Global Payments (GPN) came out with quarterly earnings of $3.26 per share, beating the Zacks Consensus Estimate of $3.23 per share. This compares to earnings of $3.08 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of +0.93%. A quarter ago, it was expected that this electronics payment processing company would post earnings of $3.03 per share when it actually produced earnings of $3.1, delivering a surprise of +2.31%.Over the las ...

Global Payments (NYSE:GPN) Q3 2025 Earnings Call November 04, 2025 08:00 AM ET Company ParticipantsNate Rosof - Head of Investor RelationsCameron Bready - CEOBob Cortopassi - President and COOJosh Whipple - CFOConference Call ParticipantsDan Dolev - AnalystDave Koning - AnalystAdam Frisch - AnalystDarrin Peller - AnalystJason Kupferberg - AnalystBryan Keane - AnalystAndrew Schmidt - AnalystOperatorLadies and gentlemen, thank you for standing by, and welcome to Global Payments' third quarter 2025 earnings co ...

Financial Data and Key Metrics Changes - The company reported adjusted net revenue of $2.43 billion for Q3 2025, a 6% increase from the prior year on a constant currency basis, excluding dispositions [31] - Adjusted operating margins expanded by 110 basis points to 45%, or 80 basis points excluding dispositions [32] - Adjusted earnings per share (EPS) was $3.26, reflecting a 12% increase on a reported basis and 11% on a constant currency basis [33] - Adjusted free cash flow for the quarter was approximately $784 million, representing a conversion rate of adjusted net income to adjusted free cash flow of approximately 100% [38] - The company reduced its net leverage position to 2.9 times at the end of Q3, down from 3.15 times at the end of Q2 [40] Business Line Data and Key Metrics Changes - Merchant solutions generated adjusted net revenue of $1.88 billion for the quarter, reflecting approximately 6% growth on a constant currency basis, excluding dispositions [33] - The POS and software business achieved high single-digit growth, excluding dispositions, for Q3 [33] - Issuer Solutions generated adjusted net revenue of $562 million for Q3, reflecting over 5% growth on a constant currency basis, marking an acceleration from the first half of the year [36] Market Data and Key Metrics Changes - The international markets demonstrated relative strength with high single-digit constant currency revenue growth across Central Europe and Asia-Pacific [35] - The company added nearly 60 new partners globally during the quarter, with about half of these new ISV partners located outside North America [35] Company Strategy and Development Direction - The company is focused on transforming into a pure-play merchant solutions provider, with the anticipated closing of the WorldPay acquisition and divestiture of Issuer Solutions in early 2026 [44][46] - A significant annual capital investment of approximately $1 billion is dedicated exclusively to merchant and commerce enablement solutions [45] - The integration of AI is enhancing the product development lifecycle, enabling faster innovation and improved velocity across the technology portfolio [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the trajectory of the business, expecting adjusted earnings per share growth to be at the high end of the 10%-11% range on a constant currency basis for the year [43] - The company anticipates continued strong free cash flow generation, with expectations to return $7.5 billion to shareholders between 2025 and 2027 [46] - Management noted that the macroeconomic backdrop remains stable, supporting the view that consumer spending is resilient [33] Other Important Information - The company closed the divestiture of its payroll business in September, allowing for an incremental $500 million of capital to be returned to shareholders through an accelerated share repurchase program [6] - The company partnered with Google to enable agentic commerce using the Agent Payments Protocol, enhancing secure and reliable commerce for customers [6] Q&A Session Summary Question: Thoughts on capital returns given the massive amount of free cash flow - Management expects to return close to $9 billion from dispositions and cash flow generation between 2025 and 2027, prioritizing capital returns to shareholders while also investing in business growth [50] Question: Insights on Genius wins and competitive landscape - Management indicated that initial wins with Genius are coming from both competitive takeaways and new customers, with a notable increase in new annual recurring revenue (ARR) since its launch [55][56] Question: Pricing environment and backbook sales - Management stated that the pricing environment remains constructive, focusing on value-based pricing rather than being the low-cost provider, while also harmonizing pricing structures across portfolios [62]

