ACI Worldwide ACIW Form 10-Q filing Q2 FY2026

Item 1 Financial Statements (unaudited)

Condensed Consolidated Balance Sheets as ofJune30, 2026, and December 31, 2025 3

Condensed Consolidated Statements of Operations for the Three andSixMonths EndedJune30, 2026and 2025 4

Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three andSixMonths EndedJune30, 2026and 2025 5

Condensed Consolidated Statements of Stockholders’ Equity for the Three andSixMonths EndedJune30, 2026and 2025 7

Condensed Consolidated Statements of Cash Flows for theSixMonths EndedJune30, 2026and 2025 8

Notes to Condensed Consolidated Financial Statements 9

Item 2 Management’s Discussion and Analysis of Financial Condition and Results of Operations 26

Item 3 Quantitative and Qualitative Disclosures About Market Risk 41

Item 4 Controls and Procedures 41

PART II – OTHER INFORMATION

Item 1 Legal Proceedings 42

Item 1A Risk Factors 42

Item 2 Unregistered Sales of Equity Securities and Use of Proceeds 42

Item 3 Defaults Upon Senior Securities 43

Item 4 Mine Safety Disclosures 43

Item 5 Other Information 43

Item 6 Exhibits 43

Signature 44

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Item 1F. Financial Statements (unaudited)

The accompanying notes are an integral part of the condensed consolidated financial statements.

(1) The cost of revenue excludes charges for depreciation but includes amortization of purchased and developed software for resale.

The accompanying notes are an integral part of the condensed consolidated financial statements.

The accompanying notes are an integral part of the condensed consolidated financial statements.

ACI WORLDWIDE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(unaudited and in thousands, except share amounts)

The accompanying notes are an integral part of the condensed consolidated financial statements.

ACI WORLDWIDE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(unaudited and in thousands, except share amounts)

The accompanying notes are an integral part of the condensed consolidated financial statements.

The accompanying notes are an integral part of the condensed consolidated financial statements.

ACI WORLDWIDE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. Condensed Consolidated Financial Statements

The unaudited condensed consolidated financial statements include the accounts of ACI Worldwide, Inc. and its wholly-owned subsidiaries (collectively, the “Company”). All intercompany balances and transactions have been eliminated. The condensed consolidated financial statements as of June 30, 2026, and for the three and six months ended June 30, 2026 and 2025, are unaudited and reflect all adjustments of a normal recurring nature, which are, in the opinion of management, necessary for a fair presentation, in all material respects, of the financial position and operating results for the interim periods. The condensed consolidated balance sheet as of December 31, 2025, is derived from the audited financial statements.

The condensed consolidated financial statements contained herein should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2025, filed on February 26, 2026. Results for the three and six months ended June 30, 2026, are not necessarily indicative of results that may be attained in the future.

The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make judgments, estimates, and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates and assumptions are affected by management’s application of accounting policies, as well as uncertainty in the current economic environment. Actual results could differ from those estimates.

Other Current Liabilities

The components of other current liabilities are included in the following table (in thousands):

Settlement Assets and Liabilities

Individuals and businesses settle their obligations to the Company’s various Biller clients using credit or debit cards or via automated clearing house (“ACH”) payments. The Company creates a receivable for the amount due from the credit or debit card processor and an offsetting payable to the client. Upon confirmation that the funds have been received, the Company settles the obligation to the client. Due to timing, in some instances, the Company may (1) receive the funds into bank accounts controlled by and in the Company’s name that are not disbursed to its clients by the end of the day, resulting in a settlement deposit on the Company’s books and (2) disburse funds to its clients in advance of receiving funds from the credit or debit card processor, resulting in a net settlement receivable position.

Off Balance Sheet Settlement Accounts

The Company also enters into agreements with certain Biller clients to process payment funds on their behalf. When an ACH or automated teller machine network payment transaction is processed, a transaction is initiated to withdraw funds from the designated source account and deposit them into a settlement account, which is a trust account maintained for the benefit of the Company’s clients. A simultaneous transaction is initiated to transfer funds from the settlement account to the intended destination account. These “back to back” transactions are designed to settle at the same time, usually overnight, such that the Company receives the funds from the source at the same time as it sends the funds to their destination. However, due to the transactions being with various financial institutions there may be timing differences that result in float balances. These funds are maintained in accounts for the benefit of the client which is separate from the Company’s corporate assets. As the Company does not take ownership of the funds, these settlement accounts are not included in the Company’s balance sheet. The Company is entitled to interest earned on the fund balances. The collection of interest on these settlement accounts is considered in the Company’s determination of its fee structure for clients and represents a portion of the payment for services performed by the Company. The amount of settlement funds as of June 30, 2026, and December 31, 2025, was $184.9 million and $238.4 million, respectively.

Fair Value

The fair values of cash and cash equivalents approximate the carrying values due to the short period of time to maturity (Level 2 of the fair value hierarchy).

Goodwill

In accordance with the Accounting Standards Codification ("ASC") 350, Intangibles – Goodwill and Other, the Company assesses goodwill for impairment annually during the fourth quarter of its fiscal year using October 1 balances or when there is evidence that events or changes in circumstances indicate that the carrying amount of the asset may not be recovered. The Company evaluates goodwill at the reporting unit level using the discounted cash flow valuation model and allocates goodwill to these reporting units using a relative fair value approach. During this assessment, management relies on a number of factors, including operating results, business plans, and anticipated future cash flows. As of June 30, 2026, the Company's goodwill balance of $1.2 billion was allocated $813.9 million to Payment Software and $417.0 million to Biller.

Recoverability of goodwill is measured using a discounted cash flow model incorporating discount rates commensurate with the risks involved. Use of a discounted cash flow model is common practice in impairment testing in the absence of available transactional market evidence to determine the fair value. The calculated fair value was substantially in excess of the current carrying value for all reporting units based upon the October 1, 2025, annual impairment test and there have been no indications of impairment in the subsequent periods.

