Good morning, everyone. I'm Hala Elsherbini, Senior Director of Investor Relations, and it's my pleasure to welcome you to Tyler's 2026 Investor Day. It's so great to see so many of you here in person today. We appreciate you coming out. Thank you to those on the webcast tuning in. We have a full agenda. Lynn will kick us off in just a moment. Let's cover a few housekeeping items. First, our forward-looking statements. Today's presentation may include forward-looking statements regarding our expectations of future results and our financial performance. These statements are based on our current assumptions and are subject to risks and uncertainties that could cause actual results to differ materially. Please refer to our SEC filings for more information on these risks and other factors. Our statement here regarding our use of non-GAAP measures. Note that all financial measures in today's presentation represented here are in a non-GAAP basis, and we do have a reconciliation of non-GAAP to GAAP in the appendix of the presentation. Let's take a look at the agenda and just the flow of the day here. We have the first three presentations will focus on our key initiatives and our growth strategies. We'll follow that with a Q&A session, about 25 minutes. We'll take a short break, and then we'll dive into our AI strategy, our capital allocation, and Brian will bring us up to date on our financials and take us through our 2030 outlook. We'll have another Q&A before Lynn comes up and gives his closing remarks. Given our large audience in person today, we will not be able to take questions from the webcast. We'll be taking questions here from the in-person audience, but anybody that has a question from the live webcast, please do send those to me, and we'll follow up later this week. We'll end today with lunch, and then it'll be in the foyer, and then seating will be here. Lastly, the presentations will be available later today on our IR page on the Events and Presentations page. Now, please join me in welcoming Lynn Moore, Executive Chair, President, and CEO. Thanks, Hala, and good morning, everyone. Welcome to Tyler's Investor Day. I appreciate everyone taking the time to be here today and those on the webcast, and also really appreciate everyone's interest in Tyler. Our last Investor Day was three years ago, and a lot's happened since then. There's been a lot of execution on a number of strategic initiatives, and we're really excited today to share with you what we've been doing over the past three years. Let's go ahead and get started. I'm going to kick things off today by covering three things. First, our performance since the last Investor Day. I call that commitments made, commitments delivered. Second, I'm going to spend a little time talking about why the public sector is such a unique market and what separates Tyler from its competitors within that market. Finally, I'm going to give you an update on some of our 2030 targets. Not the whole targets. Brian's going to have those later. I know some of you all were asking earlier. You have to wait for some till the end. Okay. Let's start with the basics. Tyler is the largest company that's solely focused on providing software solutions to the public sector. We are by far and away the market leader. Last year, we did about $2.3 billion in revenues, 87% of which was recurring. The public sector is a market that's built on reputation and trust, and we have a long track record of successful implementations and delivering trust to our clients. It's why our gross retention rate is 98%. In fact, I think in the 28 years I've been at Tyler, our gross retention rate has been about 98%. As you can see on the right side of the screen, we have solutions that meet all the mission-critical needs of the public sector, whether it's financials, courts, public safety, tax, state, and federal. Whatever they need, we provide. Three years ago, at our last Investor Day, we outlined a clear strategy that would guide us to 2030. I'd like to spend a little time updating you on how we've been doing on that strategy. I'd say at a high level, I'm really pleased with our progress. Today, we're either at or ahead of my expectations that we set three years ago. Our cloud transition has been progressing well through product optimization, version consolidation, exiting our data centers. We talked about an inflection point in our financials. That happened in the fall of 2023, just as we expected. We've done eight acquisitions since the last Investor Day, expanding our offerings, including things like AI capabilities. You've heard us talk about Document Automation. Excuse me. In addition, over the last three years, we have developed and refined what I call a smart AI strategy. You're going to hear more about that today from Franklin Williams, our new Chief AI Officer. Let's take a couple of moments and take a closer look at where we are in our cloud transition. I think the takeaway here is, again, I couldn't be happier with where we are today and where we're going. Many of you have heard me say over the years that Tyler is not going through a single cloud transition. We're actually going through multiple cloud transitions. Why do I say that? I just showed you the breadth of products we have. We have a big product suite that's going through this. Different starting points, different ending points, different technologies, different client bases, different number of versions out in the field. Very complicated process we've been going through. When we talk about our cloud foundation internally, we've been talking about it in two phases. The first phase is what we've outlined at the last Investor Day, and it's really more of a foundational phase. Again, it's around the things we talked about. It was selecting AWS as our public cloud provider. It was optimizing our products to run in AWS. It was version consolidation, closing our data centers, proving out our SaaS flips and the metrics around those. That continues today, again, we are on track with those initiatives. The second phase is something that we've been working on internally for almost two years now, and we call that Cloud Living. What is Cloud Living? Cloud Living to me at the highest level is, it's really operationalizing the cloud. It's really operating like a true cloud provider with continuous improvement, continuous delivery, small regular releases that are coordinated across our entire client base, providing a more seamless experience for all of our clients. Russell Gainford, our CTO, is going to get up in a few minutes, and he's going to go into a little more detail, but it's a really exciting next phase of Tyler. It's something that I'm really looking forward to. From a strategic standpoint, as I just said, we've either been on track or ahead of track from where we thought we would be three years ago. What about the numbers? We're also either at or ahead of all the interim financial targets that we set out three years ago. If you remember, I called this section Commitments Made, Commitments Delivered, and to me, that's a hallmark of Tyler. If we say we're going to do something, we're going to do everything in our power to do it. Importantly, we're not even going to say that we're going to do something unless we believe we have a reasonable, credible path to get there. I'm really satisfied and gratified by these numbers, and particularly, I think when you look at our free cash flow margin, it's up 8- 10 points from where we thought we'd be three years ago, and we've generated a lot of cash. That's probably the thing that stands out to me on this page the most. Let's switch gears a minute and just talk generally about the state and local government market and what separates Tyler from the rest of our competitors. The state and local government market, it's a large market. Gartner estimates that it's about a $44 billion market today, but it's also a market with a long history of consistent growth. As you can see, from 2023 through today, it's been growing at about a 10% CAGR, and we expect that to continue through the rest of the decade. What is it about this market that fuels this consistent, steady growth? To me, it's a different market. It's structurally different than what happens in the private sector, and it's different in meaningful ways. On the left side of the chart, you see some of those differentiators. The public sector market is still really absorbed with old antiquated systems, homegrown systems that are reaching end of life, systems where other vendors are no longer supporting them. There's an ongoing workforce shortage in the public sector. Labor is shrinking, retirements are happening, and it's not being replaced with younger workers. Expectations of citizens continue to rise. People expect to interact with their government the way they interact with technology in every other parts of their lives. It's putting more and more pressure on local government to keep up. Obviously, cybersecurity, regulatory mandates, AI, all of these things contribute to one thing. At the end of the day, the governments must modernize. They have no choice. What does that mean for our prospects for future growth? Today, Tyler has over 50,000 systems located across more than 16,000 client locations. The answer there is we still have a very long runway ahead. From a system standpoint, we have about an 11% market share. Again, a really long runway ahead. Let's talk about why Tyler's been so successful. What differentiates us in this market? Why will we continue to capture an increasing share of this growing market? There's five unique things that separates Tyler from all our competitors, and importantly, there's no other company out there that can list all five of these strengths. Let's take a look at each one. First is our portfolio of products. We have the broadest, most integrated set of public sector solutions in the market. As I mentioned earlier, we touch all the mission-critical needs of the public sector, whether it's in public admin or schools or courts, public safety, state and federal. There may be competitors who compete in one of these lanes, but more likely just a piece of one of these lanes. No one has the broad set of solutions that covers the entire mission-critical needs of the public sector. In addition, we can play at any level. We can play from the largest cities, largest counties, to the smallest. We can play from state agencies to local agencies, from school districts to special districts. Again, whatever the public sector needs, Tyler has a solution. That takes me to our second differentiator, our singular focus and deep domain expertise. The public sector is all we do, and we've been doing it for decades. We understand this market. About 45% of our team members have worked in the public sector. What you see here on this slide are things that differentiate us from our competitors, whether they're local, regional niche players, someone who may have a single product or someone who just plays in a certain geography, or a more large, multi-focused national player, someone who plays in the public sector, but also in the private sector. Only Tyler can provide the full end-to-end suite of integrated products that are purposely built for the public sector. Excuse me. Our third strength is our large client base. We have the largest client base of any vendor out there. Again, more than 50,000 installations, over 16,000 client locations. Nobody can match that. Many of you in this room have heard me say that our client base is our greatest asset. Why do I say that? Because in this market, a client base like that doesn't take years to develop. It takes decades to develop. Only Tyler has decades of proven results and trust within the public sector. What that does is it creates a significant opportunity. You can see here on this slide that our average client has about three Tyler products. Yet we believe with our current portfolio, that can grow to 8- 10. That actually can grow even more as we continue to do more and more innovative R&D, and more and more M&A. Speaking of R&D, that's our fourth differentiator. We have a long history of innovation that's tailor-made for the public sector. Again, 45% of our people have worked in the public sector. We know what they need. We have over 2,800 engineers who wake up every day, come to work focused on creating new products or increasing the competitiveness of our existing products, and doing things like AI to do those. As you can see on the right side, our R&D has increased about three and a half times over the last eight years, and all of it is for the purpose of two things, growing our revenue and increasing our moat. Our fifth differentiator is M&A. We've been an active strategic acquirer in the public sector since the beginning. Three years ago, at the last Investor Day, I used the phrase, I think for the first time, that M&A is part of our DNA. It is. We've done over 60 acquisitions in the last 28 years that I've been at Tyler. What are the things we look for in an acquisition? If you look on the right side of the slide, we look for voids or gaps in our offerings, new capabilities, new technologies, things like AI. We look to expand our TAM. We look to add clients to our base so we can do more cross-sells, more up-sells. One of the things that we really focus on is can we bring something in, leverage the Tyler machine, and get it to grow at a rate that's faster than Tyler's overall growth rate? Pulling all this together, Tyler is dominant in this market because we have five strengths that are difficult to replicate. They can't be created overnight. They can't be spun up in a lab. The public sector is a business that's grounded in trust and reputation, something that takes decades to establish. It's what makes Tyler unique, and it's what makes us well-positioned to continue to capture an increasing share of a large and growing market. I talked about our 2025 commitments. I've talked about the public sector market, why it grows, why it's unique, why Tyler is uniquely positioned. Let's turn a little and say, what does this mean as we look ahead? What's our go-forward strategy, and what results do we expect? When I think of Tyler, I think of one word, consistency. Consistency in strategy, consistency in values, consistency in execution. Yet at the same time, we're also nimble and agile enough to adjust to changing market conditions, changing technologies like AI. What you see here is our four-pillar growth strategy that we outlined at the last Investor Day, leveraging our installed base, expanding our TAM, completing our cloud transition, driving transactions growth. Same strategy. You also see we've made some adjustments. We've woven AI into each of these growth pillars, and we're going to do a deep dive later on AI and how it does affect those growth pillars. As for our goals, those also remain the same. We're going to continue to grow ARR, continue to improve margins to drive expanded free cash flow. Three years ago, we outlined a strategic vision with what I think were really bold seven-year financial targets, including $1 billion in free cash flow. I remember standing on stage saying, "$1 billion in free cash flow." That was incredible to me for someone who's been around when the company did $25 million in revenues to think about $1 billion in free cash flow. Over the last three years, we've been building a more and more valuable company. Quarter- after- quarter, year- after- year, our ARR continues to grow and our free cash flow continues to grow. We've been executing on our strategy and we've been laying the foundation for more scalable growth. You're going to hear about some of that today. Based on that, we're raising two key 2030 targets, ARR and free cash flow. In 2023, we projected our 2030 ARR would be $3.2 billion-$3.4 billion. Today, we're forecasting the high end of that range between $3.3 billion and $3.4 billion. Also in 2023, we projected free cash flow to be $1 billion. Today, we expect it to be $1.1 billion-$1.2 billion, likely at the higher end of that range, or 15%-20% higher than what we said three years ago. How are we going to measure success going forward? Well, it's the path to reaching those two goals. We get there by growing ARR at 10%-12% a year and increasing free cash flow margin to the low 30s. These are our anchors. These are what you should look to when determining our progress towards our goals. In summary, Tyler today is stronger than what it was three years ago. We have clear long-term strategic initiatives. We have alignment across our executive team. We've been executing on those initiatives. Today I can stand here and say that we are at or ahead of what my expectations were three years ago. Because of that, and this is something I say all the time inside of Tyler, I can stand up here and say I've never been more confident in Tyler's future than I am today. Okay, let's talk about the rest of the day. Hala covered this a little bit. Russell Gainford, our Chief Technology Officer, is going to come up and talk about where we are in our cloud transition, go a little bit deeper into Cloud Living. Again, an initiative that I'm really excited about. Liz Thomas, President of our State & Federal Group, is going to come up and talk about transactions, how they're differentiated. I think it's part of our business that's still not fully understood by investors, and I think you're going to get a lot of clarity on that today. Franklin Williams, our newly minted Chief AI Officer, is going to come up and talk about AI and why we believe it makes Tyler a stronger company in the future. I'm going to jump back up and talk about capital allocation. I know you all have a lot of questions for me over the years over capital allocation. Bruce is smiling. We're going to wrap it up. Brian Miller's going to come up with a financial update, and he's going to give a more in-depth look at our 2030 outlook. With that, I'm going to turn it over to Russell Gainford, our Chief Technology Officer. Thanks, Lynn. Yeah. All right. Good morning, everyone. My name is Russell Gainford. I serve as Chief Technology Officer here at Tyler. I've been with the organization for eight years. Prior to that, in total, I've been in the GovTech industry about 26 years, helping those who serve the public. Today we're going to talk a little bit about reiterating our strategy, what we talked about in 2023, what are our ultimate goals. We're going to go into our how are we actually delivering on that strategy, what is the progress that we've made. I'm going to talk about our path to 2030, what you should expect from us from an execution perspective the next five years. Ultimately, the final piece of this is we're going to touch on the end state of our trend, our SaaS transformation, something that we call internally Cloud Living, and we're all really excited about. As a reminder, SaaS is a huge growth driver for our organization. It represents approximately $780 million, or 33%, of Tyler's 2025 revenue. We've seen a 21% CAGR over the last three years. Maintenance, which is largely on-premise licenses, represents another 19% of revenue. We have dozens of flagship products. We have hundreds of product SKUs. For the sake of simplicity, for the first phase of our cloud transformation, we broke down our execution into three key pillars that were important. The first was new clients, shifting our go-to-market to be SaaS first and ultimately SaaS only. The second was our existing hosted clients we managed for years and getting out of the private data center business. Our third pillar was our existing