Earnings Performance - Fiserv reported mixed Q2 2024 results with adjusted EPS of $2.1, beating the consensus estimate by 1.9% and increasing 17.7% YoY [1] - Adjusted revenues of $4.8 billion missed the consensus estimate slightly but rose YoY [1] - Processing and services revenues of $4.1 billion increased 5.5% YoY but missed the estimate of $4.2 billion [3] - Product segment revenues of $967 million rose 16.2% YoY and exceeded the estimate of $911.7 million [3] Segment Performance - Merchant Acceptance revenues of $2.4 billion increased 9.2% YoY and met estimates [4] - Financial Solutions revenues of $2.4 billion rose 6% YoY and met estimates [4] - Merchant Acceptance adjusted operating margin was 36.6%, up 290 bps YoY [4] - Financial Solutions adjusted operating margin was 45.9%, flat YoY [4] Balance Sheet & Cash Flow - Fiserv ended Q2 2024 with $1.2 billion in cash and cash equivalents, flat QoQ [5] - Long-term debt increased to $24.4 billion from $23.8 billion in Q1 2024 [5] - Net cash from operating activities was $958 million, with free cash flow of $1 billion [5] - Capital expenditure was $420 million, and the company repurchased 10 million shares for $1.5 billion [5] 2024 Guidance - Fiserv raised its 2024 adjusted EPS guidance to $8.65-$8.80, with a midpoint of $8.73, higher than the consensus estimate of $8.69 [6] - The company increased its YoY EPS growth guidance to 15-17% from 14-16% [6] - Organic revenue growth is expected to be 15-17% YoY [6] Stock Performance - Fiserv stock gained 21.2% over the past year, outperforming the industry's 11% rally [2] Peer Performance - IQVIA Holdings reported Q2 2024 adjusted EPS of $2.6, beating the consensus estimate by 2.3% and increasing 2.4% YoY [8] - IQVIA's total revenues of $3.8 billion surpassed the consensus estimate and rose 2.3% YoY [8] - Omnicom Group reported Q2 2024 EPS of $1.95, beating the consensus estimate by 3.7% and increasing 7.7% YoY [9] - Omnicom's total revenues of $3.9 billion surpassed the consensus estimate by 1.1% and increased 6.8% YoY [9]