Equity Method Investment

In July 2019, the Company invested $18.3 million for a 30% non-controlling financial interest in a payment technology and services company in India. The Company accounted for this investment using the equity method in accordance with ASC 323, Investments - Equity Method and Joint Ventures, and recorded its share of earnings and losses in the investment on a one-quarter lag basis. In March 2025, the Company sold its 30% interest for $46.0 million. The Company recognized a gain on the sale of $25.9 million, which is recorded in other, net in the condensed consolidated statements of operations.

Recently Adopted Accounting Pronouncements

In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326), to simplify the estimation of expected credit losses for certain short-term receivables and contract assets arising from revenue transactions. The ASU introduces a practical expedient that allows entities to assume current economic conditions will persist through the reasonable and supportable forecast period for eligible assets. The Company adopted ASU 2025-05 as of January 1, 2026, which did not have a material impact on the condensed consolidated financial statements.

Recently Issued Accounting Pronouncements Not Yet Effective

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The amendments in this update will require entities to provide disaggregated disclosures of specific expense categories underlying certain income statement expense line items on an annual and interim basis. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and early application is permitted for annual financial statements that have not yet been issued or made available for issuance. The Company is currently assessing the impact that the adoption of ASU 2024-03 will have on its financial statement footnote disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The amendments in this update modernize the accounting guidance for internal-use software by replacing the previous stage-based model with a principles-based framework. Under the new guidance, cost capitalization begins when (1) management has authorized and committed to funding the software project and (2) it is probable that the project will be completed and the software will be used for its intended purpose. The update also supersedes the existing rules for website development costs, incorporating them into the internal-use software framework. ASU 2025-06 is effective for annual periods beginning after December 15, 2027, and early adoption is permitted. The Company is currently evaluating the impact that the adoption of ASU 2025-06 will have on its financial statements and related disclosures.

In December 2025, the FASB issued ASU 2025‑11, which updates interim reporting guidance under Topic 270 by introducing a principles‑based framework for determining the form and content of interim financial statements. The amendments clarify that interim reports should focus on significant changes since the last annual period and require disclosure of material events and transactions occurring during interim periods. The update also eliminates outdated language, aligns certain interim disclosure requirements with annual reporting, and provides guidance on applying materiality to interim disclosures. ASU 2025‑11 is effective for interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of this guidance on its interim financial statements and related disclosures.

2. Revenue

In accordance with ASC 606, Revenue From Contracts With Customers, revenue is recognized upon transfer of control of promised products and/or services to customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products and services. Revenue is recognized net of any taxes collected from customers and subsequently remitted to governmental authorities. See Note 9, Segment Information, for additional information, including disaggregation of revenue based on primary solution category.

Total receivables represent amounts billed and amounts earned that are to be billed in the future (i.e., accrued receivables). Included in accrued receivables are services, software as a service ("SaaS"), and platform as a service ("PaaS") revenues earned in the current period but billed in the following period and amounts due under multi-year software license arrangements with extended payment terms for which the Company has an unconditional right to invoice and receive payment subsequent to invoicing.

Total receivables, net is comprised of the following (in thousands):

No customer accounted for more than 10% of the Company’s consolidated receivables balance as of June 30, 2026 and December 31, 2025.

Deferred revenue includes amounts due or received from customers for software licenses, maintenance, services, and/or SaaS and PaaS services in advance of recording the related revenue.

Changes in deferred revenue were as follows (in thousands):

Revenue allocated to remaining performance obligations represents contracted revenue that will be recognized in future periods, which is comprised of deferred revenue and amounts that will be invoiced and recognized as revenue in future periods. This does not include:

• Revenue that will be recognized in future periods from capacity overages that are accounted for as a usage-based royalty.
• SaaS and PaaS revenue from variable consideration that will be recognized in accordance with the ‘right to invoice’ practical expedient or meets the allocation objective.

Revenue allocated to remaining performance obligations was $654.1 million as of June 30, 2026, of which the Company expects to recognize approximately 58% over the next 12 months and the remainder thereafter.

During the three and six months ended June 30, 2026, revenue recognized by the Company from performance obligations satisfied in previous periods was not significant.

3. Debt

As of June 30, 2026, the Company had $225.0 million and $601.3 million outstanding under its Revolving Credit Facility and Term Loans, respectively, with up to $373.1 million of unused borrowings under the Revolving Credit Facility portion of the Credit Agreement, as amended, and up to $1.9 million of unused borrowings under the Letter of Credit agreements. The amount of unused borrowings actually available varies in accordance with the terms of the agreement.

Credit Agreement

On February 26, 2024, ACI Worldwide, Inc. (the “Company”) entered into a Refinance Amendment (the “Amendment”) to the Second Amended and Restated Credit Agreement, dated as of April 5, 2019 (as amended, restated, supplemented or otherwise modified from time to time, including by the Amendment, the “Credit Agreement”) among the Company, the subsidiary borrowers from time to time party thereto, the lenders from time to time party thereto, Bank of America, N.A., as administrative agent and a lender, BofA Securities, Inc., PNC Capital Markets LLC, Wells Fargo Securities, LLC, and TD Securities (USA) LLC, as Joint Lead Arrangers and Joint Bookrunners, and the other financial institutions party thereto.

The Amendment (i) provides a senior secured term loan facility (the “Term Loan Facility”) in an aggregate principal amount of $500 million, (ii) provides a senior secured revolving credit facility (the “Revolving Loan Facility” and together with the Term Loan Facility, the “Credit Facilities”) of up to $600 million, and (iii) extends the maturity date of the Facilities to February 26, 2029 (the “Maturity Date”), provided that if any of the Company’s 5.750% Senior Notes due 2026 are outstanding on the date that is 91 days before the maturity thereof (the “Springing Maturity Date”), and the Company does not have sufficient liquidity as of such date, the Maturity Date will be the Springing Maturity Date. The Revolving Loan Facility includes a $35 million sublimit for the issuance of standby letters of credit and a $20 million sublimit for swingline loans. Amounts repaid under the Revolving Facility may be reborrowed.

On June 18, 2025, the Company entered into a Lender Addition and Acknowledgement Agreement with Bank of America, N.A., under the Credit Facility for an Incremental Term Loan of $200.0 million. This Incremental Term Loan is subject to all the terms and provisions of the Credit Facility.

