Global Payments Q4 2024 Earnings Report

Global Payments EPS Results

• Actual EPS: $2.84
• Consensus EPS: $2.98
• Beat/Miss: Missed by -$0.14
• One Year Ago EPS: N/A

Global Payments Revenue Results

• Actual Revenue: $2.29 billion
• Expected Revenue: $2.31 billion
• Beat/Miss: Missed by -$18.80 million
• YoY Revenue Growth: N/A

Global Payments Announcement Details

• Quarter: Q4 2024
• Date: 2/13/2025
• Time: Before Market Opens
• Conference Call Date: Thursday, February 13, 2025
• Conference Call Time: 8:00AM ET

Global Payments (NYSE:GPN) provides payment technology and software solutions for card, check, and digital-based payments in the Americas, Europe, and the Asia-Pacific. It operates through two segments, Merchant Solutions and Issuer Solutions. The Merchant Solutions segment offers authorization, settlement and funding, customer support, chargeback resolution, terminal rental, sales and deployment, payment security, and consolidated billing and reporting services. This segment also provides an array of enterprise software solutions that streamline business operations of its customers in various vertical markets; and value-added solutions and services, such as point-of-sale software, analytics and customer engagement, payroll and reporting, and human capital management. The Issuer Solutions segment offers solutions that enable financial institutions and retailers to manage their card portfolios through a platform; and commercial payments, account payables, and electronic payment alternatives solutions for businesses and governments. It markets its products and services through direct sales force, trade associations, agent and enterprise software providers, referral arrangements with value-added resellers, and independent sales organizations. The company was founded in 1967 and is headquartered in Atlanta, Georgia.

Global Payments Q4 2024 Earnings Call Transcript

Presentation

[Operator]

Ladies and gentlemen, thank you for standing by, and welcome to Global Payments Fourth Quarter and Full Year twenty twenty four Earnings Conference Call. At this time, all participants are in a listen only mode. Later, we will open the lines for questions and answers. And as a reminder, today's conference will be recorded. At this time, I'd like to turn the conference over to your host, Senior Vice President, Investor Relations, Winnie Smith.

[Operator]

Please go ahead.

[Winnie Smith, SVP, IR at Global Payments]

Good morning, and welcome to Global Payments' fourth quarter and full year twenty twenty four conference call. Our earnings release and the slides that accompany this call can be found on the Investor Relations area of our website at www.globalpayments.com. Before we begin, I'd like to remind you that some of the comments made by management during today's conference call contain forward looking statements about, among other matters, expected operating and financial results. These statements are subject to risks, uncertainties and other factors, including the impact of economic conditions on our future operations that could cause actual actual results to differ materially from expectations. Certain risk factors inherent in our business are set forth in filings with the SEC, including our most recent 10 K and subsequent filings.

[Winnie Smith, SVP, IR at Global Payments]

We caution you not to place undue reliance on these statements. Forward looking statements during this call speak only as of the date of this call, and we undertake no obligation to update them. We will also be referring to several non GAAP financial measures, which we believe are more reflective of our ongoing performance. For a full reconciliation of the non GAAP financial measures discussed in this call to the most comparable GAAP measures in accordance with SEC regulations, please see our press release furnished as an exhibit to our Form eight K filed this morning and our supplemental material available on the Investor Relations section of our website. Joining me on the call is our CEO, Cameron Brady our President and COO, Bob Cortopassi and our CFO, Josh Whipple.

[Winnie Smith, SVP, IR at Global Payments]

Now, I'll turn the call over to Cameron.

[Cameron Bready, Director & CEO at Global Payments]

Thanks, Winnie, and good morning, everyone. Thank you for joining us today. We are proud of all that we accomplished in 2024. It was a pivotal year for Global Payments as we launched our broad transformation agenda to set the future course for our business, while also delivering strong operational and financial performance. We started our transformation journey by reimagining our mission, vision and values to provide the organization with a clear view of our priorities and desired culture, setting the foundation for us to pursue our ambition to be the worldwide partner of choice for commerce solutions.

[Cameron Bready, Director & CEO at Global Payments]

We then refreshed our strategy to focus our efforts and investments in the area of the business that will drive the most attractive opportunities for growth and where we are best positioned to compete and win. From there, we undertook a holistic review of our business to determine how to best position the organization to execute against our refocused strategy and deliver sustainable performance. We use the first principles approach to examining growth drivers, market positioning, go to market capabilities, product portfolios and the potential to optimize our assets. This review led to a realignment of our operating model and business structure as well as the operational transformation program that we described at our investor conference in September. We are continuing to execute against a significant number of initiatives that will create meaningful benefits and provide us with incremental capacity for reinvestment to drive growth and quite simply run a better business.

[Cameron Bready, Director & CEO at Global Payments]

While executing on our transformation, we have continued to deliver strong financial performance. For the fourth quarter, we produced 6.5% constant currency growth, excluding dispositions, including over 7% in the merchant business and 3% in our issuer business, an acceleration sequentially from Q3 and consistent with the outlook we provided in October. And for the full year, we delivered 6% adjusted net revenue growth, record adjusted operating margins and double digit adjusted earnings per share growth, consistent with our initial outlook detailed at the beginning of twenty twenty four despite the incremental FX headwinds absorbed. We also generated roughly $3,000,000,000 of adjusted free cash flow and returned 1,800,000,000 to shareholders, including proceeds from the recent divestiture of our AdvancedMD business. Our consistent performance throughout the year highlights the durability of our model and the benefits of our sharpened focus as we execute on our strategic priorities.

[Cameron Bready, Director & CEO at Global Payments]

In our Merchant segment, our POS and Software business continues to deliver strong results. Our POS solutions are robust and are winning in the restaurant and retail verticals as evidenced by the high teens new locations growth we achieved in 2024. Our POS growth benefited from the strong performance of our direct channel in North America, where notably we saw a roughly 25% increase in the annual recurring revenue opportunity with new customers. And we could not be more excited about the significant opportunity ahead as we consolidate our products and platforms under the Genius brand and extend them globally. Notably, we expanded our relationship with one of the largest multinational QSRs in the fourth quarter to include drive through solutions in addition to our existing kitchen management partnership that spans several thousand locations in North America.

[Cameron Bready, Director & CEO at Global Payments]

We also expanded our long standing partnership as the primary technology partner for Whataburger, which now includes cloud POS, kiosks and menu boards. Additionally, we continue to have success in the stadium and events vertical and are excited to have reached an agreement with Kai Tak Sports Park, Hong Kong's new state of the art multipurpose sports and entertainment venue. We also renewed and expanded our POS partnership with a multinational entertainment company to support its major events in The UK and Ireland over a multi year period. Importantly, our relationship will now include our loyalty solutions, enabling reward offers and personalized experiences for event attendees. Other notable new stadium POS relationships achieved in 2024 include the Newcastle, Birmingham City and Nottingham Forest Football Clubs, as well as an expanded partnership with Blackpool, which now includes PayLink solutions, ticketing services, kiosks and QR code ordering in addition to POS and payments.

[Cameron Bready, Director & CEO at Global Payments]

And of course, we executed a new partnership with Diamond Baseball Holdings to serve as the official commerce technology partner for its minor league baseball franchises in The United States and Canada earlier in 2024. We remain on track to be fully rolled out with our solutions in an additional 19 ballparks across Diamond Club's portfolio for a total of 32 before the 2025 season opens in April. In our education business, new sales with university customers increased more than 30% in 2024, including a number of new significant international wins across The UK and Ireland as well as in Canada. We also added 113 new K-twelve school districts this year, a roughly 20% increase from 2023. And with the addition of the Los Angeles Unified School District, we now have relationships with the three largest school districts in The United States.

