United States

Other

- Americas - Other

- EMEA

- Asia Pacific

Total Revenue

9dd09dee2ba2484846c7d31b8af471629da8d3759cbb737e771538f91f973901

1. With your strong overperformance in 2024, particularly due to pulling forward license renewals, how do you plan to sustain revenue growth in 2025, and what gives you confidence that growth rates can continue despite tougher comparisons?
2. You indicated that Payment Hub pilot implementations are expected in the second quarter of next year; can you provide more detail on when the Payment Hub will be generally available and how it's factored into your 2025 growth expectations?
3. Given that the strength in the Banks segment is driven by large banks with on-premise licenses, what strategies are you employing to accelerate growth among mid-tier banks through SaaS offerings, and how significant is this opportunity in your medium-term growth plan?
4. As competition in Real-Time Payments intensifies, how do you plan to maintain your competitive edge, and are you seeing any pricing pressure or changes in the competitive environment that could impact your growth in this space?
5. With your significant investments in the Payments Hub and AI initiatives, how are you balancing the associated costs with the need to maintain or improve EBITDA margins, and when do you expect to see a return on these investments?

ae561461bfeadde37293d983b3879a45dec1dbb79c8e2d164d80e2dfe0957d31

| Program Details          | Program 1          |
|--------------------------|--------------------|
| **Approval Date**        | **2005**  **[0000935036-24-000038_aciw-20240930.htm:39]** **[0000935036-24-000038_aciw-20240930.htm:46]** **[0000935036-24-000038_aciw-20240930.htm:16]**  |
| **End Date/Duration**    | N/A  **[0000935036-24-000038_aciw-20240930.htm:39]** **[0000935036-24-000038_aciw-20240930.htm:46]** **[0000935036-24-000038_aciw-20240930.htm:16]**       |
| **Total Additional Amount** | **$400.0 million** (June 2024)  **[0000935036-24-000038_aciw-20240930.htm:39]** **[0000935036-24-000038_aciw-20240930.htm:46]** **[0000935036-24-000038_aciw-20240930.htm:16]**  |
| **Remaining Authorization** | **$372.3 million** (as of 2024-09-30)  **[0000935036-24-000038_aciw-20240930.htm:39]** **[0000935036-24-000038_aciw-20240930.htm:46]** **[0000935036-24-000038_aciw-20240930.htm:16]**  |
| **Details**              | Repurchases depend on factors like working capital needs, acquisitions, debt obligations, stock price, and market conditions. Can be conducted via open market or Rule 10b5-1 plan. Flexible to suspend or discontinue.  **[0000935036-24-000007_aciw-20231231.htm:62]** **[0000935036-23-000009_aciw-20221231.htm:59]** **[0000935036-24-000030_aciw-20240630.htm:38]** **[0000935036-24-000018_aciw-20240331.htm:32]** **[0000935036-24-000038_aciw-20240930.htm:39]**  |

dbfae62a0b54d871ff055185f6dc4c11cf425111ec582f1080f9746caf3e79ab

44c63dae3b0f721126c55d18fac27f439aa423440d46655f4eca0d4adb4a0ca0

ACI Worldwide, Inc. (ACIW) is a global leader in electronic payment solutions, enabling secure and real-time digital transactions for over 6,000 organizations, including some of the largest banks, merchants, and intermediaries. The company offers a comprehensive suite of software products and services that facilitate payments and securities transactions, processing approximately $14 trillion daily. ACI Worldwide's solutions are delivered through on-premises installations, public cloud, or its private cloud, catering to a wide range of customers across various industries.  **[0000935036-24-000007_aciw-20231231.htm:46]** **[0000935036-24-000018_aciw-20240331.htm:20]** **[0000935036-24-000038_aciw-20240930.htm:24]** **[0000935036-24-000030_aciw-20240630.htm:22]** **[0000935036-23-000039_aciw-20230930.htm:23]** **[0000935036-23-000009_aciw-20221231.htm:45]** **[0000935036-23-000031_aciw-20230630.htm:23]** **[0000935036-23-000019_aciw-20230331.htm:20]** **[0000935036-24-000007_aciw-20231231.htm:93]** 

