Earnings call transcript Q1 2023

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to Global Payments First Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] And as a reminder, this conference is being recorded. At this time, I would like to turn the call over to your host, Senior Vice President, Investor Relations, Winnie Smith. Winnie. ahead, go Please

Winnie Smith

welcome Payments and conference quarter call. to morning first Global XXXX Good

and accompany our slides be earnings the Our release that the Relations www.globalpayments.com. found Investor this area at of website on can call

impact to we results factors, and comments by economic forward-looking financial that statements the of statements results. I’d some call other including among expectations. subject today’s made to you cause These management remind could Before our that to risks, begin, on matters, other of materially future about, conference the from during differ uncertainties, and contain like conditions expected are operating operations actual

Certain including you place undue risk forth SEC, our set most are reliance on recent not to these subsequent in factors caution our statements. XX-K business We the in filings with and inherent filings.

during statements and call them. undertake Forward-looking of as call only of this the to this date no update obligation we speaks

also more which several be non-GAAP We our to measures, of performance. reflective financial referring will are believe we ongoing

a with X-K For most our in to as Form the measure exhibit discussed morning measures this on see GAAP comparable to of financial accordance this an non-GAAP call website. supplemental section regulations, press in materials our release the please our our Investor furnished reconciliation and available the filed SEC full of Relations

Josh Joining the Executive Senior Whipple, Vice and Bready, Cameron President COO; on me CFO. and call are CEO; Jeff President and Sloan,

Jeff. Now, to I’ll turn call the over

Jeff Sloan

Winnie. Thanks,

best delivered to to pleased are in uncertainties. our XXXX, have quarter macro start Exceeding four continuing We expectations first years. despite our

This on share cycle consistent operating earnings net strategies wisdom produced expansion, businesses adjusted growth guidance performance and execution. with focus of the per adjusted our our ongoing consistent Our reflects and our margin once again. growth, adjusted revenue

while on results turning these strategic our accomplished page initiatives. the We also

as EVO late underway, integration start. a Payments nine the remain more at we delighted many and of will are we that preface already our announced by to opportunities we Cameron our efforts me ago. comments to his excited but have have transaction about together March now strong months off we saying in are provide we we let were time as acquisition First, closed the details the

delighted Eva's welcome members Payments officially am value to the family. Global I to team

completed Consumer our to business. of pleased have Assets divestitures the and Netspend's Gaming also are recently Solutions We

to execution XX%. transactions, With years these ideal net the are XX% to of our solutions set, including successful many approximately come. composition on forward This from of with us focused provides business revenue, managing for we platform the solutions which comprising core grow, and representing roughly adjusted BXB, our issuer go merchant capabilities

is results It for operating [Our generated years. issuer important our and core highlighting performance sequential core [ph] merchant] digit single of financial more than financial improvement, growth and marking again our high issuer and with base systemically globally. its posted customer Starting quarterly consists best exceptional achieving center substantial five that in the quarter. business institutions first solutions, worth money

come. during Year-over-year, expect to double-digits. we've volumes the larger we tailwinds that or the consumer combined of flows into depository transaction quarter, with incremental believe We which some for provide several implementations significant to beneficiary been the institutions, grew time

also business recovery transactions in with cross-border corporate travel domestic as Our commercial continued part first continued the to growing quarter nearly trajectory. XX% and perform its

execution new with customers. roughly the by a on XXX growth to existing and new Traditional to year due and record accounts of file increased from conversion sequentially, double-digits prior accounts million strong

head. versus that aligning the strategy at winners legacy this bear with on Our fintech it's point of XXXX continues And decades and long has now to turned from thoroughly hypothesis think I been share fruit. debunked clear market its

of competitive takeaway, the our significant win March. merger. we States a banks top the was in portion one of This that a commercial delighted early announcement are United XX We double in of successfully converted early the after

leading the We deployed analytics also partner our April. for the conversion data States. cloud-based we a the AWS, collaboration institution and portfolio platform successfully Postbank of in completed financial And with in in United

we as as We FI the of U.S.-based worldwide through with currently longstanding Bank, to have process. nine well Finally, RFP signed partner nearly of during have which M&T another with multi-year are competitive extensions letters a all were intent achieved institutions quarter. pleased

Turning solution corporates virtual and to institutions with capabilities. drive leverage strong both automation financial we our BXB, we employer MineralTree growth continue to card, and as

digitized further quarter, supplier as This market record we middle achieved enrollments their companies payments.

in that period we growth normalized of MineralTree near for for XX% continue delivered and calendar business roughly It's noting the worth XXXX. growth this expect XX%

of resiliency and of double-digit the excluding was the delivered by the macro driven achieved banking uncertainties latter crisis performance This growth, which in contribution developed We incremental from are of our quarter. part EVO. merchant dispositions the that business, proud one-week the despite

the high teens. period e-commerce for worldwide our growth include the Stand-out businesses, omni-channel where accelerate again and into

are the UK, we UCP, now by Europe. making great partnership North spans America, of Continental Speaking and our with that Citi progress in Spring

and pipeline many on-track customers, XX the million $X We volume of than rating countries than together more largest at over and treasury with run our across our XXX are on Citi's in end we to volume and based double currently more transactions XXXX. are And by billion of annually. live solutions trade

U.S., trends a strong of rates integrated We at rate our in continue sustained grew business mid-teens the also which to with growth. accelerated see in

strong for quarter in channel, new for demand a this record ongoing demonstrating produced solutions. also our We sales

by growth on estate restaurants Xenial vertical Additionally, stadiums. service led markets and real and School quick achieved Zego, Solutions, and double-digit

provide at Truist parks we we our day partnership have agreement gone our our beverage all States. to Park. quarter, the as entertainment X, are both solutions as have solutions pleased its food leading Xenial last announcing with United excited After locations and solutions, retail live to to with our well park Brave are the opening point-of-sale company April And cloud with for the and on Xenial an reached theme of across

as best States, lifted were the end business at Asia pipeline Outside its Our full China. including restaurant businesses. across COVID-related Greater in and XXXX Pacific of service restrictions United remains our the our produced entertainment Stay since quarter XXXX, fixed and tuned. sports first

