Fiserv Earnings Beat Estimates in Q4, Revenues Fall Marginally Y/Y

Fiserv, Inc. FI has reported mixed fourth-quarter 2024 results, wherein earnings beat the Zacks Consensus Estimate, while revenues missed the mark.

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FI’s adjusted earnings per share of $2.51 beat the consensus mark by 1.2% and gained 14.6% year over year. Adjusted revenues of $4.9 billion missed the consensus estimate by 1.1% and declined marginally on a year-over-year basis.

The FI stock has gained 36.2% over the past six months, outperforming the 21.9% rally of the industry it belongs to and the 17.3% rise of the Zacks S&P 500 composite.

Fiserv, Inc. Price, Consensus and EPS Surprise

Fiserv's Quarterly Details

Processing and services’ revenues of $4.3 billion increased 5.8% on a year-over-year basis and beat our estimate of $4.2 billion. Revenues in the Product segment were $991 million, rising 11.1% from the year-ago quarter’s actual and outpacing our estimate of $961.4 million.

Revenues from Merchant Acceptance were $2.5 billion, rising 10.5% year over year and beating our estimate of $2.2 billion. The Financial Solutions segment reported revenues of $2.4 billion, marking a 3% increase from the year-ago quarter and missing our projection of $2.7 billion.

The operating margin for the Merchant acceptance segment was 39.2%, up 150 basis points (bps) on a year-over-year basis. The adjusted operating margin for the Financial Solutions segment was 51.7%, increasing 330 bps from the year-ago quarter.

Balance Sheet & Cash Flow of FI

Fiserv exited the fourth quarter of 2024 with cash and cash equivalents of $1.2 billion, unchanged from the third quarter of 2024. The long-term debt was $23.7 billion in the fourth quarter of 2024 compared with $24.1 billion in the preceding quarter.

FI generated $2.2 million in net cash from operating activities, whereas its free cash flow was $1.9 billion. Capital expenditure was $399 million. The company repurchased 6.1 million shares for $1.3 billion in the quarter.

Fiserv's 2024 Guidance

The company has raised its 2024 guidance for adjusted earnings per share to $10.1-$10.3 from the previous quarter’s view of $8.73-$8.80. The guided range is higher than the Zacks Consensus Estimate for earnings of $8.77. Fiserv updated its year-over-year earnings growth guidance to 15-17% from the 16-17% provided in the preceding quarter. FI lowered its year-over-year organic revenue growth guidance from the 16-17% mentioned at the end of the previous quarter to 10-12%.

Fiserv carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Earnings Snapshots

Automatic Data Processing, Inc. ADP reported impressive second-quarter fiscal 2025 results.

ADP’s earnings per share of $2.4 beat the consensus estimate by 3.5% and increased 10.3% from the year-ago quarter. Total revenues of $5.1 billion surpassed the consensus estimate by 1.6% and grew 8.1% on a year-over-year basis.

FactSet Research Systems, Inc. FDS posted impressive first-quarter fiscal 2025 results.

FDS’s earnings per share (excluding 48 cents from non-recurring items) of $4.4 beat the consensus mark by 1.6% and increased 6.1% from the year-ago quarter. Revenues of $568.7 million surpassed the Zacks Consensus Estimate by a slight margin and gained 4.9% from the year-ago quarter.

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