Financial Data and Key Metrics - Adjusted EPS for Q2 2024 was $2.13, up 18% YoY, driven by strong revenue growth and operating margin expansion [9] - Adjusted revenue growth was 7%, with organic revenue growth at 18% [9] - Adjusted operating margin increased by 160 basis points to 38.4% [9] - Free cash flow was $1 billion in Q2 and $4 billion over the last 12 months, with $1.5 billion returned to shareholders via share repurchases [11] - Full-year adjusted EPS outlook raised to $8.65-$8.80, up from $8.60-$8.75, with organic revenue growth guidance maintained at 15%-17% [23][54] Business Line Performance - **Merchant Solutions**: Organic revenue growth was 28% in Q2, driven by Clover revenue growth of 28% and small business volume growth of 4% [24][37] - Clover's annualized payment volume grew 17%, with value-added solutions (VAS) penetration at 20% [37] - Enterprise organic revenue growth was 27%, driven by transaction growth of 8% and higher VAS penetration [38] - Processing organic revenue declined by 7%, with year-to-date growth at 1% [39] - **Financial Solutions**: Organic revenue growth was 8% in Q2, with digital payments and issuing growing 8% and 9% respectively [46][47] - Zelle transactions grew 43%, and 32 FIs signed up for FedNow in Q2 [46] - Banking organic revenue grew 6%, excluding periodic revenue [50] Market Performance - **International Expansion**: Pilots for Clover in Brazil and Mexico set to go live in August, with Australia following in September [25] - In Brazil, instant payment transactions reached 400 million in Q2, up 21% from Q1 [44] - In EMEA, partnerships expanded with BNP Paribas, H&M Group, and Deutsche Bahn [41][42][43] - **Latin America**: Sequential volume growth in Brazil was over 20%, with Pix platform pilot going live [44] - **Asia Pacific**: Merchant acquiring services launched in New Zealand, targeting hospitality and retail segments [45] Strategic Initiatives and Industry Competition - The company is integrating solutions like CashFlow Central and Experience Digital (XD) to enhance revenue generation for clients [16][19] - New partnerships with Apple enable features like "pay with points" and installment loans on credit cards, enhancing consumer choice at checkout [20][21] - The company is leveraging its data capabilities, including the Fiserv Small Business Index, to provide actionable intelligence and anti-fraud solutions [64][65] Management Commentary on Operating Environment and Future Outlook - Management highlighted the company's ability to sustain double-digit organic revenue and EPS growth, with 2024 marking the 39th consecutive year of such growth [23] - The company is focused on expanding its global footprint, particularly in Brazil, Mexico, and Australia, with full ramp-up expected in 2025 [70][72] - Management expressed confidence in the resilience of the business model, citing strong demand for Clover, CashFlow Central, and other value-added solutions [110] Other Important Information - The company is celebrating its 40th anniversary and the 5th anniversary of the Fiserv-First Data merger, highlighting the success of the integration and the vision set in 2019 [12] - The company is investing in AI and data science, with plans to launch client-facing anti-fraud solutions in the fall [63][64] Q&A Session Summary Question: International expansion in Brazil and Mexico [70] - Pilots in Brazil and Mexico are set to go live in August, with full ramp-up expected in 2025 [70][72] - The company has a strong growth trajectory in Brazil, with expectations for continued performance [71] Question: Margin outlook and productivity [81] - The margin outlook was raised due to strong organic growth and ongoing productivity improvements [81] - The company expects continued margin expansion driven by scale and operational efficiency [82] Question: Small business and enterprise transaction growth [83] - Small business volume growth slowed in Q2, with July showing growth in line with Q2 expectations [89] - Enterprise transaction growth was impacted by declines in processing volumes, but overall performance remains strong [87] Question: CashFlow Central monetization [92] - CashFlow Central is expected to generate revenue through subscription fees and transaction fees, with strong demand from financial institutions [96] - The product is part of a broader SMB strategy, integrating Clover, digital banking, and other solutions [95] Question: Banking sub-unit growth [98] - Banking organic revenue grew 6%, driven by strong demand for services and Finxact wins [99] - The company expects sustainable growth in this segment, supported by ongoing client demand [98] Question: Financial solutions segment growth [101] - The financial solutions segment is expected to accelerate growth into 2025 and 2026, driven by CashFlow Central, XD, and Finxact [102] - Large client wins like Verizon and Target will contribute to growth in 2025 and beyond [104] Question: Merchant segment guidance and macro factors [106] - The company maintained its full-year organic growth guidance despite easing transitory benefits from Argentina [108] - Growth is supported by strong performance in Clover, value-added solutions, and CommerceHub [109] Question: Clover growth and customer retention [113] - Clover continues to outperform in terms of customer retention, with strong demand for value-added services [115] - The company is focused on expanding Clover's product set and vertical expertise [117] Question: M&A strategy [119] - The company remains focused on value creation through acquisitions, with no preference for public vs private targets [120] - The strategy is centered on leveraging the company's distribution channels and embedded finance capabilities [120]

Core Insights - The partnership between Fiserv and Apple aims to enhance Apple Pay functionality, introducing features like paying with loyalty points and installment loans at checkout [1][7] - Fiserv's Clover point of sale technologies are driving revenue growth, with a reported 29% increase in revenues year to date [2][4] - The company maintains an organic revenue growth outlook of 15% to 17% [3] Financial Performance - In the Financial Solutions segment, organic revenue growth was 8%, with digital payments revenue reaching $987 million [5] - Fiserv's Merchant Solutions business grew by 9% year over year to $2.4 billion on an adjusted basis, with small business-related revenues surging 13% [8] - Clover's annualized Gross Payment Volume (GPV) stands at $313 billion, reflecting a 17% increase [8] Market Trends - The EMEA region is experiencing improved business conditions as inflation eases and consumer confidence rises [9] - There is strong demand for faster payments in the U.S., with Fiserv signing 32 financial institutions to FedNow in the second quarter, totaling nearly 300 signups [9]