on-prem clients and partnering with them aggressively to move them to a SaaS arrangement. How have we done on these three pillars since we last met? For net new clients and leading the public sector market to a better destination, in 2019, about 50% of our total contract value was signed in a SaaS arrangement. In 2023, that number increased to 86%, and today, over 95% of our total contract value is signed in a SaaS arrangement. Those clients now go straight into AWS. We still have some small modules and occasional on-prem deal that takes place, but you'll see those continue to diminish. That's our first pillar, new clients. Our second pillar was the existing clients that we had ultimately moving to a point where we're moving out of the private data center business. We've historically had two primary data centers in the organization. One was in Dallas, Texas, and one was in Yarmouth, Maine. The goal of this project was to move 5,000 live customers out into AWS and ultimately realize the lower capital and operating costs associated with those locations. This chart shows you here where those customers were located, how many of each when we started the project in 2021, and where they are today. We're proud to announce that we completed both of those projects on time, on budget, with the last of our customers in our Maine data center moving out at the end of last year. We're already seeing margin uplift as a result of this. Now let's turn to the final pillar. The final pillar is migrating, or a term you'll hear me use a lot, flips of existing customers from on-prem into the cloud. When we started and went cloud-first, about $500 million of maintenance is what we had to convert. Flipping a client involves multiple steps, partnership, readiness assessments, signing a new SaaS agreement, working with their IT team, and moving the data and their business processes over to the cloud. Today, we've retired about 30% of the maintenance revenue that we began with, we're on track to hit our target of converting 85% of that by the end of the decade. I'll show you in more detail what we expect that to look like shortly. In summary, we are on track with all three pillars of our cloud execution, where almost all new deals are in SaaS arrangements. We closed our data centers on time and on budget, we're happy with the conversion progress and the foundation we've made to date. You'll see us introduce additional incentives to entice more customers that are on-prem to move to the cloud shortly. Those are the results. However, I want to touch for a moment, as we went through and executed on those results, we built a foundation of operational efficiency, scale, muscle that is allowing us to drive towards our 2030 goals proactively. I want to talk about the trends we've seen and what we've actually done because I think it reaffirms our strategy and drives additional optimism in where we're going. You've heard Tyler talk many times about version consolidation. I want to spend a moment on why that is so important to us. In a legacy, historical on-prem environment where you're supporting thousands of customer environments across many software versions, it becomes incredibly complex and expensive to run. Our clients don't always get the full value of our investments as fast as we'd like them to. They can voluntarily skip individual updates. They may have constraint on IT staff. The value we're delivering can be delayed months, and in some case, it's delivered years later. Our teams have been very hard at work on using the capabilities of the cloud to consolidate many of these legacy software versions. Ultimately, partnering with our clients to drive them on a current version that provides more simplicity, our ability to keep them current, and generates additional CSAT with all the capabilities that we've invested in. You've actually asked us about version consolidation many times on what the progress of that is, and data matters. I want to show you two actual quantitative examples from two of our flagship products in our portfolio. When you look at the flagship product to the left, this is a project that started just over three years ago. They've been partnering with clients. The number of customers that were not on current versions or prior versions before, and three years later, only 7% of their clients are off a current version. Our flagship product two on the right had significantly more installations, went through a similar project, and now only 12% of their clients are off current versions. Why are we showing these? Why is this so important? When we move a customer onto the current version, when we're ready to flip them to the cloud and sign an agreement, it is significantly simpler. We've removed the consumption gap of all the capabilities that weren't being used, and now it becomes a small technical exercise. Also, when we get them in the cloud with the foundation we've created, we are keeping them current, driving a higher CSAT, and driving more cross-sell opportunities. So what? We've consolidated versions, we've executed today. What are the outcomes that we're actually seeing? The outcomes we're seeing is that clients that are now running in the AWS cloud versus prior locations are significantly happier and view us as more of a strategic long-term partner. It drives higher retention rates, and ultimately, it's driving additional cross-sell opportunities. Rather than just hear from me, let's hear from one of our actual clients who signed a software as a service agreement. What were the drivers on when they signed to move to the cloud, and what did they see on the other side? I am the IT Director and head of IT for the City of Redondo Beach. IT in the city is only eight people. I only really have one person that's more than half-time dedicated to ERP support. Our actual servers where our on-premise Tyler environment was running were pretty dated. Tyler has some of our most important information in it, Social Security numbers, payment information, banking information, and that was all running on top of old systems, and it was a real challenge for us just to keep things going. The decision for us to stick with Tyler rather than shop around for a new ERP platform was really quite easy for us. We knew the Tyler application had more features that we had yet to implement that would make it even better for us. With Tyler having the new software-as-a-service availability on the AWS platform, it was a no-brainer solution for us. There was no need to shop for anything else. From our customer standpoint, our customers are now able to use features of the application that we simply didn't have before. There is absolutely no reason that I can think of that a peer would need to be on-prem right now. It just makes sense to allow the experts that do this day in and day out for thousands of customers to be responsible for that stack of technology. I just want to point out there, that's not the exception use case. That's the pattern we're seeing. As customers get more current, they move to the cloud. These are the types of responses. Unlike the private sector, in our market, every one of these peers talk to each other, they share stories, and they tell them what their experiences were. Now let's turn to our path to 2030 and how to think about our delivery and what we'll be delivering on over the next five years. With that foundation that we've created, the client conversion progress, and success that we've seen, we see a meaningful growth opportunity and a visible ARR tailwind that will take us through 2030. When you look at our 2025 recurring software revenue mix, on-prem ARR or maintenance in our balance sheet is about 22% of the total revenue. SaaS is about 78%. We still have about $400 million in maintenance left to convert. Note that that maintenance balance changes over time, both in positives and rising and negatives. We have yearly rate increases. Customers add additional modules that are on-prem today, the rare on-prem deal. Ultimately, you'll see that continuing to come down as we go through flips. When you ask us about progress, I do want to call out that the metric that we use is the% of maintenance dollars converted that we've done to date. Because we have so many products and portfolios and suites, and we have some customers that pay us a few thousand in maintenance and some that pay us millions. Measuring by maintenance dollars converted makes the most sense for us as an organization. When we convert, flip, and migrate a customer to the cloud, on average, the ARR revenue from the maintenance moved to a SaaS agreement increases about 1.7x. This is a consistent model. We've reiterated it, and we continue to see it across our portfolio of solutions. This does not include any other cross-sells that go along with that, modules, department expansion, that they're on a current version, payments and transactions. That's just the uplift rate from on-prem maintenance to the SaaS agreement. We expect to have 85% of that maintenance converted by 2030. Over the next five years, you should expect us to introduce quite a few more incentives for our on-prem clients to move to the cloud. The existing incentives still remain, and we still see a lot of traction, performance, reliability, the CSAT response from your peers. I'm also noticing, I'm talking about Cloud Living shortly and the benefits that that's going to provide. That will be a huge incentive. We're also introducing new features and capabilities, including AI, that will only be available in the cloud version. As we continue to see the pool of on-prem customers shrink, you will also expect to see disincentives from us for customers who remain in that world. With the progress that we've made, the incentives we just talked about, we see a meaningful growth in our flips from where we are today in 2026 through 2029, ultimately leading to us hitting our 85% maintenance conversion by the end of the decade. Brian Miller will be up shortly, and he'll talk to you about what that looks like in our 2030 financials. Okay. Now let's talk about unlocking the full value of the SaaS model, because this is what really matters. I want you to think about our cloud transformation into three distinct states. Where Tyler came from, our initial state, expensive, complex, many software versions, often characterized by undifferentiated heavy lifting. The last three years, we've been moving to this intermediate state, optimizing products for AWS, converting our customers and creating automation, moving customers off of legacy software versions. We've built the foundation with that to take us to 2030, but more importantly, it now allows us to focus on the investments for the end state and what the future is. In parallel to building that foundation, we were working as a leadership team with our staff across the company and saying, "What is the best end state for Tyler in SaaS across our organization? What provides the most value to Tyler, our clients, and our shareholders?" We call this initiative Cloud Living, and it's a bold vision for the future. We began rallying our organization around this at the end of 2024. We've been executing on it now since then, and we will have our initial rollouts with pilot customers coming in 2027. Let me drill in a little more to Cloud Living and the heartbeat of value that it will provide to our clients in the market. Cloud Living centers, when you break down the term, into four key priorities that are critical to our success. Every growth product at Tyler today and every operational team that works on those products is investing in all four of these priorities for delivery because they will deliver the most long-term value. When we complete all four of these priorities, we expect additional new revenue and opportunities, more operational efficiency, and ultimately, increased profits. I'm going to go through each of these quickly in detail. Our number one and most foundational priority to Cloud Living is finishing our version consolidation journey. It will ultimately improve our scale and lower our cost to serve. We are cutting the cord with Cloud Living of our history of multiple version support and moving to one SaaS version for all customers on one cloud platform. All Cloud Living clients will receive a single, continuously updated biweekly set of features and capabilities on a unified cloud platform. This is incredibly transformative for us. It's going to dramatically reduce our operating costs, the complexity supporting our clients, and our innovation is going to be delivered so much faster than in this prior model. Our second priority is moving to a standardized SaaS model that will enable our most critical operations. This right here is all about how much value can we provide to our clients and how quickly, time to value. In addition, this model will provide a consistent, seamless client experience, whether a Tyler customer has three products or whether they had 10 products. Historically, every Tyler business unit and product made their own release schedules and maintenance windows and managed them what was best for that individual deployment schedule, which worked well, but as clients buy more products, it creates a point of friction. All of that is removed in Cloud Living. Every solution will operate on the same schedule. There will be an automated delivery framework. In practical terms, I want you to think of a Tyler agency client. Their staff will leave on a Wednesday, and they will come back on a Thursday morning with every Tyler solution they own updated with the latest capabilities, performance enhancements, maintenance updates, and security capabilities, all seamless to them, all non-disruptive. We've already been piloting this. We started rolling out with some customers to say, "What does this model provide compared to the prior model?" You can see the results on the right. Customers using this automated model are now receiving value 15 times faster than the prior model. We're already seeing the proof. Our third key priority of the four is that with the stronger partnership and value that we're delivering, we will drive additional cross-sell and higher retention rates. Clients get greater value on the platform, they will expand into other departments, and they are happy to give Tyler a percentage of that value. This is an example from an actual customer use case. This customer was on-prem for many years and paid us $950K in ARR. We took them to the cloud in the current version, they saw the new capabilities and started expanding the department use that they had, rallying internally of how this could streamline their data processes and prove the way that they operate. Ultimately, with that expansion, they then decided to do another purchase of cross-sell product to improve their inspections maturity. This client got significantly more value from the platform, and Tyler got 142% ARR increase as part of it. When Lynn shows you the slide of our opportunity of going 3- 10 products, this is the priority that gets us there. Our final priority is using this strong SaaS platform that we've created to increase our win rates. We build and deliver more value, as we get this expansion, we will generate the engine of the most powerful asset that you can have in public sector technology, customer advocacy. This leads to increased client references, department expansion, and additional net new revenue opportunities. Lynn showed you the slide on our TAM, 11% penetration. This is the driver that makes that roadway wider and allows us to fill up more of it. More penetration in the market. As we deliver on these four key priorities, the outcome is clear with our Cloud Living investments. Tyler will provide the most broadest and deepest integrated and seamless SaaS suite of software solutions for the public sector. As an analogy, I want you to think about the Apple ecosystem that many of you use today, or Microsoft 365. Every new product and capability added to the platform provides more value, and it expands the moat. The only difference here is that Tyler is the only vendor with a deep focus on the public sector industry and the breadth of portfolio and capabilities to make this vision and ecosystem a reality. In summary, our cloud transformation progress is becoming a powerful growth engine for our organization. We remain on track with all of our conversion targets, and it's positioning our organization for higher recurring revenue as we look forward. Cloud Living, which is ultimately our end state, is already targeted to begin early pilot launches in 2027, and it's going to provide greater operational efficiency and long-term shareholder value for the organization. Thank you. I'm now going to hand it off to Liz Thomas, who's going to talk about our transaction business. Thank you. All right. Thank you. As Russell mentioned, my name is Liz Thomas, and I am the President of Tyler State and Federal, and I've been serving these important markets for the last 15 years. I could not be more excited to be up here on the stage today to talk to you about transactions, because not only are they an engine that drives the State and Federal markets, but I am passionate about growing Tyler Transactions across all of our divisions with my friend, Ryan O'Connor, our new Chief Transactions Officer. Unfortunately, Ryan was not able to be here with us today as he had a last-minute illness, but we look forward to introducing you to him in the future. To set the stage, Tyler Transactions represent over one-third of Tyler total revenue and growing. Tyler Transactions will continue to meaningfully contribute to Tyler's diversified revenue portfolio, as well as those free cash flow targets you just heard about. As Lynn mentioned, as important as this revenue stream is, it is also often one of our most misunderstood revenue streams because we use terms like payments and transactions interchangeably. Today, I'm going to spend some time level setting with you what we mean when we say transactions to set that foundation, and then we're going to pivot to the key growth drivers that will take us to our 2030 targets. Let's start with that foundation. There is power in Tyler's diverse transaction portfolio that goes well beyond monetizing payments. We think of this portfolio in three parts. The first being transaction-funded software solutions. An illustration of this is our California State Parks reservation solution, that also happens to be the largest single contract in Tyler history. At the heart, this is just a SaaS software solution to provide reservations that we can flexibly fund through transactions or a fixed subscription fee, or a combination of both. In the California example, it's 100% funded by users of the system and not state-appropriated dollars. Another feature is you won't see these transaction contracts in our bookings targets, as the implementation cycles can be lengthy and often both the volume and the timing of revenue are subject to variability, but they represent meaningful growth. The margin profile also mirrors that of any other SaaS solution, but with upside as adoption increases. The next bucket is our premium payment solutions, an example of which is our Enterprise Payment Portal that we delivered to Riverside County. These are solutions that really wrap around our payment ecosystem, that transaction that comes in or out of government. They facilitate the transaction and add value to our clients. In the case of Riverside County, we're delivering the city or the county a centralized revenue management system. Of course, finally, we offer that secure modern payment platform