TYL - Earnings call transcript Q3 2021 | Tyler Technologies, Inc.

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Operator

Hello. And welcome to today’s Tyler Technologies Third Quarter 2021 Conference Call.

Your host for today’s call is Lynn Moore, President and CEO of Tyler Technologies. At this time, all participants are in listen-only mode. Later we will conduct a question-and-answer session, and instructions will follow at that time. this being reminder, XX, today, a XXXX. as conference recorded is October And go Moore, ahead. Lynn please

Lynn Moore

Jason, welcome Officer. you, Brian Thank and Miller, today With our is me Chief Financial to our call.

the First, for I’d statement. Brian give like Safe to Harbor

quarter take Next, will then questions. results. end Brian? review on comments additional our Brian with of and some I’ll details and comments have I’ll some our the then we’ll

Brian Miller

Thanks, Lynn.

could certain include statements projections of considered risks. differ projections. to all this specify Safe the Such information which note uncertainties, conference last the that other materially to make provide Form corresponding results of Private the risks course may year those actual historical period profits. would information of growth provision We Litigation the Harbor we today filings on prospects, During and forward-looking future we XX-K Reform XXXX, cause management may on Please concerning company’s to and to these SEC information the revenues, our Act than other otherwise. the are relate call, and of and Securities you unless call refer statements make will expenses that under Lynn? comparisons are statements more from for subject and

Lynn Moore

Brian. Thanks,

X.X%. and quarter in full third achieved quarter Total our of financial We cash NICs the revenues, most new by with adjusted EPS, the ever were including measures. year. was on XX.X%, results was established organic Our revenues flow, backlog. highs quarter bookings first our quarterly exceptionally and free first we the best non-GAAP grew EBITDA, growth and momentum building strong, This half of results it

NIC’s into from of revenues expected the in of COVID-XX by core Pandemic in variant, the in revenues for will NIC’s over first down TourHealth quarter. initiatives had which significantly we We first relatively revenues year. at $XX.X comprised the the were the the As revenues. Recurring were quarterly to they XXXX. X% and those But second a now our margins expect wind subscription revenues led half related of in plan surge time continue above and the grew have of growth XXX% low XX% result million. Unemployment Delta revenues half

Excluding growth XX.X%, the shift cloud. was NIC revenue revenues, our subscription accelerating at reflecting robust to

We quarters. have now greater revenue last growth quarters the achieved XX than XX subscription XX% of in

and or X% licenses excluding grew Software revenues XX.X% NIC. services

expected, compressed last compared As our margins third to quarter. year

claims, return pandemic Some impacted COVID in travel expenses like as continuation lower and this health by to billable the inclusion like revenues. initiative declined tradeshows margin of of Margins their have and that begun were year. COVID particularly margin NIC lower to due employee revenues the also as well XXXX by

operating declined As XXX a result, margin our to basis XX.X%. non-GAAP points

XX.X%. operating was Bookings last third Excluding our and a NICs at third costs, million, high quarter. related revenues non-GAAP margin in COVID reached than quarter double year $XXX record approximately initiative more

biggest Excluding of being fixed arrangement NIC, our with of State $XX renewal million grew the with XX.X%, bookings e-filing Illinois. the the fee contributor

teams. sales Community third-party call this Relief digital Housing claims. center We early the of at We’re between a very of quarter approximately to and million agreements pleased Solutions Tyler and with with solution and signed tenant, report Program NIC Rent joint valued landlord success $XX Department Virginia and for provide to efforts Development filing

solutions, Dashboards provide Administrative as processing as also will Socrata Insight from our capabilities. We payment Data well &

DMV vehicle new and manages with interacts with quarter and management West from also the and million NIC digital titling. revolutionize system the will titling Motor vehicles beyond $X.X contract how This came deal digital software with Division citizens. go businesses registration and Vehicles for largest modernization of Our Virginia SaaS the

utilizes replaced State with technology of the place to many DMVs has state arrangement, will The reducing operations leverages process, are solution lacking. security, our today, five in an every providing vehicle legacy The secure initial be process other which digital streamlining fraud and paper that flexibility Agreement the Master processes ownership the and nearly years. of to adding term govern related fully addition solutions. In vehicle secure

revenue the contracts In year. fees, also addition Kent. million agreement to to will highlight few Newcastle SaaS Delaware We generate the than estimated the counties quarter. signed more of sign and deals significant a Appraisal more transaction like I’d of $X per Services this with

iasWorld Other the have deals Canada, of reassessment the Appraisal County entire $XX value Tyler Newcastle for million. our be addition, and approximately the Buffalo with and Coupled Sussex Solution a Regional valued contract now SaaS under major $X.X also Municipality Illinois Appraisal County. arrangement. signed with our Services million. Solutions. ERP which SaaS signed selected for our SaaS iasWorld Wood Justice a Ohio, and Alberta, for In state. a quarter Tax Payment at Solutions, included approximately Appraisal with with County, Services The arrangements Franklin $X.X million Also million. includes with performing $X.X a combined Property valued deals for in will property Heights, Texas of at approximately million we Solution, & last Odyssey, Ohio $X.X County, approximately Summit Insights Arlington our our a contract SoftCode Supervision County, and Solution, at Civic contract million $X.X valued and Bayer Data

vaccination of quarter MicroPact was manage Solution Our contract provide to a the Entellitrak for $X.X Justice. our license contract the perpetual U.S. largest adaptations COVID to of million Department

