Global Payments Inc. Q4 FY2025 earnings call

Cameron Bready mentioned successful completion of Worldpay acquisition and divestiture of Issuer Solutions business. Highlighted strong financial results for Q4 and full year 2025. Progressed transformation program including transitioning to unified operating model, modernizing technology stack, investing in AI-enabled tools, successful rollout of Genius. In 2026, focus on integrating Worldpay, accelerating go-to-market strategy, rapidly expanding Genius, leveraging AI. Go-to-market strategy organized around enterprise, integrated and platforms, SMB channels. Genius has substantial growth opportunities with various initiatives. AI is leveraged across agentic commerce, embedding in products, driving productivity and operational efficiency.

For the fourth quarter, Global Payments reported 6% constant currency adjusted net revenue growth, excluding dispositions, 80 basis points of adjusted operating margin expansion and 12% adjusted EPS growth. Merchant Solutions business had adjusted net revenue growth accelerating to slightly above 6%. For the full year, adjusted net revenue was $9.32 billion, up 6% on constant currency basis excluding dispositions. Adjusted operating margin improved 100 basis points to 44.2%. Adjusted earnings per share was $12.22, up 12%. Merchant Solutions segment achieved adjusted net revenue of $1.78 billion in Q4 with growth of slightly over 6% on constant currency basis, excluding dispositions. Integrated Embedded business grew in high single digits in Q4. Core payments showed mid-single-digit growth in Q4. Merchant Solutions delivered adjusted operating margin of 49.2% in Q4, up 120 basis points from prior year period. Cash flow was strong with adjusted free cash flow of $891 million in Q4 and over 100% conversion rate for full year 2025. Balance sheet was healthy with 2.9x leverage in Q4.

2026 outlook: constant currency adjusted net revenue growth of approximately 5% excluding dispositions. Expected adjusted operating margin expansion of approximately 150 basis points. Net interest expense expected to be approximately $850 million, adjusted effective tax rate approximately 15.5%. Capital expenditures expected to be approximately $1 billion in 2026. Expect adjusted earnings per share of $13.80 to $14 in 2026, representing growth of approximately 13% to 15% over 2025. Plan to return more than $2 billion to shareholders through share repurchases and dividends including $550 million accelerated share repurchase. Aim to delever back to 3x net leverage target by end of 2027.

Q: Dave Koning at Baird asked about split between enterprise and SMB and between Worldpay and Global.

A: Josh Whipple said guide is 5% constant currency ex disposition, merchant business exited year over 6% organically, Worldpay exited year ~4%, first half of 2026 expected to be modestly below 5%, second half expected to accelerate. SMB is ~50% of revenue composition, enterprise and platforms and integrated are ~25% each.

Q: Darrin Peller at Wolfe asked about trajectory of synergies and cross-sell into SMB.

A: Josh Whipple said expect $600 million in cost synergies over 3 years, 2026 expects $70 million to $80 million. Cameron Bready said there are opportunities to cross-sell into SMB using Worldpay distribution channels and expand Genius into those channels.

Q: Dan Dolev at Mizuho asked about staying public vs alternatives.

A: Cameron Bready said focused on integrating Worldpay and executing capital return plans, will assess all options to maximize value for shareholders.

Q: Ramsey El-Assal at Cantor Fitzgerald asked about sales force expansion.

A: Bob Cortopassi said most expansion focused on North America, sales of combined Genius payments and value-added service offerings, stacking resources against relationship sales activities to expand Genius adoption.

Q: Adam Frisch at Evercore asked about Genius and Toast renewal.

A: Cameron Bready said renewed with Toast on multiyear deal, Robert Cortopassi said POS signed annual revenue per deal up nearly 50% year-over-year.

Q: Tien-Tsin Huang at JPMorgan asked about revenue growth algorithm.

A: Cameron Bready said commercial activities and new revenue growth from go-to-market activities will be primary driver of growth, will give more color on individual channels in first quarter.

Q: Andrew Schmidt at KeyBanc asked about Worldpay growth expertise.

A: Cameron Bready said Worldpay's normalized growth in 2025 was as underwrote, continuing to see good progress, enterprise e-comm capabilities are best-in-class, blend of different business segments for combined growth.

Q: Dominic Ball at Redburn asked about Genius back book migration.

A: Robert Cortopassi said focus on front book opportunities, responding to customers, making migration seamless. Cameron Bready said goal is to make back book migration as seamless as possible.

Q: Jeffrey Cantwell at Seaport asked about Genius value-added services and app store.

A: Robert Cortopassi said Genius has suite of value-added services including embedded finance, client loyalty, etc., and approach to app store is curating holistic experience.

Q: Jeffrey Cantwell at Seaport asked again about Genius value-added services and app store.

A: Robert Cortopassi elaborated on value-added services by vertical and broad stack, and approach to app store.

Q: Jason Kupferberg at Wells Fargo asked about free cash flow targets and conservatism in top line outlook.

A: Joshua Whipple said expect $4 billion in levered free cash flow in 2027 and $5 billion in 2028, onetime costs expected to come down. Cameron Bready said prudent approach to 2026 outlook to get started right with businesses, medium-term outlook remains same.