that's fully embedded with our software products that allows us to create a seamless payment into government or from government to the constituents. If you take away one thing for today, I hope that you take away that Tyler Transactions is a powerful, diverse portfolio that goes well beyond monetizing payment authorization. We set goals for transactions in 2023, just like all of the goals Lynn talked about, we have met or exceeded every one of them. Our transaction growth has grown double digits, and this growth has been diversified across higher transaction volumes, higher attach rates, and expansion of that transaction-funded portfolio. Let me give you some examples of that portfolio expansion. We've developed multiple new solutions over the last five years, each one with a focus on innovation and better outcomes for our clients. As you can see from the metrics on this slide, every one of these solutions carries its own unique value proposition for our client, but they have one common theme, and that's a direct correlation between product adoption, Tyler revenue growth, and client satisfaction and return. Tyler's demonstrated ability to deliver software solutions to the public sector market, combined with that demand Lynn talked about for solutions that improve efficiency and enhance that resident experience, are what is going to continue to power this portfolio expansion. Not only is our product portfolio diverse, it's difficult to replicate. We have competitors that can offer one or a few similar capabilities, but only Tyler offers that full transaction ecosystem, allowing for a deeply embedded end-to-end interaction with government that creates both a competitive advantage for new sales, as well as stickiness within our existing customer base. Let me give you an example of the power of the Tyler portfolio in action, allowing us to create a classic land and expand strategy within a large state enterprise client. We started this journey back in 2009 with our front-end portal solutions. We built relationships and became a trusted partner for the state. Over the next four years, we not only expanded those payment offerings, but we were able to add new Tyler products, each one of them generating incremental transaction or SaaS revenue, doubling the client ARR. Nearly all of these solutions also have additional upside as adoption increases without us adding a single new product to this portfolio. That's the power of Tyler Transactions, and this is just an example. This opportunity exists across multiple clients and markets. Just as Russell said, we don't want you to only hear about this from us. We want you to hear directly from our clients the value they find in the Tyler transaction ecosystem and the deep integration that we've created. We had EERP, we had EPL, we had Tyler Cashiering, and we had the Customer Self-Service piece. Why not implement that and make it a smooth process across all levels by using Tyler Payments? We like working with Tyler Technologies, frankly, and the Tyler Payments option made the most sense for us because of the streamlined integration that provided between our various payment portals, whether it's point-of-sale with cashiering or online with Resident Access or Utility Access. The integration is just fantastic, whereas if we had decided to go with one of the other credit card processors, it would've been more work for our end users just for reconciliation and yeah. Tyler Payments was the way to go. It was a no-brainer for us to choose Tyler Payments. When we learned that Tyler was coming out with AP Automation, we reached out to Tyler to say, "Hey, we want to be part of this." The vendors appreciate it much more than our once-a-month payment style that we had before. The product itself was built to save time and energy, and it definitely does that. What you just heard, that's the Tyler difference. We've talked about those differentiators. I want to pivot now to how we're going to turn that opportunity into revenue. Before we do, just one quick second to remind you, I was talking to someone this morning about how significant this market opportunity is. With over $10 billion in serviceable market just for our existing transaction portfolio, including significant remaining room to attach payments within our install base, we have meaningful runway for growth. In 2023, we set those targets for double-digit growth, and we have three clear growth drivers in motion to achieve those targets. The first of those growth drivers is increasing the attach rate from the mid-20s to over 40% by the end of the decade. Why are we confident in our ability to do that? Because of the demonstrated results we've seen from our inside sales team over the past three years and, of course, that significant remaining opportunity I just showed you. Let me give you a real-life example of how attach rates allowed us to double a client ARR for a large California county. You can see on the left, we started with just two Tyler products, one of them that had attached payments. As Tyler's transaction portfolio grew and product portfolio, we were able to not only add embedded payments, but bring in that Enterprise Payment Portal that I mentioned, doubling our client ARR, but also creating significant value for the county through this single unified payments layer that brought together revenue reconciliation and management for not just Tyler products, but non-Tyler products as well. Our second growth driver is continuing to expand that portfolio of transaction products so that we can expand the TAM. The success of this expansion is really best demonstrated by the 20% growth rate we've seen from the new products we've introduced or scaled since 2023, that's grown nearly twice the rate of our core portfolio. At Tyler, we are uniquely positioned to deliver this innovation because, as Lynn said, we wake up every day thinking about how to solve the specific problems of the public sector. We're also able to often introduce this innovation in the form of products or modules that sit adjacent to or expand the functionality of an offering that we already have. As is the case of earned wage access, which sits as a module that attaches to our ERP payroll offering, or our AI-powered Resident Assistant that can be delivered as an amplifier to nearly any Tyler product. These new products are in the early innings, but they all solve a problem for our clients, have a clear trajectory for growth, and they carry that common theme of a transaction-funded product, which is the direct correlation between product adoption, Tyler revenue growth, and increased client satisfaction. Let's talk about adoption, our third growth driver. You've heard me say it now repeatedly, adoption is a unique factor of a transaction-funded solution. It also happens to be a specific discipline within Tyler. As we partner with our clients and their constituents to increase the usage of our solutions, we've seen per-client revenue grow 10% or more in many cases. These adoption strategies come in many forms. Some you might think of education and awareness, but also in the form of the implementation of our AI-powered Resident Assistant that better connects constituents to online services. An example in action of that AI power is the workflows that we're enabling in our Outdoor Reservation Solution that presents all the adjacent offerings within a park to a user as they're making a reservation. This not only expands our value, it expands value to the agency as well. With adoption, not only does Tyler's revenue grow, but clients see measurable benefits in the terms of reduced manual workflow, backlog, wait time, and that superior resident experience that drives client sat and retention. To summarize, it's these three clear growth drivers, attachment, portfolio expansion, and adoption, that make us so confident in our ability to achieve those 2030 revenue goals. Take away from my presentation that the Tyler transaction portfolio is a powerful mix of transaction-funded software and payment solutions that continues to grow. There is no one else like Tyler that can offer that deeply embedded, seamless constituent experience that goes all the way from the user to the agency system of record, to the flow of funds to and from government. That's only going to get better as we harness the power of AI within these solutions. That's the Tyler difference. With that, I'm going to transition to Hala as we open up our first Q&A session. Great. Thank you, everybody. Okay, I'm going to invite Lynn and Russell back to the stage and also ask our COO, Jeff Puckett, and Brian Miller, our CFO, to join us as well for this Q&A session. As a reminder, we'll be taking questions from the in-person audience here. We've got two, or actually maybe three floating mics. When you raise your hand, I'll call on you, and then please do state your name and affiliation. Let's keep the questions to our presentations from this morning, and then detailed financial questions to the second Q&A session. Okay. I saw Jonathan, and then we'll go to Matt after Jonathan. Thank you. Jonathan Ho from William Blair. Thank you so much for the presentation today. This has been really helpful. One thing I wanted to understand a little bit better, Lynn, is when we think about this cloud transition and the ability to convert your customers more, how do you think about the decision to apply more of the carrot-based approach versus the stick-based approach when it comes to encouraging these slips to take place? Thank you. Yeah, Jonathan, that's a good question. I think over the last several years, we've been really applying the carrot approach, and part of the reason for that is we've been needing to build the foundation and do the things that Russell talked about, getting our clients on the more current versions, so that we can get to a position where we can do that more seamlessly. As we look forward, I think you're going to see more and more of the stick approach. We talked about AI features only being enabled in the cloud version. Internally, we are going to be setting standards for our clients to where, by a certain date in the near future, we're going to ask them to have a plan in place to move to the cloud. The date for that plan to be in place is likely early 2028, with the actual plan to be executed through 2030, with some exceptions for a couple of years later. One last thing. When we were at Connect this past year, we had a client advisory board, and we talked a lot about flips. What I'm hearing more and more from clients is interesting is they actually are looking for us in a lot of instances to start providing those sticks. They need to be able to sell it to their internal stakeholders as to why they need to make these investments and move forward as their IT staffs are starting to shrink and things like that. I think we've gotten to the point where we've built the momentum and now it's time to press the accelerator, so to speak. Matt. All right. Thank you for doing this. Matt VanVliet from Cantor. I guess when you look at the 11% market share and about three products per customer, you said the aim is to get to eight to 10 products per customer. But what additional level of call that 89% market share is really target customers you're going after today that are of the right size, maybe sophistication. How much of that grows over time? But what's the catalyst for both, I guess, getting new logos, but also getting more products in those customers today? How much of that TAM is what you're going after today? I don't know. Do we have that number, Brian, of the 500,000 that are currently addressable with our current product? No, we don't really break that out. As we've said, we address virtually all segments of the market, from very small agencies to very large state and federal governments. There is a segment at the very low end that's probably too small for Tyler for some of our solutions, and not all solutions fit at the very high end, but we would have products that address, or we would be going after the vast majority of that TAM. I think the drivers, when you talk about going from three products to 10 just within our existing client base, it's the things we've been talking about up here this morning and things we're going to talk about after the break around AI. Their improved cloud experience, understanding more how we can bring transaction value and unify those solutions within those jurisdictions. It's our great sales team that continues to cross-sell and upsell. When I talked about eight to 10, don't forget, I actually think that number is going to be higher as we continue to innovate, we continue to do more M&A just within our existing client base, but we will also continue to get new logos, new flags along the way. Another good way to think about it is the opportunity is both horizontal and vertical. As we add more products, and we do a good job for those customers, a lot of the processes that they undertake actually span multiple offices and multiple products. You have the opportunity to land in one area and then stay in the same process zone and expand to other solutions. There's also a vertical expansion on top of that. Once you have those core solutions in place, you can layer transactions on top of that. You can layer AI on top of that. It's a much broader expansion opportunity than just adding additional solutions. Just one more point on that. When we talk about the going from three to eight to 10, that's really talking about a suite of products, or think of as an office or an agency within a city or a county. There are multiple cross-sell and upsell opportunities within each of those three products that we already have. Selling more modules, as Jeff said, selling more horizontal things on top of them. There are cross-sell and upsell opportunities within that existing base, and then expanding into other offices. Bella. We can go to Rob. Hi. Bella Camaj on Alexei Gogolev's team at JP Morgan. Thank you so much for the presentation today. As you think about really getting to those eight to 10 products per customer, would you say the adoption would require a significant sales step-up or any increased sales investment? Really breaking that down by customer segment or customer type, which do you know are most receptive to cross-sell adoption versus others? You asked a lot of questions there. Let me see if I can replay them all. I would say it doesn't necessarily apply to a particular segment of our business. It's active across all segments. As it relates to sales staff, sales investments, our inside sales has been a strong growth engine for us for many years. At the same time, as we look out over the next few years, one of the things we've been talking about significantly inside of Tyler is revamping how we look at sales generally, how we go to market, adding new salespeople, changing territories, changing comp plans. We're taking a real hard look at that in 2026 so that we can also help to continue to drive this revenue growth in our 2030 goals. Got it. Thank you. Rob, over here. Thank you. Good morning. Rob Oliver with Baird. Thanks so much for hosting us today. Appreciate it. My question is for Liz. On the transaction-funded software solution opportunity, which is clearly a really big opportunity for you guys and one that you guys brought to Tyler Technologies and is growing and obviously very large contracts, and appreciate some of the clarity because I think it's a little bit misunderstood by some investors in terms of how it flows through the financials and stuff. When you look at those transaction-funded opportunities, give us a sense for what's still out there. I think we know some of the ones that you guys have today, what's still available to you guys out there to get that's transaction-funded? I think we understand Parks, we understand DMV, what's still available for you within that TAM? Yeah. You touched on some big ones. When you think about our regulatory market too, I sometimes joke regulatory is the entire business of government, right? We provide regulatory solutions, and that might be someone applying for an occupational licensing or going through a real estate board. Those solutions, that's a suite of products that we have that we actually see often flexibly funded. Some states choose to apply transaction fees, and some of our larger transaction contracts come from that regulatory market. They might have a hybrid of both, where there is a, depending on whether we believe the volume will be there for that particular board, we have the flexibility to have a minimum SaaS amount plus transaction-funded arrangement beyond that. I think that's where we see opportunity. Really, most of the things that you do for government, it's typically some type of transaction and payment coming into government. We see a lot of opportunity to fund those solutions through transaction fees. It really just depends sometimes on state preference, or whether that solution or that market is familiar with a transaction-funded approach. I might add, Rob, I know it's intuitive, but we get a lot of questions about the macro environment and budgets. When you think about a transaction-funded software solution, it takes it right out of it. Our largest contract ever was in a state of California parks example, and we all know what the budget issues are in California, and yet it's our largest contract ever, and it's funded through transactions. Yep. I think we have Is that Allan over here? Then we'll go to Keith over here. Hey there, Allan Verkhovski with BTIG. Thanks for taking the question. It's great to see the 2030 targets moving higher, I think your market leadership is clear. I want to ask about Anthropic and others, which are now actively marketing Claude Code and similar agentic coding tools directly to state and local governments with documented productivity claims. How do you think about how your install base is positioned against a government IT team that can increasingly build and maintain custom applications without a vendor in the context of wanting to drive more cross-selling? How has AI generally been impacting your sales cycles? Thanks. I think we're going to cover some of this after the break. Franklin's going to go into that and some of our differentiators. Just not to leave the question hanging for 30 minutes. I think when I think about the conversations we have with our clients, you heard me talk earlier about trust. That's something that's really important to them. When you talk about the data, the data is running through our systems. Even you saw in one of those videos, they talk about the importance of the data and the type of the data. What our clients are telling us is they're not going to let outside third parties get access to that data. We also talked about how the market moves slower in the public sector, one of our advantages we have there is distribution. When, as we are able to spin up things quickly, we can get it out into hands a lot quicker. Again, Franklin's going to go into a little bit more after this break, but I would say that's a quick 50,000-foot view. Keith? Good morning. Keith Housum from Northcoast Research. Once again, Hala, thank you very much for putting on the program today. Talking in terms of the adoption of products within your customer base and acquisitions, very acquisitive over the past two decades, whatever it is. Maybe just taking it down to a little bit more level of detail in terms of talking about specific acquisitions, in terms of how you guys have been able to Tylerize them and make them a part of the overall portfolio and expand the amount of customers that you've been able to apply to their products they've brought in. We always speak at this 30,000-foot level. Maybe to the extent you can bring it down to the 10,000-foot level and give specific examples of how you guys have taken these acquisitions and really have made them part of the Tyler Group and expanded your presence within their customer base. It's a good question, and I hate to keep deferring, but I actually have a specific slide on that when we get to capital allocation, where I'm going to have an example of what we've done in the last three years. I'll give you another example. We talked about it at the 2023 Investor Day, our CaseloadPRO, which is our Enterprise Supervision product. That's a company that we brought in, and today it's, I think the revenue is 7x what it was when we brought it in today in 20s - late 20-teens. 