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| Share Name | Share Symbol | Market | Type |
|---|---|---|---|
| ACI Worldwide Inc | NASDAQ:ACIW | NASDAQ | Common Stock |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| -0.04 | -0.07% | 53.50 | 53.30 | 54.00 | 54.05 | 53.07 | 53.07 | 411,347 | 22:05:10 |
From Sep 2024 to Mar 2025
Q3 2024 HIGHLIGHTS
ACI Worldwide (NASDAQ: ACIW), an original innovator in global payments technology, announced financial results today for the quarter ended September 30, 2024.
“We are very pleased with our third quarter results and the continued positive momentum in the business. We saw particular strength within our Bank and Merchant segments and are once again raising our full-year outlook,” said Thomas Warsop, president and CEO of ACI Worldwide. “This year the team has done a tremendous job signing renewal contracts earlier in the year. This initiative is enabling our commercial team to spend more time on prospects and winning new business, which has allowed us to outperform our forecasts. Further, signing these new contracts earlier in the year helps reduce the heavy seasonality we have historically seen and simply reduces the risk of attaining our full-year financial guidance.
“Our pipelines remain strong across our segments, and we are well-positioned for future growth as we continue to invest in innovation, execute on our strategy, and deliver value to our customers and shareholders.”
“Our cash flow from operating activities increased 114% over Q3 last year and we exited the quarter with net debt leverage ratio of 1.6x adjusted EBITDA, with approximately $650 million in liquidity,” said Scott Behrens, chief financial officer of ACI Worldwide. “Our strong cash flow growth and our lowest leverage in over a decade, combined with our improved outlook for 2024 and our expectations for continued strength in 2025, enable us to reduce our long-term stated leverage target from 2.5x to 2.0x. We will continue to maintain a disciplined, long-term focused capital allocation strategy that balances re-investment in the business, accretive M&A and share repurchases, while maintaining a strong balance sheet with ample liquidity and financial flexibility.”
FINANCIAL SUMMARY
In Q3 2024, revenue was $452 million, up 24% from Q3 2023. Net income was $81 million, up 115% from $38 million in Q3 2023. Adjusted EBITDA in Q3 2024 was $167 million, up 61% from Q3 2023. Cash flow from operating activities in Q3 2024 was $54 million, up 114% from $25 million in Q3 2023.
ACI ended Q3 2024 with $178 million in cash on hand and a debt balance of $1 billion, which represents a net debt leverage ratio of 1.6x adjusted EBITDA.
During the quarter the company repurchased approximately 200,000 shares for $8 million in capital and year-to-date 2024 has repurchased approximately 4 million shares for $128 million in capital. At the end of the quarter, the company had $372 million remaining available on the share repurchase authorization.
RAISING 2024 GUIDANCE
For the full year of 2024, we are raising our guidance for both revenue and adjusted EBITDA. We now expect revenue to be in the range of $1.567 billion to $1.601 billion, up from the range of $1.557 billion to $1.591 billion. We now expect adjusted EBITDA to be in the range of $433 million to $448 million, up from the range of $423 million to $438 million.
CONFERENCE CALL TO DISCUSS FINANCIAL RESULTS
Today, management will host a conference call at 8:30 a.m. ET to discuss these results. Interested persons may access a real-time audio broadcast of the teleconference at http://investor.aciworldwide.com/ or use the following number for dial-in participation: toll-free 1 (888) 660-6377 and conference code 3153574.
About ACI Worldwide
ACI Worldwide, an original innovator in global payments technology, delivers transformative software solutions that power intelligent payments orchestration in real time so banks, billers, and merchants can drive growth, while continuously modernizing their payment infrastructures, simply and securely. With nearly 50 years of trusted payments expertise, we combine our global footprint with a local presence to offer enhanced payment experiences to stay ahead of constantly changing payment challenges and opportunities.
© Copyright ACI Worldwide, Inc. 2024.
