FISV - Earnings call transcript Q3 2019

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Welcome to the Fiserv 2019 Third Quarter Earnings Conference Call. All participants will be in a listen-only mode until the question-and-answer session begins, following the presentation.

As a reminder, today's call is being recorded.

At this time, I would now like to turn the call over to Peter Poillon, Senior Vice President of Investor Relations at Fiserv. Thank you

Peter Poillon

afternoon, good and Michelle, everyone. Thanks, Financial is With Chief and our Chief and Yabuki, Frank me Bob Bisignano, our Officer; today Executive; Operating our Chairman Chief Jeff President Officer. Hau, and

presentation Our earnings the Relations of section the are available Investor for fiserv.com. release on quarter supplemental and

remarks include First from synergies about, our acquisitions of forward-looking Our among operating expected and matters, today expected results, financial benefits will Data. and strategic statements other initiatives and recent

a results statements risk number may to differ are Forward-looking of actual uncertainties. and from and subject materially

You these to our discussion should earnings refer release risk a for of factors.

today’s Please internal stated for along refer to constant otherwise, revenue throughout this performance to to the year-over-year our materials measures a currency measures basis. this those explanation for financial the references and call, made discussed nearest of in all are references call non-GAAP growth call applicable Unless of measures. comparisons on reconciliation the are with an GAAP

the supplemental the have GAAP and by non-GAAP historical Data, information. our which certain include been in that financial and Data First results of First financial year-to-date to adjustments materials included note making Also measures for release full sum prepared earnings Fiserv and quarter

combined on Form to please information, which we X-K filed historical refer additional October For financial X. the

important for Finally, York March this XX seeing be City. to please in We mark to event. calendar Day our for you New your Investor held on look forward

turn call the over I'll now, Jeff. And to

Jeff Yabuki

be pleased the quarter and for our you Peter, your and of with Thanks, along to as of with results insights we future afternoon, very We're our company. combined everyone. today share first good enthusiasm

contributed our better strong up XX%, XX margin and transaction, close excellent expanding an the and to of increasing Data sales following revenue strong. free an internal EPS well to of by guidance even for flow. and cash XXXX. adjusted work for growing revenue First to the to setting to operating Synergy is growth, off July the internal adjusted led us is performance year progressing growth X% This performance growth continues be Financial momentum XX% start

larger operating delivering growth, upon the margin allocation enterprise, capital Although revenue our quarter remain XXbX for High years. have third quality are shareholder Fiserv. dynamic dozen underpinned fully a in are performance and those free and the we a a we more more key reinitiated of repurchase that than cash in flow value tenants lines, strong expansion, disciplined committed program plan. new alive we our share Along late under well to

shares. our We to both repurchase our are and meet in repayment confident ability commitments debt

company. mind building First we is excited integration of are The road we're XXX really the and on integration is of of a one are focus activities promise day and our as of high, coming top Creating combination. transformational this about is Energy Data great Yesterday this ahead. well. was together agenda integration progressing and on the clients number our for teams to foundational success merger our

XXX mentioned a X% a growth off XX% was than share million. to was operating $XXX was cash Adjusted to up quarter in merchant GBS very I revenue per earnings in XX% start internal our quarter more than strong the basis with flow financially As more adjusted and up $X.XX. up we're and the free margin great led XX.X% upfront, business in by points to

$X.XX was margin per again XX% was for to XX% and the up operating adjusted up share For XXX points basis XX.X%. X% GBS up revenue period. year-to-date, growth was internal with earnings the to also Adjusted

$X.X to Free free just flow through was conversion -- excellent billion over up flow XX% September XX% was XX cash at and cash was XXX%.

that that and cash capital an creation We per on basis. flow in a and intently on way continue overall share high a on growing free be focused value to optimizes allocating quality both

progress, synergy Frank further as a new critically to were services. lines, call integration is also strategic XX year-to-date. merchant clients DNA how and a few processing me hub effective pleased around such quality to XX the Account sign our to let signed in Along combination a important in Now before quarter, the those which solutions our and including points manner offerings turn account a position. distribute extends have I cost another and the update six enriches core on share processing business to on proof we on high clients provides you strategic

processing one account in priorities. is client We will Unlocking real continue merchant a highest customers digitally-focused acquiring market and enabling invest leading their value in expanding world. of to time clients across our serve our business our to growth

shipped platform quarter cloud devices seeing and gain of XX% of on which are top through e-commerce year-to-date. a the in XX% also We're over services grew billion XX. across volume point and payment up Clover growth more Add-on last in transactions rapidly opportunities is XX% payment than annualized in Our September growing business threshold quarter, merchant sale more year. both significant than our $XXX based, Clover sales the strong crossed the

integrated these We're Additionally, optimistic the merchant XX% the than digitally-centric our incredibly payments about more businesses. future partners by in growth quarter. expanded ISP potential in

merchant positions focus space. our strategic in digital position distribution expand The opportunity, global rapidly and further strength of as to the key world. in us market the to continued largest of platform highly combination Clover acquirer a this in is commerce, share accelerating our advantaged extend A merchant the bank growth important

and and meaningful We our billion tomorrow. to continues more and to innovation optionality with X electronic the areas norm. network, than today believe embrace enforced combine market such cards as payment, scale for The card positions growth payments in payment create new leadership as ACH Zelle bill

in or are growth. a participate of share in more to tail acceptance cash in looking payments opportunity India, to in Argentina the Europe, participating e-commerce Last, gaining franchise at meaningfully card we long we holistically Brazil global global more growth. in and have significant Whether enabling

and solution scale the As complement, the synergy meaningful revenue combined a identified of further breadth a processing we've U.S. the company. outside leveraging of series opportunities

let that, to With the over me turn Frank. call

Frank Bisignano

part great Fiserv. It's as everyone. new here afternoon, of Good be the to Jeff. Thanks,

earlier, as the even today the we we of this And opportunities XXX and of we're into see a As mentioned days energized companies. I merger wide ahead. more dive great transformational only into two range am business

