Global Payments Q3 2026 Earnings Call Transcript

Global Payments (NYSE:GPN) reported third-quarter financial results on Thursday. The transcript from the company’s third-quarter earnings call has been provided below.

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View the webcast at https://global-payments-q3-26-earnings-call.open-exchange.net/registration

Summary

Global Payments Inc. reported a 4% increase in adjusted net revenue and a 10% rise in adjusted EPS for Q3 2026, with a focus on disciplined execution and capital allocation.

The company raised its run-rate expense synergy target from the Worldpay integration to $650 million by 2028, highlighting progress in the integration process.

Strategic initiatives include focusing on delivering differentiated products, enhancing client experiences, and leveraging scale to drive innovation and adoption.

Genius, the flagship offering for the SMB segment, showed strong growth with bookings doubling year over year and expanding into new markets and channels.

Future guidance reaffirms expectations of 4-5% revenue growth and 150 basis points margin expansion for 2026, with continued investment in innovation and capital returns to shareholders.

Full Transcript

OPERATOR

Ladies and gentlemen, thank you for standing by and welcome to Global Payments’ third quarter 2026 earnings conference call. At this time, all participants are in listen-only mode. Later, we will open the lines for questions and answers. As a reminder, today’s conference call will be recorded. At this time, I would like to turn the conference over to your host, Senior Vice President, Investor Relations, Mr. Nate Rozoff. Please go ahead.

Nate Rozoff (Senior Vice President, Investor Relations)

Good morning. Welcome to Global Payments’ third quarter 2026 conference call. Joining us today are our CEO, Cameron Bready, CFO, Josh Whipple, and COO, Robert Cortopassi. Some of the comments made during today’s conference call will contain forward-looking statements. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied, and we caution you not to place undue reliance upon them. They speak only as of the date of this call, and we undertake no obligation to update them.

In addition, we will be referring to several non-GAAP financial measures. For a full reconciliation of the non-GAAP financial measures to the most comparable GAAP measure, please see our press release furnished as an exhibit to our Form 8-K filed this morning and the supplemental material available on our investor relations website. Finally, the slide presentation that accompanies our prepared remarks is also available on our investor relations website.

With that, I’ll turn the call over to our CEO, Cameron.

Cameron Bready (President and CEO)

Thank you, Nate. And good morning, everyone. We are pleased with our third quarter performance, which was consistent with our expectation and reflects the continued disciplined execution of our team members worldwide. Adjusted net revenue accelerated sequentially to more than 4% on a constant currency basis, excluding dispositions. Adjusted operating margins expanded 220 basis points, excluding dispositions, reflecting ongoing integration, execution, and synergy realization, and adjusted earnings per share increased 10%.

Capital allocation remains a central pillar of our investment thesis. We returned over $200 million to shareholders through buybacks and dividends during the third quarter and continue to expect to return more than $2 billion to shareholders in 2026, keeping us on track to return approximately $7.5 billion cumulatively over the 2025-2027 timeframe. Our integration of Worldpay continues to track ahead of our plans, and given the strong progress we’ve made, we are raising our run-rate expense synergy target from $600 million to $650 million by the end of 2028.

With the foundational elements of the combined company now firmly in place, we’re focused on the strategy that will shape the next chapter of Global Payments. I will use my time this morning to outline that strategy and highlight the execution already underway across our business. Global Payments is fundamentally a different company than it was a year ago. With our combination with Worldpay and the exit of our issuer business, we are now solely focused on providing commerce solutions around the world. That gives us much greater clarity of focus, and it brings together tremendous scale, reach, and capabilities that create significant potential for our company. Our opportunity is to mobilize our scale and capabilities in ways that create greater value for our clients and partners and position us to compete and win in a rapidly changing market.

Our ambition is clear: to become the worldwide partner of choice, Commerce Solutions. Our strategy provides the path to get there, and it is anchored in three pillars. The first is delivering differentiated products and solutions. We will compete on the value and capabilities we bring to the market, not simply on price, through software, embedded financial services, data and insights, fraud and optimization capabilities, and AI-enabled solutions—experiences that help our clients run and grow their businesses more effectively.

