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Fiserv (FISV) Q1 FY26 earnings call: guidance and Q&A

Earnings call· Mar 2026 (Q1 FY26)· Information Technology· May 5, 2026

Source: earnings call transcript

Executive summary

Fiserv Q1 FY26 — Clover and Finxact Drive Growth Amidst Strategic Investments

Fiserv is executing its "One Fiserv" action plan, focusing on strategic investments and operational improvements to drive long-term growth, despite current financial results reflecting a transition year with nonrecurring revenue headwinds and increased expenses. The company is confident in its strategy and expects improved operating performance to be visible in financial results in the second half of 2026 and 2027.

Highlights

5

  • Clover GPV grew over 9% on a reported basis, and 12% excluding the gateway conversion.

  • Clover Value-Added Services (VAS) revenue grew 18% year-over-year, contributing 27% of total Clover revenue.

  • Finxact accounts and positions were up over 70% in Q1.

  • Client inquiry resolution time decreased by 27% year-on-year.

  • High-impact client incidents were down nearly 60% year-on-year.

Concerns

5

  • Total company adjusted revenue decreased 2.4% to $4.68 billion.

  • Total company organic revenue was down 3.6% in Q1.

  • Merchant Solutions adjusted operating income declined 23% to $626 million.

  • Financial Solutions adjusted operating income declined 24% to $877 million.

  • Core bank account and revenue attrition remain above the long-term trend.

Guidance & targets

CategoryTargetConfidence
2026 Organic Revenue Growth
1% to 3%
high materiality
High
2026 Adjusted Revenue Growth
1% to 3%
high materiality
High
2026 Merchant Solutions Revenue Growth
mid-single digits
medium materiality
High
2026 Financial Solutions Revenue Growth
flat to slightly down
medium materiality
High
Q2 FY26 Financial Solutions Revenue Decline
high end of mid-single digits
medium materiality
High
2026 Adjusted EPS
$8 to $8.30
high materiality
High
2026 Adjusted Operating Margin
approximately 34%
high materiality
High
H1 FY26 Adjusted Operating Margin
approximately 31% to 32%
medium materiality
High
H2 FY26 Adjusted Operating Margin
35% to 36%
medium materiality
High
2026 Capital Expenditures
approximately flat with 2025 levels
medium materiality
High
2026 Free Cash Flow Conversion
approximately 90% of adjusted net income
medium materiality
High
2026 Clover Revenue Growth
low double-digits
medium materiality
High
2026 Clover GPV Growth (ex-Gateway conversion)
10% to 15%
medium materiality
High
Full Year Adjusted Tax Rate
19% to 19.5%
medium materiality
High
Debt to Adjusted EBITDA Ratio
approximately 3x
medium materiality
High

Segment performance

SegmentRevenueYoYQoQMargin
Merchant Solutions
Segment performance was largely in line with expectations, fully anniversarying the CCV transaction. Lower inflation and interest rates in Argentina negatively impacted adjusted revenue. Clover revenue growth was impacted by higher nonrecurring revenue in Q1 2025, but underlying growth was stronger. Small Business volume remained solid.
Organic revenue growth: -1%Adjusted revenue growth: flatAdjusted operating margin: 26.4%Small Business organic revenue decline: 1%Small Business adjusted revenue growth: 1%Small Business volume growth: 7%Clover revenue growth: 6%Clover revenue growth (ex-nonrecurring): mid-teensClover Payment Processing revenue growth: 10%Clover volume growth (reported): >9%Clover volume growth (ex-gateway conversion): 12%Clover Value-Added Services (VAS) revenue contribution: 27% of Clover revenueClover Value-Added Services (VAS) revenue growth: 18%Enterprise organic revenue growth: 3%Enterprise adjusted revenue growth: 2%Enterprise transactions growth: 8%Processing organic revenue decline: 14%Processing adjusted revenue decline: 9%
———$626 million
Financial Solutions
Segment performance was impacted by nonrecurring revenue comparables and lingering effects from prior client service challenges. Underlying account and volume growth was in line with expectations, particularly in Finxact and Payments (excluding BillPay). Adjusted operating margin decreased significantly year-over-year.
Organic revenue decline: 6%Adjusted revenue decline: 5%Adjusted operating margin: 38.1% (vs 47.5% prior year)Digital Payments organic revenue decline: 5%Digital Payments adjusted revenue decline: 5%Debit processing growth: low single-digitsDebit network volume growth: low double-digitsZelle transactions growth: 18%BillPay transactions decline: high single-digitsIssuing organic revenue decline: 6%Issuing adjusted revenue decline: 5%Global accounts on file growth: low single-digitsBanking organic revenue decline: 6%Banking adjusted revenue decline: 4%Core counts decline: 2%Overall accounts and positions (incl. Finxact) growth: 6%Finxact accounts and positions growth: >70%
———$877 million

Product announcements

ProductTypeDetails
PracticePaylaunch
Professional Services offeringlaunch
Clover Savingslaunch
Stablecoin pilotlaunch
CommerceHub omnichannel capabilitymilestone
Developer portallaunch
AI initiatives for client portal and call centerslaunch
Governed AI operating layerroadmap

Deals & partnerships

Western Alliance Bank Largest agent bank partnership in Fiserv's history, expanding reach with merchants across the Western U.S.

Western Alliance Bank has more than $90 billion in assets.

OceanFirst Bank Extended Premier core and surrounds agreement, adding Digital Payments and committing to deploy CoreAdvance.

OceanFirst Bank is a $14.5 billion Northeast regional bank growing through acquisition of Flushing Bank.

Nicolet National Bank Adopting Premier Core with its Midwest One acquisition.

Nicolet National Bank is a $16 billion Wisconsin-based bank.

