Fourth quarter and full year fiscal 2026
Filed Aug 18, 2026Jack Henry & Associates, Inc. Reports Fourth Quarter and Full Year Fiscal 2026 Results
Fiscal 2026 revenue, operating income, net income, EPS, EBITDA and free cash flow increased, and fiscal 2027 guidance calls for revenue growth and adjusted operating-margin expansion. Fourth-quarter GAAP and non-GAAP operating income, net income, EPS and margins declined as expenses grew faster than revenue.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Fourth-quarter revenueGAAP | $644,023 thousand | – | 4.7% |
| Fourth-quarter adjusted revenuenon-GAAP | $633,098 thousand | – | 6.6% |
| Fourth-quarter cost of revenueGAAP | $370,175 thousand | – | 7.6% |
| Fourth-quarter research and development expenseGAAP | $49,830 thousand | – | 17.0% |
| Fourth-quarter selling, general, and administrative expenseGAAP | $87,245 thousand | – | 19.2% |
| Fourth-quarter operating expensesGAAP | $507,250 thousand | – | 10.3% |
| Fourth-quarter operating incomeGAAP | $136,773 thousand | – | (12.2)% |
| Fourth-quarter adjusted operating incomenon-GAAP | $133,298 thousand | – | (3.1)% |
| Fourth-quarter operating marginGAAP | 21.2% | – | – |
| Fourth-quarter adjusted operating marginnon-GAAP | 21.1% | – | – |
| Fourth-quarter net incomeGAAP | $111,228 thousand | – | (12.8)% |
| Fourth-quarter adjusted net incomenon-GAAP | $108,587 thousand | – | (4.6)% |
| Fourth-quarter diluted earnings per shareGAAP | $1.57 per diluted share | – | (10.2)% |
| Fourth-quarter non-GAAP EBITDAnon-GAAP | $187,360 thousand | – | (0.9)% |
| Fiscal 2026 revenueGAAP | $2,544,339 thousand | – | 7.1% |
| Fiscal 2026 adjusted revenuenon-GAAP | $2,496,316 thousand | – | 7.3% |
| Fiscal 2026 operating expensesGAAP | $1,909,306 thousand | – | 5.7% |
| Fiscal 2026 operating incomeGAAP | $635,033 thousand | – | 11.7% |
| Fiscal 2026 adjusted operating incomenon-GAAP | $601,210 thousand | – | 11.6% |
| Fiscal 2026 operating marginGAAP | 25.0% | – | – |
| Fiscal 2026 adjusted operating marginnon-GAAP | 24.1% | – | – |
| Fiscal 2026 net incomeGAAP | $502,776 thousand | – | 10.3% |
| Fiscal 2026 adjusted net incomenon-GAAP | $477,071 thousand | – | 10.2% |
| Fiscal 2026 diluted earnings per shareGAAP | $6.98 per diluted share | – | 11.9% |
| Fiscal 2026 non-GAAP EBITDAnon-GAAP | $813,029 thousand | – | 9.4% |
| Fiscal 2026 net cash from operating activitiesGAAP | $761,960 thousand | – | – |
| Fiscal 2026 free cash flownon-GAAP | $539,333 thousand | – | – |
| Fiscal 2026 operating cash conversionnon-GAAP | 151.6% | – | – |
| Fiscal 2026 free cash flow conversion excluding proceeds from sale of assetsnon-GAAP | 100.7% | – | – |
| Return on average stockholders' equityother | 24.0% | – | – |
| NOPAT ROICnon-GAAP | 23.2% | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| CoreFourth-quarter GAAP segment revenue increased 1.9% compared to the prior fiscal year quarter. | $191,611 thousand | – | 1.9% |
| PaymentsFourth-quarter GAAP segment revenue increased 4.9% compared to the prior fiscal year quarter. Processing growth was driven by card revenue, Jack Henry digital and transaction revenue, and faster payments revenue. | $240,419 thousand | – | 4.9% |
| ComplementaryFourth-quarter GAAP segment revenue increased 4.7% compared to the prior fiscal year quarter. | $188,800 thousand | – | 4.7% |
| Corporate ServicesFourth-quarter GAAP segment revenue increased 30.4% compared to the prior fiscal year quarter. | $23,193 thousand | – | 30.4% |
Full fiscal year 2027 ending June 30, 2027 outlook
- RevenueGAAP revenue of $2,684 million to $2,709 million; non-GAAP adjusted revenue of $2,659 million to $2,684 million
- Operating expensesGAAP operating expenses of $2,025 million to $2,039 million; non-GAAP adjusted operating expenses of $2,018 million to $2,031 million
- NoteGAAP operating margin of 24.5% to 24.7%
- NoteNon-GAAP adjusted operating margin of 24.1% to 24.3%
- NoteGAAP operating income of $658 million to $670 million
- NoteNon-GAAP adjusted operating income of $641 million to $653 million
- NoteGAAP EPS of $7.33 to $7.38
- NoteGAAP revenue growth of 5.5% to 6.5%
- NoteNon-GAAP adjusted revenue growth of 6.3% to 7.3%
- NoteGAAP operating-expense growth of 6.1% to 6.8%
- NoteNon-GAAP adjusted operating-expense growth of 6.0% to 6.7%
- NoteGAAP operating-income growth of 3.7% to 5.5%
- NoteNon-GAAP adjusted operating-income growth of 7.2% to 9.1%
- NoteGAAP EPS growth of 5.0% to 5.7%
- NoteGuidance assumes no acquisitions or dispositions will be made during fiscal year 2027.