Enterprise Islands the also We our contract the with ERP a and Mariana of license and $X.X Socrata for Munis Solutions. Northern Management, signed ExecuTime Commonwealth on-premises Asset million

e-filing federal Agreements that of Illinois, expected had which applications Revenue begin and from and States Solution of five-year XXXX. NIC’s to the We quarter’s also Enterprise renewal their vendors and a include was Digital of Internal Data with pay renewals taxes of On Socrata Insights in State with arrangement taxpayers as significant selected revenue expanded was & the been signed contract Oklahoma, including our allow to January last with several securely the we to of under that NIC a of Payment one Utah to call, that provide reported Service that two our platform. Processing would clients, existing with extensions State contract

filed protests Following NIC. with GAO any the including GAO, the award the protest it two notified to three on by award, the GAO. Prior was the awards, ruling to that canceling the the IRS entities the

select While submissions it the solicitation, the bidders IRS their NIC’s all has the not formally contract. proposals terminated current work has either contract, stop then IRS the it that under amend modify reevaluate allowing order to previous and a indicated the issued The will no potential information IRS stated it yet timing either has and option. or we regarding over months. with solicitation The the the which and process of coming have terminate the new not these options existing will in start procurement a of

in expect recent these do Given we not IRS award developments, recognize under the revenue any XXXX. to

concerns NIC’s misconduct contract was award raised cancel NIC. the protests its or not specific the are to to have improper by in behavior contract, been Tyler, public not related any to and the made not known or under NIC While performance the decision to allegations the of ability by under the perform successfully

community components. suite to accountable states. North commissary, on On a to fastest VendEngine one the the Its Safety accounting which market, of trust of we a fully full technologies than is Solutions, technology communications, third suite it and Arx Arx Arx XXX serves. to and platform deposit warehouse allows day XX have M&A Arx $XX.X VendEngine companies Public offer with of provides security, front, the of trust transparent, officers, platform counties a police technology modern enforcement million the combined including for applications more completed VendEngine trusted the the electronic quarter. including creates and their operating Tyler focused cloud-based further financial for cloud-based Public suites. leading a in America, in during and of Alert and corrections Safety Tyler’s enable growing acquisitions maximize resource is force increasing Arx is management The and software acquisition Community, and efficiency that transparency various justice management, ARR law of ordering comprehensive designed and a communities. and accessible informational additions safety and Arx and and strengthened building while approximately to

for like to of Brian quarter. provide results more on I’d Now, details the

Brian Miller

third non-GAAP non-GAAP of about up quarterly X.X% respectively. $XXX.X section our the release, our provided Yesterday, call, XX.X%. basis Lynn. of non-GAAP supplemental with million, We’ve results GAAP believe and under measures facilitate comparisons understanding Relations quarter $XXX.X recurring and Technologies X.X%, earnings backlog September the schedules its XXXX. GAAP revenues revenues On were revenues. Thanks, reconciliation A is included bookings, Investor we were up Financial for information information the tab and grew in XX.X%. software and for earnings industry. GAAP peers on Reports in provides on release. the Non-GAAP organic million, that with In results ended Tyler measures revenues to we’ve our our quarter reported posted including website an this the XX, of also

Subscription rose Software XXX.X%. XX.X%. license revenues revenues rose

from contribution the XX e-filing SaaS NIC Excluding in new sales. The shift payment very representing contract total to value. new ongoing software quarter $XXX.X arrangements a subscription-based to We and strong, this on-premises XX% portal, revenues had still than total six-fold average value growing revenues year, million, XX% XX quarter, revenues last revenues was $XX QX and subscriptions contracts on-premises from converted last comprised years, to approach In QX in last value. signed up of contract of to new $XX.X were representing NIC added in million included of $XX existing weighted approximately XXX approximately compared XXX first approximately and value million reflecting arrangements new X.X year. term subscription-based based E-filing our million, in contract and more Transaction XX.X%. clients, include new up year. last years were of subscription added we of contract compared cloud reached processing Subscription conversions, XX%. to total X.X value year, this high which a are

NIC, XX.X%. Excluding grew revenues transaction-based Tyler’s

approximately XX.X%, was total third quarter, our ARR at ARR million. was approximately was the arrangements billion, revenue up XX.X%, XXX% to $X.X non-GAAP annualized up non-GAAP $XXX transaction-based maintenance approximately million, approximately ARR non-GAAP was for or recurring flat $XXX and for ARR QX SaaS up software $XXX million, For

their Our was Because backlog the $X.XX only revenues of $XX XX.X%. end the at quarter million. based, NIC’s of up end transaction quarter at backlog to billion, are majority was vast the

of addition NIC, grew the Tyler’s XX.X%. Excluding backlog

million, fee XX.X%, revenues appraisal by very up fixed $XX bookings of our $XX million, were organic the addition the Lynn strong the Delaware at the and of approximately NIC. quarter fueled of State totaling two at $XXX deals transaction-based As noted, renewal up $XX million. Illinois On e-filing arrangement the of XXX.X% of $XXX were basis, -- bookings the an and robust includes approximately million in

an $X.X months approximately up $X.X and XX XX.X% approximately were billion, bookings billion, were trailing the XX.X%. For basis on up organic

million $XX were the Cash new added software quarter million, respectively. and both free highs and annual record recurring operations in $XXX.X cash revenue. million Our at in quarter flow bookings subscription the third from $XXX.X for third

Our balance sheet very strong. remains

our million. repaid and balance investments with quarter trailing $XX.X our of for we of We of $XX total quarter term approximately revolver of the and million the During million pro billion net leverage of the and million a outstanding EBITDA. paid times on in outstanding total reduction cash forma debt on loans ended down $XXX.X $X.XXX $XXX.X debt X.X

the net times expect by leverage approximately We be year to X end.

quarter. performance have the the full revenue strong to year-to-date fourth for and for our EPS our expectations and reflect year guidance raised We our XXXX

$X.X We billion. be will $X.XXX billion and expect will revenues XXXX non-GAAP and be and total total $X.XXX between billion $X.XXX between GAAP billion revenues

$XX and to wind million We the Services approximately expect TourHealth XXXX. are half first expected that revenues of in total will revenues Unemployment down COVID-related from of Pandemic include NIC’s

stock vary the GAAP awards We effective due may and and expect incentive be EPS the $X.XX XXXX will of significantly impact to tax on rate. GAAP between $X.XX, diluted

be We non-GAAP EPS guidance $X.XX. of release. between diluted details our expect earnings included are in and Other XXXX will our $X.XX

to Now, to back the I’d over turn like call Lynn.

