Fiserv at JPMorgan Conference: Strategic Growth Amid Challenges

On Thursday, 15 May 2025, Fiserv Inc. (NYSE:FI) addressed investors at the 53rd Annual JPMorgan Global Technology, Media and Communications Conference. The discussion, led by CFO Bob Howe, provided a strategic overview of Fiserv’s recent performance, highlighting both growth and challenges. While the company reaffirmed its revenue targets, concerns were raised over the slower growth in Clover volume, attributed to technical adjustments and market conditions.

Key Takeaways

• Clover’s Q1 growth slowed to 8%, influenced by a gateway conversion and leap year effects.
• Fiserv maintains its revenue target of $3.5 billion for Clover by year-end.
• Heavy investment continues in new product development, with CapEx at $1.4-$1.5 billion annually.
• The CEO transition to Mike Lyons is reported as smooth and well-prepared.
• International expansion and new product launches are key focuses for future growth.

Financial Results

Fiserv’s financial results revealed a mixed performance in Q1:

• Clover revenue grew by 27%, driven by volume, hardware sales, and value-added services.
• Value-added services penetration increased to 24% in Q1, with a year-end target of 25%.
• The Financial Solutions segment grew by 6%, hitting the lower end of the target range.
• Capital expenditures have been consistent, with projections of $1.4-$1.5 billion annually.

Operational Updates

Operationally, Fiserv is expanding and innovating:

• Clover’s international footprint grew with the addition of four new countries.
• The integration of ADP’s run solution into Clover was completed in May.
• Cash Flow Central launched its first client, with 53 more in the pipeline.
• Key implementations are underway, including partnerships with Target and Verizon.

Future Outlook

Looking ahead, Fiserv remains optimistic:

• The company reaffirmed its full-year organic growth outlook of 10%-12%.
• EPS growth is projected at 15%-17%, with expectations of a stronger second half.
• International expansion, particularly in Brazil, is a significant growth driver.
• Cash Flow Central is seen as a potential major contributor, with a $2 billion market opportunity.

Q&A Highlights

During the Q&A session, several key points were addressed:

• Clarifications were made regarding the Clover volume slowdown and its causes.
• The importance of hardware sales and value-added services in revenue growth was emphasized.
• The Canadian market experienced a temporary slowdown but has since recovered.
• Opportunities from the Capital One Discover transaction were discussed.

In conclusion, Fiserv’s conference call provided a comprehensive view of its current position and future strategies. For a detailed understanding, readers are encouraged to refer to the full transcript below.

Full transcript - 53rd Annual JPMorgan Global Technology, Media and Communications Conference:

Tien Tsin Huang, Analyst, JPM: Okay. Thanks everyone for joining. My name is Tien Tsin Huang. I cover payments and IT service here at JPM. This is the Fiserv discussion.

I know there’s a lot of talk about with Fiserv, a fun name to to cover. So with us from Fiserv, we’ve got Bob Howe, the the CFO. Julie’s here also in the in in the audience. But thank you both for being here, Bob? Absolutely.

Glad to be here. Thanks for I know you’ve been really busy with a lot of things going on, but I figured we’d just start, just given the harsh stock reaction to the first quarter, give you an opportunity to address that? What might be understood? What’s been the learning from that in terms of the questions you’ve been receiving?

Bob Howe, CFO, Fiserv: Yeah, so maybe obvious, but I’ll state the obvious. Certainly disappointed with the reaction, unexpected. And what we have learned through this is there is a intense focus on clover volume. So over and over and over again as we’ve talked to investors since that earnings call, it comes back to what’s going on with Clover volume. They get the revenue, they get the rest of the company, but what’s happening there?

And so lots of conversations about kind of all the puts and takes in that number and specifically, as I suspect most of you know, we reported an 8% Clover volume growth, which is slower than what we reported last year. Lots of conversation about the sequential move of that fourth quarter of last year, we reported 14%. And so when you look at it sequentially, it looks like a six point drop. And there were a couple of things that we talked about on the earnings call and extensively since. And two very specific things.