Central We with continue growth to to and strong Spain these EVO are other in as scale Europe and we such in our excited see markets. trends faster enhance geographies

had launches point-of-sale including opportunities also phone solution] product several in UK. our EVO. We all [tap-on bode with in quarter in Europe, [ph] our These solution for Europe, cross-sell the during successful in Central the well the

in of I Payments personally the of turn as I've has the Before address senior the Cameron, Bready, for X next time. as and CEO. departure positions Cameron company and during that and over effective known like held he to most of CEO to I'd Cameron announcement appointment years Global our nine my our June trusted

our and today President our and CFO as as First, COO.

success an is me. will our ensure every coming confidence right weeks. I the in leader outstanding Cameron over and person I and continued succeed future his company's can to a everything do transition and the smooth to to have Cameron

right We with to in succession first in of months. our plans. execute transactions first our produced XX closed strategic Now our our for is us four best all on on the recently three years beat-and-raise quarter time and we

course in Our are to businesses same the exceptionally a and excluding guidance on XXXX, delivered in do heightened of dispositions. XXXX healthy. poised are We cycle

e-commerce, When and a scale While and I we to Global remain, hope legacy strengths, but call. Payments we to as repay. years BXB path much our arrived we on challenges a February we lack debt we technology return direct for and at have have XX suggested distribution, ago, strategy undoubtedly work, on are to many normalcy

sizable years roughly assets. multi-year growth unique exposure XX a and footprint We faster have owned a and we to AWS software technology omni-channel and BXB I with Now, enhanced after and markets market-leading Google. CEO, distinctive assets distinctive became e-com with couple both and distribution collaborations partnered, presence, solid

all Finally XXX has basis the at and running the S&P last points goals. been three years. XX.X% index XXX the turmoil the Simply of peers, over annually, our points last the we've importantly, since in in X.X excess accomplished over GPN nearly put, XXX and company, stock excess our basis compounded we've years of despite

now turn call to Cameron. I'll the

Cameron Bready

Thanks Jeff, and good morning.

an I'm in continuing company to a in what CEO the start Global Board's the to me it Payments. outstanding me forward be privilege history capacity, for Global working has for the confidence of been honor leadership is acknowledging look of what me forward going all long I you Let leading grateful Payments. with at named and and next this of by

Payments, to has the remarkable past over of behalf shaped the members note, here it my want also company business appreciation XX,XXX under has decade. at his into for sincere CEO Further, friendship Payments. and today. my on the the team express Global to more been under of I The during the technology powerhouse his stewardship thank On and as a transformation want mentorship Jeff I leadership time Global for payments his personal is

conference have this importantly as endeavor over I and nine the worldwide. technology-enabled articulated side worked roughly Jeff software-driven ago. we on the our remain and at strategy completely We strategy the build XX my at business to to leading committed by payments years investor months company aligned side we four-pillared been

geared and of the over time EVO taking corporate last our consumer Having the our more businesses, to we've at foreshadowing now towards acquisition when closed delighted Gaming customers have completed the pivot. model, year. reflects our divestitures strategic Netspend August business we and of of Solutions be our simpler since been I'm now a

team to company's and I Over investing ensure while I fostering live none the rich culture a drive transition. in corporate the and we around closely orderly the look the will and forward customers, continuing next which growth value and of Jeff for and is globe. smooth communities to members, our our differentiated second a work strategically work in to citizenship shareholders, that enhancing month, and to history

I EVO Global that, members would With team remarks Jeff’s to Payments. echo like to welcoming

opportunities have us about the X, and on the ground have truly available. announcing prepare are the we for August, remain to running. early in the integration synergy plans progress we day still in an allowing we formulate our ample substantial integration hit time and made Since transaction days, enthusiastic to While

and our actions implement a achieve align report million do rate established targets. to a at time within two EBITDA as least we the smooth leadership years We executable the pleased to of announcement. at $XXX acquisitions, target plans us currently committed synergy enabled have I'm to governance all and that with to structure that run has have which in we transition our early that resulted with robust of we the of

market corporate expense strategies, and eliminating synergy technology to operations aligning streamlining operational infrastructure, efficiencies. substantial opportunities and realizing duplicative scale The business from support and go expected structures, primarily come our are

the expectations an expand eye ways, ensuring it we we expense focused remain sizing and continue all with in that well-positioned grow the As in that to maintain future. on synergy to and momentum combined business towards is

highlight company, three uniquely software we distinctive of would base positioned with combined to and And I payment by one us enhancements, we regarding acquisition. synergies to the reiterating unmatched customer ample broad drive to will start suite More run that solutions from an revenue our that potential are provide categories rate specifically, as globally. believe deliver I revenue

leveraging to enablement This First, market technologies, significant bring further partner platforms software by as solutions, we portfolio, integration our offerings. see commerce product value EVO's vertical opportunity distribution in extensive our well capabilities. as to our unique point-of-sale and relationships includes

are we with we example, key one Europe. international and where Spain, including UK, Central markets point-of-sale As EVO, software bringing overlap the our to

base We including cross-sell point-of-sale Poland, software Greece. not to as bring markets today, do Mexico, customer geographies, overlap in these as EVO plan to capabilities these where our we well Ireland, into and EVO's

capitalize e-commerce blending their multinational markets requirements. virtual to geographies, physical to and customers, omni-channel provide seamlessly Second, solutions on and we EVO's our expect across ability and

in globally, XX transact and With value significantly XXX presence proposition customers. the virtually, over its ability we existing our combined countries to to physical EVO's can over expand in

already around We to MNC largest additional EVO's clients the world. opportunities explore in discussion markets of initiated with support them some have to

payment offerings. our includes the which marketplace grow augments in Third, of EVO's to integrations EVA's proprietary to further through some accounts automation extensive payable leveraging its grounding particularly ERP in the Fabric BXB of most on automation capabilities, Together environments platform. out our scale BXB portfolio, with used we accounts acceptance suite the widely Pay are and existing and BXB solutions EVO, our other receivable software well-positioned full side,

