Summary
Fiserv, Inc. reported robust financial performance for the fiscal year ended December 31, 2016, with total revenue reaching $5.5 billion, a 5% increase year-over-year, driven primarily by its Payments segment. The company operates in the critical financial services technology sector, providing essential services to a diverse client base including banks, credit unions, and merchants. Revenue from these non-discretionary services is largely recurring, stemming from account- and transaction-based fees under multi-year contracts with high renewal rates. The company continues to focus on strategic initiatives including active portfolio management, enhancing client relationships, operational efficiency, capital discipline, and innovation to drive long-term growth and profitability. Fiserv's financial health is demonstrated by strong operating income and cash flow from operations. The company actively manages its capital structure, including debt repayment and share repurchases, rather than paying dividends. Despite operating in a highly competitive and rapidly evolving technology landscape, Fiserv's diversified product offerings, strong client relationships, and strategic acquisitions position it to capitalize on industry trends like digitalization and increased demand for electronic payment solutions. Key risks include competitive pressures, technological advancements, regulatory changes, and cybersecurity threats, which management actively addresses through ongoing investment and strategic planning.
Financial Highlights
48 data points| Revenue | $5.50B |
| Cost of Revenue | $747.00M |
| Gross Profit | $4.76B |
| SG&A Expenses | $1.10B |
| Operating Expenses | $4.06B |
| Operating Income | $1.45B |
| Interest Expense | $163.00M |
| Net Income | $930.00M |
| EPS (Basic) | $2.11 |
| EPS (Diluted) | $2.08 |
| Shares Outstanding (Basic) | 440.60M |
| Shares Outstanding (Diluted) | 447.80M |
Key Highlights
- 1Total revenue for 2016 reached $5.5 billion, a 5% increase from the previous year, primarily driven by an 8% growth in the Payments segment.
- 2Operating income grew by 10% to $1.4 billion, with operating margins expanding to 26.2% from 24.9% in 2015, reflecting strong operational effectiveness and revenue growth.
- 3Net cash provided by operating activities was robust at $1.43 billion, showcasing the company's ability to generate significant cash from its core operations.
- 4Fiserv completed two strategic acquisitions in Q1 2016 for an aggregate of $265 million, enhancing its digital banking and payments solutions.
- 5The company maintains a strong liquidity position with $300 million in cash and equivalents and $1.4 billion available under its revolving credit facility as of December 31, 2016.
- 6Fiserv actively repurchased approximately $1.20 billion of its common stock in 2016, demonstrating a commitment to returning value to shareholders.
- 7The company's business model relies heavily on recurring revenue from long-term contracts (3-5 years) with high renewal rates, providing revenue stability.