Alkami Technology NASDAQ: ALKT reported third-quarter 2026 revenue and adjusted EBITDA above its guidance range, while raising its full-year outlook. Executives said recurring subscription revenue, customer expansion and new client launches supported growth, though uncertainty related to the company’s strategic review weighed on some new-logo decisions during the year.
Third-quarter revenue increased 19% year over year to $134.9 million, above the high end of the company’s prior outlook. Subscription revenue rose 20% and accounted for 96% of total revenue. Adjusted EBITDA was $26.3 million, producing a 19.5% margin and expanding more than 530 basis points from a year earlier.
Chief Financial Officer Cassandra Hudson said results benefited from new customers going live, expansion among existing customers, an easier prior-year comparison, and higher-than-expected third-party product and core-conversion revenue. Alkami generated nearly $22 million in operating cash flow during the quarter and ended the period with $85 million in cash and marketable securities.
Raised Full-Year Outlook
For the fourth quarter, Alkami forecast revenue of $139.7 million to $141.2 million, representing growth of 15.6% to 16.9%, and adjusted EBITDA of $30 million to $31 million. The midpoint of that EBITDA outlook implies a 21.7% margin.
Hudson said the fourth-quarter outlook reflects the timing of certain one-time revenue that was recognized during the third quarter rather than the fourth quarter, along with somewhat higher third-party costs associated with product mix. She said these factors did not alter the company’s view of the full year.
- Full-year revenue is now expected to be $530.5 million to $532 million, representing growth of 19.6% to 19.9%.
- Full-year adjusted EBITDA is expected to be $98 million to $99 million, or an 18.5% margin at the midpoint.
- Stock-based compensation is expected to be less than 14% of revenue.
The company continues to expect more than 500 basis points of margin expansion for the full year, driven by operating leverage and cost discipline. Hudson said Alkami would provide its complete 2027 outlook when it reports fourth-quarter results, but added that management expects to sharpen its focus on profitability next year.
Alkami’s longer-term “Rule of 45” target for 2030 assumes gross margin approaching 70%, approximately 300 basis points of annual adjusted EBITDA margin expansion, and stock-based compensation below 10% of revenue, according to Hudson.
Customer Growth, Backlog and Sales Activity
Chief Executive Officer Alex Shootman said Alkami signed five new digital banking relationships during the quarter, including three banks and two credit unions. Two of those customers also contracted for the company’s Digital Sales and Service Platform, or DSSP, which combines digital banking, account opening, and data and marketing products.
The company has signed 16 digital banking new logos year to date, compared with an average of 21 through the third quarter since it became a public company. Alkami also signed 14 new MANTL clients during the quarter, while five additional clients contracted for all three DSSP products. The number of customers contracted for the full DSSP offering reached 60.
Alkami said it now has 544 unique clients contracted for either digital banking or MANTL, including 86 contracted for both platforms. It exited the quarter with 323 live digital banking clients and 24.4 million registered users, up 2.8 million users, or 13%, year over year.
Live annual recurring revenue rose 19% to $533 million. The company reported approximately $56 million of ARR backlog, representing 31 clients and about 1 million digital users, with most of that backlog expected to go live during the next 12 months. Average ARR per client reached roughly $1.7 million, while 56 customers generated at least $2 million in ARR, up from 18 customers at the end of 2021.
Average revenue per user rose 5% year over year to $21.88. Hudson attributed the increase primarily to cross-selling, growing adoption by current clients and a greater contribution from banks, which tend to onboard at higher ARPUs than credit unions because of their commercial-to-retail mix.
Shootman said the company’s sales pipeline remained consistent with historical levels, but public speculation surrounding Alkami’s future ownership created uncertainty among prospective customers considering long-term digital banking contracts. Alkami announced in September that its board unanimously concluded that executing its long-range plan as an independent public company was the best path to maximize shareholder value.
“When faced with making a strategic multi-year decision,” Shootman said on the call, customers could choose another provider when there was uncertainty around Alkami’s ownership. He said management believes the conclusion of the strategic review should help remove that concern, though he declined to forecast the timing of a recovery in new-logo bookings.
Implementation and Margin Considerations
Alkami completed seven core banking conversions so far this year, a record for the company, including six of its largest clients representing more than 3.5 million digital users. Shootman said the company expects to nearly double that number next year. During the third quarter, Alkami brought 10 digital banking clients and 26 MANTL clients live. It also launched four digital banking customers in one day last week, with five more launches scheduled over the following 12 business days.
Third-quarter gross margin was 63.1%, below management’s expectations, primarily because of higher third-party product costs. Hudson said roughly one-third of Alkami’s revenue comes from third-party products integrated into its platform, causing margins to fluctuate with sales mix. The company expects the product-mix impact to continue into the fourth quarter.
Hudson said a roughly $800,000 timing shift, largely tied to core-conversion work, moved revenue expected in the fourth quarter into the third quarter. The timing of those projects can vary as customers complete testing and determine when to execute their conversions.
AI Product Strategy
Shootman outlined Alkami’s plans to develop artificial intelligence capabilities both within financial institutions’ digital banking applications and through connectors to general-purpose AI assistants. He said the company is developing an agentic conversational experience designed to help users identify potential cash shortfalls, move funds or prepare debt-paydown actions subject to institutional policies and approvals.
Alkami is also testing three AI agents in its onboarding and account-opening platform: a KYC agent that summarizes manual reviews and recommends a disposition, a document-review agent that identifies mismatches in borrower documentation, and an MCP server that allows financial institutions to ask questions using AI assistants grounded in their own application and account data.
About 10% of Alkami’s revenue currently comes from AI products already in its portfolio, including fraud-management offerings, Shootman said. Management said client interest includes using AI to improve internal operations as well as creating new applications that combine data analysis and workflow management, particularly for fraud prevention.
About Alkami Technology (NASDAQ:ALKT)
Alkami Technology, Inc provides cloud-based digital banking solutions for financial institutions, primarily community banks and credit unions in the United States. Its platform is designed to help institutions deliver digital experiences across online and mobile channels while managing customer relationships and banking operations.
The company's products and services include digital account opening, online and mobile banking, payments, money movement, card management, financial wellness tools, data and analytics, marketing capabilities, and fraud prevention.
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