The payments software company ACI Worldwide Inc. plans to sunset some of its older products as part of a restructuring, executives said Tuesday.
The New York vendor plans to start charging customers on a "time and materials basis" for maintenance of the older products after that, Philip G. Heasley, ACI's president and chief executive officer, said on an earnings call.
"We had the unfortunate behavior of charging certain customers less than it costs us," usually in the United States, he said.
The software to be sunset, which Mr. Heasley would not identify, is three or more generations old and includes some software tools.
The decision came after a five-month review of the business, and the restructuring means the company will take charges in the second half and smaller ones in 2009, he said.
ACI also announced the departures of two longtime executives, who are leaving to pursue other interests. Mark Vipond, its president of global operations is to depart Aug. 31, and Richard Launder, its president of global sales, is to leave in February.
Their duties will be taken on by J. Ronald Totaro, who joined ACI in March as a senior vice president. He formerly was general manager of global credit scoring solutions at Fair Isaac Corp.
ACI reduced its full-year sales projection by 2% to 5%, to a range of $430 million to $440 million, as a result of a soft first quarter and contract cycles that are being extended as customers delay spending. Sales cycles that ordinarily were nine to 12 months are extending to 15 to 18 months, Mr. Heasley said. He expressed confidence in the future, though.
"We have more megadeals in our pipeline than we've ever had before," he said. "They're going to take longer to work their way through the system."
In the second quarter, ACI earned $800,000, compared to a net loss of $2.7 million a year ago.
Revenue grew 11%, to $109.2 million, including $13.5 million attributable to the British rollout of its Faster Payments system for electronic payments, said Scott Behrens, ACI's principal financial officer. "Faster Pay was the largest software event in the U.K. since the Y2K upgrade nearly a decade ago," he said.
The stock fell Tuesday, down 28.74% at midafternoon, to $14.95, despite movign from a loss to a profit and reporting revenue that topped Wall Street analysts' expectations.
