Jack Henry & Associates, Inc. Reports Second Quarter Fiscal 2026 Results

Second quarter summary:

Fiscal year-to-date summary:

Full year fiscal 2026 guidance (Dollars in millions): 3

Current

GAAP

Low

High

Revenue

$2,508

$2,525

Operating margin 4

24.3 %

24.5 %

EPS

$6.61

$6.72

Non-GAAP 5

Adjusted revenue

$2,474

$2,491

Adjusted operating margin

23.7 %

23.9 %

MONETT, Mo., Feb. 3, 2026 /PRNewswire/ -- Jack Henry & Associates, Inc. (Nasdaq: JKHY), a leading financial technology provider, today announced results for fiscal second quarter ended December 31, 2025.

1 See tables below on page 4 reconciling non-GAAP financial measures to GAAP.

2See table below on page 14 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 9 reconciling fiscal year 2026 GAAP to non-GAAP guidance.

According to Greg Adelson, President and CEO, "We are pleased to report very strong financial results for the second quarter of our fiscal year. Our sales teams delivered outstanding results across all areas, including our core segment where we won 22 competitive core deals in the quarter while maintaining a robust pipeline fueled by a growing demand environment. Our new public cloud-native solutions – including the Jack Henry Platform™, Tap2Local™ and Rapid Transfers – are experiencing strong momentum and providing meaningful competitive advantages for our bank and credit union clients. We are extremely well-positioned in the market and remain laser-focused on our key differentiators of culture, service, innovation, strategy, and execution."

Operating Results

Revenue, operating expenses, operating income, and net income for the fiscal three and six months ended December 31, 2025, compared to the fiscal three and six months ended December 31, 2024, were as follows:

Revenue

(Unaudited, dollars in thousands)

Three Months Ended

December 31,

% Change

Six Months Ended

December 31,

% Change

2025

2024

2025

2024

Revenue

Services and Support

$ 345,809

$ 323,027

7.1 %

$ 722,659

$ 679,706

6.3 %

Percentage of Total Revenue

55.8 %

56.3 %

57.2 %

57.9 %

Processing

273,525

250,821

9.1 %

541,412

495,123

9.3 %

Percentage of Total Revenue

44.2 %

43.7 %

42.8 %

42.1 %

REVENUE

$ 619,334

$ 573,848

7.9 %

$ 1,264,071

$ 1,174,829

7.6 %

Operating Expenses and Operating Income

(Unaudited, dollars in thousands)

Three Months Ended

December 31,

% Change

Six Months Ended

December 31,

% Change

2025

2024

2025

2024

Cost of Revenue

$ 350,989

$ 332,850

5.4 %

$ 699,554

$ 676,282

3.4 %

Percentage of Total Revenue 6

56.7 %

58.0 %

55.3 %

57.6 %

Research and Development

42,228

41,095

2.8 %

81,505

80,780

0.9 %

Percentage of Total Revenue 6

6.8 %

7.2 %

6.4 %

6.9 %

Selling, General, and Administrative

66,969

76,901

(12.9) %

139,799

143,489

(2.6) %

Percentage of Total Revenue 6

10.8 %

13.4 %

11.1 %

12.2 %

OPERATING EXPENSES

460,186

450,846

2.1 %

920,858

900,551

2.3 %

OPERATING INCOME

$ 159,148

$ 123,002

29.4 %

$ 343,213

$ 274,278

25.1 %

Operating Margin 6

25.7 %

21.4 %

27.2 %

23.3 %

Net Income

(Unaudited, in thousands,

except per share data)

