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Get filing alertsi3 Verticals misses Q3 targets, cuts FY2026 guidance on weak non-recurring revenue
Filed August 6, 2026 · Period ending August 6, 2026 · ~1 min read
Key Changes
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high
Q3 revenue of $53.1M (+2.2% YoY) and adjusted EBITDA of $13.3M (+4.6% YoY) came in below expectations; company lowered FY2026 revenue guidance from $221–229M to $216–221M and adjusted EBITDA guidance from $61–65M to $57–60M, citing ongoing weakness in non-recurring revenue and implementation delays.
Exhibit 99.1 view on EDGAR → -
high
Annualized Recurring Revenue (ARR) grew 8.3% YoY to $174.1M, driven by the go-live of four material statewide services in the Transportation market, which management expects will help re-accelerate recurring revenue growth.
Exhibit 99.1 view on EDGAR → -
medium
Company has repurchased more than 20% of outstanding shares under buyback programs since October 2024, reflecting management's long-term confidence despite near-term operational challenges.
Exhibit 99.1 view on EDGAR → -
medium
Q3 free cash flow was$$15.2M (operating cash flow of $14.3M less $1.3M in property/equipment capex and $2.2M in capitalized software); Q3 adjusted diluted EPS from continuing operations was $0.25, up from $0.23 in the prior-year quarter.
Exhibit 99.2 view on EDGAR → -
low
Recognized a $9.9M unrealized gain on a minority equity investment in Q3, recorded in other income, following a new investment round that triggered a fair value adjustment.
Exhibit 99.2 view on EDGAR →
Summary
i3 Verticals reported Q3 FY2026 results that fell short of expectations and lowered its full-year guidance, citing persistent weakness in non-recurring revenue streams and implementation delays. Revenue of $53.1 million grew just 2.2% year-over-year, while adjusted EBITDA of $13.3 million rose 4.6%.
The company cut its FY2026 revenue outlook to $216–221 million (from $221–229 million) and adjusted EBITDA guidance to $57–60 million (from $61–65 million). The shortfall reflects ongoing challenges in non-recurring revenue, which has been a drag on growth despite solid performance in the recurring base.
The bright spot is Annualized Recurring Revenue, which grew 8.3% to $174.1 million, bolstered by the go-live of four material statewide services in the Transportation vertical. Management believes these new implementations will help re-accelerate recurring revenue growth in coming quarters. The company has also been aggressive on capital allocation, repurchasing more than 20% of its shares since October 2024—a signal of confidence in the long-term trajectory even as near-term execution stumbles. Investors should watch whether the new Transportation contracts translate into sustained ARR acceleration and whether non-recurring revenue stabilizes, as the guidance cut suggests the company is still working through operational headwinds.
Section-by-Section Diff
Event · Item 2.02 — Results of Operations and Financial Condition
i3 Verticals disclosed Q3 FY2026 financial results for the three and nine months ended June 30, 2026.
Added in current filing · verify on EDGAR →
On August 6, 2026, i3 Verticals, Inc. (the “Company”) issued a press release announcing the results of its operations for the three and nine months ended June 30, 2026.
The company disclosed its financial results for the three and nine months ended June 30, 2026, which represents its third fiscal quarter and year-to-date performance for fiscal year 2026. The specific financial metrics are contained in the press release furnished as Exhibit 99.1, which was not included in the provided filing text.
Event · Item 7.01 — Regulation FD Disclosure
i3 Verticals furnished a supplemental presentation with Q2 2026 financial information under Regulation FD.
Added in current filing · verify on EDGAR →
The Company has also prepared a supplemental presentation (the “Supplemental Presentation”) providing certain supplemental financial information for the three months ended June 30, 2026.
i3 Verticals disclosed a supplemental presentation containing financial information for the quarter ended June 30, 2026. The 8-K does not include the actual financial figures or results; it only announces that the presentation has been prepared and furnished as an exhibit. Investors should review Exhibit 99.2 for the specific financial data disclosed.
Event · Exhibit 99.1
Added in current filing · view on EDGAR →
Third quarter revenue from continuing operations1 was $53.1 million, an increase of 2.2% over the prior year's third quarter. Revenue from continuing operations1 for the nine months ended June 30, 2026, was $163.3 million, an increase of 3.2% over the prior year's first nine months.
•Third quarter net income from continuing operations1 was $5.9 million, compared to net loss from continuing operations1 of $1.0 million for the prior year's third quarter. Net income from continuing operations1 for the nine months ended June 30, 2026, was $9.2 million, compared to net income from continuing operations1 of $4.1 million in the prior year's first nine months.
