First quarter summary:
GAAP revenue increased 7.3% and GAAP operating income increased 21.7% for the fiscal three months ended September 30, 2025, compared to the prior fiscal year quarter.
Non-GAAP adjusted revenue increased 8.7% and non-GAAP adjusted operating income increased 18.6% for the fiscal three months ended September 30, 2025, compared to the prior fiscal year quarter.1
GAAP EPS was $1.97 per diluted share for the fiscal three months ended September 30, 2025, compared to $1.63 per diluted share in the prior fiscal year quarter.
Cash and cash equivalents were $36.2 million at September 30, 2025, and $43.2 million at September 30, 2024.
Debt outstanding related to credit facilities was $20 million at September 30, 2025, and $140 million at September 30, 2024.
Full year fiscal 2026 guidance (Dollars in millions):3
Current
GAAP
Low
High
Revenue
$2,491
$2,514
Operating margin4
23.9 %
24.1 %
EPS
$6.38
$6.49
Non-GAAP5
Adjusted revenue
$2,465
$2,488
Adjusted operating margin
23.5 %
23.7 %
MONETT, Mo., Nov. 4, 2025 /PRNewswire/ -- Jack Henry & Associates, Inc. (NASDAQ:JKHY), a leading financial technology provider, today announced results for fiscal first quarter ended September 30, 2025.
1 See tables below on page 4 reconciling non-GAAP financial measures to GAAP.
2See table below on page 12 reconciling net income to non-GAAP EBITDA.
3 The full fiscal year guidance assumes no additional acquisitions or dispositions will be made during fiscal year 2026.
4Operating margin is calculated by dividing operating income by revenue.
5 See tables below on page 7 reconciling fiscal year 2026 GAAP to non-GAAP guidance.
According to Greg Adelson, President and CEO,"We are pleased to report very strong first-quarter financial results, including non-GAAP revenue growth that exceeded the outlook we shared in August. We continue to see strong demand for our solutions, especially following our record-breaking client conference in early September. We completed our acquisition of Victor Technologies and are excited about the capabilities this technology brings to our clients and the many fintechs serving the financial industry. We remain confident in our ability to deliver consistent, long-term results through our unwavering commitment to culture, service, innovation, strategy, and execution."
Operating Results
Revenue, operating expenses, operating income, and net income for the fiscal three months ended September 30, 2025, compared to the fiscal three months ended September 30, 2024, were as follows:
Revenue
(Unaudited, dollars in thousands)
Three Months Ended
September 30,
% Change
2025
2024
Revenue
Services and Support
$ 376,851
$ 356,679
5.7 %
Percentage of Total Revenue
58.5 %
59.3 %
Processing
267,887
244,303
9.7 %
Percentage of Total Revenue
41.5 %
40.7 %
REVENUE
$ 644,738
$ 600,982
7.3 %
Services and support revenue increased for the fiscal three months ended September 30, 2025, primarily driven by growth in data processing and hosting revenue within cloud of 8.0%, higher user group revenue by $5,481 due to the timing of our Connect conference, and higher deconversion revenue by $4,929. Processing revenue increased for the fiscal three months ended September 30, 2025, primarily driven by growth in card revenue of 9.0%, higher transaction and digital revenue of 13.9%, and an increase in payment processing revenues primarily related to PayCenter of 12.1%.
For the fiscal three months ended September 30, 2025, core segment revenue increased 0.5%, payments segment revenue increased 9.0%, complementary segment revenue increased 10.2%, and corporate and other segment revenue increased 31.6%. For the fiscal three months ended September 30, 2025, core segment non-GAAP adjusted revenue increased 6.3%, payments segment non-GAAP adjusted revenue increased 8.3%, complementary segment non-GAAP adjusted revenue increased 9.4%, and corporate and other non-GAAP adjusted segment revenue increased 31.5%. Total non-GAAP adjusted revenue increased 8.7%. Excluding the impact of the user group revenues related to the timing of our Connect conference, non-GAAP adjusted revenue growth was 7.8% (see revenue lines of segment break-out tables on pages 5 and 6 below for a reconciliation of GAAP segment revenue to non-GAAP adjusted segment revenue).
Operating Expenses and Operating Income
(Unaudited, dollars in thousands)
Three Months Ended
September 30,
% Change
2025
2024
Cost of Revenue
$ 348,566
$ 343,432
1.5 %
Percentage of Total Revenue6
54.1 %
57.1 %
Research and Development
39,278
39,686
(1.0) %
Percentage of Total Revenue6
6.1 %
6.6 %
Selling, General, and Administrative
72,829
66,588
9.4 %
Percentage of Total Revenue6
11.3 %
11.1 %
OPERATING EXPENSES
460,673
449,706
2.4 %
OPERATING INCOME
$ 184,065
$ 151,276
21.7 %
Operating Margin6
28.5 %
25.2 %
Cost of revenue increased for the fiscal three months ended September 30, 2025, primarily due to higher direct costs generally consistent with increases in related lines of revenue, excluding cost of customer maintenance, slightly higher personnel costs, and increased amortization of intangible assets, partially offset by the decrease in cost of customer maintenance due to a contractual change (see FAQ for Analysts/Investors section on page 13), quarter over quarter.