Borrowings under the Credit Facilities bear interest at a rate equal to, at borrower's option, either (A) a base rate determined by reference to the highest of (1) the rate of interest per annum publicly announced by Bank of America as its prime rate, (2) the federal funds effective rate plus 0.5%, (3) term Secured Overnight Financing Rate ("SOFR") plus 1%, and (4) 1% or (B) term

SOFR for applicable interest period relevant to such borrowing, in each case plus an applicable margin. The applicable margin for borrowings under the Credit Facilities is, based on the calculation of the applicable consolidated total leverage ratio, between 0.5% to 1.5% with respect to base rate borrowings and between 1.5% and 2.5% with respect to term SOFR rate borrowings. Interest is due and payable monthly. The interest rate in effect for the Credit Facility as of June 30, 2026, was 5.49%.

The Company is also required to pay customary fees under the Credit Facilities, including (a) a commitment fee related to the unutilized commitments under the Revolving Credit Facility, (b) letter of credit fees including fronting fees and commissions on the maximum amount available to be drawn under all outstanding letters of credit, and (c) agency fees.

The Company’s subsidiaries, ACI Worldwide Corp. and ACI Payments, Inc. are co-borrowers under the Credit Agreement. The obligations of the borrowers under the Credit Facilities and the obligations of the Company and its subsidiaries under cash management arrangements entered into with lenders under the Credit Facilities (or affiliates thereof) are jointly and severally guaranteed by the Company and all of its existing and future material domestic subsidiaries, subject to certain exclusions. The obligations of the borrowers in respect of the Credit Facilities are secured by first-priority security interests in substantially all assets of the borrowers, including 100% of the capital stock of each domestic subsidiary of the borrower and 65% of the voting capital stock of each foreign subsidiary that is directly owned by a borrower, in each case subject to certain exclusions set forth in the Credit Agreement.

The Credit Agreement contains customary negative covenants that, among other things, restrict the Company’s ability to incur additional indebtedness, grant additional liens, and make certain acquisitions, investments, asset dispositions, and restricted payments. In addition, the Credit Agreement contains financial covenants that require the Company to maintain, as of the end of any fiscal quarter, (i) a consolidated total net leverage ratio of less than or equal to 4.25 to 1.00, (ii) a consolidated senior secured net leverage ratio of less than or equal to 3.75 to 1.00, and (iii) a minimum consolidated interest coverage ratio of greater than or equal to 3.00 to 1.00, in each case subject to certain exclusions as set forth in the Credit Agreement.

The Credit Agreement also contains certain customary affirmative covenants and events of default. If an event of default, as specified in the Credit Agreement, shall occur and be continuing, the Company may be required to repay all amounts outstanding under the Credit Facilities.

Senior Notes

On August 21, 2018, the Company completed a $400.0 million offering of the 2026 Notes at an issue price of 100% of the principal amount in a private placement for resale to qualified institutional buyers. The 2026 Notes bore interest at an annual rate of 5.750%, payable semi-annually in arrears on February 15 and August 15 of each year, which commenced on February 15, 2019. The 2026 Notes were scheduled to mature on August 15, 2026. On June 18, 2025, the Company redeemed the 2026 Notes in full as provided for under the terms.

Maturities on debt outstanding as of June 30, 2026, are as follows (in thousands):

As of June 30, 2026, and at all times during the period, the Company was in compliance with its financial debt covenants.

Total debt is comprised of the following (in thousands):

Overdraft Facility

In 2019, the Company and ACI Payments, Inc. entered in to an uncommitted overdraft facility with Bank of America, N.A. The overdraft facility bears interest at the federal funds effective rate plus 2.25% based on the Company’s average outstanding balance and the frequency in which overdrafts occur. 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. Amounts outstanding on the overdraft facility are included in other current liabilities in the condensed consolidated balance sheet. As of June 30, 2026 and December 31, 2025, there was $75.0 million available and no amount outstanding on the overdraft facility.

Other

The Company finances certain multi-year license agreements for internal-use software. Upon execution, these arrangements are treated as a non-cash investing and financing activity for purposes of the condensed consolidated statements of cash flows. As of June 30, 2026, $4.2 million was outstanding on these agreements, which is included in other current liabilities in the condensed consolidated balance sheet. As of December 31, 2025, $9.5 million was outstanding on these agreements, of which $4.8 million and $4.7 million is included in other current liabilities and other noncurrent liabilities, respectively, in the condensed consolidated balance sheet.

4. Software and Other Intangible Assets

The carrying amount and accumulated amortization of the Company's software assets subject to amortization at each balance sheet date are as follows (in thousands):

Amortization of software for internal use is computed using the straight-line method over an estimated useful life of generally three to eight years. Software for internal use amortization expense recorded during the three months ended June 30, 2026 and 2025, totaled $15.0 million and $15.6 million, respectively. Software for internal use amortization expense recorded during the six months ended June 30, 2026 and 2025, totaled $31.5 million and $31.2 million, respectively. These software amortization expense amounts are reflected in depreciation and amortization in the condensed consolidated statements of operations.

Amortization of software for resale is computed using the greater of (a) the ratio of current gross revenues to the total of current and future gross revenues expected to be derived from the software or (b) the straight-line method over the remaining estimated useful life of generally five to ten years. Software for resale amortization expense recorded during the three and six months ended June 30, 2026 totaled $0.06 million and $0.12 million, respectively. There was no software for resale amortization expense recorded during the three and six months ended June 30, 2025. These software amortization expense amounts are reflected in cost of revenue in the condensed consolidated statements of operations.

The carrying amount and accumulated amortization of the Company’s other intangible assets subject to amortization at each balance sheet date are as follows (in thousands):

Other intangible assets amortization expense recorded during the three months ended June 30, 2026 and 2025, totaled $5.4 million and $5.3 million, respectively. Other intangible assets amortization expense recorded during the six months ended June 30, 2026 and 2025, totaled $10.7 million and $10.5 million, respectively. Customer relationships amortization expense amounts are reflected in depreciation and amortization in the condensed consolidated statements of operations.