Capital returns
- Stock repurchases for the fiscal three months ended June 30, 2026, were $164 million at an average price of $140 per share.
- Stock repurchases for the fiscal year ended June 30, 2026, were $448 million at an average price of $152 per share.
- Purchase of treasury stock was $448,173 thousand for the fiscal year ended June 30, 2026, compared to $35,051 thousand for the fiscal year ended June 30, 2025.
- Dividends paid were $170,405 thousand for the fiscal year ended June 30, 2026, compared to $164,644 thousand for the fiscal year ended June 30, 2025.
What drove it
- Fourth-quarter services and support revenue increased 2.5%, primarily driven by 7.4% growth in data processing and hosting revenue within private and public cloud revenue, 27.3% higher license and hardware revenue, and 38.6% higher education, royalty, and other revenues.
- Fourth-quarter services and support growth was partially offset by a decrease in deconversion revenue of $11,168.
- Fourth-quarter processing revenue increased 7.5%, driven by 5.4% card-revenue growth from monthly service and risk management fees, 8.6% growth in Jack Henry digital and transaction revenue from a higher number of active users, and 47.0% growth in faster payments revenue.
- Fiscal 2026 services and support revenue increased 6.3%, with 8.5% growth in data processing and hosting revenue within private and public cloud revenue, 13.0% growth in consulting, work orders and release fees revenue, 14.1% growth in implementation revenue, and 19.5% growth in license and hardware revenue.
- Fiscal 2026 processing revenue increased 8.2%, supported by 6.0% card-revenue growth, 11.6% Jack Henry digital and transaction revenue growth, and 49.5% faster-payments revenue growth.
- The company reported a record 58 competitive core wins for fiscal 2026, including 14 institutions with more than $1 billion in assets.
Concerns
- Fourth-quarter GAAP operating income declined 12.2% and adjusted operating income declined 3.1%.
- Fourth-quarter GAAP operating margin was 21.2%, compared to 25.3%, while adjusted operating margin was 21.1%, compared to 23.2%.
- Fourth-quarter operating expenses increased 10.3%, exceeding 4.7% GAAP revenue growth. Research and development expense increased 17.0% and selling, general, and administrative expense increased 19.2%.
- The company cited higher personnel costs, including compensation and benefit costs, higher direct costs, higher amortization of capitalized software, increased internal licenses and fees, and higher medical costs from second-half normalization trends.
- Cash and cash equivalents declined to $12.1 million and debt outstanding for credit facilities increased to $40 million at June 30, 2026.
- Fiscal 2026 software usage revenue decreased 26.2%, mainly due to a contract change in the prior fiscal year.
What to watch
- Execution against fiscal 2027 GAAP revenue guidance of $2,684 million to $2,709 million and adjusted revenue guidance of $2,659 million to $2,684 million.
- Whether fiscal 2027 GAAP operating margin of 24.5% to 24.7% and adjusted operating margin of 24.1% to 24.3% are achieved, following the fourth-quarter margin decline.
- Management stated that margin comparisons will be impacted by tough comparisons from the first half of last year.
- The ongoing contribution from Victor, which will be fully integrated into non-GAAP adjusted organic revenue starting October 1, 2026.
- Trends in competitive core wins, technology spending, the sales pipeline, digital-platform active users, card revenue and faster-payments revenue.
- Capital deployment given $448 million of fiscal 2026 share repurchases, $170,405 thousand of dividends paid, $40 million of borrowings, and $12.1 million of cash and cash equivalents.
Balance sheet and cash flow
- Cash and cash equivalents were $12.1 million at June 30, 2026, compared to $102.0 million at June 30, 2025.
- Trade receivables were $349 million at June 30, 2026, compared to $318 million at June 30, 2025.
- Debt outstanding for credit facilities was $40 million at June 30, 2026, compared to $0 at June 30, 2025.
- Deferred revenue was $372 million at June 30, 2026, compared to $363 million at June 30, 2025.
- Stockholders' equity was $2,052 million at June 30, 2026, compared to $2,131 million at June 30, 2025.