18. We'll cover that in the capital allocation section. It's a good question and one a lot of people here have asked. Arsenije, then Connor. Hi, thanks for taking the question, Arsenije from Alex Zukin's team at Wolfe. I think last year we were talking about how there were some internal changes and focuses on de-siloing some of the sales force and go-to-market functions that we were talking about last year. I guess first, how has traction been there? How has that trended? As a second part, when we're looking at the targets for that flip ARR, that conversion ARR increasing after this year, how much of that increased confidence in that level of conversion ARR is coming from more confidence in your internal sales force and a better go-to-market function versus a better path for that version consolidation on cloud products that you guys have been planning out as well? I'll start, Russell, you can jump in. I would say, in my opinion, the second question is more the latter. It's more of what we've done internally. When you talk generally about the sales organization and breaking down silos, as I just mentioned, we're continuing to look at that across all. Many of you have heard me use the phrase for a couple of years now, One Tyler. What does One Tyler mean? One Tyler spans all different types of operations across Tyler and up and down Tyler. I think probably one of the best examples of One Tyler in action is what we're about to do with Cloud Living, to where all of our clients, regardless of which product they have and which business unit services that product, is going to get the same experience, the same releases, in a regular cadence regardless. That's something that's never happened before at Tyler. Russell, I don't know if you have any more. I'd add, another level of confidence is you can sell something, but the scale of our customers being ready for it. When I talk about the foundation, we're ready for the uptick of flips that we expect to have. We've gone from a much longer flip process that was much more customer touch engagement. Now that we've moved them to the most current releases, we can automate most of it. One is the sales side, the carrots, and the disincentives we talked a little bit about. The other side is, are we operationally prepared to execute on it? That drives our confidence. I'll just make one final comment. As you look at Tyler's growth over the years, and there's a lot of factors, but I believe we have the best sales engine in the business. The coverage we have, I think there's areas to improve, but I think it's been a big part of our success. Just like a lot of Tyler executives and really up and down Tyler, the tenure at Tyler is so long. Our tenure and our sales organizations, they know this market so well. They know our product portfolio. As we grow, there's tweaks we need to be making, and we're looking at all that. Hats off to our sales organization. They do a great job. I would add one other thing that's underpinning that is the investments we're making and the effort we're putting forth around improving our client experience with our new Chief Client Officer, Andrew Kahl. A number of significant initiatives there to improve our overall client experience, especially as our clients have more and more products from us, and to break down some of that friction that comes with that. That makes customers more willing to move to the cloud with us, more willing to buy more products from us, and is really a key factor in that transition. Morning. Connor Passarella from Truist Securities. Thank you for having us. Russell, just sticking with the flips and tracking towards the 85% cloud penetration target in 2030. As we think about the evolution of cloud adoption within the base at this stage, it seems that Tyler's done a really good job with educating the base on the benefits of cloud over the past several years. That said, as you look at the current bottlenecks, how impactful are things like implementation timelines, as well as the general complexity of large customers and systems that still have to flip? That's a great question. When we've started this the last three years, if you asked me the first 18 months, we would find some bottlenecks. Processes that were built over 10 years of an on-prem system that had created an ecosystem between tooling and our capabilities to move through that has significantly reduced the bottlenecks. Some of the bottlenecks that exist today is more about seeing the incentives that we're offering, the value that's going to provide. I think there's a great point made of some of our customers who have even said to us, "We need to understand what's the path so we can get through this as a priority in our budgeting." It comes down to going through with the customer and addressing their individual bottlenecks. We do readiness assessments with them and then prepare them for the flip process. Operationally, what used to be very complex now has a pattern for execution on each flip we go through. Different clients need different kinds of help as we approach them to undertake a flip. If they have more products, that's going to create more complexity. They need our help to map out that transition. They may need our help to model a financial arrangement that takes into account the fact that they just purchased a bunch of hardware for a data center, and it needs to take into account those bubble costs. Every single customer is different, and our engagement with them is really what drives that adoption rate. It becomes more personalized on the value statement for that individual agency. Yeah. We'll go to Adam and then Parker. Great. Thanks. Adam Hotchkiss with Goldman Sachs. Thanks so much for doing this. A lot has been made recently about AI's impact on cybersecurity, and even more so lately with some of the news flow around the most recent Anthropic models. How, if at all, does that impact customer decision-making at this point? Then how are you posturing your product and innovation priorities in the context of some of the unknowns in the security space? Thanks so much. Russell, take that. We are diligently on top of it. We're in partnership with the partners that we have, with the model-generating frontier model companies. It's something we think about all the time. The way we look at it is the work that we're doing, this continuous update and delivery and inspection process of our environments, is what the future needs to be. What this is also driving in the industry is it creates greater concern for the on-premise environments that exist. That's been a driver for years. I can tell you stories right now of mission-critical systems that have experienced an issue and us, as a partner who's been able to move them to the cloud in under 72 hours. That's not a one-time thing that's occurred. That's a common pattern. What we're seeing with AI is the increase of concern on that, and the cost to keep up with the risk in these on-premise environments are increasing. So we see it just driving additional adoption for our software-as-a-service offerings. Parker, over here. Thank you. Parker Lane Stifel. Russell. Russell, sorry. It's all right. The version consolidation, you gave some really nice examples of the flagship products and the success you've seen of getting customers current there. If you take a step back and look at the entirety of the platform, how would you assess the progress on the product level? What do you think that journey looks like here on the course to your 2030 targets? Just in summary, I think we've made significant progress pretty much across all the major products. I'll address them on our product maturity stage, if they're in a growth stage, or some products that we have that are more in a maintain stage. All of our major growth products have made significant progress in version consolidation. The way that this is going to roll out is when we start piloting clients in Cloud Living, that's on one SaaS software version. We're building customer advocacy as we go through those pilots. Then we're consolidating everyone else into the Cloud Living operating model over the next few years. You're going to see whether some of those products still have two product versions, or they have four. All of those are going to consolidate into the Cloud Living SaaS version. Matt, we'll take you back there. Andrew's back there. Got it. Sorry. All right. Matt VanVliet from Cantor again. You previewed the raised free cash flow target for 2030. I'll take an opportunity to question here, and maybe Brian will give us more later. You raised that. I think since you set those targets, there was an IRS deal that you thought you had that fell through. The Texas payments contract has gone away. There's a fair amount of revenue that's been lost. You've made some acquisitions. There's been some federal tax legislation that has maybe improved on the free cash flow side. How much of those one-time ish or outside of your control type of things have changed that number versus internal productivity, better free cash flow conversion, maybe faster migrations than you originally projected? What are the puts and takes there to raise that number significantly? Yeah, I will talk about that a little bit more later. I think at the core, the key driver of that is higher margins. Operating margins driving most of that. You're right, there have been a number of puts and takes. When you think about the recurring revenue growth, that 10%-12% target is still what we talked about from 2023 to 2030. We did have, in that original model, $100 million of transaction revenues between Texas and the IRS, that albeit at much lower margins, have gone away. That's been a margin positive, but a hole that we have more than filled with some of the other growth initiatives. The taxes does have some impact on it, but it's mostly operating margin. We'll go to Andrew. Great. Thanks. Andrew Sherman with TD Securities. Thanks for having us. The 11% market share, this industry is obviously very highly fragmented. How has the competition evolved over the last few years? Have you seen the point solutions subside a bit, just given what's happening in software overall? Are the big ERP players getting any more or less aggressive? Just talk about your ability to become the standard across different product categories within these big counties. I'll start. Jeff, you can jump in. I would say generally over the last couple of years, I wouldn't say that I've seen a meaningful change in the competitive landscape. We remain extremely competitive across all our core offerings. No real changes. We compete very well. Every deal we fight for is hard-fought, even with our flagship products that we dominate. We never take this business for granted, but we're able to leverage those strengths that I talked about before to continue to win business and continue to grow our market share. Some competitors have cycles. They come and go in terms of their competitiveness. That happens across our entire portfolio. Every single one of our product lines, our divisions, would be able to rate their top three competitors. I think the thing that's interesting is that none of the competitors across those product lines is the same. It is very fragmented. At least I've been at Tyler for almost 35 years, and what you've seen is just a churn of those competitors over time. The big horizontals will play in the market, especially when the broader economy is soft. When it's hotter in a different industry, they'll go run over there. The small outfits will get acquired. They'll go out of business. We may acquire them. There's a constant churn in the competitive playing field in each of those different subverticals, but there's no consistency. We don't have any competitors that span across that entire- Yeah, just to add to that. In any of our markets, whether it was public safety years ago, some of these native cloud startups, or you talk about a horizontal player that comes in, there's a lot of times when someone comes in and makes a quick splash and all of a sudden is able to get a lot of contracts. What they have a hard time doing, no matter it's the very largest companies that are coming in our space or some of the startups, is executing on the business, and that's where they tend to fail. Just because you may read some headlines that they won half a dozen contracts, check in with those clients six months later, nine months later, they're not able to do it. A lot of times we end up getting that business again. I'm going to go back to what I talked about at the beginning, reputation and trust, decades to earn, that's what separates us. We're always going to have competitive cycles, we're up to the fight. We're going to take one more question from Trevor, then we'll close the first Q&A. Thanks. Morning, everybody. Trevor Walsh from Citizens. Russell, maybe for you, just more of a clarification, just based on both what you had in your briefing, some of the responses to questions. When you were talking about Cloud Living, you said there was going to be a release in 2027 or a launch of some sort. I'm trying to understand it. Is that a platform, that single version kind of prepared, kind of technical piece? If so, does that mean we should assume that the updates to versions are going to be completed by that 2027 launch time? Yeah. Am I kind of conflating these two things? Yeah. Just a little bit more color or explanation would be helpful. Yeah, please don't assume that. The way that we're going through that for 2027 is our release process, there will be updates that are going to go out to our customers every biweekly cadence, as I mentioned. You'll see from Tyler introduce what's called four quarterly seasonal releases across all of our products. When we talk to our customers, we'll be talking about what's coming in the spring, the summer, the fall, and the winter release across all the products that they have. What we're doing in 2027 is each of these products is working with early adopter clients to go into that release model on the platform where they're delivering more frequently, and quarterly, they're activating the features for our clients so it's non-disruptive. We can activate features for them without ever having to actually deploy anything new. It's already there sitting behind flags. That's the process we're going through in 2027. Our goal is get these initial clients rolled out with it. They're our champions. They're talking about it at Connect, ultimately that drives additional adoption. Due to the historical pattern, we're now making this more of a seamless update process, but we have built up over years it being more of a project process. We're taking that out of the equation. An important part of it is the technology to facilitate everything Russell just said, but more important than the underlying technology is a shared methodology across all our product lines, and it basically giving customers the exact same experience in receiving those updates, regardless of which product or products they may be using. Yeah. Okay. We're done with our first Q&A. We'll take about a 10, 15-minute break. We'll get back on schedule with Franklin Williams, our Chief AI Officer for AI strategy. [Break] Our program will begin soon. Please find your seats. If everybody can take a seat, we'll get started with the second half of our presentations. It's my pleasure to bring up Franklin Williams, our Chief AI Officer. Sorry. Awesome. Very great. Thank you, Hala. Good morning. I'm thrilled to be with you here today to talk about how AI ultimately makes Tyler a stronger company. My name is Franklin Williams. I've been working in the GovTech space since about 2014. First as a startup focused on selling data and insights into the public sector before I had the opportunity to join Tyler in 2018 as part of the Socrata acquisition. Since 2019, I've been leading the data and insights division. For the last two years, I've been working on Tyler's AI strategy, both in terms of how we use it to transform our own products and how we use it to transform the work that our clients do, how we use it to transform our own work internally within Tyler. I use that word intentionally, transform. We truly believe this to be a transformative technology on the same par as mobile and SaaS and other transformations that we've been through as an organization. So too, clearly, does the market. However, we think that there are a couple of things that the market misunderstands about Tyler. The biggest misunderstanding is the impact that AI is going to have on Tyler's valuation. Let me be clear. AI is going to make Tyler a more valuable company than it is today. Let me repeat that. AI is going to make Tyler more valuable, and it's going to do it in two key ways. The first thing that it's going to do is it's going to strengthen our existing business. The $2 billion that you see on the right, the growth rates that you've heard us talk about all the way up to 2030, AI is going to make that business stronger. There's another thing that it's going to do, and I think this is something that people miss and something maybe people don't appreciate about the position that we're in. AI is going to unlock a whole new TAM that is ripe for Tyler's taking and that Tyler is uniquely positioned to win. Over the next 20 minutes, we're going to talk about each of these. We're going to talk about how AI strengthens our existing moat, how AI opens up a new TAM that Tyler's uniquely positioned to win, ultimately, we're going to close with exactly explicitly how we do that. Let's start with how AI is strengthening our business. You heard Lynn talk about this a little bit earlier today. You heard Lynn talk about how the public sector market is structurally different than the private sector. That holds with AI as well. What that means with AI is that the pace of adoption for AI in the public sector is going to follow a different path than it does for the private sector. At some level, the market and our position within it is a key element of our moat. Public sector buyers are notoriously risk-averse, and risk-averse buyers choose trusted incumbents. Nobody has more trust in this space than Tyler Technologies. Our earned position, what we've earned over the last two decades, means that there's nobody better positioned to bring this technology and nobody better positioned to lead this transformation than Tyler Technologies. Tyler Technologies is bringing a number of key advantages that we believe are going to strengthen the business. I want to talk about two of those right now. The first thing that I would highlight if we think about data is that the systems that Tyler sells, these systems of record, are critical infrastructure for the government. They are producing