Based on capitalized intangible assets as of June 30, 2026, estimated amortization expense amounts in future fiscal years are as follows (in thousands):

5. Stock-Based Compensation Plans

Employee Stock Purchase Plan

Shares issued under the 2017 Employee Stock Purchase Plan during the six months ended June 30, 2026 and 2025, totaled 49,102 and 35,586, respectively.

Stock Options

A summary of stock option activity is as follows:

The total intrinsic value of stock options exercised during the six months ended June 30, 2026 and 2025, was $1.7 million and $1.5 million, respectively. There were no stock options granted during the six months ended June 30, 2026 or 2025.

Performance Share Awards

During the six months ended June 30, 2026, pursuant to the Company's 2020 Equity and Incentive Compensation Plan, the Company granted performance share awards with a total shareholder return component ("TSRs"). These performance share awards are earned, if at all, based upon achievement, over a specified period that must not be less than one year and is typically a three-year performance period. The awards have operating performance goals that include (i) adjusted EBITDA metrics and (ii) revenue growth rates as determined by the Company with a TSR multiplier up to plus or minus 20%. Up to 200% of the performance shares could be earned upon achievement of the performance goals, including the multiplier. On a quarterly basis, management evaluates the probability that the threshold performance goals will be achieved, if at all, and the anticipated level of attainment to determine the amount of compensation expense to record in the consolidated financial statements.

A summary of nonvested TSRs is as follows:

During the six months ended June 30, 2026, a total of 731,472 TSRs granted in fiscal 2023 vested and achieved a payout rate of 115% based on the Company's total shareholder return as compared to a group of peer companies over a three-year performance period. The Company withheld 258,680 of those shares to pay the employee's portion of the minimum payroll withholding taxes.

The fair value of TSRs granted during the six months ended June 30, 2026 and 2025, were estimated on the date of grant using the Monte Carlo simulation model, acceptable under ASC 718, Compensation - Stock Compensation, using the following weighted average assumptions:

Restricted Share Units

A summary of nonvested restricted share unit awards ("RSUs") is as follows:

During the six months ended June 30, 2026, a total of 621,176 RSUs vested. The Company withheld 198,337 of those shares to pay the employees’ portion of the minimum payroll withholding taxes. Certain RSUs vest upon retirement eligibility, but settle on the original contractual settlement date. These awards are reflected as vested when retirement eligibility is achieved and remain outstanding but unsettled until delivery occurs.

As of June 30, 2026, there was unrecognized compensation expense of $95.4 million related to RSUs and $34.7 million related to TSRs, which the Company expects to recognize over a weighted average period of 2.2 years and 2.3 years, respectively.

The Company recorded stock-based compensation expense recognized under ASC 718 for the three months ended June 30, 2026 and 2025, of $18.7 million and $16.4 million, respectively, with corresponding tax benefits of $3.1 million and $2.6 million, respectively. The Company recorded stock-based compensation expense recognized under ASC 718 for the six months ended June 30, 2026 and 2025, of $35.6 million and $28.0 million, respectively, with corresponding tax benefits of $5.7 million and $4.4 million, respectively.

6. Common Stock and Treasury Stock

In 2005, the Board approved a stock repurchase program authorizing the Company, as market and business conditions warrant, to acquire its common stock and periodically authorizes additional funds for the program. 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.

The Company repurchased 2,497,220 shares for $107.4 million during the six months ended June 30, 2026. Under the program to date, the Company has repurchased 69,544,804 shares for approximately $1.4 billion. As of June 30, 2026, the maximum remaining amount authorized for purchase under the stock repurchase program was $349.0 million.

Subsequent to June 30, 2026, the Company has repurchased additional shares under the repurchase program.

7. Earnings Per Share

Basic earnings per share is computed in accordance with ASC 260, Earnings Per Share, based on weighted average outstanding common shares. Diluted earnings per share is computed based on basic weighted average outstanding common shares adjusted for the dilutive effect of stock options, RSUs, and certain contingently issuable shares for which performance targets have been achieved.

The following table reconciles the weighted average share amounts used to compute both basic and diluted earnings per share (in thousands):

The diluted earnings per share computation excludes 1.8 million and 2.0 million options to purchase shares, RSUs, and contingently issuable shares during the three months ended June 30, 2026 and 2025, respectively, as their effect would be anti-dilutive. The diluted earnings per share computation excludes 2.0 million and 1.7 million options to purchase shares, RSUs, and contingently issuable shares during the six months ended June 30, 2026 and 2025, respectively, as their effect would be anti-dilutive.

Common stock outstanding as of June 30, 2026, and December 31, 2025, was 101,223,741 and 102,712,071, respectively.

8. Other, Net

Other, net is comprised of the following items (in thousands):

The loss on extinguishment of debt represents the loss on redemption of the 2026 Notes as discussed in Note 3, Debt.

9. Segment Information

The Company reports financial performance based on its operating segments, Payment Software, which includes bank and merchant customers, and Biller. The Company analyzes Segment Adjusted EBITDA as a measure of segment profitability.

The Company’s Chief Executive Officer is also the chief operating decision maker. The CODM, together with other senior management personnel, focus their review on consolidated financial information and the allocation of resources based on operating results, including revenues and Segment Adjusted EBITDA, for each segment, separate from corporate operations. No operating segments have been aggregated to form the reportable segments.

Payment Software. Payment Software drives payments orchestration for banks and merchants. ACI provides payment solutions to large and mid-sized banks globally for retail banking, digital, and other payment services. These solutions transform banks’ complex payment environments to speed time to market, reduce costs, and deliver a consistent experience to customers across channels while enabling them to prevent and rapidly react to fraudulent activity. In addition, they enable banks to meet the requirements of different payments schemes and to quickly create differentiated products to meet consumer, business, and merchant demands. ACI’s support of merchants globally includes Tier 1 and Tier 2 merchants (in-store and online), payment service providers, independent selling organizations, value-added resellers, and acquirers who service them. These customers operate in a variety of verticals, including general retail, grocery, hospitality, dining, travel and ticketing, and others. The Company's solutions provide merchants with a secure, omnichannel payments platform that gives them flexibility and independence. The Company also offers secure solutions to online-only merchants that provide consumers with a convenient and seamless way to shop.