One is last year, particularly in the first quarter of last year, we had a gateway conversion. So we had a gateway that was non Clover clients that we converted over to the Clover gateway. And so we saw a pickup of volume from that last year that doesn’t repeat this year. And so that was about two points of headwind against the growth rate. So eight kind of becomes 10.

The other item we talked about is obviously Q1 last year we had leap year, one day out of ninety one days last year, ninety days this year. That’s a little more than a point of growth. So eight becomes 10 becomes 11. And then we had a couple of other items we talked about the timing of Easter was Q1 of last year, Q2 of this year, March to April. We did see some slowing of Canada, which is our largest international market in first quarter.

Fast forward to today, right now and I don’t give quarterly guidance period, let alone on one key performance indicator around Clover, but given the lots of discussion and questions around it, we expect second quarter to be generally similar to first quarter in terms of the reported growth rate from a volume standpoint. We do see that gateway headwind actually increasing a bit in the second quarter. Okay. And that’s a dynamic of during first quarter, we’ve been converting that gateway for about a year, actually about two quarters heading into first quarter, got a big chunk in first quarter and then a little bit more in second and third quarter, but it was ramping through the first quarter. So Q2 is when you have the full quarter impact of what was going on in Q1.

And then we expect that to subside going forward excuse me, Q3 and Q4. A couple of important points that we’re trying to make sure people understand is number one, we reported 27% growth in Clover revenue with that 8% volume And volume certainly important, it is an element of the growth hardware value added services are also key growth drivers or key drivers of that revenue growth. And we saw good hardware sales in the second quarter, which actually followed very good hardware sales in the fourth quarter and we saw very good value added service penetration, went from 22 in the fourth quarter to 24% in the first quarter of this year. And we continue to see opportunities to sell to see additional revenue from all three of those elements volume, hardware, value added services. So we remain confident in delivering on the 3,500,000,000 of revenue by the end of the year.

First quarter was in line with our expectations, 27% in the quarter gets us in the right path to deliver on that $3,500,000,000 and what we see in terms of international expansion. We added four new countries in the first quarter. We announced that we will be launching actually on Saturday, this coming Saturday, new Clover Hospitality which is a solution targeted for high end restaurants and to broad continued expansion of value added services and the Clover solution gives us confidence of delivering $3,500,000,000 this year and of course $4,500,000,000 is the target that we laid out for 2026 and on path for that.

Tien Tsin Huang, Analyst, JPM: Great. So we’re done then, right? Connor, we’re done. All right. So, that’s great.

I’m glad you went through all of that. I know there’s a lot of detail in there and it’s crazy how it attracts so much attention, but that’s the learning from it.

Bob Howe, CFO, Fiserv: Well, yeah, absolutely. And obviously Clover is a key growth driver the company and it’s part of our small business ecosystem, our integrated solution that we’re selling, it’s a key element of it. We’re quite excited of that being an important element. We’ve got the new partnership with ADP that’s going incredibly well. That is actually now as of the May, we have ADP’s run solution integrated into Clover.

We’ve been cross selling that so to speak, providing each other referrals, but now that’s actually integrated in. Another solution that’s coming actually came to market formally, We launched our first client on Cash Flow Central in the first quarter. We’ve got 53 more clients to ramp onto that already in backlog and obviously continue to sell more, again part of that small business integrated suite that leads with Clover, can lead with Cash Flow Central, it’s got ADP in it, it’s got XD which is our digital banking solution, so we’re quite excited about the opportunity ahead.

Tien Tsin Huang, Analyst, JPM: I mean, Bob, we’ve been talking about a lot of different themes and growth drivers over the years, right? And it does feel like, just within this Clover and SMB piece, that this list of things you’re going through is longer than you is that fair? I know it’s hard to get into the detail on the stage, but is it reasonable to say that product launches, geography, expansion, the distribution deal with ADP, I mean, is quite a bit in front of you.

