GLOBAL PAYMENTS INC Q1 FY2025 earnings call

Cameron Bready started by highlighting a solid first quarter with over 5% constant currency adjusted net revenue growth, 70 basis points of adjusted operating margin expansion, and 11% constant currency adjusted EPS growth. The company is aggressively executing its transformation agenda, including simplifying the organizational structure, unifying the Merchant business globally, and advancing technology harmonization. Bob Cortopassi discussed Worldpay's progress, revenue synergy opportunities, and integration approach. Josh Whipple provided financial performance highlights for Q1, including adjusted net revenue, margin expansion, and EPS growth, and outlined 2025 guidance regarding adjusted net revenue growth, margin expansion, and capital allocation.

Merchant Solutions achieved adjusted net revenue of $1.69 billion for the first quarter, with 6% constant currency growth excluding dispositions. The disposition of AdvancedMD and exit of certain non-core markets in Asia Pacific had approximately 4-point impact on reported growth. Issuer Solutions' adjusted revenues were $529 million, an increase of 3% on a constant currency basis. Merchant Solutions delivered an adjusted operating margin of 47.8%, an increase of 80 basis points. Issuer Solutions delivered an adjusted operating margin of 46.3%, a decrease of 50 basis points.

Global Payments reaffirms 2025 guidance: constant currency adjusted net revenue growth of 5% to 6% excluding dispositions, adjusted operating margin expansion of approximately 50 basis points, adjusted EPS growth of 10% to 11% on a constant currency basis. Post-transaction, expects pro forma adjusted net revenue of $12.5 billion and adjusted EBITDA of $6.5 billion, with at least $600 million in cost synergies and $200 million in revenue synergies, accelerating growth in 2026 and 2027 with margin expansion of 100-200 basis points.

Q: On the standalone business, can you talk about the rollout plan of the Genius product in terms of pull versus push and managing back book attrition risk?

A: Cameron Bready said short-term focus is on front book, with long-term plan to work back book. Bob Cortopassi added that it's pull-based initially, with back book migration at customer's pace and little reason for attrition.

Q: Can you clarify if the improved revenue growth at Worldpay over the past year has been all organic and share buyback assumptions?

A: Cameron Bready said Worldpay's growth is organic. Josh Whipple mentioned expecting over $2 billion in share repo in 2026 and over $3 billion in 2027.

Q: How important is the acquired orchestration layer in minimizing client disruption?

A: Cameron Bready said it's critical for easy client access to products and consolidated reporting. Bob Cortopassi added it accelerates delivery of products and capabilities across platforms.

Q: Are there still more dispositions to go in Asia subscale geographies?

A: Cameron Bready said there's still some to go, targeting $500-600 million in revenue dispositions over the next couple of years.

Q: Update on Genius platform rebrand, sales force reorg, and revenue growth components?

A: Cameron Bready discussed rebrand progress. Bob Cortopassi talked about completed sales force alignment and ongoing compensation and capability work. Josh Whipple highlighted revenue growth from organic volume and stable same store sales.

Q: How can Global Payments handle recessionary pressures as a pure-play merchant business?

A: Cameron Bready said the business is well-diversified geographically and vertically, positioned to navigate macro environments, with Worldpay's durable business segments adding resilience.

Q: SMB volume held up well, can you describe dynamics?

A: Cameron Bready said SMB volume trends were stable, with international pockets showing strength, and progress on transformation driving better outcomes.

Q: Investment in Genius product and future changes?

A: Cameron Bready and Bob Cortopassi discussed heavy investment in POS capabilities, harmonizing investment into singular platforms, and pro forma business having increased investment capacity for innovation.

Q: How does the transaction manage product across SMB and enterprise and drive innovation?

A: Cameron Bready discussed trends like convergence of enterprise and SMB capabilities, growth of digital-native commerce, and evolution of embedded commerce models. Bob Cortopassi talked about centralized product management and localized product capabilities to drive innovation.

Q: Macro question on back half performance and sensitivity?

A: Josh Whipple said the consumer remains resilient, and the outlook assumes stable macro spending trends through the balance of the year