Truliant Federal Credit Union Chose to move to Fiserv's debit processing platform.

Truliant Federal Credit Union is a $5 billion-plus North Carolina-based institution.

PNC Bank Expanded long-standing digital money movement relationship to include CashFlow Central AR/AP Services for their small businesses.

PNC Bank is a large financial institution.

Large payroll provider Embedded Finance Win to bring new capabilities to their payroll members.

Leverages new integrated capabilities across Fiserv, including Finxact for ledger, PayFair for banking applications and program management, and VisionNext as a cardholder platform.

Large retailer Embedded Finance Win to bring new capabilities to their customers.

Leverages new integrated capabilities across Fiserv, including Finxact for ledger, PayFair for banking applications and program management, and VisionNext as a cardholder platform.

StoneCastle Acquisition supporting clients' depository needs and enabling Clover Savings.

Integration with StoneCastle is enabling the launch of Clover Savings.

Smith Consulting Acquisition to drive value-added services to depository partners.

Enhances Fiserv's approach to embracing the consultant community.

TD Merchant Solutions Enable TD Merchant Solutions to provide Clover's product offering, processing, and servicing to its clients.

Part of international momentum for Clover in Canada.

Rectangle Partnered in developing Clover PracticePay.

Collaboration for the new healthcare vertical.

Risks & headwinds

Lower inflation and interest rates in Argentina Q1 FY26

revenue headwind to Merchant in Q1

Mitigation:Largely offset by lower interest expense below the line.

Impact of higher gas prices from Middle East conflict

potential impact on the mix of consumer spending

Mitigation:Monitoring the dynamic, as seen in Fiserv Small Business Index data.

Lapping higher mix of nonrecurring revenue Q1 FY26, expected to continue into Q2 FY26

fueling lingering impacts from prior client service challenges and absorbing incremental expense from investments

Mitigation:Strategic investments and operational improvements are expected to drive long-term client-focused growth, with improved operating performance visible in H2 2026 and 2027.

Core bank account and revenue attrition Q1 FY26

remain above our long-term trend

Mitigation:Increased client-facing personnel, improved client inquiry resolution, reduced high-impact incidents, AI initiatives for client portal/call centers, decision to support all cores, StoneCastle acquisition, Smith Consulting acquisition, Client Health Index for proactive engagement.

What to watch in Q2 FY26

Financial Solutions Revenue Decline

Q2 FY26
Current 5% decline in Q1 FY26
Target decline at the high end of mid-single digits

Why it matters

Q2 is expected to be the trough for year-on-year revenue decline, indicating a potential inflection point for the segment's performance.

As we told you in February, we expect the second quarter to be the trough in terms of our year-on-year revenue decline and we expect our Financial Solutions business to decline at the high end of mid-single digits in Q2.

Find out whether FISV delivers this. Inve re-checks your case every morning.

Q&A highlights

Can you provide more detail on attrition and retention trends in the Banking segment, given the ongoing bank conversions and previous client service challenges?

Management acknowledged core attrition is above target due to past actions but stated they are bending the curve positively through increased client coverage, AI-enhanced service, and supporting all core platforms. They cited StoneCastle acquisition value-add and a Client Health Index for proactive engagement.

“core attrition [ has been above ] where we want it to be and getting that back to normal is a significant focus for us. That attrition, as you know, is the result of actions taken over the last several years and especially around the client service front.”

asked by Tien-Tsin Huang · answered by Michael Lyons

2 min read 5 chapters

Detailed narrative

One Fiserv Action Plan Progress

Fiserv is actively executing its "One Fiserv" action plan, focusing on client-first initiatives, establishing Clover as a preeminent small business operating platform, driving innovation, and implementing Project Elevate. The company has seen progress in client service metrics and is making targeted investments, including new leadership hires, to enhance execution and drive long-term growth. Management expects improved operating performance to become more visible in financial results in the second half of 2026 and 2027.

Client-First Initiatives and Service Improvement

Under its client-first pillar, Fiserv has significantly increased client-facing personnel, meeting a key client demand. This has led to a 27% year-on-year reduction in time to resolve client inquiries and a nearly 60% decrease in high-impact client incidents. The company also launched AI initiatives to enhance its primary client portal and call centers in Financial Solutions, receiving positive feedback on its decision to continue supporting all core banking platforms.

Clover Platform Expansion and International Momentum

Clover continues its momentum, launching two new verticals in March: PracticePay for healthcare and a Professional Services offering. Early results for PracticePay show annualized GPV per healthcare outlet running at double-digit levels above existing Clover healthcare merchants. Internationally, Brazil Clover outlets were up over 30% sequentially, and the company remains on track to enable TD Merchant Solutions to offer Clover products in Canada in H2. Clover Savings, a merchant cash management program, is on track to launch before the end of Q2.

Innovation and AI Integration

Fiserv is hitting critical milestones on strategic products like Experience Digital, CashFlow Central, Vision Next, Optis, and CommerceHub, with the latter seeing nearly 200% transaction growth in Q1. The company is ramping up AI tooling in software development, showing significant reductions in new feature development and delivery time. A stablecoin pilot to facilitate interbank money movement is slated for launch this summer, and a new governed AI operating layer for financial institutions will be introduced at Investor Day.

Project Elevate and Efficiency Drives

Project Elevate, an AI-centric program, is identifying hundreds of opportunities for revenue uplift, expense reduction, and productivity improvements. Beyond Elevate, Fiserv took actions in Q1 to drive efficiency, including closing two subscale offices, exiting underperforming Merchant businesses in India, reducing management layers, and migrating customer activities from a significant data center. These efforts are part of a broader strategy to transform the company and enhance shareholder value.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.