FIS (Fidelity National Information Services) raised its full-year free cash flow guidance to $2.2 billion, representing 36% year-over-year growth, and outlined a path to more than $3 billion in GAAP free cash flow by 2028, according to remarks made at the Goldman Sachs Communacopia + Technology Conference on September 8, 2026.
Chief Executive Officer Stephanie Ferris and Chief Financial Officer James Kehoe told attendees the company reduced its one-time cash expenses from an original $800 million to $730 million, with plans to cut the initial figure by at least half over the next two years. The revised $730 million comprises approximately $275 million tied to Total Issuing Solutions integration, roughly $90 million on other merger-related integration costs, and about $200 million in severance charges.
Leverage currently stands at 3.5 turns, with a target to reach the high 2s. Share repurchases remain paused until that threshold is met, management said. The stock trades at a price-to-earnings ratio of 6.1 and carries a dividend yield of 4.46%, up 10% over the trailing twelve months. FIS has maintained dividend payments for 24 consecutive years.
Recurring annual contract value growth reached 20% in the fourth quarter and accelerated to 24% in the first quarter. Both banking and capital markets segments are expected to deliver mid-single-digit recurring growth for the full year, while TSYS is tracking at mid-single-digit growth around 6%. Capital markets grew 9% in the third quarter of last year, creating a challenging comparable for the current third quarter. Overall technology spending grows at 7% to 8%.
On the artificial intelligence front, FIS announced a partnership with Anthropic to build AI agents for financial crimes work, including anti-money laundering and suspicious activity report filings. The first financial crimes agent is targeted for launch in the second half of 2024 with BMO and Amalgamated Bank. Broader commercialization and material revenue generation are expected in 2027, with no material revenue from the Anthropic collaboration included in the 2026 guidance. A second agent focusing on credit card and debit card disputes is under development.
FIS also noted it successfully migrated a major client's entire consumer card portfolio through Total Issuing Solutions without a single issue. Seventy-two of the company's top 100 clients consume services across banking, payments, and capital markets. In capital markets, FIS announced a strategic review of select products within the portfolio that do not overlap with its existing client base.
The discussion was moderated by Will Nance, who covers payments and fintech for Goldman Sachs.