Lynn Moore

with our we full of for core around and NIC June, both third priorities NIC from Tyler. Tyler’s discussed acquisition and When Thanks, results, as pleased from spoke its to investors quarter first in Brian. XXXX. the quarter four I’m part extremely operations we

up don’t the mess business. First,

businesses. both achieve our Second, for plans XXXX

objectives. teams leadership NIC our teams get are and joint retain Both say launch team. at are businesses initiatives the fourth, opportunities exceeding on Elizabeth actively the all And strategic Tyler. is team and establish and the ground and level executing NIC we executing integration with about leadership combination staff hit enthusiastic I’m happy identify Third, are of and the those long-term And plans. The XXXX and a Proudfit the strategies. of with we’ve on to aligned. under go-to-market high ahead sales our working running,

Colorado Insights plan reviews of joint Relief platform, and process We’ve the the Tyler’s integration and success Agencies of recent NIC team payments established products Processing, a managers are providing such are Program, We’re join organization. and manager NIC Regulatory in contract finalizing state Tyler’s general applications. to for our We’ve with entire and contracts some the already technology our state showcasing as Payment relationships NIC’s opportunities, Solutions Tyler NIC’s detailed Tyler/NIC payments includes and for Data & general Regulatory which also had team. enterprise that Department Tyler’s for Entellitrak early Socrata as Rent with contract Virginia the includes NIC the well as also Socrata solution of the

contract. contracts more have have solutions with identified up sales We Tyler pipeline speed market NIC’s from state than leveraging state XX of enterprise and to Tyler opportunities a time sell-through across qualified the NIC to opportunities enterprise current award multiple

Louisiana. Florida combined payments with build to sales in and early beginning also We’re pipeline, our

Indicators trends in are cases significantly above and are generally as up from and We continue positive XXXX see market public sales proposals, or at sector all pre-COVID demonstrations to activity. such in pipelines levels. some

-- competitive win high our factor. remains as reflected competitiveness rates Our strong significant our yet applications. not by Well, a major across

see has stimulus federal the starting the and American to being Plan. funded under purchasing through Act activity identified the Rescue We’re is CARES that

address two billion the $XXX clients by American of of National local significant A aid years. the pressures faced Act of the is Association public indicated and state and need that to legacy help under many notice modernize potentially increase. a expect and our plan over years, also billion survey measure employment the with governments, schools remote the that services to continue CIOs provide a tailwind by three budget two state Plan in CIOs and next $XXX to human prospects, provide work expect will to health of We to and for and welfare, relief they the Tyler CIOs needs. digital that next sector labor Rescue those services years of and services most will will aid priorities. said leaders and public to well-positioned systems

and also our initiative projects R&D toward on-premises We on with track conversions remain implementations AWS. our cloud in SaaS new progress with our and around hosting

migration operation a center Our product optimization, in is on data planning, and engaged continued focus maturity. cloud XXXX with operations team

until we’d over line and year. work retirement. CIO, express will that, our wish Q&A. with member a open Finally, I statewide Branch. Bieri, retirement like years best hosting appreciation Kevin early military leadership want tremendous also experience of month technology seasoned IT joined agencies who organization to newest organizations, former serving Kevin most corporations, as the the Tyler’s last statewide closely deep with managing government earlier executive his Tyler recently Matt for welcome his U.S. Kevin the Chief next the leadership I’d With infrastructures up XX IT this is Matt to team, of our like in Officer. to to the executive as Iwersen, courts, CIO Information leader and and him for for Judicial Matt’s judicial our Idaho for

Operator

ahead. [Operator question from comes BTIG. from go Please Matt first Instructions] VanVliet Our

Matt VanVliet

color nice guys. in if the job and was the question of using commentary press nice taking talked on looking of of stimulus in to terms pertaining coming and of Thanks the Thanks. most of they’re in newer market. its that terms have types us anything additional about finally jurisdictions release that around that projects of feel interested funding? into guess are where some additionally to have give for the I products activities to at Wondering budget are of way you’re more some morning like through terms quarter. pertaining Hey. you of maybe this of spend the Good you’ve to where that types some some both could in now, seeing and the morning, you making they funding that sort the and sales

Lynn Moore

Yeah. our a side. lot a lot really It’s I’d question. to across Sure. say, track we’re of I It’s Matt, we’ve a bit something really the starting good it think a little But on seen that seeing you’re enterprise solutions. more.

and We’re seeing over we’ve NIC. in a bit little schools on some seen

dozen there QX some a spending continue. that out spurred I’d through at QX, if there stimulus certainly to I being right few of are now, look that and that now are expect some of think right and you that deals federal

Matt VanVliet

what what business look following to us kind basis? But Thanks. sort guess, core full is Great. for I NIC looks one-time. then the help the some could business if the Thanks. that is continues And looking a of up, growth of exact of underlying in Brian, contributing on forward of the like and the just that the was understanding there guidance contribution kind of of like what on the year what like, kind contribution you

