What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2026-08-06 compared with 2026-05-07 · 177 added, 74 removed, 248 unchanged (50% of the section changed)

15 unchanged sentences

The following discussion should be read together with our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, and with our financial statements and related notes contained in this Form 10-Q.

Results for the three months ended March 31, 2026, are not necessarily indicative of results that may be attained in the future.

Results for the three and six months ended June 30, 2026, are not necessarily indicative of results that may be attained in the future.

ACI Worldwide delivers transformative software solutions that power intelligent payments orchestration in real time so banks, merchants, and billers can drive growth, while continuously modernizing their payment infrastructures, simply and securely.

65 unchanged sentences

In the event a significant revision to renewal assumptions is determined to be necessary, prior periods will be adjusted for comparability purposes.

The following table sets forth our 60-month backlog estimate, by reportable segment, as of March 31, 2026, and December 31, 2025 (in millions).

The following table sets forth our 60-month backlog estimate, by reportable segment, as of June 30, 2026, March 31, 2026, and December 31, 2025 (in millions).

Dollar amounts reflect foreign currency exchange rates as of each period end.

1 unchanged sentence

We believe this measure provides useful information to investors and others in understanding and evaluating our financial performance.

March 31, 2026 December 31, 2025

June 30, 2026 March 31, 2026 December 31, 2025

Payment Software $ 3,396 $ 3,363 $ 3,372

1 unchanged sentence

Total $ 7,281 $ 7,289 $ 7,259

March 31, 2026 December 31, 2025

June 30, 2026 March 31, 2026 December 31, 2025

Committed $ 2,128 $ 2,244 $ 2,304

10 unchanged sentences

The following table presents the condensed consolidated statements of operations, as well as the percentage relationship to total revenues for items included in our condensed consolidated statements of operations (in thousands):

Three Month Period Ended March 31, 2026 Compared to the Three Month Period Ended March 31, 2025

Three Months Ended March 31,

Three Month Period Ended June 30, 2026 Compared to the Three Month Period Ended June 30, 2025

Three Months Ended June 30,

Amount % of Total

19 unchanged sentences

Total other income (expense)

(5,725) (2) % 11,261 66 % (16,986) (5) %

Income before income taxes

3 unchanged sentences

$ 31,798 6 % $ 19,596 161 % $ 12,202 3 %

Total revenue for the three months ended March 31, 2026, increased $31.2 million, or 8%, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $7.7 million increase in total revenue during the three months ended March 31, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, total revenue for the three months ended March 31, 2026, increased $23.5 million, or 6%, as compared to the same period in 2025.

Total revenue for the three months ended June 30, 2026, increased $29.2 million, or 7%, as compared to the same period in 2025.

• The impact of certain foreign currencies strengthening against the U.S.

dollar resulted in a $3.5 million increase in total revenue during the three months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, total revenue for the three months ended June 30, 2026, increased $25.7 million, or 6%, as compared to the same period in 2025.

Software as a Service (“SaaS”) and Platform as a Service (“PaaS”) Revenue

5 unchanged sentences

All fees from SaaS and PaaS arrangements that do not qualify for treatment as a distinct performance obligation, which includes set-up fees, implementation or customization services, and product support services, are included in SaaS and PaaS revenue.

SaaS and PaaS revenue increased $24.9 million, or 10%, during the three months ended March 31, 2026, as compared to the same period in 2025.

SaaS and PaaS revenue increased $13.5 million, or 5%, during the three months ended June 30, 2026, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $1.5 million increase in SaaS and PaaS revenue during the three months ended March 31, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, SaaS and PaaS revenue for the three months ended March 31, 2026, increased $23.4 million, or 10%, as compared to the same period in 2025.

• The increase was primarily driven by new customer go-lives since March 31, 2025, and higher transaction volumes during the three months ended March 31, 2026, as compared to the same period in 2025.

dollar resulted in a $0.3 million increase in SaaS and PaaS revenue during the three months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, SaaS and PaaS revenue for the three months ended June 30, 2026, increased $13.2 million, or 5%, as compared to the same period in 2025.