ACI, ACI Worldwide, ACI Payments, Inc., ACI Pay, Speedpay and all ACI product/solution names are trademarks or registered trademarks of ACI Worldwide, Inc., or one of its subsidiaries, in the United States, other countries or both. Other parties' trademarks referenced are the property of their respective owners.
To supplement our financial results presented on a GAAP basis, we use the non-GAAP measures indicated in the tables, which exclude significant transaction-related expenses, as well as other significant non-cash expenses such as depreciation, amortization, and stock-based compensation, that we believe are helpful in understanding our past financial performance and our future results. The presentation of these non-GAAP financial measures should be considered in addition to our GAAP results and are not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management generally compensates for limitations in the use of non-GAAP financial measures by relying on comparable GAAP financial measures and providing investors with a reconciliation of non-GAAP financial measures only in addition to and in conjunction with results presented in accordance with GAAP.
We believe that these non-GAAP financial measures reflect an additional way to view aspects of our operations that, when viewed with our GAAP results, provide a more complete understanding of factors and trends affecting our business. Certain non-GAAP measures include:
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements based on current expectations that involve a number of risks and uncertainties. Generally, forward-looking statements do not relate strictly to historical or current facts and may include words or phrases such as “believes,” “will,” “expects,” “anticipates,” “intends,” and words and phrases of similar impact. The forward-looking statements are made pursuant to safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements in this press release include, but are not limited to: (i) the continued positive momentum in the business, (ii) our pipelines remain strong across our segments, and we are well-positioned for future growth as we continue to invest in innovation, execute on our strategy, and deliver value to our customers and shareholders, (iii) we will continue to maintain a disciplined, long-term focused capital allocation strategy that balances re-investment in the business, accretive M&A and share repurchases, while maintaining a strong balance sheet with ample liquidity and financial flexibility (iv) target leverage and full-year 2024 revenue and adjusted EBITDA financial guidance.
All of the foregoing forward-looking statements are expressly qualified by the risk factors discussed in our filings with the Securities and Exchange Commission. Such factors include, but are not limited to, increased competition, business interruptions or failure of our information technology and communication systems, security breaches or viruses, our ability to attract and retain senior management personnel and skilled technical employees, future acquisitions, strategic partnerships and investments, divestitures and other restructuring activities, implementation and success of our strategy, impact if we convert some or all on-premise licenses from fixed-term to subscription model, anti-takeover provisions, exposure to credit or operating risks arising from certain payment funding methods, customer reluctance to switch to a new vendor, our ability to adequately defend our intellectual property, litigation, consent orders and other compliance agreements, our offshore software development activities, risks from operating internationally, including fluctuations in currency exchange rates, events in eastern Europe and the Middle East, adverse changes in the global economy, compliance of our products with applicable legislation, governmental regulations and industry standards, the complexity of our products and services and the risk that they may contain hidden defects, complex regulations applicable to our payments business, our compliance with privacy and cybersecurity regulations, exposure to unknown tax liabilities, changes in tax laws and regulations, consolidations and failures in the financial services industry, volatility in our stock price, demand for our products, failure to obtain renewals of customer contracts or to obtain such renewals on favorable terms, delay or cancellation of customer projects or inaccurate project completion estimates, impairment of our goodwill or intangible assets, the accuracy of management’s backlog estimates, the cyclical nature of our revenue and earnings and the accuracy of forecasts due to the concentration of revenue-generating activity during the final weeks of each quarter, restrictions and other financial covenants in our debt agreements, our existing levels of debt, events outside of our control including natural disasters, wars, and outbreaks of disease, and revenues or revenue mix. For a detailed discussion of these risk factors, parties that are relying on the forward-looking statements should review our filings with the Securities and Exchange Commission, including our most recently filed Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q.