Brian Miller

Yeah.

in the of at the revenues a Tyler of and and So NIC, initiative last at the for at that we guess, I down. had fourth our forecasts, about $XX in the as the did expect exploiting quarter, fourth growth second had even quarter $XX our discussed, year NIC’s there’s $X.XXX be $XX now core midpoint We of then the the continued And thought the the about into around But core the some of XX% that in year. be so growth the quarter. would under or so tend seasonality the X.X% in midpoint on again, end quarter, revenues continuing guidance quarter year current that had would and quarter midpoint I’m the transaction next volumes for particularly million excluding And guidance when guidance NIC, around this around our to the million, million last we and those the operations quarter. the of COVID-related Tyler’s initiatives core holidays $XX around about half for around year full operations, be some fall beyond would initiatives another of some core imply, and was the would in fourth COVID billion the would quarter. they have of million growth fourth fourth end guidance sorry, have and -- third wind in QX their X% to we in full the the

reflects what the numbers. fourth fourth quarter is that guidance their our quarter probably So in

Matt VanVliet

Great. the the color. taking Thanks I appreciate all question. for

Operator

The Company. next Needham & question go Scott Berg ahead. from comes from Please

Scott Berg

guess up seen is, we a been if catch were earlier in pushed that those Lynn, Hi, deals decade questions I enjoying Lynn I period little several the were and bit, into kind Congrats just are here. dissect excluding the quarter here, quarter in quite stages of which of bookings deal more really NIC. especially how return current get on to you’ve Brian. good a or the strong from the last maybe the of a the much the so? or bookings cadence normalized of for a pandemic you quarter

Lynn Moore

Yeah.

look pandemic business different think absent in you I sort a last very things, is, of the of of Scott. XX was year. I as mentioned QX. at in that last activity couple we I the when were differently. combination large the it’s affected couple QX the parts market is a have of bit the comments, which little We my in our about quarter, But I’ve over difficult deals and so quarters think, obviously or what a a several did months over last signed talked

that just I’ve our example, the last really awards little you I mentioned, levels validate an harder end that well the think for example, activity, bit of what the example and actually that as Munis is, the we’ve harder some little of hit over that you’re strategy as sort pent-up pre-COVID product. years. a example that’s seeing both been and mid-to-higher are investments the was that and think and there, I for of are before think, a which you’re seeing bit financials I it’s of That you look exceeding couple some doing were was is deals at, and mentioned area what hit Some if

Scott Berg

like the the then thinking from follow I if roughly flat Brian, guidance year. expected And core in Thanks. Tyler year, related maybe subscription I Excellent. the guess, on kind mix back a is maybe from to around expecting? were your that’s perspective, out NIC, the deal added guidance Tyler versus a strong, increase little core I than more bookings for have the it of kind of certainly How stronger license revenues because you’re looks bookings mix up expected you what are maybe the bit subscription revenues, for probably deals, previously about would but

Brian Miller

say that’s Yeah. I’d accurate.

generally trend SaaS. continue the increasing to of mix percentage We’re toward expecting to an

a quarter for Now, in year. quarter, also trends know, typically a the higher that the SaaS. that of general, the which of last mix bit, where you is a that ongoing but continuation on-premises expect still is as Public case is primarily was the strong and fourth so we’ve seen we Safety, percentage tempers an But,

Lynn Moore

Yeah.

pandemic the look market And I’ll SaaS I our actually, now, mean, is of talked XX%, areas, again, our last mention, Munis this and that. north accelerated of think the we’re while going in way, are the XX%. they of you Scott, were financials -- at while code I of add end and deals I’d into there, before we that expected lower you amount it’s certainly north exceeded look year XX% expectations SaaS at to year be our even has we moving

is that So some there of headwind.

to as get we’ll the model continues on out, the side that. other I of think play

Scott Berg

Great Thanks guys. color. Excellent. the for quarter

Operator

The comes ahead. from next question go Ethan Please Wolfe from Research. Bruck

Alex Zukin

is Wolfe. here this Alex Hey, it’s -- think guys. -- It’s I from

So a for couple me. questions

to pick down in little think and we we in should how ask QX that I about about a wanted see bit bit the think think, maintenance Are starting beyond? you if up starting -- it sequentially. revenue the First, conversion was, the to a a about quarter, the, activity and is to revenue I maintenance

Brian Miller

Yeah.

accurate. that’s think I

kind into at of last the quarters all-time in couple us new number the highs conversions, which of we of have flips So the of look year four prior is quarters quarters, interest for the flipping. the back the certainly, you and filter in customers last on-prem each terms been new all have of the four in increasing more conversions business shifting that well last as and The just there’s exceeded or towards SaaS, saw an when growth. maintenance

does as that into maintenance the that they is are going -- subscription effect maintenance, flip they’re negative was. a on the about So what have generally the but revenues side Xx

a growth thing had the then the federal the and mandated -- the government other at business product And around of move component onto an SaaS side So our you well. our the that’s where towards subscriptions. less new in last a high on in to is product federal and the some the an of as year, some effect look continues legacy there last as that of then impact product that’s license business, well. off has as to over at has And shift more mix it on provided a the federal attrition bit growth states of

have point, the customers and So through continue moving a at next be the that to but significant be have those in those accelerate as case impact of the conversions those years some the we the biggest to ability AWS. and say, ongoing flips, I’d in that’ll likely over couple are acceleration

Lynn Moore

Yeah.