• The increase was primarily driven by new customer go-lives since June 30, 2025, and higher transaction volumes during the three months ended June 30, 2026, as compared to the same period in 2025.

License Revenue

8 unchanged sentences

The Company recognizes revenue in advance of billings for software license arrangements with extended payment terms and adjusts for the effects of the financing component, if significant.

License revenue increased $3.5 million, or 4%, during the three months ended March 31, 2026, as compared to the same period in 2025.

License revenue increased $12.1 million, or 21%, during the three months ended June 30, 2026, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $3.7 million increase in license revenue during the three months ended March 31, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, license revenue for the three months ended March 31, 2026, decreased $0.2 million, as compared to the same period in 2025.

dollar resulted in a $2.1 million increase in license revenue during the three months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, license revenue for the three months ended June 30, 2026, increased $10.0 million, or 17%, as compared to the same period in 2025.

• The increase was driven by license renewal timing as well as the relative size of new license and capacity events during the three months ended June 30, 2026, as compared to the same period in 2025.

Maintenance Revenue

Maintenance revenue includes standard and premium customer support and any post contract support fees received from customers for the provision of product support services.

Maintenance revenue increased $2.3 million, or 5%, during the three months ended March 31, 2026, as compared to the same period in 2025.

Maintenance revenue increased $1.1 million, or 2%, during the three months ended June 30, 2026, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $1.5 million increase in maintenance revenue during the three months ended March 31, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, maintenance revenue for the three months ended March 31, 2026, increased $0.8 million, or 2%, as compared to the same period in 2025.

dollar resulted in a $0.4 million increase in maintenance revenue during the three months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, maintenance revenue for the three months ended June 30, 2026, increased $0.7 million, or 1%, as compared to the same period in 2025.

Services Revenue

3 unchanged sentences

These services include new customer implementations as well as existing customer migrations to new products or new releases of existing products.

Services revenue increased $0.5 million, or 2%, during the three months ended March 31, 2026, as compared to the same period in 2025.

Services revenue increased $2.4 million, or 11%, during the three months ended June 30, 2026, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $1.0 million increase in services revenue during the three months ended March 31, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, services revenue for the three months ended March 31, 2026, decreased $0.5 million, or 2%, as compared to the same period in 2025.

dollar resulted in a $0.6 million increase in services revenue during the three months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, services revenue for the three months ended June 30, 2026, increased $1.8 million, or 8%, as compared to the same period in 2025.

• The increase was primarily driven by the timing and magnitude of project-related work during the three months ended June 30, 2026, as compared to the same period in 2025.

Operating Expenses

Total operating expenses for the three months ended March 31, 2026, increased $32.2 million, or 10%, as compared to the same period in 2025.

• Total operating expenses for the three months ended March 31, 2026, included $5.4 million for cost reduction strategies.

Total operating expenses for the three months ended June 30, 2026, increased $19.4 million, or 5%, as compared to the same period in 2025.

• Total operating expenses for the three months ended June 30, 2026, included $0.4 million for cost reduction strategies and $3.1 million of other significant transaction-related expenses during the period, compared to $5.1 million for cost reduction strategies and $0.4 million of other significant transaction-related expenses for the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $4.3 million increase in total operating expenses during the three months ended March 31, 2026, compared to the same period in 2025.

• Adjusted for the impact of cost reduction strategies and foreign currency, total operating expenses for the three months ended March 31, 2026, increased $22.5 million, or 7%, compared to the same period in 2025.

dollar resulted in a $1.1 million increase in total operating expenses during the three months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of cost reduction strategies, significant transaction-related expenses, and foreign currency, total operating expenses for the three months ended June 30, 2026, increased $20.3 million, or 6%, as compared to the same period in 2025.