Fiserv (FI) reported $4.79 billion in revenue for the quarter ended June 2024, representing a year-over-year increase of 6.4%. EPS of $2.13 for the same period compares to $1.81 a year ago. Corporate and Other- Adjusted Revenue: $5 million versus $5.93 million estimated by six analysts on average. Compared to the year-ago quarter, this number represents a -28.6% change. Corporate and Other- GAAP Revenue: $318 million versus the five-analyst average estimate of $328.64 million. The reported number represents ...

[Q2 2024 Performance Highlights](index=1&type=section&id=Q2%202024%20Performance%20Highlights) Fiserv reported strong Q2 2024 financial results with significant GAAP and non-GAAP growth, raising full-year adjusted EPS outlook Q2 2024 Key Performance Indicators | Metric | Q2 2024 Growth | Year-to-Date Growth | | :--- | :--- | :--- | | GAAP Revenue | 7% | 7% | | GAAP EPS | 39% | 39% | | Organic Revenue | 18% | 19% | | Adjusted EPS | 18% | 18% | - The company affirmed its full-year 2024 organic revenue growth outlook of **15% to 17%** and raised its adjusted EPS outlook to a range of **$8.65 to $8.80**[1](index=1&type=chunk)[5](index=5&type=chunk) - CEO Frank Bisignano attributed the strong performance to Fiserv's integrated solutions, deep client relationships, and strategic market positioning[26](index=26&type=chunk) [Detailed Financial Results](index=1&type=section&id=Detailed%20Financial%20Results) This section details Fiserv's Q2 and YTD 2024 GAAP and non-GAAP financial performance, highlighting significant improvements [GAAP Financial Results](index=1&type=section&id=GAAP%20Financial%20Results) Fiserv's Q2 2024 GAAP results show revenue growth to $5.11 billion, 39% EPS increase, and expanded operating margin GAAP Financial Performance (Q2 & YTD 2024 vs 2023) | Metric (in millions) | Q2 2024 | Q2 2023 | YTD 2024 | YTD 2023 | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | $5,110 | $4,760 | $9,990 | $9,300 | | Operating Income | $1,430 | $1,130 | $2,610 | $2,070 | | Operating Margin | 28.0% | 23.8% | 26.1% | 22.2% | | Net Income | $894 | $683 | $1,630 | $1,250 | | Diluted EPS | $1.53 | $1.10 | $2.76 | $1.99 | - Net cash provided by operating activities for the first six months of 2024 increased by **8%** to **$2.17 billion**, up from **$2.01 billion** in the same period of 2023[2](index=2&type=chunk)[40](index=40&type=chunk) [Non-GAAP Financial Results](index=2&type=section&id=Non-GAAP%20Financial%20Results) Fiserv's Q2 2024 non-GAAP results show 18% organic revenue growth, 18% adjusted EPS increase, and 160 basis points margin expansion Non-GAAP Financial Performance (Q2 & YTD 2024 vs 2023) | Metric (in millions) | Q2 2024 | Q2 2023 | YTD 2024 | YTD 2023 | | :--- | :--- | :--- | :--- | :--- | | Adjusted Revenue | $4,790 | $4,460 | $9,340 | $8,690 | | Organic Revenue Growth | 18% | - | 19% | - | | Adjusted Operating Margin | 38.4% | 36.8% | 37.2% | 35.4% | | Adjusted EPS | $2.13 | $1.81 | $4.00 | $3.38 | - Free cash flow for the first six months of 2024 was **$1.48 billion**, roughly flat compared to **$1.47 billion** in the prior year period[4](index=4&type=chunk)[64](index=64&type=chunk) [Segment Performance](index=1&type=section&id=Segment%20Performance) Fiserv's Q2 2024 segment performance was driven by strong Merchant Solutions growth and steady Financial Solutions contributions - The company realigned its reportable segments in Q1 2024 into two new segments: Merchant Solutions and Financial Solutions. Prior period results have been recast for comparability[8](index=8&type=chunk)[26](index=26&type=chunk) [Merchant Solutions](index=1&type=section&id=Merchant%20Solutions) Merchant Solutions segment led growth with 28% organic revenue increase and 290 basis points GAAP operating margin expansion Merchant Solutions Performance (Q2 & YTD 2024) | Metric | Q2 2024 | YTD 2024 | | :--- | :--- | :--- | | GAAP Revenue Growth | 9% | 11% | | Organic Revenue Growth | 28% | 32% | | GAAP Operating Margin | 36.6% | 35.4% | [Financial Solutions](index=1&type=section&id=Financial%20Solutions) Financial Solutions segment achieved 8% organic revenue growth in Q2 and maintained a strong 45.9% adjusted operating margin Financial Solutions Performance (Q2 & YTD 2024) | Metric | Q2 2024 | YTD 2024 | | :--- | :--- | :--- | | GAAP Revenue Growth | 6% | 4% | | Organic Revenue Growth | 8% | 6% | | GAAP Operating Margin | 45.9% | 45.0% | | Adjusted Operating Margin | 45.9% | 45.0% | [2024 Full-Year Outlook](index=1&type=section&id=2024%20Full-Year%20Outlook) Fiserv updated its 2024 full-year guidance, reaffirming