Fiserv (NASDAQ:FISV) reported second-quarter results that were in line with its guidance, while lowering its full-year revenue and margin outlook as Argentina-related pressures, delayed client implementations, hardware sales trends and additional technology spending weigh on its second-half expectations.
Chief Executive Officer Takis Georgakopoulos, who recently assumed the role, said the company generated more than $1 billion in free cash flow during the quarter and continued to see growth in its Clover payments platform. Clover gross payment volume rose 9%, while Clover revenue increased 13% after adjusting for anticipation and non-recurring revenue, according to the company.
Second-Quarter Results and Segment Performance
Total second-quarter adjusted revenue was $4.96 billion, down 4% from a year earlier, while organic revenue declined 5%. Recurring revenue grew 2% and represented 84% of adjusted revenue, according to Chief Financial Officer Paul Todd.
Adjusted operating income totaled nearly $1.6 billion, producing an adjusted operating margin of 31.8%. Adjusted earnings per share were $1.84, and free cash flow reached $1.1 billion, representing 112% conversion. Todd said foreign-exchange rates in Latin America reduced adjusted EPS by $0.07 year over year.
Fiserv’s Merchant Solutions segment reported adjusted and organic revenue declines of 1%. Small-business volume grew 2%, with the company citing the anniversary of its CCV acquisition as a factor in the lower growth rate compared with the first quarter. Enterprise transactions rose 8%.
Clover revenue increased 2% on a reported basis. Excluding higher non-recurring revenue in the second quarter of 2025, Clover revenue would have increased 11%, Todd said. Excluding attrition, Clover revenue would have grown 13%. Clover GPV grew 9% as reported and 11% excluding a gateway conversion.
Merchant Solutions adjusted operating income declined 14% to $781 million, and the segment’s adjusted operating margin was 30%.
Financial Solutions adjusted and organic revenue each declined 8%, primarily reflecting higher non-recurring revenue in the year-earlier period. Within the segment, payment platform transactions increased 5%, while consumer payment platform transactions fell 1% as growth in Zelle was offset by slower Bill Pay activity. Global accounts on file increased 4%, and overall accounts and positions, including fintech, grew 6%.
Financial Solutions adjusted operating income fell 27% to $912 million, with an adjusted operating margin of 38.7%.
Updated 2026 Outlook
Fiserv now expects full-year organic revenue growth in a range of negative 1% to flat, compared with its prior expectations for stronger second-half growth. Adjusted revenue is expected to decline between 1.5% and 0.5% for the full year. The company expects adjusted operating margin of 31% to 31.5% and adjusted EPS of $7.20 to $7.40.
For the second half, Fiserv expects adjusted revenue growth of about 2%, including a low-single-digit decline in the third quarter followed by mid-single-digit growth in the fourth quarter.
- About 2 percentage points of second-half impact from delays in newly contracted revenue and enterprise client ramps.
- About 1 percentage point of impact from lower key-product and other revenue, including hardware.
- About 1 percentage point of impact from Argentina anticipation revenue.
- About 1 percentage point of impact from divestitures.
Todd said the company expects to recognize the “vast majority” of delayed revenue, but at a later date. Georgakopoulos cited one large client whose planned September or October launch was delayed as the client undergoes a merger or acquisition process.
Argentina anticipation revenue reduced second-quarter adjusted revenue growth by 90 basis points and adjusted operating margin by 60 basis points, Todd said. Fiserv also cited softer expected hardware sales in its merchant business, following elevated hardware sales over the prior two years.
The company plans to invest more than $100 million incrementally in technology infrastructure during the second half, particularly within Financial Solutions. The investment will focus on infrastructure and cybersecurity, with the company aiming to improve platform stability, resiliency and client service.
Portfolio Review, Technology Strategy and Client Wins
Georgakopoulos said Fiserv is expanding its review of businesses, products and capital commitments. The company has decided to divest its student loan servicing and managed ATM businesses and to exit unprofitable small-business and fuel segments in India. One of the two previously announced divestitures closed Aug. 5, and the other is expected to close in the third quarter.
The company plans to use divestiture proceeds for a combination of capital returns and debt reduction. Fiserv ended the quarter with gross debt-to-adjusted EBITDA below 3.2 times and continues to target approximately 3 times leverage by year-end.
Georgakopoulos said the review will extend beyond lower-growth businesses to assess whether individual products are best-in-class and whether Fiserv has the ability to compete effectively in each area. He said the company would consider alternatives for products where it does not see a clear path to compete, while seeking to avoid disruption to clients.
Fiserv said it has completed the identification phase of Project Elevate, its effort to identify at least $500 million in savings opportunities, and is prioritizing the largest initiatives. The company remains committed to about 50 basis points of annual adjusted operating-margin expansion beginning in 2027 and more than 200 basis points of total expansion from Project Elevate by 2029.
On the product front, the company said Western Alliance Bank went live on Clover, bringing the number of top 100 U.S. banks working with the platform to nearly 40. Its partnership with TD in Canada continues to expand, with Fiserv planning to convert TD’s existing merchant portfolio beginning in 2027. Fiserv also said Clover Practice Pay merchants have approximately 20% higher average volumes than its average small-business merchant.
In Financial Solutions, UW Credit Union selected Fiserv’s DNA platform as its future core banking system, while Flagstar Bank selected Finxact as the foundation of its core modernization strategy. Fiserv said Finxact positions and accounts grew more than 75% and noted that more than 100 financial institutions have shown interest in its agentOS offering since its announcement.
Fiserv also announced a strategic partnership with Mastercard to integrate Mastercard Merchant Cloud into Fiserv Commerce Hub. Georgakopoulos said the integration is expected to take a couple of quarters and is intended to expand the companies’ combined capabilities in enterprise payments.
About Fiserv (NASDAQ:FISV)
Fiserv, Inc, founded in 1984 and headquartered in Brookfield, Wisconsin, is a global provider of financial services technology. The company develops and delivers integrated solutions for payments, processing, risk and compliance, customer and channel management, and business insights and optimization. Serving thousands of clients, Fiserv supports banks, credit unions, securities broker-dealers, leasing and finance companies, and retailers.
Fiserv’s core offerings include account processing systems that automate deposit, lending and transaction processing for financial institutions, as well as digital banking platforms that enable mobile and online banking services.