Biller. Within the Biller segment, ACI provides electronic bill presentment and payment services to companies operating in the consumer finance, insurance, healthcare, higher education, utility, government, mortgage, subscription provider, and telecommunications categories. The solutions enable these customers to support a wide range of payment options and types as well as provide a convenient consumer payments experience that helps billers optimize growth and operational efficiencies while improving customer experience. ACI also provides fraud abuse protection to its Biller customers leveraging its proven AI, human, and data capabilities.

Revenue is attributed to the reportable segments based upon customer and product. Expenses are attributed to the reportable segments in one of three methods: (1) direct costs of the segment, (2) labor costs that can be attributed based upon time tracking for individual projects, or (3) costs that are allocated. Allocated costs are generally marketing and sales related activities.

Segment Adjusted EBITDA is the measure reported to the CODM for purposes of making decisions on allocating resources and assessing the performance of the Company’s segments, including budget and forecast-to-actual variances, and, therefore, Segment Adjusted EBITDA is presented in conformity with ASC 280, Segment Reporting. Segment Adjusted EBITDA is defined as earnings from operations before interest, income tax expense (benefit), depreciation and amortization (“EBITDA”) adjusted to exclude net other income (expense).

Corporate and unallocated expenses includes global facilities and information technology costs and long-term product roadmap expenses in addition to corporate overhead costs that are not allocated to reportable segments. The overhead costs relate to human resources, finance, legal, accounting, and merger and acquisition activity. These costs along with depreciation and amortization and stock-based compensation are not considered when management evaluates segment performance.

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

(a) Interchange – Interchange costs include all payment card interchange fees, amounts payable to banks, and payment card processing fees associated with providing services to Biller customers.

(b) Global Technology & Innovation – (“GTI”) costs include the costs of maintaining software products, as well as the costs required to deliver, install, and support software at customer sites. It also includes maintenance costs, which are the efforts associated with providing the customer with upgrades, 24-hour help desk, post go-live (remote) support, and production-type support for software that was previously installed at a customer location. GTI includes costs to provide SaaS and PaaS services including our data center operations. Service costs, including human resource and other incidental costs such as travel and training required for both pre go-live and post go-live support, are included. Such efforts include project management, delivery, product customization and implementation, installation support, consulting, configuration, and on-site support. GTI also includes research and development expenses which 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.

(c) Other segment items – other includes selling and marketing, product management, third-party royalties and other cost of goods sold excluding interchange. Selling and marketing costs, which are the costs related to selling our products to current and prospective customers as well as the costs related to promoting the Company, its products and the research efforts required to measure customers’ future needs and satisfaction levels. Selling costs are primarily the human resource and travel costs related to the effort expended to license our products and services to current and potential clients within defined territories and/or industries as well as the management of the overall relationship with customer accounts. Selling costs also include the costs associated with assisting distributors in their efforts to sell our products and services in their respective local markets. Product management costs are primarily the human resource costs related to developing and documenting our product requirements.

Assets are not allocated to segments, and the Company’s CODM does not evaluate operating segments using discrete asset information.

The following is revenue by primary solution category for the Company’s reportable segments for the periods indicated (in thousands):

The following is the Company's revenue by geographic location for the periods indicated (in thousands):

The following is the Company’s long-lived assets by geographic location for the periods indicated (in thousands):

No single customer accounted for more than 10% of the Company's consolidated revenue during the three and six months ended June 30, 2026 and 2025. No other country outside the United States accounted for more than 10% of the Company's consolidated revenues during the three and six months ended June 30, 2026 and 2025.

10. Income Taxes

For the three and six months ended June 30, 2026, the Company's effective tax rate was 18% and 22%, respectively. The Company reported a tax charge on pretax income for both the three and six months ended June 30, 2026, including $46.6 million and $69.8 million, respectively, of earnings recognized by foreign entities.

For the three and six months ended June 30, 2025, the Company's effective tax rate was 32% and 21%, respectively. The Company reported a tax charge on pretax income for both the three and six months ended June 30, 2025, including $19.0 million and $99.2 million, respectively, of earnings recognized by foreign entities.

The Company’s effective tax rate could fluctuate on a quarterly basis due to the occurrence of significant and unusual or infrequent items, such as vesting of stock-based compensation or foreign currency gains and losses. The Company’s effective tax rate could also fluctuate due to changes in the valuation of its deferred tax assets or liabilities, or by changes in tax laws, regulations, accounting principles, or interpretations thereof. In addition, the Company is occasionally subject to examination of its income tax returns by tax authorities in the jurisdictions it operates. The Company regularly assesses the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of its provision for income taxes.

As of both June 30, 2026, and December 31, 2025, the amount of unrecognized tax benefits for uncertain tax positions was $20.3 million.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

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

Revenues

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

The Company’s SaaS arrangements allow customers to use certain software solutions (without taking possession of the software) in a multi-tenant or single-tenant cloud environment on a subscription basis. The Company’s PaaS arrangements allow customers to use certain software solutions (without taking possession of the software) in a multi-tenant cloud environment on a subscription or consumption basis. Included in SaaS and PaaS revenue are fees paid by our customers for use of our Biller solutions. Biller-related fees may be paid by our clients or directly by their customers and may be a percentage of the underlying transaction amount, a fixed fee per executed transaction or a monthly fee for each customer enrolled. SaaS and PaaS costs include payment card interchange fees, the amounts payable to banks and payment card processing fees, which are included in cost of revenue in the condensed consolidated statements of operations. 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 $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 $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

Customers purchase the right to license ACI software under multi-year, time-based software license arrangements that vary in length but are generally five years. Under these arrangements the software is installed at the customer’s location (i.e. on-premise). Within these agreements are specified capacity limits typically based on customer transaction volume. ACI employs measurement tools that monitor the number of transactions processed by customers and if contractually specified limits are exceeded, additional fees are charged for the overage. Capacity overages may occur at varying times throughout the term of the agreement depending on the product, the size of the customer, and the significance of customer transaction volume growth. Depending on specific circumstances, multiple overages or no overages may occur during the term of the agreement.