[Cameron Bready, Director & CEO at Global Payments]

In the real estate vertical, we signed more than 800 new property management customers during the year, while also expanding our partnerships with leading real estate software platform providers like MRI Software, Rent Manager and AppFolio, which will allow us to cross sell additional products and services to their customers. Turning to integrated embedded, new ISV partner signings increased 34% across our integrated payments offerings in 2024 compared to the prior year. Notably, we also added 165 international ISV partnerships across The UK, Asia, Australia and LatAm as we seek to better align our activities and capabilities globally. We also recently expanded our relationship with PayPal to simplify and accelerate the checkout experience by integrating its FastLane solution into our platform, furthering our efforts to deliver embedded commerce solutions. This collaboration extends the payment choices we can offer across The U.

[Cameron Bready, Director & CEO at Global Payments]

S, allowing our customers to enhance their digital experiences for their consumers. Moving to core payments, our focus on forming deeper relationships with commerce enablement and outstanding service is driving significant opportunities with both new and existing partners globally. We continue to make strong progress with Commerce Bank in Germany and have already boarded over 2,000 merchants since the inception of our joint venture midyear. Additionally, we saw double digit growth in other key geographies including Central Europe, Poland and Greece in 2024, as well as in LatAm where we benefit from strong secular payment trends in Mexico. Shifting to Issuer Solutions, we were pleased with our operational execution throughout the year.

[Cameron Bready, Director & CEO at Global Payments]

We successfully completed 17 customer implementations in 2024 and ended the year with record traditional accounts on file of eight eighty five million We continue to have a strong conversion pipeline of more than 70,000,000 accounts that extends well into 2026, as well as an additional six letters of intent with institutions worldwide. In 2024, we completed 17 multi year renewals in new customer partnerships. This includes contracts with KeyBanc, Grinn Financial and Vancity executed in the fourth quarter, in addition to significant agreements with Navy Federal Credit Union, Virgin Money, Citizens, NatWest and several other premier global clients that we announced earlier this year. And over the last few years, we've renewed 15 of our top 20 clients reflecting the strength of our partnerships and providing us good visibility and stability going forward. We also continue to make substantial progress with our technology modernization program.

[Cameron Bready, Director & CEO at Global Payments]

Development of our client facing applications was completed in the fourth quarter consistent with our plan and we remain on track for full commercial launch in 2025. We have more than a dozen pilots in progress with existing customers and are on track to have 33 client pilots in production this year. We recently achieved certification of our cloud authorization platform with Visa and Mastercard. By the end of twenty twenty five, we will be exclusively selling cloud capabilities, paving the way for widespread adoption of these modernized solutions. Across the business, our ambitious transformation agenda will enable us to deliver our rich portfolio capabilities and solutions through all of our channels in a more frictionless way.

[Cameron Bready, Director & CEO at Global Payments]

While still early days, we are already making great progress across three primary focus areas. First, as we discussed at our investor conference, we have identified meaningful opportunities to streamline and simplify the business. In December, we successfully closed on the sale of AdvancedMD we announced last quarter. Further, we are in the process of exiting several small markets in Asia Pacific this quarter, where we are subscale and see limited opportunity for expansion. With these actions, we have exited a little more than $300,000,000 of the $500,000,000 to $600,000,000 of adjusted net revenue we targeted through our portfolio review.

[Cameron Bready, Director & CEO at Global Payments]

We are pleased with how these initiatives position us to better focus on where we are differentiated and have the right to win and are continuing to advance other targeted divestitures and and exits that will further streamline our business. We have also completed other initiatives designed to simplify our business structure. During the fourth quarter, we successfully acquired Kaisha Bank stake in our joint venture with Erste Group. This business has achieved exceptional growth over the past decade and we are excited about the opportunity to capture more of the economics going forward, while simplifying our pan European operations and governance. We also recently reached an agreement to purchase HSBC stake in our joint venture in Mexico.

[Cameron Bready, Director & CEO at Global Payments]

This creates the opportunity to combine our two existing businesses in Mexico, allowing us to harmonize our go to market strategy, drive better scale, amplify investments and increase efficiencies. Second, we are working to fully unlock the growth potential of our best capabilities, while leveraging all of our distribution networks across the globe. To accomplish this, we have reoriented our business under a single unified operating model and have successfully consolidated our technology teams under common leadership, centralized our operating functions and have unified our merchant solutions business into a homogeneous worldwide organization. This better positions us to harmonize our best products and capabilities globally, including aligning our point of sale solutions under a common brand, Genius. We now have completed the full branding work for Genius and will launch our solutions for the restaurant and retail verticals in The U.

[Cameron Bready, Director & CEO at Global Payments]

S. Beginning in the second quarter. Notably, we will go live with our Genius restaurant solutions for small to medium sized customers this May in tandem with the National Restaurant Association conference. Simultaneously, we will also launch our Genius retail solution for SMB businesses. In September, we will extend the retail offering to additional subverticals and introduce the Genius Enterprise Restaurant Solution at the Foodservice Technology Conference, which is attended by more than 100 of the leading QSR and restaurant chains.

[Cameron Bready, Director & CEO at Global Payments]

We will begin rolling out Genius to international markets in the second half of the year, including in Canada, Mexico, The UK, Germany, Austria and The Czech Republic. In early twenty twenty six, we will bring Genius to additional markets, including Ireland and Spain, followed by Romania, Poland and Australia shortly thereafter. We're also making progress converging our technology capabilities across our POS platforms. And by the end of the year, solutions such as online ordering and delivery, accounting applications, marketing and loyalty, service vertical functionality and third party integrations will be ubiquitously available from a common platform across our Genius offerings. Additionally, we're already driving synergies by leveraging a number of common capabilities.

[Cameron Bready, Director & CEO at Global Payments]

This includes aligning our hardware platforms, streamlining invoicing, consolidating support functions and reducing SKUs. As we converge our platforms over time, we have set the roadmap to migrate customers using legacy platforms to Genius with defined upgrade paths that will provide for a seamless transition to a best of breed cloud solution that will delight merchants and their customers, while also providing us with significant cross sell and up sell opportunities. We also intend to fully leverage our distribution channels to extend our Genius POS solutions globally. Our sales teams, dealers and FI and wholesale partners have already had extensive opportunities to preview Genius and the reception has been overwhelmingly positive with significant excitement about the upcoming launch. Another important initiative we are pursuing is our Salesforce of the Future program, which started with our direct sales teams in The U.

[Cameron Bready, Director & CEO at Global Payments]

S. And will extend to international regions later this year. This includes upscaling and retooling our sales organization, aligning incentives to accelerate cross selling, reimagining our marketing and lead generation efforts, enhancing underwriting and onboarding processes, and improving our approach to provisioning and activating new merchants. As part of this, we have already rolled out and modernized and revamped compensation plan in our FI partner channel and to our POS sales organization. We are extending this plan to enablement solutions extends across our business.

[Cameron Bready, Director & CEO at Global Payments]

As one example, in Issuer Solutions, we launched several key strategic partnerships in the fourth quarter, including with Engage People, Blackhawk Network and one of the largest global technology companies that will serve to advance our loyalty platform capabilities through enhanced distribution and extended point accumulation and redemption options. And third, we will leverage our technology leadership to be a more nimble and agile business while increasing our efficiency and effectiveness. As I previously noted, we have consolidated all of our technology organizations and teams under common leadership. Our technology development and operations were fragmented, resulting in duplication of effort and investments, a lack of standardized tools and practices and a somewhat inefficient operating environment. With this change, we're becoming a more nimble and agile organization with a customer and product centric mindset focused on speed and quality of product development.

