Jack Henry & Associates (JKHY) Morgan Stanley Technology, Media & Telecom Conference 2026 summary

Business overview and market positioning

• Celebrating 50 years, the company serves over 1,700 banks and credit unions, focusing on core processing, payments, and complementary services.

• Core processing covers back-office operations, payments segment includes card and enterprise payment services, and complementary products support fraud prevention, lending, and digital offerings.

• The company targets regional and super-regional institutions, intentionally avoiding the largest tier one banks.

• Average contract length is about seven years, with around 200 banks or credit unions in play annually, and a consistent win rate of 50-55 core deals per year.

• Pipeline has shifted toward larger accounts, with average institution size growing from $700 million to $1.5 billion.

Industry trends and competitive dynamics

• Industry consolidation is ongoing, with a major competitor sunsetting platforms, creating a multi-year opportunity to win incremental business.

• Of 1,400-1,500 banks affected by competitor consolidation, many are expected to enter RFP processes over the next three to five years.

• Implementation cycles are lengthy due to client readiness, not technical limitations, with revenue from new wins expected to start in FY 2028.

• Complementary product attach rates are high, with new core customers typically purchasing 30-50 additional services, often on coterminous contracts.

• Demand drivers include deposit gathering, lending, efficiency, and fraud prevention, with lending expected to accelerate if interest rates fall.

Technology and AI strategy

• AI is viewed as an opportunity for efficiency and innovation, not a disruptor, with over 100 approved AI tools in use internally.

• AI has enabled headcount growth to remain below 1% over five years and increased developer productivity by up to 70%.

• AI use cases include streamlining client training, rewriting procedures, and enhancing operational efficiency for banks.

• Mission-critical, highly regulated systems are seen as resistant to displacement by generic AI solutions due to operational and regulatory requirements.

• AI and cloud-based innovation are expected to drive faster product updates and improved customer personalization.