critical data every single day that any piece of AI that's trying to improve the public sector is going to need access to. The second thing that I would highlight is that our clients are fiercely, fiercely protective of this data, almost paranoid about the data. You'd asked a question earlier today about, hey, how do we think about Anthropic, how do we think about people maybe vibe coding and replacing the systems of record, these ERPs? Truthfully, we don't really see it. We don't see that risk. The reason why we don't see it is because of some of the things that you see on this slide. Our clients are fiercely protective of that data. If you think about what's in these systems, it's critical information. Social Security numbers, payments, bank info, criminal records, all sorts of stuff that our clients, one, they don't have the staff to really do this, and two, they're not going to accept the risk of disclosing that data and disclosing that information by vibe coding their own. One thing we do think they'll do, though, and one thing that we think is ultimately going to make these systems much, much more valuable, is we do see them using AI to build integrations on top of these systems of record. When they do that, we think that that's going to make these systems of record much, much more valuable. These systems of records, to access this data, again, remember, our clients are pretty paranoid about it. To access this data, they're going to either have to go through a trusted layer that's owned, audited, and governed by Tyler, or they're going to have to use AI agents that are owned, audited, and delivered by Tyler. In either of those situations, you're going to get more and more integrations on top of these systems that are going to increase the stickiness, increase the value of those systems. Just walk with me a little bit through a thought exercise. Imagine you're a CIO, and you're supporting a staff of hundreds, if not thousands, of people. That those staff are starting to build integrations on top of that system of record. Maybe they're vibe coding a dashboard. Maybe they got a little something that takes a little bit of friction out of their day. Imagine a year, two years, three years goes past, and you come to this decision, you're like, "Okay, what should we do with this system of record?" Three years pass, you've got thousands of integrations people are using every day. Is that system of record more sticky or less? Are those switching costs lower or higher? We would argue that AI has made those switching costs higher, and we would argue that AI has made that system of record, particularly that critical system of record that we sell, more sticky and more valuable. There's another advantage that I think some people miss, and that's what you see here on the right. This is the advantage that we really bring within distribution. You heard me talk about having spent some time in a startup, having spent some time at Tyler, and it's given me a unique perspective. I've gotten to see this specific market from two different angles. I've gotten to see it from the angle of a startup, and I've gotten to see it from the angle of a trusted incumbent. Let me tell you, I can tell you firsthand that trusted incumbent is better. Particularly in a world in which feature development is accelerating, and your big bottleneck is not how quickly you can build, but how quickly you can sell and how quickly you can scale AI into this market. Tyler's advantage is here, the 16,000 clients that we have, the deep trusted relationships, the earned position that we have in this market, means that there is nobody better positioned to deliver this technology to our clients. Tyler can be scaling this technology to hundreds to thousands of different doors, while our competitors, particularly new entrants, are still on their second procurement. That's why if all we did was play defense, if all we did was focus on that $2 billion and the growth rates out to 2030, we think we'd be in a stronger position with AI than without it. Now, of course, that's not all we're going to do because there's a bigger prize that's out there. This bigger prize is a new TAM that AI is going to make uniquely available to Tyler. Let me tell you a little bit about what we're looking at on this slide here. On the left-hand side is you see our existing TAM, vertical software in the government space, about $44 billion. On the right-hand side is the TAM that we start getting into when we start moving away from systems that simply record outcomes to systems that drive outcomes. Now, I think one of the things that people often overlook or misunderstand about our market is just how hard it is for people to hire into this market. This is a market that is ripe for a technology that can help people do more with less. It's ripe for a company that can come in with a trusted position and help people do more with less. That technology is AI, and that company is Tyler. Let me give you an example of what this looks like in practice. We have a solution today that we call Document Automation, and what this does is it helps people do more with less by taking off things like data entry, document redaction, the things that people will spend weeks doing in the public sector. Again, walk with me and put yourself in our customer's shoes. Imagine you're supporting a staff. You've got dozens of people that are doing nothing other than data entry, document redaction, and filing. You would go hire another 12 next week if you could find them, but you can't. Now, imagine that a company comes along, Tyler comes along, and we say, "Hey, we can actually help you with this problem. We can use AI, and instead of needing a staff of dozens, you'll need a staff of five. When you're done, you're not going to get an 85% accuracy, you're going to get a 95% accuracy." Well, that solution would be pretty valuable to you, right? Particularly if the company that was delivering it was uniquely positioned to deliver it because we had the data, the expertise, and the trust that the public sector requires to deliver these types of capabilities into the market. That's the type of opportunity that we're seeing here on the right-hand side. That's the type of opportunity that we get pretty excited about at Tyler. It's also an opportunity that we think we have a unique right to win. You can see all of the things that are uniquely required by the public sector to deliver AI into this market. There's a lot of them. You've heard me talk already. You've heard me talk about trust. You've heard me talk about data. You've heard me talk about distribution. There's one more on this list that I want to spend just a couple of seconds highlighting, and that's expertise. We've earned our position in this market over decades. We know the jobs that people are trying to do in the public sector almost better than they do. What that means is we can deliver AI, we can deliver agents that are helping them do more with less, that are helping them do those jobs better than just about anybody that's out there. Here's the really cool part, and this is also a thing that I think people miss, is that because of our continued focus in this space, these agents, this AI, is only going to get better over time. We're going to basically be in a situation where we're going to get a bit of a flywheel effect turning here. What's going to happen there is people are going to use our agents. Those are going to produce data. We're going to use that data to make those agents better. What's that going to do? It's going to cause more people to use them. Then they're going to produce more data. Those agents are going to get smarter, and two things happen. Our clients are going to get a ton of value, but then the distance between us and our closest competitor is going to start to separate over time. Again, nobody has the focus that Tyler does, and nobody can get that flywheel effect turning like Tyler can. When we think about our competition, we don't think that there's actually anybody else that's out there that can provide these capabilities like Tyler can. There's no horizontal SaaS player, there's no AI startup, there's no point solution. I would argue that there's even no hyperscaler that has the unique set of advantages that are required to win in this market and the unique set of advantages that are required to deliver in this market. I don't want you to just take it from me. I want you to hear from our clients about why our market is unique and specifically why Tyler is well-positioned. For the next 2 minutes, you're going to hear from a series of our leading clients that are using Tyler AI solutions today that are helping them do more with less. They're going to tell you a little bit about why our market's unique and why Tyler is the only vendor out there that they trust to deliver this transformative technology into their jurisdictions. Yeah, as far as AI, we're kind of at a crossroads right now. I've always said when I was elected that I wanted to have the clerk's office of the future. The City of Naperville's journey is really at the start. Characterize my organization's approach to AI in one word, I would say cautious. Public trust is at the top of the list. Security is one of the big things, especially in the public sector, because there are security concerns. We handle a lot of very sensitive data, so we need to be very cautious in how we're handling that data. It's easy to say AI is great because it'll do all these things. We have to find a helpful way to incorporate that into our staff's workflows. You've got to be able to provide AI within the software systems you have. They're not trying to go outside and try to use external tools. If it's built in, I believe that'll create a much higher level of security. If we were to try to go with a third-party vendor and try to bolt it on to our existing Tyler products, I would have much more concern about that. Tyler's years of experience in the local government space has really given them a lot of insight into how different levels of government operate. They understand our business processes. They've been serving local governments for many years. They're well-suited to develop AI products for the public sector. When we had an opportunity to look at AI, there was no other way to go. Wonderful. You heard from me, you heard from our clients about why our market's unique, why we're well-positioned to win, and why we have a unique right to win in this market. Let's spend the last 10 minutes that we have together talking a little bit more about explicitly how we win. If you want to understand Tyler's AI strategy, there's really kind of three key things that you need to understand. You need to understand how we embed it, you need to understand how we price it, and you need to understand how we scale it. If you can understand those three things, you're going to have a great foundation to see how AI is going to drive incremental revenue for Tyler. Let's start from the top. Let's start with how we embed it. In the video, you heard from our clients, and they told you how important it is to have AI that's available where they work. That's what we're doing. We're bringing AI capabilities directly into the workflows where our clients are already working. By the end of the year, we expect to have 25 different agents in production being used by our clients across 100% of our flagships. Not only is that going to give our clients industry-leading value, and this is super important, that's going to give us a platform on which we can start to monetize AI across Tyler's very broad and very diverse client base. When we think about monetization, we're thinking about monetization really in 3 tiers. The first tier that we have is what we call our essentials tier. These are the table stakes features. These might be the freemium upsells where we're trying to move people to higher tiers, or they might be the type of features that benefit not just the client, but also Tyler as well. Let me give you a quick example of what that might sound like. We're in the process of embedding agentic support into our core flagship products. This is support that kind of rides along with the user. It sees what they're doing, knows who they are, and can, because of that, answer questions in a targeted way and provide a better experience for the client. Our clients get a better support experience, that also benefits Tyler because there's simply less inbound cases for us to handle, and over time, we see our support costs decreasing. The types of capabilities that you might see here in this first bucket, this kind of essentials bucket. The second bucket is one that we get pretty excited about. This is a bundled set of AI capabilities, things around agents, access to information and data, and AI capabilities that we think will ultimately lead to a premium uplift on top of our base SaaS SKUs. So this might be something along the lines of an order of 10%, 20%, 30%, but we really think that this is a meaningful uplift that is going to cover really the broad portfolio of Tyler solutions. The one that we get really excited about, the one that is represented by the right-hand side of that TAM that I talked about earlier, is when we start talking about outcome-based. These are places where we share measurable savings and efficiency gains from our clients. When we're putting time back in people's day, money back in their budget, we're able to command a premium there, and we're able to basically deliver AI that we can charge for that's commensurate with the value that's being delivered. An example of that might sound like Document Automation, something that we talked about earlier, where instead of needing a team of dozens, you need a team of five that are helping you drive these outcomes, and the remaining staff are freed up to work on more pressing problems and get back to the mission of government. The final leg of the stool, the final thing to understand about our AI strategy is, again, how do we scale this? How do we get it out into the market? This is, again, a place where Tyler's unique advantages really come into play. We have an install base. You heard Russell talk about Cloud Living earlier today, and what that means is that we can turn these capabilities on with a flip of a switch. No new installs for clients to manage, nothing new that has to get installed. We turn it on, those capabilities are there. We have an established sales force with deep relationships that can push these products out in the market and get us to hundreds of thousands of doors before our competitors even are on their second procurement. We have a path to procurement where we can attach an amendment to an existing contract and procure these solutions in the order of weeks, whereas the new entrants may be spending quarters, if not years, navigating the procurement cycle. Finally, you heard Lynn, you heard a number of people today talk about trust. Our clients trust us. They trust us to run their critical systems, and they trust us to deliver this transformative technology in a way that's going to work for them. What's exciting about this is that this work is well underway. Again, you heard me talk about by the end of the year, we expect to have 25 different agents across 100% of our flagships. If you attended Connect, you saw the launch of Tyler Foundry, our platform for agentic AI across this entire portfolio. The work here is well underway, although I will say that because of the pace of our market, we do expect this to be a multi-year journey. However, we expect the prize at the end of this journey and the opportunity at the end of this journey is going to be significant. To try and give you a sense of what that opportunity looks like, you heard me talk earlier today about our pricing strategy. You heard me talk about the 10%-20% uplift on top of 16,000 different clients and $2 billion. I want to share with you three early examples that we have for our clients that show that this story is resonating in the market and that our strategy is working. Let me share with you the first from a client in Tarrant County who's telling us, "With tools like Tyler's Document Automation, we're starting to look at our labor budget as a software budget," because that's where Tyler is adding value, and that's where we're seeing real opportunity in our client base. They pay us roughly $900,000 for their core system of record. By adding a single solution that helps put time back in people's day and money back in their budget, they're paying us almost 43% more, almost $400,000 more for a single solution. Another client, City of Doral, Florida. We beat out 40 different vendors in this, the reason why we did was because they told us that Tyler's built-in governance, security controls, configurable workflows, and future integrations reinforced the city's commitment to investing in technology for tomorrow, not just for today. They're rewarding us for that. They spend about $190,000 on their core system of record. That's Enterprise Permitting & Licensing. With the addition of a single AI solution, something that keeps their staff off the phone, that helps residents have a better experience, they paid us almost $40,000 more. A 21% uplift for a single solution. Finally, our friends in Placer County, California, tell us that, "AI is only as powerful as the data behind it. Our data lives in Tyler, and our workflows live in Tyler, and that's where AI needs to be." Placer is rewarding us for this strategy. They spend about $225,000 on their supervision software. After AI, with the addition of one AI solution, that again, is helping save time, that is helping with one of their most pressing problems, which is a workforce shortage and supervision, they're paying us almost double that base system of record. I hope what you see with each of these examples is that there is a significant opportunity ahead of us. We're obviously very encouraged by this, because of the pace that our market moves, we don't quite yet have enough data to raise our projections for the next five years. However, we believe, we hope you would agree, that the opportunity here is going to be significant. We also hope you would agree with us that at the end of the day, AI is going to make Tyler a stronger company. We hope you would agree that the public sector market behaves differently and Tyler is well-positioned within it, that our strategy is well underway and already resonating with clients, and we expect this to have a material impact on our business long term. However, if there is one thing and only one thing that I hope you take away from this presentation, it's what you see here at the bottom of this slide. It's that if you were designing a company from scratch to win in government AI, you would build Tyler Technologies. I want to thank everybody for the time today. I'm looking forward to the Q&A session here this afternoon. Thanks. Great job. Good job. Thanks, Franklin. If you all know me, I'm Lynn Moore. I've already been up on stage. I'm going to spend a few minutes talking about capital allocation. Now, earlier this morning, I talked about a new 2030 free cash flow goal of $1.1 billion to $1.2 billion. I think the logical question is, what are you going to do with all that money? That's a lot of cash. Ever since I've been a part of Tyler, capital allocation has been a real focus for me. It's been part of my responsibility, and it's a responsibility that I take very seriously. Specifically, I can't tell you how many conversations I've had internally about how do we take the cash we generate and turn it into increasing