Executive Summary

Beat-and-raise quarter: Q1 revenue $394.6M (+25% y/y) and adjusted EBITDA $94.1M (+95% y/y); diluted EPS adjusted for non-cash/transaction items $0.51 vs S&P Global consensus $0.34; revenue beat ~$30M vs $364.4M consensus; FY25 revenue guidance raised to $1.690–$1.720B, adj. EBITDA reiterated at $480–$495M . Consensus values marked with asterisks below are from S&P Global.*
Mix/quality: Payment Software (newly combined Bank + Merchant) revenue +42% y/y; Biller +11% y/y; recurring revenue +8% to $285.7M (72% of total). Net adjusted EBITDA margin rose to 36% (on revenue net of interchange) from 24% y/y .
Balance sheet/capital return: Net leverage ~1.2x; cash $230M; repurchased 1M shares for $52M YTD ($320M authorization remaining) .
Catalysts: Large APAC competitive takeaway; accelerating demos/first version release of Connetic (cloud-native payments hub) with target live customers in early 2026; Q2 guide embeds lighter license timing before re-acceleration in H2 .

What Went Well and What Went Wrong

What Went Well
- Payment Software strength: “Revenue grew 42%, adjusted EBITDA more than doubled” y/y; issuing/acquiring drove new logo wins in APAC and LatAm .
- Strategic product execution: Connetic 1.0 released at end of April; robust demos live since Dec; “I have never seen anything like this… blew me away,” per an industry analyst (paraphrased by management) .
- Bookings/new business pull-forward: “We were able to sign more revenue in Q1 than… expected… incremental revenue this quarter comes from net new business and better-than-expected transaction volumes, not renewals” .
What Went Wrong
- Seasonality/normalization ahead: “We won’t be able to sustain a 25% revenue growth rate throughout the year,” with Q2 license lighter before picking up in Q3/Q4; front-half weighted but still below 50% .
- Biller EBITDA essentially flat: Biller segment adj. EBITDA +1% y/y; management flagged IRS/tax partners as contributors, with greater benefit in Q2, but mix limits margin upside near-term .
- FX and macro watch items: While ACI sees limited tariff/supply chain impact and slight USD benefit to revenue, FX mostly top-line (not margin) and macro remains in focus .

Financial Results

Revenue/EPS/Margins vs prior periods and estimates

Metric	Q1 2024 (YoY base)	Q4 2024 (Prior Q)	Q1 2025 (Actual)	Q1 2025 Consensus
Revenue ($M)	316.0	453.0	394.6	364.4*
Diluted EPS (GAAP)	$(0.07)	$0.93	$0.55	N/A
Diluted EPS adjusted for non‑cash & significant transaction items	$0.10	$1.08	$0.51	$0.34*
Adjusted EBITDA ($M)	48.1	157.7	94.1	N/A
Net Adjusted EBITDA Margin (% of revenue net of interchange)	24%	47%	36%	N/A

Notes: Consensus values marked with asterisks are from S&P Global.*

Segment breakdown (company’s new reporting)

Segment ($M)	Q1 2024	Q1 2025
Payment Software Revenue	141.1	200.7
Biller Revenue	174.9	193.9
Total Revenue	316.0	394.6
Payment Software Segment Adjusted EBITDA	52.3	106.6
Biller Segment Adjusted EBITDA	30.7	30.9

KPIs and operating drivers

KPI	Q1 2024	Q1 2025
Recurring Revenue ($M)	263.5	285.7
SaaS & PaaS ($M)	215.7	237.1
Maintenance ($M)	47.8	48.6
Interchange ($M)	112.4	130.8
ARR Bookings – Quarter ($M)	6.4	8.9
License & Services Bookings – Quarter ($M)	27.2	50.0
ARR Bookings – TTM ($M)	68.4	68.3
Cash from Operations ($M)	123.2	78.2
Share Repurchases ($M)	62.5 (outflow)	52.0 YTD

Balance sheet snapshot (end of Q1 2025): Cash $230.1M; total debt ~$853M; equity $1.483B .

Non-GAAP adjustments (EPS): GAAP diluted EPS $0.55; adjustments include (-)$0.20 for Mindgate gain, +$0.04 amort. intangibles, +$0.03 amort. acquired software, +$0.09 stock-based comp → adjusted diluted EPS $0.51 .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY 2025	$1.685–$1.715B	$1.690–$1.720B	Raised (narrowly higher)
Adjusted EBITDA	FY 2025	$480–$495M	$480–$495M	Maintained
Revenue	Q2 2025	N/A	$375–$385M	New quarterly guide
Adjusted EBITDA	Q2 2025	N/A	$55–$65M	New quarterly guide

