Summary
Fiserv Inc. (FISV) reported solid results for the first quarter of 2015, demonstrating continued growth and operational improvements. Total revenue increased by 3% to $1.275 billion, driven by a 3% rise in both the Payments and Financial segments. This revenue growth was primarily fueled by an increase in processing and services revenue, reflecting new client acquisitions and higher transaction volumes. Despite a slight increase in total expenses, operating income saw a significant jump of 16% to $314 million, leading to an improved operating margin of 24.6%. This was supported by operational efficiencies and lower selling, general, and administrative expenses, particularly reduced employee severance costs. Net income rose to $178 million from $168 million in the prior year period, resulting in diluted earnings per share of $0.73, up from $0.65. The company generated strong operating cash flow of $346 million, an 18% increase, which was primarily used for debt repayment and share repurchases. Fiserv also announced an amendment to its revolving credit facility and term loan facility, extending maturity dates and releasing subsidiary guarantees, indicating proactive capital structure management. The company reiterated its focus on building high-quality revenue, extending client relationships, and driving innovation.
Financial Highlights
46 data points| Revenue | $1.27B |
| Cost of Revenue | $181.00M |
| Gross Profit | $1.09B |
| SG&A Expenses | $238.00M |
| Operating Expenses | $961.00M |
| Operating Income | $314.00M |
| Interest Expense | $41.00M |
| Net Income | $178.00M |
| EPS (Basic) | $0.38 |
| EPS (Diluted) | $0.36 |
| Shares Outstanding (Basic) | 477.60M |
| Shares Outstanding (Diluted) | 486.00M |
Key Highlights
- 1Total revenue increased 3% year-over-year to $1.275 billion in Q1 2015.
- 2Operating income grew 16% year-over-year to $314 million, with operating margin expanding to 24.6%.
- 3Net income rose to $178 million, or $0.73 per diluted share, compared to $168 million, or $0.65 per diluted share, in Q1 2014.
- 4Operating cash flow increased by 18% to $346 million, driven by higher earnings and favorable working capital changes.
- 5The Payments segment revenue grew 3%, driven by card services and digital channels, while the Financial segment revenue also grew 3%, supported by account processing and lending businesses.
- 6Selling, general, and administrative expenses as a percentage of revenue decreased due to lower employee severance costs.
- 7Subsequent to the quarter, Fiserv amended its revolving credit facility and term loan, extending maturity dates and adjusting covenants.