FORM 10-Q

ý Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

for the Period Ended April 30, 2004.

o 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 0-24201

Carreker Corporation

(Exact name of registrant as specified in its charter)

Delaware		75-1622836
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

4055 Valley View Lane, #1000 Dallas, Texas		75244
(Address of principal executive office)		(Zip Code)

(972) 458-1981

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

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 periods that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes ý No o

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practical date.

Common Stock, $.01 par value — 24,564,897 shares as of May 28, 2004.

CARREKER CORPORATION

Index

PART 1:		FINANCIAL INFORMATION

Item 1.		Financial Statements (unaudited)

		Condensed Consolidated Balance Sheets at April 30, 2004 and January 31, 2004

		Condensed Consolidated Statements of Operations for the three months ended April 30, 2004 and 2003

		Condensed Consolidated Statements of Stockholders’ Equity for the three months ended April 30, 2004

		Condensed Consolidated Statements of Cash Flows for the three months ended April 30, 2004 and 2003

		Notes to Condensed Consolidated Unaudited Financial Statements

Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 3.		Quantitative and Qualitative Disclosures about Market Risk

Item 4.		Controls and Procedures

PART II:		OTHER INFORMATION

Item 1.		Legal Proceedings

Item 2.		Changes in Securities and Use of Proceeds

Item 3.		Defaults Upon Senior Securities

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

Item 5.		Other Information

Item 6.		Exhibits and Reports on Form 8-K

SIGNATURES

PART I: FINANCIAL INFORMATION

Item 1. Financial Statements

CARREKER CORPORATION

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands, except per share amounts)

ASSETS

	April 30, 2004			January 31, 2004

Current assets
Cash and cash equivalents	$	31,486		$	28,605
Accounts receivable, net of allowance of $1,333 and $1,512 at April 30, 2004 and January 31, 2004, respectively	15,158			21,751
Prepaid expenses and other current assets	4,048			3,331
Total current assets	50,692			53,687

Property and equipment, net of accumulated depreciation of $17,953 and $17,140 at April 30, 2004 and January 31, 2004, respectively	6,099			6,690
Capitalized software costs, net of accumulated amortization of $11,290 and $11,050 at April 30, 2004 and January 31, 2004, respectively	2,699			2,028
Acquired developed technology, net of accumulated amortization of $12,308 and $11,153 at April 30, 2004 and January 31, 2004, respectively	13,392			14,547
Goodwill, net of accumulated amortization of $3,405 at April 30, 2004 and January 31, 2004	20,806			21,193
Customer relationships, net of accumulated amortization of $4,083 and $3,733 at April 30, 2004 and January 31, 2004, respectively	4,317			4,667
Deferred loan costs, net of accumulated amortization of $1,096 and $1,028 at April 30, 2004 and January 31, 2004, respectively	612			680
Other assets	694			1,087
Total assets	$	99,311		$	104,579

Current liabilities
Accounts payable	$	696		$	913
Accrued compensation and benefits	6,470			9,219
Other accrued expenses	5,650			4,520
Income tax payable	148			181
Deferred revenue	28,475			25,231
Accrued merger and restructuring costs	1,760			1,898
Total current liabilities	43,199			41,962
Long-term debt	—			6,250
Other long-term liabilities	196			49
Total liabilities	43,395			48,261

Commitments and Contingencies

Stockholders’ equity
Preferred stock, $.01 par value: 2,000 shares authorized; no shares issued or outstanding	—			—
Common stock, $.01 par value: 100,000 shares authorized; 24,411 and 24,357 shares issued at April 30, 2004 and January 31, 2004, respectively	244			244
Additional paid-in capital	109,167			108,757
Accumulated deficit	(53,492		)	(52,680		)
Less treasury stock, at cost: 1 common share at April 30, 2004 and January 31, 2004	(3		)	(3		)
Total stockholders’ equity	55,916			56,318
Total liabilities and stockholders’ equity	$	99,311		$	104,579

See accompanying notes.

CARREKER CORPORATION

Condensed Consolidated Statements of Operations

(Unaudited)

(In thousands, except per share amounts)

	Three Months Ended April 30,
	2004		2003

Revenues:
Consulting fees	$	9,057	$	6,751
Software license fees	5,856		6,578
Software maintenance fees	11,084		8,710
Software implementation fees	2,879		4,894
Out-of-pocket expense reimbursements	890		1,323
Total revenues	29,766		28,256

Cost of revenues:
Consulting fees	4,529		4,969
Software license fees	1,598		1,721
Software maintenance fees	3,798		3,176
Software implementation fees	3,369		4,855
Out-of-pocket expenses