Bob Howe, CFO, Fiserv: Well, absolutely. And I’ve been the CFO at Fiserv for just over nine years now and I was telling group earlier unbelievable number of new products within Clover, within the small business suite, in merchant, in financial solutions, all of them investments we’ve been making over the last several years coming to market. And one of the things that I was quite pleased with and excited for as we went through the first quarter, there were a number of key milestones that had to happen in order for us to continue to drive additional growth. When we originally provided guidance for the full year 2025 back in February, ’1 of the things I talked about in that February earnings call is we don’t give quarterly guidance, but I felt it was important to not only give you our full year outlook, which was 10% to 12% organic growth for the company, but lay out a little bit of the cadence. Because we have so many new products, new opportunities for growth, we talked about we plan we expect the first quarter to start out a little bit slower and that we will ramp into that particularly in the second half.

And so important for me inside the company to say, okay, I’ve now laid that out. Am I on track for cash flow central? When I said that in February, it’s a great product, product was available, it was in production, but it was not yet in production with a client, no revenue yet. And so I’m telling everybody, no, no, it’s coming. We’re good.

Well, we did it. We now have our first. Now it’s only our first, but it’s our first client live. We gotta get ADP integrated into Clover. Wasn’t done at the earnings call.

Took us an extra week, which was by the way the plan, first week of May. And so we keep clicking across all of those individual milestones. And one of the, I think, secret sauces to Fiserv is I don’t have a product or two products that have to be a home run. I got lots of different opportunities and I expect all of them to hit and I expect all of them to hit on time at the ramp that I expect, but unfortunately that’s not reality. So some things come a little bit faster, some things come a little bit slower, but I don’t have the $500,000,000 product that if something goes bump, whether client isn’t ready to implement or we’re a little bit slow or whatever the dynamic is, we’ve got lots of different opportunities.

And as I said earlier, we had a number of very important milestones come across in Q1. We’ve got more that will happen in Q2, but have a good degree of confidence that we’ll continue to deliver along that long laundry list. And if you rewind, in 2020 as a proxy, spent $900,000,000 on CapEx. A lot of that is new product development technology spend. In 2021, that went up to about $1,400,000,000 1 point 5 billion dollars and we’ve held at that level 2022, ’20 ’20 ’3, ’20 ’20 ’4 expect to be at that ’25.

So that increased spending manifests itself in all of these new products and capabilities that we’re now seeing today.

Tien Tsin Huang, Analyst, JPM: Got it. Hey, you know, from from learning, you know, we should have listened harder on the the slower start to the year comment and but also not used to seeing a long list of of of things as well. You know, we did hear from ADP and Maria did talk about that’s live and Mhmm. They’re excited about it. So that that fits on that side.

So, yeah, we’ll we’ll we’ll see how it plays out. One more, I don’t wanna spend all the time on this, but I’ve heard you say also before that Fiserv can solve for volume if you want it to, right? But instead you’re trying to build up this quality book and through different sources. Is that did I hear that correctly?

Bob Howe, CFO, Fiserv: Yeah. As you might suspect, there’s been a lot of soul searching internally on my part to understand why it was such a surprise. Again, we delivered on what we expected and I actually as we are entering the earnings call, I went back and pulled out the last quarter script and reread, okay, what did I say and I was clear on cadence. I was not clear on cadence within merchant. It was a broad statement because it was true in both segments and I certainly wasn’t clear on clover volume.

Clover volume is important, no doubt about it and clearly from an investor standpoint, it’s an important part of value creation, but it is one of the drivers of growth and I need volume, no doubt about it. But I am focused on getting volume through signing up more merchants, which then allows us to sell hardware and sell value added services. That is the Clover recipe. It is a software and hardware solution that enables payments and enables a small business to better operate. We’ve had this discussion since around, well, why did that slow so much?

Again, if you go through all the puts and takes,

Tien Tsin Huang, Analyst, JPM: which I

Bob Howe, CFO, Fiserv: should have been clear on in the earnings call, we did decel from fourth quarter to first quarter. But I think if you look at a lot of our peers, we’re in line with the kind of 2% to four percent two to four points slowdown from Q4 to Q1. So we’re in line with our expectation. We could get lots more volume. I could discount the heck out of my hardware.

