ACI Worldwide(ACIW) - 2023 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Total revenue for Q2 2023 was $323 million, down 2% year-over-year [8][19] - Recurring revenue was$ 261 million, up 5% when adjusted for foreign exchange impact and divestiture [8] - New ARR bookings for the quarter were $13 million, with trailing 12 months bookings at$ 91 million, up 2% from the previous year [8] - Adjusted EBITDA for Q2 was $57 million, with a net debt leverage ratio of 2.9 times [19][20] Business Line Data and Key Metrics Changes - Biller segment revenue increased by 5% year-over-year, with adjusted EBITDA up 10% [10][20] - Bank segment revenue was$ 118 million, with adjusted EBITDA of $52 million [20] - Merchant segment revenue was flat, but EBITDA increased by 23% on a constant currency basis [11][20] Market Data and Key Metrics Changes - The MEASA region showed strong results and a robust pipeline, contributing to new license bookings [9] - The U.S. is expected to see a four-fold increase in real-time payments over the next four years [12] Company Strategy and Development Direction - The company aims to focus on accelerating growth, optimizing its portfolio, and maximizing shareholder value [6][17] - ACI is committed to achieving a revenue growth target of 7% to 9% in 2024 [17][21] - The company is exploring opportunities in real-time payments and AI technologies to enhance its offerings [12][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving guidance for the second half of the year, citing early contract signings as a de-risking factor [7][21] - The CEO emphasized the importance of focusing investments in areas that deliver results quickly, particularly in the Biller segment [28] Other Important Information - ACI plans to attend several investor conferences to increase engagement with the investment community [4][22] - The company has$ 200 million remaining on its share repurchase authorization [20] Q&A Session Summary Question: Expectations for Merchant segment growth - Management expects accelerating growth in the Merchant segment, primarily from international markets [25] Question: Potential major shifts in business model - Management does not anticipate major shifts but will focus on concentrating investments in high-potential areas [28] Question: Insights on Biller segment win rates and opportunities - Management noted that while win rates are not publicly disclosed, they believe they are gaining market share and expect more impact from larger deals in the second half of the year [31][32]