We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
TYL beat Q2 earnings estimates as revenues rose 8.2% year over year and ARR reached $2.24 billion.
Tyler Technologies posted record SaaS bookings and extended SaaS revenue growth above 20% to 22 quarters.
TYL reaffirmed 2026 guidance after record free cash flow and continued cloud migration momentum.
Tyler Technologies (TYL - Free Report) reported second-quarter 2026 non-GAAP earnings of $3.08 per share, which increased 0.9% year over year and surpassed the Zacks Consensus Estimate of $3.06.
Quarterly revenues increased 8.2% year over year to $645.1 million, missing the consensus estimate by 0.29%. The quarter was highlighted by accelerating SaaS adoption, record bookings, robust recurring revenue growth and record second-quarter free cash flow. Annualized recurring revenue (ARR) reached $2.24 billion, up 8.2% year over year.
TYL's Recurring Revenue Base Remains Strong
Recurring revenues increased 8.2% year over year to $559.5 million, representing 86.7% of total revenues. Subscription revenues grew 12% to $453.7 million, reflecting continued customer migration toward Tyler Technologies' cloud-based offerings.
Management noted that recurring revenue growth continues to benefit from strong public-sector demand, healthy cloud migrations and increasing adoption of mission-critical software solutions. The company also raised its long-term recurring revenues, operating margin and free cash flow targets during its June Investor Day, underscoring confidence in its Tyler 2030 strategy.
Tyler Technologies, Inc. Price, Consensus and EPS Surprise
TYL's SaaS Momentum Continues With Record Bookings
SaaS revenues grew 21.7% year over year to $230.6 million, marking 22 consecutive quarters of at least 20% SaaS revenue growth. Transaction revenues increased 3.5% to $223.1 million.
Management highlighted record SaaS bookings and total bookings during the quarter, driven by healthy public-sector demand and continued cloud modernization initiatives. Governments remain focused on cybersecurity, digital transformation, operational efficiency and AI adoption, supporting a strong sales pipeline.
During the quarter, Tyler Technologies secured several notable wins, including another statewide Electronic Vehicle Registration, Title and Lien implementation expected to generate more than $10 million annually when fully adopted. The company also expanded AI deployments through agreements with customers such as Washtenaw County, the City of Doral and the State of Indiana.
TYL Delivers Healthy Profitability Despite Continued Investments
GAAP operating income was $95.1 million, while non-GAAP operating income increased 4.8% year over year to $165.7 million. GAAP earnings were $2.23 per share, while non-GAAP earnings came in at $3.08 per share. Adjusted EBITDA increased 4.3% to $176.4 million.
Management attributed the profitability improvement to disciplined execution, an increasingly recurring revenue mix and continued operational efficiencies while maintaining investments in long-term growth initiatives.
Tyler Technologies Generates Record Free Cash Flow
Cash flow from operations increased 26.5% year over year to $124.4 million, while free cash flow jumped 34.7% to a record second-quarter level of $118.5 million.
The company also strengthened its financial position during the quarter by completing the $212.7 million acquisition of For The Record, issuing $1.4 billion of convertible senior notes and repurchasing 1.62 million shares for approximately $505 million. Tyler ended the quarter with more than $1 billion in cash and investments and announced a new $1.5 billion share repurchase authorization.
TYL Reaffirms 2026 Outlook
For full-year 2026, Tyler Technologies expects total revenues between $2.535 billion and $2.575 billion, non-GAAP earnings per share between $12.95 and $13.20, free cash flow margin of 26-28%, R&D expense of $245-$250 million and Capital expenditures of $18-$20 million.
Zacks Rank & Other Stocks to Consider
Tyler Technologies currently carries a Zacks Rank #2 (Buy).
Shares of Analog Devices have rallied 37.1% year to date. The Zacks Consensus Estimate for ADI’s fiscal 2026 earnings is pegged at $12.42 per share, up by 10 cents over the past 30 days, indicating an increase of 59.4% year over year.
Shares of Applied Materials have skyrocketed 101.1% year to date. The Zacks Consensus Estimate for AMAT’s fiscal 2026 earnings is pegged at $12.14 per share, up by 4 cents over the past 30 days, indicating a rise of 28.9% year over year.
Cisco Systems shares have surged 48.7% year to date. The Zacks Consensus Estimate for CSCO’s fiscal 2026 earnings is pegged at $4.28 per share, unchanged over the past 30 days, indicating an increase of 12.3% year over year.