ACI WORLDWIDE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands)
September 30, 2024
December 31, 2023
ASSETS
Current assets
Cash and cash equivalents
$
177,860
$
164,239
Receivables, net of allowances
424,518
452,337
Settlement assets
428,479
723,039
Prepaid expenses
31,878
31,479
Other current assets
22,865
35,551
Total current assets
1,085,600
1,406,645
Noncurrent assets
Accrued receivables, net
338,977
313,983
Property and equipment, net
31,441
37,856
Operating lease right-of-use assets
29,181
34,338
Software, net
90,313
108,418
Goodwill
1,226,026
1,226,026
Intangible assets, net
172,310
195,646
Deferred income taxes, net
64,674
58,499
Other noncurrent assets
54,463
63,328
TOTAL ASSETS
$
3,092,985
$
3,444,739
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable
$
47,912
$
45,964
Settlement liabilities
428,080
721,164
Employee compensation
42,806
53,892
Current portion of long-term debt
34,910
74,405
Deferred revenue
68,550
59,580
Other current liabilities
75,036
82,244
Total current liabilities
697,294
1,037,249
Noncurrent liabilities
Deferred revenue
19,315
24,780
Long-term debt
959,387
963,599
Deferred income taxes, net
38,439
40,735
Operating lease liabilities
23,601
29,074
Other noncurrent liabilities
25,319
25,005
Total liabilities
1,763,355
2,120,442
Commitments and contingencies
Stockholders’ equity
Preferred stock
—
—
Common stock
702
702
Additional paid-in capital
725,724
712,994
Retained earnings
1,499,530
1,394,967
Treasury stock
(791,353
)
(674,896
)
Accumulated other comprehensive loss
(104,973
)
(109,470
)
Total stockholders’ equity
1,329,630
1,324,297
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$
3,092,985
$
3,444,739
ACI WORLDWIDE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited and in thousands, except per share amounts)
Three Months Ended September 30,
Nine Months Ended September 30,
2024
2023
2024
2023
Revenues
Software as a service and platform as a service
$
223,367
$
211,369
$
674,498
$
625,975
License
157,429
79,679
252,984
142,681
Maintenance
47,559
51,942
144,046
153,436
Services
23,397
20,025
69,722
53,924
Total revenues
451,752
363,015
1,141,250
976,016
Operating expenses
Cost of revenue (1)
197,351
177,625
591,696
537,522
Research and development
37,660
33,739
108,063
106,122
Selling and marketing
28,691
29,442
83,992
98,166
General and administrative
33,949
29,821
84,942
92,675
Depreciation and amortization
31,515
30,464
86,710
93,439
Total operating expenses
329,166
301,091
955,403
927,924
Operating income
122,586
61,924
185,847
48,092
Other income (expense)
Interest expense
(18,356
)
(19,840
)
(55,837
)
(58,641
)
Interest income
3,871
3,495
11,833
10,458
Other, net
(823
)
1,084
(1,692
)
(6,403
)
Total other income (expense)
(15,308
)
(15,261
)
(45,696
)
(54,586
)
Income (loss) before income taxes
107,278
46,663
140,151
(6,494
)
Income tax expense (benefit)
25,851
8,752
35,588
(5,387
)
Net income (loss)
$
81,427
$
37,911
$
104,563
$
(1,107
)
Income (loss) per common share
Basic
$
0.78
$
0.35
$
0.99
$
(0.01
)
Diluted
$
0.77
$
0.35
$
0.98
$
(0.01
)
Weighted average common shares outstanding
Basic
104,770
108,667
105,651
108,428
Diluted
106,018
108,933
106,552
108,428
(1) The cost of revenue excludes charges for depreciation and amortization.