Let leaders senior first we led power level I this decided business value comprised of far in by both how me reach That that together and the management office. We've conclusion had, teams, put by has start company than to client derived together. it we've imagined many meetings new greater comes when the established stating well proposition the of the is companies. units clients’ from exceptional from

I we great believe of team businesses, the results world. together which will the Jeff each put As and the around across our imagine, drive you carefully considered can leadership and positions

work partnership with to for well. on you senior model transformational our As of engagement may had at build highest associates opportunity and help team global the of I've experiences know, of the in I, The a extraordinarily great to very mergers execute team’s level financial the firsthand and and long-term we benefit more those industry. company clear ensure the seen clients, is ever the the some a members And determination services utilizing with shareholders. along have we're to

highly activities. company, operation and execution engaged large usual the the of company associates, the of as on come fronts; and lifeblood of complex two the successful of essentially When is together is the integration business full companies two set

We're come and to together well at with at thrilled on focus people how matters. the process target our have a both XX across meet including of work minimum million revenue that value. $XXX in we have of companies are pleased million Currently, what will we revenue the streams delivering confident on $XXX We progress client on synergy company the nearly additional next year. focused synergies

addition industry our may over to combination near-term growth the leader how synergy can use we, also In work unique of payments the assets the an we're evolve and sustainable, today. thinking longer-term, how as to drive value, profitable about beyond industry

synergies is one base mentioned, processing high we the Fiserv better quality solutions. the to acquiring account important of of client most distributing serve the through As original merchant revenue

and Enabling significant is original such literally of Clover Fiserv network is being which to validated distributed branch the technologies physical digitally through daily. clients as a opportunity be

financial processing billion, with from there core more XX Of institutions important clients about the resonating proposition. delivering fee with while much signed assets revenue most being $X compelling than needed enhance had clients to their billion pipeline. five is wins, XXX relationship the than and more half We Enabling value raising as have are competitive in takeaways. competitive account already a $X to the clients, very

with reaction, also making which now U.S. our on third market position existing opportunity create along differentiation. identifying largest this card expect is the with network and progress important we revenue further to clients. and The issuing issuer and to Based Accel network ways on we opportunities, extending We're card the million initiative. as enhances in incremental network market routing identified our the and merchant combination originally synergy the revenue of excellent Star $XXX for exceed relationships

$X credit active than and ways. more we cards new with billion addition, debit innovate an to unique have opportunity and in In globally,

have meaningful number go We revenue outside U.S. the our synergies revenue of thesis. beyond a which original identified

solution throughout merchant and as digital important through infrastructure we're issuing hosted solutions scaled the core globally, in to emphasis and delivering payments providing our services modernization, momentum In addition such seeing in world. areas an risk banking, with

additional have or We one opportunities relationship. clients an of have firms also solutions identified influential the provide to original to numerous which both in

how with meeting and the there been mentioned, a we clients to discussion I about additional of As has each Fiserv can combination. deliver pleasure meet the substantial had as value result the number in of

for opportunity delivering future optimistic in-depth value We and white space growth. completed clients analysis client largest the incremental about have holds revenue our an what and for very are

is against does of least that million which time dollars are synergies, first progress making know over savings. include interest not objective achieve. Moving our the as our in revenue, surpass to at five terms and internal we Like cost objectives to excellent both goal years, of $XXX to you

action company Our great to technology We're on corporate with high and achieve the emphasis initial off to a place with to and costs across functions. our focus an identify plans has start in objective. visibility been our duplicate

structure streamline our even is quality solutions while higher our to compelling cost goal to Our more and delivering overall clients.

productivity global Fiserv overall also extend We're the while costs. captive to the product resources leveraging our reducing development of built

meeting contribute objectives. our of engaging which more opportunities efficiency larger in vendor and productive our and will than cost suppliers conversations methodically synergy annual of effectiveness design We're cost One our believe with across the to strength. meaningfully we billion synergy $X is

ensure a governance to $XXX million have saves strong structure our in synergy over actioned We With focus objectives. cost achieve our million have target. against created $XXX annualize we in

week Importantly, expect every grow the level that over probability we of outperformance to increasing period. the

you've we're have targets terms additional synergy confident highly of overachieving and our and timing. quantum in focus an heard in achieving As on

update our Investor to We a any including target increases will Day. full supply March our at

beyond growth best $XXX to revenue the evaluating create to differentiation synergies. way pool the are deploy drive investment also and incremental We innovation million market additional

in risk We opportunities evaluating digital and commerce, solutions and fraud a network are card variety of payments, such areas as innovation.

important We will on you with this more also March. initiative share in

quick with also update progress me venture. a BAMS joint Let our provide on

XXth we JV discussed we a shared we're contractual great deliver on with XXXX well collaboratively July As call, to the process our working in and service ensure through June to dissolve the defined clients. bank our

believe will over the next to years accretive leverage continue be the significant results scale we the that We as within Fiserv’s few company.

over detail turn Bob With call financial on results. our that, the me provide let to to

Bob Hau

Frank, and good you, Thank afternoon.

in start and me X. to attention your X-K October calling reflected filed four Form in on our Let the reported included items results by

will growth methodology. basis constant consistent internal a on First with Data revenue First, the currency be reported

nor than made how FX EBITDA we EPS. different operating is have income to clarity, or not For reported adjustments any FDC adjusted had to which

adjusted now in Next, statement. practice metrics. conform stock-based of back to including First Data its adjusted in earnings compensation compensation our reporting the income previously stock-based added We

revenue consolidation. be results previously quarter this revenue adjusted Data in Beginning operating jointed will First reported owned GAAP with Third, ventures for and for proportional no income. longer its mirror adjusted ventures using adjusted and minority reflected joint

as these reported from Our affiliates. in unconsolidated from investments income of income net share the JVs is