shareholder returns. Let's take a little deeper dive into our thoughts. I'm going to go through capital allocation in two segments. First, I'm going to talk about where we are today, then second, I'm going to talk about what our priorities are going forward. Let's start by reviewing what we've done in the last three years. At our last investor day, we outlined three priorities: debt repayment, strategic M&A, opportunistic share repurchases. If you all recall, back in 2023, we had about $1 billion of debt still on the balance sheet from the NIC acquisition. I think about $600 million in the convertible and almost $400 million in term debt. You can see over the last three years what we've done. We paid off that $1 billion of debt. We spent $360 million buying eight, nine companies. I can't remember the exact number now. We spent $840 million repurchasing our shares. I talked earlier in my first presentation about commitments made and commitments delivered, and this is just another example of Tyler making that commitment in 2023 and delivering on that commitment in less than three years. What's our capital position today? Today, our balance sheet is as strong as ever. In March, we paid off the $600 million convertible from the NIC acquisition. Last month, we issued a $1.4 billion convertible debt and also upsized and renewed, extended our revolver to $1 billion. Now, a lot of people have asked me questions, both internally and externally, "Why did you do the convertible debt?" The answer is really, to me, kind of simple. Number one, the convertible debt market is as good as it's been in over five and a half years. It was really robust. Then the way I think about it in my head is, to me, I was basically taking my 2031 free cash flow, and I'm putting it on the balance sheet today at really attractive terms to be able to go out and utilize that cash today. Another reason was, as part of that convertible debt process, we were actually able to do significant share repurchases on the day of offering. We bought over 1 million shares that day. Over $300 million we spent in that one day. We also took some of the money and invested in a capped call option to protect future dilution, which effectively raises the dilution up to $655 stock price. On the right side of the slide, you'll see what our projected cash firepower is over the next five years. We currently have $1 billion of cash on the balance sheet. We expect the free cash flow about $4 billion cumulatively. We have a $1 billion-dollar revolver. Again, $6 billion. That's a lot of firepower at our disposal for the next five years. One thing I want to emphasize, though, is yes, that's a lot of money, and it's easy when you put a lot of money on the balance sheet to maybe not have the same discipline that you've had for so many years. I can tell you, it's one thing I continually emphasize internally, one thing I think about all the time is we're going to continue to execute our capital allocation priorities with the same discipline that's been our MO for the last 28 years. We have a strong balance sheet. Our cash flow is growing. Let's talk about what our priorities are over the next five years. I spoke also earlier about consistency at Tyler, when you see these three priorities, they're really been our historical priorities since the 28 years I've been here. Invest in organic growth, continue to do strategic acquisitions, and do opportunistic share repurchases. Let's take a deeper dive into each one. Our first priority will continue to be internal investment in R&D. We're going to continue to invest in new product offerings, competitive enhancements to our existing products, and new functions and capabilities around AI that you just heard Franklin talk about. The purpose of this innovation, again, is simple. We want to continue to drive top-line growth, and we want to continue to expand our moat in this market. Our second priority, we're going to continue to pursue M&A. I mentioned earlier, M&A is part of our DNA, and it is. We've done over 60 acquisitions in that time that I've been here. As a reminder, what I said earlier, what do we look for in acquisitions? We look for voids or gaps in our offerings, new product capabilities, new technologies, things like AI. We talked about Document Automation and Priority Based Budgeting. We talk about increasing our TAM, adding to our client base so we can get more cross-sell and up-sell. I think one thing at the end of the day, and I mentioned this earlier, is we think about bringing a company in, leveraging our Tyler machine, leveraging our position in the market to help that company grow at a rate faster than Tyler's overall growth rate. At the last Q&A, Keith asked a question. Where are you, Keith? There he is. It's a question I've been asked before. How have these performed? A lot of times, these acquisitions, they get buried in the financial statements. It's kind of hard to tell how have they done. You've talked about what you like to do, but are they actually performing? What you see here is the actual and projected five-year revenue streams from the deals that we've just done in the last three years. Each bar on this chart represents a company that we actually acquired between 2023 and 2025. As you can see, we expect our revenues from those acquisitions to grow at a 24% CAGR in their first five years. Some of these are actual revenues they've achieved to date, and some of them are near-term projections based on what we see in the market. That's more than two times Tyler's overall growth rate. Again, these are just a sample of the acquisitions we did from 2023 to 2025. What about our most recent acquisition, FTR? That's not represented here. Let's spend a minute talking about it. FTR is the third-largest acquisition we've done in Tyler's history. They're the global leader in cloud-based courtroom recording and what we call legal-grade speech-to-text technologies. I'm really excited about this acquisition, and for good reason. It ticks all the boxes. It's adjacent to one of our core market-leading offerings, our court systems. It makes both products more competitive and more sticky. It's going to be accretive to growth. We expect their ARR to grow at a 20% rate over the next five years. It addresses a critical market need. There's a growing shortage of court reporters in the court business. They're a leader in the U.S. They have international operations. They've established that. That's another opportunity for us. Our strategy with FTR is to take their AI-powered transcription and unify it with our underlying case files to create what we call judicial intelligence. This is a deep data and AI play. We believe it expands the TAM by over 4x of what it was before. Over a $1 billion TAM we think this opportunity creates. Here's the critical piece of the puzzle. You heard Franklin talk about this earlier. Data. We own the data that's produced here. That's very critical. This is also a company that we knew very well. We made a minority investment in FTR in 2015. We've been involved. We've had a board seat. We know their culture. We've watched their strategy evolve over time. We've gotten to the point where it was this was the right time to pull the trigger on this acquisition. Again, at the end of the day, there's a lot to like about this acquisition, and it's why I'm excited about our third-largest ever. Our third priority is opportunistic, meaningful share repurchases. Bruce is already smiling. He's talked to me about this for many years. Excuse me. Our approach has always been opportunistic. We look at the market value of Tyler stock, we look at what we think the intrinsic value of, when there's a gap, we generally step in and buy. We have no fixed annual targets, we're always focused on long-term EPS accretion. In February, the board authorized a $1 billion share repurchase, you can see that so far today, we've executed on about two-thirds of that. That includes the purchases that we did in the convertible debt offering. That equates to about 5% of Tyler's outstanding shares. When I started on this slide, I talked about opportunistic, but I also talked about opportunistic, meaningful purchases. What do I mean by that? There's two things about that. Number one, when we buy, we typically don't nibble. We tend to get in and try to get a significant share of the market. Second, you have to really look at the disciplined approach that Tyler takes itself with respect to issuing equity. Let's take a look at what I mean by that. What you see here is a comparison of Tyler stock-based compensation versus our peers across 3 metrics. Total expense, a percent of revenue, and a percent of free cash flow. You can see on this chart that we issue shares at a rate of about half of what our peers do. I'm a shareholder of Tyler. I'm a shareholder of other companies, as a shareholder, I want executive teams to be vested in equity. I want them to think like shareholders, be aligned with shareholders' interests. That's the approach I've taken in designing executive comp at Tyler. All our senior executives are comped in a way that's 80% performance-based, 20% service-based. Of their total compensation package, there's a target of 70% of their target comp is based on 3-year long-term goals. Those goals are growing ARR and growing operating margin. As we know, operating margin turns into free cash flow, and those goals just happen to line up with what I said our measures of success are going forward, growing ARR and growing free cash flow margin. When you combine this approach of how we take to issuing equity, you couple it with the approach on share repurchases, it creates accelerated shareholder returns. In the last 25 years, Tyler's top-line revenue has grown over 2,000%, but our fully diluted share count has declined by 12%. I understand I'm not supposed to talk about free cash flow per share metrics. There's strict rules about that. I actually think it's a very valuable metric. It's a very valuable measure of a company. What you see on the left-hand side, which is not a free cash flow share per metric, it's our free cash flow from 2001 to 2026. In 2001, our free cash flow was a little over $3 million. Today, it's approaching $700 million. That's over a 20,000% increase in free cash flow. Again, at the same time, our fully diluted share count has gone down by 12%. To me, the takeaway from this slide, it's really representative of what I would consider our balanced approach to capital allocation. Taking our money, investing in top-line growth and bottom-line margin expansion, while also taking opportunistic share repurchases to lower our fully diluted share count. In summary, today, Tyler is extremely well capitalized. We've got a lot of flexibility to execute on all our priorities, regardless of the economic environment. As our free cash flow grows, our capital allocation will become more and more important. Our approach to capital allocation is consistent and it's proven, when you couple that with our disciplined approach to issuing equity, we're really well-positioned to continue to deliver accelerated shareholder returns. Now I'd like to turn it over to Brian Miller to go over the financials and review our 2030 model. Good morning, everyone. You've heard a lot today about our key strategic initiatives, excuse me, and the progress we've made across multiple dimensions since our last investor day in 2023. I'm going to recap our financial performance since then, and then tie together everything you've heard today into how it rolls into our updated 2030 targets. As Lynn previewed in his opening, we're a much stronger company with a visible path into the future than we were in 2023, with greater free cash flow generation, and that's reflected in our new 2030 outlooks. From a financial perspective, we're well on track to achieve our long-term objectives. What you see here are multiple vectors that are driving that performance. I'm not going to go through each one of these, but I want to highlight our progress with our cloud transition and our progress in growing recurring revenues that have been keys to achieving those results and will be keys in the future. Our performance to date really gives us the conviction in our ability to achieve our new 2030 targets. How did our 2025 results compare to the interim targets that we laid out at our 2023 investor day? What you see here in the middle column are how our 2025 actual results were achieved. On the right side, you see a whole column of tick marks that show that we met or surpassed all of those interim targets for 2025. What's interesting to see is how our revenue mix has changed over the last three years. Recurring revenues topped $2 billion for the first time in 2025, and we've achieved almost a 12% CAGR in recurring revenues. Our SaaS revenues have grown at a 21% CAGR, which exceeds the targets that we set out for that 2023 to 2025 period. Transactions revenues have exceeded or have been on the high end of our growth range at 13%. How is this growth translating to margin improvement? We've added 300 basis points to our operating margin, and the recurring revenue growth I just highlighted has really been an important margin driver. In addition to expanding recurring revenues, the progress with our cloud transition that Russell detailed earlier has also contributed to margin improvement. As you heard, there is much, much more to come from that side. We continue to maintain a very strong discipline around managing our operating expense. Before I move on to our updated 2030 targets, I want to spend a minute to update our 2026 annual guidance. As Lynn just discussed in his capital allocation presentation, we completed a $1.4 billion convertible debt offering on very attractive terms last month, and we were concurrently able to repurchase a little over a million shares of our stock. The impact of the convert is accretive to our full year 2026 earnings, with higher net interest income and a lower share count. As you can see here, we're raising both ends of our current EPS guidance range by $0.30 to reflect the impact of the convert. I also want to point out that primarily as a result of this change, our full-year earnings are expected to be a little bit more back-end loaded. Showing you the linearity that we expect here, approximately 53% of the full-year EPS is expected to be posted in the second half of the year. Now let's turn to our updated 2030 targets and how everything you've heard today comes together in a stronger outlook for Tyler Technologies. What you see here is a layer chart showing how our recurring revenue momentum continues through the end of the decade with a 10%-12% CAGR driving a higher recurring revenue target with better margins. The top layer is SaaS, which is the biggest contributor, with a CAGR of approximately 20% through the end of the decade. This represents an acceleration from our previous targets, which called for high teens growth from 2023-2030. The second layer is transactions, which are expected to grow around 10%, as Liz Thomas outlined, as we refocus away from lower margin commoditized payments and focus more on higher margin, higher value transaction revenue streams. And maintenance will continue to decline as on-prem clients flip to the cloud. On the bottom, you see non-recurring revenues with lower margins like services and hardware will grow at a much lower rate than overall revenues in the single digits. You also heard Lynn talk a lot about our M&A firepower and how we have a strong record of completing acquisitions that are accretive to growth. And Franklin Williams outlined how we believe that AI will be a tailwind to growth. The numbers you see here, the 10%-12% CAGR, do not include incremental revenues from M&A and AI, although we believe that both of those will provide additional growth on top of that. What you see here is a bridge to our 10%-12% targeted recurring revenue growth. Let me touch on the key drivers of that. The first is the uplift from on-prem clients flipping to the cloud, typically at a 1.7x uplift from their maintenance revenues. The second is SaaS growth from new logos and net expansion within existing clients. You heard earlier us talk a lot about that opportunity within existing clients moving from three products to eight to 10 products. That also includes pricing, which we typically see a very consistent kind of 5% pricing increase. And the third is transaction revenue growth, with M&A and AI revenues providing incremental growth on top of that. And while we're excited to continue to drive double-digit recurring revenue growth, we're also looking to get almost 1,000 basis points of operating margin improvement over the next five years. What you see here are the four key drivers to a mid-30s operating margin. I'll touch a little bit more on each of these. The first of these is the cloud. The cloud unlocks significant margin expansion opportunity for us, we believe in the range of 3 to 4 points of margin expansion. A lot of that comes from things like the version consolidation that Russell talked about. You may not realize that as much as 30% of our development and support costs are consumed by non-current versions of our products. You can really see how that continued focus on version consolidation can have a significant impact on our margin. The second key driver is transactions, that Liz talked about. She outlined how our differentiated transactions offerings are shifting us towards higher-margin transaction streams that are tied to our software. We expect to continue to be able to optimize the economics around our transactions business as it scales. For example, contracts like our California State Parks Outdoor Recreation software deal have software-like margins, even though they're recorded in our transactions line and are paid for with transaction revenues. This, we expect to add 1 to 2 points of margin. It should be no surprise to anyone that we expect AI to be a contributor to operational efficiencies and higher margins. You can see here the three major areas that we're focused on, where we expect AI to be able to drive productivity and enable us to grow headcount at a much lower rate than we grow revenues. We're still in the early stages of integrating AI into all of these internal functions, but we're comfortable with an expectation in our 2030 model of 3 to 4 points of margin. For example, in our services business, we've piloted the use of AI to assist with data conversions in new implementations with really exciting results, reducing our time to complete conversions from several months to 2 to 3 weeks. In support with one product, we're now deflecting 25% of the calls that would otherwise be escalated to a Tyler support team member, freeing those support team members up to work on more complex tasks. The fourth margin driver comes from operating expense, where we expect to gain 1 to 2 points of margin from leverage as we continue to scale. For example, by consolidating functions, improving systems, and adopting AI tools, we've been able to keep our finance headcount flat over the last two years, even as our revenues have grown by almost 20%. What's the impact of all of these improvements on our cash flow? Our 2030 model now delivers more cash and at higher free cash flow margins. As you can see here, our cash generation is now growing to $1.1 billion-$1.2 billion in 2030, with the free cash flow margin in the low 30s, up from the high 20s. The majority of the improvement is coming from higher operating margins, along with some working capital benefits from higher recurring revenue mix, which has more