Acxiom : FY04 10-K

10-K 1 f10k.htm 2004 ACXIOM

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549

FORM 10-K

(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended March 31, 2004
OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission file number 0-13163

ACXIOM® CORPORATION
(Exact name of registrant as specified in its charter)

DELAWARE 71-0581897
(State or other jurisdiction of incorporation (I.R.S. Employer Identification No.)
or organization)

1 INFORMATION WAY, P.O. BOX 8180, LITTLE ROCK, ARKANSAS 72203-8180
(Address of principal executive offices) (Zip Code)

(501) 342-1000
(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.10 Par Value
(Title of Class)

Preferred Stock Purchase Rights
(Title of Class)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ___

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will
not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in
Part III of this Form 10-K or any amendment to this Form 10-K. [ ]

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act).
Yes [ X ] No [ ]

The aggregate market value of the voting stock held by non-affiliates of the registrant, based upon the closing sale price of the
registrant's Common Stock, $.10 par value per share, as of September 30, 2003 as reported on the Nasdaq National Market, was
approximately $1,218,720,400. (For purposes of determination of the above stated amount only, all directors, officers and 10% or
more shareholders of the registrant are presumed to be affiliates.)

The number of shares of Common Stock, $.10 par value per share, outstanding as of June 11, 2004, was 86,286,850.

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Table of Contents Page

Documents Incorporated by Reference ........................................................................................ 4

Part I

Availability of SEC Filings and Corporate Governance Information ........................................................... 4

Item 1. Business .......................................................................................................... 4

Item 2. Properties ........................................................................................................ 25

Item 3. Legal Proceedings ................................................................................................. 27

Item 4. Submission of Matters to a Vote of Security Holders ............................................................... 27

Part II

Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases
of Equity Securities .............................................................................................. 32

Item 6. Selected Financial Data ........................................................................................... 31

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations ............................. 32

Item 7A. Quantitative and Qualitative Disclosures About Market Risk ........................................................ 32

Item 8. Financial Statements and Supplementary Data ....................................................................... 32

Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure .............................. 32

Item 9A. Controls and Procedures ........................................................................................... 32

Part III

Item 10. Directors and Executive Officers of the Registrant ................................................................ 33

Item 11. Executive Compensation ............................................................................................ 33

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters .................... 33

Item 13. Certain Relationships and Related Transactions .................................................................... 33

Item 14. Principal Accountant Fees and Services ............................................................................ 33

Part IV

Item 15. Exhibits, Financial Statement Schedules, and Reports of Form 8-K .................................................. 34

Signatures ................................................................................................................. 27

Financial Information .............................................................................................. F-1 - F-65

DOCUMENTS INCORPORATED BY REFERENCE

Portions of Acxiom's Proxy Statement for the 2004 Annual Meeting of Shareholders ("2004 Proxy Statement") are incorporated by
reference into Part III of this Form 10-K.

PART I

AVAILABILITY OF SEC FILINGS AND CORPORATE GOVERNANCE INFORMATION

Our website address is www.acxiom.com, where copies may be obtained, free of charge, of our annual report on Form 10-K, quarterly
reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or
15(d) of the Exchange Act as soon as reasonably practicable after we electronically file these reports with, or furnish them to, the
SEC. Copies may also be obtained through the SEC's EDGAR site. Copies of these SEC filings were available on our website during the
past fiscal year covered by this Form 10-K. In addition, at the "Corporate Governance" section of our website, we have posted copies
of our Corporate Governance Principles, the charters for the Audit, Compensation, Corporate Governance, and Nominating Committees of
the Board of Directors, and the codes of ethics applicable to directors, financial personnel and all employees.

Item 1. Business

SUMMARY

Acxiom Corporation (Nasdaq: ACXM) integrates data, services and technology to create and deliver customer and information management
solutions for many of the largest, most respected companies in the world. The core components of Acxiom's innovative solutions are
Customer Data Integration (CDI) technology, data, database services, information technology ("IT") outsourcing, consulting and
analytics, and privacy leadership. Founded in 1969, Acxiom is headquartered in Little Rock, Arkansas, with locations throughout the
United States and Europe, and in Australia and Japan.

Our client base consists primarily of Fortune 1000 companies in the financial services, insurance, information services, direct
marketing, publishing, retail and telecommunications industries. Some of our major clients include Allstate, Bank of America,
BankOne, Baxter, Capital One, CitiGroup, City of Chicago, eFunds, Federated Department Stores, GE, General Motors, Guideposts,
Household, IBM, Information Services Inc., JP Morgan Chase, MBNA America, Philip Morris, Providian Financial, R.L. Polk, Sears,
Sprint and TransUnion.

We help our clients with:

o Customer acquisition through our prospect marketing solutions

o Customer growth and retention through our customer marketing solutions

o Multi-channel integration through our real-time marketing solutions

o Creation of a single-customer view through our customer recognition solutions

o Database design, data content and data quality through our Customer Data Integration solutions, which include our
AbiliTec®, Solvitur® and InfoBase® offerings

o Large-scale data and systems management through strategic IT infrastructure outsourcing

Our solutions are customized to meet the specific needs of our clients and the industries in which they operate. We believe that we
offer our clients the most technologically advanced, accurate and timely solutions available. We enable businesses to develop and
deepen customer relationships by creating a single, comprehensive customer view that is accessible, in real time, throughout the
organization. We target organizations that view data as a strategic competitive advantage and an integral component of their
business decision-making process.

Information Services Industry

We believe the following trends and dynamics in the information services industry will continue to provide us with growth
opportunities:

o Information as an asset in Customer Relationship Management

o Outsourcing managed services as a key growth area for CRM

o Customer Data Integration recognized as "central to success" in CRM

o Customer recognition becoming paramount concern

o Increasing amount of raw data to manage

o Growth in technology partnering

o Evolution of one-to-one marketing

Competitive Strengths

We intend to reinforce our position as a leading provider of customer and information management solutions by capitalizing on our
competitive strengths, which include:

o Ability to design, build and manage large-scale databases, leveraging our Customer Information InfrastructureSM grid
technology and our Solvitur marketing database framework

o Our industry-leading Customer Data Integration products and services

o Real-time customer recognition software and infrastructure

o Accurate and comprehensive data content

o Comprehensive IT outsourcing services

o Ability to attract and retain talent

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Growth Strategy

Using our competitive strengths, we are continuing to pursue the following strategic initiatives:

o Reinforce our leadership in building Customer Data Integration products and services, fully implement our Customer
Information Infrastructure grid technology, and leverage our consulting and analytics capabilities

o Encourage the sales and marketing of all of our products and services under the "One Acxiom" concept, thereby capturing
cross-selling opportunities

o Further penetrate existing and new client industries and continue development of applications for fraud detection, risk
management, privacy and security

o Continue to expand data content

o Continue to pursue international opportunities, and expand our products and services so that our multinational clients can
globally utilize Acxiom offerings

o Continue to seek alliances and acquisitions

RISK FACTORS

The risks described below could materially and adversely affect our business, financial condition and results of future operations.
These risks are not the only ones we face. Our business operations could also be impaired by additional risks and uncertainties that
are not presently known to us, or that we currently consider immaterial.

We must continue to improve and gain market acceptance of our technology, particularly AbiliTec and related technology, in order to
remain competitive and grow.

The complexity and uncertainty regarding the development of new high technologies affects our business greatly, as does the loss of
market share through competition, or the extent and timing of market acceptance of innovative products and technology. We are also
potentially affected by:

o longer sales cycles for our solutions due to the nature of that technology as an enterprise-wide solution;

o the introduction of competent, competitive products or technologies by other companies;

o changes in the consumer and/or business information industries and markets;

o the ability to protect our proprietary information and technology or to obtain necessary licenses on commercially
reasonable terms; and

o the impact of changing legislative, judicial, accounting, regulatory, cultural and consumer environments in the geographies
where our products and services will be deployed.

Maintaining technological competitiveness in our data products, processing functionality, software systems and services is key to
our continued success. Our ability to continually improve our current processes and to develop and introduce new products and
services is essential in order to maintain our competitive position and meet the increasingly sophisticated requirements of our
clients. If we fail to do so, we could lose clients to current or future competitors, which could result in decreased revenues, net
income and earnings per share.

General economic conditions and world events could continue to result in a reduced demand for our products and services.

As a result of the economic recession over the past few years, we experienced a reduction in the demand for our products and
services as our clients looked for ways to reduce their expenses. Although the economy has improved significantly over the past
twelve months, how our clients procure our products and services has changed in some instances. Many clients are negotiating their
contracts through a contracts procurement representative rather than through their business leaders. In the face of increasing
demands by clients for price reductions and discounts, we are challenged with pricing our products and services so as to be able to
make reasonable profits. We likewise continue to be challenged with controlling our expenses, given that a significant portion of
our costs are fixed. If we are not successful in meeting these challenges, we could suffer lower net income and earnings per share
In addition, world events such as the situation in Iraq and the continuing threats of terrorism may have a negative impact upon the
economy in general and upon our business as well, if our clients become hesitant to embark on discretionary spending programs.

Changes in legislative, judicial, regulatory, cultural or consumer environments relating to consumer privacy or information
collection and use may affect our ability to collect and use data.

There could be a material adverse impact on our business due to the enactment of legislation or industry regulations, the issuance
of judicial interpretations, or simply a change in customs, arising from public concern over consumer privacy issues. Restrictions
could be placed upon the collection, management, aggregation and use of information that is legally available, which could result in
a material increase in the cost of collecting some kinds of data. It is also possible that we could be prohibited from collecting or
disseminating certain types of data, which could in turn materially adversely affect our ability to meet our clients' requirements.

Data suppliers might withdraw data from us, leading to our inability to provide products and services.

Much of the data that we use is either purchased or licensed from third parties. We compile the remainder of the data that we use
from public record sources. We could suffer a material adverse effect if owners of the data we use were to withdraw the data from
us. Data providers could withdraw their data from us if there is a competitive reason to do so, or if legislation is passed
restricting the use of the data, or if judicial interpretations are issued restricting use of data. If a substantial number of data
providers were to withdraw their data, our ability to provide products and services to our clients could be materially adversely
impacted, which could result in decreased revenues, net income and earnings per share.

