Slide 1: Third Quarter 2023 Financial Results
Third Quarter 2023 Financial Results October 24, 2023
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures
Forward-Looking Statements and Non-GAAP Financial Measures Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding anticipated organic revenue growth, adjusted earnings
Slide 3: Third Quarter Highlights
Third Quarter Highlights • Adjusted Revenue of $4.6 billion, up 8% • Strong financial results drives higher outlook on all key financial metrics • Organic Revenue Growth of 12% • Announced strategic exclusive partnership with Melio for • Adjusted Earnings Per Share of $1.96, up 20% AR/AP solution •
Slide 4: Financial Metric Dashboard
Financial Metric Dashboard Organic Growth: 3Q23 +12% | YTD +11% Adjusted Revenue Adjusted Operating Margin % +8% | +8% +290bps | +250bps 39.2% $4,615 38.1% $4,506 36.5% $4,273 $4,360 $4,280 35.2% 33.6% 3Q22 4Q22 1Q23 2Q23 3Q23 3Q22 4Q22 1Q23 2Q23 3Q23 Adjusted EPS Free Cash Flow +48% | +29% +20% | +
Slide 5: Merchant Acceptance Segment
Merchant Acceptance Segment Organic Growth: 3Q23 +20% | YTD +17% Adjusted Revenue Highlights +12% | +11% 26% Clover revenue growth $2,065 $2,106 $1,878 $1,860 $1,847 $272 billion Clover annualized GPV, up 15% 6% and 9% volume and transaction growth, 3Q22 4Q22 1Q23 2Q23 3Q23 excluding wholesale proce
Slide 6: Payments and Network Segment
Payments and Network Segment Organic Growth: 3Q23 +6% | YTD +9% Adjusted Revenue Highlights +5% | +8% Continue to expand open $1,623 $1,671 $1,635 $1,650 $1,709 data access, new deal with Plaid will allow direct links to our bank clients 44% and 26% growth in Zelle® transactions and number of client
Slide 7: Financial Technology Segment
Financial Technology Segment Organic Growth: 3Q23 +6% | YTD +3% Adjusted Revenue Highlights +4% | +1% 8 core wins, including $766 $823 $792 $784 $795 3 with assets >$1B 2 more credit union wins, as they scale up to DNA Strong margin expansion 3Q22 4Q22 1Q23 2Q23 3Q23 from productivity and scalabilit
Slide 8: 2023 Performance Outlook
2023 Performance Outlook Key Financial Metrics Previous Updated Organic Revenue Growth 9% – 11% 11% Adjusted EPS $7.40 – $7.50 $7.47 – $7.52 (14% – 16% growth) (15% – 16% growth) Other Financial Metrics Adjusted Operating Margin Expansion ≥150bps >175bps Free Cash Flow ~$3.8B ~$4.0B See Appendix for
Slide 9: Appendix
Appendix Recognized by Fortune® Magazine 9 © 2023 Fiserv, Inc. or its affiliates. World’s Most Admired CompaniesTM 2023
Slide 10: Non-GAAP Financial Measures
Non-GAAP Financial Measures Use of Non-GAAP Financial Measures This presentation includes the following unaudited non-GAAP financial measures: “adjusted revenue,” “adjusted revenue growth,” “organic revenue,” “organic revenue growth,” “adjusted operating income,” “adjusted operating margin,” “adjust
Slide 11: 3Q23 Revenue Details
3Q23 Revenue Details Merchant Payments Financial Corporate Total Acceptance and Network Technology and Other Company GAAP revenue $2,106 $1,704 $795 $268 $4,873 Output solutions postage reimbursements - - - (263) (263) Deferred revenue adjustments - 5 - - 5 Adjusted revenue $2,106 $1,709 $795 $5 $4,
Slide 12: Adjusted Revenue and Adjusted Operating Income
Adjusted Revenue and Adjusted Operating Income Total Company 3Q23 2Q23 1Q23 4Q22 3Q22 YTD23 YTD22 Revenue $ 4,873 $ 4,756 $ 4,547 $ 4,631 $ 4,518 $ 14,176 $ 13,106 Adjustments: Output Solutions postage reimbursements (263) (255) (273) (277) (251) (791) (712) Deferred revenue purchase accounting adju
Slide 13: Adjusted Revenue and Adjusted Operating Income by Segment
Adjusted Revenue and Adjusted Operating Income by Segment Merchant Acceptance Segment 3Q23 2Q23 1Q23 4Q22 3Q22 YTD23 YTD22 Revenue $ 2,106 $ 2,065 $ 1,847 $ 1,860 $ 1,878 $ 6,018 $ 5,432 Operating income $ 757 $ 718 $ 562 $ 648 $ 610 $ 2,037 $ 1,673 Operating margin 35.9 % 34.7 % 30.5 % 34.8 % 32.4
Slide 14: Adjusted Revenue and Adjusted Operating Income by Segment
Adjusted Revenue and Adjusted Operating Income by Segment Payments and Network Segment 3Q23 2Q23 1Q23 4Q22 3Q22 YTD23 YTD22 Revenue $ 1,704 $ 1,645 $ 1,629 $ 1,665 $ 1,617 $ 4,978 $ 4,597 Adjustments: Deferred revenue purchase accounting adjustments 5 5 6 6 6 16 19 Adjusted revenue $ 1,709 $ 1,650 $
Slide 15: Adjusted Revenue and Adjusted Operating Income by Segment
Adjusted Revenue and Adjusted Operating Income by Segment Financial Technology Segment 3Q23 2Q23 1Q23 4Q22 3Q22 YTD23 YTD22 Revenue $ 795 $ 784 $ 792 $ 823 $ 766 $ 2,371 $ 2,347 Operating income $ 291 $ 285 $ 280 $ 340 $ 261 $ 856 $ 817 Operating margin 36.7 % 36.3 % 35.4 % 41.3 % 34.1 % 36.1 % 34.8
Slide 16: Adjusted and Organic Revenue by Segment
Adjusted and Organic Revenue by Segment Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 Growth 2023 2022 Growth Total Company Revenue $ 4,873 $ 4,518 8% $ 14,176 $ 13,106 8% Output Solutions postage reimbursements (263) (251) (791) (712) Deferred revenue purchase accountin
Slide 17: Adjusted and Organic Revenue by Segment (cont.)
