Acxiom Maintains FY18 Outlook Post Facebook's New Guidelines

Acxiom Corporation’s (NASDAQ:ACXM) shares declined 19% closing at $22.71 on Mar 29, after Facebook (NASDAQ:FB) temporarily severed its collaboration with third-party data providers. With a view to satiate potential investors and existing shareholders, the company recently issued a press release stating that fiscal 2018 revenues and EPS outlook remain steady.

For fiscal 2018, revenues are expected in the range of $910-$915 million, up 6% from fiscal 2017. The Zacks Consensus Estimate is pegged at $912.16 million.

Non-GAAP earnings are projected within 85-89 cents per share, up 20-25% year over year. The guidance includes tax reform benefit of 4-5 cents. The Zacks Consensus Estimate is pegged at 87 cents per share.

Acxiom however, updated preliminary 2019 guidance on Facebook’s decision. The company anticipates total revenues and profitability to be hurt by $25 million. Notably, LiveRamp is expected to grow at least 30% on a year-over-year basis. The estimates are subject to change.

Audience Solutions division of the company provided data to Facebook, which was available in Facebook Partner Categories. The data allowed marketers to target specific audience as required, and is aimed to enhance value for both end users and businesses.

Acxiom provides data to its marketing clients to help them enhance user experience by ensuring customization. The company recognizes the value of data extraction via ethical sources.

What Let to Facebook’s Move?

Facebook understands that immediate action is required given the seriousness of the recent data breach. The company will not use third-party data sets, over which it has limited control, for six months with a view to improve privacy. The move might improve its accountability.

TechCrunch revealed that Facebook will, however, continue to work with Acxiom and Experian such that it can measure ad performance, and provide metrics. The company is reviewing its relationship with third-party data brokers and marketers.

WPP (LON:WPP) PLC, TransUnion and Oracle (NYSE:ORCL) Data Cloud are the other listed brokers who might get affected. The reduction in volume of the data will affect Facebook. The targeted ads might not lead to accurate outcomes compared with earlier results. The company has not yet disclosed how this move is going to hurt its ad revenues.

Notably, the company also remodeled its privacy settings from 30 screens to a single window.

Expanding Partner Network Bodes Well for Acxiom

The company has partnered with Microsoft’s (NASDAQ:MSFT) LinkedIn (NYSE:LNKD) and Yelp Local Audiences in the past. Recently, the company announced extended partnership with RedPoint Global and 4INFO.

Acxiom’s partner network continues to expand, as evident from its partnership with technology firm Adobe Systems Inc. (NASDAQ:ADBE) , with a view to offer Adobe Marketing Cloud to its customers for seamless cross-channel marketing campaigns. Additionally, the company has teamed up with social media firm Twitter Inc (NYSE:TWTR). to aid advertisers gauge the efficacy of advertising campaigns on offline sales.

Product Portfolio Provides a Competitive Edge

Acxiom recently extended its collaboration with Adobe, and launched Digital Transformation Services and Adobe Audience Manager. The new services will enrich end-user experience by focusing on people-based marketing.

The company recently launched Patients Insights Package to empower its healthcare solutions initiatives. The new offering will ensure that insights from data on prospective patients lead to customized and relevant campaigning.

Acxiom’s frequent product innovations like AbiliTecand and partnership with 4INFO — to provide location-based targeting segments for digital campaigns — are aiding the company to expand its availability, consequently boosting the top line. IdentityLink was recently extended to television medium, aiding the marketers to effectively campaign.

To Conclude

Currently, Axiom carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Acxiom has emerged as a formidable player in the field of marketing services and technology. The company is including the latest digital programs in its InfoBase platform to increase the accessibility of its products through various digital channels.

The six months period will soon pass and we believe that the company will survive the interim on notable acquisitions, strategic partnerships, expanding customer base and diversified product portfolio.

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