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Tyler Technologies, Inc. (TYL - Free Report) reported first-quarter 2024 non-GAAP earnings of $2.20 per share, which beat the Zacks Consensus Estimate of $2.03. The bottom line was higher than the year-ago quarter’s earnings of $1.76.
Non-GAAP revenues increased 8.6% year over year to $512.4 million. Moreover, the top line beat the Zacks Consensus Estimate of $507.8 million.
Year-over-year top-line growth was primarily driven by a rise in subscription revenues. During the first quarter, software subscription arrangements comprised approximately 93% 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.
Tyler Technologies, Inc. Price, Consensus and EPS Surprise
Tyler Technologies’ recurring revenues from maintenance and subscriptions increased 8.8% year over year to $430.5 million and accounted for 84% of the total quarterly revenues.
TYL reported annualized recurring revenues on a non-GAAP basis of $1.72 billion, up 8.8% year over year.
Segment-wise, Maintenance revenues (accounting for 22.87% of total revenues) were $117.2 million, up from $115.1 million reported in the year-ago quarter. Our model estimate for Maintenance revenues was pegged at $116.4 million.
Subscription revenues (61% of total revenues) grew 11.7% year over year to $313.2 million, while our model estimate for the same was pinned at $309.8 million. On an organic basis, Subscription revenues soared 11.4% year over year.
Software licenses and royalties (1.7% of total revenues) of $8.7 million fell year over year by 13.8%. Our model predicted Software licenses and royalties’ sales to increase 24.7% to $12.6 million.
Professional Services revenues (12.64% of total revenues) amounted to $64.8 million, down 6.4% from the year-ago quarter. Our model estimate for the same was pegged at $61 million.
Hardware and other revenues (1.6% of total revenues) surged 60.8% from the year-ago quarter to $8.36 million. Our model estimate for Hardware and other revenues was pegged at $5.9 million.
The backlog at the quarter-end was $2.02 billion, up 9.5% year over year. Bookings increased 16.7% year over year to $503 million.
Operating Details
Tyler Technologies’ non-GAAP gross profit increased 11.7% year over year to $240.3 million. The non-GAAP gross margin expanded 130 basis points (bps) to 46.9%.
Adjusted EBITDA increased 19.6% year over year to $134.6 million.
Non-GAAP operating income for the quarter totaled $121.7 million and went up 19% year over year. However, the non-GAAP operating margin expanded 210 bps to 23.8%.
Balance Sheet & Other Details
As of Mar 31, 2024, TYL’s cash and cash equivalents were $188.2 million compared with $165.5 million as of Dec 31, 2024.
The company generated an operating cash flow of $71.8 million and free cash flow of $57.2 million in the first quarter of fiscal 2024. With its robust free cash flow, TYL is focusing on reducing debt. In the first quarter of 2024, Tyler Technologies repaid the final $50 million of its term debt.
Revised FY24 Guidance
Tyler Technologies revised its guidance for 2024. The company now expects revenues in the range of $2.110-$2.140 billion compared with the previous guidance of $2.095-$2.135 billion. TYL projects its adjusted earnings per share in the range of $9.10-$9.30 compared with the previous guidance of $8.90-$9.10.
Zacks Rank & Stocks to Consider
Currently, Tyler Technologies carries a Zacks Rank #3 (Hold). Shares of the company have returned 23.5% in the past year.
The Zacks Consensus Estimate for DELL’s 2024 earnings per share has been revised upward by 54 cents to $7.64 in the past 60 days. Shares of DELL have surged 170.7% in the past year.
The Zacks Consensus Estimate for ANET's 2024 earnings per share has been revised upward by 3 cents to $7.49 in the past 30 days. Shares of ANET have gained 26.1% in the past year.
The Zacks Consensus Estimate for CXDO’s 2024 earnings per share has been revised upward by 6 cents to 23 cents in the past 60 days. Shares of CXDO have skyrocketed 194.1% in the past year.
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Tyler Technologies (TYL) Q1 Earnings & Revenues Beat Estimates
Tyler Technologies, Inc. (TYL - Free Report) reported first-quarter 2024 non-GAAP earnings of $2.20 per share, which beat the Zacks Consensus Estimate of $2.03. The bottom line was higher than the year-ago quarter’s earnings of $1.76.