Included in license revenue are license and capacity fees that are payable at the inception of the agreement. License revenue also includes license and capacity fees payable annually, quarterly, or monthly due to negotiated customer payment terms. 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 $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 $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 $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 $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

Services revenue includes fees earned through implementation services and other professional services. Implementation services include product installations, product configurations, and custom software modifications (“CSMs”). Other professional services include business consultancy, technical consultancy, on-site support services, product education, and testing services. These services include new customer implementations as well as existing customer migrations to new products or new releases of existing products.

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 $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 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 $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

Cost of revenue includes costs to provide SaaS and PaaS, third-party royalties, amortization of purchased and developed software for resale, the costs of maintaining our software products, as well as the costs required to deliver, install, and support software at customer sites. SaaS and PaaS service costs include payment card interchange fees, amounts payable to banks, and payment card processing fees. Maintenance costs include the efforts associated with providing the customer with upgrades, 24-hour help desk, post go-live (remote) support, and production-type support for software that was previously installed at a customer location. Service costs include human resource costs and other incidental costs such as travel and training required for both pre go-live and post go-live support. Such efforts include project management, delivery, product customization and implementation, installation support, consulting, configuration, and on-site support.

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 $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 $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

Selling and marketing includes both the costs related to selling our products to current and prospective customers as well as the costs related to promoting the Company, its products and the research efforts required to measure customers’ future needs and satisfaction levels. Selling costs are primarily the human resource and travel costs related to the effort expended to license our products and services to current and potential clients within defined territories and/or industries as well as the management of the overall relationship with customer accounts. Selling costs also include the costs associated with assisting distributors in their efforts to sell our products and services in their respective local markets. 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 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 $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 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 $0.3 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 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 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 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. 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.

Income Taxes

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

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):

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

Revenues

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.

Income Taxes

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

See Note 9, Segment Information, to our unaudited condensed consolidated financial statements in Part I of this Form 10-Q for additional information regarding segments.

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

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

General

Our primary liquidity needs are: (i) to fund normal operating expenses; (ii) to meet the interest and principal requirements of our outstanding indebtedness; and (iii) to fund acquisitions, capital expenditures, and lease payments. We believe these needs will be satisfied using cash flow generated by our operations, our cash and cash equivalents, and available borrowings under our revolving credit facility over the next 12 months and beyond.

Cash and cash equivalents consist of highly liquid investments with original maturities of three months or less. 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. earnings in foreign subsidiaries, as these earnings are not intended to be indefinitely reinvested.

Available Liquidity

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

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

Stock Repurchase Program

The Board approved a stock repurchase program authorizing the Company, as market and business conditions warrant, to acquire its common stock and periodically authorizes additional funds for the program. 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 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 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.

Cash Flows

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

Cash Flows from Operating Activities

The primary source of operating cash flows is cash collections from our customers for purchase and renewal of licensed software products and various services including software and platform as a service, maintenance, and other professional services. Our primary uses of operating cash flows include employee expenditures, taxes, interest payments, and leased facilities.

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: the timing of billings, which are typically higher in the third and fourth quarters in conjunction with sales timing and are variable based upon license renewal timing; collections, which will lag the quarters with higher billings; the timing and amounts of interest due to interest rate fluctuations; income tax and other payments; and our operating results.

Cash Flows from Investing Activities

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 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 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 $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 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

The preparation of the condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We base our estimates on historical experience and other assumptions we believe to be proper and reasonable under the circumstances. We continually evaluate the appropriateness of estimates and assumptions used in the preparation of our condensed consolidated financial statements. Actual results could differ from those estimates.

The accounting policies that reflect our more significant estimates, judgments, and assumptions, and that we believe are the most critical to aid in fully understanding and evaluating our reported financial results, include the following:

• Revenue Recognition
• Intangible Assets and Goodwill
• Stock-Based Compensation
• Accounting for Income Taxes

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.

Item 2M. Management’s Discussion and Analysis of Financial Condition and Results of Operations

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

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

Revenues

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

The Company’s SaaS arrangements allow customers to use certain software solutions (without taking possession of the software) in a multi-tenant or single-tenant cloud environment on a subscription basis. The Company’s PaaS arrangements allow customers to use certain software solutions (without taking possession of the software) in a multi-tenant cloud environment on a subscription or consumption basis. Included in SaaS and PaaS revenue are fees paid by our customers for use of our Biller solutions. Biller-related fees may be paid by our clients or directly by their customers and may be a percentage of the underlying transaction amount, a fixed fee per executed transaction or a monthly fee for each customer enrolled. SaaS and PaaS costs include payment card interchange fees, the amounts payable to banks and payment card processing fees, which are included in cost of revenue in the condensed consolidated statements of operations. 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 $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 $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

Customers purchase the right to license ACI software under multi-year, time-based software license arrangements that vary in length but are generally five years. Under these arrangements the software is installed at the customer’s location (i.e. on-premise). Within these agreements are specified capacity limits typically based on customer transaction volume. ACI employs measurement tools that monitor the number of transactions processed by customers and if contractually specified limits are exceeded, additional fees are charged for the overage. Capacity overages may occur at varying times throughout the term of the agreement depending on the product, the size of the customer, and the significance of customer transaction volume growth. Depending on specific circumstances, multiple overages or no overages may occur during the term of the agreement.

Included in license revenue are license and capacity fees that are payable at the inception of the agreement. License revenue also includes license and capacity fees payable annually, quarterly, or monthly due to negotiated customer payment terms. 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 $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 $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 $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 $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

Services revenue includes fees earned through implementation services and other professional services. Implementation services include product installations, product configurations, and custom software modifications (“CSMs”). Other professional services include business consultancy, technical consultancy, on-site support services, product education, and testing services. These services include new customer implementations as well as existing customer migrations to new products or new releases of existing products.

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 $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 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 $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

Cost of revenue includes costs to provide SaaS and PaaS, third-party royalties, amortization of purchased and developed software for resale, the costs of maintaining our software products, as well as the costs required to deliver, install, and support software at customer sites. SaaS and PaaS service costs include payment card interchange fees, amounts payable to banks, and payment card processing fees. Maintenance costs include the efforts associated with providing the customer with upgrades, 24-hour help desk, post go-live (remote) support, and production-type support for software that was previously installed at a customer location. Service costs include human resource costs and other incidental costs such as travel and training required for both pre go-live and post go-live support. Such efforts include project management, delivery, product customization and implementation, installation support, consulting, configuration, and on-site support.

