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First Data reports earnings, revenue beats
Shares of First Data Corp. are up 4.3% in premarket trading after the card processor reported better-than-expected earnings and revenue for its second quarter. The company posted net income of $341 million, or 36 cents a share, up from $185 million, or 20 cents a share, in the year-earlier period. Adjusted earnings per share fell to 39 cents from 40 cents but came in ahead of the FactSet consensus expectation of 37 cents. The company said the decrease was due to the company’s tax rate and was mostly offset by First Data’s operating results. Total revenue fell to $2.5 billion from $3.0 billion in the year-ago period. The company’s revenue came in above analyst estimates for $2.4 billion. Chief Financial Officer Himanshu Patel told MarketWatch that the company’s results were driven by “broad-based strength” across various business areas. He said First Data was picking up share in the independent software vendor (ISV) channel, the agent space, and in international markets such as Brazil. First Data’s Clover business saw 50% growth in payment volume during the quarter and the product is expanding into new markets, he said. Patel expects a U.K. regulatory review of merchant acquiring, which is in the very early stages, to be “immaterial” given the size of First Data’s U.K. business relative to the overall company. First Data now expects total segment revenue growth of 7% to 8% for the full year, up from its previous projection of 6% to 7% growth. The stock was up 35% so far this year, as of Friday’s close, compared with a 5.4% rise for the S&P 500 over that time.