EVO with as We the could about technology opportunities our our scale together position unmatched company excited many preeminent Josh? reach. the with not its global and reinforcing we overarching alignment given payments strategy, with further extensive be more have

Josh Whipple

Thanks, Cameron.

performance financial despite in which We business. strength durability our of exceeded the macro and our highlighting concerns, expectations with strong are quarter, our first the ongoing pleased

from adjusted constant X.X% Specifically, $X.XX period the an basis. revenue year same the net on in we prior of delivered of a increase billion, currency

disposition, increased of and contribution from impact X% revenue of EVO, Excluding a the roughly net on currency constant one-week basis. adjusted

the a $X.XX, solutions the net adjusted a share was of to constant the operating XX.X%. of eased strength at $X.XX of recovery the achieved adjusted revenue in our EVO. XX% currency quarter and first the net from closer Adjusted margin billion led by Pacific basis increased performance China points the period for excluding XXX quarter growth constant look Asia restrictions contribution we ongoing of to by segment, result basis, per while merchant technology-enabled same on XXXX. increase dispositions businesses, currency an for XX%, Greater earnings with of markets. was The Taking benefited in across This performance as COVID compared from

last We UK. also from of XX.X% margin including adverse strength by was year. delivered growth rates. macro POS, the payroll Along market, in adjusted saw the consistent offset and foreign limited exchange geographies, vertical This segment, currency with softness double-digit our operating from with ongoing an in partially headwinds We consistent businesses.

basis March, our was close EVO’s of points XX impact the expectations. and expanded adjusted operating with margin in-line Excluding in

are first reflecting which point produced Notably, revenue of which of quarter, performance basis. sequentially. acceleration solutions net the fundamental of with a in was basis grew of constant X.X% quarter, issuer We XXX currency million, $XXX the FX, our impact issuer pleased high-single-digits adjusted the over excluding this core on business growth

customers, card As of approximately also conversions to both strong by increased double-digits, XXXX portfolio successfully file coming period. driven Jeff $XX sequentially Transactions as during grew highlighted, consumer with account our completed major the growth and portfolio million accounts the contributions quarter several on first from we well strong by compared from transactions. commercial as traditional consumer

the margins prior by fueled XX points operating accelerated adjusted our growth. year of delivered basis XX.X%, we from increase an Finally, of

for cash free with adjusted XX% the of converted free flow, adjusted we approximately earnings As cash consistent period, adjusted into prior flow.

We credits. adjusted of target the roughly the XXX% earnings full-year, the change impact related tax continue of development converting to of for to the research timing recognition excluding and

million flow capital spending XXXX. follow capital the the our as to expenditures year We be in similar $XXX expect around targets. continue trajectory We adjusted our in to $XXX free conversion expect cash quarter for XXXX, with consistent and during million a invested to long-term

roughly was million This of our quarter, closing $XXX million, EVO shares March payments executed X.X on approximately repurchased for the of we of our prior to acquisition which XX.

capital. EVO million] at this priced [ph] rate capital our the to offering we [€XX credit base January, a billion structure March, European global The in fund by new early $X our paper transaction, help evolve we and gain X.XXX% successfully XXXX. established with fixed access and align transaction, operations a With program. commercial to an inaugural to coupon in agreement. a continue is broader CP during To investor of of sources Separately, supported program our debt revolving we

At had paper available $X in currently commercial billion have $X of of the billion quarter, of of excess We the approximately end we liquidity. outstanding.

debt total transactions Following approximately and weighted close drawing on revolver is with fixed XX% indebtedness markets the the our cost EVO, a average of capital to X.X%. aforementioned of

the divestiture April. in Gaming closed the We business are sale Netspend's also to assets both have of of consumer the Solutions and delighted

is healthy remains sheet balance our transactions, and roughly these our currently. of all X.Xx Following leverage position

where continue investment leverage to while ended a to expect return grade year-end XXXX level we maintaining existing ratings. to XXXX, by We similar to

with is positioned and we how performance pleased outlook are the financial raising year. first our are our our We following business for quarter

We range reported to of billion, increase from to billion adjusted now X% expect revenue to over X% reflecting net XXXX, previously. from X% growth $X.XXX an $X.XXX X%

XXX to XXXX. basis adjusted forecast up We points continue margin by expand annual operating to to for

margin by of and of this shift to expansion points EVO technology XX lower margin a synergy of cycle Netspend, mix our driven XX by benefits is towards As business above full partially from our the the profile annually, to guidance prior basis points reminder, divestiture our realization. to enablement offset for basis ongoing

higher level, to now merchant at anticipate color the range. XX% segment [ph] that to the roughly report our growth net to segment but adjusted [To we the revenue XX% continue of be expect to of provide] for full-year, end toward

XXXX, excluding We which basis dispositions adjusted continue business, margin of to expect in Payments ahead existing our guide. than the points merchant XXX of Global is cycle more again from operating expansion

more impact second mitigated year this profile anticipate quarter of expansion EVO margin as in this beginning be of be We to offset progresses. the will lower synergy expect realization than by absorption the the Payments. We with the

we As in in our expansion The second net then operating our and forecasting are margin and with QX be merchant will for decline consistent year, a business. contraction merchant margin in the prior the for as synergies total result, quarters a ramped third result business adjusted reported modest margin guidance. our

X% first performance the deliver outlook reflects in range, net to benefit from to Moving adjusted the to We our in to XXXX. now to expected up the from our X% X.X% full-year, Solutions. quarter conversion anticipate we pipeline. for growth X.X% better Issuer This than expect the previously compared and revenue

Specifically, and our We continue anticipate XX to by business. adjusted issuer and to expect natural to BXB margin double-digits. for as the operating expect business outlook with now grow basis operating the prior expand leverage the core benefit we businesses we low grow issuer from to MineralTree consistent points above in Netspend X% to up