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 $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 $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

Selling and marketing includes both the costs related to selling our products to current and prospective customers as well as the costs related to promoting the Company, its products and the research efforts required to measure customers’ future needs and satisfaction levels. Selling costs are primarily the human resource and travel costs related to the effort expended to license our products and services to current and potential clients within defined territories and/or industries as well as the management of the overall relationship with customer accounts. Selling costs also include the costs associated with assisting distributors in their efforts to sell our products and services in their respective local markets. 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 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 $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 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 $0.3 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 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 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 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. 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.

Income Taxes

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

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):

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

Revenues

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.

Income Taxes

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

See Note 9, Segment Information, to our unaudited condensed consolidated financial statements in Part I of this Form 10-Q for additional information regarding segments.

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

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

General

Our primary liquidity needs are: (i) to fund normal operating expenses; (ii) to meet the interest and principal requirements of our outstanding indebtedness; and (iii) to fund acquisitions, capital expenditures, and lease payments. We believe these needs will be satisfied using cash flow generated by our operations, our cash and cash equivalents, and available borrowings under our revolving credit facility over the next 12 months and beyond.

Cash and cash equivalents consist of highly liquid investments with original maturities of three months or less. 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. earnings in foreign subsidiaries, as these earnings are not intended to be indefinitely reinvested.

Available Liquidity

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

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

Stock Repurchase Program

The Board approved a stock repurchase program authorizing the Company, as market and business conditions warrant, to acquire its common stock and periodically authorizes additional funds for the program. 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 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 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.

Cash Flows

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

Cash Flows from Operating Activities

The primary source of operating cash flows is cash collections from our customers for purchase and renewal of licensed software products and various services including software and platform as a service, maintenance, and other professional services. Our primary uses of operating cash flows include employee expenditures, taxes, interest payments, and leased facilities.

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: the timing of billings, which are typically higher in the third and fourth quarters in conjunction with sales timing and are variable based upon license renewal timing; collections, which will lag the quarters with higher billings; the timing and amounts of interest due to interest rate fluctuations; income tax and other payments; and our operating results.

Cash Flows from Investing Activities

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 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 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 $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 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

The preparation of the condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We base our estimates on historical experience and other assumptions we believe to be proper and reasonable under the circumstances. We continually evaluate the appropriateness of estimates and assumptions used in the preparation of our condensed consolidated financial statements. Actual results could differ from those estimates.

The accounting policies that reflect our more significant estimates, judgments, and assumptions, and that we believe are the most critical to aid in fully understanding and evaluating our reported financial results, include the following:

• Revenue Recognition
• Intangible Assets and Goodwill
• Stock-Based Compensation
• Accounting for Income Taxes

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.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Excluding the impact of changes in interest rates, inflationary pressures, and the uncertainty in the global financial markets, there have been no material changes to our market risk for the six months ended June 30, 2026. We conduct business in all parts of the world and are thereby exposed to market risks related to fluctuations in foreign currency exchange rates. The U.S. dollar is the single largest currency in which our revenue contracts are denominated. Any decline in the value of local foreign currencies against the U.S. dollar results in our products and services being more expensive to a potential foreign customer. In those instances where our goods and services have already been sold, receivables may be more difficult to collect. Additionally, in jurisdictions where the revenue contracts are denominated in U.S. dollars and operating expenses are incurred in the local currency, any decline in the value of the U.S. dollar will have an unfavorable impact to operating margins. At times, we enter into revenue contracts that are denominated in the country’s local currency, primarily in Australia, Canada, the United Kingdom, other European countries, Brazil, India, and Singapore. This practice serves as a natural hedge to finance the local currency expenses incurred in those locations. We have not entered into any foreign currency hedging transactions. We do not purchase or hold any derivative financial instruments for speculation or arbitrage.

The primary objective of our cash investment policy is to preserve principal without significantly increasing risk. If we maintained similar cash investments for a period of one year based on our cash investments and interest rates at June 30, 2026, a hypothetical ten percent increase or decrease in effective interest rates would increase or decrease interest income by $0.3 million annually.

As of June 30, 2026, we had $826.3 million of debt outstanding under our Credit Facility. Our Credit Facility has a floating rate, which was 5.49% as of June 30, 2026. A hypothetical ten percent increase or decrease in effective interest rates would increase or decrease interest expense related to the Credit Facility by approximately $4.5 million.

Item 3Q. Quantitative and Qualitative Disclosures About Market Risk

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Excluding the impact of changes in interest rates, inflationary pressures, and the uncertainty in the global financial markets, there have been no material changes to our market risk for the six months ended June 30, 2026. We conduct business in all parts of the world and are thereby exposed to market risks related to fluctuations in foreign currency exchange rates. The U.S. dollar is the single largest currency in which our revenue contracts are denominated. Any decline in the value of local foreign currencies against the U.S. dollar results in our products and services being more expensive to a potential foreign customer. In those instances where our goods and services have already been sold, receivables may be more difficult to collect. Additionally, in jurisdictions where the revenue contracts are denominated in U.S. dollars and operating expenses are incurred in the local currency, any decline in the value of the U.S. dollar will have an unfavorable impact to operating margins. At times, we enter into revenue contracts that are denominated in the country’s local currency, primarily in Australia, Canada, the United Kingdom, other European countries, Brazil, India, and Singapore. This practice serves as a natural hedge to finance the local currency expenses incurred in those locations. We have not entered into any foreign currency hedging transactions. We do not purchase or hold any derivative financial instruments for speculation or arbitrage.

The primary objective of our cash investment policy is to preserve principal without significantly increasing risk. If we maintained similar cash investments for a period of one year based on our cash investments and interest rates at June 30, 2026, a hypothetical ten percent increase or decrease in effective interest rates would increase or decrease interest income by $0.3 million annually.

