Thursday, Fidelity National Information Services, Inc. (FIS) slipped to a loss in the fourth quarter, compared to a profit in the year ago on higher expenses and a significant impairment charge.
Fidelity National acquired Metavante Technologies, Inc. in October and sold its ClearPar automated syndicated loan trade settlement business this January. Excluding income from discontinued operations, the company's loss from continuing operations was $53.1 million, compared to a profit from continuing operations of $49.8 million in the year-ago period.
Results for the year include acquisition related after-tax costs totaling $82.2 million or $0.22 per share, after-tax write-down charges of $87.6 million or $0.23 per share. The combined charges, along with purchase price amortization on intangible assets acquired through various acquisitions, resulted in a loss from continuing operations attributable to common stockholders of $54.2 million or $0.14 per share.
Net loss attributable to Fidelity National Information was $53.9 million, compared to a net income of $28.8 million in the year-ago period.
Adjusted net earnings from continuing operations totaled $167.0 million or $0.44 per share. Non-GAAP earnings per share decreased to $0.44, compared to $0.47 last year.
On an average, 17 analysts polled by Thomson Reuters expected earnings of $0.43 for the quarter. Analysts' estimates typically exclude one-time items.
In comparison, FIS competitor Fiserv, Inc. (FISV) reported a fourth-quarter profit that increased to $118 million or $0.76 from $62 million or $0.39 last year on revenues that increased 2% revenue to $1.06 billion.
FIS processing and services revenue increased to $1.30 billion from $858.0 million in the year-ago period. Excluding the negative impact of $15 million to deferred revenue, adjusted revenue increased 2.7% to $1.316 billion, compared to pro-forma revenue of $1.281 billion in the year-ago quarter. Excluding a $29.3 million favorable foreign currency impact, consolidated revenue increased 0.4%.
Segment-wise, Financial Solutions revenue declined 1.3% to $452.5 million from the prior year due to increases in global commercial services revenue and software sales, offset by a reduction in professional services revenue.
Payment Solutions revenue declined 1.0% to $629.6 million compared to $635.9 million as growth in debit and network solutions was offset by reduced termination fees and lower item processing, prepaid card and retail check activity.
International Solutions revenue increased 24.0% to $232.3 million, compared to $187.3 million in the prior year quarter. Core processing revenue increased 6.4% driven by increased software sales and strong services revenue, while payments revenue increased 9.7% driven by organic account growth across all regions.
For the full year, FIS reported net earnings from continuing operations attributable to common stockholders of $101.3 million or $0.42 per share on an increase in consolidated revenues to $3.770 billion from $3.427 billion.
For the full year, pro-forma adjusted revenue decreased 0.8% to $5.052 billion, compared to pro-forma revenue of $5.092 billion last year.
Analysts expected the company to post earnings of $1.63 per share on revenue of $3.79 billion for the year.
FIS President and CEO Frank Martire said, "We are reaffirming our outlook for 17% to 23% growth in adjusted earnings per share in 2010, combined with strong margin expansion and increased cash flow."
For the full year, Fidelity National expects adjusted earnings of $1.91 to $2.01 on a year-over-year revenue growth of 2% to 4%. Analysts expect the company to post full-year EPS of $1.97 on revenues of $5.20 billion.
FIS closed Thursday's regular trading at $23.54, down $0.45 or 1.88%, on a volume of 4.25 million shares on the NYSE.
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