A month has gone by since the last earnings report for Jack Henry (JKHY). Shares have lost about 2.5% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Jack Henry due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important catalysts.
Jack Henry & Associates Q4 Earnings Beat Estimates, Revenues Rise Y/Y
Jack Henry & Associates reported fourth-quarter fiscal 2025 GAAP earnings of $1.75 per share, beating the Zacks Consensus Estimate by 19.9%. The figure jumped 26.4% year over year.
Jack Henry & Associates’ revenues of $615.4 million beat the Zacks Consensus Estimate by 1.6%. The figure increased 9.9% year over year.
After adjusting for deconversion revenues of $20.5 million, non-GAAP revenues were $594.9 million, up 7.5% year over year.
JKHY’s Q4 Details
Revenues from Services and Support (57.1% of total revenues) were $351.2 million, up 10.9% year over year, primarily driven by growth in data processing and hosting revenues. The figure beat the consensus mark of $340 million.
Fourth-quarter fiscal 2025 revenues from Processing (42.9% of total revenues) were $264.1 million, up 8.6% year over year, primarily driven by growth in card, transaction and digital, and payment processing revenues. The figure marginally surpassed the consensus mark of $263 million.
Revenues from Core segments (30.8% of total revenues) in the fourth quarter of fiscal 2025 were $189.7 million, up 10.3% year over year. Revenues from Payments (37.3% of total revenues) were $229.3 million, which rose 7.9% year over year. Revenues from Complementary (28.5% of total revenues) were $175.1 million, up 12.9% year over year.
Revenues from Corporate and Other (3.4% of total revenues) were $21.2 million, up 5.3% year over year.
JKHY’s fiscal fourth-quarter adjusted EBITDA was $189.2 million, up 10.9% year over year. The adjusted EBITDA margin expanded 100 basis points (bps) year over year to 31.8%.
Adjusted operating income increased 14.8% year over year to $137.8 million. The adjusted operating margin increased 150 bps year over year to 23.2%.
JKHY’s Balance Sheet & Cash Flow
As of June 30, 2025, JKHY’s cash and cash equivalents were $102 million compared with $39.9 million as of March 31, 2025.
JKHY Lowers 2025 Guidance
For fiscal 2026, Jack Henry & Associates initiated its GAAP revenue guidance to $2.50-$2.48 billion.
JKHY expects non-GAAP revenues of $2.48-$2.46 billion for fiscal 2026.
The GAAP operating margin is anticipated between 24.2% and 24%. The adjusted operating margin is expected to be between 23.6% and 23.4%.
Management expects GAAP earnings in the range of $6.44-$6.32 per share for fiscal 2026.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
VGM Scores
At this time, Jack Henry has a great Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Charting a somewhat similar path, the stock has a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Jack Henry has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Jack Henry is part of the Zacks Computers - IT Services industry. Over the past month, Serve Robotics Inc. (SERV), a stock from the same industry, has gained 26.7%. The company reported its results for the quarter ended June 2025 more than a month ago.
Serve Robotics Inc. reported revenues of $0.64 million in the last reported quarter, representing a year-over-year change of +36.2%. EPS of -$0.36 for the same period compares with -$0.27 a year ago.
Serve Robotics Inc. is expected to post a loss of $0.37 per share for the current quarter, representing a year-over-year change of -85%. Over the last 30 days, the Zacks Consensus Estimate has changed -0.5%.
Serve Robotics Inc. has a Zacks Rank #4 (Sell) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.
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Jack Henry & Associates, Inc. (JKHY): Free Stock Analysis Report Serve Robotics Inc. (SERV): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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