Core Insights - FIS reported strong demand for core banking solutions, leading to recurring revenue growth and positive pipeline momentum [1][2] - The acquisition of Global Payments' issuing business (TSYS) is a strategic move that will enhance FIS' capabilities and cross-selling opportunities [1][6] Financial Performance - Recurring revenue growth accelerated to 4% in Q1 from 2%, with recurring revenue making up 81% of total sales [3] - Banking solutions segment revenues increased by 2% to $1.7 billion, while capital markets segment revenues grew by 9% to $764 million [3] Strategic Initiatives - The "Money at Rest" strategy remains strong, with expectations for solid sales growth driven by financial services consolidation [4] - The digital solutions segment is gaining traction as banks modernize their technologies, contributing to growth in the "Money in Motion" efforts [5] Future Outlook - FIS anticipates adjusted revenue growth of 4.2% to 5% in Q2, with banking revenue growth projected at 3.7% to 4.4% [7] - The acquisition of TSYS is expected to add $2.5 billion to operations, increasing annualized sales to a total of $9.4 billion on a pro forma basis [9] Market Positioning - FIS is uniquely positioned in the market with a comprehensive product suite that includes credit capabilities, enhancing cross-selling potential [6][11] - The company is not observing any slowdown in client spending, indicating robust market demand [8]

Core Insights - Fidelity National Information Services (FIS) reported quarterly earnings of $1.21 per share, exceeding the Zacks Consensus Estimate of $1.20 per share, and up from $1.10 per share a year ago [1] - The company achieved revenues of $2.53 billion for the quarter, surpassing the Zacks Consensus Estimate by 1.10%, and an increase from $2.47 billion year-over-year [3] Earnings Performance - The earnings surprise for the quarter was 0.83%, and FIS has surpassed consensus EPS estimates in all four of the last quarters [2] - The company had a previous quarter earnings expectation of $1.35 per share but reported $1.40, resulting in a surprise of 3.70% [2] Revenue Performance - FIS has topped consensus revenue estimates three times over the last four quarters, indicating strong performance in revenue generation [3] Stock Performance and Outlook - Fidelity National shares have declined about 3% since the beginning of the year, slightly better than the S&P 500's decline of 3.9% [4] - The company's future stock performance will largely depend on management's commentary during the earnings call and the sustainability of the recent earnings numbers [4] Earnings Outlook - Current consensus EPS estimate for the upcoming quarter is $1.42 on revenues of $2.58 billion, and for the current fiscal year, it is $5.74 on revenues of $10.47 billion [8] - The estimate revisions trend for Fidelity National is mixed, resulting in a Zacks Rank 3 (Hold), suggesting the stock is expected to perform in line with the market [7] Industry Context - The Financial Transaction Services industry, to which Fidelity National belongs, is currently in the top 35% of Zacks industries, indicating a favorable outlook compared to the bottom 50% [9]