attractive cash flow characteristics. Here you can see how our updated 2030 targets are all in line with, or in most cases, improved from our previous targets. Now I want to focus in on four key targets among those, all of which represent improvements to our prior outlook. First, our new recurring revenue target is $3.3 billion-$3.4 billion, which is at the high end of our previous range. Second, our new target for operating margin is now in the mid-thirties, up from 30%. Third, our free cash flow margin has moved from the high twenties to the low thirties. Fourth, we expect to generate approximately $1.1 billion-$1.2 billion in free cash flow in 2030. How will you measure our progress towards those targets? Again, we're focused primarily on recurring revenue and free cash flow growth. As we move towards 2030, our recurring revenue growth rate and our free cash flow margin expansion are the best metrics to gauge our progress and our success by. In summary, you can see why we're excited about the future that's reflected in these new, higher 2030 targets. We've got a credible path to further success with two key metrics to measure our progress by. That wraps up our formal presentations. We've shared with you a comprehensive look that should give you a clear and confident picture of our future. Now we're going to bring back the rest of our leadership team for the final Q&A session. Okay. Lynn, come back up, and Franklin, and introducing Rusty Smith, our Group President, Local Government and Schools. Jeff, our COO, come back up. We'll probably have about 25, 30 minutes. We're running a little bit ahead of schedule here. Just a reminder to state your name and affiliation, and we'll get started. Go ahead, start with Rob. We'll go to Jonathan after. Great. Thank you guys very much. Lynn, I'd be curious to hear from you about M&A in particular. You guys have been, in my view, highly successful acquiring within your core and appreciated the breakout of the growth rates of some of those businesses, which we've seen, which you guys have plugged in and really accelerated. A few times over the years I've followed you guys have moved outside your core to make acquisitions, whether it be getting into public safety or getting into state and payments, new areas. When you think about M&A, how should we think about operating within those verticals in which you guys are already number 1 versus maybe looking at other areas where you perhaps don't have a presence within your current customer base? Thanks. Rob, I would say we're going to continue to follow the same playbook we've done for the last 28 years. If there's going to be an opportunity that's sort of what you may call outside our area, we're going to do a lot of work before we consider that. We did that with NIC. We knew a little bit about the public safety market because we had our own small town public safety product. Really careful about, sometimes people say, "Are you guys going to do a transformative acquisition?" I'm always cautious of that word because it means different things to different people. Even in our core spaces, there's still a lot of runway around those core products. The FTR example is a perfect example. We're dominant in courts with the CaseloadPRO, our Enterprise Supervision, added a bunch of TAM. I mentioned earlier in response to Keith's question, 7x revenue since we acquired it, FTR. There's still a lot of areas around some of our core verticals where we're dominant that there's still room and sub-markets around there to do deals. Jonathan? My question is really on AI adoption. This is Jonathan Ho from William Blair. When we think about sort of the testimonies that some of the customers gave, there was on the one hand the data points that many of them are sort of hesitant. They're in the beginning of that journey, but they're also very excited about the potential opportunity as well. I just wanted to understand how you think about that customer journey from going from the early adoption of the sort of solutions on the left-hand side of that chart and getting them to use the full utilization of the breadth of the products. Thank you. It's a great question. I think one of the things that we're really focused on there is, and one of the things that we heard even at our latest CAB at Connect, is that our clients understand that there's an opportunity there, but they're going to need to be led by a trusted partner like Tyler. If we can lay out the opportunity that's in front of them, the value that they can get, and we can lay out a path by which we can get them there, then they're going to be pretty eager to adopt these solutions. Now, there's a bunch of things and a bunch of pieces that we've got to get over to do that, but as we do that, they're pretty eager and pretty excited to adopt it. We have actually a commercialization program that is attached to some of the things that we talked about, 25 agents by the end of the year, that are really designed to start getting the proof points and to start getting more and more of these capabilities out to market in a way that the market can absorb and adopt. Rusty, do you want to talk a little bit more about what that program looks like? Yeah. I'll add some to that. When we talk about the adoption curve, we're in a position because of our existing client base to be able to affect a larger part of the public sector than anyone else can, and this is going to be an iterative process. Franklin talked about the number of agents that we plan to have in our products by the end of the year, but we don't see an end in sight with that. The rollout of that kind of thing is one where we need to be thoughtful because our clients have different personalities. You have a few that are pioneers, but mostly the client base is such where they're waiting on those that have proven it. Every agent that we roll out, there will be an early adoption period, and we're going to be really thoughtful to make sure that we communicate to the rest of our client base what the progress has been with their peers. Again, because they speak with one another and they share business practices, the success that we can have with those early adopters can then drive the momentum through the rest of the client base as well. The other thing that I would start to think about is as we think about most of our clients being in the cloud, and historically the bottleneck of delivery of technology being the software development pipeline and ultimately the consumption of new features, that goes away. A new bottleneck potentially gets created in our clients' ability to actually absorb new technology that we're taking to them. If there's anything that I believe is part of our core capabilities, it's understanding the public sector, understanding how they go about adopting technologies. You'll actually see more emphasis that we place over time on our client success teams so that we're there with clients helping them to absorb a more rapid rate of technology that we're able to provide. We'll go to Clarke and then Tamjid. Clarke Jeffries with Piper Sandler. Really encouraging to see the 20% SaaS CAGR. I think that looks very healthy through 2030. What stands out is that teen SaaS CAGR in the organic side, even without AI. That seems like very consistent growth in the core SaaS part of the business. What drives the confidence there? Maybe are the recent acquisitions meaningful contributors to that CAGR in the core business organic? I think over time, those are certainly contributors. As Lynn laid out, the growth rate across acquisitions, and that didn't include FTR yet, is significantly higher than our core growth rate. That does, after the first year, become higher organic growth. Really, a lot of it is around that opportunity that we've got to expand in our existing customer base, that cross-sell and up-sell opportunity that just gets bigger as we do more acquisitions, as we develop more products, as we create more horizontal things like AI, like payments. Really, that SaaS growth driven by the increased cross-sell and up-sell opportunity with our existing customers, as well as that very consistent, steady new logo business that's the traditional replacement of aging systems that are at end of life. Just one follow-up for Franklin. Just when you think about the M&A posture in a new AI environment. Wh ere does build versus buy sit with AI specifically? I think that the track record of the company has been system of record categories- Right a lot, and this seems like a new vector where the M&A posture might be different. Yeah, it's a great question. I think the types of things that we would look for in that acquisition would be some of the benefits that we talked about here today. We'd be looking for targets that have a unique data profile, like what you heard about with FTR, that have unique expertise, that are in an adjacent market to us, that have a lot of client trust. Those are the types of pieces that we look at as bringing unique assets to Tyler that amplify our existing moats, that amplify our AI story. Some of the historical things around the code itself, those are becoming, as you know, more and more of a commodity. Those core assets, the data, the expertise, the trust, those are the ones that we will look for, and those are the ones that we think will be very accretive to Tyler's value and to the value that AI can drive to our clients. Yes. I would add that build versus buy is always part of the equation. No matter what we're buying. Secondly, when you think about even companies that are more core solutions, we also are now part of the analysis, what does AI do to this market? Do they have a moat? Franklin spent 20 minutes talking about how AI's going to make us stronger. We think it's going to make our moat wider. We need to do that same analysis as we look at potential M&A candidates. Yep. Every CIM that we look at has the word AI on it somewhere, right? It's not all created equal. It's looking for those opportunities that have something really unique. Yep. those are the exception, not the rule. Tamjid? Hi, this is Tamjid Chowdhury from Guggenheim Securities. I guess just trying to get a better understanding, Franklin, on your tech stack as it relates to AI. Yep. Do you fully need to realize version consolidation in order to implement Tyler Foundry and then go to customers with product? Is that a prerequisite, or can you go to customers Yeah without that happening? Happy to. We've architected things in such a way to where they can indeed be decoupled if we need to, where the stack that is powering Tyler Foundry can be decoupled and deployed out to agents, or deployed out to clients. We think that there's a lot of benefits by having clients on a consolidated version and in the cloud. We think we're going to get faster time to value, we're going to get more at-bats. We're going to do a number of different things that you heard about today that are ultimately going to benefit our clients. That's where we're going. Architecturally, though, we've left some options open for us to basically learn from the market, and to take a different path depending upon what the market tells us. Awesome. Thank you. Arsenije. Hi, Arsenije from Wolfe Research on Alex's team. Brian, with those targets, that 20% SaaS CAGR implies a 15% CAGR decline in maintenance, right? I think that expands on Lynn's earlier point on operationally, things are just better at Tyler, that go to markets improve. There's less of that silo dynamic when, in fact, you're saying there's no AI in these targets, which is one of the carrots and sticks in the movement from maintenance to SaaS adoption. Understanding your targets imply better operations. There's conservatism on AI, and at the same time, we're looking at a cadence of buybacks this quarter that's a historic record, right? How should we think about Lynn's important focus on capital allocation when it comes to that buyback, when we're seeing that board authorization, 33% of it's left? Should we think right now, look, you're seeing operational benefits, the market's not really rewarding, until you feel that's being reflected better, there should be a continued maybe refresh of that board authorization on buybacks and have that more of an actual buyback focus until we get more aligned with market understanding on what's going on at Tyler? Well, I don't want to jump ahead to a new board authorization, but we have created this very consistent approach that Lynn outlined to share repurchases. This is one of those time frames where we believe the valuation that the market is applying to Tyler does not reflect the full value of our future opportunity, and we are certainly more heavily weighed towards using that cash and more of that additional firepower that we just created towards repurchases, while we still have plenty of firepower for M&A. For the internal investments that we need to make. I think that's consistent with the way we have demonstrated our approach to allocating that capital. I would add, we spent some time, Franklin spent some time, essentially debunking the argument that our terminal value has shrunk. If we believe that, we do, what is the virtue value of $1.1 billion-$1.2 billion free cash flow today? I think my mindset has been since the convert and we did that share repurchase, we just kind of wanted everything. We've done a lot and let's kind of let things shake out a little bit. Let's let the market just see where it is. There's a reason why we have that billion-dollar share repurchase. I'm not going to commit to when and how we're going to execute it on it. Bruce is going to ask me later what my formula is. He does every time I see him. I'm not going to share that. It's like the Coke formula. It stays tight. It is something that we're going to continue to focus on. We have a lot of firepower over the next few years, today, I think, when you're talking about a roughly $300 stock price, I think there's real value there. Got it. Thank you. Allan? Hey there, Allan Verkhovski with BTIG. Thanks for taking the question and another very insightful investor day. I liked seeing that slide of how your AI products are driving an uplift from between over 20% to over 100%. What are you learning most about your customers' willingness to pay? If I'm a customer, I'd probably prefer closer to the 20% subscription uplift rather than outcome-based pricing. Can you just unpack how that conversation is going? Given how the public market lags that private market, what have you seen and expect to see over the rest of the year with respect to how AI might be impacting sales cycles? Perfect. Rusty, do you want to take that one? We still say we're in the very early innings. These examples that we're giving you, these are pioneers in the space. They're ones that we're able to provide clear ROI for them, and I would reference the quote that we had from Tarrant County in courts where they are now starting to look at their labor budget as a software. That does not mean the entire market is seeing it that way. Very early days. We want to be in a position to test the market's willingness to pay and to find out what is sustainable. We provide those examples to you because those are the best examples that we have, but it's going to take probably a couple of years before we get into a broader adoption set for us to be able to see what those patterns are. The conversations that we're having with clients, everyone feels like they need to be educating themselves and finding out what's available. You heard the quotes that there is a predominant mindset that they don't want to find a third party that then has to integrate into ultimately our ecosystem and trust that all of the security rights, auditing capabilities, and everything else is also shared there. We're in an advantageous position. Lots of conversations. It gets whittled down pretty quickly to those that are in a position where they have policies in place, they've got budget available, they're willing to buy. It's those pioneering ones that we're trying to put out in front of all of their peers to show that they're heroes. One of the things that you saw in the slides is our approach to pricing is going to be one of more of a freemium model. In our model, the most important part is the compounding element of the existing clients for us to be able to protect and enhance that annual increase. We'll provide some AI in order to protect and enhance that. We're also going to be including these agents with some restrictions around the volume of what they can process so that we can help them implement that, they can see real value, and then when it comes to them finding budget, they've got the examples that they can go to their constituents with, and it's not theoretical. That's going to take several years. When we think about where we are in the cloud journey and how the fact that, okay, we're 30% of the way through whenever we started tracking in 2021, that shows the pace of this market. We're trying for these aspects to compound on one another to say, "We need to be in the cloud before you can get AI." Over time, those that are able to implement technology and adjust their business processes that we can help them with, there may start to be a diversion within our client base, but our hope, and charge, is to be able to ultimately bring them together. We'll be focusing a lot of attention on those pioneers to be able to show the market what's possible. Yep, for sure. We'll take one over here on this side, then we'll go to you, Adam. Hi. Girish Bhakoo from TenCore. I'm new to the company, so sorry if you've answered these in the past. First in terms of integrating M&A, you've done so much. What have you learned? How do you do it today? How did you do it five years ago? Second, NIC, I believe, was the largest deal that you've done. If you can talk about the return on capital today. What you expected it to be when you did it, with what timeframe, and how is that tracking? Second, operational integration of NIC in terms of how much core software cross-sell is it driving and vice versa. Thank you. I'll start with what we've learned over the years. Every time we do a deal, we learn something new. We typically have some sort of debrief, what went right, what went wrong through the process, what things we could do better over the long haul. One of the things I've said many times within Tyler is successful people and successful organizations always look at themselves critically and look for ways to improve. That's something that we actively do with every deal. I think our process does get better over time. On the NIC acquisition, it's been a little over five years now, and I would say I couldn't be happier with the acquisition. You just saw part of the presentations where transactions were, what? 35% of our revenues. That doesn't happen without that acquisition. The strategy around it doesn't happen. There are times we talk about our slow-moving market, when we do an acquisition that large, one of the first things we do is we do it because it's a good company. We may think we can unlock value that has yet to be unlocked, but we're going to take a disciplined approach to do it. We've been very pleased with that acquisition. I don't remember the third question now. Do you remember the third question? The third part of I forgot the question. What was the third part of your- Third question? Just the cross-sell between- Are you landing with the transaction and then- Yeah, I would say, yeah, we've done a good job with consolidating our operations with former NIC. I don't like using the word NIC anymore. They're