Management also expects ~46% of FY25 revenue in 1H (vs 43% in 2024), reflecting earlier new-contract signings .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3 2024, Q4 2024)	Current Period (Q1 2025)	Trend
AI/technology initiatives (Connetic)	Building payment hub; strong pipelines; lowering target leverage to 2.0x, investing in innovation . MVP delivered late 2024; go-to-market in 2025; sales force unleashed post working demo .	Connetic v1.0 released end of April; many demos; aim for first live customers early next year; robust interest; expanding addressable market to mid/smaller FIs and non-banks .	Accelerating execution and market engagement
Macro/tariffs/FX	Positive momentum; disciplined capital allocation; lowered leverage target to 2.0x .	Minimal impact from tariffs/supply chain; slight USD tailwind to revenue; expenses naturally hedged; strong balance sheet if rates remain higher for longer .	Stable/benign backdrop for ACI
Product performance (issuing/acquiring; biller)	Bank +43% and Merchant +38% revenue in Q3; Biller +5% y/y with prior-year one-time margin benefits not recurring . In 2024, Bank +14%, Merchant +10%, Biller +6% with nonrecurring benefits absent .	Payment Software +42% y/y; Biller +11% y/y; biller helped by IRS/tax partners into Q2 .	Payment Software outperformance; Biller steady improvement
Regional trends	Noted strong pipelines across segments .	Largest competitive takeaway/new logo in APAC; another in LatAm; bank CIO interest in Middle East .	Broadening new-logo momentum
Regulatory/legal (RTP, cross-border, stablecoins)	—	Cross-border RTP ready technically; regulatory alignment is gating factor; limited examples (e.g., Singapore-UPI); stablecoins monitored; tech already supports crypto payments though volumes very small .	Watching regulatory evolution; positioning for optionality
Capital allocation/leverage	Net debt leverage 1.6x; target lowered to 2.0x .	Net leverage ~1.2x; $52M buybacks YTD; $320M authorization remaining .	More flexibility; continued buybacks

Management Commentary

“We grew revenue 25% and EBITDA 95%… incremental revenue this quarter comes from net new business and better-than-expected transaction volumes, not renewals” — CEO Tom Warsop .
“Our newly formed Payment Software segment… grew revenue 42%… strength in Issuing and Acquiring… Biller… revenue up 11%” — CEO .
“We are raising our guidance for full-year revenue… now $1.69–$1.72B; adjusted EBITDA $480–$495M” — CFO Scott Behrens .
Connetic launch cadence: “Working demo live since December… released version 1.0 end of April… expect first live customers early next year; sales before then” — CEO .
CFO succession: plan to retire with orderly transition; nearly 18 years of tenure noted .

Q&A Highlights

Macro/tariffs: Customer modernization decisions unaffected; in some cases creating urgency to close deals earlier; no material negative impact observed .
Segment cadence: Underlying recurring base growing ~8%; variability by quarter driven by timing of bank license deals—lighter in Q2, pick up in Q3/Q4; reiterates 7–9% constant-currency growth for 2025 .
Digital disbursements: Partnership with Ingo broadens ACI Speedpay into payouts (e.g., insurance/healthcare claims), a longer-term growth vector beyond bill pay .
APAC competitive takeaway: Won due to proven issuing/acquiring plus clear modernization path via Connetic; competitor mis-steps also helped .
Biller/IRS: IRS and tax partners were contributors in Q1; expect a bit more in Q2; company doesn’t disclose single-customer contributions .

Estimates Context

Q1 2025 vs S&P Global consensus: Revenue $394.6M vs $364.4M estimate (beat ~8%); adjusted diluted EPS $0.51 vs $0.34 estimate (beat ~$0.17). Estimate counts: 5 for revenue and EPS.* Actuals per company press release .
Implications: Upward estimate revisions likely for FY revenue (guided up) and potential H2 weighting on license deals supports EBITDA at/above midpoint given operating leverage .

Note: *Values retrieved from S&P Global.

Key Takeaways for Investors

Clear beat-and-raise: Strong Q1 execution with net-new/volume-driven upside and a modest FY revenue guidance lift; adj. EBITDA range intact, implying confidence in margin framework .
Payment Software flywheel: Issuing/acquiring wins and Connetic traction broaden pipeline; expect quarterly variability from license timing but H2 pickup should sustain momentum .
Recurring base growing mid/high single digits: 72% recurring revenue provides stability; license timing drives quarter-to-quarter noise but supports EBITDA leverage when beats occur .
Biller steady with new vectors: IRS/tax season tailwinds and new digital disbursements (Ingo partnership) add incremental growth avenues without heavy capital needs .
Balance sheet optionality: ~1.2x net leverage and ongoing buybacks ($320M remaining) provide flexibility for capital returns and selective M&A .
Watch list: Q2 guide bakes in lighter licenses; monitor Connetic early customer conversions/demos, additional competitive takeaways, and FX top-line impacts (minimal margin effect) .
Management transition: CFO retirement planned with orderly succession; no change to financial targets/time-line indicated .

Additional context for trend analysis:

Q4 2024: Revenue $453.0M; adj. EBITDA $157.7M; raised FY24 guide at the time and lowered target leverage to 2.0x .
Q3 2024: Revenue $451.8M; adj. EBITDA $166.9M; strong Banks/Merchants; cash flow up 114% y/y .

Appendix: Other Relevant Press Releases (Q1 2025)

ACI + Ingo Payments: Launch of ACI Speedpay Digital Disbursements to offer real-time and flexible payout options (RTP, PayPal/Venmo, debit, ACH) .
Co-op partnership extension: UK retailer continues using ACI Payments Orchestration Platform; full stack migrated to ACI multi-tenant cloud in Azure .

ACI WORLDWIDE, INC. (ACIW)·Q1 2025 Earnings Summary