The payments giant released quarterly results Tuesday (Feb. 10) showing the company navigating shifting consumer spending patterns amid a multi-year push to modernize its technology platforms. The company’s performance reflected broader economic trends, particularly a brief dip in discretionary spending during the early holiday season.
“During the fourth quarter, which marked the first full quarter executing the One Fiserv plan, the team took decisive steps and achieved several meaningful milestones and client wins, while also delivering performance in line with our expectations,” said CEO Mike Lyons.
The company’s adjusted revenue was flat at $4.9 billion for the fourth quarter, and up 4% to $19.8 billion for the full year. Organic revenue came in flat for the fourth quarter, with 1% growth in the merchant solutions segment and a 2% drop in the financial solutions segment.
“While there remains significant work ahead of us, we are clear on our strategy, laser focused on our priorities and are optimistic about our multi-quarter path,” Lyons told investors during an earnings call.
The results follow Fiserv’s earnings from last October, which saw the company cut its full-year earnings outlook and announce some strategic changes in response to customer complaints about fees charged for Fiserv’s point-of-sale system, Clover. The resulting plunge in share prices erased around $30 billion in Fiserv’s market capitalization.
During Tuesday’s call, Chief Financial Officer Paul Todd noted that volume growth for Clover initially fell below expectations.
This was “driven largely by softness we experienced in the month of November in the U.S. particularly in the restaurant and retail sectors,” Todd said. However, he added that this softness was consistent with industry-wide trends and that spending picked up again in December and January to growth of around 11%.
The company is also addressing concerns from its banking clients by modernizing its “core” ledger technology. Lyons emphasized that—based on client feedback—there would be “no forced upgrades or conversions” for financial institutions.
On the digital payments front, management said it was pleased with sequential improvement but also growth in terms of network volumes.
“Just like with all the segments, we do have comparative headwinds that will continue in digital payments for the first half of next year, but there wouldn’t be anything else I would add on the network side,” Lyons said.