Three Months Ended

December 31,

% Change

Six Months Ended

December 31,

% Change

2025

2024

2025

2024

Income Before Income Taxes

$ 164,193

$ 127,381

28.9 %

$ 354,511

$ 284,179

24.7 %

Provision for Income Taxes

39,525

29,536

33.8 %

85,856

67,143

27.9 %

NET INCOME

$ 124,668

$ 97,845

27.4 %

$ 268,655

$ 217,036

23.8 %

Diluted earnings per share

$ 1.72

$ 1.34

28.6 %

$ 3.70

$ 2.97

24.5 %

According to Mimi Carsley, CFO and Treasurer, "Our second quarter results included continuing robust growth in key areas of our revenue that include solid growth in cloud revenue, demand momentum from our faster payments products, card and digital. Overall, revenue grew 8% on a GAAP basis and 7% on a non-GAAP basis. Revenue growth contributed to non-GAAP operating income growth of over 24%, benefitting from our disciplined approach to costs and lower than normal medical claims experience on our self-insured healthcare plan."

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 and six months ended December 31, 2025, compared to the fiscal three and six months ended December 31, 2024, excluding the impacts of deconversions in the fiscal quarters and fiscal year-to-date periods ended December 31, 2025, and December 31, 2024, the gain on sale of assets, net, in the current fiscal quarter and fiscal year-to-date period, the impact of a contract change in the prior fiscal quarter and fiscal year-to-date period, and the acquisition in the current fiscal quarter and fiscal year-to-date period.

(Unaudited, dollars in thousands)

Three Months Ended

December 31,

Change

Six Months Ended

December 31,

Change

2025

2024

2025

2024

GAAP Revenue*

$ 619,334

$ 573,848

7.9 %

$ 1,264,071

$ 1,174,829

7.6 %

Adjustments:

Deconversion revenue

(6,212)

(69)

(14,838)

(3,766)

Revenue related to a contract

change

—

(1,223)

—

(13,471)

Revenue from the acquisition

(1,945)

—

(1,945)

—

NON-GAAP ADJUSTED REVENUE*

$ 611,177

$ 572,556

6.7 %

$ 1,247,288

$ 1,157,592

7.7 %

GAAP Operating Income

$ 159,148

$ 123,002

29.4 %

$ 343,213

$ 274,278

25.1 %

Adjustments:

Operating (income) loss from

deconversions

(3,600)

622

(10,701)

(2,873)

Operating income related to a

contract change

—

(164)

—

(1,970)

Gain on sale of assets, net

(3,032)

—

(6,829)

—

Operating (income) loss from the

acquisition

984

—

984

—

NON-GAAP ADJUSTED OPERATING

INCOME

$ 153,500

$ 123,460

24.3 %

$ 326,667

$ 269,435

21.2 %

Non-GAAP Adjusted Operating

Margin**

25.1 %

21.6 %

26.2 %

23.3 %

GAAP Net Income

$ 124,668

$ 97,845

27.4 %

$ 268,655

$ 217,036

23.8 %

Adjustments:

Net (income) loss from deconversions

(3,600)

622

(10,701)

(2,873)

Net income related to a contract

change

—

(164)

(1,970)

Gain on sale of assets, net

(3,032)

—

(6,829)

—

Net loss from the acquisition

984

—

984

—

Tax impact of adjustments***

1,356

(110)

3,971

1,162

NON-GAAP ADJUSTED NET INCOME

$ 120,376

$ 98,193

22.6 %

$ 256,080

$ 213,355

20.0 %

*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 December 31, 2025, and 2024 which was $6,212 for the current fiscal year quarter and $69 for the prior fiscal year quarter, and reducing the three months ended December 31, 2024, amount also for revenue related to a contractual change of $1,223, results in non-GAAP adjusted services and support revenue growth of 5.6% quarter over quarter. Processing revenue less revenue from the acquisition for the three months ended December 31, 2025, of $1,945, results in non-GAAP adjusted processing revenue growth of 8.3% quarter over quarter.

Services and support revenue less deconversion revenue for the six months ended December 31, 2025, and 2024 which was $14,838 for the current fiscal year period and $3,766 for the prior fiscal year period, and reducing the six months ended December 31, 2024, amount also for revenue related to a contractual change of $13,471, results in non-GAAP adjusted services and support revenue growth of 6.8% period over period. Processing revenue less revenue from the acquisition for the three months ended December 31, 2025, of $1,945, results in non-GAAP adjusted processing revenue growth of 9.0% period over period.

