Payments tech firm FIS hikes revenue forecast on boost from consumer spending
Nov 7 (Reuters) - Banking and payments conglomerate Fidelity National Information Services on Tuesday raised its annual revenue forecast as it gained from robust consumer spending.
The company said it now expects annual revenue of $14.60 billion to $14.65 billion, compared with its previous forecast range of $14.50 billion to $14.63 billion.
Tight labor market and strong wage growth have buoyed consumer spending even as concerns about 'higher for longer' interest rates have led to some economic uncertainty.
Stronger spending volumes benefit payment processors like FIS which charges banks and merchants a fee for processing transactions.
The company's net income from continuing operations in the third quarter ended Sept. 30 came in at $260 million, compared with $218 million a year earlier.
For FIS, revenue from the banking solutions business, its biggest segment that offers core processing and transaction processing software to financial institutions, rose 3% to $1.76 billion, driven by benefits of servicing federally funded pandemic relief programs.
Discontinued operations, or its Worldpay merchant solutions business that is set to be separated, reported $1.2 billion in revenue.
In July, FIS agreed to sell a 55% stake in its Worldpay business to private equity firm GTCR in a deal that values the unit at $18.5 billion.
The company also announced plans to repurchase about $500 million shares in the current quarter.
Peer Global Payments last month topped Wall Street estimates for third-quarter profit and raised annual earnings forecast. (Reporting by Arasu Kannagi Basil in Bengaluru; Editing by Maju Samuel)
