Fidelity National Information Services Inc. (FIS) saw its shares plunge dramatically during afternoon trading, marking the most significant drop since March 2023. The sharp decline came as the company reported quarterly revenue of $2.6 billion, falling short of analysts' expectations of $2.63 billion. Despite this, the company's net income surged nearly fivefold to $304 million, or 56 cents per share, from $62 million, or 10 cents per share, in the same period last year.
FIS's financial report highlighted a mixed bag of results. While the company's revenue increased by 3.5% from the previous year's $2.51 billion, it attributed the growth to a "tough prior year comparison." Analysts had anticipated first-quarter revenue of $2.56 billion and an annual revenue of $10.6 billion, but FIS forecasted revenue between $2.49 billion and $2.51 billion for the current quarter and $10.44 billion to $10.5 billion for the year. On a positive note, FIS exceeded earnings per share expectations with an adjusted EPS of $1.40, surpassing the anticipated $1.36.
In an effort to boost shareholder value, FIS increased its share repurchase goal from $800 million to $1.2 billion. The company announced new sales of digital solutions rose 70% year-over-year in 2024, signaling a robust demand in its digital segment.
Furthermore, FIS unveiled a strategic partnership with online lender Affirm to offer a debit service to its banking clients. This initiative will enable banks to introduce their version of the Affirm Card without customers having to adopt a new piece of plastic, broadening FIS's service offerings.
Despite missing its growth estimates for 2024 due to some one-time items, CEO Stephanie Ferris expressed confidence in the company's trajectory.
"Due to some one-time items," said Stephanie Ferris, CEO of FIS.
Ferris emphasized the importance of strengthening client relations and the promising potential for further acceleration in 2025.
"Growth in new sales," she noted, "leave us confident in further acceleration in 2025."