GAAP revenue growth of 7% and organic revenue
growth of 20%;
GAAP EPS increased 39% and adjusted EPS
increased 19%;
Company affirms 2024 organic revenue growth
outlook of 15% to 17%
and raises adjusted EPS outlook to $8.60 to
$8.75
Fiserv, Inc. (NYSE: FI), a leading global provider of payments
and financial services technology solutions, today reported
financial results for the first quarter of 2024.
First Quarter 2024 GAAP Results
GAAP revenue for the company increased 7% to $4.88 billion in
the first quarter of 2024 compared to the prior year period, with
13% growth in the Merchant Solutions segment and 3% growth in the
Financial Solutions segment.
GAAP earnings per share was $1.24 in the first quarter of 2024,
an increase of 39% compared to the prior year period. GAAP
operating margin was 24.2% in the first quarter of 2024 compared to
20.5% in the first quarter of 2023. GAAP operating margin was 34.1%
in the Merchant Solutions segment and 44.1% in the Financial
Solutions segment in the first quarter of 2024, compared to 29.7%
and 42.4% in the first quarter of 2023, respectively. Net cash
provided by operating activities was $831 million in the first
quarter of 2024 compared to $1.13 billion in the prior year
period.
“Fiserv extended its strong revenue growth and margin expansion
into 2024 leading to 19% adjusted earnings per share growth in the
first quarter,” said Frank Bisignano, Chairman, President and Chief
Executive Officer of Fiserv. “We continued to execute on our
resilient business model by improving productivity, delivering
innovative products and services, and cross-selling into our
diverse and high-quality client base.”
First Quarter 2024 Non-GAAP Results and Additional
Information
- Adjusted revenue increased 7% to $4.54 billion in the first
quarter of 2024 compared to the prior year period.
- Organic revenue growth was 20% in the first quarter of 2024,
led by 36% growth in the Merchant Solutions segment and 5% growth
in the Financial Solutions segment.
- Adjusted earnings per share increased 19% to $1.88 in the first
quarter of 2024 compared to the prior year period.
- Adjusted operating margin increased 180 basis points to 35.8%
in the first quarter of 2024 compared to the prior year
period.
- Adjusted operating margin increased 440 basis points to 34.1%
in the Merchant Solutions segment and increased 160 basis points to
44.1% in the Financial Solutions segment in the first quarter of
2024, compared to the prior year period.
- Free cash flow was $454 million in the first quarter of 2024
compared to $861 million in the prior year period.
- The company repurchased 10.2 million shares of common stock for
$1.5 billion in the first quarter of 2024.
- The company completed a public offering of $2.0 billion of
3-year, 7-year and 10-year senior notes with a weighted average
interest rate of 5.313%.
- Fiserv was named to Fortune® America’s Most Innovative
Companies for the second consecutive year.
- Clover® was named “Best Overall Commerce Platform” in the 2024
Annual FinTech Breakthrough Awards.
Outlook for 2024
Fiserv continues to expect organic revenue growth of 15% to 17%
and raises adjusted earnings per share outlook to $8.60 to $8.75,
representing growth of 14% to 16%, for 2024.
“Fiserv remains committed to our virtuous cycle of investment,
revenue growth, operating leverage, capital return and
re-investment for further growth, reinforced with a focus on
clients, operational excellence, and a strong balance sheet,” said
Bisignano. “This proven model, along with our strong first quarter
results, led us to raise our 2024 adjusted earnings per share
outlook for the full year.”
Segment Realignment
The company realigned its reportable segments during the first
quarter of 2024 to correspond with changes in its business designed
to further enhance operational performance in the delivery of its
integrated portfolio of products and solutions to its financial
institution clients (“Segment Realignment”). The company’s new
reportable segments are Merchant Solutions and Financial Solutions.
Segment results for the three months ended March 31, 2023 have been
recast to reflect the Segment Realignment. Additional information
regarding the Segment Realignment is available in the Current
Report on Form 8-K filed by the company on March 26, 2024.
Earnings Conference Call
The company will discuss its first quarter 2024 results in a
live webcast at 7 a.m. CT on Tuesday, April 23, 2024. The webcast,
along with supplemental financial information, can be accessed on
the investor relations section of the Fiserv website at
investors.fiserv.com. A replay will be available approximately one
hour after the conclusion of the live webcast.
