Fidelity National Info (FIS) Q2 2026 Earnings Report

The call conveyed a predominantly constructive picture: strong top-line and margin performance driven by Banking and Payments, a substantial improvement in free cash flow, successful integration and commercial traction from the Total Issuing Solutions acquisition, and early tangible AI-driven productivity gains. These positives were tempered by execution issues in Capital Markets—notably weaker professional services sales and slower backlog conversion—plus a rebase of Capital Markets guidance and a modest cut to company revenue guidance. Management has clear mitigation plans (strategic review, operational actions) and raised cash flow guidance, but near-term Capital Markets headwinds remain the principal negative.

Management updated 2026 guidance: full‑year adjusted revenue growth was lowered to 4.5–5.0% (from 5.1–5.7%), Banking guidance was reiterated while Capital Markets was rebased to 3.0–3.5% (a 225 bp cut, including ~120 bp from lower professional services), and full‑year adjusted EBITDA margin expansion is now expected at 85–105 bps (vs prior 95–110). Adjusted EPS is guided to grow 7.0–8.5% for the year, free cash flow was increased by $100M to $2.15–2.25B (~$2.2B midpoint, ~+36% YoY at midpoint) after Q2 FCF of $525M and ~ $1.0B YTD (trailing 12‑month FCF $2.2B), leverage is down to 3.5x, and non‑GAAP one‑time cash costs were reduced by $70M to a $730M midpoint. Near‑term (Q3) guidance calls for pro forma revenue growth of 2.9–3.7% (Banking 3–4% as M&A contribution drops ~100 bps; Capital Markets 2.5–3% with ~105 bps M&A), company EBITDA margin expansion of 80–100 bps, and Q3 adjusted EPS growth of 4.6–7.3%; management also reiterated TSYS/Total Issuing synergy targets (> $150M EBITDA benefit by 2028, $125M cost synergies/$45M revenue synergies) and a path to > $3B FCF by 2028.