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Tyler Technologies, Inc. (TYL - Free Report) reported second-quarter 2024 non-GAAP earnings of $2.40 per share, which beat the Zacks Consensus Estimate of $2.34. The bottom line was higher than the year-ago quarter’s earnings of $2.01.
Non-GAAP revenues increased 7.3% year over year to $541 million. Moreover, the top line beat the Zacks Consensus Estimate of $537.3 million.
The year-over-year improvement in the top line was primarily driven by a rise in subscription revenues. During the second quarter, software subscription arrangements comprised approximately 97% 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 8.4% year over year to $449 million and accounted for 83% of the total quarterly revenues.
TYL reported annualized recurring revenues on a non-GAAP basis of $1.80 billion, up 8.4% year over year.
Segment-wise, Maintenance revenues (accounting for 21.3% of total revenues) were $115.3 million, down from $116.54 million reported in the year-ago quarter. Our model estimate for Maintenance revenues was pegged at $115.3 million.
Subscription revenues (61.7% of total revenues) grew 12.1% year over year to $333.7 million, while our model estimate for the same was pinned at $331.5 million. On an organic basis, Subscription revenues soared 11.8% year over year.
Software licenses and royalties (1% of total revenues) of $5.3 million fell year over year by 45.5%. Our model predicted Software licenses and royalties’ sales to decrease 4.1% to $9.4 million.
Professional Services revenues (13.3% of total revenues) amounted to $72 million, up 8.3% from the year-ago quarter. Our model estimate for the same was pegged at $67.8 million.
Hardware and other revenues (2.7% of total revenues) climbed 6.6% from the year-ago quarter to $14.7 million. Our model estimate for Hardware and other revenues was pegged at $13.6 million.
Operating Details
Tyler Technologies’ non-GAAP gross profit increased 6.8% year over year to $254.7 million. The non-GAAP gross margin declined 20 basis points (bps) to 47.1%.
Adjusted EBITDA increased 14.7% year over year to $144 million.
Non-GAAP operating income for the quarter totaled $132.6 million and jumped 14.4% year over year. However, the non-GAAP operating margin expanded 150 bps to 24.5%.
Balance Sheet & Other Details
As of Jun 30, 2024, TYL’s cash and cash equivalents were $250.7 million compared with $188.2 million as of Mar 31, 2024.
The company generated an operating cash flow of $64.3 million and free cash flow of $48.6 million in the second quarter of fiscal 2024.
Revised FY24 Guidance
Tyler Technologies revised its guidance for 2024. The company now expects revenues in the range of $2.12-$2.15 billion compared with the previous guidance of $2.11-$2.14 billion. TYL projects its adjusted earnings per share in the range of $9.25-$9.45 compared with the previous guidance of $9.10-$9.30.
Zacks Rank & Stocks to Consider
Tyler Technologies currently carries a Zacks Rank #3 (Hold). Shares of TYL have gained 23.4% year to date (YTD).
The Zacks Consensus Estimate for LOGI’s fiscal 2025 earnings has been revised upward by a penny to $4.29 per share in the past 30 days, suggesting year-over-year growth of 0.94%. The long-term estimated earnings growth rate for the stock is 26.2%. The stock has lost 6.7% YTD.
The Zacks Consensus Estimate for Appfolio’s 2024 earnings has been revised downward by 2 cents to $3.98 per share in the past 60 days, indicating an increase of 132.8% on a year-over-year basis. Shares of APPF have jumped 48.1% YTD.
The consensus mark for Twilio’s 2024 earnings has been revised upward by 2 cents to $3.12 per share over the past 30 days, indicating a 27.4% increase from 2023. It has a long-term earnings growth expectation of 33%. The stock has plunged 25.6% YTD.
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Tyler Technologies (TYL) Q2 Earnings & Revenues Beat Estimates
Tyler Technologies, Inc. (TYL - Free Report) reported second-quarter 2024 non-GAAP earnings of $2.40 per share, which beat the Zacks Consensus Estimate of $2.34. The bottom line was higher than the year-ago quarter’s earnings of $2.01.
Non-GAAP revenues increased 7.3% year over year to $541 million. Moreover, the top line beat the Zacks Consensus Estimate of $537.3 million.
The year-over-year improvement in the top line was primarily driven by a rise in subscription revenues. During the second quarter, software subscription arrangements comprised approximately 97% 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 8.4% year over year to $449 million and accounted for 83% of the total quarterly revenues.
TYL reported annualized recurring revenues on a non-GAAP basis of $1.80 billion, up 8.4% year over year.
Segment-wise, Maintenance revenues (accounting for 21.3% of total revenues) were $115.3 million, down from $116.54 million reported in the year-ago quarter. Our model estimate for Maintenance revenues was pegged at $115.3 million.
Subscription revenues (61.7% of total revenues) grew 12.1% year over year to $333.7 million, while our model estimate for the same was pinned at $331.5 million. On an organic basis, Subscription revenues soared 11.8% year over year.
Software licenses and royalties (1% of total revenues) of $5.3 million fell year over year by 45.5%. Our model predicted Software licenses and royalties’ sales to decrease 4.1% to $9.4 million.
Professional Services revenues (13.3% of total revenues) amounted to $72 million, up 8.3% from the year-ago quarter. Our model estimate for the same was pegged at $67.8 million.
Hardware and other revenues (2.7% of total revenues) climbed 6.6% from the year-ago quarter to $14.7 million. Our model estimate for Hardware and other revenues was pegged at $13.6 million.
Operating Details
Tyler Technologies’ non-GAAP gross profit increased 6.8% year over year to $254.7 million. The non-GAAP gross margin declined 20 basis points (bps) to 47.1%.
Adjusted EBITDA increased 14.7% year over year to $144 million.
Non-GAAP operating income for the quarter totaled $132.6 million and jumped 14.4% year over year. However, the non-GAAP operating margin expanded 150 bps to 24.5%.
Balance Sheet & Other Details
As of Jun 30, 2024, TYL’s cash and cash equivalents were $250.7 million compared with $188.2 million as of Mar 31, 2024.
The company generated an operating cash flow of $64.3 million and free cash flow of $48.6 million in the second quarter of fiscal 2024.
Revised FY24 Guidance
Tyler Technologies revised its guidance for 2024. The company now expects revenues in the range of $2.12-$2.15 billion compared with the previous guidance of $2.11-$2.14 billion. TYL projects its adjusted earnings per share in the range of $9.25-$9.45 compared with the previous guidance of $9.10-$9.30.
Zacks Rank & Stocks to Consider
Tyler Technologies currently carries a Zacks Rank #3 (Hold). Shares of TYL have gained 23.4% year to date (YTD).
Some better-ranked stocks in the broader technology sector are Logitech (LOGI - Free Report) , Appfolio (APPF - Free Report) and Twilio (TWLO - 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 LOGI’s fiscal 2025 earnings has been revised upward by a penny to $4.29 per share in the past 30 days, suggesting year-over-year growth of 0.94%. The long-term estimated earnings growth rate for the stock is 26.2%. The stock has lost 6.7% YTD.
The Zacks Consensus Estimate for Appfolio’s 2024 earnings has been revised downward by 2 cents to $3.98 per share in the past 60 days, indicating an increase of 132.8% on a year-over-year basis. Shares of APPF have jumped 48.1% YTD.
The consensus mark for Twilio’s 2024 earnings has been revised upward by 2 cents to $3.12 per share over the past 30 days, indicating a 27.4% increase from 2023. It has a long-term earnings growth expectation of 33%. The stock has plunged 25.6% YTD.