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Tyler's (TYL) Q2 Earnings and Revenues Surpass Estimates
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Tyler Technologies (TYL - Free Report) reported second-quarter 2022 non-GAAP earnings of $1.88 per share, which beat the Zacks Consensus Estimate of $1.83 per share and improved 2.9% from the year-ago quarter.
GAAP and non-GAAP revenues increased 16% year over year to $468.7 million. The top line outpaced Zacks Consensus Estimate of $456.2 million.
The robust year-over-year top-line growth was primarily driven by growth in subscription revenues. During the second quarter, software subscription arrangements comprised approximately 74% of the total new software contract value as the company continued to transform into a software-as-a-service model from its on-premise license-based model. On an organic basis, non-GAAP revenues increased 5.8%.
Tyler Technologies, Inc. Price, Consensus and EPS Surprise
Tyler’s recurring revenues from maintenance and subscriptions increased 16.7% year over year to $372.6 million and accounted for 79.5% of the total quarterly revenues.
TYL reported annualized recurring revenues on a non-GAAP basis of $1.49 billion, up 16.3% year over year. Subscription bookings in the second quarter added $27.6 million to annual recurring revenues.
Segment-wise, maintenance revenues (accounting for 24.9% of total revenues) were $116.8 million, down from $119.6 million in the year-ago quarter.
Subscription revenues (54.6% of total revenues) grew 28.2% year over year to $255.8 million.
Software licenses and royalties (3.2% of total revenues) of $15 million decreased 14.8% on a year-over-year basis.
Software Services revenues (13.5% of total revenues) amounted to $63.1 million, up 18.4% from the year-ago quarter.
Appraisal services revenues (1.9% of total revenues) rose 39.7% from the prior-year quarter to $8.8 million.
Hardware and other revenues (1.9% of total revenues) jumped 18.2% from the year-ago quarter to $9.1 million.
The backlog at the quarter-end was $1.85 billion, up 13.9% year over year. Bookings surged 21% year over year to $562 million due to its clients shifting from on-premise services to SaaS services. Excluding NIC’s contributions, bookings increased 16% year over year. In the trailing 12 months, bookings increased 53% year over year to $2 billion. Excluding NIC contributions, bookings grew 21% to $1.5 billion.
Operating Details
Tyler’s non-GAAP gross profit increased 6.6% year over year to $214.4 million. However, the non-GAAP gross margin contracted 390 basis points (bps) to 45.7%.
Adjusted EBITDA increased 3.8% year over year to $119 million.
Non-GAAP operating income for the quarter totaled $110.6 million, up 3% year over year. However, the non-GAAP operating margin contracted 290 bps to 23.6%.
Balance Sheet & Other Details
As of Jun 30, 2022, Tyler’s cash and cash equivalents were $253.1 million compared with $243.3 million on Mar 31, 2022.
The company generated $76.7 million in cash from operational activities and $60 million of free cash flow. With the rising interest rates, Tyler is focusing on utilizing its excess cash for debt reduction.
During the first six months of 2022, the company generated $130.2 million and $101 million in operating and free cash flow, respectively.
Guidance
For 2022, TYL lowered its adjusted earnings guidance range from the previously projected $7.48-$7.64 per share to the $7.36-$7.52 per share range. The company anticipates interest rate hikes, accelerated non-cash amortization of debt discounts and issuance costs associated with debt repayments.
However, Tyler continues to expect GAAP and non-GAAP revenues in the range of $1.835-$1.870 billion for the year.
Zacks Rank & Stocks to Consider
Tyler currently has a Zacks Rank of 3 (Hold). Shares of TYL have plunged 24.5% in the past year.
The Zacks Consensus Estimate for Axcelis' second-quarter 2022 earnings has been revised 6 cents northward to $1.00 per share over the past 90 days. For 2022, earnings estimates have moved a penny north to $4.38 per share in the past 30 days.
Axcelis' earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 23.5%. Shares of ACLS have soared 79.6% in the past year.
The Zacks Consensus Estimate for Keysight's third-quarter fiscal 2022 earnings has been revised upward by a penny to $1.79 per share over the past 30 days. For 2023, earnings estimates have moved 3 cents north to $7.17 per share in the past 30 days.
Keysight’s earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 8%. Shares of KEYS have fallen 2.8% in the past year.
The Zacks Consensus Estimate for Synopsys’ third-quarter fiscal 2022 earnings has been revised 35.1% northward to $2.04 per share over the past 90 days. For 2023, earnings estimates have moved 9.7% up to $8.67 per share in the past 90 days.
Synopsys’ earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 2.7%. Shares of SNPS have increased 24.6% in the past year.
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Tyler's (TYL) Q2 Earnings and Revenues Surpass Estimates
Tyler Technologies (TYL - Free Report) reported second-quarter 2022 non-GAAP earnings of $1.88 per share, which beat the Zacks Consensus Estimate of $1.83 per share and improved 2.9% from the year-ago quarter.