Failure to attract and retain qualified associates could adversely affect our business.

Competition for qualified technical, sales and other personnel is often intense, and we periodically are required to pay premium
wages to attract and retain good associates. There can be no assurance that we will be able to continue to hire and retain
sufficient qualified management, technical, sales and other associates necessary to conduct our operations successfully.

The nature and volume of our customer contracts may affect the predictability of our revenues.

While approximately 80% of our total revenue is currently derived from client contracts with initial terms of at least two years,
these contracts have been entered into at various times and therefore some of them are in the latter part of their terms and are
approaching their originally scheduled expiration dates. Further, if renewed by the customer, the terms of the renewal contract may
not have a term as long as, or may otherwise be on terms less favorable than, the original contract. Revenue from customers with
long-term contracts is not necessarily "fixed" or guaranteed, however, as portions of the revenue from these customers is
volume-driven or project-related. With respect to the portion of our business that is not under long-term contract, revenues are
less predictable and are almost completely volume-driven or project-related. Therefore, we must engage in continual sales efforts to
maintain revenue stability and future growth with these customers. In addition, if a significant customer fails to renew a contract,
our business could be negatively impacted if additional business were not obtained to replace the business which was lost.

Our operations outside the U.S. subject us to risks normally associated with international operations.

We conduct business outside of the United States. During the last fiscal year, we received approximately 8% of our revenues from
business outside the United States. In the fourth quarter of fiscal 2004 we completed the acquisitions of Claritas Europe and
Consodata S.A., and as part of our growth strategy we plan to continue to pursue opportunities outside the U.S. Accordingly, our
future operating results could be negatively affected by a variety of factors, some of which are beyond our control. These factors
include legislative, judicial, accounting, regulatory, political or economic conditions in a specific country or region, trade
protection measures, and other regulatory requirements. In order to successfully expand non-U.S. revenues in future periods, we must
continue to strengthen our foreign operations, hire additional personnel, and continue to identify and execute beneficial strategic
alliances. To the extent that we are unable to do these things in a timely manner, our growth, if any, in non-U.S. revenues will be
limited, and our operating results could be materially adversely affected. In general, each of our foreign locations is expected to
fund its own operations and cash flows, although periodically funds may be loaned or invested from the U.S. to the foreign
subsidiaries. Therefore, exchange rate movements of foreign currencies may have an impact on our future costs or on future cash
flows from foreign investments. We have not entered into any foreign currency forward exchange contracts or other derivative
instruments to hedge the effects of adverse fluctuations in foreign currency exchange rates. Additional risks inherent in our
non-U.S. business activities generally include, among others, potentially longer accounts receivable payment cycles, the costs and
difficulties of managing international operations, potentially adverse tax consequences, and greater difficulty enforcing
intellectual property rights. The various risks which are inherent in doing business in the United States are also generally
applicable to doing business outside of the United States, and may be exaggerated by the difficulty of doing business in numerous
sovereign jurisdictions due to differences in culture, laws and regulations.

Loss of data center capacity or interruption of telecommunication links could adversely affect our business.

Our ability to protect our data centers against damage from fire, power loss, telecommunications failure or other disasters is
critical to our future. The on-line services we provide are dependent on links to telecommunication providers. We believe we have
taken reasonable precautions to protect our data centers and telecommunication links from events that could interrupt our
operations. Any damage to our data centers or any failure of our telecommunications links that causes interruptions in our
operations could materially adversely affect our ability to meet our clients' requirements, which could result in decreased
revenues, income, and earnings per share.

We could experience a breach of the security of our computer systems.

We operate extremely large, powerful and complex computer systems. Unauthorized third parties could attempt to gain entry to such
systems for the purpose of stealing data or disrupting the systems. We believe that we have taken adequate measures to protect them
from intrusion, but in the event that our efforts are unsuccessful we could suffer significant harm.

Failure to favorably negotiate or effectively integrate acquisitions or alliances could adversely affect our business.

Recently our growth strategy has included growth through acquisitions and strategic alliances. While we believe we will be able to
successfully integrate recently acquired businesses into our existing operations, there is no certainty that future acquisitions or
alliances will be consummated on acceptable terms or that any acquired assets, data or businesses will be successfully integrated
into our operations. Our failure to identify appropriate candidates, to negotiate favorable terms, or to successfully integrate
future acquisitions and alliances into our existing operations could result in decreased revenues, net income and earnings per
share.

Decline in value of investments could negatively impact us.

Due to the general recession in the market that took place over the past few years, several of our investments in other ventures
have declined and could continue to decline in value. While several of the investments have been written down accordingly, others
could also be subject to future write-down in the event their values become impaired.

Postal rate increases and disruptions in postal services could lead to reduced volume of business.

The direct marketing industry has been negatively impacted from time to time during past years by postal rate increases. The last
increase in the U.S. was in June 2002. While no further increases are expected until 2006, it is possible that increases could occur
sooner. Postal rate increases could force direct mailers to mail fewer pieces and to target their prospects more carefully.
Additionally, the amount of direct mailings could be reduced in response to disruptions in and concerns over the security of the
U.S. mail system, its global counterparts, and other delivery systems. Such responses by direct mailers could negatively affect us
by decreasing the amount of processing services purchased from us, which could result in lower revenues, net income and earnings per
share.

Industry consolidations could result in increased competition for our products and services.

The possibility of the consolidation or merger of companies who might combine forces to create a single-source provider of multiple
services to the marketplace in which we compete could result in increased competition for us. We currently compete against numerous
providers of a single service or product in several separate market spaces. (See the discussion below under "Competition.") Since
we offer a larger variety of services than many of our current competitors, we have been able to successfully compete against them
in most instances. However, the dynamics of the marketplace could be significantly altered if some of the single-service providers
were to combine with each other to provide a wider variety of services.

ACXIOM'S BUSINESS

Overview

We integrate data, services and technology to create and deliver customer and information management solutions for many of the
largest, most respected companies in the world. The core components of Acxiom's innovative solutions are Customer Data Integration
(CDI) technology, data, database services, information technology ("IT") outsourcing, consulting and analytics, and privacy
leadership. Founded in 1969, Acxiom is headquartered in Little Rock, Arkansas, with locations throughout the United States and
Europe, and in Australia and Japan.

Our products and services enable our clients to use information to improve their business decision-making processes and to
effectively manage existing and prospective customer relationships, thereby positioning them to maximize the value of their customer
relationships and increase their profits. Our solutions are customized to meet the specific needs of our clients and the industries
in which they operate. We believe that we offer our clients the most technologically advanced, accurate and timely solutions
available.

Information Services Industry

In today's technologically advanced and competitive business environment, companies are using vast amounts of customer, prospect and
marketplace information to manage their businesses. The information services industry provides a broad range of products and
services designed to help companies manage customer relationships. Acxiom's combination of technology, services, and premier data
content allow us to provide the customer information infrastructure that enables our clients to efficiently access and manage
information throughout the enterprise. We're doing this on an increasingly global scale as our clients ask us to provide the same
services we've delivered in the U.S. to their global efforts. The ability to create global solutions was the driving motivation
behind our recent acquisitions of Claritas Europe and Consodata, which solidified our presence in the European market.

Acxiom's services help our clients answer important business questions such as:

o Who are our existing customers?
o Who are our prospective customers?
o Who are our most profitable customers?

o What are the common traits of our existing customers?
o What do our customers want and when do they want it?
o How do we service our customers?
o How should we price our products and services?
o What distribution channels should we use?
o What new products should we develop or what old products should we retire?

We believe the current trends and dynamics of the information services industry will provide us with growth opportunities as
discussed below.

Information as an asset in Customer Relationship Management

More and more companies are realizing that the various types of data they gather and maintain - customer, product, financial, sales
and marketing - can be a competitive resource for acquiring and retaining customers, provided that the information is well
maintained and optimized throughout the organization. Gone are the days when companies thought they could buy a piece of Customer
Relationship Management (CRM) software and magically have better relationships with their customers. Today, companies understand
that CRM is a business strategy, not a piece of software, and that management of their information assets is one of the keys for
turning the promises of CRM success into reality. In fact, Gartner, Inc., a leading international industry analytical, research and
advisory =firm, reported recently that ignoring data quality is the #1 reason CRM fails.

A recent Gartner report entitled "The Nine Ways in Which CRM Will Change" (Scott Nelson, January 15, 2004) says that the key to
enterprises being able to deal effectively with their customers is to know them - who their customers are, what they want, why they
want it, and what the key levers are. It's also critical, says Gartner, to know how to use that information. The more enterprises
know about their customers, the more they can do with that information to improve the likelihood of sales and improve the levels of
service. Gartner predicts that enterprises will need to invest substantially more in analytics and accurate data. They found that
the average CRM solution currently devotes only about 10-12% of the total expenditures to issues of data, including capture,
storage, access and analysis. Their research suggests this will grow to 25% within five years (0.7 probability), and that some
organizations will need to spend even more.

Outsourcing managed services as a key growth area for CRM

Gartner predicts the CRM services market will climb to $22.2 billion by 2006, up from $14.8 billion in 2002, a compound annual
growth rate of 8.4%. Gartner expects outsourcing of CRM Services to be a key area for future growth. According to Gartner,
companies are recognizing that a focus on their core competencies yields a higher competitive advantage. Increasingly, these
companies are outsourcing non-core business processes and IT management. Managed services are consequently expected to be
high-growth areas in the professional services market in CRM.

Customer Data Integration recognized as "central to success" in CRM

Gartner reports that the CRM services market is moving toward process-focused solutions that allow enterprises to unite multiple
areas more easily. In the past, the CRM market has been focused heavily on features and functions. According to Gartner, this shift
will put increased emphasis on integration, middleware, databases, standards and interoperability. Gartner also concludes that
customer data integration (CDI) is central to success in process-centric CRM.