[Cameron Bready, Director & CEO at Global Payments]

To support these efforts, we recently completed a small transaction to acquire a modern real time processing and orchestration platform. This technology allows us to leverage and distribute products more easily across multiple platforms and geographies seamlessly, increasing our speed to market and accelerating progress towards our target architectural model. It also allows us to eliminate certain third party providers and streamline our technology operating environments globally. We are already leveraging the platform in Central Europe and Germany and will extend this technology architecture across all of our European markets over the next six to twelve months. Across the company, we are also focused on improving cycle times for new product development and enhancing productivity.

[Cameron Bready, Director & CEO at Global Payments]

This evolution includes modernizing developer tools, including GenAI supported software development, as well as standardizing tooling and implementing processes changes to better identify customer needs and accelerate product launches. Early results have already shown double digit productivity improvements and developers leveraging our GenAI Code Assist tool and a nearly 10% reduction in code deployment time utilizing our modernized tool sets. We anticipate beginning to realize the benefits of these efforts in the second half of the year with the majority of process and technology enhancements in place by year end to support our identified priorities. Further, we are continuing to invest in driving differentiation through service. We have multiple programs underway that leverage GenAI to enhance support offerings for customers.

[Cameron Bready, Director & CEO at Global Payments]

This includes an initiative to replace our global support center software solution to modernize call flows, expand omni channel and digital engagements, increase intelligent routing and incorporate AI powered knowledge management. This will allow our support center teams to improve response times and enhance customer experience by better leveraging automation. We expect to have the new platform fully implemented by the fourth quarter of twenty twenty five. Given the early milestones we've achieved and our ongoing progress, we are now expecting our operational transformation initiatives to unlock more than $600,000,000 of annual run rate operating income benefit by the first half of twenty twenty seven. This is an increase from our initial outlook of more than $500,000,000 I could not be more pleased with the performance of our team members, whose passion, ingenuity and relentless pursuit of excellence enabled our success over the last twelve months.

[Cameron Bready, Director & CEO at Global Payments]

As we begin 2025, I remain confident we are doing all the right things to unify and streamline our business, invigorate our go to market activities, leverage our best products and capabilities and amplify our investments to unlock value and position our business for sustainable growth and success. Josh?

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Thanks, Cameron. We are pleased with our financial performance in the fourth quarter and for the full year, which were consistent with our expectations. I'm particularly proud that we delivered these results while simultaneously executing on our transformation agenda. Starting with the full year 2024, we delivered adjusted net revenue of $9,150,000,000 an increase of 6% from the prior year, which includes slightly less than a point headwind from currency and the disposition of AdvancedMD. Adjusted operating margin for the full year improved 40 basis points to 45%.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

The net result was adjusted earnings per share of $11.55 an increase of 11% compared to the full year 2023. For the fourth quarter, we delivered adjusted net revenue of $2,290,000,000 an increase of 5%. On a constant currency basis, excluding dispositions, adjusted net revenue increased approximately 6.5%. Adjusted operating margin for the quarter increased 40 basis points to 45.2%. The net result was adjusted earnings per share of $2.95 an increase of 11% or 12% on a constant currency basis.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Taking a closer look at performance by segment, Merchant Solutions achieved adjusted net revenue of $1,760,000,000 for the fourth quarter, reflecting growth of 6% or more than 7% on a constant currency basis, excluding dispositions. As Cameron noted, we closed our AdvancedMD disposition in December, which is roughly a point of impact in the quarter. This performance represents an acceleration compared to the third quarter, consistent with our expectations, driven by our POS and software and integrated and embedded businesses, both of which achieved high single digit growth during the period. Starting with POS and software, our new cloud POS solution from SMB customers that we launched mid year and are rebranding Genius drove a roughly 35% increase in new POS rooftops in the fourth quarter over the prior year period. This strong demand is being driven by the new software bundles, countertop hardware choices and embedded commerce enablement solutions available through the platform, which includes a leading new feature functionality such as our virtual terminal offering, cash discounting, surcharging solution, pay by text email link capabilities, order ahead and invoicing solutions to name a few.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Turning to the integrated embedded channel, our ISV business added 76 new ISV partners during the fourth quarter with 32 of these wins achieved in international regions. Several of the larger software partners we signed this quarter include BookBuy in the salon vertical, DRX in pharmacy management and ChamberNation, which provides member management, automation and digital media solutions. Our core payments business delivered mid single digit growth for the fourth quarter on a constant currency basis with several international businesses' notable bright spots. Specifically, Central Europe, Poland, Greece and LatAm achieved double digit growth as we continue to benefit from the strong secular payment trends in these markets. We delivered an adjusted operating margin of 48.3% in the merchant segment, an increase of 60 basis points compared to the prior year.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

This performance reflects strong execution on our refocus strategy and ongoing synergy realization from the acquisition of EVO Payments. We've now executed our targeted expense synergies from EVO and are on track to achieve $135,000,000 in annual run rate expense synergies as anticipated. Our Issuer Solutions business produced adjusted net revenue of $542,000,000 for the fourth quarter, reflecting growth of 3% on a constant currency basis, largely driven by a 200 basis point sequential improvement and transaction volumes. This was led by strengthening consumer card transactions, consistent with the trends highlighted by several of our large FI partners this quarter. Commercial card volumes remain largely consistent with the trends that we saw in the third quarter as corporates continue to take a more cautious approach to spending.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Separately, we've seen more of a return to normalcy in terms of product and service investments by bank customers and continue to have a healthy implementation pipeline in 2025. We added a total of 26,000,000 traditional accounts on file this quarter, largely driven by the growth with the existing customers as our strategy of aligning with market share winners continues to drive benefits. And our near record implementation pipeline and the completion of our renewal cycle with many of our large customers gives us confidence in the growth outlook for the business going forward. Moving to our B2B portfolio. The core mid market segment for our AP Automation Solutions continues to generate solid bookings in the quarter, albeit at a slightly moderated pace from earlier in the year due to macro trends.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Additionally, in our PayCard business, we continue to see softer hiring trends in the segments of the market we serve, which again negatively impacted growth this quarter by nearly a point. Finally, Issuer Solutions delivered an adjusted operating margin of 46.9%. This improved sequentially from our third quarter performance, largely driven by better volumes, but represented a modest decline compared to the prior year period as we continue to lap strong margin expansion we realized in this business last year, while also investing in modernization. From a cash flow standpoint, we've reduced strong adjusted free cash flow for the quarter of approximately $814,000,000 representing roughly 110% conversion rate of adjusted net income to adjusted free cash flow. For the full year, adjusted free cash flow was 2,700,000,000 representing a roughly 95% conversion rate of adjusted net income to adjusted free cash flow, consistent with our guidance.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

We invested $184,000,000 in capital expenditures during the quarter and $675,000,000 for the full year, equating to roughly 7% of revenue, which was in line with our guidance.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Our