Cost of Revenue

4 unchanged sentences

Such efforts include project management, delivery, product customization and implementation, installation support, consulting, configuration, and on-site support.

Cost of revenue increased $15.1 million, or 7%, during the three months ended March 31, 2026, compared to the same period in 2025.

Cost of revenue increased $14.1 million, or 6%, during the three months ended June 30, 2026, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $1.6 million increase in cost of revenue during the three months ended March 31, 2026, compared to the same period in 2025.

• Adjusted for the impact of foreign currency, cost of revenue for the three months ended March 31, 2026, increased $13.5 million, or 6%, compared to the same period in 2025.

• The increase was primarily due to higher payment card interchange fees of $15.4 million, partially offset by lower personnel and related expenses of $1.9 million.

dollar resulted in a $0.5 million increase in cost of revenue during the three months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, cost of revenue for the three months ended June 30, 2026, increased $13.6 million, or 6%, as compared to the same period in 2025.

• The increase was primarily due to higher payment card interchange fees of $14.6 million, partially offset by a decrease in personnel and related expenses of $1.0 million.

Research and Development

Research and development (“R&D”) expenses are primarily human resource costs related to the creation of new products, improvements made to existing products as well as compatibility with new operating system releases and generations of hardware.

R&D expense increased $5.2 million, or 13%, during the three months ended March 31, 2026, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $0.7 million increase in R&D expenses during the three months ended March 31, 2026, compared to the same period in 2025.

• Adjusted for the impact of foreign currency, R&D expenses for the three months ended March 31, 2026, increased $4.5 million, or 11%, compared to the same period in 2025.

• The increase was primarily due to higher personnel and related expenses.

R&D expense increased $6.8 million, or 17%, during the three months ended June 30, 2026, as compared to the same period in 2025.

The increase was primarily due to higher personnel and related expenses, including a $1.3 million increase in stock-based compensation expense.

Selling and Marketing

3 unchanged sentences

Marketing costs include costs incurred to promote the Company and its products, perform or acquire market research to help the Company better understand impending changes in customer demand for and of our products, and the costs associated with measuring customers’ opinions toward the Company, our products and personnel.

Selling and marketing expense decreased $2.0 million, or 6%, during the three months ended March 31, 2026, as compared to the same period in 2025.

Selling and marketing expense increased $1.9 million, or 6%, during the three months ended June 30, 2026, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $1.2 million increase in selling and marketing expense during the three months ended March 31, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, selling and marketing expense decreased $3.2 million, or 10%, for the three months ended March 31, 2026, as compared to the same period in 2025.

• The decrease was primarily due to lower personnel and related expenses.

dollar resulted in a $0.4 million increase in selling and marketing expenses during the three months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, selling and marketing expenses for the three months ended June 30, 2026, increased $1.5 million, or 5%, as compared to the same period in 2025.

• The increase was primarily due to higher personnel and related expenses and advertising and professional fees of $0.9 million and $0.6 million, respectively.

General and Administrative

General and administrative expenses are primarily human resource costs including executive salaries and benefits, personnel administration costs, and the costs of corporate support functions such as legal, administrative, human resources, and finance and accounting.

General and administrative expense increased $12.6 million, or 46%, during the three months ended March 31, 2026, as compared to the same period in 2025.

• General and administrative expenses for the three months ended March 31, 2026, included $5.4 million for cost reduction strategies.

General and administrative expense decreased $3.2 million, or 8%, during the three months ended June 30, 2026, as compared to the same period in 2025.

• General and administrative expenses for the three months ended June 30, 2026, included $0.4 million for cost reduction strategies and $3.1 million of other significant transaction-related expenses, compared to $5.1 million for cost reduction strategies and $0.4 million of other significant transaction-related expenses in the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $0.6 million increase in general and administrative expense during the three months ended March 31, 2026, as compared to the same period in 2025.