In note. there terms phasing, continuing items of quarterly to two are

First, while we the points basis headwind roughly net quarter. be the we rates up expect anticipate full-year, to a neutral second currency foreign XXX for still to in revenue exchange to of adjusted

prior the impact sale earnings second million expectation per we add end revenue Second, of change of for roughly share with no incremental the for year. the successful $XX our April of closing the to Netspend quarter for expect dilution to of versus the expected our

to non-operating couple of Moving a items.

guidance. increase for be from We with a be million rate movements. tax roughly XX% to of effective guide of $XXX modest And our our in-light adjusted XX.X% in our expect range expense to the prior net million, prior $XX curve consistent interest yield

excess with share assume leverage targeted repurchases levels XXXX to indebtedness we for return is in cash of the until then. the pay continue until down minimal our end we year purposes, modeling to to For used

now we for be in XX% XX%, $XX.XX, to adjusted together, of to to range previously. to of over reflecting up XX% XXXX, the per earnings expect all it the from share growth $XX.XX Putting full-year XX%

Excluding in dispositions, XXXX the macro adjusted XX% to updated to guide, XX% is changes with environment earnings adverse despite be cycle per share XXXX. for growth consistent since is our This expected then. incremental

Our share quarter internal adjusted first per our results $X.XX forecast. to roughly be relative earnings represent

beat essentially across year couple saw current for businesses others, to somewhat strength guidance the our of March. from markets February, of number for moderated uncertainties the and in of heard in-light XXXX plus environment. which Similar a you've the raised in of rolls the cents in what our calendar Our we a January

Our experience through center bank large as to issuer March business developed banking regional crisis in benefited did not moderation business money resilient that April similar and the of discernible continue remain to any levels from our in March. this Trends customers activity.

presumes macroeconomic is that environment outlook updated worldwide backdrop Our the the XXXX. today with a calendar remainder throughout current year consistent

that, turn with to And the call I'll over back Jeff.

Jeff Sloan

is management He Thanks nearly our century. closely of near in [ph] we've the the and affect proud than has my together a Global couldn't transition forward team with with history long more I'm him look very to with Josh. also team third to smooth members [management’s quarter Cameron weeks. XX,XXX and of the a of achieved over debt] I Payments more working succession be XX countries. coming a planning. only CEO across over as last what pleased decade complete I confidence plus

as you've trust millions XX us Global and members thousands at every in Winnie? years. of bright day, the do is of and personally well what put last the our and they Payments. as future customers in us me I shareholders partners our for thank for and all The over team

Winnie Smith

Thanks, Jeff.

Operator, everyone questions like go questions. accommodate one one Thank limit session, everyone question-and-answer their to Before to we our begin the to I'd we will with in queue. now you. to to follow-up ask

Operator

first from Instructions] Shirvaikar [Operator Our from today you. Thank is Ashwin Citi. coming question

now live. Your line is

Ashwin Shirvaikar

congratulations Thank Cameron happy pleasure. you Jeff, It's the quarter. congratulations on the on for And promotion. and you. good a been

and you you new of me provide let through detailed U.S., Let macro factors, now sort for Asia and sort me you. of could, merchant that other and would geographical should we a with well, footprint, unpack think that how of if normalized us, Pac Europe, couple consider growth as start includes recovery if including great? you the as for be could geographies the Americas rate EVO of the more walk kind of,

Cameron Bready

I ask and chime don't to provide Why ahead Jeff color Cameron. with It's like I'll as go in other start, Ashwin. any well. he'd Hey, to

look and obviously think performance business, So, I you I good we how the for first if about feel merchant think quarter for at the in backdrop pretty the overall full-year. our we're positioned the

increase by to so our continue in full-year. As at home the obviously up expectation and the of U.S., for the see merchant the to across high-end trends, Starting evidenced a the here reiteration good growth and of for business. an to speak business we guide kind

others like already, very and who us. think were have January February I months reported strong

and now. of kind we We bit obviously in right April, see March similar saw a little pullback a of to March looking

year, So, portfolio. the for component assuming well-positioned based the we relatively obviously balance are where consistent on really the year biggest U.S. our course of nicely a it's our of today think I the the to macro grow of business over is and

So, rest as goes. generally business merchant of it goes the the

course integrated think good with saying the U.S. us EVO So, automation across into BXB the we where largest are time. capabilities the with mid-market portfolio center conversation portfolio acceptance has that bring addition AR that powerful Solutions assets a enterprises of solutions the by for about have I the they And in we and] to in that EVO today, the U.S. think U.S. that really type feel [We we very in the into over of [ph] lot obviously we a the can there's ERP is do really we

So, that. more on to come

I Obviously, of geographies good there. a think a various story. overall mix Europe is

in EVO add very secular Greece, EVO. markets that and us, now long-term to the Europe Obviously, again We we're good of Poland that important with addition markets in will with fundamentals to continue strong of of both to Spain. very strong which see growth trends Central the two attracted and for through are acquisition

of off the trend high year Continuing really the of sky a as last take soft, remains effectively for the GDP consistent their UK market. Brexit coming as back implications inflation well first that as the pretty quarter. in was hold, Obviously half flat

Europe little as So, we're us, the but the pretty prospects headwind look we about for bit remains a of there. long-term overall, at UK a excited I obviously think

And remarks, got our quarter teens mid-to-high prepared then Asia Jeff as We're starting XXXX. in that activity, that's in Pacific Pacific, since best as we we to we the growth across lastly operate. more intra-Asia in his finally re-openings really stool all highlighted for see saw to we first of Asia cross-border, get had Asia sort Asia back in cross-border obviously which We the normality business see good fully yet is in meaningful, but inter-Asia as and which of to our full next market. leg of the markets reopens

merchant we as the step of quarter think one quarter. Obviously a from in. business, before accelerated at and factoring point growth line sequentially week the addition matter I fourth back the top EVO we versus for a roughly So, look the of

the the think and of So that feel achieve guidance to poised, very we the I this of off guidance very quarter of morning. – coming kind good the balance about remain for the updated year the trends provided

Ashwin Shirvaikar

very Thank with, subscription much. rev couple driving then That's or of there, like first that you business time do to that? very for years. than growth Is I volume think, you more adjusted Is like, something of useful. expect value-add greater that revenue sustain? the in or model a that merchant, services? What's was sticking with the And probably different sort growth,