CDI can best be described as the combination of the technology, processes and services needed to create and maintain an accurate,
timely and complete view of the customer across multiple channels, business lines and, potentially, enterprises, where there are
multiple sources of customer data in multiple application systems and databases. In different ways, both the real-time enterprise
and business process fusion depends on having this "single view of the customer." The ability to successfully target, acquire,
develop and retain customers depends on the availability, at the time and place of need, of high quality, comprehensive, up to date
customer information and insight.

Gartner reports that the CDI category is a strong and healthily growing sector. By 2008, Gartner says, 50% of large enterprises with
a heterogeneous customer data environment will have started implementing a solution for CDI (0.7 probability); through 2010, fewer
than 33% of global enterprises will have a true enterprise view of the customer (0.7 probability), leaving significant room for
continued growth for the CDI sector.

Customer recognition becoming a paramount concern

How does a company know that the customer on the phone is the same one that was on its Web site one hour ago? Is it the same person,
or is it just someone using that customer's computer? Gartner concludes that enterprises need to have a federated ID system that
allows them to link up all interactions with a customer quickly and accurately. Such a constant ID system will be necessary, says
Gartner, to take advantage of an environment where technology is modified to that customer's desires and, in the process, enabling
the enterprise's CRM system to have a chance to truly support them. If an enterprise cannot be sure of who the customer is, and how
to link that customer to the database and profiles it has created, Gartner predicts that the enterprise's investments in CRM will be
seriously compromised.

Another application for Customer Recognition solutions is in a company's efforts to combat fraud and identity theft. As customer
contact channels proliferate and data volumes explode, the opportunity for fraudulent activity multiplies. Customer recognition
capabilities are an important tool to verify that customers are who they say they are. According to Gartner, consumers reported an
80% rise in identity-theft-related fraud from 2002 to 2003. And banks say the average value of a fraudulent transaction is $6,795.
At this pace it is logical to see why enterprise risk management is listed in a recent Gartner report as a top concern this year for
financial services firms.

Increasing amount of raw data to manage

The combination of demographic shifts and lifestyle changes, the proliferation of new products and services, and the evolution of
multiple marketing channels have made the information management process increasingly complex. Marketing channels now include cable
and satellite television, telemarketing, direct mail, direct response, in-store point-of-sale, on-line services and the Internet.
The multiplicity of these marketing channels has created more data and compounded the growth and complexity of managing data.
Advances in computer and software technology have also unlocked vast amounts of customer data, which historically was inaccessible,
further increasing the amount of existing data to manage and analyze. As these data resources expand and become more complex, it
also becomes increasingly difficult to integrate all the fragmented, disparate and often outdated information. The challenge to
obtaining accurate and complete customer data lies in obtaining, enhancing and integrating data from across an organization to form
a single, comprehensive view of individual customers.

Growth in technology partnering

Companies are increasingly looking outside of their own organizations for help in managing the complexities of their information
needs. The reasons for doing so include:

o allowing a company to focus on its fundamental business operations

o avoiding the difficulty of hiring and retaining scarce technical personnel

o taking advantage of world-class expertise in particular specialty areas

o benefiting from the cost efficiencies of outsourcing

o avoiding the organizational and infrastructure costs of building in-house capability

o benefiting more from the latest technologies

Evolution of one-to-one marketing

Advances in information technology, combined with the ever-increasing amounts of raw data and the changing household and population
profiles in the United States, have spurred the transition from traditional mass media to targeted one-to-one marketing. One-to-one
marketing enables the delivery of a customized message to a defined audience and the measurement of the response to that message.
The Internet has rapidly emerged as an ideal one-to-one marketing channel. It allows marketing messages to be customized to specific
consumers and allows marketers to make immediate modifications to their messages based on consumer behavior and response. The
Internet can also accomplish these objectives far more cost effectively than existing marketing media.

Competitive Strengths

We believe we possess the following competitive strengths which allow us to benefit from the industry trends described above and
offer solutions to the information needs of our clients:

Ability to design, build and manage large-scale databases, leveraging our Customer Information Infrastructure grid technology and
our Solvitur marketing database framework

We have extensive experience in designing, developing, managing and operating massively large-scale databases for some of the
world's largest companies, including AT&T Wireless, Allstate, CitiGroup, General Electric Capital Corporation, Federated
Department Stores, IBM and Sears. Our state-of-the-art data centers, computing capacity and operating scale enable us to access and
process vast amounts of raw data and cost effectively transform the data into useful information. We currently house more than 1,000
terabytes of disk storage for database solutions. A terabyte is approximately one trillion bytes, and is the scale often used when
measuring large computer storage.

We provide a complete solution that starts with consulting, integrates data content, applies data management technology and delivers
CRM applications to the desktop. Our open system environment allows our clients to use a variety of tools, and provides the greatest
flexibility in analyzing data relationships. This open system environment also optimizes our clients' requirements for volume,
speed, scalability and functional performance.

To complement our historical database expertise, Acxiom has developed its Customer Information Infrastructure grid computing
technology, which consists of a large collection of high-end PC's working together in an internal network. As a unit they provide
the functions of a traditional computer such as storage, computations, security, and data management at a fraction of the cost, with
significantly higher performance. It is Acxiom's ultimate goal to move most of its current client processing off mainframes and
dedicated servers to the Customer Information Infrastructure grid technology framework. Currently, nearly all of our clients are
having at least some work processed on the grid, and management is focused on rapidly moving as much customer processing to the grid
as possible.

Grid technology works by breaking down large jobs into smaller, separate tasks, then assigning them to computers linked together in
the grid. Large mainframe computers process jobs linearly, i.e., they must first complete one task before going on to the next.
Grids, on the other hand, can process separate tasks simultaneously, thereby providing much faster results. The grid system also
maximizes each computer's excess power capabilities, which typically are not fully utilized. Computers connected through the grid
can be called into service to assist other computers during peak workload periods, thereby making the most of their combined
available power. Utilization of the grid enables our clients to avoid multi-million dollar up-front investments in servers,
resulting in significant cost savings. In addition, the grid enables us to offer our services to a broader range of clients,
including companies whose processing needs are on a much smaller scale than that of our historical clientele. Processing time is
materially reduced using grid technology. For example, jobs that could take up to eight hours on a mainframe can be completed in 20
minutes in the grid. In addition, grid technology enables significantly more archived data to be housed on scalable, less expensive
data storage for long-range trending and analysis purposes.

With this expertise, Acxiom provides both traditional batch marketing solutions as well as real-time solutions, both via our
Solvitur marketing database framework. We believe that through this framework -- which leverages large-scale databases, the grid

technology, InfoBase and AbiliTec -- Acxiom is leading the industry in a fundamental shift from traditional linear campaigns to
continuous campaign management. We offer our clients weekly, daily and even real-time updates, thereby dramatically increasing the
frequency with which they can execute marketing campaigns. The competitive advantage that may be gained by our clients is improved
marketing offers that drive a greater response, in addition to increasing the timeliness of campaigns and the revenues generated.
Through our real-time marketing solutions, clients are able to get a consistent and immediately available customer view and decision
engine that helps them make effective, instantaneous marketing offers, based on comprehensive business rules, across all of their
front-office applications.

Our industry-leading Customer Data Integration products and services

We believe our Customer Data Integration capabilities, powered by AbiliTec, combined with the related real-time customer recognition
software and infrastructure, is the leading solution for companies seeking to better integrate their customer data and manage their
customer relationships. CRM involves analyzing, identifying, acquiring and retaining customers. Knowledge delivered directly and
immediately to a desktop or customer point of contact in real time is critical to the CRM process. Acxiom's Customer Data
Integration products and services are designed to fully meet these challenges for its clients.

As the basic infrastructure for integrated CRM solutions, AbiliTec allows the linking of disparate databases across a client's
business and makes possible personalized, real-time CRM at every customer touch-point. We believe that AbiliTec's unprecedented
scope, accuracy and speed contributes to Acxiom being established as the Customer Data Integration leader, both as an internal
processing tool and as the enabler of the single customer view that drives true, one-to-one marketing.

AbiliTec permits up-to-the-minute updating of consumer and business information with our data, thereby creating a new level of data
accuracy within the industry. By applying this unique, patented technology, we are able to properly cleanse data and eliminate
redundancies, update the data to reflect real-time changes, and combine our external data with our clients' internal data.

The financial benefits for our clients generated by faster processing times are multi-faceted. Our clients gain advantages from
AbiliTec by:

o Greatly improving the speed in which campaigns are brought to market in order to seize on opportunities more quickly.

o Leveraging shorter turnaround times to increase the frequency of data warehouse updates. With AbiliTec, some Acxiom clients
have moved from monthly to weekly updates, others from weekly to nightly, and some utilize the technology in an on-line
transaction processing ("OLTP") mode to update their data continuously, as new information becomes available.

o Basing marketing and other business decisions on more accurate data. In the world of customer or prospect data warehouses,
fresher information equals more accurate information. Integration of correct names and addresses also ensures more accurate
data is reflected for the customer or prospect.

We also believe that AbiliTec enables our clients to better serve the consumer privacy preferences of their customers. Just as
AbiliTec allows businesses to create a single view of their customers in real time for marketing purposes, it makes it much easier
for businesses to allow their customers to access, correct and selectively opt-out their information, provide better safeguards
around their customers' information, and facilitate the addition of information such as preference in time and manner of contact.

Real-time customer recognition software and infrastructure

Acxiom continues to expand its real-time multi-channel Customer Data Integration and customer recognition capabilities with products
and services such as Solvitur. This suite of software and infrastructure capabilities allows our clients, in real time, to integrate

their existing databases together in ways that have previously been difficult or impossible. Our Customer Data Integration and
customer recognition technologies allow our clients and us to integrate data directly into CRM applications, including:

o Customer analysis o Campaign management
o Interactive web pages o Point-of-sale
o Call centers o Customer service automation
o Direct mail o Sales force automation

Secure delivery of information over the Internet or via private network, as opposed to traditional delivery through CD-ROM, floppy
discs, tape cartridges or tapes, significantly reduces the turnaround time from days to minutes or sub-seconds and reduces the
operating costs associated with extended processing and turnaround.