About Fiserv
Fiserv, Inc. (NYSE: FI), a Fortune 500™ company, aspires to move
money and information in a way that moves the world. As a global
leader in payments and financial technology, the company helps
clients achieve best-in-class results through a commitment to
innovation and excellence in areas including account processing and
digital banking solutions; card issuer processing and network
services; payments; e-commerce; merchant acquiring and processing;
and the Clover® cloud-based point-of-sale and business management
platform. Fiserv is a member of the S&P 500® Index and has been
recognized as one of Fortune® World’s Most Admired Companies™ for 9
of the last 10 years. Visit fiserv.com and follow on social media
for more information and the latest company news.
Use of Non-GAAP Financial Measures
In this news release, the company supplements its reporting of
information determined in accordance with generally accepted
accounting principles (“GAAP”), such as revenue, operating income,
operating margin, net income attributable to Fiserv, diluted
earnings per share and net cash provided by operating activities,
with “adjusted revenue,” “adjusted revenue growth,” “organic
revenue,” “organic revenue growth,” “adjusted operating income,”
“adjusted operating margin,” “adjusted net income,” “adjusted
earnings per share,” “adjusted earnings per share growth,” and
“free cash flow.” Management believes that adjustments for certain
non-cash or other items and the exclusion of certain pass-through
revenue and expenses should enhance shareholders' ability to
evaluate the company’s performance, as such measures provide
additional insights into the factors and trends affecting its
business. Therefore, the company excludes these items from its GAAP
financial measures to calculate these unaudited non-GAAP measures.
The corresponding reconciliations of these unaudited non-GAAP
financial measures to the most comparable GAAP measures are
included in this news release, except for forward-looking measures
where a reconciliation to the corresponding GAAP measures is not
available due to the variability, complexity and limited visibility
of the non-cash and other items described below that are excluded
from the non-GAAP outlook measures. See pages 14-16 for additional
information regarding the company’s forward-looking non-GAAP
financial measures.
Examples of non-cash or other items may include, but are not
limited to, non-cash intangible asset amortization expense
associated with acquisitions; non-cash impairment charges;
severance costs; net charges associated with debt financing
activities; merger and integration costs; gains or losses from the
sale of businesses, certain assets or investments; and certain
discrete tax benefits and expenses. The company excludes these
items to more clearly focus on the factors management believes are
pertinent to the company’s operations, and management uses this
information to make operating decisions, including the allocation
of resources to the company’s various businesses.
The company adjusts its non-GAAP results to exclude amortization
of acquisition-related intangible assets as such amounts are
inconsistent in amount and frequency and are significantly impacted
by the timing and/or size of acquisitions. Management believes that
the adjustment of acquisition-related intangible asset amortization
supplements GAAP information with a measure that can be used to
assess the comparability of operating performance. Although the
company excludes amortization from acquisition-related intangible
assets from its non-GAAP expenses, management believes that it is
important for investors to understand that such intangible assets
were recorded as part of purchase accounting and contribute to
revenue generation.
Management believes organic revenue growth is useful because it
presents adjusted revenue growth excluding the impact of foreign
currency fluctuations, acquisitions, dispositions and the company’s
postage reimbursements. Management believes free cash flow is
useful to measure the funds generated in a given period that are
available for debt service requirements and strategic capital
decisions. Management believes this supplemental information
enhances shareholders’ ability to evaluate and understand the
company’s core business performance.
These unaudited non-GAAP measures may not be comparable to
similarly titled measures reported by other companies and should be
considered in addition to, and not as a substitute for, revenue,
operating income, operating margin, net income attributable to
Fiserv, diluted earnings per share and net cash provided by
operating activities or any other amount determined in accordance
with GAAP.
Forward-Looking Statements
This news release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995,
including statements regarding anticipated organic revenue growth,
adjusted earnings per share, adjusted earnings per share growth and
other statements regarding our future financial performance.
Statements can generally be identified as forward-looking because
they include words such as “believes,” “anticipates,” “expects,”
“could,” “should,” “confident,” “likely,” “plan,” or words of
similar meaning. Statements that describe the company’s future
plans, outlook, objectives or goals are also forward-looking
statements.
