Acxiom Corp reported non-GAAP earnings of 31 cents per share in third-quarter fiscal 2018, beating the Zacks Consensus Estimate by 7 cents. The figure improved 29.2% from the year-ago quarter.
Revenues were $234.9 million, up 5.2% from the year-ago quarter but lagged the Zacks Consensus Estimate of $239 million. Excluding divestitures, Australia transition and foreign exchange effect, the company’s revenues increased 5%.
Adjusted domestic revenues were $213 million, up 5% year over year. Excluding revenues related to Australia transition and foreign exchange effect, international revenues increased 7% year over year to $21 million.
Acxiom also announced plans to realign portfolio into two distinct business units — LiveRamp and Acxiom Marketing Solutions. The company currently reports results into three units — Marketing Services, Audience Solutions and Connectivity. Beginning first-quarter fiscal 2019, Acxiom expects to report results under the realigned business units.
Segment Details
Revenues in the Marketing Services segment fell 7% year over year to $94 million. The company added three new customers during the quarter.
Marketing Services segment revenues from the U.S. markets were $88 million, down 6% year over year. International revenues fell 17% to $7 million.
Audience Solutions segment revenues inched up 1% to $84 million. Sales from the U.S. markets were $74 million, flat year over year. International revenues increased 9% to $10 million.
The Connectivity segment continued to show strong momentum, as revenues surged 45% year over year to $56 million.
Sales from the U.S. markets were $51 million, advancing 40% year over year. International revenues soared 100% to $5 million.
Acxiom’s partner network continues to expand. The company has partnered with the likes of Adobe Systems (ADBE - Free Report) , Microsoft’s (MSFT - Free Report) LinkedIn and Yelp (YELP - Free Report) Local Audiences in the recent past. During the quarter, the company announced extended partnership with RedPoint Global and 4INFO.
Operating Details
Non-GAAP gross margin expanded 300 basis points (bps) on a year-over-year basis to 53.9%. Connectivity and Marketing Services segment gross margins surged 810 bps and 80 bps, respectively. Audience Solutions gross margin contracted 110 bps.
Reported operating expenses surged 10.4% to $107.9 million. Research and development (R&D) and Sales and marketing (S&M) increased 11.3% and 24.8%, respectively. However, General and administrative (G&A) declined 2.3% from the year-ago quarter.
Total segment operating margin expanded 60 bps to 26.4%. Connectivity and Marketing Services operating margin expanded 740 and 450 bps, respectively. However, Audience Solutions operating margin contracted 230 bps from the year-ago quarter.
Non-GAAP operating margin expanded 120 bps on a year-over-year basis to 16.2% in the reported quarter.
Balance Sheet & Cash Flow
As of Dec 31, 2017, Acxiom had cash and cash equivalents of approximately $177.8 million compared with $169.5 million as of Sep 31, 2017.
Cash flow from operations was $43.6 million, up from $27.8 million in the prior quarter.
Acxiom repurchased 729,000 shares for approximately $20 million.
Guidance
For fiscal 2018, Acxiom expects revenues in the range of $910-$915 million (down from previous range of $920-$930 million), up 6% (down from previous range 7-8%) from fiscal 2017. The slashed guidance reflects lower anticipated revenues from the Audience Solutions segment.
Non-GAAP earnings are projected in the range of 85-89 cents per share (down from previous range of 80-85 cents), up 20-25% year over year (previous range was 13-20% year over year). The current guidance includes tax reform benefit of 4-5 cents.
Zacks Rank
Acxiom has a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Zacks Top 10 Stocks for 2018
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2018?
Last year's 2017 Zacks Top 10 Stocks portfolio produced double-digit winners, including FMC Corp. and VMware which racked up stellar gains of +67.9% and +61%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2018 today >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Acxiom Corp reported non-GAAP earnings of 31 cents per share in third-quarter fiscal 2018, beating the Zacks Consensus Estimate by 7 cents. The figure improved 29.2% from the year-ago quarter.
Revenues were $234.9 million, up 5.2% from the year-ago quarter but lagged the Zacks Consensus Estimate of $239 million. Excluding divestitures, Australia transition and foreign exchange effect, the company’s revenues increased 5%.
Adjusted domestic revenues were $213 million, up 5% year over year. Excluding revenues related to Australia transition and foreign exchange effect, international revenues increased 7% year over year to $21 million.
Acxiom also announced plans to realign portfolio into two distinct business units — LiveRamp and Acxiom Marketing Solutions. The company currently reports results into three units — Marketing Services, Audience Solutions and Connectivity. Beginning first-quarter fiscal 2019, Acxiom expects to report results under the realigned business units.
Segment Details
Revenues in the Marketing Services segment fell 7% year over year to $94 million. The company added three new customers during the quarter.
Marketing Services segment revenues from the U.S. markets were $88 million, down 6% year over year. International revenues fell 17% to $7 million.
Audience Solutions segment revenues inched up 1% to $84 million. Sales from the U.S. markets were $74 million, flat year over year. International revenues increased 9% to $10 million.
The Connectivity segment continued to show strong momentum, as revenues surged 45% year over year to $56 million.
Sales from the U.S. markets were $51 million, advancing 40% year over year. International revenues soared 100% to $5 million.
Acxiom’s partner network continues to expand. The company has partnered with the likes of Adobe Systems (ADBE - Free Report) , Microsoft’s (MSFT - Free Report) LinkedIn and Yelp (YELP - Free Report) Local Audiences in the recent past. During the quarter, the company announced extended partnership with RedPoint Global and 4INFO.
Operating Details
Non-GAAP gross margin expanded 300 basis points (bps) on a year-over-year basis to 53.9%. Connectivity and Marketing Services segment gross margins surged 810 bps and 80 bps, respectively. Audience Solutions gross margin contracted 110 bps.
Reported operating expenses surged 10.4% to $107.9 million. Research and development (R&D) and Sales and marketing (S&M) increased 11.3% and 24.8%, respectively. However, General and administrative (G&A) declined 2.3% from the year-ago quarter.
Total segment operating margin expanded 60 bps to 26.4%. Connectivity and Marketing Services operating margin expanded 740 and 450 bps, respectively. However, Audience Solutions operating margin contracted 230 bps from the year-ago quarter.
Non-GAAP operating margin expanded 120 bps on a year-over-year basis to 16.2% in the reported quarter.
Balance Sheet & Cash Flow
As of Dec 31, 2017, Acxiom had cash and cash equivalents of approximately $177.8 million compared with $169.5 million as of Sep 31, 2017.
Cash flow from operations was $43.6 million, up from $27.8 million in the prior quarter.
Acxiom repurchased 729,000 shares for approximately $20 million.
Guidance
For fiscal 2018, Acxiom expects revenues in the range of $910-$915 million (down from previous range of $920-$930 million), up 6% (down from previous range 7-8%) from fiscal 2017. The slashed guidance reflects lower anticipated revenues from the Audience Solutions segment.
Non-GAAP earnings are projected in the range of 85-89 cents per share (down from previous range of 80-85 cents), up 20-25% year over year (previous range was 13-20% year over year). The current guidance includes tax reform benefit of 4-5 cents.
Zacks Rank
Acxiom has a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Zacks Top 10 Stocks for 2018
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2018?
Last year's 2017 Zacks Top 10 Stocks portfolio produced double-digit winners, including FMC Corp. and VMware which racked up stellar gains of +67.9% and +61%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2018 today >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Get the latest research report on MSFT - FREE
Get the latest research report on ADBE - FREE
Get the latest research report on YELP - FREE