I3 Verticals . Class A Stock Earnings Reports

i3 Verticals reported Q1 FY2026 revenue of $52.7M, up 1% year-over-year, driven by recurring revenue strength (+8%) while nonrecurring professional services and license revenues declined about $3M. Annual recurring revenue rose to $169.6M. SaaS revenue was a standout, up over 24% in the quarter and the company noted four consecutive quarters of >20% SaaS growth, which management expects to continue. Adjusted EBITDA was $13.6M (25.8% margin), down ~$1M versus prior year due to investments in Justice and Utilities, higher hosting costs, and lower professional services; management expects margins to improve through the year. The company closed a strategic acquisition on Jan 1 for $60M in cash (≈15x EBITDA) of a state-level insurance verification SaaS business growing >20% with >50% EBITDA margin—management views this as highly strategic to Transportation and expects it to meaningfully boost recurring/SaaS growth. Balance sheet: $37M cash, no debt, and a $400M revolver (5x covenant). Capital allocation remains opportunistic across M&A and share repurchases (management repurchased a significant number of shares in the quarter). FY2026 guidance (continuing ops): revenue $223M–$234M, adjusted EBITDA $61M–$66.5M, adjusted diluted EPS $1.08–$1.16. Management highlighted continued demand in JusticeTech, Transportation and Regulatory/Licensing, ongoing product investments (including AI-enabled features), and a long-term target of mid-to-high single-digit organic growth with recurring revenue accelerating.