Forward-looking statements are subject to assumptions, risks and
uncertainties that may cause actual results to differ materially
from those contemplated by such forward-looking statements. The
factors that could cause the company’s actual results to differ
materially include, among others, the following: the company’s
ability to compete effectively against new and existing competitors
and to continue to introduce competitive new products and services
on a timely, cost-effective basis; changes in customer demand for
the company’s products and services; the ability of the company’s
technology to keep pace with a rapidly evolving marketplace; the
success of the company’s merchant alliances, some of which are not
controlled by the company; the impact of a security breach or
operational failure in the company’s business, including
disruptions caused by other participants in the global financial
system; losses due to chargebacks, refunds or returns as a result
of fraud or the failure of the company’s vendors and merchants to
satisfy their obligations; changes in local, regional, national and
international economic or political conditions, including those
resulting from heightened inflation, rising interest rates, a
recession, bank failures, or intensified international hostilities,
and the impact they may have on the company and its employees,
clients, vendors, supply chain, operations and sales; the effect of
proposed and enacted legislative and regulatory actions affecting
the company or the financial services industry as a whole; the
company’s ability to comply with government regulations and
applicable card association and network rules; the protection and
validity of intellectual property rights; the outcome of pending
and future litigation and governmental proceedings; the company’s
ability to successfully identify, complete and integrate
acquisitions, and to realize the anticipated benefits associated
with the same; the impact of the company’s strategic initiatives;
the company’s ability to attract and retain key personnel;
volatility and disruptions in financial markets that may impact the
company’s ability to access preferred sources of financing and the
terms on which the company is able to obtain financing or increase
its costs of borrowing; adverse impacts from currency exchange
rates or currency controls; changes in corporate tax and interest
rates; and other factors included in “Risk Factors” in the
company’s Annual Report on Form 10-K for the year ended December
31, 2023, and in other documents that the company files with the
Securities and Exchange Commission, which are available at
http://www.sec.gov. You should consider these factors carefully in
evaluating forward-looking statements and are cautioned not to
place undue reliance on such statements. The company assumes no
obligation to update any forward-looking statements, which speak
only as of the date of this news release.
Fiserv, Inc.
Condensed Consolidated
Statements of Income
(In millions, except per share
amounts, unaudited)
Three Months Ended March 31,
2024
2023
Revenue
Processing and services
$
4,000
$
3,673
Product
883
874
Total revenue
4,883
4,547
Expenses
Cost of processing and services
1,354
1,405
Cost of product
651
600
Selling, general and administrative
1,697
1,604
Net loss on sale of businesses and other
assets
—
4
Total expenses
3,702
3,613
Operating income
1,181
934
Interest expense, net
(261
)
(202
)
Other expense, net
(7
)
(20
)
Income before income taxes and loss
from investments in unconsolidated affiliates
913
712
Income tax provision
(153
)
(124
)
Loss from investments in unconsolidated
affiliates
(8
)
(12
)
Net income
752
576
Less: net income attributable to
noncontrolling interests
17
13
Net income attributable to
Fiserv
$
735
$
563
GAAP earnings per share attributable to
Fiserv — diluted
$
1.24
$
0.89
Diluted shares used in computing
earnings per share attributable to Fiserv
594.8
631.3
Earnings per share is calculated using
actual, unrounded amounts.
Fiserv, Inc.
Reconciliation of GAAP
to
Adjusted Net Income and
Adjusted Earnings Per Share
(In millions, except per share
amounts, unaudited)
Three Months Ended March 31,
2024
2023
GAAP net income attributable to
Fiserv
$
735
$
563
Adjustments:
Merger and integration costs 1
37
48
Severance costs
42
24
Amortization of acquisition-related
intangible assets 2
369
427
Non wholly-owned entity activities 3
28
38
Net loss on sale of businesses and other
assets
—
4
Tax impact of adjustments 4
(95
)
(108
)
Adjusted net income
$
1,116
$
996
GAAP earnings per share attributable to
Fiserv - diluted
$
1.24
$
0.89
Adjustments - net of income taxes:
Merger and integration costs 1
0.05
0.06
Severance costs
0.06
0.03
Amortization of acquisition-related
intangible assets 2
0.50
0.54
Non wholly-owned entity activities 3
0.04
0.05
Adjusted earnings per share
$
1.88
$
1.58
GAAP earnings per share attributable to
Fiserv growth
39
%
Adjusted earnings per share growth
19
%
See pages 3-4 for disclosures related to the use of non-GAAP
financial measures. Earnings per share is calculated using actual,
unrounded amounts.
