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Jun 30, 2022
Global Payments Q2 2022 Earnings Report
Global Payments' second quarter performance was the best in its history, exceeding expectations despite incremental challenges.
Key Takeaways
Global Payments Inc. reported strong second-quarter results, with both Merchant and Issuer businesses exceeding targets. The company is also acquiring EVO Payments, receiving a strategic investment from Silver Lake, and selling Netspend's consumer assets to refine its portfolio.
GAAP revenues were $2.28 billion, compared to $2.14 billion in the second quarter of 2021.
Adjusted net revenues increased 6.1% to $2.06 billion, compared to $1.94 billion in the second quarter of 2021; excluding the Netspend consumer assets, now classified as held for sale, adjusted net revenue increased 9.0%.
Adjusted earnings per share increased 15.7% to $2.36, compared to $2.04 in the second quarter of 2021.
Adjusted operating margin expanded 200 basis points to 43.8%; excluding the Netspend consumer assets, adjusted operating margin was 45.3%.
Global Payments
Global Payments
Global Payments Revenue by Segment
Revenue by Segment
Merchant Solutions Revenue
CapyFin.comIssuer Solutions Revenue
CapyFin.com Forward Guidance
For 2022, the company expects constant currency adjusted net revenue before dispositions in a range of $8.48 billion to $8.55 billion, reflecting growth of 10% to 11% over 2021 and consistent with prior outlook. Further, adjusted earnings per share on a constant currency basis are expected to be in a range of $9.53 to $9.75, reflecting growth of 17% to 20% over 2021 and consistent with prior outlook. Also, the company is raising its expectation for adjusted operating margin expansion to up to 150 basis points, an increase from the prior outlook of up to 125 basis points.
Positive Outlook
- Expects constant currency adjusted net revenue before dispositions in a range of $8.48 billion to $8.55 billion, reflecting growth of 10% to 11% over 2021.
- Adjusted earnings per share on a constant currency basis are expected to be in a range of $9.53 to $9.75, reflecting growth of 17% to 20% over 2021.
- Raising expectation for adjusted operating margin expansion to up to 150 basis points, an increase from the prior outlook of up to 125 basis points.
- Presumes continuing recovery from the pandemic worldwide.
- Presumes a stable global macroeconomic environment throughout the remainder of this calendar year.
Challenges Ahead
- Ongoing macro concerns.
- Exit of Russian business.
- Incremental headwinds from adverse foreign currency exchange rates.
- Acquisition of EVO Payments and the disposition of Netspend’s consumer business to close in the first quarter of 2023.
- Subject to receipt of regulatory approvals and satisfaction of customary closing conditions.
Revenue & Expenses
Visualization of income flow from segment revenue to net income