Financial Data and Key Metrics Changes - The company reported adjusted net revenue of $2.43 billion for Q3 2025, a 6% increase from the prior year on a constant currency basis, excluding dispositions [32] - Adjusted operating margins expanded by 110 basis points to 45%, or 80 basis points excluding dispositions, due to strong execution and transformation benefits [32] - Adjusted earnings per share (EPS) reached $3.26, reflecting a 12% increase on a reported basis and 11% on a constant currency basis [33] - Adjusted free cash flow for the quarter was approximately $784 million, representing a conversion rate of adjusted net income to adjusted free cash flow of nearly 100% [39] Business Line Data and Key Metrics Changes - Merchant solutions generated adjusted net revenue of $1.88 billion for the quarter, reflecting approximately 6% growth on a constant currency basis, excluding dispositions [33] - The POS and software business achieved high single-digit growth, excluding dispositions, with a notable increase in new Genius locations sold, seeing a 37% monthly increase since launch [34] - Issuer Solutions generated adjusted net revenue of $562 million for the third quarter, reflecting over 5% growth on a constant currency basis, marking an acceleration from the first half of the year [37] Market Data and Key Metrics Changes - International markets showed relative strength with high single-digit constant currency revenue growth across Central Europe and Asia-Pacific, benefiting from strong secular payment trends [36] - The macroeconomic backdrop remains stable, supporting the view that consumer spending is resilient [33] Company Strategy and Development Direction - The company is focused on transforming into a pure-play merchant solutions provider, with plans to close the WorldPay acquisition and divestiture of Issuer Solutions in Q1 2026 [4][5] - A partnership with Google was announced to enable agentic commerce, enhancing the company's capabilities in emerging commerce channels [5] - The company is investing approximately $1 billion annually in capital investment dedicated to merchant and commerce enablement solutions, aiming to accelerate product development and innovation [45][46] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the trajectory of the business, expecting adjusted earnings per share growth at the high end of the 10%-11% range on a constant currency basis for the full year [44] - The anticipated closing of the WorldPay acquisition is seen as a pivotal moment for the company's evolution, enhancing operational efficiency and maximizing cash flow [45] - Management highlighted the importance of leveraging increased scale and realizing meaningful synergies to generate significantly more leverage-free cash flow [46] Other Important Information - The company repurchased $500 million in shares during the third quarter, bringing total share repurchases to approximately $1.2 billion year-to-date [39] - The net leverage position was reported at 2.9 times at the end of Q3, down from 3.15 times at the end of Q2, indicating faster-than-anticipated deleveraging [40] Q&A Session Summary Question: Thoughts on capital returns given the free cash flow generation - Management reiterated the commitment to return capital to shareholders, expecting to return close to $9 billion from cash flow generated in the business between 2025 and 2027 [48] Question: Insights on Genius and competitive landscape - Management noted that the company is winning in various markets, with 90% of new sales to new customers and a significant increase in new annual recurring revenue since launching Genius [52][53] Question: Pricing environment and competitive actions - Management stated that the pricing environment remains constructive, focusing on delivering value rather than being the low-cost provider, while remaining price competitive [58][59] Question: Organic growth components and pricing increases - Management highlighted that organic growth is driven by new sales productivity and stable same-store sales trends, with ongoing efforts to harmonize pricing structures across portfolios [60][62]

3Q 2025 earnings Forward-looking statements This presentation may contain certain forward-looking statements within the meaning of the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, which are based on current expectations, estimates and projections about the industry and geographies in which we operate, and beliefs of and assumptions made by our management, involve risks, uncertainties and assumptions that could significantly affect the fi ...