Second is providing a distinct client and partner experience. We are making Global Payments simpler and easier to buy from, integrate with, grow with, and stay with, combining strong digital capabilities with expertise and high-touch engagement where it matters most. Third is harnessing our immense scale and reach. We’re making better use of our global distribution relationships, data, and investment capacity to accelerate innovation, expand adoption, and bring our best capabilities to more clients and partners worldwide.

These pillars reinforce each other. Better products create better outcomes for our clients, better experiences deepen our relationships, and our scale and distribution allow us to extend those advantages more broadly. Many of the investments that underpin this strategy are already well underway. What the strategy provides is greater clarity and alignment around where we will focus our resources and how we will win in the marketplace. Importantly, we have already established the foundation needed to execute this strategy. Our new organizational structure is now in place across our entire team. We employed a best-of-both approach to select the strongest leaders and team members from both heritage organizations, providing us with a wealth of expertise that is unmatched in the industry. We are also now fully organized around our three go-to-market segments—SMB, enterprise, and platforms—supported by shared capabilities across product, technology, and operations, with clear accountability for faster decision-making.

In addition, building on the target technology architectural model we defined last quarter, we are rapidly advancing our plans to move to our future-state architecture. This work will make it easier to integrate with us, allow us to expose existing and new products to market faster and scale them across our segments and geographies, while reducing complexity and cost over time. Our strategy also reflects a deliberate choice about how we serve our clients. Some providers in our industry have built single-stack models in which clients realize the full value of their tools only when they consolidate all of their processing onto one platform—in effect, a walled garden. We are taking a different approach. We are designing our products and value-added services to be modular, in many cases acquirer-agnostic, so clients can use them regardless of who processes their payments.

Through our curated open ecosystem, we combine our own differentiated capabilities with best-of-breed partner solutions to build tailored offerings—offerings that meet each client’s specific needs rather than asking clients to adapt to a one-size-fits-all model. Although we have an overarching company strategy, each of our lines of business has a distinct role in bringing it to life to their customer segments with the key priorities they are pursuing. In SMB, our priorities are to grow beyond payments with Genius as our platform to deliver software, payments, and value-added services, to accelerate our distribution advantage, and to excel at customer experience. In August, we hosted our inaugural Genius Conference, bringing together approximately 1,000 attendees.

The agenda showcased our full suite of Genius capabilities, our innovation roadmap, and our vision for the future of Genius. Genius is no longer a new initiative for us; rather, it is now the flagship offering for our SMB business. Genius World was a great opportunity to demonstrate to clients, partners, and prospects how far Genius has come since its launch in May of last year. Genius now serves clients across restaurants, retail, campuses, age-restricted verticals, professional services, and field services in a growing number of markets across North America and Europe.

Genius bookings more than doubled year over year during the quarter. Along the way, Genius has won marquee brands such as Subway, Carl’s Jr., Hardee’s, and the New Jersey Devils, as well as iconic venues and university campuses like the Prudential Center and the University of Illinois. We also recently secured new payments deployments with Compass Group in the Simmons Bank Liberty Stadium at the University of Memphis. Genius continues to win across the spectrum of customers from SMBs to large multi-unit operators as well.

During the quarter, Genius expanded to more than 100 additional 7 Brew locations, Pollo Tropical deployed Genius kiosks for all of its locations, and Jeremiah’s Italian Ice rolled Genius out across 90 additional locations. We also completed Genius deployment across CKE’s approximately 300 corporate locations, and its franchisee rollout will begin in the first quarter of 2027. And our distribution advantage continues to expand. Following a successful pilot with three of Worldpay’s financial institution partners, we began rolling out Genius across Worldpay’s financial institution channel in October, extending Genius to more than 30 strategic bank partners. During the quarter, we also entered the convenience store market, enhanced our appointments and vendor management modules, introduced a new loyalty solution for restaurants, and expanded our dual pricing, surcharging, and cash discounting capabilities.

