Fidelity National Information Services(FIS) - 2025 Q1 - Quarterly Report

Part I Item 1. Condensed Consolidated Financial Statements (Unaudited) Unaudited Q1 2025 consolidated financial statements detail financial position, earnings, and cash flows, post-Worldpay sale Condensed Consolidated Balance Sheets March 31, 2025 balance sheet reflects asset, liability, and equity changes, driven by Worldpay divestiture Condensed Consolidated Balance Sheet Highlights (in millions) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Assets | $32,841 | $33,784 | | Current assets held for sale | $— | $1,115 | | Goodwill | $17,328 | $17,260 | | Equity method investment | $3,795 | $3,858 | | Total Liabilities | $17,773 | $18,084 | | Long-term debt, excluding current portion | $8,658 | $9,686 | | Total Equity | $15,068 | $15,700 | Condensed Consolidated Statements of Earnings (Loss) Q1 2025 revenue grew 3% to $2.53 billion, but net earnings decreased due to prior year's discontinued ops gain Q1 Earnings Comparison (in millions, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $2,532 | $2,468 | | Gross Profit | $879 | $909 | | Operating Income | $347 | $355 | | Net Earnings (loss) from Continuing Operations | $78 | $0 | | Earnings (loss) from Discontinued Operations, net of tax | $— | $707 | | Net Earnings (loss) attributable to FIS | $77 | $706 | | Diluted EPS | $0.15 | $1.22 | Condensed Consolidated Statements of Cash Flows Q1 2025 net cash from continuing operations improved to $457 million, investing activities used $1.68 billion Cash Flow Summary (in millions) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities from continuing operations | $457 | $206 | | Net cash provided by (used in) investing activities from continuing operations | $(1,676) | $9,381 | | Net cash provided by (used in) financing activities from continuing operations | $(265) | $(9,446) | | Net cash provided by (used in) discontinued operations | $303 | $(345) | | Net (decrease) in cash | $(1,141) | $(246) | Notes to Condensed Consolidated Financial Statements Notes detail corporate actions: Worldpay divestiture and pending Global Payments Issuer Solutions acquisition - On Jan 31, 2024, FIS completed the sale of a 55% equity interest in its Worldpay Merchant Solutions business, now presented as discontinued operations, with FIS retaining a 45% non-controlling equity method interest[25][26] - On April 17, 2025, FIS agreed to acquire Global Payments' Issuer Solutions business for $13.5 billion and sell its remaining Worldpay interest to Global Payments for $6.6 billion, expected to close by H1 2026[104] - Due to the pending Worldpay stake sale, FIS no longer expects to receive $1.0 billion in contingent consideration from the original 2024 Worldpay sale and anticipates a non-cash loss of $108 million in Q2 2025[82][108] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q1 2025 financial performance, revenue growth, strategic shifts, and pending Global Payments deal Consolidated Results of Operations Q1 2025 revenue grew 3% to $2.53 billion, but gross profit and operating income slightly declined Consolidated Results of Operations (in millions) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $2,532 | $2,468 | 3% | | Gross Profit | $879 | $909 | (3)% | | Operating Income | $347 | $355 | (2)% | | Total other income (expense), net | $(117) | $(249) | NM | - The decrease in Other income (expense) in Q1 2025 compared to Q1 2024 is mainly due to a $174 million loss on extinguishment of debt recorded in the prior-year period[146] Segment Results of Operations Q1 2025: Banking Solutions revenue up 2% with margin decline; Capital Market Solutions up 8% with improved margin Banking Solutions Performance (in millions) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $1,718 | $1,685 | 2% | | Adjusted EBITDA | $688 | $739 | (7)% | | Adjusted EBITDA Margin | 40.1% | 43.9% | (380) bps | Capital Market Solutions Performance (in millions) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $764 | $706 | 8% | | Adjusted EBITDA | $369 | $335 | 10% | | Adjusted EBITDA Margin | 48.3% | 47.4% | 90 bps | Liquidity and Capital Resources As of March 31, 2025, FIS maintained $4.0 billion liquidity and $12.0 billion total debt, continuing capital return - The company has $4.0 billion of available liquidity as of March 31, 2025, including $0.8 billion in cash and $3.2 billion of available capacity under its Revolving Credit Facility[163] - In Q1 2025, the company repurchased a total of 6.2 million shares for approximately $450.3 million, with approximately $2.7 billion remaining available for repurchase under the August 2024 authorization[92][166][186] - A regular quarterly dividend of $0.40 per common share was declared, payable on June 24, 2025[165] Item 3. Quantitative and Qualitative Disclosure About Market Risk FIS faces market risks from interest rates and foreign currency, with 89% fixed-rate debt mitigating volatility - As of March 31, 2025, 89% of the company's debt was fixed-rate, and a 100 basis-point increase in variable-rate debt would increase annual interest expense by $13 million[178][179] - A hypothetical 10% adverse movement in foreign exchange rates would have resulted in a $26 million change in reported revenue for the three months ended March 31, 2025[181] Item 4. Controls and Procedures Management concluded disclosure controls were effective as of March 31, 2025, with no material internal control changes - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective as of the end of the period[183] - No changes in internal control over financial reporting occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, internal controls[184] Part II Item 1A. Risk Factors No material changes to the company's risk factors were reported compared to the Annual Report on Form 10-K - No material changes in risk factors were reported compared to the Form 10-K for the year ended December 31, 2024[185] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds In Q1 2025, FIS repurchased 6.2 million shares for $450.3 million, with $2.7 billion remaining for repurchase Share Repurchases for Q1 2025 | Authorization | Shares Purchased (millions) | Total Cost (millions) | | :--- | :--- | :--- | | January 2021 | 1.4 | $110.3 | | August 2024 | 4.8 | $339.8 | | Total | 6.2 | $450.1 | Item 5. Other Information No directors or executive officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements in Q1 2025 - No directors or executive officers adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the reporting period[187] Item 6. Exhibits This section lists various exhibits filed or furnished, including management certifications, compensatory arrangements, and XBRL data