Fidelity National Q1 Earnings Beat on Improved Recurring Revenues

Core Viewpoint - Fidelity National Information Services, Inc. (FIS) reported strong first-quarter 2025 results, with adjusted earnings per share (EPS) of $1.21, exceeding estimates and showing an 11% year-over-year increase [1]. Financial Performance - Revenues reached $2.532 billion, a 3% year-over-year improvement, surpassing management's expectations [1]. - Adjusted EBITDA was $956 million, down 17.3% year over year, but still above estimates [4]. - The adjusted EBITDA margin decreased by 142 basis points to 37.8% [4]. Segment Performance - The Capital Market Solutions segment saw an 8% revenue growth to $764 million, with an adjusted EBITDA margin improvement of 90 basis points to 48.3% [6]. - The Banking Solutions unit generated $1.72 billion in revenue, growing 2% year over year, but the adjusted EBITDA margin fell by 379 basis points to 40.1% [5]. - The Corporate and Other segment's revenues dropped 36% year over year to $50 million, with an adjusted EBITDA loss of $99 million [7]. Cost and Expenses - Cost of revenues increased by 6% year over year to $1.7 billion [3]. - Selling, general and administrative (SG&A) expenses decreased by 2.6% to $558 million, although this was higher than estimates [3]. - Net interest expenses rose by 3.9% year over year to $80 million, but were lower than estimates [3]. Cash Flow and Equity - The company ended the quarter with cash and cash equivalents of $805 million, a 3.5% decline from the previous year [8]. - Total equity decreased by 4% to $15.1 billion [9]. - Net cash from operations was $457 million, more than doubling year over year, while adjusted free cash flows increased nearly four-fold to $368 million [9]. Shareholder Returns - Fidelity National returned $670 million to shareholders through share buybacks of $450 million and dividends of $220 million [11]. - Management aims for share buybacks of around $1.2 billion in 2025 and plans to align dividend growth with adjusted EPS growth [11]. Future Guidance - For Q2 2025, management forecasts revenues between $2.560 billion and $2.585 billion, with adjusted EBITDA projected at $1.020-$1.035 billion [12]. - For the full year 2025, revenues are expected to be between $10.435 billion and $10.495 billion, with adjusted EPS anticipated between $5.70 and $5.80, indicating a 10.2% growth from 2024 [13][14].