**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 and six months ended December 31, 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 December 31, 2025

(Unaudited, dollars in thousands)

Core

Payments

Complementary

Corporate

and Other

Total

GAAP REVENUE

$ 186,100

$ 231,975

$ 181,708

$ 19,551

$ 619,334

Non-GAAP adjustments*

(3,050)

(3,342)

(1,702)

(63)

(8,157)

NON-GAAP ADJUSTED REVENUE

183,050

228,633

180,006

19,488

611,177

GAAP COST OF REVENUE

74,930

120,044

69,265

86,750

350,989

Non-GAAP adjustments*

(703)

(2,547)

(288)

(94)

(3,632)

NON-GAAP ADJUSTED COST OF REVENUE

74,227

117,497

68,977

86,656

347,357

GAAP SEGMENT INCOME

$ 111,170

$ 111,931

$ 112,443

$ (67,199)

Segment Income Margin**

59.7 %

48.3 %

61.9 %

(343.7) %

NON-GAAP ADJUSTED SEGMENT INCOME

$ 108,823

$ 111,136

$ 111,029

$ (67,168)

Non-GAAP Adjusted Segment Income Margin**

59.4 %

48.6 %

61.7 %

(344.7) %

Research and Development

42,228

Selling, General, and Administrative

66,969

Non-GAAP adjustments unassigned to a segment***

1,123

NON-GAAP TOTAL ADJUSTED OPERATING EXPENSES

457,677

NON-GAAP ADJUSTED OPERATING INCOME

$ 153,500

*Revenue non-GAAP adjustments for the Payments segment were ($1,945) of acquisition revenue and ($1,397) of deconversion revenue. Revenue non-GAAP adjustments for the remainder of the segments were deconversion revenue. Cost of revenue non-GAAP adjustments for the Payments segment were ($2,409) of acquisition costs and ($138) of deconversion costs. Cost of revenue non-GAAP adjustment for the Corporate and Other segment was acquisition costs. Cost of revenue non-GAAP adjustments for the remainder of the segments were deconversion costs.

**Segment income margin is calculated by dividing segment income by revenue for each segment. Non-GAAP adjusted segment income margin is calculated by dividing non-GAAP adjusted segment income by non-GAAP adjusted revenue for each segment.

***Non-GAAP adjustments unassigned to a segment were a gain on sale of assets of $3,032 less deconversion costs of $1,484, research and development costs related to the acquisition of $371, and selling, general, and administrative costs related to the acquisition of $54.

Three Months Ended December 31, 2024

(Unaudited, dollars in thousands)

Core

Payments

Complementary

Corporate

and Other

Total

GAAP REVENUE

$ 171,607

$ 214,836

$ 165,732

$ 21,673

$ 573,848

Non-GAAP adjustments*

(1,203)

(34)

(60)

(1,292)

NON-GAAP ADJUSTED REVENUE

170,404

214,802

165,672

21,678

572,556

GAAP COST OF REVENUE

70,324

114,738

64,542

83,246

332,850

Non-GAAP adjustments*

(1,147)

(53)

(99)

—

(1,299)

NON-GAAP ADJUSTED COST OF REVENUE

69,177

114,685

64,443

83,246

331,551

GAAP SEGMENT INCOME

$ 101,283

$ 100,098

$ 101,190

$ (61,573)

Segment Income Margin**

59.0 %

46.6 %

61.1 %

(284.1) %

NON-GAAP ADJUSTED SEGMENT INCOME

$ 101,227

$ 100,117

$ 101,229

$ (61,568)

Non-GAAP Adjusted Segment Income Margin

59.4 %

46.6 %

61.1 %

(284.0) %

Research and Development

41,095

Selling, General, and Administrative

76,901

Non-GAAP adjustments unassigned to a segment***

(451)

NON-GAAP TOTAL ADJUSTED OPERATING EXPENSES

449,096

NON-GAAP ADJUSTED OPERATING INCOME

$ 123,460

*Revenue non-GAAP adjustments for the Core segment were ($1,223) of revenue related to the contractual change and $20 of deconversion revenue. Revenue non-GAAP adjustments for the remainder of the segments were deconversion revenue. Cost of revenue non-GAAP adjustments for the Core segment were cost of revenue related to a contractual change of ($1,059) and ($88) of deconversion costs. Cost of revenue non-GAAP adjustments for the remainder of the segments were deconversion costs.