We could flood the market. I could get a lot of micro merchants, but it wouldn’t be value added volume. It would be volume for volume’s sake. And I have scaled volume between our Clover device, which is very well received in the marketplace and widespread. I also have large enterprise, I have large processing clients.

And so we have very scaled volume, so I don’t need volume for the sake of volume. And so we are focused on, yes, getting volume, but getting the volume that can add value to the company long term.

Tien Tsin Huang, Analyst, JPM: Okay. Good. Thanks for going through that. So zooming out a little bit, thinking about, of course, let’s hope you hit on all these list of things that are coming through, but what about the the the spend side of it? You know, we’ve generally heard about things being stable, but how cyclical is that business, right, whether it be from the consumer side, the SMB side, or enterprise front?

How much flex can there be in order for you to hit your targets? What do you see on the ground?

Bob Howe, CFO, Fiserv: Yeah, I think a few important points here. Number one, from a merchant standpoint, we’ve got a very diverse client base. If you look at the spending, the volume, the activity that we have inside of merchant, we’re roughly fifty-fifty split between discretionary spending and non discretionary spending. So yes, we have a big restaurant business, but we’re also very deep in groceries. So in a difficult economic time, people go out less.

And you actually tend to see a trade down. I don’t go to the high end restaurant as much. I might go to a quick service or mid market, whatever, or I go all the way down to grocery. I can capture that business across the board, and so there’s a natural hedge or benefit from that standpoint. If you look at Clover specifically, it’s a little bit more sixtyforty, a little bit more discretionary and that’s the strength of the restaurant business, but again, very broad capability to withstand a slowdown in the consumer.

An interesting element, particularly in the small business space, because I am volume based, a little bit of inflation is actually a good thing for me. It’s got to be a little bit. If it’s too much, obviously that has a macro impact, but a slightly faster inflation will give me slightly more revenue. And again, we think we can weather a storm quite well if there is one. From what we’re seeing today, consumer continues to hold steady.

If you saw our Fiserv Small Business Index that we released, I guess, couple of weeks ago now for the month of April, it’s an index that we use that gives an indication of what’s going on across small business in The United States. It is based on our data, but it is not our results. It’s what we’re seeing if you apply all of that very wide set of data across The U. S. Marketplace.

We saw about three points of growth year over year. That’s slower than what we saw in March, a little bit slower than what we saw for the full quarter first quarter, but still good spending levels. If you listen to the news shows, the financial news stores shows in the morning, which I unfortunately do when I travel. When I’m at home, don’t tend to watch those, so I get a little bit more depressed when I travel these days. There’s a lot of doom and gloom.

The word recession has crept back in. Now this week, that’s a little bit lower risk or lower probability than it was last week, But all of that is more prognostication and we’re not seeing it right now. I would tell you though because of that discretionary and nondiscretionary split and because of the way we operate the company, we can manage through downturns. And 2025 if we deliver on the 15% to 17% EPS growth this year, this will be our fortieth consecutive year of double digit earnings growth. There’s some really tough economic times in that forty years, so I think we’ve demonstrated the ability to weather the storm.

Tien Tsin Huang, Analyst, JPM: That’s the hallmark of Pfizer? That’s right. Okay, so we talked about the volume stuff, we talked about the execution against the list, we talked about consumer spending, let’s do competition and what’s happening around We’ve heard from a bunch of companies, Square said they’re back and they’re going to be more competitive. I’m sure you feel the questions on that. You also have Global Payments and Worldpay too, very scaled processors coming together perhaps driving some distraction that could create opportunity for Fiserv.

What do you see there competitively? Anything that changes your thinking around competitiveness or where you might want to lean harder or maybe be a little bit more careful?

Bob Howe, CFO, Fiserv: Yeah, you know, this is an extremely competitive market and has been for forever. Nobody came to us and said two years ago, well Square stumbled, you guys must be really doing well. Square may have stumbled, but you never count them out. I’m not going to bet against Jack. I’m going to compete with them.