Further, we completed integration of Genius with our TouchNet higher-education commerce platform, opening meaningful new opportunities in this vertical. Dalhousie University is an early win that is using Genius to create a more connected campus commerce experience. Internationally, we recently launched Genius in the Czech Republic to help clients prepare for new tax reporting requirements. We are launching Genius Mobile Pay in the Philippines and across several European markets over the next few quarters.

In Mexico, we are expanding Genius with the launch of our small business offering this quarter through both our direct sales force and our financial institution partners. Turning to our enterprise segment, our strategic priorities are to deliver superior core payment performance, expand acquirer-agnostic value-added services, and enable emerging verticals, business models, and technologies. Our modular approach resonates with both existing and new clients. We recently signed Air Serbia for all of its international traffic, leveraging our configurable offering including payments and a suite of value-added services.

We also recently went live with our credential management solution for one of the world’s largest consumer technology companies on a standalone basis, expanded our payments relationship with another hyperscaler client to include additional value-added services, and deepened our relationship with Athletics by cross-selling additional solutions. This quarter, NASCAR named us as its official merchant services provider, supporting ticketing and merchant services at 12 owned-and-operated racetracks across the United States, including the Daytona International Speedway, Phoenix Raceway, and Talladega Superspeedway.

As a leading payments infrastructure provider, we also won several emerging payments platforms, including CACTO in Brazil; South Korean cross-border payment service provider Eximpay; UK- and Australia-based omnichannel payments provider Latpay; US-based international money transfer provider Shaka Express; Asia-based global payment and monetization platform WAFO; and Norway-based B2B payments provider ZTL Payments Solution. We are continuing to enable new business models and markets in this segment.

We went live with Anai, the UAE’s account-to-account payments method, and completed our first point-of-sale pilot of Alipay+ at the Laver Cup in London. In Asia Pacific, we received regulatory approval from the Bank of Thailand, clearing our way for new client go-lives in the Thai market, including Centara Hotels and Resorts, and our payouts platform is now ready to pilot payments to PayPal and USDC stablecoin wallets. At the same time, we are extending our lead in payment performance.

The AI-powered intelligent decisioning within our Revenue Boost solution is now delivering a significant incremental uplift in approval rates, and it is ready for broader deployment across Europe and Asia Pacific following a North American pilot that began in October. Within platforms, our priorities are to aggressively pursue high-potential software partners with our embedded solutions, to drive adoption of new products and value-added services, and to accelerate our growth in international markets. During the third quarter, we signed 52 new software partners ahead of our plan, including strong momentum in the UK, Australia, and New Zealand. We’re also expanding the value-added services we deliver through our partners.

Real-time payments is now generally available on Dynamic Payouts, enabling our partners to offer instant funding to their customers, and we are extending capabilities such as fraud prevention, debit routing, and account updater across more of our partner base. And we are making it easier for partners to work with us. We’ve reduced average time to revenue for new partners by about one-third compared to 2025, and AI automation has cut the setup time for a new partner from weeks to minutes.

Zero-touch underwriting is also now generally available for our Payrix partners, simplifying onboarding and accelerating activation for their customers. Across our business, AI is not a corporate strategy; it is an enabler of everything that we do—from how we differentiate our products and improve the experiences we deliver to how we operate and prepare for emerging areas of commerce. We continue to enhance our platform-agnostic, modular set of capabilities that allow our clients to participate in new agentic commerce models regardless of channel, agent, or payment method, and we are helping to shape the standards for this channel.

As an inaugural member of the Payments Tech Council for Google’s Universal Commerce Protocol, or UCP, we are helping to define the payments roadmap across authentication, fraud, authorization, and disputes. Our clients are also beginning to move from pilots into production. Transactions through ChatGPT are now live on our platform in the U.S. from one of our largest clients, with more on the way. Within Genius, AI is at the center of our product innovation.

Genius AI is an agentic assistant that allows clients to ask questions in their own words and get instant answers from their own business data. In May, we unveiled our AI-first Genius handheld designed to run AI directly on the device so servers can have natural conversations with their customers while the order is built in the background. We are now piloting AI-powered drive-thru vision and order routing with several large QSR restaurant clients to increase throughput and improve visibility across multi-lane drive-thrus.

