(Reuters) -Fiserv tempered down annual revenue growth forecast on Wednesday, as the payments firm grapples with slowdown in the Clover business, its point-of-sale and business management platform.
Shares of the Milwaukee, Wisconsin-based company slipped 16% in premarket trading. They have lost 19.2% this year.
Payments volume growth at Clover has softened this year, weighed down by difficult gateway conversion comparisons and slowing spending in Canada. The trend has raised doubts among analysts and investors about the company’s ability to meet its annual forecasts.
Fiserv expects 2025 organic revenue to rise about 10%. It had earlier forecast 10% to 12% growth.
The company had initially anticipated a slower start to the year, with faster growth in the back half.
“We made several refinements to our guidance based on our year-to-date performance and current business activity levels,” said CEO Mike Lyons.
The results present a major challenge to Lyons, who took the top role just months ago. Lyons said last month he had walked into “bit of a firestorm” amid intense investor scrutiny around Clover.
Executives previously said Clover was on track to hit $3.5 billion in revenue this year. In the second quarter, the business reported 8% volume growth, in line with the preceding three months.
Still, Fiserv expects to deliver its 40th consecutive year of double-digit growth in adjusted earnings per share.
It forecast adjusted profit per share to be between $10.15 and $10.30 for 2025, compared with its prior projection of $10.10 to $10.30.
Excluding one-time items, the company earned $2.47 per share during the quarter, beating analysts’ estimate of $2.43, according to data compiled by LSEG.
Separately, Fiserv said it has agreed to buy a part of TD Bank’s merchant processing business in Canada. The deal includes a portfolio of about 3,400 TD merchant relationships that will migrate to Fiserv’s processing system and Clover.
(Reporting by Arasu Kannagi Basil in Bengaluru; Editing by Shilpi Majumdar)
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