Yahoo Finanza Fiserv Inc (FI) Reports Strong Q1 2024 Earnings, Surpasses Analyst Revenue Forecasts
GAAP Revenue: Reached $4.88 billion in Q1 2024, marking a 7% increase year-over-year, surpassing the estimated $4.57 billion.
Adjusted EPS: Grew by 19% to $1.88, exceeding the estimated $1.79 per share.
Organic Revenue Growth: Reported at 20% for Q1 2024, driven by significant growth in the Merchant Solutions segment.
Operating Margin: GAAP operating margin improved to 24.2% from 20.5% in the previous year, reflecting enhanced operational efficiency.
Free Cash Flow: Amounted to $454 million, a decrease from $861 million in the prior year period.
Stock Repurchase: Repurchased 10.2 million shares for $1.5 billion, demonstrating strong capital return to shareholders.
2024 Outlook: Adjusted EPS forecast raised to $8.60 to $8.75, indicating expected growth of 14% to 16%.
On April 23, 2024, Fiserv Inc (NYSE:FI), a global leader in payments and financial services technology solutions, disclosed its first-quarter earnings for 2024, showcasing significant growth and financial performance that exceeded analyst expectations. The details of the earnings were released in their recent 8-K filing.
Company Overview
Fiserv is renowned for its comprehensive suite of services including electronic funds transfer, payment processing, and loan processing primarily for US banks and credit unions. With the integration of First Data in 2019, the company expanded its merchant services, enhancing its offerings in the payment processing landscape. Notably, Fiserv generates about 10% of its revenue from international markets, emphasizing its global footprint.
Financial Performance Highlights
The company reported a GAAP revenue increase of 7% to $4.88 billion for Q1 2024, surpassing the estimated revenue of $4574.64 million. Organic revenue growth was particularly strong at 20%, driven by a remarkable 36% growth in the Merchant Solutions segment. The Financial Solutions segment also saw a healthy increase of 5%. Adjusted earnings per share (EPS) rose by 19% to $1.88, outperforming the estimated EPS of $1.79.
GAAP earnings per share were $1.24, marking a 39% increase from the previous year. The company's adjusted operating margin expanded by 180 basis points to 35.8%, reflecting improved operational efficiency and productivity. Fiserv's commitment to innovation and client service was underscored by several accolades, including being named to Fortune Americas Most Innovative Companies for the second consecutive year and the Clover platform winning the Best Overall Commerce Platform at the 2024 Annual FinTech Breakthrough Awards.
Strategic Developments and Outlook
Fiserv's strategic realignment of its business segments has enhanced its operational performance, as evidenced by the strong first-quarter results. The company continues to anticipate organic revenue growth of 15% to 17% for 2024 and has raised its adjusted EPS outlook to $8.60 to $8.75, indicating expected growth of 14% to 16%.
CEO Frank Bisignano commented on the quarter's successes, stating,
Fiserv extended its strong revenue growth and margin expansion into 2024 leading to 19% adjusted earnings per share growth in the first quarter. 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."
Financial Health and Shareholder Returns
The company's robust financial health was further highlighted by significant shareholder returns, with 10.2 million shares repurchased for $1.5 billion in Q1 2024. Additionally, Fiserv successfully completed a public offering of $2.0 billion of senior notes, which will support continued strategic investments and shareholder returns.
In conclusion, Fiserv Inc's first-quarter results for 2024 not only exceeded analyst expectations but also positioned the company for sustained growth. With strategic initiatives well underway and a raised outlook for the year, Fiserv remains a formidable entity in the financial technology sector, poised for further success.
Explore the complete 8-K earnings release (here) from Fiserv Inc for further details.
This article first appeared on GuruFocus.