***Non-GAAP adjustments unassigned to a segment were deconversion costs.

Six Months Ended December 31, 2025

(Unaudited, dollars in thousands)

Core

Payments

Complementary

Corporate

and Other

Total

GAAP REVENUE

$ 381,393

$ 462,868

$ 375,926

$ 43,884

$ 1,264,071

Non-GAAP adjustments*

(6,269)

(6,825)

(3,578)

(111)

(16,783)

NON-GAAP ADJUSTED REVENUE

375,124

456,043

372,348

43,773

1,247,288

GAAP COST OF REVENUE

148,067

238,703

141,526

171,258

699,554

Non-GAAP adjustments*

(1,146)

(2,698)

(596)

(95)

(4,535)

NON-GAAP ADJUSTED COST OF REVENUE

146,921

236,005

140,930

171,163

695,019

GAAP SEGMENT INCOME

$ 233,326

$ 224,165

$ 234,400

$ (127,374)

Segment Income Margin**

61.2 %

48.4 %

62.4 %

(290.3) %

NON-GAAP ADJUSTED SEGMENT INCOME

$ 228,203

$ 220,038

$ 231,418

$ (127,390)

Non-GAAP Adjusted Segment Income Margin

60.8 %

48.2 %

62.2 %

(291.0) %

Research and Development

81,505

Selling, General, and Administrative

139,799

Non-GAAP adjustments unassigned to a segment***

4,298

NON-GAAP TOTAL ADJUSTED OPERATING EXPENSES

920,621

NON-GAAP ADJUSTED OPERATING INCOME

$ 326,667

*Revenue non-GAAP adjustments for the Payments segment were ($1,945) of acquisition revenue and ($4,880) of deconversion revenue. Revenue non-GAAP adjustments for the remainder of the segments were deconversion revenue. Cost of revenue non-GAAP adjustments for the Payments segment were ($2,409) of acquisition costs and ($289) of deconversion costs. Cost of revenue non-GAAP adjustments for the Corporate and Other segment were ($94) of acquisition costs and ($1) of deconversion costs. Cost of revenue non-GAAP adjustments for the remainder of the segments were deconversion costs.

***Non-GAAP adjustments unassigned to a segment were a gain on sale of assets of $6,829 less deconversion costs of $2,106, research and development costs related to the acquisition of $371, and selling, general, and administrative costs related to the acquisition of $54.

Six Months Ended December 31, 2024

(Unaudited, dollars in thousands)

Core

Payments

Complementary

Corporate

and Other

Total

GAAP REVENUE

$ 365,896

$ 426,758

$ 342,012

$ 40,163

$ 1,174,829

Non-GAAP adjustments*

(14,738)

(1,948)

(533)

(18)

(17,237)

NON-GAAP ADJUSTED REVENUE

351,158

424,810

341,479

40,145

1,157,592

GAAP COST OF REVENUE

151,271

227,757

131,686

165,568

676,282

Non-GAAP adjustments*

(11,626)

(71)

(159)

—

(11,856)

NON-GAAP ADJUSTED COST OF REVENUE

139,645

227,686

131,527

165,568

664,426

GAAP SEGMENT INCOME

$ 214,625

$ 199,001

$ 210,326

$ (125,405)

Segment Income Margin**

58.7 %

46.6 %

61.5 %

(312.2) %

NON-GAAP ADJUSTED SEGMENT INCOME

$ 211,513

$ 197,124

$ 209,952

$ (125,423)