up year-over-year I significantly the that see flatten at to increases subscription started next think, line last will offset quarter. as you couple from those pace. flips maintenance and are summarize, grow out, by annual Alex, is, mentioned I getting over Brian continue proportionately flips, you’ll out which as probably contract continuing our licenses -- to years, an see look you’ll if Conversely, revenue to increasing to guess

Alex Zukin

you’re guys that the think it little impact, is in increase maybe going guess, for is that about, -- there one-time the should we is that about And the about about? reason that on be the any kind side, COVID that about in think first mandates? durable, as think think to an in sustainable more how those -- the growth there that have talked we bit core I level a NIC that that And variability acceleration on something, potential NIC revenues of X% they business or When COVID? you from that here Is starting base. from that when the or that so Perfect. we of like, think ex is that should be opportunities like, the we synergy from you the increasing talked see actually you year why half do of given to end next any that the to are trending

Lynn Moore

and getting guess, the State one. Carolina, with I say, would think, That while those I The said -- It’s margins areas, primary further -- be start the revenues that a I’ll contractor three in out guess about a of I subcontractor Carolina role, the move South I guess, testing, our I note, I’ve wouldn’t then continue a that of mean, COVID if will primary also interesting little is they’re What’s Yeah. doing down. Unemployment of out will that our rearview State assuming an expectation. before, role those our educated and means increase. I and personal but primarily will will Nevada of to eventually now is, it from expectation on the wind off, it revenues I where it’s a is think, a would so we’ve on taper last revenues be mentioned the as ended. bit Virginia I’d are Relief of it’s South right still the -- the mirror. stuff. that the happy we’re If

could have shows think the important their shows they also it growth rates talk about, agility going that enterprise is think, and contracts relationships state about the it new COVID ability they what’s their to though, solutions shows When and about quickly that forward. I really your up I and these that’s innovate, of team NIC’s with first things create exciting. question the you spin I what’s think was it initiative,

sales can’t they meet, I excited get you are, tell excited. as how they We’re teams together. the

talk part forward, NIC’s deals that those Public the and channels, in we’re sales NIC, of be about we can and Tyler & all I lot Data know Payments we segregate, conversely, and sort think selling that NIC we are at NIC would think continue because growth, and probably Civic of don’t help are through deals, what point see a part Socrata about products different with and to the going a already revenue these always our its Entellitrak I Tyler is were to move products Insights these forward, as overall to you we’ll underlying own. our we with but Tyler and as bring platform, that all revenue the Munis, believe this than higher able is Safety rationale going oh, pipeline seeing the growth Tyler’s and level but on of what we at overall won’t of them. some isolate it through drive We have acquisition will

Alex Zukin

That’s the way And XXXX next to the have IRS wanted how the dimensionalize about for at then to about a we thought last of for the what contract. should been before agreement and expectation in super for year? I any Is stream there revenue that of question in may terms us helpful. think least the that modeling ask cancellation

Lynn Moore

will that reasons for We’ll you first come expected. to bid the competitive up with uncertain, back going again and don’t going in a we time, because the There in be we I’ll the it contract. how my expected out the year. extremely sometime but it. to the this year, And number, have honest, revenue, I a revenues number, bit some starting the the the little Brian XXXX, get see Brian, and expansion start significant the payment of was in it’s revenues be you the forward. early -- we was the happen we but I could XXXX should were get procurement this But years later in and have won running revenues have… if think, fast in will real expectation

Brian Miller

Yeah.

that be believe think, the the existing another works fees. last a We won’t there after $XX virtually was gotten in on believe million had this will revenues while But the when to while the about process providers net expect award and gross number for in procurement we that and to quarter, range something that basis number revenues that, that were in certain have vendors talked held million we’re the was, IRS year. be I million $X we more, through there $X currently any million in XXXX, interchange and all I the multiple that $XX I

those now in already. started none a revenues weren’t So have of those --

But there a this that current pretty the be impact and how was fast it’s XXXX that our procurement we’ll goes takes So clear at see won’t base point nothing in away. new place.

Alex Zukin

it. Got you, Thank guys. Congrats.

Operator

next Securities. ahead. go Please comes Strauzer CJS from The question from Charlie

Charlie Strauzer

about the like Hi. for for Good know formal what guidance year? thoughts out some next morning. early I A quick you, you’re you to XXXX call, but don’t until question maybe thinking on, so next give

Lynn Moore

factors right Charlie, to variations, Well, go are lot you’re ahead now of a ourselves. We of right, don’t like we into out into There’s XXXX of that. that lot get -- we our planning. well

We’re planning expect with track still in of say, kind to our the process. early better on normal this stages. I’d I’d information later really we’re have year.

now I go too forecast early and think ahead it’s just XXXX. right little a to

Charlie Strauzer

trying of any to talk labor sure having cetera? companies That’s I’m fair. about cause labor side, that the No at qualified to labor a issues, have And as people, bit difficulties problem. wage not you et looking there, in find new inflation, Thanks. you immune then the well. little just a in Maybe can you’re lot side, the

Lynn Moore

point. a labor that’s pressures. going is across good in It’s wage immune There’s think, reading multiple -- Tyler evolving been now. industries. I And right the Charlie, There’s we’re what’s staffing say, that. I’d pressures. news, on hasn’t to market all The Yeah. certainly

it still figure is. transitory a little out about how is permanent I think there’s this how to versus

We for changes. leaving COVID people it of lifestyle seeing call You’re careers casualties. sort

competition accepted from tried hire that and work-from-home and work seeing that they that traditionally and to may we’re seeing more you’re work now wages people not dealing and have for as markets come in are to people with go into people You’re being more flexible well.

