Why Is Fidelity National (FIS) Down 3% Since Last Earnings Report?

It has been about a month since the last earnings report for Fidelity National Information Services (FIS). Shares have lost about 3% in that time frame, outperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Fidelity National due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.

Fidelity National Q4 Earnings Miss Estimates on Increasing Expenses

Fidelity National Information Services reported fourth-quarter 2025 adjusted earnings per share (EPS) of $1.68, which missed the Zacks Consensus Estimate by 0.7%. The bottom line advanced 20% year over year.

Revenues amounted to $2.8 billion, which improved 8.2% year over year. The top line beat the consensus mark by 2.6%.

The quarterly earnings were affected by the rising cost of revenues and higher selling, general and administrative expenses. The downside was partially offset by strong performances in the Banking Solutions and Capital Market Solutions segments, supported by robust recurring revenues.

FIS’ Q4 Performance

The cost of revenues increased 7% year over year to $1.7 billion in the quarter under review. SG&A expenses of $549 million rose 13.7% year over year. Net interest expenses of $88 million increased 31.3% from the prior-year quarter’s figure.

Adjusted EBITDA was $1.2 billion, which rose 7% year over year. Adjusted EBITDA margin contracted 36 basis points (bps) to 42.5% compared to the prior-year period, mainly due to higher corporate expenses.

Full-Year Update of FIS

Adjusted 2025 EPS improved 6.7% from a year ago to $5.57. Total revenues rose 5.4% to $10.7 billion. Adjusted EBITDA improved 4.7% year over year to $4.3 billion.

Q4 Segmental Update of Fidelity National

Revenues from the Banking Solutions unit totaled $1.9 billion, which grew 9% year over year. The metric surpassed the Zacks Consensus Estimate by 2.2%. The segment’s results were aided by higher recurring revenues. Adjusted EBITDA margin improved 132 bps year over year to 43.9%, supported by cost management and a favorable revenue mix.

The Capital Market Solutions segment’s revenues advanced 8% year over year to $883 million, beating the Zacks Consensus Estimate by 1%. Strong recurring revenue growth benefited the metric. Adjusted EBITDA margin of 57.4% improved 227 bps year over year.

The Corporate and Other segment recorded revenues of $63 million in the quarter under review, which increased 3% year over year. Adjusted EBITDA loss was $130 million.

Financial Update (As of Dec. 31, 2025)

Fidelity National exited 2025 with cash and cash equivalents of $599 million, which decreased from $834 million at 2024-end. Total assets of $33.5 billion declined from $33.8 billion at the end of 2024.

Long-term debt, excluding the current portion, amounted to $9.1 billion, down from $9.7 billion as of Dec. 31, 2024. The current portion of long-term debt totaled $1.3 billion. Short-term borrowings totaled $2.7 billion at the end of 2025.

Total equity of $13.9 billion dropped from $15.7 billion at the end of 2024.

Fidelity National Financial generated $2.6 billion in net cash from operations, representing a 19.9% year-over-year increase. Adjusted free cash flow totaled $2.2 billion, up 18% year over year.

Share Repurchase & Dividend Update

Fidelity National Information Services bought back $291 million of shares in Q4 2025. For the full year, the company returned $2.1 billion to shareholders through $1.3 billion in buybacks and $847 million in dividends.

On Jan. 29, 2026, the board raised the quarterly dividend by 10% to 44 cents per share.

1Q26 View

Management forecasts revenues between $3.27 billion and $3.29 billion. Adjusted EBITDA is projected to be in the range of $1,275-$1,290 million. Adjusted EPS is estimated to be between $1.26 and $1.30.

FIS’ 2026 Guidance

Revenues are expected to be in the range of $13.77-$13.85 billion for 2026, indicating 30-31% adjusted revenue growth.

Adjusted EBITDA is projected to be between $5.8 billion and $5.86 billion in 2026, up from $4.3 billion in 2025. Adjusted EBITDA margin is anticipated to be in the range of 42.1-42.3%.

Adjusted EPS is expected to be between $6.22 and $6.32, which implies significant growth from $5.57 in 2025.

Free Cash Flow is projected to be between $2.05 billion and $2.15 billion.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended downward during the past month.

The consensus estimate has shifted -7.65% due to these changes.

VGM Scores

At this time, Fidelity National has a average Growth Score of C, a grade with the same score on the momentum front. However, the stock has a grade of A on the value side, putting it in the top 20% for value investors.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Fidelity National has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Fidelity National belongs to the Zacks Financial Transaction Services industry. Another stock from the same industry, Paymentus (PAY), has gained 3.8% over the past month. More than a month has passed since the company reported results for the quarter ended December 2025.

Paymentus reported revenues of $330.46 million in the last reported quarter, representing a year-over-year change of +28.1%. EPS of $0.20 for the same period compares with $0.13 a year ago.

For the current quarter, Paymentus is expected to post earnings of $0.17 per share, indicating a change of +21.4% from the year-ago quarter. The Zacks Consensus Estimate has changed -7.1% over the last 30 days.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Paymentus. Also, the stock has a VGM Score of B.

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Fidelity National Information Services, Inc. (FIS): Free Stock Analysis Report

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This article originally published on Zacks Investment Research (zacks.com).

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