And we are adding additional capabilities to Genius AI with upcoming releases, moving beyond insights to help clients run their businesses—from smart menu and pricing updates to simplified, AI-powered configuration and setup for large multi-unit operators. We’re also increasingly leveraging AI to improve how we operate, making our business more efficient and effective while enabling our teams to execute with greater speed and precision. In Treasury, AI is helping us improve cash forecasting, anticipate currency exposures, and identify interchange savings opportunities. Across our commercial organization, AI models are identifying cross-sell opportunities, predicting churn risk, and prioritizing the highest-potential leads for our sales teams.

We’re also automating the ingestion and processing of chargeback information and disputes, while in underwriting, we have deployed an AI-enabled solution designed to reduce review times from roughly an hour to just 10 minutes, allowing us to significantly increase capacity without adding headcount. As we scale these capabilities across the organization, we expect AI to become an increasingly important driver of productivity, allowing us to operate with greater agility, scale more efficiently, and create additional structural opportunity for margin expansion over time.

Overall, our results this quarter and the progress each of our businesses is making against our strategy reinforce our confidence in the long-term opportunity ahead of us. With that, I’ll turn the call over to Josh to discuss our financial performance and outlook.

Josh Whipple (Chief Financial Officer)

Thanks, Cameron. In the third quarter we generated adjusted net revenue of $3.18 billion, representing growth of over 4% excluding dispositions. This performance reflects resilient consumer spending trends across our business, partially offset by the ongoing headwind to our travel customers from the conflict in the Middle East. Currency exchange rates had no impact on growth in the quarter. Adjusted operating margin was 2.5% in the third quarter, representing an expansion of 220 basis points excluding dispositions.

As we anticipated, margin expansion accelerated in the third quarter as we realized additional Worldpay integration cost synergies. The net result was adjusted earnings per share of $3.58, representing an increase of 10% in the third quarter. We continue to make substantial progress on the Worldpay integration. Among other accomplishments, we consolidated corporate applications and standardized our HR, finance, procurement and expense management processes across the combined company. Additionally, we further reduced management layers, renegotiated major technology and marketing vendor contracts to leverage our combined purchasing scale and continued to consolidate overlapping facilities.

As a result of this progress, we are increasing our total cost synergy expectation from $600 million to $650 million on an annualized run rate basis by the end of 2028. Turning to our segment results, we saw solid performance across each in the quarter, which reflects our execution against the priorities Cameron outlined. As a reminder, we report SMB, Enterprise and Platforms on a contribution margin basis with overhead costs reported in Corporate and Other. In the third quarter, SMB accelerated sequentially, generating adjusted net revenue of $1.55 billion, representing normalized growth of 5% excluding dispositions.

We delivered $928 million of adjusted operating income in the SMB segment, representing a contribution margin of 60%. Genius continued to build momentum during the quarter. The number of locations sold increased approximately 65% year over year. Among our larger multi‑unit restaurant clients, total Genius locations grew more than 10% sequentially. Yields on new Genius bookings expanded nearly 60% year over year, again demonstrating that our clients recognize the value of the solution.

Enterprise generated adjusted net revenue of $836 million, representing normalized growth of 8%. Enterprise volumes grew 10%, which included an approximately 200 basis point short‑term benefit associated with load testing for one of our largest clients. While the revenue impact was immaterial, we do not expect this to reoccur in the fourth quarter. Card‑Not‑Present revenue, which primarily represents global e‑commerce, grew 8% on a normalized basis.

We delivered $658 million of adjusted operating income in the Enterprise segment, representing a contribution margin of 79%. Commercial momentum in Enterprise remains strong. Bookings increased 23% year over year through the third quarter, with cross‑sells to existing clients a key driver, up 29% year to date, led by our modular value‑added services, particularly in the EMEA region. Our pipelines are robust and we continue to convert signed‑not‑live business into revenue.