We report dissolution. we proportional reflects using will we this best upon continue that consolidation believe will of to how business BAMS report approach as results the

reporting our four segments. adjusted results Finally, we're across

corporate last, we Data’s which item. original historic two First both business payments segments; into companies’ segments; reflects which single a segments combine Data and Fiserv’s financial, and business First are

this results the the our segment roll for in expect and structure new fashion of report XXXX. year beginning to out will a We remainder in

performance full X% financial up achieve positioned our and strong quarter about was a billion the and nine first revenue billion of strong well September growth quarter the Adjusted X% X% great was all Internal driven $XX.X year-to-date to three the the segments year-to-date. year $X.X are in business feel the by both growth delivering quarter months both in and year to higher XX. to We performance. for revenue and through

quarter to the of performance slightly in the modest ahead XXth our were increased XX% internal will synergies September for operating expectations and accelerate growth income Overall, revenue revenue $X.X in expected, through As of year. up is billion was Adjusted and basis Adjusted over months is time. billion year. to the first $X.X in up the prior XX.X%, quarter the points nine versus the quarter the X% XXX year. operating margin through

you much in of As and some to reinvestments. margin growth cost performance offset Elan was XX.X% also of showing of margin revenue the the acquisition. the points increased know, tax lap had second benefit adjusted up we Fiserv Operating in benefited each expected the operating the stronger synergies, with year we business by increases. limited Year-to-date, segments from partially prior-year XXX by margin basis as original the half

synergy Revenue year synergies million target on XX the action and we've the $XXX than benefits more close, of actioned track $XXX annualized nearly in are run our achieve rate already plans modest. were July of actual cost million. synergy one Given to realized quarter

that We or confident synergy are both the and we exceed highly meet will cost targets. revenue

interest XX% year-to-date. share in of currency per is savings The impact the up in $X.X annually. keep target negative $X.XX to the foreign synergies total and interest per Now the for of and synergy earnings expected results in quarter $X.XX and a $X.XX increased savings cost in included are of to quarter cost that was excess $XXX the Adjusted and share XX% third respectively. target. million billion mind year-to-date included from $X.XX These not

periods growth. from to of In adjusted X% year's First the up year. is XX% September last growth performance points positioned for a consecutive X% North GBS up to excellent adjusted to basis both year divestitures. our double-digit for included compared the $X.X well year-to-date. both QX This for for XXth growth in quarter billion. recording the was These growth segment, GBS than the Data EPS revenue XXX year-to-date include quarter and year-to-date. strong last the both the and through very was are former include for the $X.X billion revenue and we Segment in Overall, and America growth results in These up headwinds XXth also internal achieve results X% quarter and more to segment X% quarter results X%

of growth commerce, primary global drivers acquiring. Solutions, merchant ISV digital Clover The our strong and are

we've have ISV both digital For Overall, added example, ISV than revenues XX,XXX year-to-date locations new year. have contracted more XX% grown this merchant more and low-double-digits globally, merchants. physical, expanded than and

we This seeing which clients credit was plastics mid-single-digits resale treated had are existing trends solid global revenue card FTC a processing, of previously accounts in pass-through on-boarding card the and In issuer growth primarily in on grew file, in as item. new growth quarter. by the portfolios. driven

more and This production, the revenue. original bit Fiserv that headwind now as quarter. plastics becomes a reporting is provides created change adjusted this Given in QX included pronounced a in fourth

issuing places in a of revenue merchant new and International quarter growth growth macros combination has $XXX X% bright the nine and come the First operating billion X% with months internal segment strong income from the quarter to payment million high the in continues is year-to-date. adjusted in Brazil through be such to to teens up increased and And growth and $X.X delivering first Data a spot, year. The India. of business as

up pressure Adjusted Year-to-date, from the operating to growth by and driven offset segment the up in foreign by was quarter, primarily basis cost in XX containment points margin points to adjusted XX margin strong XX.X%. operating revenue was XX.X% currency. basis

enter Data we report or former growth segment don't we plan separately As XXXX, the sub-segment to rates. First

which key financial we'll results. segments, provide and business expected new our best plans financial we with metrics, believe strategic we supply align and As the

XX% including the which million billion Moving Payments acquisition. the in to segment, $XXX year-to-date and $X.X of quarter revenue and to benefit was both respectively, up only, the Fiserv adjusted original is the Elan

quarter for and Internal adjusted to for up and revenue grew operating basis quarter, year was payments up primarily in segment the XX% over in income our XXX Adjusted services, months led than margin operating sequentially to by the margin points $XXX growth year-to-date, prior operating XX.X%, the XXX XX year-to-date. million performance businesses. and first more strong was output in Payments up points nine and basis X% in the solutions X% XX% basis the million points up was the XX.X%. $XXX quarter to Adjusted card electronic

in reduction to continues ASP grew both growth million year-to-date quarter to the in in as last Mobiliti transactions year-to-date. X XX% banking Debit partially U.S. impact the the year's investments, of from quarter October quarter the and and increased services. embrace on Results benefited additional subscribers of XXst. business grew and high-single-digits anniversaried the Mobiliti clients acquisition, digital the tax XX% and revenue Elan funded by the offset which

doubling includes show the PXP quarter, up continued sequentially. Zelle quarter, QX nearly than in strong the which number more nearly XXX the first results quarters of alone X in year. clients last and by to times both clients last the buoyed signed live number Popmoney of QX and combined two sequentially. and transactions, almost transactions year We tripled the signed year in versus the Zelle Zelle doubling XX%