• Adjusted for the impact of cost reduction strategies and foreign currency, general and administrative expense increased $6.6 million, or 24%, for the three months ended March 31, 2026, as compared to the same period in 2025.

• The increase was primarily due to higher professional and other legal fees of $5.4 million, and personnel and related expenses of $1.2 million.

dollar resulted in a $0.3 million increase in general and administrative expense during the three months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of cost reduction strategies, significant transaction-related expenses, and foreign currency, general and administrative expense for the three months ended June 30, 2026, decreased $1.5 million, or 5%, as compared to the same period in 2025.

• The decrease was primarily due to a decrease in professional and other legal fees of $2.5 million, partially offset by an increase in personnel and related expenses of $1.0 million, including a $0.9 million increase in stock-based compensation expense.

Depreciation and Amortization

Depreciation and amortization increased $1.3 million, or 5%, during the three months ended March 31, 2026, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $0.2 million increase in depreciation and amortization expense during the three months ended March 31, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, depreciation and amortization expense increased $1.1 million, or 4%, for the three months ended March 31, 2026, as compared to the same period in 2025.

Depreciation and amortization decreased $0.2 million, or 1%, during the three months ended June 30, 2026, as compared to the same period in 2025.

Other Income and Expense

Interest expense for the three months ended March 31, 2026, decreased $2.5 million, or 17% compared to the same period in 2025, primarily due to lower comparative debt balances as well as a decrease in interest rates.

Interest expense for the three months ended June 30, 2026, decreased $2.5 million, or 18%, as compared to the same period in 2025, primarily due to lower comparative debt balances as well as a decrease in interest rates.

Interest income includes the portion of software license fees paid by customers under extended payment terms that is attributed to the significant financing component.

Interest income for the three months ended March 31, 2026, decreased $0.5 million, or 11%, as compared to the same period in 2025.

Interest income for the three months ended June 30, 2026, increased $1.7 million, or 42%, as compared to the same period in 2025.

Other, net is primarily comprised of foreign currency transaction gains and losses.

During the three months ended March 31, 2025, other, net also included the $25.9 million gain on the sale of the Company's equity method investment.

Other, net was $1.5 million and $23.7 million of income for the three months ended March 31, 2026 and 2025, respectively.

Other, net was $0.7 million of income and $6.4 million of expense for the three months ended June 30, 2026 and 2025, respectively.

During the three months ended June 30, 2025, other, net also included the $1.1 million loss on extinguishment of debt as a result of the redemption of the 2026 Notes.

See Note 10, Income Taxes, to our unaudited condensed consolidated financial statements in Part I of this Form 10-Q for additional information.

RESULTS OF OPERATIONS

Six Month Period Ended June 30, 2026 Compared to the Six Month Period Ended June 30, 2025

Six Months Ended June 30,

Amount % of Total

Revenue $ Change vs 2025 % Change vs 2025 Amount % of Total

Software as a service and platform as a service $ 546,719 64 % $ 38,378 8 % $ 508,341 64 %

License 156,836 18 % 15,632 11 % 141,204 18 %

Maintenance 102,476 12 % 3,413 3 % 99,063 12 %

Services 50,141 6 % 2,926 6 % 47,215 6 %

Total revenues 856,172 100 % 60,349 8 % 795,823 100 %

Operating expenses:

Cost of revenue 477,309 56 % 29,131 6 % 448,178 56 %

Research and development 91,992 11 % 11,977 15 % 80,015 10 %

Selling and marketing 60,839 7 % (88) — % 60,927 8 %

General and administrative 74,700 9 % 9,457 14 % 65,243 8 %

Depreciation and amortization 49,193 6 % 1,107 2 % 48,086 6 %

Total operating expenses 754,033 89 % 51,584 7 % 702,449 88 %

Operating income

102,139 11 % 8,765 9 % 93,374 12 %

Other income (expense):

Interest expense (24,177) (3) % 5,033 (17) % (29,210) (4) %

Interest income 9,198 1 % 1,200 15 % 7,998 1 %

Other, net 2,188 — % (15,159) (87) % 17,347 2 %

Total other income (expense) (12,791) (2) % (8,926) 231 % (3,865) (1) %

Income before income taxes

89,348 9 % (161) — % 89,509 11 %

Income tax expense

19,244 2 % 807 4 % 18,437 2 %

$ 70,104 7 % $ (968) (1) % $ 71,072 9 %

Total revenue for the six months ended June 30, 2026, increased $60.3 million, or 8%, as compared to the same period in 2025.