And we’re going to continue to invest in new products and new hardware. Last year, we launched five new pieces of hardware or upgraded hardware and we launched a slew of new software capabilities focused not only on our specific verticals, restaurant, retail and services, but also on vertical capability. We’ll form partnerships like we did with ADP. We have a tremendous distribution channel and we continue to maximize that opportunity. I think it is unmatched in the marketplace.

Others are trying to compete in that space. It’s not easy to do. It’s certainly not easy to manage. It’s also not easy to create. And so, yes, we’ll have competitors ebb and flow and some will have a resurgence or a doubling down or an increased investment and some of that will work.

There’s still lots of share in the market. For someone else to win doesn’t mean I lose. I think we continue to do quite well in a share standpoint across the board, and I think there’s still massive opportunities. We believe we’re the partner of choice. We think that’s why Maria decided to join forces with us, with the leading solution with Clover.

Our bank channel, a thousand banks have chosen to sign up with us to help us distribute Clover and our merchant solutions. We have a tremendous ISO partnership. We have a quite honestly still relatively new and growing direct channel. And ISV is still early stages and we see tremendous opportunity. So we’re 100% not standing still and we’ll compete head to head with anybody.

Tien Tsin Huang, Analyst, JPM: Okay. One more on Clover. You you are entering five countries. Mhmm. You know, Brazil is one that’s very ripe Mhmm.

Probably is the word I choose to to penetrate with Clover. You know, you are working with banks. It’s very bank centric in terms of distribution. How big could these countries or quickly could these countries ramp? I know you’re not completely new to Brazil, but Clover is new.

Yeah. But it does feel like as the take rates are healthy, you can drive anticipation of revenue there as well. I don’t wanna underestimate or oversell it, but how quickly could that ramp?

Bob Howe, CFO, Fiserv: Yeah. You asked two very important and distinct questions. One is how big could it be, and two, how fast. None of these suddenly explode and again it’s part of the I think the secret sauce and the success recipe for Fiserv. Brazil will add good growth for us and think is gonna be a tremendous capability for us over time.

And same with Australia, same with Mexico, same with Singapore, the four of the five countries all launched in some fashion in the first quarter. And I say in some fashion, we’ll go to Brazil, for example. We had the official launch back in December, early December. Mhmm. That was that official launch was the party.

Come to market, invite our clients, invite our existing small business clients, non Clover clients, invite our partners, bring the press out and formally launch it. Then we then spent the next ninety days, the whole of first quarter, training those bank partners. What is Clover? How do you sell Clover? What’s the value recipe, etcetera?

And then formally launched at the end of the first quarter. And we’ll see I’ve got a curve that shows the number of merchants, the volume from those merchants and the revenue and we’re clicking off, but it’s a curve that meaningfully accelerates. And we think it’s a great opportunity for us. We have been in Brazil for a lot of years and in fact all four of those countries, we have meaningful presence both from a merchant standpoint as well as from a financial solution standpoint. We’re well known in the market.

We have established partnerships in Brazil. We have both Casa and Secrete, tremendous reach, tens of thousands of branches that will now be selling Clover and that’s kind of the secret recipe. The fifth one, you mentioned five, was is Belgium. Now we’re entering Belgium through the acquisition of CCV that we announced in first quarter. They have a good presence in Belgium that will allow us to bring Clover into that space.

So we’re entering markets new to Clover, but not new to us. We think that gives us a real opportunity not only to move with some pace, but also really have a strong success.

Tien Tsin Huang, Analyst, JPM: Okay. Let me ask one more and then we’ll open it up. On the financial side, the first quarter grew 6%, lower end of your 6% to 8% target. Can you build up what would it take to accelerate growth there? But more importantly, just to ask them all together for the benefit of time, just timely implementation seems like it’s really, really important to get these deals up and running.

And we’ve heard from some of the IT services and BPO companies that there’s been some signs of delays, and there are is a lot of activity in general. So how dependent is your outlook on timely implementations and are you seeing them tracking on schedule?