For quarter of year-to-date of third $XXX operating to segment including income than XXX first led X% for was businesses. basis X% in million revenue and at million in $XXX million up the is the through Internal to year-to-date, points quarter X% up $XXX processing and sequentially, X% more to the by transaction, the adjusted months and segment, QX. to segment revenue Financial quarter, our the year. anniversaried X% the the item grew X% the $X.X billion and this up is account Adjusted in nine was which in growth Financial lending end the up

are been to the reduction in a adjusted the which of XX The original XX.X%. offset the has recurring XX high-quality year-to-date benefit both businesses, The growth than given quarter up million periodic than was they the results basis includes appear, up points stronger corporate combined basis year-to-date. quarter operational corporate efficiency. points million operating revenue more XX.X% segment the the expenses of in revenue, by to for and in margin $XX which quarter operating year-to-date loss, and and Adjusted in and $XXX was

fourth Now QX. with consistent to we expect of generally corporate quarter expenses that be the

year the quarter our XX% rate was year. XX.X% to of fourth our is effective for rate quarter, for nine the The the adjusted months XX.X% full be first tax to expect And rate we about be tax tax adjusted XX%. and and

recall continue should to NOL, a the lower First was for a XXX%. free quarter -- $X.X create has tax quarters. which XX% create strong may several to meaningful Data the of cash in is up a next tax billion flow conversion cash with You flow cash rate Free year-to-date and

October. As of transaction. businesses we a two about in XXth and closed normal $XXX quarter our reached in to divest issued $X result represent to quarter. of process, XXX both the lines First portfolio million shares July on per complete product We agreement the These for million management small revenue million Data

in with million X shares longstanding in we late the our million line And repurchased for and strategy. deployment in XXX,XXX $XXX capital shares began quarter about $XX for million year-to-date. shares We September, repurchasing approximately

million of repurchase the end the We have for authorized XX at shares remaining quarter.

historic to X.X was fully and XX% over is about to was combination fixed, $XX.X outstanding to billion returning remain and through XXth, which XX growth. a strong committed next debt debt Total times. as EBITDA the leverage of repayment We months of September XX debt-to-EBITDA level our

With the call that, to Jeff. let back me turn

Jeff Yabuki

and Clover with Fiserv the of and in had We far new larger the as up platform. to deliver a number in signing X% XXX to wins a quarter our journey year-to-date. California performance opportunity the important locations the the begin is We its sales market. XX% Combined such value up Bob. to was quarter DMV Thanks,

solutions. Dash Smart in We XX payment And as across Service all larger the South platform, to also global and with store integrated markets competitive space had and MRI. all North to the chain locations we supermarket our added wins e-commerce such the

Bank than our credit a to of new with with Union Wisconsin's the And Credit dovetail Bank pleased continued We Landmark more assets signed X largest Services. signing with in with assets about Verve, clients new DNA momentum hub. assets. We in $XX billion processes, six $X.X including including union TBK and credit Credit union Managed quarter last, of assets, Alliance bundle value, our and expand Union, nearly billion billion in and $X with to were payment than more Golden with $X.X relationship a in billion also quarter Western in ATM competitive the

is sales remains of Our weighted importantly, million the annual strong revenue. synergies pipeline and approaching pipeline $XXX revenue of

the synergy and sales We experiences Fiserv. new to as the expect grow related the pipeline market

For integrated up through September in the quarter XXth. Fiserv, original XX% was the tracking sales and XX% those

and Operational savings quarter effectiveness performance of million year-to-date. achieved million the remained on track $XX $XX with in

Now on to guidance.

of QX, and purchase year due quarter a expect coming in primarily X% currency including compare, revenue the to around prior Financial growth internal constant with periodic some a We lower X%, for slightly tough revenue revenue segment the our in fourth year better-than-expected adjustments.

of We for expect adjusted full growth the share on to range in points XXX includes impact of EPS year negative earnings growth year, XX%, FX basis adjusted of our more the $X.XX from rate. $X.XX XX% per than which to

We flow operating margins and least by to at conversion free expect basis for approximately the expand XXX XXX%. be points cash year, will that adjusted

will into our in preliminary we XXXX a the performance. are our view planning, of expected Although provide we very midst

official call. be in provided this not or guidance is For data full clarity, our outlook. will Those February

of XXXX at the grow plus the business, considering view XXXX's least minus the existing we earnings the of growth from that per As of X% into share over expected internal continuing synergies XX% today, will revenue strong headwind actual current anticipate adjusted and and performance performance. or FX,

clients, shareholders. investment world. moves our our capacity more And while that unparalleled we followed others opportunity anniversary, underpins XXth associates most year confident way for to an the were First Fiserv. a are Data a moving today that Most aspiration our combined in lead, of information This and the and named and have sixth has help achieve and Company with set, World's scale significant for row, celebrated the Admired solution We in even been for year a importantly, monumental our global money

for together Let XX,XXX around new world you with their serve clients enthusiasm are associates to commitment best. our continuing thank us also Fiserv enterprise the to working truly of Each while building our our at and excellence.

With let's line the open that, Michelle, questions. for

Operator

Instructions]. [Operator

comes Our first Baird. Koning from question with David

ahead, go sir. may You

David Koning

maybe Clover is fast part called has I of like is Global kind digital total of guidance of gotten seems to have Data guys stuff. from big out, happening actually next out North few And to that Yes. start they're that growth First years Solutions all acceleration ISV to kind share the Has over -- is that ago the And growth share an now? kind Is really gaining North X% maybe what growth to America gone And America seems it how accelerate mean, for a in now? actually scale it like now. you year, mode? losing can fast

Jeff Yabuki

So that questions a in Dave, of there. are lot there's

company And add mismatch in and in what what And what an we over Let year-to-date. seeing. XX%, path phone Frank and I'll were kind put as of to XX% technologies start to But such delivered me annualized were making that the something right, team moving had and the think team e-commerce they blanks announced how the in year's a say it Payments the pockets in that growth and lots was what absolutely it, done of GPV it right it to XXth belief business first company Frank and direction. between pieces the perhaps would growing both of to there and that fantastic direction. $XXX you then little which the level, the progress. on the it's at But I that belief that there's billion have still our XX% that Integrated Clover, move will let part have business. take on and was these in prior was actually on when a really is we continue that are Bob January going was and right seeing incredible talk remember we forget, transactions macro was a the to you'll that, partner were more rate. transaction, from -- that. of ISV, got quarter well. Frank Xin the big the of then an testament in have at a investors on were if bit growing has the thinking our fill the just increase about And don't right you And in that solutions about the growth the as with other and management There's

we signed that. The So, we'll new continue this and have on to e-commerce focused of room lot to I think, be run alone. XX business a logos year

our So, we're taking it forward. have businesses obviously, the moving that right don't steps I been international grow. that you... quite believe we And think also why we to And and we're have continue will growing well. Frank,