Financial Performance - Consolidated revenues were $2,007.6 million for the three months ended September 30, 2025, a 0.5% increase from $1,997.7 million in the same period of 2024[124] - For the nine months ended September 30, 2025, consolidated revenues were $5,773.1 million, a 0.5% decrease from $5,802.8 million in 2024[133] - Operating income for the three and nine months ended September 30, 2025 was $778.0 million and $1,585.3 million, respectively, compared to $442.7 million and $1,277.7 million in the prior year, resulting in operating margins of 38.8% and 27.5%[142] - Income from continuing operations was $473.3 million and $928.7 million for the three and nine months ended September 30, 2025, compared to $303.9 million and $868.8 million for the prior year[149] - Diluted earnings per share for the three and nine months ended September 30, 2025 were $1.86 and $3.67, respectively, reflecting a decrease in diluted weighted-average shares outstanding to 240.2 million and 243.6 million shares[150] Segment Performance - The Merchant Solutions segment operating income for the three months ended September 30, 2025, increased by 6.0% to $749.99 million compared to $707.55 million in 2024[130] - The operating margin for the Merchant Solutions segment improved to 37.4% for the three months ended September 30, 2025, compared to 35.4% in 2024[130] - Revenues in the integrated and embedded solutions service line increased by $56.3 million (6.8%) and $158.6 million (6.7%) for the three and nine months ended September 30, 2025, respectively, while revenues in point of sale and software solutions decreased by $37.2 million (9.8%) and $110.5 million (9.6%) in the same periods[136] Expenses and Cost Management - Operating expenses for the three months ended September 30, 2025, decreased by 20.9% to $1,229.6 million from $1,554.9 million in 2024[130] - Selling, general and administrative expenses decreased by $84.6 million (10.8%) and $186.5 million (8.0%) for the three and nine months ended September 30, 2025, respectively, with expenses as a percentage of segment revenues at 34.9% and 37.2%[139][140] - The company incurred acquisition and transformation expenses of $205.1 million for the three months ended September 30, 2025[130] - Corporate expenses increased by $51.1 million (19.3%) and $161.1 million (23.6%) for the three and nine months ended September 30, 2025, primarily due to higher acquisition and transformation costs[141] Cash Flow and Capital Management - Cash and cash equivalents totaled $2,785.3 million as of September 30, 2025, with $1,304.1 million available for general purposes[160] - Operating activities provided net cash of $2,141.4 million for the nine months ended September 30, 2025, reflecting net income adjusted for noncash items[162] - Net cash from investing activities was $79.6 million for the nine months ended September 30, 2025, compared to a cash outflow of $846.6 million for the same period in 2024[163] - Cash used for acquisitions was $201.9 million in 2025, down from $373.8 million in 2024, while capital expenditures were $449.6 million in 2025 compared to $490.9 million in 2024[163] - The company anticipates capital expenditures to be approximately $700 million for the year ending December 31, 2025[163] Financing Activities - Net cash used in financing activities was $2,126.0 million for the nine months ended September 30, 2025, significantly higher than $446.0 million in 2024[164] - Proceeds from long-term debt were $4,899.1 million in 2025, down from $7,637.9 million in 2024, while repayments were $5,972.8 million in 2025 compared to $5,803.0 million in 2024[165] - The company repurchased 13,171,490 shares of common stock for $1,191.1 million during the nine months ended September 30, 2025, at an average price of $84.61 per share[168] - Dividends paid to common shareholders were $179.5 million in 2025, a decrease from $190.5 million in 2024[169] Strategic Initiatives and Acquisitions - The company expects transformation initiatives to generate over $650 million of annual run-rate operating income benefit by the first half of 2027[120] - The company completed the sale of Heartland Payroll Solutions for approximately $1.1 billion, recognizing a gain of $343.9 million during the three months ended September 30, 2025[117] - The proposed acquisition of Worldpay involves approximately $6.1 billion in cash and 43.3 million shares of common stock, with a simultaneous divestiture of the Issuer Solutions business for approximately $7.5 billion in cash[117] - The company plans to complete the acquisition of Worldpay and divest its Issuer Solutions business, with expectations of future financial and operational benefits[187] - The company’s future performance and strategic initiatives are contingent on successful integration of acquisitions and operational initiatives[187] Risk Factors and Forward-Looking Statements - The company acknowledges that actual revenues and growth rates may differ materially from forward-looking statements due to various risks and uncertainties[188] - The company emphasizes the importance of reviewing risk factors discussed in its Annual Report on Form 10-K for the year ended December 31, 2024[188] - Forward-looking statements are subject to significant risks and uncertainties, and the company disclaims any obligation to publicly update these statements[189] - The company cautions against placing undue reliance on forward-looking statements, which are only valid as of their date[189] - The company’s market risk exposure is discussed in its Annual Report on Form 10-K for the year ended December 31, 2024[190]

Exhibit 99.1 Global Payments Reports Third Quarter 2025 Results November 4, 2025 ATLANTA -- Global Payments Inc. (NYSE: GPN) today announced results for the third quarter ended September 30, 2025. "We are pleased to deliver third quarter results that accelerated sequentially across our key financial metrics as we advance our transformation program," said Cameron Bready, chief executive officer. "Our team continues to execute at a high level, positioning us well to deliver on our overall expectations for the ...