Non-GAAP revenues increased 8.6% year over year to $512.4 million. Moreover, the top line beat the Zacks Consensus Estimate of $507.8 million.
Year-over-year top-line growth was primarily driven by a rise in subscription revenues. During the first quarter, software subscription arrangements comprised approximately 93% 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.
Tyler Technologies, Inc. Price, Consensus and EPS Surprise
Tyler Technologies, Inc. price-consensus-eps-surprise-chart | Tyler Technologies, Inc. Quote
Quarterly Details
Tyler Technologies’ recurring revenues from maintenance and subscriptions increased 8.8% year over year to $430.5 million and accounted for 84% of the total quarterly revenues.
TYL reported annualized recurring revenues on a non-GAAP basis of $1.72 billion, up 8.8% year over year.
Segment-wise, Maintenance revenues (accounting for 22.87% of total revenues) were $117.2 million, up from $115.1 million reported in the year-ago quarter. Our model estimate for Maintenance revenues was pegged at $116.4 million.
Subscription revenues (61% of total revenues) grew 11.7% year over year to $313.2 million, while our model estimate for the same was pinned at $309.8 million. On an organic basis, Subscription revenues soared 11.4% year over year.
Software licenses and royalties (1.7% of total revenues) of $8.7 million fell year over year by 13.8%. Our model predicted Software licenses and royalties’ sales to increase 24.7% to $12.6 million.
Professional Services revenues (12.64% of total revenues) amounted to $64.8 million, down 6.4% from the year-ago quarter. Our model estimate for the same was pegged at $61 million.
Hardware and other revenues (1.6% of total revenues) surged 60.8% from the year-ago quarter to $8.36 million. Our model estimate for Hardware and other revenues was pegged at $5.9 million.
The backlog at the quarter-end was $2.02 billion, up 9.5% year over year. Bookings increased 16.7% year over year to $503 million.
Operating Details
Tyler Technologies’ non-GAAP gross profit increased 11.7% year over year to $240.3 million. The non-GAAP gross margin expanded 130 basis points (bps) to 46.9%.
Adjusted EBITDA increased 19.6% year over year to $134.6 million.
Non-GAAP operating income for the quarter totaled $121.7 million and went up 19% year over year. However, the non-GAAP operating margin expanded 210 bps to 23.8%.
Balance Sheet & Other Details
As of Mar 31, 2024, TYL’s cash and cash equivalents were $188.2 million compared with $165.5 million as of Dec 31, 2024.
The company generated an operating cash flow of $71.8 million and free cash flow of $57.2 million in the first quarter of fiscal 2024. With its robust free cash flow, TYL is focusing on reducing debt. In the first quarter of 2024, Tyler Technologies repaid the final $50 million of its term debt.
Revised FY24 Guidance
Tyler Technologies revised its guidance for 2024. The company now expects revenues in the range of $2.110-$2.140 billion compared with the previous guidance of $2.095-$2.135 billion. TYL projects its adjusted earnings per share in the range of $9.10-$9.30 compared with the previous guidance of $8.90-$9.10.
Zacks Rank & Stocks to Consider
Currently, Tyler Technologies carries a Zacks Rank #3 (Hold). Shares of the company have returned 23.5% in the past year.
Some better-ranked stocks from the broader technology sector are Dell Technologies (DELL - Free Report) , Arista Networks (ANET - Free Report) and Crexendo (CXDO - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for DELL’s 2024 earnings per share has been revised upward by 54 cents to $7.64 in the past 60 days. Shares of DELL have surged 170.7% in the past year.
The Zacks Consensus Estimate for ANET's 2024 earnings per share has been revised upward by 3 cents to $7.49 in the past 30 days. Shares of ANET have gained 26.1% in the past year.
The Zacks Consensus Estimate for CXDO’s 2024 earnings per share has been revised upward by 6 cents to 23 cents in the past 60 days. Shares of CXDO have skyrocketed 194.1% in the past year.