Financial Data and Key Metrics Changes - The company reported adjusted revenue growth of 4% in Q1 2025, exceeding expectations [7][16] - Adjusted EBITDA was $958 million, leading to an EBITDA margin of 37.8% [16][17] - Adjusted EPS grew 11% to $1.21, at the upper end of the outlook [8][17] - Free cash flow conversion exceeded 70%, with free cash flow of $368 million compared to $95 million last year [17][18] - The company returned $670 million to shareholders through share repurchases and dividends [8][19] Business Line Data and Key Metrics Changes - Banking segment revenue grew 2%, with recurring revenue growth at 3% [20][21] - Capital Markets segment saw adjusted revenue growth of 9%, with recurring revenue growth of 6% [21][22] - Non-recurring revenue in Capital Markets advanced 47%, driven by strong license renewals [21][22] Market Data and Key Metrics Changes - The company signed several new marquee engagements across various sectors, indicating strong demand for core solutions [8][9] - The digital solutions segment gained traction, with a Midwest community bank selecting the Digital One product [10] - The company expanded its relationship with a multinational engineering firm, enhancing its Office of the CFO capabilities [11] Company Strategy and Development Direction - The strategic acquisition of the Issuer Solutions business and the sale of the Worldpay stake are aimed at strengthening the company's financial profile and value proposition [6][14][15] - The company is focused on driving commercial excellence and simplifying its portfolio to deliver consistent financial results [6][7] - The acquisition is expected to be accretive to adjusted EPS and enhance recurring revenue streams [15][70] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the pipeline and noted no negative impacts from macro factors on client spending [32][33] - The company reaffirmed its full-year outlook, anticipating continued strength in recurring revenue growth [8][24] - Management highlighted strong visibility into cost reduction initiatives and margin improvement for the second half of the year [81][84] Other Important Information - The company is targeting adjusted revenue growth of 4.2% to 5% for Q2 2025, with banking revenue growth projected at 3.7% to 4.4% [24][26] - The company expects to achieve a total shareholder return of 11% to 13% for the year [26] Q&A Session Summary Question: Feedback on client decision-making pipeline and Issuer Solutions business - Management reported positive feedback on client conversions and an increasing pipeline, indicating strong demand for services [31][32] Question: Insights on Capital Markets Q2 guidance - Management noted that the first quarter had a high non-recurring benefit, and the second quarter guidance reflects a return to normalized levels [40][41] Question: Banking segment performance and drivers for acceleration - Management emphasized strong visibility into banking revenue growth driven by high retention rates and a strong sales year in 2024 [88][90] Question: Free cash flow and net working capital optimization - Management highlighted significant improvements in cash flow driven by net working capital initiatives and procurement strategies [97][98] Question: Potential dis-synergies from Worldpay sale - Management confirmed there are no dis-synergies from the Worldpay business as all impacts were accounted for during the separation [108] Question: ACV growth in Q1 - Management indicated strong growth in ACV across the business, consistent with historical trends [113][114]

Financial Data and Key Metrics Changes - The company reported adjusted revenue growth of 4% in Q1 2025, exceeding expectations [8][18] - Adjusted EBITDA was $958 million, leading to an EBITDA margin of 37.8% [18] - Adjusted EPS grew 11% to $1.21, at the upper end of the outlook [10][18] - Free cash flow conversion exceeded 70%, with free cash flow of $368 million compared to $95 million last year [9][19] - The company returned $670 million to shareholders through share repurchases and dividends [10][19] Business Line Data and Key Metrics Changes - Banking segment revenue grew 2%, with recurring revenue growth at 3% [21] - Capital Markets segment saw adjusted revenue growth of 9%, with recurring revenue growth of 6% [22] - Non-recurring revenue in Capital Markets advanced 47%, driven by strong license renewals [22] Market Data and Key Metrics Changes - The company signed several new marquee engagements across the money lifecycle, indicating strong demand for core solutions [10][11] - The digital solutions segment gained traction, with a Midwest community bank selecting the Digital One product [12] - The Office of the CFO capabilities expanded, with a multinational engineering firm selecting FIS's treasury management solution [13] Company Strategy and Development Direction - The company is focused on driving commercial excellence and simplifying its portfolio, which is expected to deliver consistent financial results [7] - The strategic acquisition of the Global Payments Issuer Business and the sale of the minority stake in Worldpay are aimed at strengthening the financial profile and value proposition [7][16] - The acquisition is expected to be accretive to adjusted EPS, EBITDA margins, and free cash flow in the first twelve months [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the pipeline, noting that client spending remains strong despite macroeconomic factors [32] - The company reaffirmed its full-year outlook, anticipating continued strength in recurring revenue growth [9][24] - Management highlighted the importance of high retention rates and strong sales from the previous year as drivers for future growth [90] Other Important Information - The company is targeting adjusted revenue growth of 4.2% to 5% for Q2 2025 [24] - Capital expenditures were $233 million in Q1 2025, consistent with full-year expectations [19] - The company exited the quarter at a target leverage of 2.8 times [19] Q&A Session Summary Question: Feedback on client decision-making pipeline and Issuer Solutions business - Management noted that client conversions are live and the pipeline is increasing significantly year-over-year, with no signs of slowing spend [31][32] Question: Outlook for Capital One and Discover - Management expressed positive sentiments regarding partnerships with Capital One and Discover, indicating strong support for their initiatives [36] Question: Drivers for Capital Markets Q2 guidance - Management explained that the first quarter had a high non-recurring benefit, and the second quarter guidance reflects a return to normalized levels [40][41] Question: Banking segment's combined debit issuing business - Management indicated that the banking segment will see a significant increase in scale and recurring revenue due to the acquisition [45][46] Question: Worldpay EMI outlook - Management confirmed that the Worldpay EMI outlook remains consistent with expectations, with no signs of softening [50][51] Question: Cost synergies from the acquisition - Management highlighted that the largest cost synergies would come from rationalizing duplicate vendor costs and back-office optimization [58][60] Question: Accretion from Issuer Solutions transaction - Management stated that the transaction is immediately accretive and will significantly enhance cash flow and banking revenue [69][70] Question: Free cash flow and working capital initiatives - Management reported significant improvements in cash flow due to net working capital optimization initiatives [98][99] Question: Sales progress in capital markets - Management noted strong opportunities in both traditional and non-traditional verticals, with a robust pipeline and execution [106]