Non-GAAP Adjusted Segment Income Margin

60.2 %

46.4 %

61.5 %

(312.4) %

Research and Development

80,780

Selling, General, and Administrative

143,489

Non-GAAP adjustments unassigned to a segment***

(538)

NON-GAAP TOTAL ADJUSTED OPERATING EXPENSES

888,157

NON-GAAP ADJUSTED OPERATING INCOME

$ 269,435

*Revenue non-GAAP adjustments for the Core segment were ($13,471) of revenue related to the contractual change and ($1,267) of deconversion revenue. Revenue non-GAAP adjustments for the remainder of the segments were deconversion revenue. Cost of revenue non-GAAP adjustments for the Core segment were cost of revenue related to a contractual change of ($11,501) and ($125) of deconversion costs. Cost of revenue non-GAAP adjustments for the remainder of the segments were deconversion costs.

***Non-GAAP adjustments unassigned to a segment were deconversion costs.

The table below shows our GAAP to non-GAAP guidance for the fiscal year ending June 30, 2026. Fiscal year 2026 non-GAAP guidance excludes the impacts of deconversion revenue and related operating expenses, acquisition revenues and related operating expenses, the revenues and operating expenses related to a contractual change, and the gain on sale of assets, and assumes no additional acquisitions or dispositions will be made during the fiscal year.

GAAP to Non-GAAP GUIDANCE (Dollars in

millions, except per share data)

Annual FY'26

Adjusted for

FY26

Comparison

Reported

Contractual

Change

Low

High

FY25

GAAP REVENUE

$ 2,508

$ 2,525

$ 2,375

$ —

Growth

5.6 %

6.3 %

Deconversions*

—

Acquisition

—

Contractual change

—

NON-GAAP ADJUSTED REVENUE**

$ 2,474

$ 2,491

$ 2,326

$ 2,341

$ (16)

Non-GAAP Adjusted Growth

6.4 %

7.1 %

GAAP OPERATING EXPENSES

$ 1,900

$ 1,906

$ 1,807

$ —

Growth

5.2 %

5.5 %

Deconversion costs*

—

Acquisition costs

—

Contractual change

—

Gain on sale of assets

(7)

—

NON-GAAP ADJUSTED OPERATING EXPENSES**

$ 1,889

$ 1,895

$ 1,787

$ 1,800

$ (14)

Non-GAAP Adjusted Growth

5.7 %

6.1 %

GAAP OPERATING INCOME

$ 609

$ 619

$ 569

$ —

Growth

7.0 %

8.8 %

GAAP OPERATING MARGIN

24.3 %

24.5 %

23.9 %

NON-GAAP ADJUSTED OPERATING INCOME**

$ 586

$ 596

$ 539

$ 541

$ (2)

Non-GAAP Adjusted Growth

8.7 %

10.6 %

NON-GAAP ADJUSTED OPERATING MARGIN

23.7 %

23.9 %

23.2 %

23.1 %

GAAP EPS

$ 6.61

$ 6.72

$ 6.24

$ —

Growth

6.0 %

7.7 %

*Deconversion revenue and related operating expenses are based on actual results for fiscal six months ended December 31, 2025, and estimates for the remainder of the fiscal year 2026. See the Company's Form 8-K filed with the Securities and Exchange Commission on January 27, 2026.

**GAAP to Non-GAAP revenue, operating expenses, and operating income may not foot due to rounding.

Balance Sheet and Cash Flow Review

*See table below for Net Cash Provided by Operating Activities and on page 14 for Return on Average Shareholders' Equity. Tables reconciling the non-GAAP measures Free Cash Flow and Net Operating Profit After Tax Return on Invested Capital (NOPAT ROIC) to GAAP measures are on pages 14 and 15. See the Use of Non-GAAP Financial Information section below for the definitions of Free Cash Flow and NOPAT ROIC.