Cameron Bready

else. anything than more Ashwin mix, really it's Yes,

related points contributes the it few the predominantly rounded more difference. businesses, That's up, then to kind which you're bit metrics. a little market difference one of had down. line top a strong But driven between vertical does which to basis two, tens quarter, a talking the rounded are one of software the Our obviously volume

XX. weight revenue So, may top put versus better, other, better. on to sometimes to a be a be little bit the of it It's may be bit I growth going little fluctuate much too the sometimes XX will wouldn't sometimes each volume

XX very back and is in look at XX we relatively is marketplace. the I two to fundamentally and minimal, think tight gap that each versus is, to others other what correlation moving those are step in

well. So, fundamentally the with I obviously how we're are that happy growth at and of think business, as underlying the trending the demonstrates looking revenue things volume very

Ashwin Shirvaikar

Understood. Congratulations again. Thank you.

Cameron Bready

Thanks, Ashwin.

Operator

Peller Your is from Research. next Wolfe from coming question Darrin

now Your live. line is

Darrin Peller

Hey, guys. Thanks.

First what's possible a to now Cameron, you GPN you're come of of all, more on both of as congrats the going transition. maybe to the process you can Just sense more Jeff thought give the of at a for little why you if you us as know if well it's excited – to give look Jeff, you, on most what color when and about a your timing forward? and where little curious change. in you and

Jeff Sloan

for Darren, saying it's Jeff. Thanks that.

about but just and worked we probably start posted start, Let of too me we judgment, an quarter since normalcy. Probably first and said by that hoping years look, I in were his XXXX. it's environment Cameron the and for where just the saying talked February we We press in nine in release our would I say, look, prepared years I have that best close late. together remarks nine as in

XX Solutions, got we're ago, the months today. right. focused really months up. you, our kind there really I but it's Netspend, closing think closing in on We've XX we're that said EVO, And not closing last importantly, Gaming we've Darrin, months. started like beat-and-raise first for surprising sale ramped And XX XX then probably publicly on real XX like those months months the of to that

putting really stable we've about with return period operating we would very talked and got at have just say, businesses So, me, for stability, period for normalcy, strategic sure thank XXXX transactions I I this to levels. kind behind a of important Board And these us, I but probably also make our time, Cameron until with I'd just up we the sticking mean, agreed since normalcy it's to then real me important. first all these that do I had, think is want I are done. any for environment this the I of macroeconomic and good that things

part] the right a So, just [ph], if be really and in [indiscernible]. me. sitting you’re [South on that is I'll quite I Darrin, timing visit beach ever come think

Darrin Peller

and my just about I value-added Well, more congrats lot, and the pricing services I well thinking talked tight, on a would just changes. quick – be Pfizer showing you in Cameron, a industry, seen as pretty guess it across pricing mix we Jeff. talked these being see we've industry, just and follow-up about little Thanks, now the you now again. but between know

seen on price the years, some having there quite comment on we of so front. that could of And after bit would cost for or Any be a inflation a think thoughts? couple any opportunity

Cameron Bready

Darren. Yes,

hasn't reflect has around and think I to which many and bringing price philosophy try been capability ways years we're of consistent the level the pricing services for in we that our is do pretty our to differentiated really competitors. the market, many value from We changed that we to think perspective our now. have

Think marketplace. obviously points the along we to and to optimize bring at, can make a to and how constantly pricing acceptance several to capabilities the again sure services of that we that for and try with pure we’re very we offer sort looking price hard have of packaging payment value-added different our were past the solutions years variety we're the

with lack say, side, think is of the on being, perspective recently. our pricing a aggressive more term people their perhaps strategies I I'd overall better more look, are for more So,

to to that the think long relates over particularly of period and our it as bodes try a we landscape time. I well competitive business how position

a from coming as matter. pricing So, nothing us unusual

backdrop into the pricing and the easier looking to to service that. of try bring portfolio it's we stick. reflect would and the I is doing make people a other optimization probably would in but strategies more the that that those point bit obviously again it little say, makes to I customer, with It to value same, at for the

Darrin Peller

Great. Congrats Thanks. job quarter guys. the again. Nice on

Jeff Sloan

Darrin. Thanks,

Cameron Bready

Darrin. Thanks,

Operator

Thank you.

Your Morgan Faucette from from next James question Stanley. coming is

line Your live. now is

James Faucette

and very including Wanted my everything closed, much the and Cameron. you how accomplished – Thank key add few does it brings? to or Cameron you, there you're still timing very that EVO thinking now especially and in Payments to other Great. at both, looking about and maybe doing are you with strategically want acquisitions, question incorporating still acquisitions prioritization given next Jeff to keep a things steps, about your to Darrin's follow-up congratulations and change position capital good is and on recent integration time to

Cameron Bready

Yes, James. question. Great

So, [ph] much say been last the locked nine pretty and Jeff foremost, I first the [head] at have and for would I years.

And ago a you XXX% the shouldn't in conference. and the you behind focus strategy of articulated should business kind for it's strategy going to closely build deviation continued matter the radical think many a we right and Jeff quite expect strategy XX worked I on investor months us a much I very together that contrary, So, four-pillar over I'm years, strategy. absolutely our forward. expect as that strategy. at

to my priority execute continue will forward. So, move be highest that against to we strategy as

time. end same period I well think ratio getting remarks, his the by leverage priority in perspective matter, sure that as very EVO from on make targeted a we're prepared to effectively focused highlighted the a and perspective, of over of year, of that capital Josh this as as we priority allocation back that capital our is integrate allocation

things well thing. here saying to a we've the like the to to on have that try We do next take we before already committed we

is the that's focus to relates level, to EVO it, effectively, nine So, I good balance to business. that start. our next, getting continue capital be the to months, sure a as unchanged. as leverage investing call allocation will We're I going relatively to between making clearly integrating back off right think targeted strike And remain then to to try the obviously go-forward our think on priorities a grow going it the to matter,

of in do ways invest And ways we're a period expand our in that investment to shareholders, to well our the value Our drives various find priority is strategy of in opportunities for meaningful business to a and that through and grow as returns augment we'll that pillars and business. the as that footprint finding inorganic pursuing activities, as the to the return over way we support absent have long to time. organic look capital to

