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Slow sales drove down first-quarter revenue for the New York electronic payment provider ACI Worldwide Inc., but it expects to sign several new contracts this quarter.
ACI reported Wednesday that its first-quarter revenue dropped 3% from a year earlier, to $88.2 million. Its net loss shrank 16%, to $4.1 million.
The company pinned the revenue decline primarily on foreign currency exchange rates and lower license fee revenue.
Philip Heasley, ACI's chief executive officer, said in a press release that his company is "encouraged by visibility into a strong pipeline for the second quarter that, at present, appears to exceed last year's sales performance figures."
Heasley touted its $4 million of payroll expense reductions from a year earlier, despite the hiring of "seasoned services, product, and strategy leaders."
Thomas C. McCrohan, an analyst at Janney Montgomery Scott LLC, wrote in a research note published Thursday: "The main issue for the company is lack of consistency in operating performance," in part as a result of ACI's 2006 decision to stop offering heavy discounts in certain deals.
Clients that received discounts when they signed their contracts "expect the same level of discounting" today as their contracts come up for renewal, McCrohan wrote.
"By the end of this year," ACI's executives claim that "they will have worked their way through the majority of these term renewals," he wrote.
