Tyler Technologies Plunges On Q4 Earnings Miss, Poor 2016 Guidance

Shares of

plunged lower by more than 12 percent on Thursday after the company reported its

on Wednesday. Tyler Technologies said that it earned $0.59 per share in the fourth quarter on revenue of $158.9 million. Wall Street analysts were expecting the company to earn $0.66 per share on revenue of $151.67 million. Tyler Technologies noted that its quarterly revenue rose 24.7 percent from a year ago while organic growth was 15.3 percent. Recurring revenue from maintenance and subscriptions rose 23.7 percent from a year ago to $98.4 million and represented 61.9 percent of the total revenue. Operating income for the quarter fell 19.6 percent from a year ago to $19.8 million. The company cited $5.5 million in acquisition related expenses that impacted its income. Looking forward to fiscal 2016, Tyler Technologies guided its full year earnings per share to a range of $3.33 to $3.45 on revenue of $765 million to $780 million. Wall Street analysts were already estimating the company will earn $3.55 per share in the full fiscal year on revenue of $787.84 million. "Activity in the local government software market continues to be good, and with the inclusion of New World, our backlog at December 31 reached $845 million, a 20 percent increase from last year," said John S. Marr Jr., Tyler's president and chief executive officer. "With our strong financial position and cash flow, we plan to accelerate our investment in product development in 2016 with expected R&D expense of more than $47 million. We believe that increasing the investment in our products beyond our previously planned level will better position us to continue to expand our industry-leading position in the public sector software market over the long term."