I you bit under plan. business across of think look if a lot units, little a we’re staffed our

the this. executive and that’s it that Our level, recruiters good top and job something Working HR responding immune at something mind. but you’re It’s Tyler doing we it. not right, our really are to really a hard, discussed has it’s team been to is of

Charlie Strauzer

bit site on people are more move back you when the on And up look to your employment fall? this speak and offices at kind little just current into still a you base, of asking

Lynn Moore

Yeah.

as jurist handled track the we’ve the it. approach -- So jurisdiction is, to taken a they’ve and phase-based is taken -- we’re of phase-based sort a on approach locally-based bit way we’ve different little each a

is I’d that probably of track office going full on That’s bit more we’re the of back first not exactly before. essentially a would that what it meant the sort so part of expect market to to the some we call at before so now little and COVID. means There right flexibility. in will today be come of And what What back year. the

Charlie Strauzer

Thank Great. much. you very

Operator

from ahead. comes from question next Rob Please Baird. The Oliver go

Rob Oliver

question, Good in about on guys Lynn, full you excited police. it My guys. of are wanted just the first products of for into a Safety, dive little Thank to gives bit, Public like deal terms it that Arx Great. suite you question sounds that you, guys is, morning.

we closing of follow-up. So a I expect mean, into the question what its sales levels more defined And just it’s safety and and I type a we went in about solutions you the it then be I means a your the customers guys And seeing Safety been wanted curious in from from really confidence deals environment? and broader all fund seems that year a had to on relative in and for available Safety. now that like just pipeline guys whether for Public here? your in you of to then that public quick where secured Public QX? ask would QX bag hearing are And are to about that important what folks

Lynn Moore

of the a helps that the this something Safety of we helps different more had that job, in Detroit, identifying it based missing office company our like around a Arx been a the our was the was acquisition. right, database risk to lot is Public on a is been product solution you’re a Yeah. rounds on lot sought of Even That’s it’s and suite. and by about are areas, like command has of of are And out new in of Thanks, that stress, excited more portfolio there and number activity and Public Arx They I’d that solution deals. going lot it’s a channels enforcement good really sell Chief small Rob. promote things something law of to that relatively is in which is Safety area officer insight right, more, you’re mitigation. has This something a wellness reform staff, Arx, had really that’s talk expect a helps acquisitions Public yeah, question. going in issues, supervisors, deals. been of really differentiator in of compliance in the it’s with doing Safety -- law helps sort our helps a Police, close a we’re we out Detroit. focus lately it and and partner be Public Solutions. our Arx Insight enforcement do to been become it to Safety really also had and in

they’re different were I for Safety be has You’re talked plus that we’ve seeing differently mentioned and up about number lot suggesting than the ever funding just licenses it more a in $X before. number wasn’t pretty expected of reasons looking deals year, this talked of you more will impacted, it’s had before you investments Public will earlier impacted that but XX% deals are, not is the the for Safety, We’ve made talk million solutions license parts and we’ve still are license good. that going these and more be Public The about types When our entities there business Public for year-over-year. the Safety got over of then of about.

-- and investments we’ve there, that, like that there and more us some is make to making I think initiatives we’ve acquisitions mobility the done a things been lot are even funding competitive. I the of and have round

I’m So the we still pretty future -- is Public about and very for that. Safety where excited with still where stand I’m

Rob Oliver

I one Great. that’s asked up, you stimulus did I Thanks, you great just And comments in guys the deals know, that, appreciate just briefly, that. some funding and you’re Matt, I federal specifically follow and But that think, first want to funds you Lynn. pipeline -- then it in because by on your are the fed starting and to touched mentioned, that I the just said of stim. both color. question spurred release here follow-up, doesn’t press think related I to about, that see

Just hearing you’re from curious, what customers.

and then, tailwind bulk of Tyler products many a is I and pretty of the would and available that if you wide over kind of think potential that mentioned assume not, Tyler’s qualify -- mentioned our years. You swath products -- can we you under

stimulus about it one federal think So to clear be Yes, is are two there to dollars ways about Tyler think to this, going way to are positive. it. flowing

think it. budgets spending that that for Another creates be opportunities of in being also about buckets? different kind more a would couple way of confidence up or Appreciate the is shored right to

Lynn Moore

are Yeah. look probably I’d impacted. at -- but if dozen few they’re part equation. QX suggesting and where in say, or there funding the being to deals partial of I’d comments I’m that funded, you not fully my they a is earlier, say they’re and clarify being the there QX. deals be may

touched for all the confidence in something the on with them that along I is is before that that confidence market what’s helpful blanket been on your believe generally around having think of and going I’ve is deals. I comment the behind

talk I when would these We than single are few about are out different federal I seeing know they don’t across Tyler. that necessarily products deals, others. dozen stimulus, I of more

schools. are there are dollars specifically Although, that stimulus to tied some

But, marketing it’s positive. that them, So, figure is them a I think, generally how dollars a prospective lot to the to it’s reason it’s speaking, which our we still team quantify with hard something of of Tyler. are clients clients sales are overall, conjunction part something a navigate are optimism think, of our help there have I together we it’s point. tailwind. But, access Generally our help for to lot educate that’s them -- it’s teams our still -- of trying out, do and actually a we this putting where clients materials It’s and in and still yeah, there it’s part at at can. our

Brian Miller

use restrictions us. there for the much is on what And American Plan, they it Rescue not can

have XXXX is percentage purchased that portfolio on. around been ARP it’s how the would that there spend going governments of so on or what there through determining we to lot flexibility it’s acquired in has generally around they’re until our and say, almost is anything the spend But the spent end -- And available even lot I’d funds in to they to they indications a be allocated, or very those spend far still of have those have Tyler those. funds. work can a So, those going there’s of small be is a of funds