1. **Billers** - Provides electronic bill presentment and payment services, enabling businesses to streamline billing processes and offer customers flexible payment options.  **[0000935036-24-000007_aciw-20231231.htm:119]** **[0000935036-24-000007_aciw-20231231.htm:46]** **[0000935036-24-000018_aciw-20240331.htm:20]** **[0000935036-24-000038_aciw-20240930.htm:24]** **[0000935036-24-000030_aciw-20240630.htm:22]** **[0000935036-23-000039_aciw-20230930.htm:23]** **[0000935036-23-000009_aciw-20221231.htm:45]** **[0000935036-23-000031_aciw-20230630.htm:23]** **[0000935036-23-000019_aciw-20230331.htm:20]** **[0000935036-24-000007_aciw-20231231.htm:93]** 
2. **Banks** - Offers real-time payment capabilities and omni-channel payment solutions to financial institutions, supporting transactions across ATMs, POS terminals, mobile devices, and internet commerce sites.  **[0000935036-24-000007_aciw-20231231.htm:119]** **[0000935036-24-000007_aciw-20231231.htm:46]** **[0000935036-24-000018_aciw-20240331.htm:20]** **[0000935036-24-000038_aciw-20240930.htm:24]** **[0000935036-24-000030_aciw-20240630.htm:22]** **[0000935036-23-000039_aciw-20230930.htm:23]** **[0000935036-23-000009_aciw-20221231.htm:45]** **[0000935036-23-000031_aciw-20230630.htm:23]** **[0000935036-23-000019_aciw-20230331.htm:20]** **[0000935036-24-000007_aciw-20231231.htm:93]** 
3. **Merchants** - Delivers payment processing solutions tailored for global merchants, ensuring secure and efficient transactions across various sales channels.  **[0000935036-24-000007_aciw-20231231.htm:119]** **[0000935036-24-000007_aciw-20231231.htm:46]** **[0000935036-24-000018_aciw-20240331.htm:20]** **[0000935036-24-000038_aciw-20240930.htm:24]** **[0000935036-24-000030_aciw-20240630.htm:22]** **[0000935036-23-000039_aciw-20230930.htm:23]** **[0000935036-23-000009_aciw-20221231.htm:45]** **[0000935036-23-000031_aciw-20230630.htm:23]** **[0000935036-23-000019_aciw-20230331.htm:20]** **[0000935036-24-000007_aciw-20231231.htm:93]**

aa58c0e58f7360d039b079fdfb7249d0d8f4954d9a17940f90b9ec0511d17185

- **The consolidation of legacy platforms in the Biller segment is not yet complete and may take several more months**, indicating potential ongoing integration challenges \[13\].
- **Recurring revenue growth in the Banking segment decelerated in Q1**, and management advises not to read too much into it, possibly signaling uncertainty in sustaining prior growth levels \[14\].
- **Strong growth in real-time payments is heavily reliant on international markets**, with the U.S. uptake being uncertain and not projected to reach critical mass soon \[7, 10\].

6a06b75b881258bb26b9681f184eb5b7330d2d8740c122973165a5b94a739b18

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

1. **Banks Segment Growth Outlook**  
   **Q:** What's driving medium-term growth in banks?  
   **A:** The banks segment is experiencing strong growth due to customers investing heavily in new products and seeking partners like ACI to enhance efficiency and speed to market. ACI is exercising some **pricing power** and is increasingly perceived as a partner helping banks achieve their objectives, strengthening the medium-term growth outlook.  **[ACIW_3406630_4]** 

2. **2025 Pipeline and Outlook**  
   **Q:** How is early renewal activity impacting future growth?  
   **A:** By completing most of this year's renewals earlier, ACI can focus on accelerating next year's pipeline. This shift allows the team to concentrate on new business for **2025**, resulting in a strong pipeline and positioning ACI to continue seeing strength in **2025 and beyond**, even with this year's outperformance.  **[ACIW_3406630_5]** **[ACIW_3406630_6]** 