1
Represents acquisition and related
integration costs incurred in connection with acquisitions. Merger
and integration costs associated with integration activities
primarily include $14 million of third-party professional service
fees in both the first quarter of 2024 and 2023, as well as $9
million and $20 million of share-based compensation and associated
taxes for the first quarter of 2024 and 2023, respectively.
2
Represents amortization of intangible
assets acquired through acquisition, including customer
relationships, software/technology and trade names. This adjustment
does not exclude the amortization of other intangible assets such
as contract costs (sales commissions and deferred conversion
costs), capitalized and purchased software, financing costs and
debt discounts. See additional information on page 13 for an
analysis of the company's amortization expense.
3
Represents the company’s share of
amortization of acquisition-related intangible assets at its
unconsolidated affiliates, as well as the minority interest share
of amortization of acquisition-related intangible assets at its
subsidiaries in which the company holds a controlling financial
interest.
4
The tax impact of adjustments is
calculated using a tax rate of 20% in both the first quarters of
2024 and 2023, which approximates the company's anticipated annual
effective tax rates.
Fiserv, Inc.
Financial Results by
Segment
(In millions, unaudited)
Three Months Ended March 31,
2024
2023
Total Company
Revenue
$
4,883
$
4,547
Adjustments:
Postage reimbursements
(340
)
(322
)
Deferred revenue purchase accounting
adjustments
—
6
Adjusted revenue
$
4,543
$
4,231
Operating income
$
1,181
$
934
Adjustments:
Merger and integration costs 1
37
48
Severance costs
42
24
Amortization of acquisition-related
intangible assets
369
427
Net loss on sale of businesses and other
assets
—
4
Adjusted operating income
$
1,629
$
1,437
Operating margin
24.2
%
20.5
%
Adjusted operating margin
35.8
%
34.0
%
Merchant Solutions (“Merchant”)
2
Revenue
$
2,253
$
1,996
Operating income
$
769
$
592
Operating margin
34.1
%
29.7
%
Financial Solutions
(“Financial”)
Revenue
$
2,285
$
2,223
Adjustments:
Deferred revenue purchase accounting
adjustments
—
6
Adjusted revenue
$
2,285
$
2,229
Operating income
$
1,008
$
943
Adjustments:
Deferred revenue purchase accounting
adjustments
—
6
Adjusted operating income
$
1,008
$
949
Operating margin
44.1
%
42.4
%
Adjusted operating margin
44.1
%
42.5
%
Fiserv, Inc.
Financial Results by Segment
(cont.)
(In millions, unaudited)
Three Months Ended March 31,
2024
2023
Corporate and Other
Revenue
$
345
$
328
Adjustments:
Postage reimbursements
(340
)
(322
)
Adjusted revenue
$
5
$
6
Operating loss
$
(596
)
$
(601
)
Adjustments:
Merger and integration costs
37
42
Severance costs
42
24
Amortization of acquisition-related
intangible assets
369
427
Net loss on sale of businesses and other
assets
—
4
Adjusted operating loss
$
(148
)
$
(104
)
See pages 3-4 for disclosures related to the use of non-GAAP
financial measures. Operating margin percentages are calculated
using actual, unrounded amounts. 1
Includes deferred revenue purchase
accounting adjustments within the Financial segment related to the
2019 acquisition of First Data Corporation. Adjustments for this
residual activity concluded as of December 31, 2023.
2
For all periods presented in the Merchant
segment, there were no adjustments to GAAP measures presented and
thus the adjusted measures are equal to the GAAP measures
presented.
Fiserv, Inc.
