Key Points
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This, despite slumps in both revenue and profitability.
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Analysts were expecting a worse bottom-line showing, however.
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Fiserv (NASDAQ:FISV), one of the sturdier and more experienced fintechs on the market, had a Tuesday to remember as far as its equity was concerned. After it served up an encouraging quarterly earnings report in the morning, investors eagerly bought the company’s shares to send them almost 13% higher across that trading session.
Bottom-line beat
Fiserv’s third-quarter revenue not under generally accepted accounting principles (non-GAAP, or adjusted) slid by 1% year over year to $4.85 billion. Despite the slide, that figure was essentially in line with the consensus analyst estimate.
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As for profitability, adjusted net income fell more steeply, decreasing by 15% to $936 million, or $1.75 per share. Those Fiserv-tracking pundits were expecting a slightly sharper fall, since they were collectively estimating $1.72.
Fiserv said in its earnings release that the erosion in revenue it suffered in its key banking customer segment was improving notably. Clients didn’t migrate away from Fiserv back-end solutions as much as they had in other recent quarters, while the company reported “major client wins” in that business.
Investors were also heartened by management’s doubling of its Project Elevate cost-saving and automation target to $1 billion from $500 million. Another confidence booster was the company’s news that it would resume its share repurchase program, with a goal of buying back $500 million worth of stock in the current (fourth) quarter alone.
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Fiserv maintained its full-year 2026 organic revenue guidance of a slump of 1% to break-even when matched against the previous year’s figure. It’s also sticking to its adjusted EPS forecast of $7.20 to $7.40, which is well down from the $8.64 it posted in 2025.
While no investor likes to see declines in either trailing results or guidance, Fiserv’s moves position it for renewed growth in the near future. So now feels like it might be an opportune time to buy into the company’s (hopefully continuing) recovery story.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