• The impact of certain foreign currencies strengthening against the U.S.

dollar resulted in a $11.1 million increase in total revenue during the six months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, total revenue for the six months ended June 30, 2026, increased $49.2 million, or 6%, as compared to the same period in 2025.

Software as a Service (“SaaS”) and Platform as a Service (“PaaS”) Revenue

SaaS and PaaS revenue increased $38.4 million, or 8%, during the six months ended June 30, 2026, as compared to the same period in 2025.

• The impact of certain foreign currencies strengthening against the U.S.

dollar resulted in $1.7 million increase in SaaS and PaaS revenue during the six months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, SaaS and PaaS revenue for the six months ended June 30, 2026, increased $36.7 million, or 7%, as compared to the same period in 2025.

• The increase was primarily driven by new customer go-lives since June 30, 2025, and higher transaction volumes during the six months ended June 30, 2026, as compared to the same period in 2025.

License Revenue

License revenue increased $15.6 million, or 11%, during the six months ended June 30, 2026, as compared to the same period in 2025.

• The impact of certain foreign currencies strengthening against the U.S.

dollar resulted in a $5.8 million increase in license revenue during the six months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, license revenue for the six months ended June 30, 2026, increased $9.8 million, or 7%, as compared to the same period in 2025.

• The increase was driven by the relative size of new license and capacity events during the six months ended June 30, 2026, as compared to the same period in 2025.

Maintenance Revenue

Maintenance revenue increased $3.4 million, or 3%, during the six months ended June 30, 2026, as compared to the same period in 2025.

• The impact of certain foreign currencies strengthening against the U.S.

dollar resulted in a $1.9 million increase in maintenance revenue during the six months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, maintenance revenue for the six months ended June 30, 2026, increased $1.5 million, or 1%, as compared to the same period in 2025.

• The increase was primarily driven by consumer price index uplifts on contracted maintenance.

Services Revenue

Services revenue increased $2.9 million, or 6%, during the six months ended June 30, 2026, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $1.7 million increase in services revenue during the six months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, services revenue for the six months ended June 30, 2026, increased $1.2 million, or 3%, as compared to the same period in 2025.

• The increase was primarily driven by the timing and magnitude of project-related work during the six months ended June 30, 2026, as compared to the same period in 2025.

Operating Expenses

Total operating expenses for the six months ended June 30, 2026 increased $51.6 million, or 7%, as compared to the same period in 2025.

• Total operating expenses for the six months ended June 30, 2026, included $5.8 million for cost reduction strategies and $3.1 million of other significant transaction-related expenses, compared to $5.1 million for cost reduction strategies and $0.4 million of other significant transaction-related expenses for the same period in 2025.

• The impact of certain foreign currencies strengthening against U.S dollar resulted in a $5.4 million increase in total operating expenses for the six months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of cost reduction strategies, significant transaction-related expenses, and foreign currency, total operating expenses for the six months ended June 30, 2026, increased $42.8 million, or 6%, as compared to the same period in 2025.

Cost of Revenue

Cost of revenue increased $29.1 million, or 6%, during the six months ended June 30, 2026, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $2.0 million increase in cost of revenue during the six months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, cost of revenue for the six months ended June 30, 2026, increased $27.1 million, or 6%, as compared to the same period in 2025.

• The increase was primarily due to higher payment card interchange fees of $30.0 million, partially offset by a decrease in personnel and related expenses of $2.9 million.

