i3 Verticals (IIIV) opened Q1 2026 with total revenue of US$52.7 million and basic EPS of US$0.03, with net income from continuing operations of US$0.6 million and a current share price around US$22.91 framing how the latest quarter lands for investors. Over recent periods the company has seen quarterly revenue move between US$46.2 million and US$54.9 million, while basic EPS has ranged from a loss of US$0.58 to a profit of US$0.54. This print sits in the middle of what has been a wide earnings range and puts the focus squarely on how efficiently those revenues are being converted into profits.

See our full analysis for i3 Verticals.

With the headline numbers on the table, the next step is to see how this earnings profile lines up with the key narratives around growth, risks, and improving margins that investors have been watching.

Recurring revenue mix supports TTM profitability

• Over the last 12 months, i3 Verticals generated US$213.6 million of revenue and US$2.5 million of net income from continuing operations, with annual recurring revenue at US$169.6 million and 80% of quarterly revenue tied to recurring sources.
• Consensus narrative points to recurring public sector software as the backbone of earnings, and the numbers partly back that up while also showing some friction:
  • TTM revenue moved from US$188.4 million a year ago to US$213.6 million, alongside a turn into profitability at US$2.5 million of net income from continuing operations and TTM EPS of US$0.10.
  • At the same time, Q1 2026 adjusted EBITDA margin of 25.8% compares with 27.9% a year earlier, and adjusted EBITDA for the quarter was US$13.6 million against Q1 2025’s US$14.6 million. This indicates that the push toward more recurring SaaS is not yet translating into higher near term margins.

One off items and past losses still in the rearview

• Trailing 12 month earnings include a US$1.9 million one off gain and sit against a five year earnings history that averages 21.4% annual contraction, even though the company is now profitable on US$2.5 million of net income and US$0.10 of EPS.
• Bears argue that relying on special items and a mixed earnings record makes the story look fragile, and the recent figures give some support to that caution:
  • Discontinued operations swung from US$124.2 million in Q4 2024 to US$13.8 million over the latest TTM period, and Q1 2026 discontinued operations were a loss of US$0.1 million, so a big historic tailwind from disposals is no longer present.
  • Within the last six quarters, basic EPS has ranged from a loss of US$0.58 in Q3 2024 to a profit of US$0.54 in Q4 2024, and Q1 2026 EPS of roughly US$0.03 shows that quarterly profitability can move around a lot even as the company reports being profitable over the year.

On a set of results where one off gains are fading and the business has only recently moved into the black, skeptics think it is worth stress testing whether the current profit run rate can absorb bumps in public sector spending before margins come under pressure again, especially with the share price around US$22.91 and analyst targets centered near US$31.33. 🐻 i3 Verticals Bear Case

Valuation discount versus peers as growth forecasts diverge

• The stock trades on a P/S of 2.4x against 3.4x for peers and 3.7x for the wider US software group, while analysts in the data expect earnings growth of about 48.2% per year and revenue growth around 8% per year, compared with a broader US market revenue growth forecast of 11.4%.
• Bullish investors point to this mix of lower P/S and higher forecast earnings growth as a positive setup, and the earnings profile offers some evidence for that view:
  • On a TTM basis, profits have moved into positive territory at US$2.5 million after periods of losses such as the US$55.0 million loss from continuing operations in the TTM window ending Q3 2025, so the starting point for those growth forecasts is a small profit base.
  • With the share price at about US$22.91 and analyst price targets in the narratives clustered around US$31.33, the current multiple on sales sits below peer and sector averages even as analysts in the balanced view expect margins to rise from about 1.2% today to 8.0% within three years.

For readers weighing whether that lower P/S alongside higher forecast earnings growth justifies a closer look at the optimistic case, it can help to walk through how recurring revenue, SaaS growth and acquisitions would need to perform relative to these forecasts to support a higher share price over time. 🐂 i3 Verticals Bull Case

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for i3 Verticals on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

Given the mix of cautious and optimistic signals in these results, it makes sense to act now and test the story against the numbers yourself. You can start with the 2 key rewards and 2 important warning signs.

See What Else Is Out There

i3 Verticals is only just profitable with thin margins, uneven quarterly EPS and some reliance on one off gains, which can leave earnings feeling fragile.

If that earnings volatility makes you uneasy, it could be worth checking stocks with more resilient profiles using the 72 resilient stocks with low risk scores while you compare alternatives.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.