Tyler Technologies (TYL) Q4 2025 earnings summary

Executive summary

• Q4 2025 delivered strong results with total revenues of $575.2 million, up 6.3% year-over-year, and recurring revenues up 10.9%, comprising up to 89.4% of total revenues.

• SaaS revenues grew 20.2% in Q4, with annual SaaS revenues up 20.6% and annualized recurring revenue reaching $2.1 billion.

• Free cash flow for Q4 was $236.9 million, with a margin of 41.2%; annual free cash flow reached $620.8 million, margin 26.6%.

• Active sales pipeline, elevated RFP activity, and major SaaS/public sector wins reflect robust demand for modernization.

• Significant progress in AI integration and product innovation, with AI Resident Assistant live in six states and new AI-enabled contracts.

Financial highlights

• Q4 non-GAAP operating margin was 24.1%; full-year margin was 26%, up 150 bps.

• Q4 non-GAAP net income was $115.1 million ($2.64 per share), up 7.8% year-over-year.

• Full-year 2025 total revenues were $2.33 billion, up 9.1% year-over-year; recurring revenues accounted for 87.1% of total.

• Adjusted EBITDA for 2025 was $650.4 million, up 14.5% year-over-year.

• Maintenance and professional services revenues declined as clients migrated to SaaS.

Outlook and guidance

• 2026 revenue guidance: $2.5–$2.55 billion, implying ~8.3% growth at midpoint; excluding Texas contract, growth is 10%.

• Subscription revenue expected to grow 12–15%; SaaS revenue 20.5–22.5%; transaction revenue 5–7% (10–12% excluding Texas contract).

• GAAP diluted EPS expected between $8.36 and $8.61; non-GAAP EPS between $12.40 and $12.65.

• Free cash flow margin projected at 26–28%; R&D expense $242–$247 million; capital expenditures $24–$26 million.

• Guidance excludes impact from pending For The Record acquisition.