second quarter 2026
Filed Jul 29, 2026Tyler Technologies Reports Earnings for Second Quarter 2026 and Announces New $1.5 Billion Share Repurchase Program
Revenue, recurring revenue, ARR, SaaS revenue, operating cash flow, and free cash flow all increased, with SaaS bookings and total bookings reaching records. Non-GAAP operating income, non-GAAP net income per diluted share, and adjusted EBITDA grew more slowly than revenue, while the company deployed substantial capital toward an acquisition and share repurchases.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenuesGAAP | $645.1 million | – | up 8.2% |
| Recurring revenuesGAAP | $559.5 million | – | up 8.2% |
| Recurring revenues as a percentage of total revenuesGAAP | 86.7% | – | – |
| Subscription revenuesGAAP | $453.7 million | – | up 12.0% |
| Annualized recurring revenue (ARR)other | $2.24 billion | – | up 8.2% |
| GAAP operating incomeGAAP | $95.1 million | – | – |
| Non-GAAP operating incomenon-GAAP | $165.7 million | – | up 4.8% |
| GAAP net incomeGAAP | $93.5 million | – | up 10.5% |
| GAAP diluted earnings per shareGAAP | $2.23 per diluted share | – | up 10.5% |
| Non-GAAP net incomenon-GAAP | $129.0 million | – | up 0.9% |
| Non-GAAP diluted earnings per sharenon-GAAP | $3.08 per diluted share | – | up 0.9% |
| Adjusted EBITDAnon-GAAP | $176.4 million | – | up 4.3% |
| Cash flows from operationsGAAP | $124.4 million | – | up 26.5% |
| Free cash flownon-GAAP | $118.5 million | – | up 34.7% |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| SaaS revenuesPublic sector demand remained healthy, reflecting sustained modernization priorities for the public sector. | $230.6 million | – | grew 21.7% |
| Transaction revenuesNo specific driver was quantified in the filing. | $223.1 million | – | grew 3.5% |
full year 2026 outlook
- Revenue$2.535 billion to $2.575 billion
- NoteNon-GAAP diluted earnings per share: $12.95 to $13.20
- NoteFree cash flow margin: 26% to 28%
- NoteResearch and development expense: $245 million to $250 million
- NoteCapital expenditures: $18 million to $20 million
- NoteCapitalized software development costs included in capex: $6 million
- NoteNet interest income: $19 million to $21 million
Capital returns
- On July 24, 2026, Tyler’s Board of Directors approved a share repurchase plan with authorization to purchase up to $1.5 billion of Class A Common Stock.
- As of July 29, 2026, remaining Board authorization to repurchase common stock was approximately $1.745 billion.
- Tyler repurchased 1,622,762 shares of common stock during the quarter for approximately $505 million under its previously announced repurchase authorization.
- The company stated that it had repurchased 5.6% of its outstanding shares year-to-date.
What drove it
- SaaS revenues grew 21.7% to $230.6 million.
- SaaS bookings reached a new quarterly high.
- The company reported record SaaS and total bookings.
- Recurring revenues were $559.5 million and comprised 86.7% of total revenues.
- For The Record adds legal-grade speech-to-text and real-time, multilingual transcription technology powered by AI to the justice portfolio.
Concerns
- Transaction revenue growth was 3.5%, compared with SaaS revenue growth of 21.7%.
- Non-GAAP operating income grew 4.8%, non-GAAP net income per diluted share grew 0.9%, and adjusted EBITDA grew 4.3%, compared with total revenue growth of 8.2%.
- The company used approximately $505 million for share repurchases and approximately $212.7 million in cash for the For The Record acquisition during the quarter.
- Forward-looking non-GAAP financial measures were not reconciled to their most directly comparable GAAP measures because the company stated that doing so would require unreasonable efforts.
What to watch
- Execution against full-year 2026 total revenue guidance of $2.535 billion to $2.575 billion.
- Execution against full-year 2026 non-GAAP diluted earnings per share guidance of $12.95 to $13.20.
- Free cash flow margin relative to full-year guidance of 26% to 28%.
- The pace of SaaS revenue growth and booking activity following a quarter in which SaaS bookings and total bookings were records.
- Capital deployment under the new authorization to repurchase up to $1.5 billion of Class A Common Stock.