organic revenue growth and raising adjusted EPS outlook - The company continues to expect full-year organic revenue growth of **15% to 17%**[5](index=5&type=chunk)[47](index=47&type=chunk) Updated 2024 Adjusted EPS Outlook | Metric | Previous Outlook | Updated Outlook | Implied Growth | | :--- | :--- | :--- | :--- | | Adjusted EPS | Not specified in doc | $8.65 - $8.80 | 15% - 17% | [Capital Allocation](index=2&type=section&id=Capital%20Allocation) Fiserv actively returned capital to shareholders through its share repurchase program in Q2 and H1 2024 - Fiserv repurchased **10.0 million shares** of common stock for **$1.5 billion** in the second quarter of 2024[4](index=4&type=chunk) - In the first six months of 2024, the company repurchased a total of **20.2 million shares** for **$3.0 billion**[4](index=4&type=chunk) [Consolidated Financial Statements](index=6&type=section&id=Consolidated%20Financial%20Statements) This section presents Fiserv's condensed consolidated financial statements, including income statements, balance sheets, and cash flow statements [Condensed Consolidated Statements of Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) The income statement for Q2 and H1 2024 shows year-over-year growth in revenue, operating income, and net income, with 39% diluted GAAP EPS increase Six Months Ended June 30 (in millions) | Line Item | 2024 | 2023 | | :--- | :--- | :--- | | Total Revenue | $9,990 | $9,303 | | Operating Income | $2,609 | $2,065 | | Net Income Attributable to Fiserv | $1,629 | $1,246 | | Diluted EPS | $2.76 | $1.99 | [Condensed Consolidated Balance Sheets](index=12&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet as of June 30, 2024, shows total assets increased to $93.4 billion, accompanied by a rise in total liabilities Balance Sheet Highlights (in millions) | Line Item | June 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Total Current Assets | $38,327 | $34,811 | | Goodwill | $36,867 | $37,205 | | Total Assets | $93,417 | $90,890 | | Long-term Debt | $24,401 | $22,363 | | Total Liabilities | $64,639 | $60,221 | | Total Fiserv Shareholders' Equity | $28,154 | $29,857 | [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities increased to $2.17 billion in H1 2024, with major cash uses including treasury stock purchases Cash Flow Summary - Six Months Ended June 30 (in millions) | Line Item | 2024 | 2023 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $2,172 | $2,008 | | Capital Expenditures | ($768) | ($679) | | Net Cash Used in Investing Activities | ($1,207) | ($613) | | Purchases of Treasury Stock | ($3,230) | ($2,603) | | Net Cash Used in Financing Activities | ($1,114) | ($1,750) | [Non-GAAP Financial Measures & Other Information](index=3&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Other%20Information) This section details Fiserv's non-GAAP financial measures, including reconciliations to GAAP, and provides important forward-looking statements [Reconciliation of GAAP to Non-GAAP Measures](index=7&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Measures) This section reconciles GAAP to non-GAAP measures, detailing adjustments for a clearer view of core operational performance - Management believes non-GAAP measures enhance shareholders' ability to evaluate performance by providing additional insights into factors and trends affecting the business[10](index=10&type=chunk) - Common adjustments include amortization of acquisition-related intangible assets, merger/integration costs, severance costs, and certain tax items[29](index=29&type=chunk)[55](index=55&type=chunk) Reconciliation of Net Income to Adjusted Net Income (Q2 2024, in millions) | Description | Amount | | :--- | :--- | | **GAAP Net Income Attributable to Fiserv** | **$894** | | Amortization of acquisition-related intangible assets | $370 | | Merger and integration costs | $22 | | Severance costs | $21 | | Other adjustments | $26 | | Tax impact of adjustments | ($88) | | **Adjusted Net Income** | **$1,245** | [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) The report includes forward-looking statements on future financial performance, cautioning that actual results may differ due to various risks - Key risks include the ability to compete effectively, changes in customer demand, the impact of a security breach, economic conditions like inflation and interest rates, regulatory changes, and the ability to integrate acquisitions[14](index=14&type=chunk)[15](index=15&type=chunk) - The company assumes no obligation to update any forward-looking statements[15](index=15&type=chunk)

