Jack Henry Reports Fiscal 2026 First Quarter Deconversion Revenue Growth

Jack Henry & Associates, Inc.® (NASDAQ: JKHY) recently released its financial results for the first quarter of fiscal year 2026, concluding on September 30, 2025. The company has reported a notable deconversion revenue of $8.6 million during this period, a figure that significantly impacts its financial outlook for the year ahead.

In light of these results, Jack Henry has raised its deconversion revenue estimates to $20 million for the entire fiscal year 2026. The increase highlights the company's responsiveness to changing market conditions, stemming primarily from the acquisition activities of its clients. Deconversion revenue generally arises when a financial institution currently utilizing Jack Henry's services opts to merge with another entity, thereby terminating their existing contract with Jack Henry. As a result, the company acknowledges that this form of revenue recognition is influenced by factors beyond its operational purview.

Despite these developments, it's important to note that Jack Henry excludes deconversion revenue when reporting non-GAAP financial results for both quarterly and annual earnings. This precaution is taken to provide a clearer picture of the company's core operational performance, which focuses on delivering robust services to its clients across the financial technology landscape.

Understanding Deconversion Revenue

Deconversion revenue represents a unique aspect of financial service operations, often tied directly to the dynamics of client acquisitions and mergers in the banking sector. When one of Jack Henry's clients is absorbed by another financial institution, the resultant termination of their contract triggers the generation of deconversion revenue. Although such income plays a role in bolstering the company’s financial statements, it does not adequately reflect the sustainable income derived from ongoing services.

Jack Henry emphasizes its commitment to transparency in communicating these figures to stakeholders and interested parties. According to their communication, measures and forecasts regarding deconversion revenue are carefully articulated in filings with the Securities and Exchange Commission (SEC), notably in the Current Report on Form 8-K filed as of August 3, 2023. The company provides a comprehensive overview of the methodologies utilized for projecting these estimates, reinforcing their approach to financial accuracy.

Resilience and Future Outlook

As Jack Henry navigates the complexities inherent in the financial technology sector, the company's strategic focus remains on fostering strong client relationships and enhancing operational efficiencies. With approximately 7,400 clients, Jack Henry’s dedication to innovation is evident as it introduces modern capabilities tailored to meet the evolving needs of its customer base. The company's overarching vision revolves around user-centric solutions that simplify processes, ultimately lowering the barriers to financial health for individuals and businesses alike.

The recent increase in deconversion revenue estimates signals a proactive approach in anticipating market trends, further solidifying Jack Henry's presence as a key player in the financial technology sector. Looking ahead, stakeholders can expect the company to continue delivering impactful solutions, driving its mission to create meaningful connections between financial institutions and the communities they serve.

In conclusion, Jack Henry's first quarter announcement reflects a solid start to fiscal 2026 amidst a changing financial landscape, and its future projections inspire confidence in investors and clients alike. For further details on the company’s financial strategies and performance, please visit the official Jack Henry website at www.jackhenry.com.

About Jack Henry & Associates, Inc.

Founded nearly half a century ago, Jack Henry & Associates has become a leading provider of financial technology solutions, blending deep industry expertise with a passion for customer service. The company is publicly traded and is part of the S&P 500, underscoring its stability and growth trajectory in a competitive market.