Global Payments (GPN) 7 Aug 24 2024 Q2 Earnings call transcript

In its recent earnings call, Global Payments reported a 6% adjusted net revenue growth and an adjusted earnings per share growth of 12% for the second quarter of 2024. This solid performance was driven by the company's strategic focus on being the worldwide partner of choice for commerce solutions.

Strong Execution and Strategic Acquisitions

One of the key highlights of the call was the company's expansion of adjusted operating margins by 40 basis points, underscoring its ongoing efforts to drive efficiency in its business. The acquisition of EVO Payments has been instrumental in this improvement, with synergy benefits being realized and the integration process well underway.

Merchant Solutions on the Rise

The Merchant Solutions segment saw high single-digit organic growth, primarily driven by the company's differentiated capabilities in embedded payments and commerce enablement solutions. The integration business achieved double-digit growth, with new ISV partner signings up 30% year-to-date, and active merchants on the ProFac solution increasing by 40%.

Expansion into B2B and New Markets

Global Payments also reported strong growth in its B2B acceptance solutions, leveraging the PayFabric platform acquired with EVO. The company's strategic expansion into new markets, such as Germany and the U.K., is expected to yield significant opportunities, with plans to launch its point-of-sale offering in Germany and bring its point-of-sale software to key international markets.

Looking Ahead

For the second half of 2024, Global Payments expects reported adjusted net revenue to range from $9.17 billion to $9.30 billion, reflecting growth of 6% to 7% over 2023. The company anticipates adjusting its operating margin to expand by up to 50 basis points, driven by the benefits of its technology enablement strategy and the integration of EVO.

Investing in the Future

Global Payments remains committed to simplifying its business and investing in innovation to maintain its competitive edge. The company is finalizing a strategic review aimed at sharpening its focus on high-potential markets and simplifying its portfolio. These initiatives are expected to unlock value and improve returns for shareholders.

Investor Conference

The company is holding an investor conference on September 24, 2024, in New York City, where it plans to share more details about its strategic initiatives and future outlook. Investors and analysts alike are eagerly anticipating this event to gain a deeper understanding of Global Payments' growth prospects and strategic direction.

Overall, Global Payments' strong performance in the second quarter, coupled with its strategic initiatives and future outlook, underscore its position as a leading player in the global payments technology industry. Despite macroeconomic uncertainties, the company remains optimistic about its future growth prospects and is well-positioned to capitalize on emerging opportunities.