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

net leverage position decreased to 3.2 times at the end of the fourth quarter and is now consistent with our long term target as forecasted. In connection with the closing of the AdvanceMD transaction in December, we repaid $500,000,000 in senior notes that matured in the quarter and returned $650,000,000 to shareholders through our accelerated share repurchase plan and additional open market purchases. For the full year, we repurchased 12,700,000.0 shares to $1,500,000,000 or roughly 5% of our shares outstanding. Our balance sheet remained extremely healthy and we ended the period with $3,800,000,000 of available liquidity. Our total indebtedness is 100% fixed with a weighted average cost of debt of 3.36 percent.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Turning to the outlook for 2025, we are pleased with how our business is positioned as we execute against our refocus strategy and our expectations are consistent with the medium term outlook we provided at our investor conference in September. Specifically, we currently expect constant currency adjusted net revenue growth of 5% to 6% over 2024, excluding dispositions. We expect dispositions will impact reported adjusted net revenue by over 300 basis points. We are forecasting annual adjusted operating margin to expand approximately 50 basis points for 2025, excluding the effect of dispositions. To provide color at the segment level, we expect our Merchant Inc.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Business to deliver adjusted net revenue growth of roughly 6% on a constant currency basis, excluding dispositions for the full year. We expect roughly 50 basis points of adjusted operating margin expansion for the business excluding dispositions in 2025. Moving to Issuer Solutions. We're anticipating adjusted net revenue growth in roughly 4% range on a constant currency basis for the full year compared to 2024. We anticipate adjusted operating margin for the Issuer business to expand by approximately 50 basis points in 2025.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

In terms of quarterly phasing, we expect modestly higher growth in the second half relative to the first half of the year as our transformation initiatives ramp and as we lap the renewal cycle with many of our large issuer customers and see increased benefits from conversion activity over the course of 2025. Moving to a couple of non operating items. We currently expect net interest expense to be roughly $500,000,000 this year and for our adjusted effective tax rate to be approximately 19%. We're also planning for our capital expenditures to be around $780,000,000 in 2025 or approximately 8% of revenue, which is consistent with the outlook we provided at our investor conference. We anticipate adjusted free cash flow conversion to be greater than 90% for the full year, which again is in line with the expectations we outlined in September.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Regarding capital allocation, we expect to return approximately $2,000,000,000 to shareholders during the year. To that end, we are entering into an accelerated share repurchase plan for $250,000,000 If we execute additional divestitures in 2025, the proceeds will be used to further enhance shareholder returns. We also plan to further reduce our indebtedness during the year. Putting it all together, we expect adjusted earnings per share growth for the full year to be in the range of 10% to 11% on a constant currency basis. We expect adjusted earnings per share growth to be consistent with the quarterly phasing dynamics I detailed in my earlier remarks.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

This 2025 guidance is the same as the outlook we provided at our investor conference in September and reflects the strategic initiatives we are undertaking through our transformation in addition to a stable macro environment. With significant recent strengthening of the U. S. Dollar, we now expect currency to be a headwind of roughly 175 basis points to both adjusted net revenue and adjusted earnings per share. Finally, as you may recall at our investor conference, we mentioned we have been evaluating our reporting structure, including how to treat items like stock based compensation.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Beginning in the first quarter, we will include share based compensation expense and our adjusted results to better align our convention with our peers. We will update our reporting accordingly at that time. However, we do not expect any change to the growth outlook that we provided today. Additionally, we also plan to change the presentation of cash flows for settlement assets and obligations and certain funds held for customers, moving the changes in items from operating to financing cash flows similar to the convention recently adopted by certain of our peers. In summary, we are pleased with the progress we've made since beginning our transformation.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Our focus remains simplifying our operations, strengthening our core businesses and returning capital to shareholders. And we are confident that we have good forward momentum as we execute against our refocused strategy. And with that, I'll turn the call back over to Cameron.

[Cameron Bready, Director & CEO at Global Payments]

Thanks, Josh. We accomplished a great deal over the past year and are very much on track with our ambitious transformation journey. In 2025, we will execute and complete much of our transformation agenda, positioning us to accelerate growth and deliver on the medium term financial goals we established in September. We are changing for the better, playing to our competitive strengths, leveraging what we already have and focusing our energy and investments on the most attractive opportunities where we can differentiate in the strongly believe we are poised to capture and unlock significant value with our renewed strategic focus and clarity. We have an end doable portfolio of assets delivering sustainable organic top line growth in a significant untapped TAM.

[Cameron Bready, Director & CEO at Global Payments]

Our transformation is unleashing an already successful business to deliver all of our solutions to all of our channels in a more frictionless way and drive higher return on invested capital. And we are committed to shareholder value creation targeting returns of $7,500,000,000 over the next three years. We are exactly on track with where we want to be in our transformation and remain as enthusiastic as ever about the future of our business. Whitney?

[Winnie Smith, SVP, IR at Global Payments]

Thanks, Cameron. Before we begin our question and answer session, I'd like to ask everyone to limit their questions to one with one follow-up to accommodate everyone in the queue. Thank you. Operator, we'll now go to questions.

[Operator]

Thank you. Our first question comes from the line of Darren Peller with Wolfe Research. Please proceed with your question.

[Darrin Peller, Managing Director at Wolfe Research, LLC]

Guys, thanks for the help. Just maybe start off with your early evidence of the progress you're seeing on some of the initiatives you're making. I know you touched on the timeline you expect on Genius. That was really helpful. But maybe give us a sense of two things.

[Darrin Peller, Managing Director at Wolfe Research, LLC]

One is the initiatives you see some evidence of working already. I know it's only been about a quarter or so since the Investor Day, but any progress there? And then really more importantly, the cadence we can expect throughout the year, specifically in the merchant growth rate, so we can help understand where we can expect the trajectory, where there's a bottom and then where you start the acceleration?

[Cameron Bready, Director & CEO at Global Payments]

Yes, Darren, good morning. It's Cameron.

[Cameron Bready, Director & CEO at Global Payments]

I'll jump in and start. So it's a great question. Look, I would tell you from my perspective, I'm pretty pleased with some of the early evidence we're seeing in terms of the benefits that our transformation is driving in our business. I'll start with one of the most obvious areas, which is just the level of collaboration we've been able to drive across the organization. Certainly in our merchant business more particularly, we've been able to harmonize and create a more homogeneous operating model for the merchant solution segment.

[Cameron Bready, Director & CEO at Global Payments]

We have teams that are now working together, collaborating together, engaging together to unlock, I think, vast opportunities around products and capabilities that exist in different parts of the business that frankly some of them didn't know that we had or weren't aware we could make available in different markets around the globe. So the level of collaboration and the commercial dialogue that that's driving and some of the opportunities that we've been able to already bring to conclusion as a result of that, I think, albeit small, are very encouraging. The second area is as we continue to harmonize operating environments and technology environments, I think the opportunity we see for operating income benefits is evidenced by the increase in the overall target we provided today is more meaningful probably than we initially anticipated as we started on this transformation journey. So as we work to bring our operating environments together, we're finding far more opportunity for efficiencies and scales and the ability to leverage capabilities across all aspects of our business, merchant and issuer in particular, to drive better outcomes for our clients in terms of the experience they're able to to have and obviously our ability to deliver that in an efficient and effective manner.

[Cameron Bready, Director & CEO at Global Payments]

From a technology perspective, standardizing tools, harmonizing software development life cycles, how we think about product development and collaboration with the business, All of that is yielding what I think will be a more efficient, more effective and productive technology organization that are able to support the needs of the business, able to deliver new product and software capabilities more quickly, all of which ultimately will drive for, again, a better scaled environment and quicker speed to revenue around new product and software delivery in the business. So I'd say overall, the early evidence is incredibly positive around the things that we're doing. Obviously, it's hard work and I don't want to lose sight of that as we continue to progress through our transformation journey. We're making a lot of change in our organization. It is a little bit disruptive at times and it's a tremendous amount of efforts from the leadership team down through the organization to bring about the change that we're trying to drive.