3. **Payments Hub Development**  
   **Q:** When will the Payments Hub be piloted and available?  
   **A:** Initial pilot implementations of the Payments Hub are expected to begin at the beginning of the **second quarter next year**. ACI aims to ensure the solution works as intended before determining full-scale general availability, focusing on solidifying the initial pilots.  **[ACIW_3406630_7]** 

4. **Impact of U.S. Election**  
   **Q:** How might the U.S. election impact your business?  
   **A:** While it's early to quantify, the potential for a less regulated environment in the U.S. could be **positive** for ACI. Banks may have tailwinds like regulatory and economic factors, leading to more technology spending. However, as a **global company**, changes in the U.S. don't significantly alter ACI's overall expectations.  **[ACIW_3406630_8]** 

5. **Segment Performance and Outlook**  
   **Q:** Has anything changed in the segment outlook?  
   **A:** There haven't been significant changes under the hood. Banks have been **extremely strong**, and this strength is expected to continue. The biller segment shows seasonality but is performing well, and the merchant business has turned positive, contributing to growth. All segments are expected to contribute to growth next year.  **[ACIW_3406630_9]** 

6. **Mid-sized Banks Opportunity**  
   **Q:** How are mid-sized banks contributing to growth?  
   **A:** Currently, mid-sized banks are contributing very **little** to the segment. The opportunity mainly comes from the Payments Hub, but ACI is not yet advancing sales there to avoid overpromising. Future contributions are expected, particularly through **SaaS delivery** to mid-tier banks, but current strength comes from core large banks.  **[ACIW_3406630_10]** 

7. **Competitive Environment in Real-Time Payments**  
   **Q:** What's the competitive landscape in real-time payments?  
   **A:** The competitive environment remains stable. Most new business in real-time payments is **net new**, not from expansion. ACI has secured **11 central infrastructures** globally, all new implementations. The company continues to see **tremendous growth** in this area and often partners with organizations like **Mastercard**.  **[ACIW_3406630_11]** 

8. **Strategic Position with Banks**  
   **Q:** How do existing relationships with banks affect future products?  
   **A:** ACI's platforms are integral to the payments infrastructure of the largest banks, processing **trillions of dollars** daily. This trusted position makes ACI a natural partner for future initiatives like the Payments Hub. Customers rely on ACI's reliable products and are open to collaborating on future solutions.  **[ACIW_3406630_12]** **[ACIW_3406630_13]** 

d9900e2d574becbff4278da13c32dbf1ddde35644a260932bd0f516b2abbb66b

### ACI Worldwide (ACIW) Guidance in the Last Four Earnings Calls

| **Earnings Call Title** | **Issued Period** | **Guided Period** | **Guidance** |
|--------------------------|-------------------|-------------------|--------------|
| **Q3 2024 Earnings Call** | Q3 2024 | FY 2024 | 1. **Revenue**: $1.567 billion to $1.601 billion. 2. **Adjusted EBITDA**: $433 million to $448 million. 3. **Tracking to High End of Guidance**: Indicated tracking toward the high end of both revenue and adjusted EBITDA ranges. **[ACIW_3406630_3]** |
| **Q2 2024 Earnings Call** | Q2 2024 | Q3 2024 and FY 2024 | **Q3 2024 Guidance**: 1. **Revenue**: $400 million to $410 million. 2. **Adjusted EBITDA**: $110 million to $120 million. **FY 2024 Guidance**: 1. **Revenue**: $1.557 billion to $1.591 billion. 2. **Adjusted EBITDA**: $423 million to $438 million. **[ACIW_3395639_3]** |
| **Q1 2024 Earnings Call** | Q1 2024 | Q2 2024 and FY 2024 | **Q2 2024 Guidance**: 1. **Revenue**: $345 million to $355 million. 2. **Adjusted EBITDA**: $60 million to $70 million. **FY 2024 Guidance**: 1. **Revenue**: $1.547 billion to $1.581 billion. 2. **Adjusted EBITDA**: $418 million to $433 million. **[ACIW_3381474_3]** |
| **Q4 2023 Earnings Call** | Q4 2023 | FY 2024 | 1. **Revenue Growth**: 7% to 9%, with revenue in the range of $1.547 billion to $1.576 billion. 2. **Adjusted EBITDA**: $418 million to $428 million. 3. **Net Interest Expense**: $50 million to $65 million. 4. **Depreciation and Amortization**: $115 million to $120 million. 5. **Non-Cash Share-Based Compensation Expense**: $30 million to $35 million. 6. **Effective Tax Rate**: 25%. 7. **Diluted Share Count**: ~108 million (excluding future share buyback activity). 8. **Q1 2024 Revenue**: $300 million to $310 million. 9. **Q1 2024 Adjusted EBITDA**: $25 million to $35 million. **[ACIW_3375882_3]** |

