Rob Oliver: Great. Thanks for the color. Appreciate it.
Operator: Thank you for your question. Our next question is from the line of Terry Tillman with Truist Securities. Your line is live.
Connor Passarella: Great. Good morning. This is Connor Passarella on for Terry. Appreciate you taking the question. Just curious on the payments business and how we should be thinking about organic growth going forward in that segment. And then also just on the payment disbursement use cases that have progressed since the acquisition of Rapid Financial last year. Thank you.
Lynn Moore: I’ll start with the use cases. Right now, Rapid, when we bought them, they were primarily in the court space, and that’s our primary focus right now. We’re in the process. We’re early in our 2024 budgeting, thinking about the investments and the various other disbursement cases that we want to put our money towards. So I’m not going to give you our R&D time line right now or our priorities, but we’re in the process of doing that. We — as we’ve talked before, I think the opportunities across the Tyler solutions is pretty expansive on the disbursement side. We’ve talked before, I think, as big as on the acquiring side. But currently, right now, the focus is primarily still in the courts area.
A –Brian Miller : Yes. And on the expectations for growth rates around payments, at Investor Day, we broadly talked about an expectation of transaction revenues growing in the 10% to 13% range and expanding margins there over the next several years. As we’ve said, we’re in the very early innings of executing on the cross-sell opportunity of driving payments more deeply into our local government customer base. And so we’re still ramping that up, seeing good success in expanding those numbers of new deals each quarter. But generally, that 10% to 13% CAGR for transaction revenues is our expectation over the next few years.
Connor Passarella: Great. Thank you.
Operator: Thank you for your question. Our next question is from the line of Alex Zukin with Wolfe Research. Your line is live.
Alex Zukin: Hey, guys. Thanks for taking my question. I guess maybe just two quick ones for me. Bookings look like it took a step up this quarter after the last — particularly over the last couple of quarters. So I wanted to just understand the outperformance there. Is that accomplished year or incremental momentum? And then same question. Obviously, cash flow looked like it meaningfully outperformed, at least our estimates and I think consensus. So just an understanding of was there anything onetime there? And how should we think about it for Q4? And then just any color, Brian, on the specific elements around some of the cloud — or SaaS statement? This quarter, what drove that? And how should we think about that going forward?
A –Brian Miller : Yes. So a couple of things there. Cash flow, most of the outperformance was — you see it in the working capital side and just really strong collections around our revenues driving good performance around our receivables. I think we’re continuing to see the impact of more and more recurring revenues and the positive cash flow characteristics around that. Not really any onetime things there. But I think that our expectation for the year has ratcheted up a little bit. I think right now, even after the impact of the Section 174 cash taxes, which the biggest impact was in the first half of the year, I think we said there’s a $22 million impact on cash taxes this quarter, back around the $15 million incremental taxes in Q4.
But I think our expectation for the full year now is more in the $220 million to $240 million range for free cash flow, which is up from where we thought last quarter. We did make some minor reclasses in the historical data, the split between — in subscription, so all in the subscription category on the face of our income statement. But in the breakout of those, between transaction revenues and SaaS revenues. As we transition to a new financial system this quarter, we had better clarity on some of the mapping of the revenues, primarily from acquisitions since NIC and reclassified those somewhat between transactions and SaaS. So we’ve just sort of cleaned up some of those historical numbers. Don’t expect any more changes going forward.
