Fiserv (FI) Q2 Earnings Surpass Estimates, Revenues Miss

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]