Fiserv Reaffirms 2026 Outlook as Financial Solutions Returns to Organic Growth

Fiserv (FISV) reaffirmed its 2026 guidance after third-quarter organic revenue was flat, as renewed organic growth in Financial Solutions offset a decline in Merchant Solutions. The payments and financial technology company expects adjusted and organic revenue to return to growth in the fourth quarter and doubled its Project Elevate savings target to $1 billion from $500 million.

For the quarter ended September 30, GAAP revenue declined 1% year over year to $5.20 billion. Adjusted revenue, which excludes postage reimbursements, also fell 1% to $4.85 billion, while organic revenue was unchanged. For the first nine months of 2026, adjusted and organic revenue each decreased 3%.

Adjusted operating income fell to $1.51 billion from $1.82 billion a year earlier, and adjusted operating margin contracted 580 basis points to 31.2%. Adjusted earnings per share declined 14% to $1.75. Fiserv said third-quarter adjusted revenue was in line with the outlook it provided on August 6.

On a GAAP basis, the company reported a net loss attributable to Fiserv of $5.94 billion, or $11.17 per diluted share. The result included a $6.45 billion noncash goodwill impairment charge tied to a triggering event associated with sustained declines in the company’s share price and market capitalization. The after-tax impairment adjustment was $6.40 billion.

Financial Solutions returns to organic growth

Financial Solutions generated $2.33 billion of adjusted revenue, approximately unchanged from the prior year, while organic revenue increased 2%. That marked a return to organic growth for the segment, although year-to-date organic revenue remained down 4%.

Issuing was the strongest business line, with revenue rising 5% to $840 million and organic revenue increasing 7%. Accounts on file grew 5%, and the company said key implementations went live during the quarter.

Digital Payments revenue declined 3% to $914 million but was flat organically. Payment Platform transactions increased 4%, while Consumer Payments transactions decreased 1%. Zelle transaction growth was 23%.

Banking revenue fell 3% to $577 million and declined 5% organically. Core accounts and positions, including Finxact, grew at a high-single-digit rate. Fiserv said core banking net attrition improved by more than 25% year to date, with losses improving by a double-digit percentage and wins increasing by more than 50%. The company said it remains on track to return to historical attrition levels.

Financial Solutions’ adjusted operating margin was 38.1%, compared with 42.5% in the third quarter of 2025.

Merchant Solutions pressured despite Clover volume growth

Merchant Solutions adjusted revenue decreased 3% to $2.52 billion, with organic revenue down 2%. Adjusted operating margin fell to 28.7% from 37.2% a year earlier.

Small Business revenue declined 2% to $1.71 billion and was down 1% organically. Enterprise revenue fell 3% to $561 million on both an adjusted and organic basis, while Processing revenue decreased 7% to $247 million. Global Small Business volume grew 2%, in line with the second quarter, and Enterprise transactions increased 5%.

Clover gross payment volume rose 11% year over year when volume related to a previously disclosed gateway conversion was excluded. Reported GPV increased 9%, and annualized third-quarter GPV reached $368 billion. Clover processing revenue grew 12%, but total Clover revenue increased 1%.

Value-added services penetration was 23%, down from 26% a year earlier. Fiserv said penetration was stable when anticipation was excluded. The company continues to expect Clover GPV growth of 10% to 15% for 2026, excluding the gateway conversion, and expects total reported Clover revenue to return to double-digit growth in the fourth quarter.

Guidance maintained, capital return planned

Fiserv reaffirmed its 2026 outlook for organic revenue growth of negative 1% to flat and adjusted revenue growth of negative 1.5% to negative 0.5%. The company continues to expect an adjusted operating margin of 31% to 31.5% and adjusted EPS of $7.20 to $7.40.

Free cash flow conversion is expected to be approximately 90% of adjusted net income. Management also projects a 19% adjusted effective tax rate and capital expenditures at a high-single-digit percentage of adjusted revenue.

Third-quarter free cash flow was $679 million, while capital expenditures totaled $482 million. Trailing 12-month free cash flow conversion was 91%, compared with 93% for the 12 months ended September 2025. Fiserv did not repurchase shares during the third quarter but expects to buy back $500 million of stock in the fourth quarter.

The outlook remains subject to risks including competitive pressure, changes in customer demand, execution of the One Fiserv action plan, technology and cybersecurity failures, the performance of merchant alliances, regulation, economic and political conditions, currency movements, acquisitions and the possibility of additional noncash goodwill impairment charges.