Tyler. We broke that. Sometimes with big acquisitions, it takes a while to do that. We've created a unified transactions unit where we're delivering a unified experience across our entire portfolio. We've sort of pulled that out and moved it in, combined it with other operations. We've done things with their sales teams. We've changed the way their go-to-market has. It's aligning more with how we're going. We've done changes with our go-to-market strategy within Tyler. It's been a lot of work, but it's been, I think, a successful process so far. NIC continues to be a big part of our growth and future prospects. One of the things that Lynn asks at every single acquisition pitch is: How does this company make Tyler better, and how does Tyler make this other company better? I think the NIC acquisition was a great example of how NIC added a ton of value to Tyler. Tyler has also added a ton of value to NIC in terms of helping them to evolve their business model, and have a greater reach into state government. In terms of the cross-sell, one of the things we found that as we moved to unlock that opportunity that we had with these deep relationships that NIC had at the state level with all of the Tyler products that we could sell into the state market, was that we were sort of missing a bridge there. Last year, we created a dedicated senior-level state sales team that really is the bridge between all of the Tyler products that we can sell into the state market and those teams, and the deep relationships we have on the NIC, the former NIC side. That group now is relatively fully formed and is producing some really exciting results. Some of the things that Liz mentioned earlier on the transaction-funded software have been the result of that combination of Tyler software capabilities and NIC relationships. Adam. Great. Adam Hotchkiss with Goldman Sachs. Maybe for you, Brian or Franklin, how do you think about token costs within the context of both internal efficiencies and some of your outward-facing AI products and pricing? As token costs move around, should we expect there to be variable pricing to make sure you preserve margin? How do you think about that? Yeah. I'll let you. I'm happy to address that. When we think about our products, we do think that there will be some variable costs. Think about it as AI credits that we're selling to our clients. You'll pay a fixed fee, because that's important to our clients, that certainty in their budget, and that's going to buy you some utilization, some sort of credits that you'll be able to spend on various models, various capabilities within Tyler. When we think about what that's looking like from an internal perspective, well, this is one where we're trying to be very intentional about what we're doing and where we're getting value. I think we've all heard the horror stories from Uber and everybody else over the last couple of months. What we're trying to do there is we're trying to take a very intentional approach to AI. We're not rolling out AI for AI's sake. We're going role by role, looking at the value that it can deliver, asking people to sign up to deliver that value, only then are we unlocking these tools. It's at that point that we start basically measuring, learning what's working, what's not, let's do more of what's working, less of what's not, and making sure that if we are increasing our token spend, we're getting commensurate value for it. That's how we think about the internal side as well. Great. I think this is internally, just like we do with clients, the focus on outcomes that produce value rather than just looking for nails to hit with a hammer. Yep. That really is what's going to enable us to have tighter control over that side of it. 100%. Keith. Keith Housum of Northcoast Research. Brian, just drilling down on the guidance that you guys gave for 2030. We thought about historically 100% or 100 basis point improvement in operating margin over the years. Obviously, a much larger increase in the operating margin expansion. How are you thinking about the cadence of that going forward? Yeah. It almost certainly won't be linear. It won't be a nice 200 basis points a year. You've seen some of that. For example, this year we have margin improvement, but it's not quite at the same level we've seen over the last couple of years. It may be a little bit lumpy around some of the things, and some of the things we don't really exactly know about because of the adoption curve of some of the AI, for example. More to come on that, but I expect that we will see consistent margin improvement from year to year. There may be years where it peaks a little bit more. As we get more clarity around some of the things like the impacts of the AI-related drivers, we'll have a little more clarity around how that'll play out. Yeah, I mean, Cloud Living and AI are big levers. I think they're real, they're tangible. Predicting what quarter and at what rate they're going to grow, we don't know, but it's going to happen. That's what's so exciting about both of those as we look to internal efficiencies. It would not be linear. It will take some time and ramp-up, I think. On the Cloud Living, you did hear Russell talk about some of the things that starting in 2027 will start to be accelerating. More of the version consolidation, the real impacts of the single version of products is really kind of beyond 2027. Any more questions? Rob, then Trevor. Oh. Thanks. Rob Oliver from Baird. One more from me, Brian. Just on the 85% of customers in the cloud or by 2030, high end of the range. You guys are certainly targeting nicely in terms of the flips. I guess something came out in Russell's comments about using more sticks starting in 2028, I wanted to get a better sense from you as to how you think about that contribution to the 85% number. In other words, when you look at how you project flips out, how important is it that you start to really move people to that at the end of this period, and how much pressure does that potentially put on you guys and your customers to hit that number? Thanks. Yeah. The stick analogy, I think is maybe the wrong way to talk about it. I think you said disincentives or. Yeah yeah. I think what we're really doing is we're looking at the back end of this adoption curve, and there are customers that are on that back end of that adoption curve who are basically choosing to do nothing, right? Part of what we have to do is to give them enough information that they understand that that is not a place that they can remain indefinitely, and that if we start planning with them sooner, they can have an orderly transition to a future state in the cloud. That's what we're trying to do when we talk about disincentives. It's being transparent with them that as the customer base that's on-prem starts to shrink, that the cost to maintain those customers is going to start to go up. The impact of that will likely be higher maintenance rates for those customers as that pool shrinks to a small number. It really is more about being transparent and giving them enough information that they can make the economic calculation and do the math themselves. I would add, Rob, I was going to say the other thing I think that as we go through this adoption curve is what we're finding right now is the bulk of that remaining list of customers to convert. They don't really need disincentives from us at this point in time. What they really need is they just need more help. They need help explaining the case to their governing bodies. They need help planning the financial elements of this transition and so forth. That really is where we are in that journey right now, is giving them more transparency and more assistance. I would add, Rob and I had this conversation in the break. There were several questions about go-to-market changes. This applies to flips, it applies to cross-sell. We're making structural changes inside of the company to more align sales teams that sell products to the same market. When you think about clients that have multiple products that all have a flip journey, what you'll see from us in the future is coordinating, maybe even a consolidation of those sales efforts so we can go to a CIO, and we can plan out the flip journey for all of their products. Historically, we've done that more on a product-by-product basis. Those conversations are the same conversations that you leverage across the enterprise to do more cross-sell as well. Really, the key to achieving all of that and unlocking all that is what we talked about, is this process of creating a real plan with each client over the next couple of years, where we will have an agreement with them, have an understanding of what's involved in getting there, and have that documented so that we have firm plans with each client. Trevor. Thanks. Trevor Walsh from Citizens again. Excuse me. Franklin, maybe just piggybacking a little bit on that token question, but not so much around pricing specifically. Yeah Can you provide some perspective on how, just more broadly, you think about partnering with the different frontier model companies? Are there nuances there that are maybe specific to the public sector client base that we aren't thinking about or might not be aware of that you've sort of got in your learnings over the last several months, quarters that are working on this? Yeah, absolutely. Let me highlight just a couple of things. First of which is, we are intentionally leaving our options open in terms of frontier providers. The way that we've built our platform means that we can leverage the best capabilities from Google, from Anthropic, and from OpenAI. That's important because all of those frontier providers all do individual things really, really well. That's kind of a core piece of our platform and core piece of our foundation. The other thing, though, that I think is of critical importance is, again, these are public sector, U.S. public sector entities that have critical data, critical needs, and are running mission-critical software. What that means is that the models that we're using, they're going to have to be reliable. It also means that at some level, there's going to need to be basically probably U.S. provenance over them. We're looking at that from the perspective of these frontier models. I think the thing that you're going to also see us do is over time, not immediately, but over time, you're probably going to start see us reaching for more and more of the open source models as well, as those capabilities continue to increase and as at some level you just need good enough for some of these tasks, which the frontier models, which the open source models are starting to become more and more and more capable. Things like Nvidia, U.S. provenance, their open source releases, those are pieces that we'll start to reach for again, because this market is so unique and, again, because this market is using just running the mission of government on an everyday basis. I think we have one in the back over here. Paul Davis from Marble Harbor. Thank you. Following on the M&A and the platform and version consolidation, those two may be in conflict. Presumably, acquisitions are going to continue to be moderately larger over time. I'm assuming that sometimes when you make M&A, you're buying a whole bunch of unconverted version proliferated applications, and in the past, you've been highly tolerant of that. That's probably helped retention and made things easy for a lot of these folks you bought. Now you're making this drive for disincentives. How do you balance those two? Will there be really two streams of increased consolidation with what you have in your portfolio today versus what comes in and then you start a new five to seven-year cycle, let's say, of consolidation with what you acquire? Yeah. I guess the short answer would be that most acquisitions that we've done in the last five, seven, almost nine years, I don't know, their technology's modern. It's been cloud native running in places like mostly AWS. They're already in the same public cloud that we are. Don't see a lot of that. What we do see is the ability to, like I said earlier, add clients that we can then get the rest of the Tyler products in. Back to Jeff's comment is not only how do they make us better, but how do we make them better? That's sort of the model that, as Jeff said, I raise with almost every deal we do. I would clarify that the consolidation, we talk about consolidating platform, it's not rewriting all of our software to be on a single code base. It's more of an orchestration of the various technologies that we have and have acquired. Appreciate that question and where it comes from. What we've been doing as a company that you see reflected in our cloud strategy, and there are also other internal initiatives to be much more consistent, actually creates the right type of environment for us to do more M&A in even larger companies. Now there are much more clear methodologies that we adhere to across the company. It's also very situational. You could take two different companies, one that had a lot of technical debt and an on-prem solution, and one that had a modern platform. You might look at that technical debt as just a big problem to solve, but in other cases, it could be a big opportunity because you now have the ability to flip those customers to a modern Tyler application. It generates significant uplift and growth within that install base, so it really is dependent upon the very specific company that we're looking at. Arsenije, then Allan, then we'll end this session. Hey, just to get a good understanding of where we are today in terms of public sector relating to AI demand. I guess six months ago, everyone and CIOs that led big enterprises started having their dev teams adopt it. You guys have good relationships with your customers, you talk to them and stuff. If we had to guess today, 100 customers that are renewing at Tyler this year, how many of them are coming to you guys asking you about, "Hey, does this integrate with OpenAI or Anthropic?" Just to get a good sense of how far behind public sector is and whether you guys are forward movers there for them, or whether they're coming to you first asking about these third-party integrations. Just one comment just to kind of level set. When I think about our install base, which is representative of a lot of state and local government, the number of cities and counties that have a dev team is tiny, right? It's the very largest of the organizations that have that kind of capability. I think it's actually fairly rare that we're getting the kind of question that you just alluded to. Yeah. I would agree. The questions we are getting, though, it's interesting. It's actually coming in more from the elected official side, which is new for us because there are a lot of startups that are covering the market well with their marketing, so they come to the department heads inside the public sector to say, "I got this email. This video looks like they can really help." Policy is important to them. When they do come to us, they come to us saying what they're hearing, and they want to hear from us what our vision is for how ultimately we'll enable them to do that same sort of thing. Large number of clients are really wanting to understand our vision. You've heard it from us today, then we get to talk to them about the pace and timing of which they'll be ready. They want to understand what a vision is, but not all of them are in a position to where they actually want to move today. Yeah. I'll give you just one data point from Connect really quick. We did a presentation, AI in the public sector, as part of that, we asked, "Hey, how many people in this room are being asked every day by their electeds, by any number, like, 'What are we doing with AI?'" Everyone's hand went up. Like almost 150 people in that room, everyone's hand went up. Then I asked, "Okay, which of you feel like you have a good plan with strong governance, with a roadmap for how this ultimately takes root?" Almost everybody, of room 150, maybe there were five, 10 hands, like a handful, almost everybody's hand went down. What that tells us is they're looking to Tyler to lead them through this. They know there's opportunity. They're being asked about it on a daily basis. When we can show up with the right impact in their organization, the right ROI, they'll follow us. They are still very early on that adoption curve. Hey there, Allan Verkhovski with BTIG. My last question will not be about AI. Brian, can you just unpack further what you've seen on the transactions business, which you now expect to CAGR at 10%? Given you previously aspired to achieve high 40s, low 50s gross margins, and now increasingly focus away from low margin commoditized payments, what does your new gross margin target look like on a relative basis to what you were previously targeting? Thanks. Yeah. We don't have an explicit margin target for each of the segments of the business, it would be higher than it was before. As we talked about, we're continually moving our focus away from lower margin, the commoditized kinds of payments, and into the higher value transactions that are tied to software. As I mentioned earlier, going from that previous 2023 model where we had $100 million of revenues associated with two of those commoditized clients, the IRS and Texas, both of those are not part of our model anymore. We've more than covered that in the growth model with the newer types of higher value transactions, that will continue to drive the margin trajectory up. As Liz pointed out, there's a blurring of transactions and SaaS, where there are some clients that meet in the middle where they're getting SaaS and SaaS margins within the transaction business. It's not our primary method of delivering software, it certainly fits in a lot of capabilities, we have the unique ability to offer that in a lot of cases because of our payments capabilities around that. How that mix plays out will affect those margins, in general, I'd say it's elevated from the previous expectations, even though the growth rate may be somewhat slower. Okay. I think that's it. We'll turn it back over to Lynn for closing remarks. Awesome. Thank you. Okay. I think it's a really great morning. I appreciate everybody's attention. Hope you really appreciate the presentations. I think a few closing takeaways from me. I've said it a few times, but today, Tyler is a much stronger company than we were three years ago. Our market is durable, it's growing, and demand remains strong. We have a wide moat based on a number of unique differentiators that really no other company has. A lot of runway ahead. We outlined that with multiple growth drivers, SaaS, transactions, M&A, AI. It's all there in front of us. We have a proven strategy, we have proven execution, and we have proven results, all leading to higher 2030 targets. I said earlier in the presentation, and I hope you all agree with me now, that I've never been more excited about Tyler's future or more confident in our future than I am today. Again, thanks for joining us. I do hope you found it informative. There's a survey online, and there's a QR code that people can access. I think it's available for about five days. It only takes a few minutes to fill out. We'd really appreciate your feedback. Your feedback's really important. It really helped shape this investor day, the feedback we got three years ago. If you have a minute, please take the time to do so. Again, thanks everybody for the day, and thanks for your interest in Tyler Technologies. Thanks.