By the time the market catches on, these stocks might have already taken off. This is why investors must strategically adjust their portfolios to capitalize on the upside potential. With a small allocation set aside, investing in these sleeper stocks can be an incredibly rewarding decision. Source: Michael T Hartman / Shutterstock.com In Q1 FY24, revenue increased 8% year over year to $3.86 billion. Net earnings rose 18% year-over-year to $454 million, with adjusted EBITDA margin up more than 100 basis poin ...

Fiserv, Inc. (FI) is scheduled to release its second-quarter 2024 results on Jul 24, before market open. FI's earnings surprise history has been decent. It has surpassed the Zacks Consensus Estimate in three of the trailing four quarters and met in one, the average surprise being 2.3%. Q2 Expectations The Zacks Consensus Estimate for the top line is pegged at $4.8 billion, implying 7.4% growth from the yearago quarter's actual. The rise is anticipated to have been due to an increase in revenues from Clover ...

Chicago, IL – July 8, 2024 – Today, Zacks Equity Research discusses Fiserv, Inc. (FI) , Fidelity National Information Services, Inc. (FIS) , Global Payments Inc. (GPN) , WEX Inc. (WEX) and The Western Union Co. (WU) Industry: Financial Services The Zacks Financial Transaction Services industry is part of the Financial Technology or the FinTech space, including companies with diverse natures of businesses. The industry comprises card and payment processing and other solutions providers, ATM services and mone ...

Fiserv (FI) is a payment and financial services technology provider that has performed well over the past year and has the potential to sustain momentum in the near term. However, if you have not taken advantage of the share price appreciation yet, it's time you add the stock to your portfolio. What Makes FI an Attractive Pick? An Outperformer: A glimpse at the company's price trend reveals that the stock has had an impressive run over the past year. Shares of Fiserv have gained 16.8%, outperforming the 8.7 ...

Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor. Value Score Momentum traders and investors live by the saying "the trend is your friend." This investing style is all about taking advantage of upward or downward trends in a stock's price or earnings outlook. Employing factors like one-week price change and the monthly per ...