Accurate and comprehensive data content

We believe that we have the most comprehensive and accurate collection of United States consumer, property and telephone marketing
data available from a single supplier. We believe we process more mailing lists than any other single company in the United States.
Our InfoBase consumer database contains approximately 17 billion data elements, which we believe covers over 95% of all households
in the United States. Our real estate database, which includes most major United States metropolitan areas, covers approximately 70
million properties in a majority of the states. We believe our InfoBase TeleSource product represents the most comprehensive
repository of accurate telephone number information for listed business and consumer telephone numbers in the United States and
Canada. Our clients use this data to manage existing customer relationships and to target prospective customers.

Acxiom's offerings in Europe are closely aligned with those in the U.S. The recent acquisitions of Claritas Europe and Consodata
S.A. have significantly enhanced Acxiom's offerings in terms of data services and customer information throughout Europe. Acxiom
provides leading customer information in the seven European countries in which it now has physical operations, including the United
Kingdom, France, The Netherlands, Germany, Spain, Portugal, and Poland. The customer information and segmentation offerings are
similar to Acxiom's InfoBase in the U.S. and in the U.K. While there are some differences between InfoBase in the U.S. and the U.K.
and differences country-to-country for the InfoBase equivalents that have been acquired with the Claritas Europe and Consodata
acquisitions, the core value proposition to Acxiom clients remains the same regardless of location.

In Australia, Acxiom is a leading supplier of consumer, business, telephone and property information for marketing purposes. Under a
range of brand names, Acxiom's data products are used by major financial institutions, telecommunications companies and retailers to
help them strengthen their customer relationships and grow their market share. Our clients use data from our databases to target
prospective customers and strengthen relationships with their existing customers.

Comprehensive IT Outsourcing Services

We offer clients comprehensive, integrated information management solutions tailored to their specific needs. Our total solution
approach is a competitive strength because it allows our clients to use a sole service provider for all of their information
management needs. Our information technology solutions cover the computing requirements of our clients, ranging from full mainframe
and midrange information processing centers to desktop applications. We currently operate several large mainframe and midrange data
centers, manage numerous networks and host Internet applications. We offer information management services in the following areas:

o Mainframe platform operations o Redundant infrastructure availability services

o Midrange and client/server platform o High-speed electronic printing and distribution
outsourcing services

o Network management o Web hosting management

Ability to attract and retain talent

We believe our progressive culture allows us to attract and retain top associates, especially those in technology fields where
critical technical skills are scarce. Our culture is based on concepts such as leadership, associate development, and continuous
improvement. Our business culture rewards customer satisfaction, associate satisfaction and profitability. In addition to our
culture, our extensive geographic presence, with locations in the United States, Europe, Australia and Japan, has enhanced our
ability to attract talented associates.

Acxiom has consistently been recognized for its leadership in a number of areas, including technical innovation and marketplace
excellence, and the company continued to receive such honors in 2003 and 2004.

Acxiom was named a finalist in the "Most Innovative Company" category by the 2004 American Business Awards for our development of
grid computing systems for large commercial applications, and Acxiom leaders were invited to speak at a number of prestigious
events, including the Grid Today 04 conference in Philadelphia, regarding this technology. Publications as diverse as Fortune,
Database Trends & Applications, and Internet Retailer have recognized Acxiom's leadership role in the new grid-based technology.

Significant awards Acxiom has announced since January 2003 include:

o Check Point Customer Excellence Award for cutting edge security practices

o The Data Warehousing Institute's Award for its 2004 "Best Practices in Data Warehousing" awards based on Acxiom's
leadership in grid computing

o Gold SMART Award for "Best Marketing Database Software" from British business magazine Direct Response

o U.S. Postal Service Special Achievement Award for promoting innovation and leadership in the industry

o Fortune magazine in January 2003 named Acxiom as one of the "100 Best Companies to Work For" in America, an honor the
company had received four previous years

o DM Review 100 honoree for the fourth consecutive year

o Torch Award for Marketplace Ethics from the Better Business Bureau of Arkansas

Growth Strategy

Using our competitive strengths, we are pursuing a strategy that includes the following initiatives:

Reinforce our leadership in building Customer Data Integration products and services, fully implement our Customer Information
Infrastructure grid technology, and leverage our consulting and analytics capabilities

Our primary initiatives are AbiliTec-driven Customer Data Integration solutions, including our real-time Solvitur solution, combined
with our traditional consulting and analytical services. We provide strategic consulting to our clients regarding creation and
measurement of CRM programs and the related infrastructure, particularly in the financial, banking and retail communities, and in
the privacy arena. Our Customer Information Infrastructure grid technology enables us to provide our clients with what we believe to
be the industry's most accurate and cost-effective means to integrate their customer and prospect data across the entire
organization. We then provide the capability to further enhance and add decision-making intelligence to that data with external
data, including our InfoBase data products. All of these Customer Data Integration processes can take place in a traditional batch
mode or in real time over the Internet or via private network.

Our technologies are available to a broad range of clients that desire to better manage their existing and prospective customer
relationships and to integrate disparate databases. We are continually developing AbiliTec-enabled solutions to improve data
quality, streamline production, reduce costs and increase the efficiency of our clients' marketing and database initiatives.

We are marketing AbiliTec, Solvitur and InfoBase through our internal sales organization as well as through our strategic alliances,
including leading CRM software solution providers such as IBM and SAS Institute, and systems integrators such as Accenture and IBM.
Each of these Acxiom products can be integrated directly into the decision systems offered by our strategic alliance partners to
enhance their unique value proposition to their customers. This alliance partner strategy provides the potential for us to extend
the scope of our services in our existing markets and expand our client base. We have developed the Opticx® process which allows
customers to rapidly determine their data quality and the potential return on their investment in our Customer Data Integration
solutions.

Encourage the sales and marketing of all of our products and services under the "One Acxiom" concept, thereby capturing
cross-selling opportunities

The "One Acxiom" concept reflects our commitment to more fully leverage and blend our core components - Customer Data Integration
technology, data, database services, IT outsourcing, consulting and analytics, and privacy leadership - to provide our clients the
most innovative and effective customer and information management solutions in the marketplace today. Our established client base is
primarily composed of Fortune 1000 companies. These clients use a single product or service or a combination of multiple products
and services. Our consultative approach, comprehensive set of services and products and long-standing client relationships, combined
with the increasing information needs of our clients, provide us with a significant opportunity to offer our existing client base
new and enhanced services and products.

Further penetrate existing and new client industries, and continue development of applications for fraud detection, risk management,
privacy and security

Our clients expect information management solutions tailored to the needs of their particular industry. We have developed specific
knowledge for the industries we serve, including the financial services, insurance, information services, direct marketing, media,
retail, technology, telecommunications, automotive, and pharmaceuticals/healthcare industries. We expect to continue to expand our
presence in these industries as well as to penetrate other industries as their information management needs increase. Other
industries which we believe are undergoing changes that will increase the need for data and information management services include
the e-commerce, packaged goods and entertainment sectors. We also believe our products and services would complement and are
adaptable to the identity verification systems of prospective clients in industries or businesses concerned about security
management, including travel, special events management and building security.

We also believe that in the post-September 11 environment, certain governmental agencies have a need for the type of data
integration solutions enabled by AbiliTec in the areas of fraud detection and identity verification. Since September 11, 2001, we
have been actively pursuing government contract work in this regard, and view this sector as a potential source of new business in
the future.

Continue to expand data content

We believe that the depth, breadth and quality of our data differentiates us in the marketplace. We continually enhance our
databases by adding new data through multiple sources and increasing the accuracy of the data through the use of AbiliTec. Expanding
our data content offerings enables us to grow existing client relationships, capture new clients and enter new industries. Data
content also represents an attractive business model for us because we can repackage it into multiple formats or sell it through
various distribution channels, at a minimal incremental cost.

Continue to pursue international opportunities, and expand our products and services so that our multinational clients can globally
utilize Acxiom offerings

Since 1986, we have had a presence in Europe, primarily in the United Kingdom and France. In the fourth quarter of fiscal 2004 we
significantly expanded our European operations through the acquisitions of Claritas Europe and Consodata S.A., two of Europe's
premier data providers with offices in The Netherlands, Germany, Spain, Portugal and Poland, as well as in France and the United
Kingdom. As a result of these acquisitions Acxiom is now well-positioned to help its international clients improve their marketing
effectiveness and prospecting results in the European markets. Among the existing clients of the acquired companies are some of the
world's most successful companies in the financial services, automotive, retail, consumer durables, mail order, publishing,
telecommunications, utilities, and travel and leisure industries. We expect to maintain these relationships, as well as acquire
additional multinational clients doing business in Europe. Similar to Acxiom's InfoBase products in the U.S., Claritas Europe's and
Consodata's combined products provide the largest source of consumer lifestyle databases and behavioral information available to
marketers across Europe. We intend to focus on the integration of these two new businesses into the "One Acxiom" business model, and
to continue to look for additional opportunities to expand our product and service offerings in the European marketplace.

Since 1999, we have been offering our products and services in Australia and New Zealand, including Customer Relationship Management
services, data warehousing, merge purge, analytics, InfoBase data, TeleAppend, Best Address, and verification. In 2000 we entered
the Japanese market by purchasing a minority interest in a Japanese consumer data firm. Our activities in Japan currently consist of
data hygiene, marketing campaign data and consulting services. We are in the process of localizing our product and service offerings
for the Japanese market and hope to expand our offerings through the Japanese offices of U.S. and European corporations and to large
Japanese firms which are active or which expect to be active in direct marketing and CRM strategies. Similar initiatives have been
undertaken in Latin America with the objectives of providing services to our global customers who are either already active in or
entering this marketplace. Our primary focus has been to develop infrastructure and build partner relationships in the major markets
- Mexico, Brazil, Argentina, Chile, and Columbia. To date, our efforts in Australia, Japan and Latin America have not resulted in
significant revenue generation.

Information concerning the revenues and assets of our foreign operations is included in Note 17 of the Notes to Financial Statements
which are attached to this Annual Report as part of the Financial Supplement.

