue, adjusted operating expenses, and
adjusted net income eliminate deconversion revenue and associated costs, the
gain on assets, net, and an acquisition, which management believes are not
indicative of the Company's operating performance. Such adjustments give
investors further insight into our performance. Non-GAAP EBITDA is defined as
net income attributable to the Company before the effect of interest income,
net, taxes, depreciation, and amortization, adjusted for net income before the
effect of interest income, net, taxes, depreciation, and amortization
attributable to eliminated deconversions, the gain on assets, net, and an
acquisition. Free cash flow is defined as net cash from operating activities,
less capitalized expenditures, internal use software, and capitalized software,
plus proceeds from the sale of assets. NOPAT ROIC is defined as operating income
for the trailing four quarters multiplied by one minus the average effective tax
rate (ETR) for the trailing four quarters, with the result divided by average
invested capital (average of the beginning and ending period balances). Free
cash flow conversion is defined as free cash flow, less proceeds from sale of
assets, divided by net income. Management believes that non-GAAP EBITDA is an
important measure of the Company’s overall operating performance and excludes
certain costs and other transactions that management does not consider
indicative of the Company's ongoing operating performance; free cash flow is
useful to measure the funds generated in a given period that are available for
debt service requirements and strategic capital decisions; free cash flow
conversion is useful to measure the efficiency with which operating results are
converted into free cash flow; and NOPAT ROIC is a measure of the Company’s
allocation efficiency and effectiveness of its invested capital. For these
reasons, management also uses these non-GAAP financial measures in its
assessment and management of the Company's performance.
Non-GAAP financial measures used by the Company may not be comparable to
similarly titled non-GAAP measures used by other companies. Non-GAAP financial
measures have no standardized meaning prescribed by GAAP and therefore, are
unlikely to be comparable with calculations of similar measures for other
companies.
Any non-GAAP financial measures should be considered in context with the GAAP
financial presentation and should not be considered in isolation or as a
substitute for GAAP measures. Reconciliations of the non-GAAP financial measures
to related GAAP measures are included.
10
About Jack
Henry & Quarterly
Associates, Conference Call
Inc.®
Jack
Henry®(Nasdaq:
JKHY) is a
well-rounded
financial
technology
company that
strengthens
connections
between
financial
institutions
and the people
and
businesses they
serve. We are
an S&P 500
company that
prioritizes
openness,
collaboration,
and user
centricity —
offering banks
and credit
unions a
vibrant
ecosystem of The Company will
internally hold a conference
developed call on November
modern 4, 2026, at 7:45
capabilities as a.m. Central
well as Time, and
the ability to investors are
integrate with invited to listen
leading atwww.jackhenry.…
fintechs. For A webcast replay
50 years, Jack will be available
Henry has approximately one
provided hour after the
technology event
solutions to atir.jackhenry.c…
enable will remain
clients to available for one
innovate year.
faster,
strategically
differentiate,
and
successfully
compete while
serving the
evolving needs
of their
accountholders.
We empower
approximately
7,200 clients
with
people-inspired
innovation,
personal
service, and
insight-driven
solutions that
help reduce the
barriers
to financial
health.
Additional
information is
available
atwww.jackhenr…
Statements made
in this news
release
that are not
historical
facts,
including
the Company's
fiscal 2027
guidance and
statements
regarding
future
performance,
are
"forward-looki…
statements"
within
the meaning of
the Private
Securities
Litigation
Reform Act of
1995, Section
27A of the
Securities Act
of 1933 and
Section 21E of
the Securities
Exchange
Act of 1934.
Because
forward-looking
statements
relate to the
future, they
are subject to
inherent risks
and
uncertainties
that could
cause actual
results to
differ
materially from
those
expressed or MEDIA CONTACT
implied by such
statements.
Such risks and
uncertainties
include,
but are not
limited to,
those discussed
in the
Company's
Securities and
Exchange
Commission
filings,
including the
Company's most
recent reports
on Form
10-K and Form
10-Q,
particularly
under
the heading
Risk Factors.
Any
forward-looking
statement made
in this
news release
speaks only as
of the date
of the news
release, and
the Company
expressly
disclaims any
obligation to
publicly update
or revise any
forward-looking
statement,
whether
because of new
information,
future
events or
otherwise.
Jeremy Elwood
Corporate
Communications
Jack Henry &
Associates, Inc.
417-235-6652
JDElwood@jackhe…
ANALYST CONTACT
Vance Sherard,
CFA
Investor
Relations
Jack Henry &
Associates, Inc.
417-235-6652
VSherard@jackhe…
11
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14
FAQ for Analysts / Investors
(Dollars in thousands)
1.
Why does Core segment revenue growth appear to have moderated this quarter?
• The current quarter is being compared against a prior year period that
included elevated one-time revenues from on-premise implementations and
consulting engagements. Excluding those one-time items, growth in key recurring
areas of the Core segment grew 8.6%, which is a positive indicator of the
ongoing strength of the segment.
2. Why did the Company rename "Public and Private Cloud" revenue to "Cloud
Services"?
• The Company made this change beginning in the first quarter of fiscal 2027 to
simplify presentation and improve clarity. This does not represent any change to
the products or services we offer or to previously reported financial results,
and prior period amounts are presented on a consistent basis.
3. What were the first quarter of fiscal 2026 segment reclassifications?
• During the first quarter of fiscal 2027, the Company transferred a product
from the Core segment to the Complementary segment for better alignment.
Therefore, first quarter of fiscal 2026 results were recast. Revenue of $5,292
and cost of revenue of $746 were reclassified. Other reclassifications unrelated
to the product transfer noted above were $757 of cost of revenue reclassified
from Core to Corporate Services to align with current allocation of cost of
revenue by segment. These changes are segment-level only and do not affect
consolidated results.
4. What is the timing of the Connect Conference?
• The Connect Conference is Jack Henry's annual client conference. The revenue
and expenses associated with the conference are included in the Corporate
Services segment. The event was held in the first quarter of fiscal 2026 and is
in the the second quarter of fiscal 2027. The event will be held in the second
quarter for the next four years.
15