Rob Oliver

Yeah.

route I buses whole or for one school to our think they’re two district. trying

give call. those I So to guys you a guys ask

from here you’ve Appreciate got in guys. that Connecticut. it. Thanks hopefully, So,

Operator

Evercore question Please comes Materne ahead. ISI. next from go from Kirk The

Kirk Materne

I now. rev right congrats the But on book up on a Yeah. ahead a could that the were things sort if quarter. trends good a but you some wondering about of NIC Brian an bookings that sort are Thanks in I NIC talk that now? obviously X% was lot. much of very make just know pleased bookings is bookings if tricky, there NIC’s level rate rec or for and basis with talk of core and you could of Lynn, you growth little Tyler I or right organic the realize the it

Brian Miller

Because they’re base bookings revenue… mostly transaction and their

Kirk Materne

Aligned.

Brian Miller

nice couple came …are a through They’re of revenues bit I of majority Tyler they reliable. transactions, through dealer that much our deals are vast generally, their had guess some software biggest there little NIC. pretty aligned, a I yes. mentioned They pretty software seasonality. across But, quarter, pretty have we the business coming this is are and aligned.

little saw So this growth bit higher a quarter, growth last quarter. lower we

are little and a their the is part One their growth the in impacted generally more as which the business is history given now. driver more up get records, back expect business things people those digitally that governments. significant COVID that is rebound been doing are is there of business had the a slow to transaction that of offsetting state right by areas but with But volumes to normal,

those would be pretty So, revenues and generally, similar. but bookings

Kirk Materne

already going a What this more technology, we be you portfolio I next of any look on of versus And terms have of have point you smaller focus be go-to-market. thinking to about you huge technology in way you time? much you in Brian. harmonizing broader I did harmonizing you on of your Thanks, helpful. That’s ahead a just as portfolio. of product sort again of Lynn, of focusing obviously Okay. have know the sort is assume go-to-market doing the and at on quarter, should then, but the a sort other XXXX, what year? sort what deals. tuck-ins this have couple strategy Is product the that the in temperature

Lynn Moore

we five larger do years lot right, year, three portfolio have of you’re a lot with ago. we even initiatives have think I So than do a of did We going four years, on.

We are We focused on. NIC. did spend just on billion over $X

We’re on clearly that. focused

to operations did to I couple couple think years sort little deals have NIC, other These we VendEngine, earlier optimize how And with M&A we’ve initiatives do we focused to internal our and generally things about bit talking clearly this go we’re I the products I’ve about talked a back cloud do there. a continue our we DataSpec. deals when and bit a pause, of in deliberate of we this that also ago, may of done where year. were of little we to we some and as approach year before a need works. said, on were things that our move We’re

next as we remain go though opportunistic. I year, think we’re going into to

while right If today. whether on in and look deals we though have going look medium large, or definitely fits that the small, to a execute it’s when deal there. would the and we need, position out I it still then that we would. expect is to will to activity at I Even of going over the months. to on have this at been all couple looking continue We’re still last I deals at deals. continue

Kirk Materne

Okay. That’s helpful. guys. All Thanks right. I’ll there. leave it

Operator

ahead. go comes Housum The from next from Northcoast Please question Keith Research.

Keith Housum

back perhaps changed like the the echo quarter and they Recall Is trajectory at prior records COVID history began. revisiting -- NIC perhaps the Good you not par previous it there not up great is been guys. morning, record for to I’ll guys. had? since growth Congratulations. that to question, was history the really anything go gross driver seems structurally driver And might for just NIC has that the business the

Lynn Moore

I didn’t question. the quite hear

Brian Miller

Oh! I that’s don’t -- anything changed we’re around not that. of structurally, aware fundamentally

that some to a are our in of change way know -- negative no the expect increases levels. renewals least able our get there and back there pricing. to Certainly, but is we’ve those rebound no pricing, and I information, will We change in their been in insurance getting been companies normal change hasn’t in at

change there’s DHR the don’t side. around So fundamental any think

Keith Housum

you. Got

and was contracts, Appreciate quarter And this conversations, back Okay. very the your are it. raised having remember renewals. time I Can coming for of of obviously, have previous as X.X was to the spend the of was raise I average length good. years short in contract -- on the to terms pricing about talk up contracts prices success are opportunity changes you renewal? guys you idea

Lynn Moore

Yeah.

success of to particularly the gives quarter increases we of We’ve those there last have to I think the I X% leading you maintenance generally injustice contracts in really courts as that. on of -- targets those on renewals, benefit Carolina been a straight generally in in to had with that And the XX-year we’re in agreement. hasn’t think terms annual back been And Occasionally, the change sooner. some targeted the large over are the this revenues terms like because shortening are lined through initial realize shorter the X% in the subscription term COVID. kind the range. We’ve said generally with us the a of same opportunity agreement, agreements. increases and North

do can the shorter and agreements with tried a bounce historically prefer achieve. So what around to in been have line bit. that to But we’ve has we pricing

Keith Housum

Thanks. Great.

Operator

comes from question Ho Blair Jonathan go & from Company. next ahead. The William Please

Jonathan Ho

Congrats up-sell additional of start potentially the the guys results. types on to some understanding color opportunity I these you just what out just morning. Arx made and and Good strong the is wanted recently maybe on that VendEngine Hi. with opportunities acquisitions to there.