Research and Development

R&D expense increased $12.0 million, or 15%, during the six months ended June 30, 2026, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $0.6 million increase in R&D expense during the six months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, R&D expense for the six months ended June 30, 2026, increased $11.4 million, or 14%, as compared to the same period in 2025.

• The increase was primarily due to higher personnel and related expenses, including a $2.6 million increase in stock-based compensation expense.

Selling and Marketing

Selling and marketing expense decreased $0.1 million during the six months ended June 30, 2026, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $1.6 million increase in selling and marketing expense during the six months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, selling and marketing expense for the six months ended June 30, 2026, decreased $1.7 million, or 3%, as compared to the same period in 2025.

• The decrease was primarily due to a decrease in personnel and related expenses of $2.4 million, partially offset by an increase in advertising and professional fees of $0.7 million.

General and Administrative

General and administrative expense increased $9.5 million, or 14%, during the six months ended June 30, 2026, as compared to the same period in 2025.

• General and administrative expenses for the six months ended June 30, 2026, included $5.8 million for cost reduction strategies and $3.1 million of other significant transaction-related expenses, compared to $5.1 million for cost reduction strategies and $0.4 million of other significant transaction-related expenses during the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $1.0 million increase in general and administrative expense during the six months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of cost reduction strategies, significant transaction-related expenses, and foreign currency, general and administrative expense for the six months ended June 30, 2026, increased $5.1 million, or 8%, as compared to the same period in 2025.

• The increase was primarily due to higher personnel and related expenses of $2.3 million, primarily stock-based compensation expense, as well as an increase in professional fees of $2.8 million.

Depreciation and Amortization

Depreciation and amortization increased $1.1 million, or 2%, during the six months ended June 30, 2026, as compared to the same period in 2025.

• The impact of foreign currencies strengthening against the U.S.

dollar resulted in a $0.2 million increase in depreciation and amortization expense during the six months ended June 30, 2026, as compared to the same period in 2025.

• Adjusted for the impact of foreign currency, depreciation and amortization expenses for the six months ended June 30, 2026, increased $0.9 million, or 2%, as compared to the same period in 2025.

Other Income and Expense

Interest expense for the six months ended June 30, 2026, decreased $5.0 million, or 17%, as compared to the same period in 2025, primarily due to lower comparative debt balances as well as a decrease in interest rates.

Interest income for the six months ended June 30, 2026, increased $1.2 million, or 15% as compared to the same period in 2025.

Other, net is primarily comprised of foreign currency transaction gains and losses.

Other, net was $2.2 million and $17.3 million of income for the six months ended June 30, 2026 and 2025, respectively.

During the six months ended June 30, 2025, other, net also included the $25.9 million gain on the sale of the Company's equity method investment and the $1.1 million loss on extinguishment of debt.

See Note 10, Income Taxes, to our unaudited condensed consolidated financial statements in Part I of this Form 10-Q for additional information.

Segment Results

1 unchanged sentence

The following is selected financial data for our reportable segments for the periods indicated (in thousands):

Three Months Ended March 31,

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Payment Software $ 196,367 $ 179,343 $ 409,828 $ 380,068

11 unchanged sentences

$ 38,924 $ 17,872 $ 89,348 $ 89,509

Payment Software Segment Adjusted EBITDA increased $6.8 million for the three months ended March 31, 2026, compared to the same period in 2025, due to a $12.7 million increase in revenue, primarily due to an increase in SaaS and PaaS and license revenues, partially offset by a $5.9 million increase in cash operating expense.

Biller Segment Adjusted EBITDA increased $3.1 million for the three months ended March 31, 2026, compared to the same period in 2025, due to a $18.4 million increase in revenue, partially offset by a $15.3 million increase in cash operating expense, primarily payment card interchange and processing fees.