Research and development expense slightly decreased for the fiscal three months ended September 30, 2025, compared to the fiscal three months ended September 30, 2024.
Selling, general, and administrative expense increased for the fiscal three months ended September 30, 2025, primarily due to higher expenses related to the timing of our Connect conference and increased professional services, partially offset by the higher gain on sale of assets in the current fiscal year quarter.
Net Income
(Unaudited, in thousands,
except per share data)
Three Months Ended
September 30,
% Change
2025
2024
Income Before Income Taxes
$ 190,318
$ 156,798
21.4 %
Provision for Income Taxes
46,332
37,607
23.2 %
NET INCOME
$ 143,986
$ 119,191
20.8 %
Diluted earnings per share
$ 1.97
$ 1.63
21.1 %
Effective tax rates for the fiscal three months ended September 30, 2025, and 2024, were 24.3% and 24.0%, respectively.
According to Mimi Carsley, CFO and Treasurer, "The resiliency of our business model showed in our first quarter results. Strong growth in key areas of our non-GAAP revenue, resulting in significant leverage to non-GAAP operating income and free cash flow. This cash flow was partially utilized for $100 million in share repurchases for the first quarter and the month of October."
6Operating margin is calculated by dividing operating income by revenue. Operating margin plus operating expense components as a percentage of total revenue may not equal 100% due to rounding.
Impact of Non-GAAP Adjustments
The tables below show our revenue, operating income, and net income for the fiscal three months ended September 30, 2025, compared to the fiscal three months ended September 30, 2024, excluding the impacts of deconversions and the gain on sale of asset for the current fiscal year quarter, and excluding the impact of a contract change on first quarter fiscal 2025
(Unaudited, dollars in thousands)
Three Months EndedSeptember 30,
% Change
2025
2024
GAAP Revenue*
$ 644,738
$ 600,982
7.3 %
Adjustments:
Deconversion revenue
(8,626)
(3,697)
Revenue related to a contract change
—
(12,248)
NON-GAAP ADJUSTED REVENUE*
$ 636,112
$ 585,037
8.7 %
GAAP Operating Income
$ 184,065
$ 151,276
21.7 %
Adjustments:
Operating income from deconversions
(7,101)
(3,495)
Gain on sale of assets, net
(3,796)
—
Operating income related to a contract change
—
(1,805)
NON-GAAP ADJUSTED OPERATING INCOME
$ 173,168
$ 145,976
18.6 %
Non-GAAP Adjusted Operating Margin**
27.2 %
25.0 %
GAAP Net Income
$ 143,986
$ 119,191
20.8 %
Adjustments:
Net income from deconversions
(7,101)
(3,495)
Gain on sale of assets, net
(3,796)
—
Net income related to a contract change
—
(1,805)
Tax impact of adjustments***
2,615
1,272
NON-GAAP ADJUSTED NET INCOME
$ 135,704
$ 115,163
17.8 %
*GAAP revenue is comprised of services and support and processing revenues (see page 2). Services and support revenue less deconversion revenue for the three months ended September 30, 2025, and 2024 which was $8,626 for the current fiscal year quarter and $3,697 for the prior fiscal year quarter, and reducing the three months ended September 30, 2024, for revenue related to a contract change of $12,248, results in non-GAAP adjusted services and support revenue growth of 8.1% quarter over quarter. There were no non-GAAP adjustments to processing revenue for the fiscal three months ended September 30, 2025, or 2024.
**Non-GAAP adjusted operating margin is calculated by dividing non-GAAP adjusted operating income by non-GAAP adjusted revenue.
***The tax impact of adjustments is calculated using a tax rate of 24% for the fiscal three months ended September 30, 2025, and 2024. The tax rate for non-GAAP adjustment items takes a broad look at the Company's recurring tax adjustments and applies them to non-GAAP revenue that does not have its own specific tax impacts.
The tables below show the segment break-out of revenue and cost of revenue for each period presented, as adjusted for the items above, and include a reconciliation to non-GAAP adjusted operating income presented above.
Three Months Ended September 30, 2025
(Unaudited, dollars in thousands)
Core
Payments
Complementary
Corporateand Other
Total
GAAP REVENUE
$ 195,293
$ 230,894
$ 194,217
$ 24,334
$ 644,738
Non-GAAP adjustments*
(3,219)
(3,483)
(1,876)
(48)
(8,626)
NON-GAAP ADJUSTED REVENUE
192,074
227,411
192,341
24,286
636,112
GAAP COST OF REVENUE
73,137
118,660
72,260
84,509
348,566
Non-GAAP adjustments*
(443)
(151)
(308)
(2)
(904)
NON-GAAP ADJUSTED COST OF REVENUE
72,694
118,509
71,952
84,507
347,662