Condensed Consolidated
Statements of Cash Flows
(In millions, unaudited)
Three Months Ended March 31,
2024
2023
Cash flows from operating
activities
Net income
$
752
$
576
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and other amortization
401
352
Amortization of acquisition-related
intangible assets
373
433
Amortization of financing costs and debt
discounts
11
10
Share-based compensation
86
93
Deferred income taxes
(24
)
(87
)
Net loss on sale of businesses and other
assets
—
4
Loss from investments in unconsolidated
affiliates
8
12
Distributions from unconsolidated
affiliates
8
11
Non-cash impairment charges
14
—
Other operating activities
10
(1
)
Changes in assets and liabilities, net of
effects from acquisitions and dispositions:
Trade accounts receivable
3
255
Prepaid expenses and other assets
(315
)
(224
)
Contract costs
(57
)
(66
)
Accounts payable and other liabilities
(457
)
(336
)
Contract liabilities
18
98
Net cash provided by operating
activities
831
1,130
Cash flows from investing
activities
Capital expenditures, including
capitalized software and other intangibles
(420
)
(339
)
Distributions from unconsolidated
affiliates
22
34
Purchases of investments
(3
)
(5
)
Proceeds from sale of investments
3
—
Other investing activities
1
(4
)
Net cash used in investing
activities
(397
)
(314
)
Cash flows from financing
activities
Debt proceeds
2,743
2,071
Debt repayments
(987
)
(424
)
Net repayments of commercial paper and
short-term borrowings
(484
)
(781
)
Payments of debt financing costs
(11
)
(15
)
Proceeds from issuance of treasury
stock
39
29
Purchases of treasury stock, including
employee shares withheld for tax obligations
(1,674
)
(1,530
)
Settlement activity, net
219
(460
)
Distributions paid to noncontrolling
interests and redeemable noncontrolling interest
(34
)
(8
)
Other financing activities
—
(31
)
Net cash used in financing
activities
(189
)
(1,149
)
Effect of exchange rate changes on cash
and cash equivalents
(17
)
17
Net change in cash and cash
equivalents
228
(316
)
Cash and cash equivalents, beginning
balance
2,963
3,192
Cash and cash equivalents, ending
balance
$
3,191
$
2,876
Fiserv, Inc.
Condensed Consolidated Balance
Sheets
(In millions, unaudited)
March 31,
December 31,
2024
2023
Assets
Cash and cash equivalents
$
1,214
$
1,204
Trade accounts receivable – net
3,574
3,582
Prepaid expenses and other current
assets
2,595
2,344
Settlement assets
29,711
27,681
Total current assets
37,094
34,811
Property and equipment – net
2,226
2,161
Customer relationships – net
6,747
7,075
Other intangible assets – net
4,179
4,135
Goodwill
37,038
37,205
Contract costs – net
941
968
Investments in unconsolidated
affiliates
2,220
2,262
Other long-term assets
2,253
2,273
Total assets
$
92,698
$
90,890
Liabilities and Equity
Accounts payable and accrued expenses
$
3,957
$
4,355
Short-term and current maturities of
long-term debt
671
755
Contract liabilities
779
761
Settlement obligations
29,711
27,681
Total current liabilities
35,118
33,552
Long-term debt
23,754
22,363
Deferred income taxes
3,048
3,078
Long-term contract liabilities
247
250
Other long-term liabilities
948
978
Total liabilities
63,115
60,221
Redeemable noncontrolling interest
160
161
Fiserv shareholders' equity
28,801
29,857
Noncontrolling interests
622
651
Total equity
29,423
30,508
Total liabilities and equity
$
92,698
$
90,890
Fiserv, Inc.