Bob Howe, CFO, Fiserv: Yeah. So if you look across the financial solutions segment, many of the products and solutions we sell are long cycle time. Long cycle time to sign the contract. And then can be if you’re thinking of a core account processing solution or a credit issuing solution can be twelve to eighteen months. And it’s dependent upon a significant amount of data transmission and implementation and it’s reliant upon what we do but also what the client does.

And so it is paced by the client’s pace and how quickly they want to implement. Some cases, it’s we’ve got an agreement with our former supplier and so that one finishes on x date and so we’re not going to we don’t need to be ready until then, but man, we better be ready So it’s one of those where, it’s eighteen months out, got our time and all of a sudden you’re eighteen months later, it’s we better hurry. I’ve heard the same story about slowdown, but I’ve heard that from outside the company and we’re not seeing that in our space. We’ve got a number of large implementations along backlog of things that we are currently working on.

We have not seen a slowing pace of that in our organization yet. Beginning of excuse me, in early March we went live with Target, a large credit issuing client that we announced I think twenty four months ago when they finally went live. We’ve got Verizon on the horizon for later this year, second half of the year. Actually beyond that is Desjardins, a large credit union consortium up in Canada. I can’t remember the firing order offhand, but we announced Desjardins about the same time we announced Target.

Target is now live. Desjardins is a year, maybe a little less than that, but give or take a year out. That’s not our timing. That’s when they are prepared to go live. But that was scheduled that way at contract signing essentially.

So we continue to see the opportunities to implement on the issuer side, implement on the core account processing side. When you get into some of the digital payments cycle, it’s much faster and we feel good about the opportunity. We’re at the bottom end of the range. Our guidance for this year is 6% to 8%. That’s up a point from our guidance last year for 5% to 7%.

We did 6% last year. We did 6% in the first quarter. We feel good about being six to eight this year.

Tien Tsin Huang, Analyst, JPM: Good. Questions? Happy to take questions, if any. We have the mic here. Anyone?

Yep. Pat in back. If you don’t mind using the mic here.

Pat Burton, Analyst, Winslow Capital: Pat Burton, Winslow Capital. Thank you. The question about generally similar volume growth for Clover in the second quarter, is that comparing to the 8%

Bob Howe, CFO, Fiserv: adjustment number you gave us that got us up to about 12? Thanks. Yes. So my generally similar is against the reported 8%. And then I think I said, I hope I said that the headwind that we saw in Q1, which was about two points from the gateway conversion, will grow slightly in second quarter and then diminish in the third and fourth quarter.

And that’s just driven by the number of merchants that were converted last year. Another important point that I probably didn’t mention is we talked about these adjustments to the volume. We didn’t talk about them from a revenue standpoint. There’s not a lot of revenue implication. So 27% revenue, we continue to expect that to accelerate to deliver the 3.5%.

But the volume comment was similar from a reported standpoint. There’ll be slightly bigger headwind from the gateway conversion in Q2 and then ease. At the end of the day, we think we need kind of low double digit volume growth to deliver on that $3,500,000,000 And if you take the reported number in Q1, you take what I just said about Q2 on a pro form a basis it’s low double digits and so we’re right in line with what we need for the full year.

Tien Tsin Huang, Analyst, JPM: Thank you, Pat. Anyone else? So maybe building on that, know people submitted this question to me a lot then, since you answered it that way. That spread between the low double digit volume and then getting to the top line growth, what’s the can you bridge the difference in the spread between those two?

Bob Howe, CFO, Fiserv: Yeah. So the spread, the 8% versus 27%, it’s really driven by two large items for the most part. It’s hardware sales and it’s value added services. Value added services continues to grow quite nicely for us. We closed out fourth quarter of twenty twenty three at 19%, grew to 22% by the fourth quarter of last year.

We did 25 excuse me, 24% in the first quarter. Our guidance for the year at that $3,500,000,000 is 25% value added service. We continue to see good growth, good opportunity in that value added service. And as the total revenue number grows as a percent of that revenue that’s growing. So there’s a meaningful growth rate in that value added services.