View the Zacks #1 Rank List
Image: Bigstock
Tyler Technologies Q2 Earnings Beat Estimates, Revenues Rise Y/Y
Key Takeaways
Tyler Technologies (TYL - Free Report) reported second-quarter 2026 non-GAAP earnings of $3.08 per share, which increased 0.9% year over year and surpassed the Zacks Consensus Estimate of $3.06.
Quarterly revenues increased 8.2% year over year to $645.1 million, missing the consensus estimate by 0.29%. The quarter was highlighted by accelerating SaaS adoption, record bookings, robust recurring revenue growth and record second-quarter free cash flow. Annualized recurring revenue (ARR) reached $2.24 billion, up 8.2% year over year.
TYL's Recurring Revenue Base Remains Strong
Recurring revenues increased 8.2% year over year to $559.5 million, representing 86.7% of total revenues. Subscription revenues grew 12% to $453.7 million, reflecting continued customer migration toward Tyler Technologies' cloud-based offerings.
Management noted that recurring revenue growth continues to benefit from strong public-sector demand, healthy cloud migrations and increasing adoption of mission-critical software solutions. The company also raised its long-term recurring revenues, operating margin and free cash flow targets during its June Investor Day, underscoring confidence in its Tyler 2030 strategy.
Tyler Technologies, Inc. Price, Consensus and EPS Surprise
Tyler Technologies, Inc. price-consensus-eps-surprise-chart | Tyler Technologies, Inc. Quote
TYL's SaaS Momentum Continues With Record Bookings
SaaS revenues grew 21.7% year over year to $230.6 million, marking 22 consecutive quarters of at least 20% SaaS revenue growth. Transaction revenues increased 3.5% to $223.1 million.
Management highlighted record SaaS bookings and total bookings during the quarter, driven by healthy public-sector demand and continued cloud modernization initiatives. Governments remain focused on cybersecurity, digital transformation, operational efficiency and AI adoption, supporting a strong sales pipeline.
During the quarter, Tyler Technologies secured several notable wins, including another statewide Electronic Vehicle Registration, Title and Lien implementation expected to generate more than $10 million annually when fully adopted. The company also expanded AI deployments through agreements with customers such as Washtenaw County, the City of Doral and the State of Indiana.
TYL Delivers Healthy Profitability Despite Continued Investments
GAAP operating income was $95.1 million, while non-GAAP operating income increased 4.8% year over year to $165.7 million. GAAP earnings were $2.23 per share, while non-GAAP earnings came in at $3.08 per share. Adjusted EBITDA increased 4.3% to $176.4 million.
Management attributed the profitability improvement to disciplined execution, an increasingly recurring revenue mix and continued operational efficiencies while maintaining investments in long-term growth initiatives.
Tyler Technologies Generates Record Free Cash Flow
Cash flow from operations increased 26.5% year over year to $124.4 million, while free cash flow jumped 34.7% to a record second-quarter level of $118.5 million.
The company also strengthened its financial position during the quarter by completing the $212.7 million acquisition of For The Record, issuing $1.4 billion of convertible senior notes and repurchasing 1.62 million shares for approximately $505 million. Tyler ended the quarter with more than $1 billion in cash and investments and announced a new $1.5 billion share repurchase authorization.
TYL Reaffirms 2026 Outlook
For full-year 2026, Tyler Technologies expects total revenues between $2.535 billion and $2.575 billion, non-GAAP earnings per share between $12.95 and $13.20, free cash flow margin of 26-28%, R&D expense of $245-$250 million and Capital expenditures of $18-$20 million.
Zacks Rank & Other Stocks to Consider
Tyler Technologies currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader Zacks Computer and Technology sector are Analog Devices (ADI - Free Report) , Applied Materials (AMAT - Free Report) and Cisco Systems (CSCO - Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Analog Devices have rallied 37.1% year to date. The Zacks Consensus Estimate for ADI’s fiscal 2026 earnings is pegged at $12.42 per share, up by 10 cents over the past 30 days, indicating an increase of 59.4% year over year.
Shares of Applied Materials have skyrocketed 101.1% year to date. The Zacks Consensus Estimate for AMAT’s fiscal 2026 earnings is pegged at $12.14 per share, up by 4 cents over the past 30 days, indicating a rise of 28.9% year over year.
Cisco Systems shares have surged 48.7% year to date. The Zacks Consensus Estimate for CSCO’s fiscal 2026 earnings is pegged at $4.28 per share, unchanged over the past 30 days, indicating an increase of 12.3% year over year.