Analyst Ratings & Company Performance - Rothschild analyst Dominic Ball maintains a sell rating on Fire Serv, which has declined by 70% since the rating was issued [1][2] - Only 5% of analysts on the Bloomberg terminal issue sell ratings [3] - Global Payments is also rated as sell by only 6% of analysts covering it [9] - Fire Serv stock is down 40% over the past five years, while Global Payments is down 50% over the same period [16] Company Strategy & Challenges - Fire Serv's Clover product (a point of sale system) is facing issues, indicating a systemic problem [2] - Management at Fire Serv has focused too aggressively on Clover, potentially underinvesting in other areas [7] - Companies that have grown through M&A face challenges in consolidating and focusing R&D on new technologies [8][10][11] - Payments industry faces rapid technological changes, including the emergence of gig commerce and stablecoins [8] Competitive Landscape & Opportunities - Toast is highlighted as a strong competitor with a focused approach and significant market share gains in the restaurant vertical [9][14] - Toast is considered materially underrated, with the potential for significant growth and high margins [15] - Analyst has a target price of $60 for Toast, which IPO'd when interest rates were near 0% [17] - Toast has scaled to 35% EBIT margins within 18 months while adding more locations [18]

Core Viewpoint - Fiserv's stock price collapse is primarily attributed to management failures, including poor pricing strategies, overpromising growth, and a sluggish corporate culture in responding to customer needs [2][3][4]. Financial Performance - The new CEO Mike Lyons revised the adjusted EPS forecast for the year from $10.15-$10.30 to $8.50-$8.60, a reduction of over 16%. Revenue growth expectations were cut by more than half, from 10% to 3.5%-4% [2]. - In Q3, Fiserv's revenue grew only about 1% year-over-year to $4.92 billion, falling short of the expected $5.36 billion by over 8%. The adjusted EPS was $2.04, nearly 23% below the anticipated $2.64 [2]. Management Issues - The crisis reflects a failure of management rather than a technical failure, with the previous CEO setting overly aggressive growth targets and implementing a pricing strategy that led to significant customer attrition [3][9]. - Lyons acknowledged that the challenges faced were largely self-inflicted, stemming from short-term focused initiatives that compromised the company's ability to deliver products to customers [9][10]. Customer Reactions - Customers expressed dissatisfaction with the high fees associated with Clover's payment terminal system, leading many to switch to cheaper alternatives like Square or Toast [7][8]. - Analysts raised concerns about the sustainability of Clover's revenue growth, noting that its revenue growth was outpacing the growth in payment volume, which typically should align [8]. Analyst Reactions - Analysts reacted swiftly to Fiserv's poor performance, with BTIG describing the financial results as "astonishingly bad" and other analysts expressing disbelief at the magnitude of the earnings miss and guidance cut [11]. - Mizuho's analyst maintained a cautiously optimistic outlook, comparing the situation to a medical emergency that could lead to recovery if managed properly [11]. Strategic Changes - Fiserv announced several remedial measures, including reversing pricing changes for Clover, launching a new technology strategy, and making significant leadership adjustments [11][13]. - The company appointed a new CFO and introduced new board members to help steer the organization through this crisis [12][13]. Market Implications - The situation serves as a warning that even entrenched companies in the digital economy can collapse due to management missteps, especially in a competitive landscape with decreasing investor tolerance [4][13].

Core Viewpoint - Fiserv has been downgraded to "Market Perform" by William Blair due to disappointing third-quarter financial results, which included significant misses in earnings and revenue forecasts [1][6]. Financial Performance - Fiserv's shares have declined nearly 45% following the release of its third-quarter 2025 financial results, with the stock priced at $76.55 at the time of downgrade [1][2]. - The company reported earnings per share (EPS) of $2.04, falling short of the anticipated $2.65, contributing to the downgrade [2][6]. - Revenue for the quarter was $4.92 billion, missing the forecasted $5.36 billion, prompting a revision of the full-year 2025 guidance [3][6]. - Fiserv now projects adjusted EPS between $8.50 and $8.60, down from the expected $10.07, and has adjusted its organic revenue growth forecast to 3.5% to 4%, significantly lower than the previous estimate of approximately 10% [3][6]. Strategic Initiatives - In response to the financial challenges, Fiserv has launched the "One Fiserv" action plan aimed at enhancing client focus and leveraging the company's strengths [4][6]. - Despite the overall disappointing performance, Fiserv's net income increased to $792 million from $564 million in the same period last year, indicating some positive aspects amidst the challenges [4][6]. Market Data - The current stock price of Fiserv is $75.98, reflecting a significant decrease of $50.19, or 39.78% [5]. - The stock has fluctuated between a low of $66.58 and a high of $76.64 on the day of reporting, with a market capitalization of approximately $41.3 billion and a trading volume of 63.6 million shares [5].