Continue to seek alliances and acquisitions

Acxiom partners with many of the world's leading systems integrators and hardware and software companies, to create and distribute
the best customer and information management solutions for the market. Our partners include such companies as Accenture, D&B,
Equitec, Hewlett Packard, IBM Corporation, SAS Institute, TransUnion and USADATA.

We will continue to seek alliance opportunities with companies that can complement or expand our business by offering unique data
content, strategic services, or market presence in a new industry. We will also consider acquisitions as opportunities may arise. We
continually review our mix of businesses to determine that we have the correct combination of people, products, services and other
resources to allow us to best serve our clients.

Business Segments

We have three business segments: Services, Data and Software Products, and Information Technology Management. Information concerning
the financial results of our business segments and the total assets of each business segment is included in Note 20 of the Notes to
Financial Statements and in Management's Discussion and Analysis of Results of Operations and Financial Condition which are attached
to this Annual Report as part of the Financial Supplement.

Services

Our Services segment provides solutions that integrate and manage customer, consumer, and business data using our information
management skills and technology, as well as our InfoBase data products. We believe that AbiliTec, which provides Customer Data
Integration capabilities, together with our Solvitur marketing database solutions, positions us for a greater share of the growing
demand for integrated customer management solutions. Our Customer Information Infrastructure grid technology, AbiliTec linking
technology, Solvitur solutions, InfoBase data, and intellectual property for building and managing large-scale database environments
gives our clients the ability to reach their customers more rapidly, efficiently and accurately and to target their sales efforts
accordingly.

Acxiom builds Customer and Information Management solutions for its clients in the following service areas:

Service Description
o Marketing database and data warehouse o Develops strategies to effectively use and
design consulting transform data into actionable information
o Selects data elements that are relevant for a
particular client's goals and industry
o Lays foundation for data warehouse/database
development and marketing campaigns
o Data integration o Using AbiliTec-enabled solutions, provides
numerous Customer Data Integration services for a
diversity of business needs (see descriptions below
under Data and Software Products)
o Standardizes, converts, cleanses and validates
data to ensure accuracy and remove duplicative and
unnecessary data
o Creates accurate and comprehensive standardized
customer knowledge from disparate data sources
o Augments a client's data with our proprietary
data
o Data warehouse/database management and o Designs, models and builds data
delivery warehouse/database
o Provides data warehouse/database maintenance
and updates
o Delivers information through a variety of
channels, including the Internet via interactive
delivery
o Marketing applications o Provides market planning, analytical and
statistical modeling, campaign management, channel
implementation tracking and reporting applications
o Enables client to manage and monitor customer
relationships
o List processing o Provides processing tools to increase accuracy,
deliverability and efficiency of marketing lists
o Addresses and pre-sorts mailings to maximize
postal discounts and minimize handling costs
o Cleanses and integrates mailing list data

Data and Software Products

Our data and software products segment includes AbiliTec-Enabled Solutions, which provides our services segment the ability to more
effectively integrate and manage data, and our InfoBase data products, which include both business and consumer data.

AbiliTec-Enabled solutions

As discussed above, we believe that AbiliTec is the leading software solution for companies seeking to integrate and manage their
customer data and customer relationships. It allows the linking of separate, disparate databases across a client's business,
provides unprecedented speed and accuracy and permits real-time updating of consumer and business information. AbiliTec is a
software product that is licensed to our clients and that is sold through the following channels: enterprise, database, channel
partner, service bureaus and direct marketing.

The following AbiliTec-Enabled Solutions demonstrate the power of AbiliTec by delivering accurate, accelerated data solutions that
help businesses reduce costs, gain a better understanding of their customer base and build loyal, trust-based customer
relationships.

Product Description
o BestAddress o BestAddress is an address-processing product that
improves a mailing list's overall effectiveness by
optimizing address accuracy and deliverability.
BestAddress utilizes AbiliTec to deliver the most
complete address associated with each delivery point
and does so much faster than traditional address
erification processes.
o Consumer Preference Solution® o Consumer Preference Solution improves CRM efforts
by helping companies with legislative compliance and
with the management of consumer contact and
data-sharing preferences.
o Customer Data Integration (CDI) Services o Consumer Data Quality ("CDQ"): Designed for
companies with large mail volumes, CDQ identifies
duplicates within a mail file at a significantly better
hit rate than first generation merge/purge programs. As
a result, mail costs can be substantially reduced.
o Consumer Merge/Purge ("CM/P"): CM/P helps manage
the overall data integration process when records are
brought together from multiple sources. By rapidly
standardizing the data and files, CM/P recognizes and
groups individuals and households, appending
incremental data and creating output files based on
client business rules. CM/P enables data analysis and
other processes that support account acquisition
programs.

InfoBase, Sentricx® and Personicx® data products.

Based upon our knowledge of the industry and our competitors' products, we believe InfoBase, Sentricx and Personicx represent the
industry's most comprehensive and accurate relationship management, risk management, and operational efficiency data product
offerings. They are available either on a stand-alone basis or integrated into our customized service offerings.

The data that we use is obtained from publicly available information, public record information, summarized customer information,
customer contact information, and self-reported information. We utilize multiple data sources from each category of data including,
but not limited to, published telephone directories, directory service information, voter registrations, county assessor and
recorder information, questionnaires, warranty cards, inferred preference information, catalog buyer behavior information, and
product registration. Accuracy is one of Acxiom's primary concerns, and we have processes in place to maintain a high level of
quality in our products.

Our primary InfoBase products include the following:

Product Description
o InfoBase Enhancement o InfoBase Enhancement is the leading consumer data
enhancement product containing demographic and
lifestyle information on a majority of U.S.
households, and providing instant access to the
premiere multi-sourced database in the U.S.
InfoBase Enhancement processes customer data through
multiple delivery options including traditional or
"batch" processing for large volumes of data, or
online processing for smaller volumes or for instant
processing of individual records.

o InfoBase List o InfoBase List is a comprehensive multi-sourced
consumer list designed to help target prospects more
effectively and efficiently. InfoBase List consists
of base name and address records combined with
InfoBase's industry-leading consumer data including
demographics, home ownership characteristics,
purchase behavior and lifestyle data. Via online
access to our InfoBase Consumer Lists, clients may
obtain InfoBase-enhanced snapshots of their existing
records or host prospects for customer acquisition
and retention efforts quickly and inexpensively.

o InfoBase TeleSource and Address Append o InfoBase TeleSource is the most comprehensive,
multi-sourced telephone data product in the United
States. It allows clients to reach a greater number
of qualified customers and prospects. InfoBase
TeleSource's national database contains more than
157 million consumer names, telephone numbers and
addresses. This includes approximately 30 million
records not available from any other source and
approximately 12 million business listings.

o InfoBase Address Append is the most recent
addition to the InfoBase TeleSource product line.
InfoBase Address Append aids companies in their
customer recognition efforts by appending mailing
address information to consumer names and zip codes
captured at the point of contact. InfoBase Address
Append leverages two of the premier InfoBase
products, InfoBase TeleSource and InfoBase Consumer
List, to provide over 220 million unique name and
address listings to provide optimal coverage.

o InfoBase E-Mail Enhancement and E-Mail o E-Mail Enhancement allows businesses to
List communicate with their customers via e-mail. This
product also offers e-mail append, reverse append,
flag append, reactivation and eCOA (electronic
change of address).

o E-Mail List offers businesses an e-mail option for
prospecting by enhancing consumer-provided e-mail
information with demographics and lifestyle
selectors from Consumer Enhancement.

o InfoBase Analytics (Data Analysis o Data Analysis Report ("DAR") provides clients with
Report, Modeling Services and Scoring a comprehensive descriptive snapshot of their
Services) customers using InfoBase demographic and lifestyle
interest data. The DAR is currently provided as a
printed document, but is also available in online,
PC-compatible formats.

o Modeling Services involves the development of an
algorithm used to predict or model behaviors such as
a consumer's likelihood to respond to a particular
offer or to continue buying from a particular
vendor. The models are created utilizing
demographic data and/or internal customer data.

o Scoring Services is the application or
implementation of a model into useful information.
Once a model has been developed it is then applied
to an outside file or an Acxiom-specific file (e.g.,
InfoBase List). The file to which the model is
being applied is then scored, and all
records/households are ranked by score as to their
likelihood to behave in a certain manner (likelihood
of response, purchase propensity, attrition).
Scoring Services can be applied to both Acxiom files
or client-provided files.

o InfoBase Suppression o InfoBase Suppression facilitates our clients'
compliance with legal and industry privacy
guidelines, improves marketing results by
eliminating unresponsive prospects and those
unlikely to respond. InfoBase Suppression is built
from Acxiom's master suppression file, providing a
single access to a variety of suppression sources.
Unlike traditional methods of suppression which
require multiple passes of a marketer's list against
different suppression files, InfoBase Suppression
delivers numerous suppression options through a
single product.

o InfoBase Telephone Directories o InfoBase Telephone Directories provides several
content options for clients. InfoBase Business
Directories is the most complete source of business
listings for the U.S. and Canada consisting of over
20 million combined records. It is made up of the
most current business listings, with disconnected
numbers frequently removed. Along with address
information, records consist of business
classification, latitude/longitude, and yellow page
data elements. The InfoBase Premium White Page
("PWP") product is the premier product in the market
with public, but not yet published, listings
incorporated. It consists of multiple sources
including white page data, Regional Bell Operation
Companies data and monthly feeds of disconnected
data. The PWP file contains over 90 million records
with name and address information as well as
latitude and longitude.

o Personicx o Personicx represents the next evolutionary step in
consumer segmentation. Personicx is a
household-level segmentation system that places each
U.S. household into one of 70 segments based on its
specific consumer and demographic characteristics.
This provides a common framework for a business to
view its customers across its product mix and across
its organization. Personicx is driven by Acxiom's
InfoBase household data allowing for the Personicx
assignments to accurately reflect the dynamic nature
of today's households.

o Sentricx o Sentricx helps our clients combat fraud by
enabling data-driven identity verification of
customers and prospects. Sentricx accesses multiple
reference databases in real time or batch mode to
verify information provided at point-of-sale, in
call center or web environments, or on applications
for credit accounts, demand deposit accounts, or
insurance.