Platforms generated adjusted net revenue of $625 million, representing normalized growth of 8%, and segment volume grew 11%. We delivered $279 million of adjusted operating income in the Platforms segment, representing a contribution margin of 45%. As Cameron noted, we saw strong new partner signings in the quarter, including in our international markets. Value‑added services revenue in Platforms grew 22% on a normalized basis and volume in our embedded payments business, which includes our Payfac and Payrix managed Payfac offerings, grew 16%.

We generated adjusted free cash flow of $870 million in the third quarter, representing a conversion rate of adjusted net income to adjusted free cash flow of approximately 92%. We invested $232 million in capital expenditures in the quarter, representing approximately 7% of adjusted net revenue. In addition, we returned more than $200 million to shareholders during the quarter, including buybacks and dividends, bringing our year‑to‑date capital returns to more than $1.4 billion.

Our balance sheet remains healthy. We ended the third quarter with approximately $6.3 billion of available liquidity and 3.4 times net leverage. Our indebtedness is more than 90% fixed rate with a weighted average cost of approximately 4%. With our third quarter results in line with our expectations, we are reaffirming our full year outlook. We continue to expect normalized constant‑currency adjusted net revenue growth of approximately 4% to 5% and normalized adjusted operating margin expansion of approximately 150 basis points for a full year 2026. We continue to expect adjusted earnings per share of $13.60 to $13.80, representing 11% to 13% growth, and we continue to expect currency exchange rates to have roughly no impact on reported growth for the full year.

Our outlook assumes a stable macro environment and a continuation of resilient consumer spending trends as we discussed on our second quarter call. Our outlook further assumes that the impact of the conflict in the Middle East on our Enterprise segment’s travel portfolio continues through the remainder of 2026. Travel in the region remains below pre‑conflict levels and we continue to believe this is the most prudent planning assumption. Regarding cash flow, we expect the conversion rate of adjusted net income to adjusted free cash flow to be approximately 90% for the full year 2026. Our capital allocation plans for 2026 and beyond remain unchanged. We continue to expect to return more than $2 billion to shareholders in 2026 through share repurchases and dividends while investing approximately $1 billion in the business, or approximately 8% of adjusted net revenue. Furthermore, we remain committed to preserving our investment grade credit ratings and achieving our 3 times net leverage target by the end of 2027.

To conclude, our third quarter results demonstrate the durability of our business model and the progress we are making as we execute our strategy. The team’s focus continues to be on commercial excellence across all our go‑to‑market channels and disciplined execution of our integration with Worldpay. We remain confident in our prospects for sustainable growth, cash flow generation and return of capital to shareholders. And with that, I’ll turn the call back over to Cameron.

Cameron Bready (President and CEO)

Thanks, Josh. As you heard this morning, we have taken important steps over the past year to strengthen and reposition Global Payments, and we have established a clear strategy to fully leverage the scale and capabilities of the combined company. Our ambition is to become the worldwide partner of choice for commerce solutions, and we will achieve that by delivering differentiated products and solutions, creating a distinctive experience for our clients and partners, and leveraging our immense scale and distribution.

We are already seeing our strategy come to life across our businesses. Genius is growing rapidly and reaching more clients through new channels, markets and verticals, our Enterprise business is winning with modular capabilities tailored to each client’s needs, and our Platforms business is making it easier for software partners to launch, grow and monetize payments and other value‑added services. And with approximately $1 billion in annual investment, we are among the few companies in our industry with the resources to innovate at scale, anticipating and delivering solutions ahead of demand.

At the same time, we remain focused on disciplined capital deployment and maximizing total shareholder return. We’re a proven earnings compounder with durable and diversified revenue streams and substantial free cash flow generation. Overall, our clear strategy, integration execution, innovation investments and disciplined capital deployment position Global Payments to deliver compelling long‑term shareholder value. Operator, please open the line for questions.

OPERATOR

Thank you. At this time, if you’d like to ask a question, please click on the raise hand button which can be found on the black bar at the bottom of your screen. When it is your turn, you will receive a message on your screen from the host allowing you to talk and then you will hear your name called. Please accept, unmute your audio and ask your question. As a reminder, we are allowing analysts one question and one related follow‑up today. We will wait a moment to allow the queue to form.

