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Segment Information
 12 Months Ended
Dec. 31, 2024
Segment Reporting [Abstract]  
Segment Information Segment Information
The Company reports financial performance based on its operating segments, Banks, Merchants, and Billers, and analyzes Segment Adjusted EBITDA as a measure of segment profitability.

The Company’s Chief Executive Officer is also the chief operating decision maker ("CODM"). 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.

Banks. ACI provides payment solutions to large and mid-size 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 real-time payments schemes and to quickly create differentiated products to meet consumer, business, and merchant demands.
Merchants. 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, fuel, telecommunications, 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.

Billers. Within the billers 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 provide a convenient consumer payments experience that drives consumer loyalty and increases revenue. 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. 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):
Year Ended December 31, 2024
Banks
Merchants
Billers
Total
Revenues
$701,860 $165,910 $726,518 $1,594,288 
Less:
Interchange (a)
— — 469,358 469,358 
Global technology and innovation (b)
187,440 58,157 49,502 295,099 
Other segment items (c)
88,901 38,205 76,471 203,577 
Segment Adjusted EBITDA
$425,519 $69,548 $131,187 $626,254 
Reconciliation of income before income taxes
Depreciation and amortization(110,962)
Stock-based compensation expense(41,281)
Corporate and unallocated expenses(165,876)
Interest, net(56,545)
Other, net(1,181)
Income before income taxes$250,409 
Year Ended December 31, 2023
Banks
Merchants
Billers
Total
Revenues
$616,051 $150,616 $685,912 $1,452,579 
Less:
Interchange (a)
— — 421,133 421,133 
Global technology and innovation (b)
172,387 59,393 45,012 276,792 
Other segment items (c)
88,175 46,878 77,424 212,477 
Segment Adjusted EBITDA$355,489 $44,345 $142,343 $542,177 
Reconciliation of income before income taxes
Depreciation and amortization(122,373)
Stock-based compensation expense(24,547)
Corporate and unallocated expenses(174,849)
Interest, net(64,271)
Other, net(8,510)
Income before income taxes$147,627 
Year Ended December 31, 2022
BanksMerchantsBillersTotal
Revenues
$638,585 $153,905 $629,411 $1,421,901 
Less:
Interchange (a)
— — 406,610 406,610 
Global technology and innovation (b)
177,379 54,531 39,621 271,531 
Other segment items (c)
90,189 50,345 75,809 216,343 
Segment Adjusted EBITDA$371,017 $49,029 $107,371 $527,417 
Reconciliation of income before income taxes
Depreciation and amortization(127,328)
Stock-based compensation expense(29,753)
Corporate and unallocated expenses(166,501)
Interest, net(40,646)
Other, net43,446 
Income before income taxes$206,635 

(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. 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):
Year Ended December 31, 2024
BanksMerchantsBillersTotal
Primary Solution Categories
Bill Payments$— $— $726,518 $726,518 
Merchant Payments— 165,910 — 165,910 
Fraud Management52,412 — — 52,412 
Real-Time Payments126,740 — — 126,740 
Issuing and Acquiring522,708 — — 522,708 
Total$701,860 $165,910 $726,518 $1,594,288 
Year Ended December 31, 2023
BanksMerchantsBillersTotal
Primary Solution Categories
Bill Payments$— $— $685,912 $685,912 
Digital Business Banking2,792 — — 2,792 
Merchant Payments— 150,616 — 150,616 
Fraud Management63,503 — — 63,503 
Real-Time Payments128,957 — — 128,957 
Issuing and Acquiring420,799 — — 420,799 
Total$616,051 $150,616 $685,912 $1,452,579 
Year Ended December 31, 2022
BanksMerchantsBillersTotal
Primary Solution Categories
Bill Payments$— $— $629,411 $629,411 
Digital Business Banking35,504 — — 35,504 
Merchant Payments— 153,905 — 153,905 
Fraud Management47,421 — — 47,421 
Real-Time Payments104,777 — — 104,777 
Issuing and Acquiring450,883 — — 450,883 
Total$638,585 $153,905 $629,411 $1,421,901 
As discussed in Note 3, Divestiture, in 2022 the Company divested its corporate online banking solution assets, which were included in the Digital Business Banking solution category.
The following is revenue by the Company's reportable segments for the periods indicated (in thousands):
Year Ended December 31,
202420232022
Banks
Software as a service and platform as a service$45,020 $39,803 $48,932 
License388,291 311,549 336,028 
Maintenance176,797 189,650 184,017 
Services91,752 75,049 69,608 
Total$701,860 $616,051 $638,585 
Merchants
Software as a service and platform as a service$126,441 $123,528 $124,631 
License24,015 9,675 12,106 
Maintenance13,966 15,322 15,934 
Services1,488 2,091 1,234 
Total$165,910 $150,616 $153,905 
Billers
Software as a service and platform as a service$726,518 $685,816 $629,317 
License— — — 
Maintenance— 96 94 
Services— — — 
Total$726,518 $685,912 $629,411 

The following is the Company's revenue by geographic location for the periods indicated (in thousands):
Year Ended December 31,
202420232022
Revenue
United States$931,051 $887,168 $851,712 
Other663,237 565,411 570,189 
Total$1,594,288 $1,452,579 $1,421,901 

The following is the Company’s long-lived assets by geographic location for the periods indicated (in thousands):
December 31,
20242023
Long-lived Assets
United States$1,169,965 $1,216,158 
Other791,793 763,437 
Total$1,961,758 $1,979,595 

No single customer accounted for more than 10% of the Company’s consolidated revenues during the years ended December 31, 2024, 2023, and 2022. No other country outside the United States accounted for more than 10% of the Company’s consolidated revenues during the years ended December 31, 2024, 2023, and 2022.