And then from a hardware standpoint, we talked a lot about this really during the earnings call and subsequent. We had quite a bit of hardware sales in the fourth quarter and the first quarter and what we’re seeing around some of our bank partners and some of our ISOs seeing the power of that hardware, the new hardware that we’re putting into the market and they see the opportunity to sell that into the market. That’s actually a kind of a leading indicator for us that hardware becomes software, becomes value added service, it becomes volume for us. And these guys are not they’re not buying hardware to put it in a storeroom, to put it in a warehouse. I’ve joked about this.

I hope they’re tripping over it every day and reminding themselves they’ve got it and they’re selling it. So we see that as sell through opportunity going forward, and it’s also an indication of their confidence in the ability to sell Clover.

Tien Tsin Huang, Analyst, JPM: Yeah. No, we’ve seen the kiosk a lot. So it’s definitely in the field. Any last questions on Clover before I keep going? Yes, Mina.

Mina, Unidentified speaker: I just quickly wanted to ask about Canada, which you’d mentioned was weak in 4Q. Is that also driving some of the flat volume in 2Q or have you seen some improvement there?

Bob Howe, CFO, Fiserv: So we did talk briefly during Q1 about Canada. We did see a slowing in Canada. As I mentioned, that’s our largest international market. We actually have seen that rebound. One of the hypotheses that I laid out back in three, four weeks ago was that we felt that could be a temporary thing.

Obviously, there’s a lot of discussions going on between the two countries and I think there was a bit of a reaction of, you know, I’ve got my nice winter home down in Florida, I’m not going there. And things have calmed down a little bit, perhaps I’ve decided I really miss my winter home down in Florida, I’m going to go. And so we’ve seen a pickup if you look at the April results for Canada, it’s essentially come back to where it was. Now that wasn’t a huge driver, but it was an element and it was one that we were paying attention to is that an early indication of a softening macro environment and we saw it rebound back to kind of more normal levels in April.

Tien Tsin Huang, Analyst, JPM: Anyone else? So we did a piece on Cash Flow Central, Bob, sort of doing a deep dive on Cash Flow Central with the inspiration being, hey, could that be the next Clover kind of thing? And, I think you disclosed a $2,000,000,000 medium term TAM for for Cash Flow Central just by selling it into your existing base. I’m curious if your thoughts have changed on that now that you have some clients live. I think you mentioned 54 mandates since the launch.

Has your excitement or enthusiasm about Cash Flow Central changed at all here since you guys gave that $2,000,000,000

Bob Howe, CFO, Fiserv: Yes. When we launched, we were quite enthusiastic about the opportunity. And I would say, it’s probably grown from there. It continues to be as we’ve been going through the development, is meeting our expectations. When you lay this out, this is what I think we’re going to be able to do.

Can we really do it? And yes, we’ve been able to do that. I feel great that it’s finally in the first bank. That has actually created a bit of a race, so to speak, for the other 53. In a lot of cases, don’t want to be first, and so we now have the first one live, so we think there’s an opportunity to step quickly through the other 53, as well as a number of banks who may have been sitting on the sidelines.

Okay, that sounds really interesting. I’d really love to see it. You can do a demo, but it’s a demo. And now that it’s live, think some renewed interest or accelerated interest in that. From a $2,000,000,000 that’s a TAM, it’s not our outlook ourselves, but we do think it’s a quite meaningful opportunity.

There’s been lots and lots and lots of attempts to really simplify cash flow management, treasury management for small businesses and we think we’ve got a great partnership with Meliel that brings that not only to the Clover system, but also to the bank channel. So there’s a broad distribution capability. We are integrating it directly into XD, which is a digital banking solution. We’re integrating it into Clover, and so there’s a variety of different mechanisms small business can use it. And it’s the goal is to make it easier for a small business operator to operate their business.

It’s what Clover’s all about. Clover, yes, is a point of sale device, but we love to talk about it as an operating system. This is one more element of that operating system. And if we can make it easy for a small business that doesn’t have a treasury department to operate their business and if we can bring that capability to the bank client partner who wants the deep relationship with those small businesses. You know, there are many very large banks that have a tremendous treasury management system if you’re a large corporate.

