In This Article:
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Adjusted Revenue Growth: 4%, ahead of expectations.
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Recurring Revenue Growth: Accelerated to 4% from 2% last quarter.
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Adjusted EBITDA: $958 million, with a margin of 37.8%.
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Adjusted EPS: $1.21, up 11% year-over-year.
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Free Cash Flow: $368 million, with a conversion rate of 71%.
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Capital Expenditures: $233 million, or 9% of revenue.
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Shareholder Returns: $670 million, including $450 million in share repurchases.
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Banking Revenue Growth: 2%, with recurring revenue growth at 3%.
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Capital Markets Revenue Growth: 9%, with recurring revenue growth of 6%.
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Adjusted EBITDA Margin for Capital Markets: Expanded by 90 basis points.
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Full Year Outlook: Reaffirmed with total shareholder return of 11% to 13%.
Release Date: May 06, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Fidelity National Information Services Inc (NYSE:FIS) reported a strong start to 2025 with adjusted revenue growth of 4%, exceeding expectations.
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Recurring revenue growth accelerated from 2% last quarter to 4%, indicating strong demand for FIS's core solutions.
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The company achieved an adjusted EBITDA at the high end of its outlook, with a free cash flow conversion exceeding 70%.
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FIS announced strategic transactions, including the sale of its Worldpay stake and acquisition of the Issuer Solutions business, expected to strengthen its financial profile and value proposition.
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The company returned $670 million to shareholders through share repurchases and dividends, demonstrating strong capital management.
Negative Points
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Professional services revenue declined by 5% due to the completion of large projects, impacting overall revenue growth.
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Banking EBITDA margin contracted to 40.1%, reflecting high license and termination fees from the previous year.
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The company faces a tough year-on-year comparison on EMI, impacting EPS growth.
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Capital expenditures were 9% of revenue, which may indicate high ongoing investment requirements.
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There is a potential risk of integration challenges with the acquisition of the Issuer Solutions business, which could impact expected synergies.
Q & A Highlights
Q: Can you provide an update on client conversions and the pipeline for the Issuer Solutions business? A: Stephanie Ferris, CEO, confirmed that all client conversions went live as expected, positively impacting banking revenue. The pipeline is increasing significantly, with no slowdown in client spending. The feedback on the Issuer Solutions business has been very positive, with clients appreciating the focus on financial institutions.