As of June 30, 2026, we had $826.3 million of debt outstanding under our Credit Facility. Our Credit Facility has a floating rate, which was 5.49% as of June 30, 2026. A hypothetical ten percent increase or decrease in effective interest rates would increase or decrease interest expense related to the Credit Facility by approximately $4.5 million.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Our management, under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer, performed an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded our disclosure controls and procedures are effective as of June 30, 2026.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) under the Exchange Act) during the quarter ended June 30, 2026, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 4C. Controls and Procedures

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Our management, under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer, performed an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded our disclosure controls and procedures are effective as of June 30, 2026.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) under the Exchange Act) during the quarter ended June 30, 2026, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, we are involved in various litigation matters arising in the ordinary course of our business. We are not currently a party to any legal proceedings the adverse outcome of which, individually or in the aggregate, we believe would be likely to have a material effect on our financial condition or results of operations.

ITEM 1A. RISK FACTORS

There have been no material changes to the risk factors disclosed in Item 1A of our Form 10-K for the fiscal year ended December 31, 2025. Additional risks and uncertainties, including risks and uncertainties not presently known to us, or that we currently deem immaterial, could also have an adverse effect on our business, financial condition and/or results of operations.

Item 1L. Legal Proceedings

ITEM 1. LEGAL PROCEEDINGS

From time to time, we are involved in various litigation matters arising in the ordinary course of our business. We are not currently a party to any legal proceedings the adverse outcome of which, individually or in the aggregate, we believe would be likely to have a material effect on our financial condition or results of operations.

ITEM 1A. RISK FACTORS

There have been no material changes to the risk factors disclosed in Item 1A of our Form 10-K for the fiscal year ended December 31, 2025. Additional risks and uncertainties, including risks and uncertainties not presently known to us, or that we currently deem immaterial, could also have an adverse effect on our business, financial condition and/or results of operations.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

The following table provides information regarding our repurchases of common stock during the three months ended June 30, 2026:

(1) Pursuant to our 2020 Equity and Performance Incentive Plan, we granted TSRs and RSUs. Under each arrangement, shares are issued without direct cost to the employee. During the three months ended June 30, 2026, 1,089,868 shares of TSRs and RSUs vested. We withheld 365,184 of those shares to pay the employees’ portion of the applicable minimum payroll withholding.

In 2005, the Board approved a stock repurchase program authorizing us, as market and business conditions warrant, to acquire our common stock and periodically authorizes additional funds for the program, with the intention of using existing cash and cash equivalents to fund these repurchases. In October 2025, the Board approved the repurchase of the Company's common stock for up to $500.0 million, in place of the remaining purchase amounts previously authorized. As of June 30, 2026, the maximum remaining amount authorized for purchase under the stock repurchase program was approximately $349.0 million.

There is no guarantee as to the exact number of shares we will repurchase. Repurchased shares are returned to the status of authorized but unissued shares of common stock. In March 2005, the Board approved a plan under Rule 10b5-1 of the Securities Exchange Act of 1934 to facilitate the repurchase of shares of common stock under the existing stock repurchase program. Under our Rule 10b5-1 plan, we have delegated authority over the timing and amount of repurchases to an independent broker who does not have access to inside information about the Company. Rule 10b5-1 allows us, through the independent broker, to purchase shares at times when we ordinarily would not be in the market because of self-imposed trading blackout periods, such as the time immediately preceding the end of the fiscal quarter through a period of three business days following our quarterly earnings release.

Item 2U. Unregistered Sales of Equity Securities and Use of Proceeds

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

The following table provides information regarding our repurchases of common stock during the three months ended June 30, 2026:

(1) Pursuant to our 2020 Equity and Performance Incentive Plan, we granted TSRs and RSUs. Under each arrangement, shares are issued without direct cost to the employee. During the three months ended June 30, 2026, 1,089,868 shares of TSRs and RSUs vested. We withheld 365,184 of those shares to pay the employees’ portion of the applicable minimum payroll withholding.

In 2005, the Board approved a stock repurchase program authorizing us, as market and business conditions warrant, to acquire our common stock and periodically authorizes additional funds for the program, with the intention of using existing cash and cash equivalents to fund these repurchases. In October 2025, the Board approved the repurchase of the Company's common stock for up to $500.0 million, in place of the remaining purchase amounts previously authorized. As of June 30, 2026, the maximum remaining amount authorized for purchase under the stock repurchase program was approximately $349.0 million.

There is no guarantee as to the exact number of shares we will repurchase. Repurchased shares are returned to the status of authorized but unissued shares of common stock. In March 2005, the Board approved a plan under Rule 10b5-1 of the Securities Exchange Act of 1934 to facilitate the repurchase of shares of common stock under the existing stock repurchase program. Under our Rule 10b5-1 plan, we have delegated authority over the timing and amount of repurchases to an independent broker who does not have access to inside information about the Company. Rule 10b5-1 allows us, through the independent broker, to purchase shares at times when we ordinarily would not be in the market because of self-imposed trading blackout periods, such as the time immediately preceding the end of the fiscal quarter through a period of three business days following our quarterly earnings release.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

Item 3D. Defaults Upon Senior Securities

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

Item 4M. Mine Safety Disclosures

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

Rule 10b5-1 Plans

None of the Company’s directors or officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the three months ended June 30, 2026.

Item 5O. Other Information

ITEM 5. OTHER INFORMATION

Rule 10b5-1 Plans

None of the Company’s directors or officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the three months ended June 30, 2026.

ITEM 6. EXHIBITS

The following lists exhibits filed as part of this quarterly report on Form 10-Q:

** This certification is not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the Company specifically incorporates it by reference.

Paper Exhibit

(1) Incorporated herein by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K filed August 17, 2017.

(2) Incorporated herein by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K filed April 1, 2022.

(3) Incorporated herein by reference to Exhibit 4.01 to the registrant’s Registration Statement No. 33-88292 on Form S-1.

Item 6E. Exhibits

ITEM 6. EXHIBITS

The following lists exhibits filed as part of this quarterly report on Form 10-Q:

** This certification is not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the Company specifically incorporates it by reference.

Paper Exhibit

(1) Incorporated herein by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K filed August 17, 2017.

(2) Incorporated herein by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K filed April 1, 2022.

(3) Incorporated herein by reference to Exhibit 4.01 to the registrant’s Registration Statement No. 33-88292 on Form S-1.