IT Management

Data center outsourcing enables our customers to focus on their core business while Acxiom manages their technical infrastructure
needs. We provide the IT services for large systems, midrange and client/server platforms and networks. These services are part of
Acxiom's total offering of Customer Information Infrastructure (CII) - the "One Acxiom" concept - combining data, technology,
marketing services and IT management to enable companies to maximize the value of customer relationships.

Our data center outsourcing services give our customers a secure, high-performance network and computing environment, supported by
experienced IT professionals. The benefits include:

o Maximization of value from IT assets and information system staff

o Computing and network capacity driven by customer demand

o Highly scalable computing and network environments

o "24 x 7" system availability

Our IT solutions cover the computing needs of our clients, ranging from full mainframe and midrange information processing centers
to desktop applications. Acxiom currently operates several large, high availability data centers, manages high-speed networks, and
hosts Internet e-commerce applications. Acxiom's IT services have the added specialty of supporting the very large databases needed
by companies who sell to consumers. Acxiom has developed a storage-centric IT infrastructure to manage the massive amounts of data
these companies require. Our leadership in grid-based Customer Information Infrastructure provides customers with a flexible and
scalable approach to on-demand access, management and updating of customer data for advanced analytics and database marketing.
Acxiom provides the infrastructure and managed services that power our customer and information management solutions.

We offer technology services in the following areas:

o Mainframe platform outsourcing
o Midrange and client/server platform outsourcing
o Network management
o Web hosting management
o High-speed electronic printing and mail services
o Redundant infrastructure availability services

Clients

Our ten largest clients represented approximately 43% of our revenues in fiscal 2004. No single client accounted for more than 10%
of our revenue during the last fiscal year. We seek to maintain long-term relationships with our clients. Many of our clients
typically operate under long-term contracts with initial terms of at least two years in length. We have historically experienced
high retention rates among our clients.

Sales and Marketing

Acxiom's sales and marketing organization takes a solution-selling approach that combines the full scope of Acxiom's strengths to
deliver solutions for clients that enhance profitability, reduce risk, and lower costs. Core offerings that are available in
Acxiom's solutions include data (under the InfoBase brand), technology and Customer Data Integration (under the AbiliTec brand),
database services (under the Solvitur brand), IT outsourcing, consulting and analytics, and privacy leadership (all under the
umbrella Acxiom brand).

The Acxiom sales and marketing organization has always maintained a strong focus on industry expertise to ensure we understand our
clients' unique business opportunities and challenges. This was enforced to a greater degree than ever in the past two fiscal years
as Acxiom has introduced and standardized a required and intensive training and "accreditation" process for associates in the sales
organization.

Acxiom continues to promote a sales and marketing-driven culture that encourages each associate to understand how he or she can
better promote the sale of Acxiom solutions and the satisfaction of our clients. It complements the strong product/service delivery
culture that has helped Acxiom succeed in the past. The sales and marketing-driven attitude extends across the enterprise, and sales
activities with major clients involve a high level of collaboration and cooperation across all levels of leadership in sales,
marketing and operations.

Also, as noted above, Acxiom partners with many of the world's leading systems integrators and hardware and software companies to
create and distribute the best customer and information management solutions for the market. Our partners include such companies as
Accenture, D&B, Equitec, Hewlett Packard, IBM Corporation, SAS Institute, TransUnion and USADATA. We will continue to seek
alliance opportunities with companies that can complement or expand our business by offering unique data content, strategic
services, or market presence in a new industry.

Pricing for Products and Services

We have standard pricing guidelines for many services such as list processing, national change-of-address processing, data
cleansing, merge/purge processing and other standard processing. Data warehousing/database management services tend to be more
custom-designed and are negotiated individually with each client utilizing standard pricing guidelines.

Pricing for data warehouses and database builds may include separate fees for design, initial build, ongoing updates, queries and
outputs. We also may price separately for consulting and statistical analysis services.

We publish standard prices for many of our data products. These products are priced with volume and license-period discounts.
Licenses for our entire consumer or business database for one or more years are priced individually.

AbiliTec is priced as software, and the right to use it is licensed to our clients, typically under one to three-year license
agreements. The pricing includes separate fees for the annual license and for individual transactions, if applicable. Both
components allow for volume price discounts. AbiliTec may also be utilized as part of an AbiliTec-enabled service and priced in a
bundled service solution.

IT Management services are priced based on the costs of migration, management services, operation of the data center, and network
and system infrastructure.

Competition

Although the information services industry in which we operate is highly competitive, we believe that we are the leader in our field
of expertise. Within the industry, there are data content providers, database marketing service providers, analytical data
application vendors, enterprise software providers, systems integrators, consulting firms, list brokerage/list management firms and
teleservices companies who compete with us. Many firms offer a limited number of services within a particular geographic area, and
several participants are national or international companies and offer a broad array of information services. However, we do not
know of a competitor that offers our complete line of products and services for Customer Information Infrastructure.

In the Services market, we compete primarily with in-house information technology departments of current clients, as well as firms
that provide data warehousing and database services, mailing list processing and consulting services. Competition is based on the
quality and reliability of products and services, technological expertise, historical experience, ability to develop customized
solutions for clients, processing capabilities and price. Competitors in the data warehousing and database services and mailing list
processing sectors include Harte-Hanks, Experian, and Merkle.

In the Data and Software Products market, we compete with two types of firms: data providers and list providers. Competition is
based on the quality and comprehensiveness of the information provided, the ability to deliver the information in products and
formats that the customer needs and, to a lesser extent, on the pricing of information products and services. Our principal
competitors in this market are Abacus Direct, Equifax, Experian, and infoUSA. We also compete with hundreds of smaller firms that
provide list brokerage and list management services. An emerging market is the Internet-driven data market. This consists of two
primary areas of emphasis: the use of the Internet to collect and deliver data and the use of e-mail addresses for reaching
consumers for marketing. The addition of the Internet into the traditional compilation and distribution channels has made the market
more diverse with potentially lower barriers to entry.

In Europe, Acxiom faces similar competition as in the United States in terms of the scope and type of competition. While there is a
broader range of competitors across Europe, particularly for customer data, the major competitors in the Services market and in the
Data and Software Products market are very similar to those that Acxiom has in the United States.

In the IT Outsourcing services market, competition is based on technical expertise and innovation, financial stability, past
experience with the provider, marketplace reputation, cultural fit, quality and reliability of services, project management
capabilities, processing environments, and price. Our primary competitors include Affiliated Computer Services, Electronic Data
Systems, IBM Global Services, (i)Structure and the in-house IT departments of current and prospective clients. In addition, but on a
less frequent basis, we compete with Computer Sciences Corporation, Lockheed Martin Information Technology and Perot Systems.

Privacy

We have always taken an active approach with respect to consumer privacy. The growth of e-commerce and companies' needs for consumer
information mean that we must work even harder to guarantee that our policies offer individuals the protection to which they are
entitled. Consequently, we actively promote a set of effective privacy guidelines for the direct marketing, e-commerce, and
information industries as a whole. Industry-wide compliance helps address privacy concerns across the globe. Furthermore, we are
certified under the European Union Safe Harbor and contractually comply with other international data protection requirements to
ensure the continued free flow of information across borders.

Our own Fair Information Practices Policy outlines the variety of measures we currently take to protect consumers' privacy. A copy
of this policy is posted on our website at www.acxiom.com. We educate our clients and associates regarding consumer privacy issues,
guidelines and laws. Our policy also explains the steps that consumers may take to have their names removed from our marketing
products and to obtain a copy of the information we maintain about them in our reference products.

Companies are assessing their privacy policies and beginning to recognize that newly developed customer data integration technology
can help them honor an individual's preferences and address consumers' concerns. We believe that technologies such as AbiliTec will
enable businesses to move beyond mere privacy "protection" and toward aggressive consumer advocacy. Just as AbiliTec allows
businesses to create a single view of their customers in real time for marketing purposes, it makes it much easier for businesses to
honor their customer's preferences and selectively opt out of certain practices, and provide better safeguards around their
customers' information.

Privacy legislation is currently pending in Congress and in most of the 50 states, and we anticipate that additional legislation
will continue to be introduced in the future. While there has been a significant amount of proposed legislation, we believe that as
legislators come to better understand the importance of information as a fundamental building block of a robust economy, reasonable
legislative approaches to information use will prevail. We are supportive of legislation that codifies the current industry
guidelines of notice and opt-out regarding whether or not a consumer's personal information is shared with independent third parties
for marketing purposes. We recognize that different types of personal information should be afforded varying safeguards, so with
regard to certain types of sensitive personal information, we support choice on an opt-in basis for third-party use.

Employees

Acxiom currently employs approximately 5,700 employees (associates) worldwide. None of Acxiom's U.S. associates are currently
represented by a labor union or are the subject of a collective bargaining agreement. To the best of management's knowledge,
approximately 50 associates in Europe are members of labor unions or work councils. Acxiom has never experienced a work stoppage and
believes that its employee relations are good.

CAUTIONARY STATEMENTS RELEVANT TO FORWARD LOOKING INFORMATION

This document, the documents that we incorporate by reference, and other written reports and oral statements made from time to time
by us and our representatives contain forward-looking statements. These statements, which are not statements of historical fact, may
contain estimates, assumptions, projections and/or expectations regarding our financial position, results of operations, market
position, product development, growth opportunities, economic conditions, and other similar forecasts and statements of expectation.
We generally indicate these statements by words or phrases such as "anticipate," "estimate," "plan," "expect," "believe," "intend,"
"foresee," and similar words or phrases. These forward-looking statements are not guarantees of future performance and are subject
to a number of factors and uncertainties that could cause our actual results and experiences to differ materially from the
anticipated results and expectations expressed in such forward-looking statements.

The forward-looking statements contained in this report include the items set forth on pages F-28 - F-29 in Management's Discussion
and Analysis of Financial Condition and Results of Operations ("MD&A") attached hereto. In light of the risks, uncertainties and
assumptions set forth in the MD&A, we caution readers not to place undue reliance on any forward-looking statements. We
undertake no obligation to publicly update or revise any forward-looking statements based on the occurrence of future events, the
receipt of new information or otherwise.

