i3 Verticals Reports 6.2% Revenue Growth to $57.5 Million in Q1 2026

i3 Verticals, Inc. reported a revenue increase of 6.2% for the three months ended March 31, 2026, reaching $57.5 million compared to $54.1 million in the same period last year. For the six months ended March 31, 2026, revenue rose 3.6% to $110.2 million from $106.4 million. The growth was primarily driven by an increase in recurring revenues, which rose by $4.8 million, although this was partially offset by a decrease in non-recurring revenues. The company’s net income from continuing operations for the quarter was $2.2 million, a slight decline from $2.3 million in the prior year, while net income for the six-month period decreased to $3.3 million from $5.1 million.

Operating expenses for the quarter increased by 9.6% to $53.8 million, influenced by higher costs in selling, general, and administrative expenses, which rose by 10.6% to $29.1 million. The increase in operating expenses was also attributed to a rise in depreciation and amortization costs, which grew by 10.1% to $7.7 million. Interest expenses surged by 155.8% to $1.1 million, reflecting a higher average outstanding debt balance. The company reported a provision for income taxes of $0.5 million for the quarter, down from $2.9 million a year earlier, resulting in an effective tax rate of 18%.

Strategically, i3 Verticals has been active in acquisitions, completing the purchase of a business in the transportation market for $60 million in cash, with additional contingent consideration of up to $20 million based on performance targets. This acquisition is part of the company's growth strategy to enhance its software solutions for public sector customers. The company also reported a significant cash outflow of $64.7 million in investing activities, primarily due to this acquisition, compared to $3.7 million in the same period last year.

As of March 31, 2026, i3 Verticals had $7.1 million in cash and cash equivalents, with an available capacity of $319 million under its 2023 Senior Secured Credit Facility. The company maintained compliance with its financial covenants, reporting a consolidated interest coverage ratio of 16.2x and a total leverage ratio of 1.2x. The company’s liquidity position is expected to support its operational needs and growth initiatives, including potential future acquisitions.

Looking ahead, i3 Verticals aims to continue expanding its market presence and enhancing its software offerings while managing operational costs. The company remains focused on its strategic priorities, including increasing recurring revenue streams and effectively integrating recent acquisitions into its operations.