So, to I change going dramatically. capital the think allocation don't or overall philosophy approach to is

period the of think same, be shareholders more a I of the for good be to and over very more of will same going it's think long time. I our

James Faucette

least How [ph] has commentary was in-spite increase. year And there? little you planning through you change revisiting as been the or We've And March more it [really a that And macro of just thinking seen been came versus there year, seemed a really outlook in much qualitative Got at are your spending, slowdown of the slowdown little when or] some it. now economic cautious little late Got through bit bit it. months of recession. into then April. guidance no mentioned, conditions assumption consumer a a like the you had the in is and the about ago? the Thanks. three

Josh Whipple

Yes.

go that. So, ahead take and I'll

guide. in that And the So, two first relative approximately internal I revenue my from perspective as in to and said is, QX, is environment. $X.XX assumes consistent EPS primary the the the forecast. as a was macro would which changes with we I to there's the about is outlook change current was saw better about million thought outperformance remarks, What backdrop, $X.XX prepared XX the we say our the guide, really, really or

it's we Netspend from And of month specifically out our specifically by or really in we through that to very has expect February guide went – April. relative nothing then secondly, quarters. Other on the $XX laid and that the that to changed call we than million the received that,

Jeff Sloan

math looking add that to in to volumes Josh We're current went color April. some at just transactions the James, and through.

other point, you've that and folks. already this So Mastercard the Visa some I from and his heard what in to of think Josh your said prepared remarks, reflects, and

than our internally, the better incorporates Josh raise able that the beat think despite described. been I Yet that, we've a little environment. So, outlook current bit to as

business, and into too, banks [Indiscernible] issuer mentioned regional some First announcement tailwinds our from prepared the the in just issuer with JPM consolidation So, I my we discernable ago, that the we're any money a the moderation. the say And particularly particular, remarks, today would of beneficiaries minute center coming seen of as comfortable Republic, in SIFIs. business, hasn't in very from are. we're I with where

today we events. [ph] acceleration our much in and very pointed [current] outlook, reflects that Obviously, to

here some trends more ago, before [indiscernible] sitting that's mentioned are our a consolidation. through of minute recent I April As strong, today from the of a right? And very point KPI

So, globally good may is macroeconomic but business. the not for FIs the broader environment, news certainly, issuer be toward it for larger nothing great trend our but

James Faucette

detail. all That’s the for great. Thanks

Jeff Sloan

Thanks, James.

Operator

you. Thank

question next from coming is Jason of Kupferberg America. Your Bank from

is live. Your now line

Jason Kupferberg

to Good cadence modeling about quarter. to ask we tweaks morning. for And out by Congrats the a year. there's three quarterly you of there pretty so see and wanted that of get outlook right. to everybody. kind the just the I margin revenue last any quarters if quarterly laid detailed just wanted little And know quarter last

in of had pieces, organic, of think you merchant, but each some about I range X% pretty example, helpful? kind we talked go XX% quarter, quarterly those if be would to that through in Thank you. For being consistent just that can

Josh Whipple

specific say, we nothing Look, rates what very would per QX, earnings revenue QX I quarterly really gave Yes, you and absolutely. changed. on I has share. February, growth through is, say And would

X% did back the QX So, the adjusted out if earnings obviously net which performance to overall you X% did to outlook four, X% there, – we said we saw outlined. just presentation to go to we and put that based QX, that And in in the X% reported raise QX. revenue on we I X% we to X% raise

points margin which QX again, from to of we perspective, in said XX% through through from we February. good we which then EPS in saw we we outlined would XXX a laid in expect we're do. February QX points, right perspective, X% an on QX we really then margin expansion, margin the out expansion a basis basis range QX, XXX look, QX, call. what for that And And exactly from And

relative So on call. again, QX to through changed it nothing discussed QX has February we what the as relates to

Jason Kupferberg

Good to hear.

the right as non-discretionary Is portfolio, acquiring that have what seeing the merchant, merchant? the discretionary, software in side, still talk you at putting about follow-up. on and closing? relative if spending half you think a I side, And Okay. between terms non-discretionary talked post growth the breakdown can in half And of in about roughly you're In more past, just rates spending. the the guys EVO least discretionary just the volumes on

Cameron Bready

great different it's there. aggregated post-EVO. all the geographies pretty the I'll overall think at would in I Obviously, Yes, of is Jason, roughly volume I mix well of jump stage in single say globe holds the other split Cameron, what this around terms kind that we've EVO don't not slightly have every merchant if across exposure needle move to footprint existing going given that the even deal globally, the the to, vertical their split relative a our size one they way to of different. it's is but or

to to of of slowed experiences January. kind relative food goods In I'll degree. February, in overall, saw retail from food kind slowed but of you the spending sales down say, sort U.S. say, down would January some and trend we relative quarter, to would U.S., the was towards and sort spending which to in and really broadly. kind And March, I strong the skewed and I first of around retail is continue more February the more example, retail less, use see very perspective, a as services of and

heavy and cetera, So, et traditional, in, of non-discretionary I well. little and But kind the lighter to a little in a particularly care, et that retail, think, portfolios, in beverage, are categories overall, as cetera. health together trends we better pretty the services, came trends it relates food the

different trends nearly Visa we've different broadly, any the which But our have to about the are think heard markets. don't relates as and business we're it in we I more from and you across I MasterCard March April talked already. obviously, seeing vertical like, diversification what than XX activity,

like split weightings I discretionary, have that sort the we of and non-discretionary across categories.

we're the the it as So, obviously, the of balance I macro evolve year. through for think to well-positioned, environment continues

Jason Kupferberg

the Okay. Appreciate thoughts.

Cameron Bready

Jason. Thanks,

Operator

you. Thank

is from El-Assal today Barclays. from coming Ramsey question Next

line Your now is live.

