ACI Worldwide (ACIW) Q4 2023 earnings summary

Executive summary

• FY2023 revenue was $1.453B, up 5% on an adjusted FX and divestiture basis; recurring revenue rose 8% to $1.054B on the same basis.

• FY2023 adjusted EBITDA was $395.4M, up 10% on an adjusted FX and divestiture basis; Q4 revenue was $476.6M and adjusted EBITDA was $209.7M, both up 5% and 8%, respectively.

• Management cited Bank strength in real-time payments and anti-fraud, Biller onboarding and interchange improvements, and a strong pipeline heading into 2024.

Financial highlights

• FY2023 SaaS and PaaS fees were $849.1M and maintenance fees were $205.1M; recurring revenue was $1.054B versus $1.003B in 2022.

• FY2023 net income was $121.5M versus $142.2M in 2022, which included a divestiture gain; Q4 net income was $122.6M versus $90.2M.

• FY2023 operating cash flow was $169M, up 18%; Q4 operating cash flow was $85.7M, up 107%.

• FY2023 adjusted diluted EPS was $1.86 versus $1.66; GAAP diluted EPS was $1.12. Q4 adjusted diluted EPS was $1.27 versus $1.00, and GAAP diluted EPS was $1.12 versus $0.81.

• FY2023 GAAP operating income was $220.4M versus $203.8M.

Outlook and guidance

• FY2024 revenue guidance is $1.547B–$1.576B, or 7%–9% constant-currency growth; adjusted EBITDA guidance is $418M–$428M with net adjusted EBITDA margin expansion.

• Q1 2024 guidance is revenue of $300M–$310M and adjusted EBITDA of $25M–$30M, excluding one-time costs to implement efficiency strategies.

• FY2024 guidance includes net interest expense of $60M–$65M, D&A of $115M–$120M, non-cash compensation of $30M–$35M, a 25% effective tax rate, and ~108M diluted shares, excluding future buybacks.