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Tyler Technologies (TYL) Q2 Earnings & Revenues Top Estimates
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Tyler Technologies, Inc. (TYL - Free Report) reported second-quarter 2021 non-GAAP earnings of $1.83 per share beating the Zacks Consensus Estimate of $1.65 per share. The bottom line improved 32.6% from $1.38 per share in the year-ago quarter.
Non-GAAP revenues of the software and technology services provider improved by 49.4% year over year to $405.4 million from $271.3 million reported a year ago. The top line surpassed Zacks Consensus Estimate of $370.9 million.
The robust year-over-year growth in top-line was primarily driven by post-acquisition contributions of NIC and constant rebound of market and sales activities at pre-COVID levels. On an organic basis, non-GAAP revenues increased 12.3%.
Recurring revenues from maintenance and subscriptions increased 57.7% year over year to $319.2 million and accounted for 79% of the total quarterly revenues.
Annualized recurring revenues on a non-GAAP basis were $1.28 billion, up 58.2% year over year. Subscription bookings during the second quarter added $15.0 million in annual recurring revenues.
Tyler Technologies, Inc. Price, Consensus and EPS Surprise
Segment-wise, maintenance revenues (accounting for 29.6% of total revenues) were $119.6 million, up 2.4% year over year.
Subscription revenues (49.3% of total revenues) climbed 133% year over year to $199.6 million.
Software licenses and royalties (4.4% of total revenues) of $17.6 million increased 3.4% on a year-over-year basis.
Software Services revenues (13.2% of total revenues) amounted to $53.3 million, up 22.1% from the year-ago quarter.
Appraisal services revenues (1.6% of total revenues) rose 33.4% from the prior-year quarter to $6.3 million.
Hardware and other revenues (1.9% of total revenues) rose 131.8% from the year-ago quarter to $7.7 million.
Backlog at quarter-end was $1.63 billion, up 5.6% year over year.
Bookings surged 50.1% year on year to $464 million, courtesy of post-acquisition activities of NIC along with the continuous rebound of market trends to pre-pandemic levels. Excluding NIC’s contribution, bookings increased 17.5% year over year. COVID-related initiatives, as well as NIC’s TourHealth, added $15.3 million to subscriptions revenues and software services revenues as well.
Operating Details
Tyler Technologies’ non-GAAP gross profit increased 39.8% year over year to $201 million. However, non-GAAP gross margin contracted 340 basis points to 49.6%.
Adjusted EBITDA increased by 42.1% year over year to $114.7 million. Non-GAAP operating income for the quarter totaled $107.4 million, up 43.9% year over year. However, non-GAAP operating margin contracted 100 basis points to 26.5%.
Tyler Technologies' president and chief executive officer, Lynn Moore stated that operating margin declined “as some costs and lower-margin revenues that declined in 2020 due to the COVID pandemic began to return, along with the impact of the continuation of NIC's lower-margin COVID-related revenues.”
Balance Sheet & Other Financial Details
As of Jun 30, 2021, Tyler Technologies’ cash and cash equivalents were $216.8 million compared with $1.25 billion on Mar 31, 2021.
The company used $20.3 million of cash for operational activities. Free cash flow was negative $33.5 million.
During the second quarter of 2021, both operated and free cash flow was negatively influenced by costs of acquisition, the timing of cash collections by NIC as well as remittances to agencies post-acquisition. In the second quarter of 2021, Tyler Technologies repurchased 32,600 shares of its common stock for approximately $13 million.
Guidance
Buoyed by better-than-expected second-quarter performance, Tyler Technologies raised revenue and earnings outlook for the full fiscal. The company now projects revenues between $1.532 billion and $1.557 billion in fiscal 2021, up from the earlier guidance range of $1.51-$1.54 billion. It also raised non-GAAP earnings guidance range to $6.70-$6.80 per share from $6.65-$6.77 projected earlier.
Zacks Rank and Other Key Picks
Tyler Technologies currently sports Zacks Rank #1 (Strong Buy).
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Tyler Technologies (TYL) Q2 Earnings & Revenues Top Estimates
Tyler Technologies, Inc. (TYL - Free Report) reported second-quarter 2021 non-GAAP earnings of $1.83 per share beating the Zacks Consensus Estimate of $1.65 per share. The bottom line improved 32.6% from $1.38 per share in the year-ago quarter.