Financial Performance - Q1 2025 - Adjusted revenue grew by 4%[8, 17] - Adjusted EBITDA margin was 37.8%[8, 17], a decrease of 142 bps[17] - Adjusted EPS increased by 11% to $1.21[8, 17] - Adjusted Free Cash Flow was $368 million, representing a 71% conversion rate[18] Capital Allocation - $670 million was returned to shareholders in Q1 2025, including $450 million in share buybacks[8] - The company is confident in achieving its full-year (FY) free cash flow target[8] Segment Performance - Q1 2025 - Banking Solutions revenue grew by 3%, with recurring revenue up by 2%[20] - Capital Markets revenue grew by 6%, with recurring revenue up by 9%[20] - Banking Solutions adjusted EBITDA margin was 40.1%, a decrease of 379 bps[20] - Capital Markets adjusted EBITDA margin was 48.3%, an increase of 90 bps[20] FY 2025 Outlook (Reaffirmed) - Revenue is projected to be between $10.435 billion and $10.495 billion, representing adjusted revenue growth of 4.6% to 5.2%[21] - Adjusted EBITDA is expected to be between $4.305 billion and $4.335 billion, with a margin of approximately 41.3%[21] - Adjusted EPS is projected to be between $5.70 and $5.80, representing growth of 9% to 11%[21] Q2 2025 Outlook - Revenue is projected to be between $2.560 billion and $2.585 billion, representing adjusted revenue growth of 4.2% to 5.0%[21] - Adjusted EBITDA is expected to be between $1.020 billion and $1.035 billion, with a margin of 39.8% to 40.0%[21] - Adjusted EPS is projected to be between $1.34 and $1.38[21]

Core Viewpoint - Fidelity National Information Services, Inc. (FIS) is expected to report first-quarter 2025 results on May 6, 2025, with earnings estimated at $1.20 per share and revenues at $2.5 billion, indicating a year-over-year earnings increase of 9.1% and revenue growth of 1.7% [1][2] Financial Performance Estimates - The Zacks Consensus Estimate for FIS's 2025 revenues is $10.5 billion, reflecting a year-over-year rise of 3.4%, while the EPS for the current year is estimated at $5.74, indicating a growth of approximately 10% year-over-year [2] - FIS has consistently beaten consensus estimates in the last four quarters, with an average surprise of negative 9.4% [2] Earnings Prediction - The company is predicted to likely beat earnings this quarter, supported by a positive Earnings ESP of +0.76% and a Zacks Rank of 2 (Buy) [3] Revenue Breakdown - The consensus estimate for Banking Solutions revenues indicates a 1.3% year-over-year increase, while Capital Market Solutions is expected to see a revenue increase of around 7% compared to the same quarter last year [5] - Total Recurring revenues are projected to grow by approximately 1%, with North America and All Other revenues expected to grow by 1% and 2% year-over-year, respectively [6][7] EBITDA Estimates - The adjusted EBITDA for Capital Market Solutions is estimated to increase by 7.5% year-over-year, while total operating expenses are expected to decline by 2.8% year-over-year [7] - The company anticipates adjusted EBITDA to be in the range of $940-$960 million, with an adjusted EBITDA margin projected between 37.8-38.2% [9] Challenges - The adjusted EBITDA for Banking Solutions is expected to decline by 2.5% year-over-year, which may offset some positive growth factors [8]