Frank Bisignano

businesses. would the are I only think these technology-based add is, thing I other

fully with going the in signing. had with top technical grower to technology, e-com to hear bringing thought that those this. And about beginning got strong which period out the when as an America, I that's it of the which and think it BluePay, company, in its wins go back new $X ways clients to the letting company to thrive business, this Clover, to just in the help you you XX And mean, and a it a that Silicon ISV about the bringing Valley in us but on position and time can with clients. it's acquisitions technically for integrating have Jeff position Fiserv privileged Clover that having something But us. talking us, together, XXX-day company you we really thought why about had trajectory And that ask the Then competitive up, us little you you absorb see with. solutions these for are And integrating in double-digit privileged started have these billion were and is the in best Fiserv continue on delighted of from good technology three international bring as share. will in constant clients. able to buying of that we core acquisitions to a is integrated Our bring think that the and market market. North into show were institutions I CardConnect reason that about been was and for growth want continued discussion has star time, investment business, count of that And then, the a a but that to businesses. us great to And if always very all a start in, investment that been I and in us takeaways, partnership you ways I we've the entity.

David Koning

just buybacks I'll ask with partial because and be so think just very now quarter share a you the know count flow to short free important right What going do is in to I QX QX? are you And guys. it's cash follow-up. confusing

Bob Hau

Yes, David, tables think shares is, under in XXbX back bought release, it overall, The there. -- about about September. We're there's it's look press if program. in couple about million the it. that modest to buyback way about to some buying XXX you a think we late started Bob. way in We is talked We have we'll of our

Operator

you. Thank

comes Lisa question from with next MoffettNathanson. Ellis Our

Lisa Ellis

of How you're are you First Thank what's a the historically is of of should international, Not the Can success. got expansion? What priorities the Data together had focus into as converged role about about that? sort geographies? where a looking lot of we bit and about all little now be legacy thinking has for Fiserv. the of entity, a your you've a -- talk guys you you. entity international combined But place area investment priority

Jeff Yabuki

Lisa. Thanks,

to our clients, that that we to I and -- also. banks of it ability And business found first we all, in great our cash do, very, looked talking one First international watched very solutions. good ability targeted. had countries talk very, begin know lots believe clients, there, put and together, set at a that with in and them integrated things favorite each I region, growth to very a of the them that our company, the visit talk institutions, you and Data, was in about cashless, is you've the tools to to both and of payment When like think, then the partner bring country of we skill them, economies to each to runway we run the and take had

So issuing you as to I we merchants Fiserv old many the way have there's there's opportunity the solutions us we of we if And to great take in in And regional have we have where before, to doing job think and bring dovetail think for and which could opportunity said great went hosted products everywhere we great from we brighter good institutions into product clients. this say integrating international, a company. and originally relationships it's for opportunity much heads often spot would to and great started, totality, been with. running a I have our

Bob Hau

that been energy. for diversity, solutions, amount and of the the one side, there's the fair Data of international them diversity I the and we a a Lisa, teams brought our were and think in such would And original Frank scale. didn't run some to and clients the I analysis we big combination recurring presence. And host revenue. for we've because would only we're lot amount been that necessarily take had off to the a party, is small and by the because able of had and the And create where have infrastructure, scale them the extent of to product maybe going add, looking pleasantly put international things First even when country larger of surprised we were a though we we through to Fiserv the opportunities,

products. a in of want and relationships. a lot are jurisdiction, had you There you're of If a lot product, we local

now going got lot and so, energy more we've back forth. will we combined because And we a the have -- reasonable scale. And of company,

outside company. We will to capital the U.S. the benefit the of the makes rest it strategically for and certainly of look deploy sense where

Lisa Ellis

omni-channel? seeing business is -- a Thank for the growth, slightly of you. big sense obviously you're be extremely market that that where those Give And platforms sense multinational should then, some where Thank sort USA? thinking this processor Is contested follow-up us this you number. Is winning? of platform a players? this hotly for a behind a give on where and maybe Is in related Can my XX% hot e-com, wins? the fantastic you're you're we you. back-end transaction small

Frank Bisignano

talked about a and implication accurate, large -- Jeff large been institutions. which of that and the number logos, there's Well, the is are new

large of think players as to aspire have them you should You who brands are that business this with.

in to of that of e-com So institutions large heavy we've fortunate manner. notched are players. wins think I And have bunch it very very, of who a been

our players have business having think but Jeff large totality think been avenues back the And we ISVs. space, rate more the at see what more larger the you somewhat about tax the our at the and the talked business us I medium-sized it's other we're do where being for attaching of processor look not front position when to e-com as a ISV of winning you some shop. small in privileged I of can yeah, and in also a at also, shop a

Jeff Yabuki

company to quite some of able couple Yes, that that OmniPay right the names as The including of we're last names of middle also this year, list middle are a we it's market, has a important industries table the market. really now bring aspirational what there's Frank been into said aware years, space, names amount of extent, in impressive. been seeing this but the number But of most is in over fair to of. in that

we're that a value progress incremental transaction model there. more so And able delivering to building great making we're out on we're where create a we're services So per basis.

think than So, is think, important I I We've but is, it's this than greater world but we understood, the outside understood. certainly far as the early. more had conversation, momentum

Operator

Thank you.