- Fiscal 2026 net cash from operating activities was $761,960 thousand, compared to $641,504 thousand in fiscal 2025.
- Fiscal 2026 net cash from investing activities was $(277,738) thousand, compared to $(232,163) thousand in fiscal 2025.
- Fiscal 2026 net cash from financing activities was $(574,119) thousand, compared to $(345,672) thousand in fiscal 2025.
- Fiscal 2026 capital expenditures were $(67,103) thousand, computer software developed was $(184,243) thousand, and payment for acquisitions was $(42,390) thousand.
Analysis
Jack Henry closed fiscal 2026 with fourth-quarter GAAP revenue of $644,023 thousand, up 4.7%, and non-GAAP adjusted revenue of $633,098 thousand, up 6.6%. Processing revenue rose 7.5%, ahead of 2.5% growth in services and support. Processing was supported by card revenue, digital and transaction revenue associated with a higher number of active users, and faster payments revenue. Fourth-quarter services and support revenue was partly constrained by an $11,168 decrease in deconversion revenue.
The fourth-quarter earnings profile was weaker than revenue growth. GAAP operating expenses increased 10.3% to $507,250 thousand, including 17.0% research and development growth and 19.2% selling, general, and administrative growth. GAAP operating income declined 12.2% to $136,773 thousand, GAAP operating margin declined to 21.2% from 25.3%, and GAAP diluted EPS fell to $1.57 from $1.75. Adjusted operating income fell 3.1% and adjusted operating margin was 21.1%, compared to 23.2%, reflecting higher personnel, direct, amortization, internal-license, and medical costs.
The full-year result remained constructive. Fiscal 2026 GAAP revenue increased 7.1% to $2,544,339 thousand and adjusted revenue increased 7.3% to $2,496,316 thousand. GAAP operating income increased 11.7% to $635,033 thousand and GAAP operating margin improved to 25.0% from 23.9%; adjusted operating income rose 11.6% and adjusted operating margin improved to 24.1% from 23.2%. GAAP net income increased 10.3% to $502,776 thousand, GAAP EPS increased 11.9% to $6.98, and non-GAAP EBITDA increased 9.4% to $813,029 thousand.
Cash generation was substantial for the year. Net cash from operating activities was $761,960 thousand and free cash flow was $539,333 thousand, while operating cash conversion was 151.6% and free cash flow conversion excluding proceeds from sale of assets was 100.7%. The company deployed $448 million to repurchases at an average price of $152 per share and paid $170,405 thousand in dividends. Cash and cash equivalents fell to $12.1 million, debt increased to $40 million, and stockholders' equity decreased to $2,052 million.
Fiscal 2027 guidance calls for GAAP revenue of $2,684 million to $2,709 million, or 5.5% to 6.5% growth, and adjusted revenue of $2,659 million to $2,684 million, or 6.3% to 7.3% growth. The company guides GAAP operating margin to 24.5% to 24.7% and adjusted operating margin to 24.1% to 24.3%, with GAAP EPS of $7.33 to $7.38. Management expects adjusted revenue growth to remain consistent but flagged difficult first-half margin comparisons. The guide assumes no acquisitions or dispositions during fiscal 2027.
Management, verbatim
We are extremely pleased to report record sales and financial results for fiscal 2026. We delivered a record 58 competitive core wins for the year, including 14 institutions with more than $1 billion in assets, and both fourth-quarter and full-year non-GAAP revenue reached new highs. Technology spending remains strong, which is reflected in our robust sales pipeline as we continue to provide innovative solutions and expand the use of artificial intelligence to help banks and credit unions win in the markets they serve. As we enter fiscal 2027, we are well positioned to continue driving consistent revenue growth, margin expansion, and long-term value through our unwavering focus on culture, service, innovation, strategy, and execution.
Greg Adelson, President and CEO
Our full year performance delivered record revenues, substantial margin expansion, and robust free cash flow, yielding value—culminating in an outstanding ROIC of 23.2% that reflects the underlying strength of our business model. Looking ahead to full-year 2027, our non-GAAP revenue growth should remain consistent, but margin comparisons will be impacted by tough comparisons from the first half of last year. Overall, we expect another strong performance in fiscal 2027.
Mimi Carsley, CFO and Treasurer
Not in the filing
stated, not guessed- Previous-quarter outlook was not provided, so comparison of reported results with prior guidance is unavailable.
- Gross margin was not reported.
- Non-GAAP adjusted EPS for the fourth quarter and fiscal year was not reported.
- Non-GAAP adjusted EPS guidance was not reported.
- Fiscal 2027 tax-rate guidance was not reported.
- Quarterly operating cash flow and quarterly free cash flow were not reported.
- Dividend per share was not reported.
- Sequential quarter-over-quarter metric comparisons were not reported.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.