bff099af2131c325aa9a44dfc7c2a74dc6ab42b15d343f697b175123898e8df2

- **Uncertainty around the Payments Hub launch:** The company's next-generation Payments Hub platform is still under development, with pilot implementations expected in the **beginning of second quarter next year**, but the full-scale general availability date is **uncertain**. The CEO stated, **"I don't know exactly when the full-scale general availability will be."** This uncertainty could delay revenue growth from this product.  **[ACIW_3406630_7]**
- **Challenging growth comparisons for 2025 due to strong 2024 performance:** After a year where **software license fees could be up 20%**, there may be difficulty in continuing strong overall growth rates in 2025. An analyst noted, **"It just does seem to... present a pretty tough comparison to continue strong overall growth rates, at least in certain quarters next year."**  **[ACIW_3406630_6]**
- **Limited contribution from mid-sized banks:** The growth in the Bank segment is primarily driven by large banks, with **minimal contribution from mid-sized banks** so far. The CEO mentioned that there is **"not a whole lot of contribution directly from that segment at this point"**, indicating reliance on large customers, which may pose risks if demand slows.  **[ACIW_3406630_10]**

8b278e00402894e7371bd074dfb383a5dba9ca067f04f2469efb43537008c41f

- **Growth in the Biller segment is expected to slow down in 2024**, falling back into the 7% to 9% range, due to non-recurring factors such as the significant interchange improvements achieved in 2023 that **"we don't have enough room to repeat"**.  **[ACIW_3375882_6]**
- **Annual Recurring Revenue (ARR) bookings decreased in 2023** because **"the largest Biller deal that we've ever sold was in the 2022 comps"**, and **"that sort of deal size did not recur in 2023"**, indicating challenges in replicating past large deals.  **[ACIW_3375882_5]**
- **Efforts to expand into mid-tier banks have not materialized yet**, with management admitting that **"it hasn't really shown up much yet"** and that it's **"a future opportunity"**, suggesting delays in realizing this growth strategy.  **[ACIW_3375882_14]**

04d1bc55fe7c8af133e3011af1b150657f379fb321808a1febf0c44f3d2f90df

- **The Biller segment reported a record 13% revenue growth in Q2**, exceeding expectations due to faster-than-expected onboarding of new customers and strong tax-related volumes, contributing to increased profitability.  **[ACIW_3395639_16]** **[ACIW_3395639_12]** **[ACIW_3395639_13]**
- **ACIW signed over $100 million in early renewals** in the first half of the year, de-risking second-half revenue and allowing focus on new deals; the growing net new pipeline across all segments, driven by market position and interest in the next-generation payment hub, sets up strong future growth.  **[ACIW_3395639_8]** **[ACIW_3395639_6]**
- **High global interest in ACIW's next-generation payment hub**, especially in Europe and Asia-Pacific due to factors like the European Central Bank's mandate for faster payments, positions the company for significant growth opportunities in 2025 and beyond.  **[ACIW_3395639_2]** **[ACIW_3395639_5]** **[ACIW_3395639_13]**