Peller Darrin Wolfe comes with from Our Research. next question

ahead. You may go

Darrin Peller

if touch First US could continuing on look, guys. in little that Data I just on perhaps mentioned Hey, trend bit further rates. down a you want just we again, a we and to more I the strength prior strength to partner mean Clover cross-sell in the If the channels on if hold that, hone break versus Partner has the that JVs, on cross-sells GBS any add their like then, direct strong. or -- has to business, been maybe the of into side just to just you've how business, maybe the the seems solutions in Solutions yet, bank continues upside seen it well. of And source going? through -- started given the growth, even in on to digital your really banking the

Jeff Yabuki

So seen of answer the exactly latter add energy, to-date of from question revenue important about, XXX talked no on let which pipeline and time Frank as Lots and our fee obviously we're first, start will To channel. days in XX help bank to me wins will play now each and that. other a -- interest, and we've in is revenue clients. your large a again Frank looking where important is increasingly lots particularly of in off

there. So lots

We are digital into with solutions Clover making in we which shop. our real technology progress the the in control deeply integrating development

we so with deal of factors that some don't digital performance. And get the in the exogenous of have can to way

to Obviously, Board It's So, that's the to across fact think talked talk locations the things day his that's prepared a up all vertical all focused business really in again, reiterate are things numbers like from merchant. that doing signing time. new driving merchants And we're solution, how new a in e-commerce on and provider remarks just Bob all think the it of about I But stage. really year-over-year. about that, in are overall in we ISV up not to to comes a that together. or at perspective, this at what that the the every important, or And that merchant some good. kind I solutions are the we're out it of double-digit that one talks business technologies who and of signing But partner consultants our be maybe the the are "a little sexier" incredibly is continues digital commerce others. whether things than important

Darrin Peller

one quick the bill pay follow-up just on opportunity. cross-sell is And

Our checks Have white your of space a of evidence Data still. at that? some enterprise pretty around suggesting further First clients seen in there's are amount you

Jeff Yabuki

frame this about either the combination. heard is, of mean, don't the and You of had of number think I number think will influential conversations original the with that without done we've having this the Frank talking stage, businesses a talk meetings clients to best I power it we're having at be about having that way of relationships. the I

about levels horse. also So, we're are But and conversations moving we need the keep card interest don't bullish the ahead processes want quite that, We high. the again, to of but along. the the

Operator

Thank you.

Barclays. El-Assal Our Ramsey with next question comes from

ahead, go may sir. You

Ben Budish

earlier This question wanted Budish share is on a for repurchases. on ask I Ben the Ramsey. to an on follow-up

doing have to immediately. nice that of start to it's confidence So the kind

to of as cash of repurchases of should confidence further kind debt more that, quarterly muted to I'm or the kind a perhaps of more to pace expect And see earlier of than down? while should what historical you're paying kind down flow be given wondering incremental we M&A pay maybe of generation, the maybe Just debt kind that into in expected? should your follow-up we expect norm

Jeff Yabuki

Yes.

remarks in to out plan. So, we XXbX a make that that I sure is the say, things pointed one was under buying our that would we're of prepared

that pace at at we would be the that I say the we means to will so -- which before. market that And not expect we in market. were would be regularly the in

from to debt come cash generation, sure to we committed and will EBITDA. meet that growing flow And absolutely we are a do repayment that. will making agencies commitments We of sure the for our that leverage and combination

So, but from think well, and is that good feel we perspective, flow will cash about strong I we pace it that.

smaller had quarter. also of a in We couple the divestitures

opportunity create we'll as so, as And historically. deploy looking have to to we we can be much as capital

would itself particularly and I M&A say priority, in winning is is. that high market a not differentiating the

I one then our there meeting take it sure our fine. But our from there. and we we're commitments to then allocation we number are opportunities making a normal think M&A it's where that again, priority for capital is deploy us for And so, leverage from disciplined deployment, meet perspective. capital And

Operator

Thank you. David ISI. Togut from Evercore

You ahead, may sir. go

David Togut

Fiserv. new the on congratulations and you Thank

Jeff Yabuki

David. Thanks,

David Togut

growth solutions least any to called growth sales out IT standalone. sales the out highest bank Are XX% believe Jeff, this gaining in drivers quarter, more is at integrated seen there for a major integrated the we've Fiserv You pickup Is call behind that? traction? in I band, which specific

Jeff Yabuki

been specifically proposition, internal And in few making overall have some building that solution as well come with not to that some over the as been in small in investment level product of we a the is has and builds we've last that of do Yes, years that the done value has combination that sets our product of arenas. having the enhancing and market. more digital it really to product our M&A surprisingly

think the it importance So, that digital also then, around others I that I sure of is building IT spend, that that integrated the for in from solutions the risk, areas, we to mobile, be the bring really you're and do through talks products And standpoint, count don't know just in built. talked enhance making And that. to about the Frank solutions that would clients. areas going transformation, merchant places it will it It's around it we've like growth the fraud, I but that deposit further believe is Clover talked about. as most bank we even about normal that matter to wholeheartedly solutions we're --

David Togut

financial, follow-up, then flowing and for you're about XXXX as XXXX? payments versus the then the organic and any synergies Data thinking outlook, you're about preliminary thinking terms of revenue And a in cost you in how can Understood. give First broad cadence outlines what of us and

Jeff Yabuki

will guidance. And Sure. this be with the to that I we say be is at stage me. a things. that not this more the couple more would meant of Bob give, Number happy detail one, not

we're think it keep high pretty level. to a I at going So

say would The I re-segment remember second thing to is, intend that we the company.

we be segmentation model. when it guidance, new give we'll so, across giving And a

of And getting make wouldn't so, I think sense. again that ahead

feel can quite delivered being in is the is At the that company that we higher of tell level, you sustainable. kind that the growth I comfortable

feels Data, XX% around of growth the to But about generally, growth there's our like sustainability you former grow. segments level First three sustainability. a that. in first us, we if around XX% for of ranges to GBS have the so, And think continue quarters. that always going that that quarter, of segment each think And To the will

last and of things and some how we You'll do that have so to in That's all us piece implemented. to say look how step-up on. then, the expect revenues February. revenue you look to and that. that get to that see is was as growth, synergies more continually for sold as we'll And faster -- sustainably right? understand we others. could I it There come on synergies, would the around what some when know, is, have remember for, And loaded synergies, important -- we'll than But that we would that to guidance looks are back-end come internal again, be give the

Operator

you. Thank

Our next question comes Stephens Brett from Huff with Incorporated.