Ramsey El-Assal

congratulations of needs as start will When my in? be Is taking the if provide you I Thanks Hi, question. to long to those for and my of add you. a with ask that well unlock order that there. do little take? might both so in commentary flowing synergies done revenue on timing EVO. to I wanted bit how to much any work more could there the those

Cameron Bready

those support, obviously, cetera. some distributing don't today those of revenue EVO. with more it's capabilities Naturally, than but Ramsey, my integrate work bit and operate types pursuing Yes, of tried market, all a that that of we of that in little as that could bringing that wish some different great involve stand our on sure our them, through anything there's to overnight the to to a switch else bring in or of give platforms imagine, level to comments significant into to have can opening the environments question. pipes under investment. make their to distribution that of et to start a I markets and up, amount they those capabilities we I we're operates flip product synergies we're EVO products have distribution a you color

multinational EVO takes markets different in new platforms time as customers well. on up [Indiscernible]

the side. the synergy much That's over work there's is that lot longer goes EVO that to term, business of So, of talk into as the a a driving, kind medium-term. about synergies That's much revenue why near really we emphasis the relates more of in see of period actionable potential to expense in we the time. around it short

we to expect earlier meaningful in EVO of of accretion from the obviously, We three. a deal have one, million that amount, clear today. drives that years and line the the synergies XXX sight we highlighted obviously, two And expense that

of kind outer on EVO's of a north top I XXX million. get think synergies tailwinds, point We of kind create can as run into years. the revenue we of rate certainly two think nice we revenue add existing or

XX you're the of synergy million to my able revenue XX running remarks. revenue about million talking So, we're synergies the earlier to EVO respect I and talked to that levels once prepared business at from up probably least various of activities get in with

good see that drive in incremental we So, business. to revenue potential

to And by we'll those deliver already good period target that we're point light opportunities. a doing is all confident not their of up obviously, a if we're top two over growth on think business. a time increasing what for able more, they're on revenue that very I of or once that,

Ramsey El-Assal

it. Got

are follow-up how us one how value-added for either part trending? retention? services to value-added things you attach update curious is or how business Could And become and new sales evolving? services just rates Okay. important on And your give that me. I'm have like an like of

Cameron Bready

about year over it's half strategy, as say, conference would talked I our a of little an a Yes. incredibly important our back and at investor we ago. part

bring. at look we clearly I merchants it, portfolio of breadth the that depth to as think of by virtue there's our attracting element capabilities an new of I and

I to retention to services of is our a capability we're able in able offer. and terms of virtue element being to more by value-added think customers deliver and differentiation product there the

to thirdly, bring that in And partners integrated the to at seen I we've side, the think portfolio based bringing bear on their what rates on be we base. great new and in consider can success I would largely capability attractive partners retaining relatively referral on customer

that payment much offer the providers customers. we to more a pure than of able experience are lot So, offer integrated their

we the breadth partners, can think business the big that and to over it's continue a quarters. in we of have a working I that been value-added last strength see with service the we terms integrated reason of many bring our is in differentiator

the delivering customers. it's we're So, our part proposition that important to of value increasingly an

it's capabilities more important I part as markets even the look think have profile of the longer-term And again, differentiation the of important at job of an done outside It's we've distinction utilizing a a period. over U.S. market. to very we growth in drive and we the And good

in well. others can Spain, businesses relative Bringing of today markets U.K., have differentiation to in what Europe tailwind et some been they've offer of significant to as levels the capabilities that for cetera, a the the drives we markets like U.S. those Central and even greater to those

it's it something the on continue So, going forward and part time. conference, move in investor it's we build an strategy. time about why as to we're of at talking so to It's much we our important long-term, spent

Ramsey El-Assal

Thank so you much.

Cameron Bready

Thank you.

Operator

Thank you.

from Keane Deutsche Bank. from next Your coming question is Bryan

Your line now is live.

Bryan Keane

congratulations, morning Good both guys. you Hi, and course, to guys. of of

out and organic I about in the the merchant just points, call thinking they quarter. and they up quarter more even XX expansion Anything EVO in were opportunities the year, thinking before the particular about basis flat in Just integrate we margins, merchant in margin segment? think, in last came to

Cameron Bready

say, in a I'll we ex-EVO at any lower core Josh EVO Bryan, macro look got if profile would color he margin than start margin let I Cameron. Yes, because add. in and a just has level, at I'll in QX business. profile our additional to to it's at maybe comes jump

So, in That's ended up QX. consistent with QX, we where XX expanded margins ex-EVO we around basis by in points. pretty

impacts mix than got you probably else, As movement. that anything that mix imagine, we've more can

vertical come a we're for of margins QX, margin perform the north continue market lower ways And in during kind top expansion ex-EVO seeing XX%. you, overall margin the profile, our and business a of in merchant matter, exactly delivered to to relative we mix But for tends pandemic, of those of which on business. at, that sort they verticals some to I'll of the those the what would well from plans. at I to are margin As businesses remind experienced recover in say, the expansion

at So, revenue company gaining as see be already in functions obviously percentage to overall, at we the will margin think longer pace. continue the and that more time, across we're for our over of not business, about at of expansion driven scale XX%, as a same corporate business expansion XX% grow period the those margins margin of as a look through of when better expenses in that obviously, we

medium-term. issuer that has the business more the runway, secondly, near obviously, I in then a And margin around to think, little over expansion

in the for margins. expect So, still for merchant articulated what his around the as We merchant Josh prepared was expectation expected quarter. same full-year, exactly the we remarks

margin EVO As at it a comes bring in, profile. we in lower

time, kind to continue from back we'll get there. levels of build pre-EVO As course, to then, of we expand over look to and synergies

Josh Whipple

and that as we'll will to in QX. would some guide the we margins consistent at margin decline net merchant the contraction, then February and EVO, it just is profile, QX, only Yes. thing which of result again, And a add in bringing lower see full-year, we'll the outlined the by see relates coming then in in be some The as I a with is modest mentioned, to QX start is, for on margin that expansion this which call. Cameron