[Cameron Bready, Director & CEO at Global Payments]

But certainly, all evidence thus far would suggest we're on the right path and benefits in terms of how we run the business and the benefits economically we expected to achieve from this journey are certainly proving to be real and the early wins are encouraging.

[Darrin Peller, Managing Director at Wolfe Research, LLC]

Cameron, thanks. And then

[Darrin Peller, Managing Director at Wolfe Research, LLC]

just a quick follow-up.

[Darrin Peller, Managing Director at Wolfe Research, LLC]

Yes, go ahead on the timing or that's exactly right.

[Cameron Bready, Director & CEO at Global Payments]

Yes, it's a good question on the timing of revenue. I think as I look at 2025, what we would expect is as we get to the back half of the year, we'll start to see some of the benefits materialize as a top line revenue matter from the initiatives that we're pursuing, particularly in the merchant segment. There's also likely to be a little bit in the issuer segment as well, you know, more in the back half of twenty twenty five as some of those opportunities start to ramp. In the front half, I would say we've accommodated for a little bit of modest B cell as it relates to just pushing all these changes through the organization.

[Cameron Bready, Director & CEO at Global Payments]

We talked a little bit around the timing of our Genius POS release being second quarter, third quarter. We talked a little bit about the Salesforce of the Future program that we're rolling out, including changes to the comp model. Some of those we rolled out late in 2024. The rest we're rolling out in early twenty twenty five. So we're obviously accommodating for a little bit of disruption in the business as we work these changes through the ecosystem.

[Cameron Bready, Director & CEO at Global Payments]

But that's largely in the first half of the year as we get to the back half of the year as we commented in our prepared remarks. The benefits of many of the transformation initiatives that we're pursuing will start to materialize a little bit more in revenue and the outcomes we're able to drive.

[Darrin Peller, Managing Director at Wolfe Research, LLC]

Very helpful, Cameron. Guys, thanks very much.

[Cameron Bready, Director & CEO at Global Payments]

Thanks, Darren.

[Operator]

Thank you. Our next question comes from the line of Jason Kupferberg with Bank of America. Please proceed with your question.

[Jason Kupferberg, Senior Equity Research Analyst at Bank of America Merrill Lynch]

Good morning, guys. Thanks. I wanted to follow-up on merchant and just clarify the 6% guide for the year. I know it excludes currency and dispositions, but just on the acquisition front, I mean, I think take payments closed around the middle of last year. We're thinking it drives maybe 0.5 of inorganic to merchant this year.

[Jason Kupferberg, Senior Equity Research Analyst at Bank of America Merrill Lynch]

And I know you mentioned a small orchestration platform you bought. So how much are you expecting from acquisitions in that 6%?

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Yes. So, Jason, so Cake Payments had anniversaries in the second quarter and you're right about the 50 basis points of contribution. ZMS, that orchestration layer was that was de minimis. So there's very little that was a contribution to the overall growth in 2025.

[Jason Kupferberg, Senior Equity Research Analyst at Bank of America Merrill Lynch]

Okay, understood. And then just on the EPS guide, just so we're all on the same page, how should we think about the actual dollar based EPS guide, I mean, especially with the absorption of the stock based comp that you're going to be introducing in Q1 just so we all get our models tuned up here right at the beginning of the year?

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Yes. So look, we're guiding constant currency in the 10% to 11% range. Stock based comp this year is going to be about approximately $170,000,000 So you can go ahead and factor that into your models as you think about just the overall EPS growth and that tends to 11% range comps in currency.

[Jason Kupferberg, Senior Equity Research Analyst at Bank of America Merrill Lynch]

Okay. And then 175 bps headwind you said, right, on the EPS line from the currency?

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Yes, for FX, that's correct.

[Jason Kupferberg, Senior Equity Research Analyst at Bank of America Merrill Lynch]

Yes. Okay, cool. Thanks, Josh.

[Operator]

Thank you. Our next question comes from the line of Ramsey El Assal with Barclays. Please proceed with your question.

[Ramsey El-Assal, Managing Director at Barclays]

Hi. Thanks for taking my question this morning. What is the macro backdrop What is the macro backdrop that you're contemplating in guidance? Are you baking in any conservatism or deterioration in the environment? Or are you just kind of baking in what we're seeing today?

[Cameron Bready, Director & CEO at Global Payments]

Yes. I would say from an overall macro perspective, Ramsey, it's Cameron. I think we're continuing to forecast, I'd say, a fairly stable macro environment as we head into 2025, largely looking and mirroring kind of what we saw as we exited the year. I think if you look at the macro overall, we continue to see relatively stable labor trends. Inflation has come down obviously.

[Cameron Bready, Director & CEO at Global Payments]

It's obviously not entirely tamed as evidenced by the report yesterday, but obviously it's down from peak levels that we've seen over the last, call it, eighteen months or so. And obviously wage growth continues to be reasonably good overall. So I would say the macro backdrop, particularly as it relates to the consumer, is relatively stable. Obviously, there's some level of uncertainty as it relates to what's happening in The U. S.

[Cameron Bready, Director & CEO at Global Payments]

Post election and what economic policies the new administration will implement and how that may manifest itself in the overall macro environment more broadly. But I would say sitting here today, we're expecting a fairly stable trend for 2025 and early evidence in January would suggest that we're seeing largely a continuation of what we saw in the fourth quarter.

[Ramsey El-Assal, Managing Director at Barclays]

Got it. And a quick follow-up for me. Just at Investor Day, you called out winding down some enterprise customer contracts, I believe, in core. Has that process begun? Should we expect any noticeable impact from that in a given any particular quarter this year?

[Ramsey El-Assal, Managing Director at Barclays]

Or will it be somewhat less perceptible from the outside?

[Cameron Bready, Director & CEO at Global Payments]

Yes. It's a good question. And we're absorbing that in the guide that we've provided to you today. So there is some of that that's already happened in the fourth quarter and there will be more of that that happens as we work through 2025. Some of that's going to be, I'd say, in a few areas.

[Cameron Bready, Director & CEO at Global Payments]

One is wholesale in particular. We inherited a lot of wholesale relationships through EVO. Some of the economics of those relationships don't necessarily work for us, particularly as we think about the level of effort and support that we have around those relationships and what those resources could be otherwise doing in our business. So we either try to work those to terms that make sense for us, so we'll look to exit those. We talked a little bit around some of the multinational cross border commerce business that we used to pursue.

[Cameron Bready, Director & CEO at Global Payments]

We're doing less of that. I think we're being far more selective as we think about going upmarket into enterprise and multinational opportunities. We were pursuing some, I would call it, more wholesaleindirect FI relationships globally. That's not a business that I want to spend a lot of time and effort on. I think it's subtracting for us.

[Cameron Bready, Director & CEO at Global Payments]

So there are certainly likely to be some changes around how we think about that aspect of our business as we move forward in time. So short answer is yes, all that has started. We did exit some wholesale relationships in the fourth quarter. We have more activity that will likely exit in 2025. All that sort of reflected in the guide that we're providing today and we're absorbing those impacts in our outlook, which is part of the reason for some of the commentary around our medium term outlook that we provided back in September.

[Ramsey El-Assal, Managing Director at Barclays]

Great. Thank you so much.

[Operator]

Thank you. Our next question comes from the line of Tien Tsin Huang with JPMorgan. Please proceed with your question.

