Key facts
- Fiserv shares fell nearly 41% after missing Q3 earnings and revenue targets.
- The company drastically cut its full-year revenue growth forecast to 3.5%-4% from ~10%.
- CEO Mike Lyons, appointed in May, is departing amid the company's performance issues.
- Fiserv announced a leadership shake-up, including new CFO, co-presidents, and board members.
- The company plans to move its stock listing from the NYSE to the Nasdaq on November 11.
Fiserv shares plummeted nearly 41% on Wednesday, marking the company's largest single-day drop on record, after it reported third-quarter results that missed Wall Street expectations and significantly lowered its full-year financial outlook. The fintech payment company's stock fell to its lowest level in over five years, having lost approximately 70% of its value since a March high.
CEO Mike Lyons, who was appointed in May, acknowledged that the company's current performance was not meeting expectations and attributed challenges partly to slowing cyclical growth in Argentina and deferred investments. Fiserv slashed its full-year revenue growth forecast to between 3.5% and 4%, a sharp decrease from the approximately 10% projected just three months prior. Adjusted earnings per share guidance was also reduced to $8.50-$8.60 from $10.15-$10.30.
In response to the disappointing quarter, Fiserv announced a five-point action plan and a significant leadership overhaul. Paul Todd, formerly CFO of Global Payments, has been appointed as the new CFO, succeeding Bob Hau. Takis Georgakopoulos and Dhivya Suryadevara will serve as co-presidents, effective December 1. Additionally, Gordon Nixon, Céline Dufétel, and Gary Shedlin are joining the board of directors, with Nixon taking on the role of non-executive chairman.
Fiserv also intends to move its stock listing from the New York Stock Exchange back to the Nasdaq, with trading expected to begin under the ticker symbol "FISV" on November 11. Analysts expressed surprise at the rapid deceleration in merchant organic revenue growth and the financial solutions segment, with some suggesting that Wall Street had previously overvalued Fiserv's stock, and that the current situation reflects a return to a more rational valuation rather than a crisis for the company.