Non-GAAP revenues of the software and technology services provider improved by 49.4% year over year to $405.4 million from $271.3 million reported a year ago. The top line surpassed Zacks Consensus Estimate of $370.9 million.
The robust year-over-year growth in top-line was primarily driven by post-acquisition contributions of NIC and constant rebound of market and sales activities at pre-COVID levels. On an organic basis, non-GAAP revenues increased 12.3%.
Recurring revenues from maintenance and subscriptions increased 57.7% year over year to $319.2 million and accounted for 79% of the total quarterly revenues.
Annualized recurring revenues on a non-GAAP basis were $1.28 billion, up 58.2% year over year. Subscription bookings during the second quarter added $15.0 million in annual recurring revenues.
Tyler Technologies, Inc. Price, Consensus and EPS Surprise
Tyler Technologies, Inc. price-consensus-eps-surprise-chart | Tyler Technologies, Inc. Quote
Quarterly Details
Segment-wise, maintenance revenues (accounting for 29.6% of total revenues) were $119.6 million, up 2.4% year over year.
Subscription revenues (49.3% of total revenues) climbed 133% year over year to $199.6 million.
Software licenses and royalties (4.4% of total revenues) of $17.6 million increased 3.4% on a year-over-year basis.
Software Services revenues (13.2% of total revenues) amounted to $53.3 million, up 22.1% from the year-ago quarter.
Appraisal services revenues (1.6% of total revenues) rose 33.4% from the prior-year quarter to $6.3 million.
Hardware and other revenues (1.9% of total revenues) rose 131.8% from the year-ago quarter to $7.7 million.
Backlog at quarter-end was $1.63 billion, up 5.6% year over year.
Bookings surged 50.1% year on year to $464 million, courtesy of post-acquisition activities of NIC along with the continuous rebound of market trends to pre-pandemic levels. Excluding NIC’s contribution, bookings increased 17.5% year over year. COVID-related initiatives, as well as NIC’s TourHealth, added $15.3 million to subscriptions revenues and software services revenues as well.
Operating Details
Tyler Technologies’ non-GAAP gross profit increased 39.8% year over year to $201 million. However, non-GAAP gross margin contracted 340 basis points to 49.6%.
Adjusted EBITDA increased by 42.1% year over year to $114.7 million.
Non-GAAP operating income for the quarter totaled $107.4 million, up 43.9% year over year. However, non-GAAP operating margin contracted 100 basis points to 26.5%.
Tyler Technologies' president and chief executive officer, Lynn Moore stated that operating margin declined “as some costs and lower-margin revenues that declined in 2020 due to the COVID pandemic began to return, along with the impact of the continuation of NIC's lower-margin COVID-related revenues.”
Balance Sheet & Other Financial Details
As of Jun 30, 2021, Tyler Technologies’ cash and cash equivalents were $216.8 million compared with $1.25 billion on Mar 31, 2021.
The company used $20.3 million of cash for operational activities. Free cash flow was negative $33.5 million.
During the second quarter of 2021, both operated and free cash flow was negatively influenced by costs of acquisition, the timing of cash collections by NIC as well as remittances to agencies post-acquisition. In the second quarter of 2021, Tyler Technologies repurchased 32,600 shares of its common stock for approximately $13 million.
Guidance
Buoyed by better-than-expected second-quarter performance, Tyler Technologies raised revenue and earnings outlook for the full fiscal. The company now projects revenues between $1.532 billion and $1.557 billion in fiscal 2021, up from the earlier guidance range of $1.51-$1.54 billion.
It also raised non-GAAP earnings guidance range to $6.70-$6.80 per share from $6.65-$6.77 projected earlier.
Zacks Rank and Other Key Picks
Tyler Technologies currently sports Zacks Rank #1 (Strong Buy).
Some other top-ranked in the broader technology sector include Digital Turbine (APPS - Free Report) , Salesforce (CRM - Free Report) , and Zoom Video Communications (ZM - Free Report) . Each of the stocks flaunts a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
The long-term earnings growth rate for Digital Turbine, Seagate Technology, and Zoom is currently pegged at 50%, 18.4%, and 16.6%, respectively.