Selected Non-GAAP Financial
Measures and Additional Information
(In millions, unaudited)
Organic Revenue Growth 1
Three Months Ended March 31,
2024
2023
Growth
Total Company
Adjusted revenue
$
4,543
$
4,231
Currency impact 2
504
—
Acquisition adjustments
(3
)
—
Divestiture adjustments
(5
)
(15
)
Organic revenue
$
5,039
$
4,216
20%
Merchant
Adjusted revenue
$
2,253
$
1,996
Currency impact 2
468
—
Acquisition adjustments
(3
)
—
Divestiture adjustments
—
—
Organic revenue
$
2,718
$
1,996
36%
Financial
Adjusted revenue
$
2,285
$
2,229
Currency impact 2
36
—
Divestiture adjustments
—
(9
)
Organic revenue
$
2,321
$
2,220
5%
Corporate and Other
Adjusted revenue
$
5
$
6
Divestiture adjustments
(5
)
(6
)
Organic revenue
$
—
$
—
See pages 3-4 for disclosures related to the use of non-GAAP
financial measures. Organic revenue growth is calculated using
actual, unrounded amounts. 1
Organic revenue growth is measured as the
change in adjusted revenue (see pages 8-9) for the current period
excluding the impact of foreign currency fluctuations and revenue
attributable to acquisitions and dispositions, divided by adjusted
revenue from the prior period excluding revenue attributable to
dispositions.
2
Currency impact is measured as the
increase or decrease in adjusted revenue for the current period by
applying prior period foreign currency exchange rates to present a
constant currency comparison to prior periods.
Fiserv, Inc.
Selected Non-GAAP Financial
Measures and Additional Information (cont.)
(In millions, unaudited)
Free Cash Flow
Three Months Ended March 31,
2024
2023
Net cash provided by operating
activities
$
831
$
1,130
Capital expenditures
(420
)
(339
)
Adjustments:
Distributions paid to noncontrolling
interests and redeemable noncontrolling interest
(34
)
(8
)
Distributions from unconsolidated
affiliates included in cash flows from investing activities
22
34
Severance, merger and integration
payments
68
55
Tax payments on adjustments
(13
)
(11
)
Free cash flow
$
454
$
861
Total Amortization 1
Three Months Ended March 31,
2024
2023
Acquisition-related intangible assets
$
373
$
433
Capitalized software and other
intangibles
144
108
Purchased software
59
54
Financing costs and debt discounts
11
10
Sales commissions
28
28
Deferred conversion costs
24
20
Total amortization
$
639
$
653
See pages 3-4 for disclosures related to
the use of non-GAAP financial measures.
1
The company adjusts its non-GAAP results
to exclude amortization of acquisition-related intangible assets as
such amounts are inconsistent in amount and frequency and are
significantly impacted by the timing and/or size of acquisitions.
Management believes that the adjustment of acquisition-related
intangible asset amortization supplements the GAAP information with
a measure that can be used to assess the comparability of operating
performance. Although the company excludes amortization from
acquisition-related intangible assets from its non-GAAP expenses,
management believes that it is important for investors to
understand that such intangible assets were recorded as part of
purchase accounting and contribute to revenue generation.
Amortization of intangible assets that relate to past acquisitions
will recur in future periods until such intangible assets have been
fully amortized. Any future acquisitions may result in the
amortization of additional intangible assets.
Fiserv, Inc. Full Year
Forward-Looking Non-GAAP Financial Measures
Reconciliations of unaudited non-GAAP financial measures to the
most comparable GAAP measures are included in this news release,
except for forward-looking measures where a reconciliation to the
corresponding GAAP measures is not available due to the
variability, complexity and limited visibility of these items that
are excluded from the non-GAAP outlook measures. The company’s
forward-looking non-GAAP financial measures for 2024, including
organic revenue growth, adjusted earnings per share and adjusted
earnings per share growth, are designed to enhance shareholders’
ability to evaluate the company’s performance by excluding certain
items to focus on factors and trends affecting its business.
Organic Revenue Growth - The company's organic revenue growth
outlook for 2024 excludes the impact of foreign currency
fluctuations, acquisitions, dispositions and the impact of the
company's postage reimbursements. The currency impact is measured
as the increase or decrease in the expected adjusted revenue for
the period by applying prior period foreign currency exchange rates
to present a constant currency comparison to prior periods.
Growth
2024 Revenue
6.5% - 8.5%
Postage reimbursements
(0.5)%
2024 Adjusted revenue
6% - 8%
Currency impact
8.5%
Acquisition adjustments
0.0%
Divestiture adjustments
0.5%
2024 Organic revenue
15% - 17%
Adjusted Earnings Per Share - The company's adjusted earnings
per share outlook for 2024 excludes certain non-cash or other items
such as non-cash intangible asset amortization expense associated
with acquisitions; non-cash impairment charges; non-cash pension
plan termination charges; merger and integration costs; severance
costs; gains or losses from the sale of businesses, certain assets
and investments; and certain discrete tax benefits and expenses.
