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SEC filingACI Worldwide's Q1 2026 revenue grew 8% YoY to $425.7M, driven by SaaS/PaaS strength, but net income fell 35% due to prior-year gain and higher expenses.
Total revenue for Q1 2026 increased 8% to $425.7 million from $394.6 million in Q1 2025, driven by strong SaaS/PaaS growth (up 10% to $262.0M) and modest gains in license (up 4%), maintenance (up 5%), and services (up 2%). Foreign currency tailwinds contributed $7.7M to revenue, with constant-currency growth of 6%. Gross margin improved 40 bps to 46.3%, as cost of revenue grew 7% (slightly below revenue growth), partially due to higher payment card interchange fees of $15.4M. Operating income decreased 2% to $57.5M, with operating margin contracting 130 bps to 13.5%. The decline was primarily due to a 46% surge in G&A expenses to $40.2M, which included $5.4M in cost reduction initiatives and higher professional/legal fees. R&D expenses rose 13% on increased personnel costs. Net income fell 35% to $38.3M, largely because the prior year included a $25.9M gain on the sale of an equity method investment. Interest expense decreased 17% due to lower debt balances and rates.
Payment Software segment revenue increased 6.3% to $213.5M, driven by SaaS/PaaS and license. Segment adjusted EBITDA grew 6.4% to $113.3M, with margin improving slightly as revenue growth outpaced cash operating expense increases. Biller segment revenue grew 9.5% to $212.3M, reflecting higher transaction volumes and new go-lives. However, segment adjusted EBITDA increased only 9.9% to $34.0M, as cash operating expenses rose $15.3M, mostly due to interchange and processing fees tied to higher transaction volumes. The mix shift toward lower-margin Biller revenue contributed to overall operating margin pressure.
Management highlighted key growth drivers including increasing digital payment volumes, ISO 20022 adoption, cloud migration (ACI Connetic), and stablecoin opportunities via the GENIUS Act. The backlog of $7.289B provides multi-year revenue visibility, with $2.244B committed and $5.045B renewal (60-month basis). No explicit guidance was provided for the remainder of fiscal 2026. Strategic priorities remain organic growth, partnerships, and selective acquisitions. The company continues to invest in R&D and cloud-native solutions, while managing costs through restructuring initiatives. Foreign exchange fluctuations and customer renewal rates remain key uncertainties.
As of March 31, 2026, ACI Worldwide held $161.8M in cash and equivalents, down from $196.5M at year-end 2025. Total debt stood at $807.4M (including $200M drawn on the revolver and $611.9M term loans), net of $4.5M debt issuance costs, vs. $817.6M at December 31, 2025. Stockholders' equity was $1.50B. The company had $398.1M undrawn revolver capacity.
Remaining performance obligations (RPO) totaled $641.5M, with 57% expected to be recognized within 12 months. Debt maturities over the next 12 months are $31.9M (remainder of 2026) plus $42.5M in 2027, etc. Operating lease liabilities were $8.7M current and $20.5M noncurrent. Off-balance-sheet settlement funds held for clients were $177.3M.
During Q1 2026, ACI repurchased 1,549,291 shares for $65.8M, leaving $390.5M under the $500M authorization approved in October 2025. No dividends were paid. Net debt decreased by $10.2M, with $15M drawn and repaid on the revolver and $10.6M term loan repayment. Capital expenditures totaled $14.5M (3.4% of revenue), comprising $3.0M property/equipment and $11.5M internal-use software.
Revenue segments: Payment Software $213.5M (+6.3% YoY), Biller $212.3M (+9.5% YoY). Segment Adjusted EBITDA: Payment Software $113.3M (53.1% margin on revenue), Biller $34.0M (16.0% margin). Geographically, US revenue was $273.7M (64% of total), Other $152.0M (36%). No single customer exceeded 10% of revenue.