Payment Software Segment Adjusted EBITDA increased $10.3 million for the three months ended June 30, 2026, compared to the same period in 2025, due to a $17.0 million increase in revenue primarily related to an increase in license revenues, partially offset by a $6.7 million increase in cash operating expense.

Biller Segment Adjusted EBITDA decreased $5.0 million for the three months ended June 30, 2026, compared to the same period in 2025, due to a $17.1 million increase in cash operating expense primarily for payment card interchange and other processing fees, partially offset by a $12.1 million increase in revenue.

Payment Software Segment Adjusted EBITDA increased $17.1 million for the six months ended June 30, 2026, compared to the same period in 2025, due to a $29.8 million increase in revenue primarily related to an increase in license and capacity revenue, partially offset by a $12.7 million increase in cash operating expense.

Biller Segment Adjusted EBITDA decreased $2.0 million for the six months ended June 30, 2026, compared to the same period in 2025, due to a $32.6 million increase in cash operating expense primarily for payment card interchange and other processing fees, partially offset by a $30.6 million increase in revenue.

Liquidity and Capital Resources

5 unchanged sentences

Cash and cash equivalents consist of highly liquid investments with original maturities of three months or less.

As of March 31, 2026, we had $161.8 million of cash and cash equivalents, of which $79.9 million was held by our foreign subsidiaries.

As of June 30, 2026, we had $167.4 million of cash and cash equivalents, of which $77.4 million was held by our foreign subsidiaries.

The Company has recognized deferred income taxes for local country income and withholding taxes that could be incurred on distributions of certain non-U.S.

2 unchanged sentences

The following table sets forth our available liquidity for the dates indicated (in thousands):

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Cash and cash equivalents $ 167,398 $ 196,462

1 unchanged sentence

Total liquidity $ 540,498 $ 594,562

The decrease in total liquidity is primarily attributable to stock repurchase activity and payments on the Term Loan Facility, partially offset by cash generated from operations.

The decrease in total liquidity was primarily attributable to share repurchase activity and payments on the Term Loan Facility, partially offset by cash generated from operations.

Share repurchases under the Company's authorized repurchase program are executed throughout the year as market and business conditions warrant.

The Company and ACI Payments, Inc., a wholly owned subsidiary, maintain a $75.0 million uncommitted overdraft facility with Bank of America, N.A.

The overdraft facility acts as a secured loan under the terms of the Credit Agreement to provide an additional funding mechanism for timing differences that can occur in the bill payment settlement process.

As of March 31, 2026, the full $75.0 million was available.

As of June 30, 2026, the full $75.0 million was available.

Stock Repurchase Program

1 unchanged sentence

In October 2025, the Board approved the repurchase of the Company's common stock of up to $500.0 million in place of the remaining purchase amounts previously authorized.

We repurchased 1,549,291 shares for $65.8 million under the program during the three months ended March 31, 2026.

We repurchased 2,497,220 shares for $107.4 million under the program during the six months ended June 30, 2026.

Under the program to date, we have repurchased 69,544,804 shares for approximately $1.4 billion.

As of March 31, 2026, the maximum remaining amount authorized for purchase under the stock repurchase program was approximately $390.5 million.

As of June 30, 2026, the maximum remaining amount authorized for purchase under the stock repurchase program was approximately $349.0 million.

See Note 6, Common Stock and Treasury Stock, to our unaudited condensed consolidated financial statements in Part I of this Form 10-Q for additional information.

The following table sets forth summarized cash flow data for the periods indicated (in thousands):

Three Months Ended March 31,

Six Months Ended

Net cash provided by (used by):

5 unchanged sentences

Our primary uses of operating cash flows include employee expenditures, taxes, interest payments, and leased facilities.

Cash flows provided by operating activities of $64.2 million were $14.0 million lower for the three months ended March 31, 2026, compared to $78.2 million for the same period in 2025.

Operating cash flows for the current quarter decreased primarily due to the timing of customer billings and payments.

Cash flows provided by operating activities were $7.0 million higher for the six months ended June 30, 2026, compared to the same period in 2025.