The company estimates that amortization expense in 2024 with
respect to acquired intangible assets will decrease approximately
10% compared to the amount incurred in 2023.
Other adjustments to the company’s financial measures that were
incurred in 2023 and for the three months ended March 31, 2024 are
presented in this news release; however, they are not necessarily
indicative of adjustments that may be incurred in the remainder of
2024 or beyond. Estimates of these impacts and adjustments on a
forward-looking basis are not available due to the variability,
complexity and limited visibility of these items.
Fiserv, Inc.
Full Year Forward-Looking
Non-GAAP Financial Measures (cont.)
The company's adjusted earnings
per share growth outlook for 2024 is based on 2023 adjusted
earnings per share performance.
2023 GAAP net income attributable to
Fiserv
$
3,068
Adjustments:
Merger and integration costs 1
158
Severance costs
74
Amortization of acquisition-related
intangible assets 2
1,623
Non wholly-owned entity activities 3
133
Net gain on sale of businesses and other
assets 4
(167
)
Canadian tax law change 5
27
Tax impact of adjustments 6
(355
)
Argentine Peso devaluation 7
71
2023 adjusted net income
$
4,632
Weighted average common shares outstanding
- diluted
615.9
2023 GAAP earnings per share attributable
to Fiserv - diluted
$
4.98
Adjustments - net of income taxes:
Merger and integration costs 1
0.21
Severance costs
0.10
Amortization of acquisition-related
intangible assets 2
2.11
Non wholly-owned entity activities 3
0.17
Net gain on sale of businesses and other
assets 4
(0.19
)
Canadian tax law change 5
0.04
Argentine Peso devaluation 7
0.12
2023 adjusted earnings per share
$
7.52
2024 adjusted earnings per share
outlook
$8.60 - $8.75
2024 adjusted earnings per share growth
outlook
14% - 16%
In millions, except per share amounts,
unaudited. Earnings per share is calculated using actual, unrounded
amounts.
See pages 3-4 for disclosures related to
the use of non-GAAP financial measures.
Fiserv, Inc.
Full Year Forward-Looking
Non-GAAP Financial Measures (cont.)
1
Represents acquisition and related
integration costs incurred in connection with acquisitions. Merger
and integration costs associated with integration activities
primarily include $35 million of share-based compensation and $70
million of third-party professional service fees.
2
Represents amortization of intangible
assets acquired through acquisition, including customer
relationships, software/technology and trade names. This adjustment
does not exclude the amortization of other intangible assets such
as contract costs (sales commissions and deferred conversion
costs), capitalized and purchased software, financing costs and
debt discounts.
3
Represents the company’s share of
amortization of acquisition-related intangible assets at its
unconsolidated affiliates, as well as the minority interest share
of amortization of acquisition-related intangible assets at its
subsidiaries in which the company holds a controlling financial
interest.
4
Represents a net gain primarily associated
with the sale of the company’s financial reconciliation
business.
5
Represents the impact of a multi-year
retroactive Canadian tax law change, enacted in June 2023, related
to the Goods and Services Tax / Harmonized Sales Tax (GST/HST)
treatment of payment card services.
6
The tax impact of adjustments is
calculated using a tax rate of 20%, which approximates the
company's annual effective tax rate, exclusive of actual tax
impacts of $48 million associated with the net gain on sale of
businesses.
7
On December 12, 2023, the Argentina
government announced economic reforms, including a significant
devaluation of the Argentine Peso. This adjustment represents the
corresponding one-day foreign currency exchange loss from the
remeasurement of the company’s Argentina subsidiary’s monetary
assets and liabilities in Argentina’s highly inflationary
economy.
FISV-E
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240423396315/en/
Media Relations: Ann S. Cave External Communications
Fiserv, Inc. 678-325-9435 ann.cave@fiserv.com
Investor Relations: Julie Chariell Investor Relations
Fiserv, Inc. 212-515-0278 julie.chariell@fiserv.com
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