9818446a91a34ce1551d8e1cf6d348df59d3ee6e004049eb541c01fd7716bcc3

- **Strong growth expected in the Bank segment**, with anticipated **8%-9% growth in 2024**, driven by **high demand for real-time payments and fraud detection solutions**, which are projected to have **healthy double-digit growth**.  **[ACIW_3375882_14]** **[ACIW_3375882_7]**
- **Merchant segment** is expected to **accelerate growth in 2024**, potentially at the **high end of the 7%-9% consolidated growth rate**, after exiting 2023 with strong momentum.  **[ACIW_3375882_7]** **[ACIW_3375882_15]**
- **License and service bookings increased by 16%-17%** in 2023, particularly in the **Bank segment**, indicating a robust pipeline and future revenue growth.  **[ACIW_3375882_5]**

bdfc704784af51d93bc84d7a3924f9c7a81fdc00ddc3cab6729d0b5eb2ad26b6

- **Strong Growth Pipeline for 2025**: ACI has a **healthy pipeline for 2025**, with expectations to continue strong growth **despite outperformance in 2024**, supported by early contract renewals and focus on accelerating the sales pipeline.  **[ACIW_3406630_6]** **[ACIW_3406630_5]**
- **Payments Hub Development On Track**: The development of ACI's **cloud-native payments hub** is progressing as scheduled, with **pilot implementations expected in the second quarter of next year**, and there is significant customer interest, including potential expansion into the **mid-tier bank segment**.  **[ACIW_3406630_7]** **[ACIW_3406630_5]** **[ACIW_3406630_10]**
- **Trusted Partner to Top Banks**: ACI plays a **critical role in global payment infrastructure**, processing **trillions of dollars daily**, and is perceived as a **strategic partner** by the world's largest financial institutions, driving growth in the **bank segment**.  **[ACIW_3406630_4]** **[ACIW_3406630_12]**

887c9977c6b348e4c93c117e16efa7bc3a3a5eabf19765717c352521d4f23fee

- **Strong growth in real-time payments, with 28% increase in the banking segment**, driven primarily by international markets where regulatory mandates require implementation of real-time systems. Executives expect **sustainable double-digit growth** in this area.  **[ACIW_3381474_7]** **[ACIW_3381474_8]**
- The company has signed **$20 million in high-margin license contracts**, ahead of expectations, which helps de-risk the full-year forecast. This is **better than expected** in terms of magnitude and timing.  **[ACIW_3381474_16]**
- **Overperformance in SaaS transaction-based revenue** across banking and biller segments, leading to higher recurring revenue growth than anticipated. This overachievement gives confidence in continued strong performance in Q2 and beyond.  **[ACIW_3381474_14]** **[ACIW_3381474_15]** **[ACIW_3381474_9]**

1924ea2c5a94ee82e72e95f9f620ce2a1268b0fb23ad166e0598cbd808729469

- **The strong performance in the Biller segment during Q2 was largely driven by seasonal tax-related volumes and faster-than-expected ramping of a large new customer, which the company does not expect to continue into Q3 or Q4**.  **[ACIW_3395639_16]** **[ACIW_3395639_15]**  This suggests potential challenges in sustaining the current growth rate in the Biller segment.
- **Revenue growth is heavily reliant on early renewals**, with the company disincentivizing sales teams and customers to delay renewals.  **[ACIW_3395639_11]**  While this strategy has derisked the second half of the year, it may not be sustainable in the long term and could indicate a dependence on renewals rather than new business growth.
- **The company has historically struggled to add new logos in the Biller segment**, and although there is an improvement in the pipeline, it remains uncertain whether this will translate into sustained growth.  **[ACIW_3395639_12]**  This uncertainty may impact future revenue projections.

b0dcf1e4cfe55174f5113fd55da3452d665547972a5f2ca65685b9a59a70995f

Program Details	Program 1
Approval Date	2005
End Date/Duration	N/A
Total Additional Amount	$400.0 million (June 2024)
Remaining Authorization	$372.3 million (as of 2024-09-30)
Details	Repurchases depend on factors like working capital needs, acquisitions, debt obligations, stock price, and market conditions. Can be conducted via open market or Rule 10b5-1 plan. Flexible to suspend or discontinue.

ACI Worldwide Inc (ACIW)

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ACI Worldwide Inc (ACIW)

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