ACI WORLDWIDE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited and in thousands)
Three Months Ended September 30,
Nine Months Ended September 30,
2024
2023
2024
2023
Cash flows from operating activities:
Net income (loss)
$
81,427
$
37,911
$
104,563
$
(1,107
)
Adjustments to reconcile net income (loss) to net cash flows from operating activities:
Depreciation
7,804
5,631
14,999
18,722
Amortization
23,711
24,832
71,711
74,716
Amortization of operating lease right-of-use assets
2,338
2,699
7,337
9,190
Amortization of deferred debt issuance costs
659
923
2,257
3,415
Deferred income taxes
(3,745
)
(2,566
)
(2,229
)
(25,207
)
Stock-based compensation expense
11,346
6,822
30,165
17,537
Other
2,247
1,857
180
2,168
Changes in operating assets and liabilities:
Receivables
(95,899
)
(39,844
)
3,699
42,012
Accounts payable
(4,091
)
(5,244
)
758
(7,198
)
Accrued employee compensation
8,759
1,749
(11,125
)
(2,879
)
Deferred revenue
(6,433
)
(8,296
)
1,884
4,404
Other current and noncurrent assets and liabilities
25,885
(1,208
)
8,067
(52,999
)
Net cash flows from operating activities
54,008
25,266
232,266
82,774
Cash flows from investing activities:
Purchases of property and equipment
(3,509
)
(3,380
)
(8,463
)
(7,956
)
Purchases of software and distribution rights
(4,154
)
(7,550
)
(23,178
)
(22,571
)
Net cash flows from investing activities
(7,663
)
(10,930
)
(31,641
)
(30,527
)
Cash flows from financing activities:
Proceeds from issuance of common stock
732
696
2,129
2,122
Proceeds from exercises of stock options
1,202
263
1,954
3,132
Repurchase of stock-based compensation awards for tax withholdings
(2,960
)
(883
)
(9,299
)
(4,203
)
Repurchases of common stock
(7,996
)
—
(127,670
)
—
Proceeds from revolving credit facility
20,000
20,000
184,000
75,000
Repayment of revolving credit facility
(25,000
)
(6,000
)
(177,000
)
(51,000
)
Proceeds from term portion of credit agreement
—
—
500,000
—
Repayment of term portion of credit agreement
(9,375
)
(19,475
)
(547,823
)
(53,556
)
Payments on or proceeds from other debt, net
(630
)
(643
)
(9,299
)
(12,473
)
Payments for debt issuance costs
—
—
(5,141
)
(2,160
)
Net increase (decrease) in settlement assets and liabilities
23,855
19,452
17,704
(4,635
)
Net cash flows from financing activities
(172
)
13,410
(170,445
)
(47,773
)
Effect of exchange rate fluctuations on cash
(1,621
)
(1,039
)
(331
)
4,388
Net increase in cash and cash equivalents
44,552
26,707
29,849
8,862
Cash and cash equivalents, including settlement deposits, beginning of period
224,118
196,827
238,821
214,672
Cash and cash equivalents, including settlement deposits, end of period
$
268,670
$
223,534
$
268,670
$
223,534
Reconciliation of cash and cash equivalents to the Consolidated Balance Sheets
Cash and cash equivalents
$
177,860
$
139,520
$
177,860
$
139,520
Settlement deposits
90,810
84,014
90,810
84,014
Total cash and cash equivalents
$
268,670
$
223,534
$
268,670
$
223,534
Three Months Ended September 30,
Nine Months Ended September 30,
Adjusted EBITDA (millions)
2024
2023
2024
2023
Net income (loss)
$
81.4
$
37.9
$
104.6
$
(1.1
)
Plus:
Income tax expense (benefit)
25.9
8.7
35.6
(5.4
)
Net interest expense
14.5
16.4
44.0
48.2
Net other (income) expense
0.8
(1.1
)
1.7
6.4
Depreciation expense
7.8
5.6
15.0
18.7
Amortization expense