The following table summarizes net cash from operating activities:

(Unaudited, in thousands)

Six Months Ended December 31,

2025

2024

Net income

$ 268,655

$ 217,036

Depreciation

20,743

22,731

Amortization

84,304

79,517

Change in deferred income taxes

69,734

(8,745)

Other non-cash expenses

9,416

15,535

Change in receivables

21,385

49,811

Change in deferred revenue

(92,379)

(119,463)

Change in other assets and liabilities*

(108,603)

(49,879)

NET CASH FROM OPERATING ACTIVITIES

$ 273,255

$ 206,543

*For the fiscal six months ended December 31, 2025, the change in other assets and liabilities includes the change in prepaid expenses, deferred costs and other of $(56,056), accrued expenses of $(34,863), income taxes of $(9,345), and the change in accounts payable of $(8,339). For the fiscal six months ended December 31, 2024, the change in other assets and liabilities includes the change in prepaid expenses, deferred costs and other of $(34,384), the change in accrued expenses of $(19,450), the change in accounts payable of $(5,583) partially offset by the change in income taxes of $9,538.

The following table summarizes net cash from investing activities:

(Unaudited, in thousands)

Six Months Ended December 31,

2025

2024

Payment for acquisitions

$ (42,391)

$ —

Capital expenditures

(30,096)

(29,469)

Proceeds from sale of assets

24,572

—

Purchased software

(2,908)

(3,528)

Computer software developed

(92,484)

(85,803)

Purchase of investments

(13,500)

(2,000)

Proceeds from investments

1,000

NET CASH FROM INVESTING ACTIVITIES

$ (155,807)

$ (119,800)

The following table summarizes net cash from financing activities:

(Unaudited, in thousands)

Six Months Ended December 31,

2025

2024

Borrowings on credit facilities

$ 125,000

$ 165,000

Repayments on credit facilities

(105,000)

(165,000)

Purchase of treasury stock

(125,237)

(17,050)

Dividends paid

(83,979)

(80,193)

Net cash from issuance of stock and tax related to stock-based compensation

(1,969)

(2,131)

NET CASH FROM FINANCING ACTIVITIES

$ (191,185)

$ (99,374)

Use of Non-GAAP Financial Information

Generally Accepted Accounting Principles (GAAP) is the term used to refer to the standard framework of guidelines for financial accounting in the United States. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizing transactions in the preparation of financial statements. In addition to reporting financial results in accordance with GAAP, we have provided certain non-GAAP financial measures, including adjusted revenue, adjusted segment revenue, adjusted operating income, adjusted segment income, adjusted cost of revenue, adjusted segment cost of revenue, adjusted operating expenses, adjusted operating margin, adjusted segment income margin, non-GAAP earnings before interest, taxes, depreciation, and amortization (non-GAAP EBITDA), free cash flow, net operating profit after tax return on invested capital (NOPAT ROIC), and non-GAAP adjusted net income.

We believe non-GAAP financial measures help investors better understand the underlying fundamentals and true operations of our business. Adjusted revenue, adjusted segment revenue, adjusted operating income, adjusted operating margin, adjusted segment income, adjusted segment income margin, adjusted cost of revenue, adjusted segment cost of revenue, adjusted operating expenses, and adjusted net income eliminate one-time deconversion revenue and associated costs, the gain on sale of assets, net, an acquisition, and a contractual change, which management believes are not indicative of the Company's operating performance. Such adjustments give investors further insight into our performance. Non-GAAP EBITDA is defined as net income attributable to the Company before the effect of interest expense, taxes, depreciation, and amortization, adjusted for net income before the effect of interest expense, taxes, depreciation, and amortization attributable to eliminated one-time deconversions, the gain on sale of assets, net, an acquisition, and a contractual change. Free cash flow is defined as net cash from operating activities, less capitalized expenditures, internal use software, and capitalized software, plus proceeds from the sale of assets. NOPAT ROIC is defined as operating income for the trailing four quarters multiplied by one minus the average effective tax rate (ETR) for the trailing four quarters, with the result divided by average invested capital (average of the beginning and ending period balances). Management believes that non-GAAP EBITDA is an important measure of the Company's overall operating performance and excludes certain costs and other transactions that management deems one time or non-operational in nature; free cash flow is useful to measure the funds generated in a given period that are available for debt service requirements and strategic capital decisions; and NOPAT ROIC is a measure of the Company's allocation efficiency and effectiveness of its invested capital. For these reasons, management also uses these non-GAAP financial measures in its assessment and management of the Company's performance.