GAAP and non-GAAP revenues increased 16% year over year to $468.7 million. The top line outpaced Zacks Consensus Estimate of $456.2 million.
The robust year-over-year top-line growth was primarily driven by growth in subscription revenues. During the second quarter, software subscription arrangements comprised approximately 74% of the total new software contract value as the company continued to transform into a software-as-a-service model from its on-premise license-based model. On an organic basis, non-GAAP revenues increased 5.8%.
Tyler Technologies, Inc. Price, Consensus and EPS Surprise
Tyler Technologies, Inc. price-consensus-eps-surprise-chart | Tyler Technologies, Inc. Quote
Quarterly Details
Tyler’s recurring revenues from maintenance and subscriptions increased 16.7% year over year to $372.6 million and accounted for 79.5% of the total quarterly revenues.
TYL reported annualized recurring revenues on a non-GAAP basis of $1.49 billion, up 16.3% year over year. Subscription bookings in the second quarter added $27.6 million to annual recurring revenues.
Segment-wise, maintenance revenues (accounting for 24.9% of total revenues) were $116.8 million, down from $119.6 million in the year-ago quarter.
Subscription revenues (54.6% of total revenues) grew 28.2% year over year to $255.8 million.
Software licenses and royalties (3.2% of total revenues) of $15 million decreased 14.8% on a year-over-year basis.
Software Services revenues (13.5% of total revenues) amounted to $63.1 million, up 18.4% from the year-ago quarter.
Appraisal services revenues (1.9% of total revenues) rose 39.7% from the prior-year quarter to $8.8 million.
Hardware and other revenues (1.9% of total revenues) jumped 18.2% from the year-ago quarter to $9.1 million.
The backlog at the quarter-end was $1.85 billion, up 13.9% year over year.
Bookings surged 21% year over year to $562 million due to its clients shifting from on-premise services to SaaS services. Excluding NIC’s contributions, bookings increased 16% year over year. In the trailing 12 months, bookings increased 53% year over year to $2 billion. Excluding NIC contributions, bookings grew 21% to $1.5 billion.
Operating Details
Tyler’s non-GAAP gross profit increased 6.6% year over year to $214.4 million. However, the non-GAAP gross margin contracted 390 basis points (bps) to 45.7%.
Adjusted EBITDA increased 3.8% year over year to $119 million.
Non-GAAP operating income for the quarter totaled $110.6 million, up 3% year over year. However, the non-GAAP operating margin contracted 290 bps to 23.6%.
Balance Sheet & Other Details
As of Jun 30, 2022, Tyler’s cash and cash equivalents were $253.1 million compared with $243.3 million on Mar 31, 2022.
The company generated $76.7 million in cash from operational activities and $60 million of free cash flow. With the rising interest rates, Tyler is focusing on utilizing its excess cash for debt reduction.
During the first six months of 2022, the company generated $130.2 million and $101 million in operating and free cash flow, respectively.
Guidance
For 2022, TYL lowered its adjusted earnings guidance range from the previously projected $7.48-$7.64 per share to the $7.36-$7.52 per share range. The company anticipates interest rate hikes, accelerated non-cash amortization of debt discounts and issuance costs associated with debt repayments.
However, Tyler continues to expect GAAP and non-GAAP revenues in the range of $1.835-$1.870 billion for the year.
Zacks Rank & Stocks to Consider
Tyler currently has a Zacks Rank of 3 (Hold). Shares of TYL have plunged 24.5% in the past year.
Some better-ranked stocks from the broader Computer and Technology sector are Axcelis Technologies (ACLS - Free Report) , Keysight Technologies (KEYS - Free Report) and Synopsys (SNPS - Free Report) . While Axcelis flaunts a Zacks Rank #1 (Strong Buy), Keysight and Synopsys each carry a Zacks Rank of 2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Axcelis' second-quarter 2022 earnings has been revised 6 cents northward to $1.00 per share over the past 90 days. For 2022, earnings estimates have moved a penny north to $4.38 per share in the past 30 days.
Axcelis' earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 23.5%. Shares of ACLS have soared 79.6% in the past year.
The Zacks Consensus Estimate for Keysight's third-quarter fiscal 2022 earnings has been revised upward by a penny to $1.79 per share over the past 30 days. For 2023, earnings estimates have moved 3 cents north to $7.17 per share in the past 30 days.
Keysight’s earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 8%. Shares of KEYS have fallen 2.8% in the past year.
The Zacks Consensus Estimate for Synopsys’ third-quarter fiscal 2022 earnings has been revised 35.1% northward to $2.04 per share over the past 90 days. For 2023, earnings estimates have moved 9.7% up to $8.67 per share in the past 90 days.
Synopsys’ earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 2.7%. Shares of SNPS have increased 24.6% in the past year.