Acxiom Corp. of Conway said recently that it is cutting 2 percent of its global workforce as it combines two divisions into one business unit. The cuts amount to about 66 people. Spokeswoman Sherry Hamilton told Arkansas Business in an email that, as of Dec. 31, the publicly traded data services firm (Nasdaq: ACXM) had about 3,300 employees worldwide.
Acxiom declined to say how many Arkansas workers would be affected. In addition to its campus in Conway, Acxiom has a small office on Main Street in Little Rock. It sold its former headquarters, a 12-story building in the River Market District, to Simmons First National Corp. of Pine Bluff last year.
Last year, executives said the company had about 1,500 workers at its Conway headquarters. More than 100 employees moved to Conway after Acxiom sold its River Market office. A small group, including a legal team of about 14, remained in an office on Main Street.
The company has other offices across the United States and in Europe and the Asia-Pacific, according to its website. “In order to best meet client needs in a rapidly evolving marketplace, we announced on Feb. 6 that we would combine our Audience Solutions and Marketing Services divisions into a new business unit called Acxiom Marketing Solutions,” the company said in a statement.
“As a follow-up to this announcement, we have made the difficult decision to eliminate about 2 percent of our global workforce. Decisions that impact jobs are never made lightly. These are among the most difficult decisions we make, as they affect friends and colleagues who have made valuable contributions to our clients, our partners and our organization.”
While reporting third-quarter financial results in February, Acxiom announced plans to realign its businesses into two units: LiveRamp and Acxiom Marketing Solutions. The company said the combination would allow it to best meet client needs, create a strong foundation for growth and enhance value for shareholders.
The firm expects to report results under the realigned business units in the first quarter of fiscal 2019.
Under the realignment, Audience Solutions assets like IdentityLinkT, AbiliTec intellectual property and Acxiom’s TV integrations would be consolidated into LiveRamp, creating what the company called the world’s first truly end-to-end identity platform for people-based marketing. The remaining Audience Solutions’ lines of business for data and data services would be combined with Marketing Services to create Acxiom Marketing Solutions.
At the time of the February announcement, Jerry Jones, executive vice president and chief ethics and legal officer, told Arkansas Business that combining the units would mean that employees on some teams would be moved around, and the company didn’t know whether positions would be cut. Acxiom announced the combination having undergone a comprehensive review of its businesses over the previous three quarters to “drive cleaner lines of sight, clearer accountabilities and to maximize its strategic flexibility.”
The company also hinted at more changes for the Acxiom Marketing Solutions division, saying in February that it intended to “actively explore options to further strengthen” the division through “a strategic partnership, acquisition, tax-free merger, joint venture, tax-free spin-off, sale or other potential strategic combinations.”
Thanks to a boost provided by federal tax reform, Acxiom expects to report fiscal 2018 revenue of between $910 million and $915 million, an increase of about 6 percent, and diluted earnings per share of between 19 cents and 23 cents. Before the benefit of tax reform, the company expected a diluted loss per share of 9 cents.
Acxiom has not yet issued guidance for fiscal 2019, but it already faces headwinds. On March 28, Facebook announced that it would end its Facebook Partner Categories program, which Acxiom and other third-party data providers participated. Acxiom said the loss of the program would hit fiscal 2019 revenue and profitability by as much as $25 million.
Acxiom’s stock price fell 19 percent the day after Facebook announced it would suspend the program. But in a blog post published Tuesday, Acxiom CEO Scott Howe said that the company saw signs that Facebook would reconsider its decision.
“We’ve seen some signs that Facebook is reconsidering the initial policy they issued last week on data imports in light of advertiser concerns that will have an economic impact,” Howe wrote. “There are many talented and smart people at Facebook. And if they take action on this feedback, it would be a smart move for them and good news for the industry.”
Research briefs released Monday and Wednesday by Brett Huff, an analyst at Stephens Inc. of Little Rock, suggested that Acxiom stock is undervalued and that its price decline was an overreaction to the Facebook news. On Monday, Acxiom announced it would expand its share repurchase program.
Huff wrote that advertisers are still likely to buy data from Acxiom. He also said potential issues, like Google banning third-party data and Facebook prohibiting first-party data distribution in Acxiom’s LiveRamp business, are unlikely to happen. Huff’s rating of the company’s stock has remained “overweight” and “volatile” since the Facebook decision.
Shares of Acxiom closed up 3.9 percent to $24.20 on Thursday.
Source: Arkansas Business