But to take that down to a small it’s just too heavy. They they number one, they can’t pay for it, and number two, it’s too heavy to operate. They don’t have a treasury organization, and so this is custom built for a small business. It gives them great cash management. We’ve got a lot of banks that are very excited to be able to sell that into their small business client.

It enables us to help a small excuse me, help a financial institution generate revenue, quite helpful. It helps them deepen their relationship. In a lot of cases, they are also our Clover partners, and so there’s a lot of additional opportunity. It makes us a more important partner for those financial institutions. It also makes us a more important partner for those small businesses.

So that at the end of the day, I love making pizza. I want to make pizza and the hassle of operating and figuring out cash management and figuring out how to schedule my wait staff and that sort of a thing. You got an operating system that makes it easy and allows you to make your pies.

Tien Tsin Huang, Analyst, JPM: Good. No, we’re excited about it. You know, that’s why we put a little effort into researching it. I think there’s a lot of opportunity. We’re almost out of time.

I had two more questions I wanted to sneak in. I don’t know if we can do them both. Was gonna ask about Star Excel, especially in the wake of Capital One Discover. It feels like there’s an opportunity there on the on the debit network side. I don’t know if you can answer that in ten seconds.

But I thought it was important to ask you just your early impressions with, you know, CEO, my clients coming in. You know, I’ve known Michael a long time. Early impressions, but more fun question maybe. What are gonna miss the most about Frank?

Bob Howe, CFO, Fiserv: Yeah. So I’ll try to knock out both. From from Capital One Discover and our Star Excel, there are three large transactions took place in the last ninety days. A lot of people are talking about global TSYS, FIS, Worldpay, but there’s really a third one that matters to us. And we think that’s positive opportunity for us.

And so we’re actually looking deep at opportunities across the board. We operate the third largest debit network in The United States and it’s a close second. So our goal is to make that number two and good. I think there’s some real opportunity. Good.

On the second part of your question, you know, I’ve worked for Frank for six years now. I happen to be one of the few people on the management committee that didn’t know Mike before he joined. But I tell folks, I I feel like I knew Mike when Frank called me up right before we made the announcement and said, hey, the board selected a CEO. His name is Mike Lyons. And he started to explain to him to me who he was.

I said, Frank, I I know Mike. He saw it. Didn’t realize you knew him. I said, well, I don’t, but I’ve heard all of you guys talk about him because he’s been a large client of ours. So he walked in the door knowing probably half of the management team quite well, and the other half he’s gotten to know quite quickly.

I spent a lot of time with him as you might suspect. Really enjoy working with him. I think he’s a great add to the organization. The transition has been incredibly smooth. It went very quickly from Frank’s announcement in December to Mike joining at the January to having a ninety day transition period.

Frank officially left last Tuesday. I still talk to him. True. You know, three texts this morning on a variety of other things. You know, you build a relationship with a guy for a lot of years.

I’m not gonna miss the 04:30AM text messages. And I think the the transition has enabled very, very smooth movement. On Tuesday, when Frank officially left, it was a bit of a yawn. It’s like, okay, good. You know, not not good he’s gone, but okay, well, on to the next where we’ve been operating.

It went from Frank with Mike in the background in the January to Frank and Mike side by side to Mike and then getting back to Frank and it’s been an incredibly smooth transition. My hats off to the board for moving quickly. My hats off to Frank for enabling a very strong transition and Mike has jumped in. He knows the company. If he were here, he’d tell you, P and C he ran 92 different pieces of software from Fiserv.

He knows the company quite well and it’s made for a great transition.

Tien Tsin Huang, Analyst, JPM: Yeah. That was great. Thanks for the time. Please say hi to Frank for me. I will do that.

Bob, thank you for the time as always. Great.

Bob Howe, CFO, Fiserv: Thank you

Tien Tsin Huang, Analyst, JPM: very much.

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