23.7
24.8
71.7
74.7
Non-cash stock-based compensation expense
11.3
6.8
30.2
17.5
Adjusted EBITDA before significant transaction-related expenses
$
165.4
$
99.1
$
302.8
$
159.0
Significant transaction-related expenses:
Cost reduction strategies
1.2
3.8
4.3
19.7
European datacenter migration
—
0.4
—
2.6
Other
0.3
0.1
1.0
4.4
Adjusted EBITDA
$
166.9
$
103.4
$
308.1
$
185.7
Revenue, net of interchange:
Revenue
$
451.8
$
363.0
$
1,141.3
$
976.0
Interchange
117.1
102.7
353.6
315.0
Revenue, net of interchange
$
334.7
$
260.3
$
787.7
$
661.0
Net Adjusted EBITDA Margin
50
%
40
%
39
%
28
%
Three Months Ended September 30,
Nine Months Ended September 30,
Segment Information (millions)
2024
2023
2024
2023
Revenue
Banks
$
222.0
$
155.7
$
471.1
$
361.2
Merchants
50.2
36.3
123.9
107.6
Billers
179.6
171.0
546.3
507.2
Total
$
451.8
$
363.0
$
1,141.3
$
976.0
Recurring Revenue
Banks
$
55.6
$
58.2
$
167.1
$
171.2
Merchants
35.7
34.1
105.1
101.0
Billers
179.6
171.0
546.3
507.2
Total
$
270.9
$
263.3
$
818.5
$
779.4
Segment Adjusted EBITDA
Banks
$
153.9
$
91.0
$
274.8
$
167.3
Merchants
26.7
10.3
52.7
26.8
Billers
30.9
39.2
99.1
100.1
Note: Amounts may not recalculate due to rounding.
Three Months Ended September 30,
2024
2023
EPS Impact of Non-cash and Significant Transaction-related Items (millions)
EPS Impact
$ in Millions
(Net of Tax)
EPS Impact
$ in Millions
(Net of Tax)
GAAP net income
$
0.77
$
81.4
$
0.35
$
37.9
Adjusted for:
Significant transaction-related expenses
0.04
4.5
0.03
3.3
Amortization of acquisition-related intangibles
0.05
5.4
0.06
6.4
Amortization of acquisition-related software
0.03
3.4
0.03
3.8
Non-cash stock-based compensation
0.08
8.6
0.05
5.2
Total adjustments
$
0.20
$
21.9
$
0.17
$
18.7
Diluted EPS adjusted for non-cash and significant transaction-related items
$
0.97
$
103.3
$
0.52
$
56.6
Nine Months Ended September 30,
2024
2023
EPS Impact of Non-cash and Significant Transaction-related Items (millions)
EPS Impact
$ in Millions
(Net of Tax)
EPS Impact
$ in Millions
(Net of Tax)
GAAP net income (loss)
$
0.98
$
104.6
$
(0.01
)
$
(1.1
)
Adjusted for:
Significant transaction-related expenses
0.07
7.4
0.19
20.4
Amortization of acquisition-related intangibles
0.17
18.1
0.18
19.3
Amortization of acquisition-related software
0.09
10.1
0.11
12.0
Non-cash stock-based compensation
0.21
22.9
0.12
13.3
Total adjustments
$
0.54
$
58.5
$
0.60
$
65.0
Diluted EPS adjusted for non-cash and significant transaction-related items
$
1.52
$
163.1
$
0.59
$
63.9
Three Months Ended
September 30,
Nine Months Ended
September 30,
Recurring Revenue (millions)
2024
2023
2024
2023
SaaS and PaaS fees
$
223.4
$
211.4
$
674.5
$
626.0
Maintenance fees
47.5
51.9
144.0
153.4
Recurring Revenue
$
270.9
$
263.3
$
818.5
$
779.4
New Bookings (millions)
Three Months Ended
September 30,
TTM Ended September 30,
2024
2023
2024
2023
Annual recurring revenue (ARR) bookings
$
11.1
$
20.5
$
59.3
$
84.9
License and services bookings
67.0
54.1
281.5
224.5
Note: Amounts may not recalculate due to rounding.
View source version on businesswire.com: https://www.businesswire.com/news/home/20241107430137/en/
For more information contact: Investor Relations John Kraft SVP, Head of Strategy and Finance 239-403-4627 / john.kraft@aciworldwide.com
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