Non-GAAP financial measures used by the Company may not be comparable to similarly titled non-GAAP measures used by other companies. Non-GAAP financial measures have no standardized meaning prescribed by GAAP and therefore, are unlikely to be comparable with calculations of similar measures for other companies.

Any non-GAAP financial measures should be considered in context with the GAAP financial presentation and should not be considered in isolation or as a substitute for GAAP measures. Reconciliations of the non-GAAP financial measures to related GAAP measures are included.

About Jack Henry & Associates, Inc.®

Jack Henry TM (Nasdaq: JKHY) is a well-rounded financial technology company that strengthens connections between financial institutions and the people and businesses they serve. We are an S&P 500 company that prioritizes openness, collaboration, and user centricity — offering banks and credit unions a vibrant ecosystem of internally developed modern capabilities as well as the ability to integrate with leading fintechs. For nearly 50 years, Jack Henry has provided technology solutions to enable clients to innovate faster, strategically differentiate, and successfully compete while serving the evolving needs of their accountholders. We empower approximately 7,400 clients with people-inspired innovation, personal service, and insight-driven solutions that help reduce the barriers to financial health. Additional information is available at www.jackhenry.com.

Statements made in this news release that are not historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Because forward-looking statements relate to the future, they are subject to inherent risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to, those discussed in the Company's Securities and Exchange Commission filings, including the Company's most recent reports on Form 10-K and Form 10-Q, particularly under the heading Risk Factors. Any forward-looking statement made in this news release speaks only as of the date of the news release, and the Company expressly disclaims any obligation to publicly update or revise any forward-looking statement, whether because of new information, future events or otherwise.

Quarterly Conference Call

The Company will hold a conference call on February 4, 2026, at 7:45 a.m. Central Time, and investors are invited to listen at www.jackhenry.com. A webcast replay will be available approximately one hour after the event at ir.jackhenry.com/corporate-events-and-presentations and will remain available for one year.

Condensed Consolidated Statements of Income (Unaudited)

(Dollars in thousands, except per

share data)

Three Months Ended

December 31,

Change

Six Months Ended

December 31,

Change

2025

2024

2025

2024

REVENUE

$ 619,334

$ 573,848

7.9 %

$ 1,264,071

$ 1,174,829

7.6 %

Cost of Revenue

350,989

332,850

5.4 %

699,554

676,282

3.4 %

Research and Development

42,228

41,095

2.8 %

81,505

80,780

0.9 %

Selling, General, and

Administrative

66,969

76,901

(12.9) %

139,799

143,489

(2.6) %

EXPENSES

460,186

450,846

2.1 %

920,858

900,551

2.3 %

OPERATING INCOME

159,148

123,002

29.4 %

343,213

274,278

25.1 %

Interest income

6,187

7,159

(13.6) %

13,326

15,506

(14.1) %

Interest expense

(1,142)

(2,780)

(58.9) %

(2,028)

(5,605)

(63.8) %

Interest Income, net

5,045

4,379

15.2 %

11,298

9,901

14.1 %

INCOME BEFORE INCOME TAXES

164,193

127,381

28.9 %

354,511

284,179

24.7 %

Provision for Income Taxes

39,525

29,536

33.8 %

85,856

67,143

27.9 %

NET INCOME

$ 124,668

$ 97,845

27.4 %

$ 268,655

$ 217,036

23.8 %

Diluted net income per share

$ 1.72

$ 1.34

$ 3.70

$ 2.97

Diluted weighted average shares

outstanding

72,413

73,082

72,661

73,080

Consolidated Balance Sheet Highlights (Unaudited)

(In thousands)