•Third quarter ... adjusted EBITDA from continuing operations1,2 was $13.3 million, an increase of 4.6% over the prior year's third quarter. Adjusted EBITDA from continuing operations1,2 for the nine months ended June 30, 2026, was $43.5 million, an increase of 0.9% over the prior year's first nine months.
• ... Diluted net income per share attributable to Class A common stockholders from continuing operations1,3 was $0.19, compared to diluted net loss per share attributable to Class A common stockholders from continuing operations1,3 of $0.03 in the prior year's third quarter.
i3 Verticals reported Q3 FY2026 revenue of $53.1 million (up 2.2% year-over-year) and net income from continuing operations of $5.9 million (versus a $1.0 million loss in Q3 FY2025). Adjusted EBITDA from continuing operations was $13.3 million (up 4.6% year-over-year), and diluted EPS from continuing operations was $0.19 (versus a $0.03 loss in the prior year). Management noted results came in below expectations due to ongoing weakness in non-recurring revenue streams and implementation delays.
Added in current filing · view on EDGAR →
Previous Outlook Range | Revised Outlook Range | Fiscal year ending September 30, 2026
Revenue $ 221,000 - $ 229,000 $ 216,000 - $ 221,000
Adjusted EBITDA (non-GAAP) $ 61,000 - $ 65,000 $ 57,000 - $ 60,000
Adjusted diluted earnings per share(1) (non-GAAP) $ 1.09 - $ 1.15 $ 1.08 - $ 1.12
The company lowered its full-year FY2026 guidance. Revenue guidance was reduced from $221-229 million to $216-221 million. Adjusted EBITDA guidance was cut from $61-65 million to $57-60 million. Adjusted diluted EPS guidance was narrowed from $1.09-1.15 to $1.08-1.12. The reductions reflect the ongoing weakness in non-recurring revenue and implementation delays cited by management.
Show 1 minor / wording change
Added in current filing · view on EDGAR →
Gain on investment reflects an unrealized gain on a minority equity investment due to adjusting the carrying value of such investment to its fair value as a result of a new investment round. The Company recognized this change in fair value in other income.
The company recognized an unrealized gain on a minority equity investment, adjusting its carrying value to fair value following a new investment round. This gain was recorded in other income and contributed to the quarter's financial results.
Event · Exhibit 99.2
i3 Verticals disclosed Q3 FY2026 supplemental financial results, including revenue composition, non-GAAP metrics, and free cash flow.
Added in current filing · view on EDGAR →
Total revenue $ 53,067 $ 57,518 $ 52,671 $ 54,901 $ 51,901 $ 54,135 $ 52,221 $ 51,323 $ 46,183 Annualized Recurring Revenue “ARR”(8) $ 174,100 $ 183,480 $ 169,624 $ 165,260 $ 160,804 $ 164,452 $ 156,420 $ 151,364 $ 143,592 Year-over-year growth 8 % 12 % 8 % 9 % 12 %
For the quarter ended June 30, 2026, i3 Verticals reported total revenue of $53.067 million, up 2% year-over-year from $51.901 million in the prior-year quarter. Annualized Recurring Revenue (ARR) reached $174.100 million, representing 8% year-over-year growth from $160.804 million. The company defines ARR as annualized revenue from recurring sources including SaaS, transaction-based software, maintenance, and other recurring services, multiplied by four.
Added in current filing · view on EDGAR →
Adjusted EBITDA from continuing operations(3) $ 13,312 $ 16,589 $ 13,615 $ 14,399 $ 12,724 $ 15,841 $ 14,571 Adjusted EBITDA margin from continuing operations(3) 25 % 29 % 26 % 26 % 25 % 29 % 28 %
For the quarter ended June 30, 2026, i3 Verticals reported Adjusted EBITDA from continuing operations of $13.312 million, up 5% year-over-year from $12.724 million. Adjusted EBITDA margin was 25%, flat year-over-year. This non-GAAP metric excludes items such as equity-based compensation, acquisition intangible amortization, and non-cash changes in fair value of contingent consideration.
Added in current filing · view on EDGAR →
Adjusted diluted earnings per share from continuing operations(2) (3) $ 0.25 $ 0.32 $ 0.26 $ 0.27 $ 0.23 $ 0.29 $ 0.27
For the quarter ended June 30, 2026, i3 Verticals reported non-GAAP Adjusted diluted earnings per share from continuing operations of $0.25, compared to $0.23 in the prior-year quarter. This metric assumes a 25% effective tax rate and excludes items such as equity-based compensation, acquisition intangible amortization, and non-cash changes in fair value of contingent consideration.
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Figures/quotes linked to EDGAR · Narrative written by AI · Aug 8, 2026 · How we verify