[Tien-tsin Huang, Senior Analyst at JP Morgan]

Thanks so much. Good to catch up with everyone. Just on the operational transformation of the $100,000,000 I'm curious, does that change also raise the or they maybe change the timing of savings recognitions in 'twenty five and 'twenty six, any update there?

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Yes. So 'twenty five, I would say, is vastly the same and the majority of the benefits we're going to see in 'twenty six and beyond. So what we said before, Tien Tsin, is that we expect over little approximately $200,000,000 of OI benefit in 'twenty six. Now we expect that to be more in 'twenty six. And then we said approximately $400,000,000 of OI benefit in 'twenty seven and we expect that to be more in 'twenty seven with full run rate of $600,000,000 in 2028.

[Tien-tsin Huang, Senior Analyst at JP Morgan]

Got it. Thank you for that. And a quick follow-up, if you don't mind, Winnie, just on the buying out of the joint ventures here, can we assume that we will see more of this? And is the Asia wind down the inverse, meaning you will maybe get back some of the joint ventures to banks?

[Cameron Bready, Director & CEO at Global Payments]

Yes. It's a good question, Tien Tsin, and I sort of put it in the category of trying to streamline and simplify our business. With the number of joint ventures that we have, particularly in Europe, the complication in governance around the business makes it a little more difficult to operate the business in the way that we want to from time to time. So certainly, the Caixa Bank exit of the Ursa JV simplifies that relationship fairly meaningfully. Obviously, exiting HSBC from our joint venture in Mexico allows us to bring together two businesses in Mexico that by and large were competing with each other given the nature of the relationships we had in that market into a single business.

[Cameron Bready, Director & CEO at Global Payments]

Obviously, with good strong referral partners in Banamex and HSBC, but we're able to operate a much more homogeneous and single operating environment in Mexico now, which is certainly a benefit for us. In Asia, we really only have one JV and that's with Bank of the Philippine Islands in The Philippines. We're very committed to that relationship in that market. We have good scale in that market. We have good growth potential with a strong partner.

[Cameron Bready, Director & CEO at Global Payments]

So that's obviously something that we want to continue with. The markets that we're seeking to exit in Asia are markets where we own 100% of the business, but there are markets that I would characterize as we're a subscale player today. We don't see a realistic path to being a scale player in a timeframe that makes sense for us and we'd rather commit our time, effort and resources to markets where we see better opportunities for us.

[Tien-tsin Huang, Senior Analyst at JP Morgan]

Got it. No, makes great sense. Thank you.

[Cameron Bready, Director & CEO at Global Payments]

Thanks, Andrew.

[Operator]

Thank you. Our next question comes from the line of Dave Koning with Baird. Please proceed with your question. Yes.

[David Koning, Senior Research Analyst at Robert W. Baird & Co]

Hey, guys. Thank you. And great to see just the quality of earnings here getting better cash flow leverage, lower add backs, all that stuff. So congrats on all that.

[Cameron Bready, Director & CEO at Global Payments]

Dave, are you still there? We lost you. We appreciate the compliment. But, operator, maybe we'll move to the next and see if we can get Dave back.

[Operator]

Yes. Our next question comes from the line of James Faucette with Morgan Stanley. Please proceed with your question.

[James Faucette, Managing Director at Morgan Stanley]

Great. Good morning. And I'll get straight to my question. So wondering if we can get an update on Issuer segment and is the assumption for fiscal twenty twenty five continuation of softer trends in the commercial card and pay card that you called out and how should we think about the growth from the implementation of those 70,000,000 accounts in backlog?

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Yes, sure. I'll go ahead and take that. So look, from for Issuer, we expect revenue to be relatively in line with where we exited the year in Q1. We do expect to see modest improvement throughout the year as we see increased benefit from conversion activity and lapping the renewal cycle with many of our large issuers. And what I would say is, as it relates to issuer, just for Q4, we continue to see strong trends in issuer.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

We saw four conversions for the year. Cameron commented on 'seventeen conversions for the year. The pipeline stands at over 70,000,000 accounts on file. We saw strong sequential growth in accounts on file. And we also saw sequential improvement as it relates to transaction.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

So we feel pretty good about the Issuer business going into 2025 and we expect to see modest acceleration in the back half of the year as we lap some of these contract renewals that we talked about in Q3.

[Cameron Bready, Director & CEO at Global Payments]

Yes. And James, this is Cameron. I'll just add maybe a couple of points to that. First of all, I would say from a commercial perspective, the trends we saw in Q4 were pretty consistent with what we saw in Q3. So we expect commercial in 2025 to be relatively similar to what we saw kind of exiting the year.

[Cameron Bready, Director & CEO at Global Payments]

We're not expecting a big sort of uptick in commercial volumes. We expect businesses to remain fairly restricted from a spending perspective and we think that will largely manifest itself in what we expect from commercial. We are seeing more normalizing of trends, I would say, around project activity with our large FI customers. Josh called that out as it relates to Q4. And certainly, we have a good pipeline of projects that we're implementing for our clients in 2025.

[Cameron Bready, Director & CEO at Global Payments]

So we certainly feel good about that. I think if you step back and look at the issuer business more broadly, I think we feel very good about the outlook for the next few years. We've renewed 15 of our top 20 client on multi year agreements. Our modernization work is progressing very nicely. I mentioned that our client facing application development work was done late last year.

[Cameron Bready, Director & CEO at Global Payments]

We're piloting all those solutions in 2025 and we'll be selling exclusively sort of cloud based solutions for client facing applications by the end of twenty twenty five. So all of that is progressing really nicely, which is important to opening up new TAMs, driving more commercial activity and obviously accelerating the rate of revenue growth for the issuer business over a period of time. So feel good about the stability and predictability of the business heading into 'twenty five and certainly the trajectory it's on through modernization and obviously the work we're doing from a transformation perspective, all of which we expect to benefit the Issuer business for the coming years.

[James Faucette, Managing Director at Morgan Stanley]

Great. That's great color. And then quickly just wanted to touch on the ISV channel. It sounds like the partner growth there is still healthy. How are you thinking about the churn in revenue pricing in that business in 'twenty five and in 'twenty six?

[Cameron Bready, Director & CEO at Global Payments]

Yes. I will start and I may ask Bob to chime in on this as well. As you probably are aware, he knows the integrated business very, very well from his history and can give you a little more perspective on what we are seeing in the market day in and day out. I would say from my standpoint, I think we continue to compete very well in the market from an integrated perspective. We obviously have a breadth and depth of operating model and capability that allows us to tailor solutions to the needs of our software partners in ways that I don't think our competitors can.

[Cameron Bready, Director & CEO at Global Payments]

And I think as a result of that, we're able to end up with commercial relationships that are favorable to us, favorable to our clients, but not necessarily at the high watermark in terms of rev share relative to where our competitors may pitch business or try to win business. I think the other area where we continue to differentiate ourselves is our ability to bring more value to the relationship around our commerce enablement solutions, our ability to expand the revenue opportunity through these relationships. More revenue to share generally means lower rev share overall and a better outcome for us again in our ISV partner. So I think we continue to see largely stability around our business largely because of our approach to market, the capabilities we have and the breadth and depth of relationships that we have in that business. It spans well over a decade now with Global Payments ownership and going back far more than that through the acquisitions we've made in our integrated space over time.

[Cameron Bready, Director & CEO at Global Payments]

But Bob may be able to add a little bit of color to that as well.