December 31,

Change

2025

2024

Cash and cash equivalents

$ 28,216

$ 25,653

10.0 %

Receivables

298,458

283,223

5.4 %

Total assets

3,060,044

2,911,770

5.1 %

Accounts payable and accrued expenses

$ 191,905

$ 209,926

(8.6) %

Current and long-term debt

20,000

150,000

(86.7) %

Deferred revenue

270,994

269,469

0.6 %

Stockholders' equity

2,203,058

1,975,565

11.5 %

Calculation of Non-GAAP Earnings Before Income Taxes, Depreciation and Amortization (Non-GAAP EBITDA)

Three Months Ended

December 31,

% Change

Six Months Ended

December 31,

Change

(Dollars in thousands)

2025

2024

2025

2024

Net income

$ 124,668

$ 97,845

$ 268,655

$ 217,036

Net interest

(5,045)

(4,379)

(11,298)

(9,901)

Taxes

39,525

29,536

85,856

67,143

Depreciation and amortization

53,155

51,754

105,047

102,248

Less: Net income before interest

expense, taxes, depreciation and

amortization attributable to

eliminated one-time

adjustments*

(6,118)

458

(17,015)

(4,842)

NON-GAAP EBITDA

$ 206,185

$ 175,214

17.7 %

$ 431,245

$ 371,684

16.0 %

*The fiscal second quarter 2026 and 2025 adjustments for net income before interest expense, taxes, depreciation and amortization were for deconversions of ($3,600), a gain on sale of assets, net, of ($3,032), and an acquisition of $514, and were for deconversions of $622 and a contract change of ($164), respectively. The fiscal year-to-date 2026 and 2025 adjustments were for deconversions of ($10,701), a gain on sale of assets, net, of ($6,828), and an acquisition of $514, and were for deconversions of ($2,873) and a contractual change of ($1,969), respectively.

Calculation of Free Cash Flow (Non-GAAP)

Six Months Ended December 31,

(In thousands)

2025

2024

Net cash from operating activities

$ 273,255

$ 206,543

Capitalized expenditures

(30,096)

(29,469)

Internal use software

(2,908)

(3,528)

Proceeds from sale of assets

24,572

—

Capitalized software

(92,484)

(85,803)

FREE CASH FLOW

$ 172,339

$ 87,743

Net income

$ 268,655

$ 217,036

Operating cash conversion*

101.7 %

95.2 %

Free cash flow conversion (excluding proceeds

from sale of assets)*

55.0 %

40.4 %

*Operating cash conversion is net cash from operating activities divided by net income. Free cash flow conversion is free cash flow less proceeds from sale of assets of $24,572 for fiscal 2026 and $0 for fiscal 2025 divided by net income.

Calculation of the Return on Average Shareholders' Equity

December 31,

(In thousands)

2025

2024

Net income (trailing four quarters)

$ 507,367

$ 405,208

Average stockholder's equity (period beginning and ending

balances)

2,089,312

1,849,976

RETURN ON AVERAGE SHAREHOLDERS' EQUITY

24.3 %

21.9 %

Calculation of NOPAT ROIC (Non-GAAP)

December 31,

(In thousands)

2025

2024

Operating income (trailing four quarters)

$ 637,650

$ 512,003

Average Effective Tax Rate (trailing four quarters)

22.6 %

23.3 %

NOPAT operating income (trailing four quarters)*

493,541

392,706

Average invested capital (period beginning and ending balances)

2,174,312

2,052,476

NOPAT ROIC

22.7 %

19.1 %

*NOPAT operating income is calculated by multiplying the trailing four quarters operating income by one minus the average ETR. NOPAT ROIC is calculated by dividing NOPAT operating income by average invested capital (period beginning and ending balances).

FAQ for Analysts / Investors

1.) Why does fiscal 2025 non-GAAP revenue used for growth calculation not match reported fiscal 2025 non-GAAP revenue?

2.) What are some key elements of the outlook for the second half of fiscal 2026?

SOURCE Jack Henry & Associates, Inc.