- Integration of For The Record into Tyler’s justice portfolio.
Balance sheet and cash flow
- Cash flows from operations were $124.4 million, up 26.5%.
- Free cash flow was $118.5 million, up 34.7%.
- The company completed the acquisition of For The Record on April 14 for approximately $212.7 million in cash.
- The company completed a $1.4 billion offering of 0.50% convertible senior notes due in 2031 on May 14.
- Net proceeds from the convertible notes offering, after capped call and other transaction fees, were $1.2 billion.
- The capped call transactions increased the initial effective conversion price to $655.77.
- The company entered into a new 5-year $1.0 billion unsecured revolving credit facility on May 28, replacing its previous $700 million facility.
- The company ended the quarter with more than $1 billion in cash and investments.
Analysis
Tyler reported second-quarter total revenues of $645.1 million, up 8.2%, led by subscription revenues of $453.7 million, up 12.0%. Recurring revenues were $559.5 million, up 8.2%, and represented 86.7% of total revenues. ARR was $2.24 billion, up 8.2%. Management characterized public-sector demand as healthy and said sustained modernization priorities supported record SaaS and total bookings.
SaaS was the principal reported growth engine. SaaS revenues grew 21.7% to $230.6 million, marking what management described as 22 consecutive quarters of 20% or greater SaaS growth. Transaction revenues were $223.1 million and grew 3.5%. The contrast between SaaS and transaction growth makes the subscription mix and the durability of bookings important elements of the reported demand picture.
Profit and cash flow results were positive, though reported non-GAAP earnings growth trailed revenue growth. GAAP operating income was $95.1 million and non-GAAP operating income was $165.7 million, up 4.8%. GAAP net income was $93.5 million, or $2.23 per diluted share, up 10.5%, while non-GAAP net income was $129.0 million, or $3.08 per diluted share, up 0.9%. Adjusted EBITDA was $176.4 million, up 4.3%. Cash flows from operations increased 26.5% to $124.4 million, and free cash flow increased 34.7% to $118.5 million, which management called a record for a second quarter.
Capital allocation was substantial during the quarter. Tyler completed the For The Record acquisition for approximately $212.7 million in cash and repurchased 1,622,762 shares for approximately $505 million. It also completed a $1.4 billion offering of 0.50% convertible senior notes due in 2031, with $1.2 billion of net proceeds after capped call and other transaction fees, and ended the quarter with more than $1 billion in cash and investments. The Board approved a new plan to repurchase up to $1.5 billion of Class A Common Stock, while remaining authorization was approximately $1.745 billion as of July 29, 2026.
For full-year 2026, Tyler guided total revenues to $2.535 billion to $2.575 billion, non-GAAP diluted earnings per share to $12.95 to $13.20, and free cash flow margin to 26% to 28%. The outlook also includes research and development expense of $245 million to $250 million, capital expenditures of $18 million to $20 million, capitalized software development costs included in capex of $6 million, and net interest income of $19 million to $21 million. The filing did not provide prior guidance for comparison.
Management, verbatim
Our second quarter results reflect strong execution and performance across our key financial and operational measures, highlighted by solid recurring revenue growth and a record second quarter for free cash flow.
Lynn Moore, executive chair, president and chief executive officer
During the quarter, we strategically deployed significant capital through the acquisition of For the Record for $213 million in cash and the use of $505 million for share repurchases.
Brian Miller, executive vice president and chief financial officer
Not in the filing
stated, not guessed- Previous-release outlook and prior-guidance comparison
- GAAP gross profit and GAAP gross margin
- Non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating margin, and adjusted EBITDA margin
- GAAP diluted earnings per share prior-year value
- Non-GAAP diluted earnings per share prior-year value
- Prior-year and prior-quarter values for reported revenue, recurring revenue, subscription revenue, SaaS revenue, transaction revenue, ARR, operating income, net income, EBITDA, operating cash flow, and free cash flow
- Detailed reportable operating segments beyond reported revenue categories
- Total debt balance and net debt
- Cash and investments balance stated as an exact amount
- Dividend information
- GAAP reconciliation tables and detailed income statement, balance sheet, and cash flow statement figures, which were not included in the provided filing text
- Forward guidance for gross margin, operating expenses, and tax rate
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.