For new and old investors, taking full advantage of the stock market and investing with confidence are common goals. Zacks Premium provides lots of different ways to do both.The research service features 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, all of which will help you become a smarter, more confident investor.Zacks Premium includes access to the Zacks Style Scores as well. What are the Zacks Style S ...

Investors interested in Financial Transaction Services stocks are likely familiar with Fidelity National Information Services (FIS) and Payoneer Global Inc. (PAYO) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank puts an emphas ...

Core Insights - Wall Street analysts anticipate Fidelity National Information Services (FIS) to report quarterly earnings of $1.20 per share, reflecting a year-over-year increase of 9.1% [1] - Expected revenues for the quarter are projected at $2.51 billion, which represents a 1.9% increase from the previous year [1] Earnings Estimates - The consensus EPS estimate has been revised 0.1% higher in the last 30 days, indicating a collective reevaluation by analysts [2] - Changes in earnings estimates are crucial for predicting investor reactions, with empirical studies showing a strong correlation between earnings estimate revisions and short-term stock performance [3] Revenue Forecasts - Analysts forecast 'Revenue- Banking Solutions' to reach $1.71 billion, indicating a year-over-year change of +1.3% [5] - 'Revenue- Corporate and Other' is expected to be $49.64 million, reflecting a significant year-over-year decline of -35.5% [5] - 'Revenue- Capital Market Solutions' is projected at $756.36 million, suggesting a year-over-year increase of +7.1% [5] Adjusted EBITDA Estimates - The average prediction for 'Adjusted EBITDA- Banking Solutions' is $720.66 million, compared to $745 million reported in the same quarter last year [6] - The consensus estimate for 'Adjusted EBITDA- Capital Market Solutions' is $360.18 million, up from $335 million in the previous year [6] Stock Performance - Shares of Fidelity National have shown a return of +4.2% over the past month, contrasting with the Zacks S&P 500 composite's -0.7% change [6] - With a Zacks Rank 2 (Buy), FIS is expected to outperform the overall market in the near future [6]

Core Insights - Fidelity National Information Services (FIS) is anticipated to report a year-over-year increase in earnings driven by higher revenues for the quarter ended March 2025 [1] - The consensus EPS estimate for FIS is $1.20 per share, reflecting a +9.1% change year-over-year, with expected revenues of $2.51 billion, up 1.9% from the previous year [3] - The company has a positive Earnings ESP of +0.88%, indicating a likelihood of beating the consensus EPS estimate, supported by a Zacks Rank of 2 [11] Earnings Estimates and Trends - The consensus EPS estimate for FIS has been revised 0.14% higher in the last 30 days, indicating a bullish sentiment among analysts [4] - The Most Accurate Estimate for FIS is higher than the Zacks Consensus Estimate, suggesting improved earnings prospects [10] - FIS has consistently beaten consensus EPS estimates in the past four quarters, with a surprise of +3.70% in the last reported quarter [12][13] Comparison with Industry Peers - MasterCard is expected to report an EPS of $3.57 for the same quarter, representing a +7.9% year-over-year change, with revenues projected at $7.13 billion, up 12.2% [17] - MasterCard's consensus EPS estimate has been revised 0.1% lower, resulting in a negative Earnings ESP of -0.05%, making it challenging to predict a beat on the consensus EPS estimate [18]