Brett Huff

that of for of kind better the know goalposts it. upside give tougher parts kind is, of than do is on outlook. to the there any Thank could -- kind that, you you perform are like instance drivers? for the downside that you preliminary us just have better on Can give us thing One 'XX maybe to I'd there the where a you around sense where of

Jeff Yabuki

of Sure. we're at guidance, Again, you try the to but the you that level, give Brett, not it stadium not -- level. to remembering kind give goalpost we'll maybe giving at we'll

have move talked give sit come the to had at out And on, do of right does was the lay go. the always, to we us thought how everything right is, things reasonable most visibility line 'XX. to growth about about the for the be X%. least X%. early but to do be across And a that amount And us implementations for variability expected fact have start as sales quickly today, of doesn't on, go we you that a of go, go we to So, to Probably XX-odd come important how way a do there's that to right. they what this lot revenue going here as to how synergies thing we is, lot really as how

Bob a us the ways do we that of are of is good And there that will remind we solid But as be place terms terms ways good a that so, it. we balance feel X%. there'll like to pretty it. later, for feel be this underperform in on outperform me and in in And to will number --

Brett Huff

bit little follow-up the drilling then a into is segment. Data just And down more First the

is versus sense Any helpful. of growth us more kind differential give arrangements on the Can tail told kind us even GBS, big bank longer on you which the between just the and maybe You the the the thoughts performance? and any of channel. qualitatively of JVs there the about referral really growth broad profitability

Frank Bisignano

It's Frank. Yes.

are you the growth, the I to growing good heard I we has of we're XX%. better as about JVs runway investment right? huge. made think delivering to to in ISV billion doing people how always have. at a move think caught is discussion a to getting that still that growth, is investment we it discussion, and But you in that and got as bigger is think us continued what and This got which today long hundreds had you which Clover mark GPD developed $XXX the out And

and heard So, I think it, what in elements of it's all us then you the talking about e-com.

bit, the love we a channel So, dialogue or I'd about a and the from bank a channel. little move more. yes, bank move away JV And

and that XX e-com, Fiserv talk hear privileged understand us distribution. You the each to Clover But ISV, of not would of digital had. one understand I through in I would position about macro the trends try wins those. XXX days

Jeff Yabuki

underlying to the of performance North able to in recognizing the were subsegment, we America. for in And GBS able a known GBS to that's in move revenue, We some of the Yes. think here is, Brett remember, the I more GAAP thing important unshroud as we methodology as were that. unshroud formerly certainly

they for CardConnect we Now going the in the come lot also think the have year. important, contributors. vehicles channel and been contributions for I and other everything bank business last are JVs critically the the say that, the in. not or growing are do original can the that they're said that planted JVs are to be of But better Frank's growth important or them. built I to faster because that the we internal four seeds we're the products those whether would market. be we there that and the will of had or were as BluePay have First smallest time Clover not that a Frank are from development, is three banks pieces faster Data growth grow last it And and come be of to that would point, And contributions -- than to guess or it takes years, that to or

so are those Frank's the -- drivers, just bigger to And that's commentary. reiterate really

Operator

you. Thank

question Shirvaikar comes next Citi. from from Ashwin Our

ahead, You sir. may go

Ashwin Shirvaikar

Hi, Jeff, Frank, journey combined Bob, here. congratulations to start the the good on

Jeff Yabuki

Ashwin. you, Thank

Ashwin Shirvaikar

Yes.

feeding to question kind finish you of on start be I is bit the a and is which you bank So, get to make this And -- have suppositions the bank you're with? pace of prospects at more there? little that mentioned. velocity about broader the remarkable granular went from urgency? clients from subset we was what's it for spending Or IT of kind any Would speaking to wins or limited on can the great

Jeff Yabuki

really about and together believed I talked start, It's in many to that things. was I got the of to the And a processor of Ashwin, we having then, couple to processing U.S. and core a we one and Yes, of get able system be let when me are deep integration world. important. an that. access serendipity in largest core the mean, on was this, really had Frank Frank points the

allow be create different partnerships Ashwin that able that ability to And a integrated merchant more revenue fee customers, and revenue-sharing -- will banks because revenue. important. you create really to is the of are information drive to to these so experience for compelling their levels know fee and And now access integration, integration also right

about we attention great are a we that the opportunity you've as but fact was lot XXX and got we a have to convergence well. had see that that wins especially bit And speaks with that you them. And pay customers fee we the fact so it clients, we and to that at some to about, this it out relationships that talking would little of of anticipated. their ranges love actually great historically, to only the banks think the and And really works haven't go they better -- Frank not think speaks it's where I I the XX get have create serve a And smaller in days. revenue. it than a to these to a quite just paid think -- we talked say going Frank, I additional I end as

Frank Bisignano

off a to a mean, Off I great start. to Yes, great start.