Brian Miller

about Jonathan. larger. excited Yeah. VendEngine, we’re Sure, It pretty a was acquisition. bit that little

both. I We’re imply. didn’t excited mean But about to

Arx. about excited We’re

in area sort -- corrections as us been points for opportunity. standalone market product. part corrections our some around But existing which We’ve be between into corrections space RFPs with Safety And really expect inmate last have more it’s just more there. deals a that years for is also a our significant of corrections the there. number and years. we a and services this growing the a is this There some somewhere of year with It’s -- about really in is sort our bit. leading seen they’re with and I the key largest important the something and a think VendEngine opportunity little we’ve in a investing $XX IRR really help alliance, that just at probably and that becoming growth Public time. VendEngine core in Arx plus partnered our product I for deals. we the million white increasingly leader in Communities enough lead the really I over corrections to the Connected Vision revenue talked base, have of will is opportunity. but that Tyler We it crossover been sell all think XX% it’s market and and do is didn’t few courts I us and will to that client our and of requirements for

customer about and some, greatest a we good playbook, the them, our that asset again think we’re back is the it’s portfolio, our worked have, with through our law almost enforcement pretty I product, similar was growth. focus the we really the and a time, portfolio, in So round had can the before mentioned, fit about -- and really as more it with you Similarly out we mean about all bit base. talked something I cultural existing and like say reform and will of push on solutions that hole into a that our we deal. selling our there Arx, little excited base more them I bit really like drive

Jonathan Ho

give us have of to deals. Got on -- of multiproduct been incremental you And maybe your a better sense these can uplifting some products sale how understand how that it. point,

examples Thank we more What base did the in think multiproduct I a cited, into cross-sell as or you. time, should multiproduct on new think well mentioned of you maybe opportunities. the number of that as rates ability terms over about to expansion sales? net the you

Brian Miller

Yeah.

deals. solutions these sold it seeing some are deals we’re all we of across being core are our actually talk -- really product bit of are quite tuck-in and Those a that smaller lines. our You across about are now

becoming like talked a about You or differentiator you Safety & for that for talk five where years Socrata years, about core But the deals us sell years, also us last were We’ve Data are probably product it Public look at all in acquisitions Insight things we and records. also lines. our But These many products three example. heard cat mentioned either and and so. core SoftCode Mobility Brazos, Mobilized. or -- we done is across includes Data four through

who and side, part is in and more a we the much on competitive of strategy set sort that an makes enterprise it suite things needs. as we to our solutions have it the attendance the fit have such of it against us seen of space it diverse see of solutions You as like compete overall a range wider management. don’t We’ve ExecuTime, enterprise people client time and court and

Jonathan Ho

you. Thank Great.

Operator

Peter Davidson. Please from D.A. comes The next go question from ahead. Heckmann

Peter Heckmann

business should expect pretty to just a function been I’m also off on we like contributor? kind my some seems have other consistent older of out in continue Hey. be you’re figure Do taking of rolling part that a there. business, it. I a and Thanks for appraisal or step appreciate contracts appraisal and it big wins size the the of real change but notable appraisal there to trying call.

Lynn Moore

say it’s consistent. I’d broadly pretty

or our deals. sometimes three have We projects years, years sometimes often multiyear projects two longer. These

courts projects. are sometimes counties to taxes. we’re regular a get in Delaware of Some These when like Delaware It appraisals was to one-off. almost of the we out more state unfair that Others have by all have so that involved recurring driven Indiana start. of date in of that comprise the are Ohio reappraisal, cycles, that are and court-ordered contributing them where getting cycles like ready determined three and maybe legislated distribution certain it’s appraisal

COVID able to a now, some be really up. deals, out there’s right delayed, So say are have at -- that but pretty that’s bit be can these. coming we of where these of little the function, to right kinds may deals but with have we’re lumpy, a But business in competitive well there position strong positioned projects a those of I’d now. generally large would in range doing a And active more say, be a case step a on one-off in probably is period uniquely a I and particularly we’re big we’re been they step wouldn’t it where and

Peter Heckmann

additional we of here in the are XX getting of over the states, in your renewals that, go trying to them and is you then and And fair. the up-sell Deloitte you some business mid-sized to NIC for and a expect ability to the to actual years. of kind renewal state contracts That’s of ahead months? competitive about to more change be expiration thinking as up early Tyler the renewals just opt How their some market. certainly some start through with change and kind regard back And thinking dynamics these and Texas that about of that just Do base get Okay. the so gave you talking or you with next far appear applications? renew their into are state out as any you date and additional case

Lynn Moore

Yeah.

Oklahoma, and what is were me payments in will outperformance When -- we is see think through that we Communities you outlook and areas ahead business mentioned NIC their that this the about generated of quarter. first, reason talk is the one renewals. going actually of my for where NIC Texas products early these payments we about these part talked was about Texas I our early and wanted offerings can were I that’s early, both business I wanted -- been excitement mentioned which say, that in the Vision. of Tyler Utah pretty And go talk they states the optimistic. of -- to I I and for of they’re seeing or think -- our entity strong get future the bring combined some renewal optimism we’ll would about can the to and gives they jump think what our different and bring. forward talk NIC We’ve about market. Connected the customer in We’ve with

Peter Heckmann

hear. to have That’s for Okay. good I now. That’s Thanks. all

Operator

question-and-answer Moore back concludes I session. This would to closing any Lynn the like remarks. turn to our conference for over

Lynn Moore

and safe questions, or Brian a day if Have and and healthy Jason, to everybody. We us free for myself. hope please stay Thanks, Great. further today. good Miller contact you have you thanks joining any everybody feel

Operator

attending you conference The concluded. presentation. Thank is for now today’s

disconnect. now may You

Tyler (TYL) 28 Oct 212021 Q3 Earnings call transcript