Operating cash flow continued to exceed net income and benefited from lower interest payments and favorable deferred revenue trends, partially offset by working capital fluctuations.

Our cash flow from operating activities can fluctuate from period to period due to several factors, including:

6 unchanged sentences

The changes in cash flows from investing activities primarily relate to the timing of our purchases and investments in capital and other assets, including strategic acquisitions, that support our growth.

During the first three months of 2026, we used cash of $14.5 million to purchase software, property, and equipment, as compared to $8.9 million during the same period in 2025.

In addition, during the first three months of 2025, we received net proceeds of $46.0 million from the sale of our equity method investment.

During the first six months of 2026, we used cash of $28.2 million to purchase software, property, and equipment, as compared to $16.5 million during the same period in 2025.

In addition, during the first six months of 2025, we received net proceeds of $46.0 million from the sale of our equity method investment.

Cash Flows from Financing Activities

The changes in cash flows from financing activities primarily relate to borrowings and repayments related to our debt instruments and other debt, stock repurchases, and net proceeds related to employee stock programs.

During the first three months of 2026, we used $65.3 million to repurchase common stock and $3.8 million for the repurchase of stock-based compensation awards for tax withholdings.

In addition, we repaid a net $10.6 million on the Incremental Term Loan and $3.5 million of other debt payments.

We received net proceeds of $1.0 million from the exercise of stock options and the issuance of common stock under our 2017 Employee Stock Purchase Plan, as amended, and $18.1 million for settlement assets and liabilities due to processing timing.

During the first three months of 2025, we repaid a net $9.4 million on the Term Loan under the Amendment, $70.0 million on the Revolving Credit Facility, and $4.2 million of other debt payments.

During the first six months of 2026, we used $106.8 million to repurchase common stock, $19.1 million for the repurchase of stock-based compensation awards for tax withholdings, and $6.6 million for settlement assets and liabilities due to processing timing.

In addition, we repaid a net $21.3 million on the Term Loan and $10.7 million of other debt payments.

We received net proceeds of $25.0 million on the Revolving Credit Facility and $3.1 million from the exercise of stock options and the issuance of common stock under our 2017 Employee Stock Purchase Plan, as amended.

During the first six months of 2025, we repaid $400.0 million for the redemption of the 2026 Notes and $10.7 million of other debt payments.

In addition, we used $133.8 million to repurchase common stock and $20.2 million for the repurchase of stock-based compensation awards for tax withholdings.

We received net proceeds of $1.4 million from the exercise of stock options and the issuance of common stock under our 2017 Employee Stock Purchase Plan, as amended, and $88.3 million for settlement assets and liabilities due to processing timing.

We received net proceeds of $190.0 million on the Revolving Credit Facility and $181.3 million on the Term Loan, used for the redemption of the 2026 Notes.

In addition, we received proceeds of $2.4 million from the exercise of stock options and the issuance of common stock under our 2017 Employee Stock Purchase Plan, as amended, and $61.6 million for settlement assets and liabilities due to processing timing.

Contractual Obligations and Commercial Commitments

For the three months ended March 31, 2026, there have been no material changes to the contractual obligations and commercial commitments disclosed in Item 7 of our Form 10-K for the fiscal year ended December 31, 2025.

For the six months ended June 30, 2026, there have been no material changes to the contractual obligations and commercial commitments disclosed in Item 7 of our Form 10-K for the fiscal year ended December 31, 2025.

Critical Accounting Estimates

8 unchanged sentences

• Accounting for Income Taxes

During the three months ended March 31, 2026, there were no significant changes to our critical accounting policies and estimates.

During the six months ended June 30, 2026, there were no significant changes to our critical accounting policies and estimates.

Please refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in Part II, Item 7 of our Annual Report on Form 10-K for our fiscal year ended December 31, 2025, for a more complete discussion of our critical accounting policies and estimates.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis