Worldpay's Q1 2025 Earnings Call: Contradictions in Revenue Growth, ACV, and Cost Synergies

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Revenue and Recurring Revenue Growth:
- FIS experienced adjusted revenue growth of 4% in Q1 2025, exceeding expectations, with recurring revenue growth accelerating to 4% from 2% last quarter.
- This growth was driven by focused commercial excellence, strategic acquisitions like the global payments issuer business, and strong retention rates across the enterprise.

Strong Financial Performance and Cash Conversion:
- FIS delivered adjusted EPS growth of 11% to $1.21, at the high end of their outlook, and free cash flow conversion exceeded 70%.
- The strong financial performance was attributed to effective working capital initiatives and successful implementation of client projects.

Proactive Portfolio Management:
- The company sold its 45% stake in Worldpay for $6.6 billion and announced plans to acquire the Issuer Solutions business for $12 billion.
- These transactions aim to strengthen FIS's financial position, enhance the value proposition to clients, and expand cross-selling opportunities, particularly with large banks and corporates.

Capital Markets and Banking Segment Performance:
- Capital markets segment revenue grew by 9% with strong license and renewal activity, while the banking segment grew by 2%.
- Growth in capital markets was driven by outsized license renewals and favorable operating leverage, while banking growth is supported by high retention rates and scheduled commercial excellence initiatives.