[Robert Cortopassi, President & COO at Global Payments]

Yes. Thanks Cameron. Great question, James. We continue to see partners across the spectrum, whether they are ISVs or whether they are other flavors of new tech, fintech, FI relationships with different integration needs, who continue to think about integrated as a departure from the last two pendulum swings we saw over the prior decade, which was coming from integrate to us, send a lead, we'll cut you a referral check to everyone in the world needs to be a PayFac and become a payments company. They continue to want to differentiate at the customer experience level, what does it look like to acquire and board new accounts.

[Robert Cortopassi, President & COO at Global Payments]

And it continues to be important to them to drive to Cameron's point additional value into the relationship beyond core payment acceptance. And I think the work that we've done over the prior decade and that we continue to accelerate at the back half of '24 and into '25 as part of our transformation seeks to make those capabilities available in very easy to consume and integrate ways across the spectrum of our capabilities, so that our partners can go to market really in a very tailored way without having to create a bespoke program or a bespoke integration for every one of them. We continue to see that being received very well in the market. We think we're positioned well against competition. And it also helps us defend the partnerships that we already have as they seek to evolve their own business model and their own software and distribution platforms.

[James Faucette, Managing Director at Morgan Stanley]

Appreciate that Bob.

[Operator]

Thank you. Our next question comes from the line of Brian Bergin with TD Cowen. Please proceed with your question.

[Harrison Vivas, Analyst at Cowen]

Great. Thanks so much for taking the questions. This is Harrison Bivos on for Brian. Just wanted to double click on the POS replatforming. Obviously, still early, but could you just offer any early feedback on what you're hearing from clients?

[Harrison Vivas, Analyst at Cowen]

And then maybe put a finer point on what you're expecting from a churn level as you really start that as you launch Genius into the second half of the year?

[Cameron Bready, Director & CEO at Global Payments]

Yes, I'll start and I may ask Bob to jump in on this question as well, again, because he's very close to the details. I would say, as I mentioned in my prepared remarks, remarks, early feedback is very positive from our direct sellers, our dealers, our FI partners and wholesale partners who we look to sell Genius as well. And certainly from our international businesses and some of our partnerships there, the feedback around the platform, the capability, the richness of the feature functionality is very positive around what we expect to be the flagship kind of Genius Restaurant and Genius Retail platforms going forward. So I would say early signs are encouraging, and we continue to have good momentum just around POS sales more broadly even as we work to bring the rebranded Genius, the replatform Genius to market over the course of 2025 and beyond. So I'm very encouraged.

[Cameron Bready, Director & CEO at Global Payments]

This continues to be one of the areas that we're investing most in our business. It's one of the areas that we're most excited about in terms of opportunity to drive better growth outcomes over time. And I think the capabilities that we have across the probably nearly fifteen, sixteen POS platforms we have today, finally harnessing that into what will be genius for restaurant, genius for retail platforms going forward, I think is going to have a really positive effect on our business, our ability to win new opportunities in the marketplace. And obviously, as I said before, the growth outcomes that we think we can deliver. I'll let Bob maybe jump in on the second part of your question around how we envision creating paths for existing merchants to upgrade and how we plan to manage sort of the attrition associated or attrition risk associated with those opportunities.

[Robert Cortopassi, President & COO at Global Payments]

Yes, Harrison, as we think about churn in the POS space, I think there's a couple of components at play here. One is, obviously, we respect the competitive environment that we're operating in and we have fierce competition who's aggressive in their own right. But we also have long and successful relationships with these customers, not only anchored in the solutions that we've delivered to them in the past, but the way that we've differentiated around the service experience and the continued rollout of additional value added services that we're bringing to the relationship beyond just the core business operating software in a restaurant or a retail environment. Second, as customers begin to think about what's the next phase of their technology growth, as I mentioned before, we've got a strong relationship. So it's our belief and it's our historical experience that they think about us first.

[Robert Cortopassi, President & COO at Global Payments]

And we want to be there as they're thinking about the evolution of their business and providing ramps for them to migrate to new solutions that we're going to deliver. And then finally, we didn't invent Genius De Novo. A fair bit of what we're rolling out in both the retail and the restaurant verticals are anchored in solutions that we have in market today and this is the next generation of those platforms. So there's a very natural upgrade path for a large share of these customers who don't require things like a data conversion, in many cases may not even require new hardware. So I think we feel really good about the opportunity to retain our existing customers while growing the relationship and delivering them more value as well as our competitive positioning to acquire new accounts over the next period of time.

[Harrison Vivas, Analyst at Cowen]

No, great. That's helpful. And then just a quick follow-up on incremental asset sales. Cameron, I know you talked about exiting some subscale APAC businesses in the quarter. Just any commentary on potential additional processes that might be underway?

[Harrison Vivas, Analyst at Cowen]

Should we expect maybe more subscale geographic trimming? Or are you potentially looking at vertical software platforms to monetize? Just any commentary there would be great. Thanks.

[Cameron Bready, Director & CEO at Global Payments]

Yes, it's a fair question Harrison. I don't want to get ahead of my skis on this obviously just to sort of protect the integrity of the processes that we're currently involved in and contemplating. I think as I step back and look at where we are, we've divested assets today that represent a little north of $300,000,000 up to $500,000,000 to $600,000,000 target that we provided at our investor conference. We still think $500,000,000 to $600,000,000 is the target that we are likely to achieve over the course of time. I think about it largely through the lens of a couple of things.

[Cameron Bready, Director & CEO at Global Payments]

One is, we've talked about it in the context of the Asian businesses. Are we a scale player in these markets with good prospects to grow meaningfully? And is the market worth our time, effort and resources? And do we have a path? If we're not a scale player today, do we have the path to being a scale player over time?

[Cameron Bready, Director & CEO at Global Payments]

So obviously, places where we're not and don't feel like we have that path are clearly on our minds in terms of how to think about that business being a part of Global Payments going forward. And then secondly, I look at all of our businesses today through the lens of is it better being a part of Global Payments? Are we delivering value incrementally to that business as with it being a component of our company? Or can the business be self sustained outside of Global Payments without

[Cameron Bready, Director & CEO at Global Payments]

creating

[Cameron Bready, Director & CEO at Global Payments]

a lot of disruption for it. So there are a few businesses that we're still assessing, I would say, on that front. And we'll continue to provide updates as and when there is information to share around potential outcomes that we're able to achieve.

[Operator]

Thank you. Our next question comes from the line of Dan Perlin with RBC Capital Markets. Please proceed with your question.

[Dan Perlin, Managing Director at RBC Capital Markets]

Thanks. Good morning, everyone. I'm wondering if you're willing to put a little bit of a finer point on this '25 revenue growth cadence. I know you're can you get the five to six bogey out there? You're talking about second half being stronger than first half.

[Dan Perlin, Managing Director at RBC Capital Markets]

But I guess what I'm trying to get at is, as you think about that commentary, are you suggesting that we're at the low end

[Dan Perlin, Managing Director at RBC Capital Markets]

of the range in kind of

[Dan Perlin, Managing Director at RBC Capital Markets]

the first half and then you accelerate to the high end? Or are we going to

[Dan Perlin, Managing Director at RBC Capital Markets]

be maybe potentially below the range in the first half and then a reacceleration even outside of that range in the second half, which kind of does support an exit rate or run rate to jump off into 26 with reacceleration? Thanks.

[Cameron Bready, Director & CEO at Global Payments]

Yes. Dan, it's Cameron. I'll start and I'll ask Josh to jump in if he wants to put a finer point on any of the commentary. To answer your question very pointedly, no, you shouldn't assume the first half of the year is below the range, the back half of the year is above the range. I'd say the whole year is in the range.