Bryan Keane

guys thinking it Issuer trends, that's segment raised I revenue you Got towards X issuer. LOIs. obviously, the in you're trends in the was the favor just assets banks, your the then just as growth about think year, know movement I helpful. towards really pointing the for And larger a but and it. No, follow-up, towards

about just thinking XXXX even issuer some guys the as positive these about maybe outlook of bit a of So, trends? are even more beyond feeling you longer-term, a result little

Jeff Sloan

And I it's of are the row be about part think I quarter of Bryan, couldn't in it in another of I of Jeff. the rate growth provides mean XX now Issuer this or is I probably points acceleration has and we more for fourth sequential think something quarter basis growth incremental months the I added relative where to a leg Issuer. significant something, last business. in business. that that been Core like of nine positive or said growth. of BXB

not providers. nine going number providers, in So in or that would the institutions first to with yes, time looking financial new on say either select of things I RFP are other terms large their

there. well-positioned very we're think I

sells, right? that the first cloud we February in sure weren't of the number call the in when on said started receptivity. I So, years ago we As this,

meeting into table a of think walk strong you with a it's kind very I And Now, we're and in position. AWS, stakes.

of a in, I've these So, today's are. JPM, year think are as very that's for yes, maybe been difficult macro announcement we and economy, even for I broader good And of about news, about half the excited the right? talking things where as rolling that kind and

those in I so have over time. toward the we next reverse a money the center think of confidence heading periods. tailwind more think So, the I the to nice into got you've more next see and of I think aren't the immediately, going tailwinds period number we very And SIFI, themselves

Bryan Keane

Okay, great. again. Congrats

Jeff Sloan

Bryan. Thanks,

Cameron Bready

Bryan. Thanks,

Operator

Thank you.

is coming Our today Vasu from final question from KBW. Govil

is line live. now Your

Vasu Govil

as for to that much congratulations to first Jeff. Thank I both, and add My is well. question you you you, want very

it for I think you year. XX% mentioned MineralTree and grew you're quarter expecting XX% the to in grow the

on of your an some drive going sort to into wanted give the just business on I So, acceleration. cross-sell if broadly piece you base? could that merchant the seeing And efforts update for also us are of color that you more what,

Jeff Sloan

Vasu. it's Yeah, great question, a

the couldn't treatment. we we have neural you where in are BXB. that way, about So, be more know I by And excited really

from end March. now Of course, has into the rolled of EVO

So, tailwind obviously, kind that's an doing. to, we're of incremental what

The look, X, I business answer person is our been we've deep I is, that now, a long right at time. the question around building busy July there to was some So over that pipeline been summer, think started running very and he's last think military selling quite your it for so pipeline.

from one the now. benefit of seeing card, and TSYS a also the our business, largest well We're planet card at growing where on of benefit that's that very the cross-sell XX%. core is seeing rates into of substantial virtual providers virtual north We're pf

So, it's cloud virtual question, from I on cross-sell visible think, the the It's sale the Vasu, answer obviously mathematics of very deeper in. core rolls the software just and the the cards business, recurring high. your is pipeline very to selling more is, the SaaS rate attach into on it

we the So, of it's what mathematics really just built.

the February expect where be I it. I its XX% notables, on obviously a are think I increase, call, XX% of Cameron will confidence is describing about of terms pleased think I we evidence look, in honest, we XX% two about And and talked think, U.S. to [said I over Citizens. and increasing the growth wins. we with the and, be trajectory more or talked the more. balance year notable team rate couldn't we of and Those But is to Bank, of Josh be that from our In think [ph], business those]

Vasu Govil

probably just a are But is follow-up recession sort of stable the months And here. three know backdrop. of I that on I assuming great. from was than stays my just then macro it think ago. That's you today risk macro higher guys the

do can very a So, you you sensitivity issuer as that also we slowdown both you Thank to merchant extent the have? much. see in just and cost might talk the and the revenue levers about

Jeff Sloan

ask Vasu, start, Yes, I'll Josh and to then comment. I'll

kind So, we've what let of start assumed. just saying, me by

are environment the to X, May taking say X, today. is going today So, where we're April, we we've so I May assumed current was meeting I but guess, today,

So, to actually to said And answer looking April] going with level, your question, February think are on the just current our initially, what we we're we're I we back not where trends macro XX the today. call, to we discernible were majority it issuer business, [ph] in as we're obviously KPIs relates doing. see [of prepared through said as what we we the in any vast our have there, the on don't the remarks, moderation

we're ago kind today we our X February, get and reflects taking a So, were don't rather comment where of obviously, you, where too? want raised they today, are the on bit, way in outlook things things [indiscernible] we the months don't merchant they current assume environment. assume X, to and better, Cameron, for you Josh,

Cameron Bready

Yes, Vasu, it's Cameron.

we point before. that. to we of to I mentioned has And of saw saw in February. same think March. bit I relative January, this earlier, March strong been April the Jeff's Obviously, little slowed in down more to kind a trends what relative

that's we So, we of the as of year. the expectation towards balance kind look have the

forth to that our expectations outlook perfection we've As of achieve I said, the don't kind of the to relative many obviously need times year in the for the past, set today. current we balance

the overall anticipate, we obviously fall the that of about deviations, then some If we'll we're And withstand, the year. relatively on overall I can feel we macro If positioned the balance off that good we've environment I that seeing I'd opportunity. it. think that obviously, So, anticipating deliver say, would things in more for shared. we're to things how precipitously, obviously, slight obviously revisit than guide improve say, creates we're upside

today to business forward we guide, obviously, how think, I the we're that. continue So, balance to The that. for of feel good is against I the positioned And about, think reflects looking execute year. the

Vasu Govil

Great. you very much. Thank

Cameron Bready

Thanks, Vasu.

Jeff Sloan

us you Global in joining this and thank interest your of On Payments, us behalf for morning. for

Operator

today's and conclude does That webcast. teleconference you. Thank

and participation today. time, wonderful you your this at for line We a your disconnect may You thank have day.

Global Payments (GPN) 1 May 232023 Q1 Earnings call transcript