FIS posts lower profit on weaker consumer spending volumes

By Thomson Reuters Feb 26, 2024 | 7:58 AM

(Reuters) – Banking and payments conglomerate Fidelity National Information Services posted a 3% fall in its fourth-quarter adjusted profit on Monday, hurt by lower consumer spending volumes, sending its shares down by 2.7%.

As interest rates remain high, consumers are scaling back on discretionary spending, hitting payment processors like FIS, which charge a fee for processing transactions.

The company’s adjusted net income from continuing operations, which includes businesses other than the Worldpay merchant solutions business, fell 5% to $558 million for the quarter ended Dec. 31.

Last month, FIS completed the sale of a 55% stake in Worldpay, its merchant service business, to private equity firm GTCR. It had signed the deal last year valuing Worldpay at $18.50 billion.

Revenue from the banking solutions business, which offers core processing and transaction processing software to financial institutions remained almost flat at $1.69 billion.

In a bright spot, FIS forecast 2024 adjusted profit in the range of $4.66 to $4.76, above Wall Street expectations of $4.46, according to LSEG data.

The Worldpay merchant solutions business, reported as “discontinued operations”, saw a 2% jump in revenue to $1.2 billion.

(Reporting by Pritam Biswas in Bengaluru; Editing by Vijay Kishore)