Item 2. Properties

Acxiom is headquartered in Little Rock, Arkansas with additional locations around the United States. It also has operations in
Europe, Australia and Japan. In general, our offices, customer service and data processing facilities are in good condition.
Construction on a new 97,000 sq. ft. office building and data center in Phoenix was begun last year and is expected to be completed
in the fall of 2004. Construction was recently begun on a new 30,000 sq. ft. data center in Little Rock. We believe that our
current facilities, together with those currently planned or underway, are adequate to meet our current needs. Other than the
possible consolidation of some of our European facilities and the establishment of another data center in Europe, we do not
anticipate that any substantial additional properties will be required during fiscal year 2005.

The following table sets forth the location, ownership and general use of the principal properties of Acxiom.

Location Held Use

Acxiom Corporation:

(a) Phoenix, Arizona Held in fee Customer service facilities; data center;
office space

(b) Conway, Arkansas Eleven facilities held in fee Customer service facilities; data center;
office space

(c) Little Rock, Arkansas Two leased buildings; one Principal executive offices; customer
building held in fee service facilities; office space

(d) Fayetteville, Arkansas Lease Office space

(e) Stamford, Connecticut Lease Office space

(f) Southfield, Michigan Lease Office space; data center

(g) Carmel, New York Lease Office space; data center

(h) Memphis, Tennessee Lease Customer service facilities; office space

(i) Tokyo, Japan Lease Office space

Acxiom / May & Speh, Inc.:

(a) Downers Grove, Illinois Lease Office space; data center; customer service
facilities

(b) Melville, New York Lease Office space; print facilities

Acxiom CDC, Inc.:

(a) Chicago, Lease Office space; data center
Illinois

Acxiom Information Security Services, Inc.:

(a) Independence, Ohio Lease Office space

Acxiom European Holdings, Ltd.:

(a) Kingston, England Lease Office space

(b) Leeds, England Lease Office space

(d) Orpington, England Lease Office space

(e) Sunderland, England Lease Office space; data center; warehouse space;
data processing and fulfillment service
center and fulfillment service center

(f) Teddington, England Lease Office space

(g) Lille, France Lease Office Space; data center

(h) Paris, France Lease Office space

(i) Frankfurt, Germany Lease Office space

(j) Munich, Germany Lease Office space

(k) Almere, Netherlands Lease Office space

(l) Leiderdorp, Netherlands Lease Office space

(m) Nieuwegein, Netherlands Lease Office space

(n) Warsaw, Poland Lease Office space

(o) Lisbon, Portugal Lease Office space

(p) Barcelona, Spain Lease Office space

(q) Madrid, Spain Lease Office space

Acxiom Australia Pty Ltd.:

(a) Sydney, Australia Lease Office space

Item 3. Legal Proceedings

We are involved in various claims and litigation matters that arise in the ordinary course of business. None of these, however, are
believed to be material in their nature or scope. See Note 11 of the Notes to Financial Statements which are attached to this Annual
Report as part of the Financial Supplement.

Item 4. Submission of Matters to a Vote of Security Holders

Not applicable.

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EXECUTIVE OFFICERS

Each of Acxiom's executive officers, including position held, age, and year of initial appointment as an executive officer and
business experience for the past five years, is listed below:

Name Position Held Age Year Elected

Charles D. Morgan Chairman of the Board and 61 1972
Company Leader

Rodger S. Kline Director and 61 1975
Company Operations Leader

James T. Womble Director and Client Services 61 1975
Organization Leader

David J. Allen Client Services Organization Leader 51 2000

Robert S. Bloom Company Financial Relations Leader 48 1992
& Treasurer

R. Bruce Carroll Strategic Development Leader 59 2001

Cindy K. Childers Company Organizational 44 2001
Development Leader

C. Alex Dietz Products and Infrastructure Technology Leader 61 1979

Scott D. Hambuchen Delivery Center Organization Leader 35 2004

L. Lee Hodges Outsourcing and IT Services Leader 57 1998

Richard K. Howe Products, Consulting & Marketing 42 2004
Organization Leader

Jerry C. Jones Company Business Development/Legal Leader 48 1999

Jefferson D. Stalnaker Company Financial Operations Leader 38 2002

Timothy Watts Delivery Center Organization Leader 45 2004

Kevin R. Zaffaroni European Organization Leader 50 2003

_________________________

Mr. Morgan joined Acxiom in 1972. He has been Chairman of the Board of Directors since 1975, and
serves as Acxiom's Company Leader. He is also a director and past Chairman of the Board of the Direct Marketing Association.
In addition, he serves as a member and is the past Chairman of the Board of Trustees of Hendrix College. He was employed by IBM
Corporation prior to joining Acxiom. Mr. Morgan holds a mechanical engineering degree from the University of Arkansas.

Mr. Kline serves as Acxiom's Company Operations Leader. He joined Acxiom in 1973 and has served as a director
of the Company since 1975. Mr. Kline holds a degree in electrical engineering from the University of Arkansas at Fayetteville,
where he has served since 1990 as Chairman of the College of Engineering Advisory Council. Prior to joining Acxiom, Mr. Kline
spent seven years with IBM Corporation and two years as an officer in the U.S. Army.

Mr. Womble joined Acxiom in 1974 and serves as a director of the Company as well as one of Acxiom's
Client Services Organization Leaders. Mr. Womble is also a director of Sedona Corporation. Prior to joining Acxiom, he was
employed by IBM Corporation. He holds a degree in civil engineering from the University of Arkansas.

Mr. Allen joined Acxiom in 1997. He currently serves as one of Acxiom's Client Services Organization
Leaders. Previously, he served as group leader in Acxiom's London office. Prior to joining Acxiom, he was employed by IBM and
EDS. Mr. Allen holds a bachelor's degree in biological sciences from the University of East Anglia (UK), where he graduated
with honors.

Mr. Bloom joined Acxiom in 1992. He currently serves as the Company Financial Relations Leader and
Treasurer. Prior to joining Acxiom, he was employed for six years with Wilson Sporting Goods Co. as chief financial officer of
its international division. Prior to his employment with Wilson, Mr. Bloom was employed by Arthur Andersen & Co. for nine
years, serving most recently as audit manager. Mr. Bloom, a Certified Public Accountant, holds a degree in accounting from the
University of Illinois.

Mr. Carroll joined Acxiom in 2000. He currently serves as Strategic Development Leader. Prior to joining
Acxiom, he was Senior Vice President of R.L. Polk, where he managed Polk's data engineering and market analysis group of
companies. Before its acquisition by Polk in 1996, he was President of Blackburn Marketing Services in Toronto, an information
technology conglomerate which included Canadian-based Compusearch and US-based Carfax. Prior to his nine years with Blackburn
and Polk, Mr. Carroll was President/CEO of Claritas Inc. for ten years, based in Washington, D.C., then was Managing Director
of Computerized Marketing Technologies in London. He holds undergraduate and graduate degrees in history and economics at
the University of Toronto.

Ms. Childers joined Acxiom in 1985. She currently serves as Company Organizational Development Leader. In this role, Ms. Childers
leads strategic planning and execution in such areas as business culture, organizational effectiveness, associate development,
recruiting, human resources and corporate communications. Previously, she served as leader of the Financial Services business
unit and oversaw all of the financial and accounting functions of the Company. Before joining Acxiom, she was a Certified
Public Accountant in audit and tax for KPMG Peat Marwick. Ms. Childers holds a bachelor's degree in business administration
from the University of Central Arkansas.

Mr. Dietz joined Acxiom in 1970 and served as a Vice President until 1975. Since that time, Mr. Dietz has served in a variety of
senior level management positions with Acxiom and currently serves as the Company's Products and Infrastructure Technology
Leader. Mr. Dietz holds a degree in electrical engineering from Tulane University.

Mr. Hambuchen joined Acxiom in 1992 as a software engineer and developed some of Acxiom's first
Windows-based GUI software applications. He currently serves as one of the Company's Delivery Center Organization Leaders.
Previously, Mr. Hambuchen was the Industry Solutions Group Leader for Acxiom's Multi-Industry Client Services Organization. He
also led operations in the United Kingdom, France and Spain. Mr. Hambuchen holds a degree in industrial engineering from the
University of Arkansas.

Mr. Hodges joined Acxiom in 1998 and currently serves as Outsourcing and IT Services Leader for the
Company. Prior to joining Acxiom, he was employed for six years with Tascor, the outsourcing subsidiary of Norrell Corporation,
most recently serving as a Senior Vice President. Prior to that time, Mr. Hodges served in a number of engineering, sales,
marketing and executive positions with IBM for 24 years. Mr. Hodges holds a bachelor's degree in industrial engineering from
Pennsylvania State University.

Mr. Howe joined Acxiom in 2004 as its Products, Consulting & Marketing Organization Leader. Prior to joining Acxiom, he was
employed by Fair Isaac & Company as a Business Unit Vice President managing all of Fair Isaac's Global Marketing
Solutions. From 1999 - 2001, Mr. Howe was the CEO and Chairman of the Board of ieWild Inc., a technology company with software
solutions at leading financial institutions, which was acquired by HNC Software, Inc. in 2001. From 1990 - 1999 Mr. Howe held
positions in product marketing, project management, sales management, software development and construction engineering. Mr.
Howe holds a bachelor's degree in structural engineering from Concordia University, Canada, and a master's degree in
engineering from McGill University, Canada.

Mr. Jones joined Acxiom in 1999 and currently serves as Business Development/Legal Leader for the
Company. Prior to joining Acxiom, he was employed for 19 years as an attorney in private practice with the Rose Law Firm in
Little Rock, Arkansas, representing a broad range of business interests. He is a member of the Board of Directors of Entrust,
Inc. and the Arkansas Virtual Academy. Mr. Jones holds a degree in public administration and a law degree from the University
of Arkansas.