Adjusted and Organic Revenue by Segment (cont.) Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 Growth 2023 2022 Growth Payments and Network Revenue $ 1,704 $ 1,617 5% $ 4,978 $ 4,597 8% Deferred revenue purchase accounting adjustments 5 6 16 19 Adjusted revenue $ 1,709 $
Slide 18: Adjusted Net Income and Adjusted EPS
Adjusted Net Income and Adjusted EPS 3Q23 2Q23 1Q23 4Q22 3Q22 YTD23 YTD22 GAAP net income attributable to Fiserv $ 952 $ 683 $ 563 $ 782 $ 481 $ 2,198 $ 1,748 Adjustments: Merger and integration costs 1 30 42 48 58 54 120 115 Severance costs 15 13 24 75 35 52 134 Amortization of acquisition-related
Slide 19: Adjusted Net Income and Adjusted EPS (cont.)
Adjusted Net Income and Adjusted EPS (cont.) 1 Represents acquisition and related integration costs incurred in connection with various acquisitions. Merger and integration costs associated with integration activities primarily include $39 million of share-based compensation and $52 million of third
Slide 20: Free Cash Flow
Free Cash Flow 3Q23 2Q23 1Q23 4Q22 3Q22 YTD23 YTD22 Net cash provided by operating activities $ 1,559 $ 878 $ 1,130 $ 1,633 $ 1,180 $ 3,567 $ 2,985 Capital expenditures (355) (340) (339) (331) (430) (1,034) (1,148) Adjustments: Distributions paid to noncontrolling interests and (8) (6) (8) (12) (8)
Slide 21: Additional Information – Amortization Expense
Additional Information – Amortization Expense Total Amortization 3Q23 3Q22 YTD23 YTD22 Acquisition-related intangible assets $ 393 $ 450 $ 1,261 $ 1,416 Capitalized software and other intangibles 133 91 360 258 Purchased software 53 67 167 180 Financing costs and debt discounts 10 11 30 33 Sales com
Slide 22: 2023 Performance Outlook - Organic Revenue Growth
2023 Performance Outlook - Organic Revenue Growth Growth 2023 Revenue 7.5% Output Solutions postage reimbursements (0.5%) 2023 Adjusted revenue 7% Currency impact 1 3.5% Acquisition adjustments (0.5%) Divestiture adjustments 2 1% 2023 Organic revenue 3 11% See page 10 for information regarding non-G
Slide 23: 2022 Adjusted Net Income and Adjusted EPS Reconciliation
2022 Adjusted Net Income and Adjusted EPS Reconciliation 2022 GAAP net income attributable to Fiserv $ 2,530 Adjustments: Merger and integration costs 1 173 Severance costs 209 Amortization of acquisition-related intangible assets 2 1,814 Non wholly-owned entity activities 3 9 Net gain on sale of bu
Slide 24: 2022 Adjusted Net Income and Adjusted EPS Reconciliation (cont.)
2022 Adjusted Net Income and Adjusted EPS Reconciliation (cont.) 1 Represents acquisition and related integration costs incurred in connection with various acquisitions. Merger and integration costs associated with integration activities primarily include share- based compensation and third-party pr
Slide 25: 2022 Adjusted Revenue and Adjusted Operating Income Reconciliation
2022 Adjusted Revenue and Adjusted Operating Income Reconciliation 2022 Revenue $ 17,737 Adjustments: Output Solutions postage reimbursements (989) Deferred revenue purchase accounting adjustments 25 2022 Adjusted revenue $ 16,773 2022 Operating income $ 3,740 Adjustments: Merger and integration cos