The combination of new client wins in core and digital banking products pushed sales bookings up almost 40% year over year for Jack Henry during its fiscal third quarter that ended March 31.

The company saw 14 “competitive core takeaways” in Q3 and signed nine existing on-premises core customers to transition to Jack Henry‘s private cloud environment, Chief Executive David Foss said during today’s earnings call.

In addition, another 38 customers purchased Jack Henry’s Banno digital banking platform, but Foss did not elaborate on the number of bank and credit union users. The most recent total number of Banno financial institution clients is 597, according to the company.

The new clients and product uptake helped push Jack Henry’s sales bookings up nearly 40% compared with the same quarter for fiscal 2021.

Among Banno clients, total users for the platform are now at 7.1 million, on track for a 3x gain this year from 2.6 million users at the end of June 2020. At that time, Jack Henry reported Banno had reached 300 bank and credit union clients.

Revenue for Jack Henry’s fiscal third quarter was $478 million, a 10% increase from $434 million year over year. Net income was $85 million, up 19% from $71 million YoY. By segment, core banking saw a 12% YoY revenue increase this quarter to $151 million, while the company’s payments segment had 10% revenue growth to $178 million.

Jack Henry does not break out its tech spend, but Foss noted the company is “committed to 14% of revenue as an R&D investment that includes [our] technology modernization strategy.”

Partner integrations in beta

Late last year, the company detailed its tech modernization strategy to grow the Banno Digital Platform through open banking integrations, such as with data aggregators Yodlee, Plaid, Akoya and Mastercard’s Finicity.

“We don’t have many holes in our product portfolio,” Foss said on the call, noting that the company will continue to look to partnership integrations to build out and modernize its digital banking offerings. He said Jack Henry has integrations now in beta that will go live over the summer.

However, Jack Henry may also consider acquisitions to expand products this year, Foss added. “Most of the acquisitions we look at are things that we can connect to something we already have.”

[stock_market_widget type=”inline” template=”generic” assets=”JKHY” markup=”Shares of {name} ({symbol}) are trading at {price} ({change_pct}) as of {last_update}.” api=”yf”]

Help shape our agenda for the Bank Automation Summit by applying to join the speaker roster here. Potential speakers will be contacted and confirmed directly by the editorial team, and only qualified submissions will receive a response. 

Learn more about Bank Automation Summit Fall 2022.