Mr. Stalnaker currently serves as Acxiom's Financial Operations Leader. He joined the company in 1995
and during his tenure has served in a number of roles in the financial organization. Mr. Stalnaker served from 1998-2002 as the
financial leader of Acxiom's largest operating organization while also serving in a business development role for several key
clients. Prior to joining Acxiom, he was employed by the Arkansas Public Service Commission as a senior financial analyst.
Prior to that, Mr. Stalnaker worked for a regional public accounting firm located in Little Rock, Arkansas. He passed the
Certified Public Accountant exam and holds a degree in business administration in accounting from the University of Central
Arkansas.

Mr. Watts joined Acxiom in 1987 and currently serves as one of Acxiom's Delivery Center Organization
Leaders. In previous leadership roles at Acxiom, Mr. Watts was responsible for Acxiom's relationships with clients in the
financial, high-tech, insurance, investment/brokerage, media and telecommunications industries. Prior to joining Acxiom, Mr.
Watts was employed for five years with United Parcel Service in Dayton, Ohio. He attended the University of Cincinnati and
Wright State University in Dayton, Ohio.

Mr. Zaffaroni joined Acxiom in 1997. He is currently Acxiom's European Organization Leader. Prior to moving to London in his
current capacity, Mr. Zaffaroni was a Group Leader responsible for clients in a number of areas, including finance,
health care and government. Before joining Acxiom, he was employed for 22 years with IBM Corporation where he held several
management positions. He also served as Director of Systems Integration and Outsourcing Services for ISSC, the predecessor to
IBM Global Services. He holds a Bachelor of Science degree from Pennsylvania State University and has completed numerous
business courses including IBM's Advanced Management School.

There are no family relationships among any of Acxiom's executive officers and/or directors.

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PART II

Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

The outstanding shares of Acxiom's Common Stock are listed and traded on the NASDAQ National Market and trade under the symbol ACXM
The following table reflects the range of high and low closing prices of Acxiom's Common Stock as reported by Dow Jones &
Company, Inc. for each quarter in fiscal 2004 and 2003.

Fiscal 2004 High Low
Fourth Quarter $21.96 $18.60
Third Quarter 18.71 15.36
Second Quarter 17.46 15.07
First Quarter 16.87 12.93

Fiscal 2003 High Low
Fourth quarter 16.97 14.06
Third quarter 15.50 12.25
Second quarter 19.38 12.67
First quarter 17.78 14.90

We currently have approximately 2,310 stockholders of record.

On February 4, 2004 and May 26, 2004, the Acxiom Board of Directors declared quarterly dividend payments of $.04 per share on our
Common Stock for the quarters ending December 31, 2003 and March 31, 2004, respectively. Prior to 2004, we had never paid cash
dividends on our stock. While we expect to continue to pay quarterly dividends for the foreseeable future, all subsequent dividends
will be reviewed quarterly and declared by the Board in its discretion. In addition, our revolving credit facility imposes
limitations on our ability to pay dividends, including a restriction that we may not pay dividends in excess of $15 million in any
fiscal year.

The table below provides information regarding purchases by Acxiom of its Common Stock during the periods indicated.
-------------------- ----------------- ------------------ -------------------------- ---------------------------------
Maximum Number (or Approximate
Total Number of Shares Dollar Value) of Shares that
Total Number of Average Price Purchased as Part of May Yet Be Purchased Under the
Shares Paid per Share Publicly Announced Plans Plans or Programs
Period Purchased or Programs
-------------------- ----------------- ------------------ -------------------------- ---------------------------------
1/1/04 - 1/31/04 230,000 $18.88 230,000 $37,868,281
-------------------- ----------------- ------------------ -------------------------- ---------------------------------
2/1/04 - 2/29/04 217,500 18.70 217,000 33,794,906
-------------------- ----------------- ------------------ -------------------------- ---------------------------------
3/1/04 - 3/31/04 0 - 0 33,794,906
-------------------- ----------------- ------------------ -------------------------- ---------------------------------
Total 447,500 18.79 447,500 33,794,906
-------------------- ----------------- ------------------ -------------------------- ---------------------------------

The repurchases listed above were made pursuant to a repurchase program adopted by the Board of Directors on October 30, 2002, at
which time the Board authorized the repurchase of up to $50 million worth of shares of Acxiom's Common Stock. On February 5, 2003
the Board increased the cap to $75 million; on May 21, 2003 the Board increased the cap to $125 million; and on May 26, 2004 the
Board increased the cap to $200 million, subject to lender approvals. The repurchase program has no designated expiration date.

Item 6. Selected Financial Data

For information pertaining to Selected Financial Data of Acxiom, refer to page F-2 of the Financial Supplement, which is attached
hereto.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

The information required by this Item appears in the Financial Supplement at pp. F-3 - F-27, which is attached hereto.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

The Company's earnings are affected by changes in short-term interest rates primarily as a result of its revolving credit agreement,
which bears interest at a floating rate. The Company does not use derivative or other financial instruments to mitigate the interest
rate risk. Risk can be estimated by measuring the impact of a near-term adverse movement of 10% in short-term market interest
rates. If short-term market interest rates average 10% more during the next four quarters than during the previous four quarters,
there would be no material adverse impact on the Company's results of operations. The Company has no material future earnings or
cash flow expenses from changes in interest rates related to its other long-term debt obligations, as substantially all of the
Company's remaining long-term debt instruments have fixed rates. At both March 31, 2004 and 2003, the fair value of the Company's
fixed rate long-term obligations approximated carrying value.

As noted in note 3 to the consolidated financial statements, the Company completed the acquisition of the Claritas Europe group of
companies effective January 1, 2004; the Consodata companies based in England, France and Spain effective March 31, 2004; and in
April 2004 the Consodata German operation formerly known as 'pan-adress.' As a result of these acquisitions, the Company now has a
larger presence in the United Kingdom and a new presence in France, The Netherlands, Germany, Spain, Portugal and Poland. In
general, each of the foreign locations is expected to fund its own operations and cash flows, although funds may be loaned or
invested from the U.S. to the foreign subsidiaries. Therefore, exchange rate movements of foreign currencies may have an impact on
the Company's future costs or on future cash flows from foreign investments. The Company has not entered into any foreign currency
forward exchanges contracts or other derivative instruments to hedge the effects of adverse fluctuations in foreign currency
exchange rates.

Item 8. Financial Statements and Supplementary Data

The Financial Statements required by this Item appear in the Financial Supplement at pp. F-30 - F-65 , which is attached hereto.

Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

Not applicable.

Item 9A. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As required under the Sarbanes-Oxley Act of 2002, Acxiom carried out an evaluation as of March 31, 2004, under the supervision and
with the participation of its management, including the Registrant's Company Leader (Chief Executive Officer) and its Company
Financial Operations Leader (Chief Financial Officer), of the effectiveness of the design and operation of its "disclosure controls
and procedures," which are defined under SEC rules as controls and other procedures of a company that are designed to ensure that
information required to be disclosed by a company in the reports that it files under the Exchange Act is recorded, processed,
summarized and reported within required time periods. Based upon that evaluation, Acxiom's Company Leader and its Company Financial
Operations Leader concluded that the Company's disclosure controls and procedures were effective.

Changes in Internal Controls

There were no significant changes in Acxiom's internal controls or other factors that could significantly affect the controls
subsequent to the date of their evaluation.

PART III

Item 10. Directors and Executive Officers of the Registrant

Pursuant to general instruction G(3) of the instructions to Form 10-K, information concerning Acxiom's executive officers is
included under the caption "Executive Officers" at the end of Part I of this Report. The remaining information required by this Item
appears under the captions "Proposals You May Vote On," "Information About the Board of Directors," and "Section 16(a) Beneficial
Ownership Reporting Compliance" in Acxiom's 2004 Proxy Statement, which information is incorporated herein by reference.

The Acxiom Board of Directors has adopted a code of ethics applicable to our principal executive officer, principal financial
officer, principal accounting officer and all other persons performing similar functions. A copy of this code of ethics is posted on
Acxiom's website at www.acxiom.com under the Corporate Governance section of the site.

Item 11. Executive Compensation

The information required by this Item appears under the heading "Executive Compensation" in Acxiom's 2004 Proxy Statement, which
information is incorporated herein by reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required by this Item appears under the headings "Stock Ownership" and "Executive Compensation" Acxiom's 2004 Proxy
Statement, which information is incorporated herein by reference. The equity plan compensation information required by this Item
appears under the subheading "Equity Compensation Plan Information" in Acxiom's 2004 Proxy Statement, which information is
incorporated herein by reference.

Item 13. Certain Relationships and Related Transactions

The information required by this Item appears under the heading "Related-Party Transactions" in Acxiom's 2004 Proxy Statement, which
information is incorporated herein by reference.

Item 14. Principal Accountant Fees and Services

The information required by this Item appears under the heading "Fees Billed for Services Rendered by Independent Auditor" in
Acxiom's 2004 Proxy Statement, which information is incorporated herein by reference.

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PART IV

Item 15. Exhibits, Financial Statement Schedules and Reports on Form 8-K

(a) The following documents are filed as a part of this Report:

Financial Statements.

The following consolidated financial statements of the registrant and its subsidiaries included in the Financial Supplement
and the Independent Auditors' Reports thereof are attached hereto. Page references are to page numbers in the Financial
Supplement.

Page

Reports of Independent Auditors F-28 - F-29

Consolidated Balance Sheets as of March 31, 2004 and 2003 F-30

Consolidated Statements of Operations for the years ended
March 31, 2004, 2003 and 2002 F-31

Consolidated Statements of Stockholders' Equity and Comprehensive Income
for the years ended March 31, 2004, 2003 and 2002 F-32

Consolidated Statements of Cash Flows for the years ended
March 31, 2004, 2003 and 2002 F-33 - F-34

Notes to the Consolidated Financial Statements F-35 - F-65

Financial Statement Schedules.

All schedules are omitted because they are not applicable or not required or because the required information is included in
the consolidated financial statements or notes thereto.

Exhibits and Executive Compensation Plans.

The following exhibits are filed with this Report or are incorporated by reference to previously filed material.

Exhibit No.

3(a) Amended and Restated Certificate of Incorporati