[Cameron Bready, Director & CEO at Global Payments]

We talked a little bit before about the shaping and why the shaping exists around the year, but you shouldn't expect the range to be different for the first half versus back half. Both halves are in the range. And I think generally, if I'm being candid, we're talking about tens of basis points of difference probably first half, back half in terms of just the overall shaping. So I wouldn't put an expectation in your mind that first half is below the range, second half is above the range. I think it's largely first half is a little lower in the range and second half is likely to be higher in the range with a good exit rate heading into 2026.

[Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments]

Yes. What I would say is that we're going to see a slight acceleration as we go into the back half of the year. And as Cameron mentioned in his prepared remarks and earlier on this call, we are factoring in a little bit of a slowdown in the first half as it relates to just transformation activities that we talked about, retooling the sales force, revamping compensation structure and exiting some markets and consolidating platforms. But again, we're very much within the range and I would expect to see acceleration in the back half, like we talked about at investor conference going into 'twenty six and beyond.

[Dan Perlin, Managing Director at RBC Capital Markets]

That's great and very clear. Thank you for that. Just quickly, Cameron, and it's kind of again a little bit high level. In terms of your conviction level and visibility into the organization now, you're doing a lot of things as you call out the homogeneity of the platforms and internal organization. I'm just wondering how much of an impact that's having on your ability to forecast and then again the visibility and conviction in these numbers?

[Dan Perlin, Managing Director at RBC Capital Markets]

Thank you.

[Cameron Bready, Director & CEO at Global Payments]

Yes, look, we obviously have a lot of confidence I think in the outlook for the business that we're providing today. We have a lot of confidence in the medium term outlook that we provided back in September. I think our visibility around it is arguably better today than it was in September when we obviously provided our medium term outlook. We've seen the early results of much of the transformation work that we're pursuing in our business. The outcomes we've been able to drive and certainly how the organization has responded to those changes.

[Cameron Bready, Director & CEO at Global Payments]

And as I said in earlier comments today, I'm very encouraged about what we've seen thus far. I don't want to again minimize the amount of work that it takes and certainly how proud I am of our teams as they've been able to navigate these changes in the organization in terms of how we're structured, how we're operating, the tools and systems that we're using and how we're bringing together the best parts of Global Payments around the globe to try to drive to better outcomes and create a better business for the long term, it takes a toll on our teams and they've reacted admirably, I think, to the amount of work and stress and change that we're trying to push through the ecosystem to get to the outcomes that we have committed to as part of our medium term outlook back in September. So long answer to a relatively simple question, but yes, we have conviction in the outcomes that we're going to be able to drive. I think we have good visibility around the benefits that we are generating through our operational transformation initiatives. We track those dollar for dollar through a very intensive process.

[Cameron Bready, Director & CEO at Global Payments]

And obviously, I think we have probably greater visibility and excitement around the opportunities to deliver better outcomes for the business from a growth sustainable organic growth perspective and the outcomes we're able to drive for our clients and shareholders over that period of time.

[Dan Perlin, Managing Director at RBC Capital Markets]

Great. Thank you so much.

[Cameron Bready, Director & CEO at Global Payments]

Thanks Dan.

[Operator]

Thank you. Our final question this morning comes from the line of Vasu Govil with KBW. Please proceed with your question.

[Vasundhara Govil, Managing Director at Keefe, Bruyette & Woods (KBW)]

Hi, thanks for taking my questions. And Cameron, you covered this a fair amount, but I just wanted to get a finer point on it. I think when you guys guided to 2025 at the Investor Day, it was mid single digit. So if I'm categorizing that correctly, four to six and now you're guiding to five to six, so it's slightly better. Just if you could help pinpoint like what exactly is trending better in the business, that would be great.

[Vasundhara Govil, Managing Director at Keefe, Bruyette & Woods (KBW)]

And then I have a quick follow-up.

[Cameron Bready, Director & CEO at Global Payments]

Yes, Vassu, it's Cameron. I'll just comment quickly. First of all, I appreciate you calling that out. I would say, arguably, it is slightly better than what we guided to and provided in the medium term outlook in September. It's on the margin, of course, it's still mid single digits, but it's at the upper half of mid single digits.

[Cameron Bready, Director & CEO at Global Payments]

And I think again, some of it goes back to the conviction we have around how we see the operational transformation manifesting itself and performance in the business. Obviously, as we're closer now and actually into 2025, I think we have better visibility around how we'll be able to navigate the level of change in the business without creating disruptions that will have a more meaningful impact on growth certainly in the short term as we look to drive better longer term outcomes. So I think a lot of it is again early success and confidence around the work we're doing and how that positions us and our ability to manage as a leadership team and an organization more broadly the change that we're driving through the ecosystem to drive to the outcomes for 2025 as we position for again a better outcome in 'twenty six and 'twenty seven.

[Vasundhara Govil, Managing Director at Keefe, Bruyette & Woods (KBW)]

Thank you for that. And just a quick one on the deck modernization in the Issuer business and the launch of the cloud based apps, like would that mean anything from a revenue standpoint?

[Cameron Bready, Director & CEO at Global Payments]

Well, it does certainly over time because as we talked about before, the cloud modernization program for Issuer really expands our TAM for that business fairly extensively. It allows us to go down market with smaller FIs relative to where we have traditionally played in our Issuer business. It allows us to expand more easily into new markets without a lot of fixed cost and investment to be able to line up new clients in new markets around the globe. I think it makes our capabilities more consumable by fintechs and other players, who are looking to be able to consume and utilize our services perhaps differently than having to consume the entirety of the platform that we operate today that is still more mainframe oriented and requires almost a full consumption of everything to get to the feature functionality that some of these fintechs really want to be able to utilize. So from our perspective, the modernization is critical to unlocking better growth opportunities for the issuer business longer term by accessing these new TAMs and creating better opportunities to expand the pool of revenue that we can play in.

[Cameron Bready, Director & CEO at Global Payments]

We know we have the best feature functionality. We know we have the best issuer capabilities. Being able to unlock those into new markets globally as well as new segments of the markets that we've played in the geographies that we're active today is certainly meaningful from a growth potential for the business longer term.

[Vasundhara Govil, Managing Director at Keefe, Bruyette & Woods (KBW)]

Thank you very much for the color.

[Cameron Bready, Director & CEO at Global Payments]

Thanks for the question. And with that, that concludes our Q4 earnings call this morning. I want to thank everyone for joining us again today. And I wish everyone a great day.

[Operator]

Thank you. This concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation.

Participants

Analysts

• Winnie Smith, SVP, IR at Global Payments
• Cameron Bready, Director & CEO at Global Payments
• Josh Whipple, Senior Executive Vice President and Chief Financial Officer at Global Payments
• Darrin Peller, Managing Director at Wolfe Research, LLC
• Jason Kupferberg, Senior Equity Research Analyst at Bank of America Merrill Lynch
• Ramsey El-Assal, Managing Director at Barclays
• Tien-tsin Huang, Senior Analyst at JP Morgan
• David Koning, Senior Research Analyst at Robert W. Baird & Co
• James Faucette, Managing Director at Morgan Stanley
• Robert Cortopassi, President & COO at Global Payments
• Harrison Vivas, Analyst at Cowen
• Dan Perlin, Managing Director at RBC Capital Markets
• Vasundhara Govil, Managing Director at Keefe, Bruyette & Woods (KBW)