Ashwin Shirvaikar

QX to is then synergies what be Great. XXXX clarification at outlook within -- I better themselves the this least a And due is of doing forces the portion they to point? XQ seem components at have raise

Jeff Yabuki

have synergies know, have of for next I couple we the saves There single are be fact low They're pop our companies. in in numbers something vis-à-vis Ashwin, for synergies, this important would as we less the expense mean, in I rate would of had of part of the quarter. million some than you people guidance. interest annualized to going numbers of we dollars. consider I the But the say that that will year. of And quarter. say set in not year. our very how next that about idea But run be on low Yes. synergies majority an have meaningful probably synergies hundred the synergy the talked substantial very what XXXX actioned impact would the original driver that a biggest any our prior next is synergies

Operator

Greene from Glenn Oppenheimer. you. Thank

go ahead. You may

Glenn Greene

I synergy revenue I'm like confident guess, the million it this sounds you're number. sounds $XXX like in question, it the reading -- maybe into first increasingly but

really appreciated a more million? upside that or talked what are on incremental you in confidence but thought that see to that it opportunities early opportunity You've $XXX fully gives the bit maybe areas had specifically relative you about the where you you

Jeff Yabuki

actually Yes. not can out. going talk go turn them that have you're to I mean them, you this we it's banks, sure with visit position the and to privileged how until really all

our we that both this had they all of would financial knew way out and lifeblood. clear. we But whether love deep Now, it were wasn't institutions that turn

and client's worth the will so so it the revenue to to like the then it. the right? to have has it franchise business that speak, the in bullish when benefit move these better come always client you we we save And clear. I been case, putting had of and multiple I that for it's be there Maybe So, haul, most all credit that's separately. and than only had no out we like becomes we we with obviously a biggest two to come pretty going people Jeff I'd and power credit us. would some together we proof you That's office, But spaces There's us feel long together, opportunity big secondly, Output we very our money. good us say thing international. and I'd heck money. put point thought about on. over don't tremendous the will of and more doing be something out the opportunities I is obviously, be like But it's meetings base about thought. do for so heard initially the and probably clear thought a the Network say, when things how to together, more of opportunity. about large. is we'd two think lot And talk our then, think

So, when on did XXX we days we we saw feel the in, than it better journey.

Glenn Greene

Yes.

Jeff Yabuki

Glenn, a million. have together to in $XXX we better. to we opportunities also we detail I we you And to Investor may mean, really Day where good in And it's until it see are wait heard our think -- layout us we little how do for and the I think confidence coming bit prudent see

Glenn Greene

at what question XX% a context growth the level seeing but bookings some the quarter, will you're a I I the on mean the Okay. be environment. businesses. follow-up across And then, bread heard high in just just selling

too. seeing are good results peers really obviously Your

macro concern the it's the are of of not lot of So it. economy, but companies kind a in lot curious, a about sector seeing

So I'm seeing? you're just curious what

Jeff Yabuki

Sure.

and I primarily if really not does and the to something institutions you aperture Fiserv about for -- have We're world had us it. just to money do We've you that original serving think anymore. movement So, everyone at the in open would about least of say to -- who we're fintech. payments, for you us financial We're happy serving people. think commerce,

institutions is what's their And spend where it's going most happening it in so, And ecosystem, is a entire financial the biasing to visible that you when -- standpoint, areas which their -- lot on. to there's from think are about in most financial institutions customers.

they're make the because the now. have and I we and we're company been collectively it's to on for years, that then, and sorry, over things clients fairly the just we way need So the go. they whether the What what it's do money really making And think, is are abilities we is few seeing breadth most sure to our you're continue that entire way. really digital -- is that's whether fraught deliver commitments money that in to digital, consumer And an or our serve where last that that of commercial of clients payments space Amazon-like that make everyone have by sure and right we energy well-positioned. meet movement innovation investments that's looking with just to because

Operator

Thank you.

from Mehta comes question North Research. next from Coast Our Kartik

ahead. go may You

Kartik Mehta

your outlook to just Jeff, this get XXXX on think, thoughts. all answer your in your I I know the XXXX, based wanted guidance but commentary for and to

on not and margin. see conversations over as at you far least you they're getting and their that's an interest banks reason that's having place kind assuming that of interest As are the as moving your the net all pressure with rates I'm confidence have their and on fair? Is in for spend impact can XXXX.

Jeff Yabuki

would not it I to probably before impact is are too institutions having this say seen seeing I say on any we've what say, -- is. spend, and we're it's would But bold it's their in matter less on systems choices. discretionary and more the systems places they're their going newer making is institution most. on again the where older or Perhaps spending down meets spend customer the that

we that have and win on. more, you see you conversations do a do the go in like and where I this provider, So, full-scale how are going are And times opportunities to do more business. in

we And we best so, we're and suite the the think fact market. that balance hoping that in the around strategy certainly on bring the is building

Frank's doing of there's enterprise. have as do larger lot interest effectively client to and in you opportunity and to things. more see, about looking we're There's so, more we can efficiently how point And a one conversations things

think a new is, And some this together was We yeah, are we in that that one hand, of so, market best be and the things innovative integrate put gives to a play. it's the ways Kartik, us on things, being and that transaction to ability pure broad of and say one there advantage. about liked bit

Kartik Mehta

Frank. And just question for one you, last

you Clover? -- As are is changed versus you the let's ago, over for that Clover is evolve been at XX there type And of a change in sake customers year about Clover our of XX at all? a the months, to conversation, see as using just look take the customers next, today that

Frank Bisignano

to Clover I think of see the it breadth larger. continues

I think dining in delivering and solutions we if about you go to talked back time, restaurants.

gone vertical the functionality our teams continuing So, our breadth more that outside what depth. to gives development build U.S. doing are We've that is us

in You see us Canada.

You see Europe. us in

we ability build on Argentina in were what who that to to releases ISV solution combination of how the as say change, our Clover you'll merchants a strategy. in strategic best-in-class software the two and together capitalize Clover, I America. Latin with see in happen. advantaged of also as for for the You that to bring would expect use tremendously integrated functionality is solution should continue We've been and out we was part the

the So, and the rest answer short the yes, is how description where. answer -- the was of and

Jeff Yabuki

support. thank And We for this Kartik. really Thanks, joining afternoon. you, everyone, appreciate us your

have contact don't you team. Investor a please our to hesitate further questions, evening. great If Relations Have

Operator

Thank you. concludes today’s This conference.

at disconnect may this time. You

Fiserv (FI) 6 Nov 192019 Q3 Earnings call transcript