Temenos (TEMN) Q1 2026 earnings summary

Executive summary

• Achieved strong Q1 2026 performance with double-digit growth in ARR, product revenue, and profitability, continuing momentum from 2025.

• Stable sales environment with significant deal wins across geographies and customer tiers, especially in Middle East, Africa, and the U.S.

• Continued investment in strategic roadmap, technology, and senior hires, including the appointment of Daniel Schmucki as CFO effective August 2026.

• Operational leverage and cost efficiencies contributed to improved margins and profitability.

• FY-26 guidance and FY-28 targets reconfirmed, reflecting confidence in ongoing growth and strategic positioning.

Financial highlights

• Q1-26 ARR grew 13% year-over-year to $861m (non-IFRS, constant currency, proforma), despite headwinds from a BNPL client offboarding.

• Product revenue increased 14% year-over-year to $219m; total revenue up 13% to $253m (non-IFRS, constant currency, proforma).

• Subscription and SaaS revenue grew 12% to $87m; maintenance revenue up 15% to $132m.

• Non-IFRS EBIT rose 20% to $83m; non-IFRS EPS up 20% to $0.90.

• Free cash flow reached $60m, up 22% year-over-year.

Outlook and guidance

• FY-26 guidance reconfirmed: ARR growth ~12%, Subscription and SaaS ~9%, EBIT ~9%, EPS ~7%, FCF ~16%.

• FY-28 targets reaffirmed: ARR >$1.23bn, EBIT ~$480m, FCF ~$410m.

• Guidance includes remaining headwind from a terminated BNPL client, with no further impact after FY-26.

• FY-26 tax rate expected at 19-21%.

• Prudent approach to guidance maintained due to macro uncertainties; Q1 is typically the smallest quarter.