Our first question comes through from the line of Dan Doleb from Mizuho. Please go ahead with your question.

Dan Doleb (Analyst)

Hey guys, can you hear me?

Cameron Bready (President and CEO)

Yes, good morning, Dan, how are you?

Dan Doleb (Analyst)

Hey, good morning, good morning. Congratulations on fantastic Q3 results, and Cameron, I just had two questions, one question and one follow‑up, please. So obviously there was some news on Friday regarding the potential taking private. You know, what can you tell investors today? You know where we are? And then I have a very quick follow‑up. Thank you so much.

Cameron Bready (President and CEO)

Yeah, sure. Thanks, Dan. Look, I appreciate the question, certainly understand the need to ask it, but as you can imagine we don’t comment on market rumors or speculation. So I’m not really going to be able to get into the reporting or any of the specifics around it. What I can tell you is the board, the management team, everyone at Global Payments is keenly focused on and committed to creating long‑term value for our shareholders. And with that in mind, we’re very much focused on executing the strategy we laid out, integrating Worldpay, serving clients and partners very effectively and delivering against the financial and operating commitments that we’ve made publicly. So we feel really good about the business, we feel great about the progress we’re making and the long‑term value creation opportunity in front of us, and that’s what we’re focused on executing against.

Dan Doleb (Analyst)

Great, fair enough. And then I had a quick follow‑up, very exciting topic, which is the synergy, right—target raised from 600 to 650. I believe you talked about the target technology architecture model and how quickly you’re moving to make it easier for clients to integrate for existing and new products, reaching markets faster and reducing complexity. Can you elaborate on that a little bit more? Thank you.

Cameron Bready (President and CEO)

I’ll be happy to, Dan. And I’ll ask Bob maybe to chime in a little bit as well. I think you outlined in your question a lot of the core underpinnings of our technology architecture model and what we expect it to deliver for us as a strategic matter. But maybe if I step back and look at it at a macro level, I think the TAM and executing against the TAM is one of the single largest priorities we have that is a core underpinning of our strategy. Ultimately, we’ve really designed our TAM with the simple idea to make it easier for our clients and partners to be able to integrate with us and making the full breadth and depth of capabilities that we have more ubiquitously available to clients and partners around the globe.

At the front end, really, that means creating a simple, easy orchestration layer with a unified API environment so clients and partners can integrate once and access the full breadth of the capabilities that we can bring to bear. And then behind that, obviously we’re working very hard to simplify the underlying technology estate, really wanting to focus investments on the platforms that we see having the greatest strategic value for the business long term and ultimately positioning us to be able to retire redundant capabilities that sit within the architecture estate that we’re running today.

So as you, I think, correctly highlighted, strategically, that really does a few things for us. First, I think it increases our speed to market because it allows us to develop capabilities once and then distribute them more broadly across the entire estate. And then two, it certainly makes cross-selling easier. As you heard in my prepared remarks, value-added services and cross-selling value-added services into our existing base are the core underpinning of our strategy across each of our lines of business.

So making it easier to do that through a single integration point, a core underpinning of delivering the TAM. And then third, certainly consolidating the underlying estate of assets that we’re managing reduces complexity, which should allow us to drive better efficiency in our business and create operating leverage as we move forward. So if you look at the TAM and our ability to deliver the TAM, it’s clearly connected to the three key pillars of the strategy that I laid out in my commentary. It allows for us to harness the scale and capabilities of Global Payments. It allows us to deliver a differentiated experience to our clients, and it allows us to deliver new innovation and product capability to the market more quickly, ultimately again supporting what we’re trying to accomplish across each of our lines of business.

And as we think about the synergy raise, certainly our ability to deliver the TAM and the opportunity that we see financially in delivering the TAM is part of where we see the incremental value coming from. It will be more back-end loaded, obviously, as a TAM execution will take a period of time. But certainly as we looked at the raise of synergy targets from an expense perspective from 600 to 650, the opportunity that we think we can unlock through the TAM is a core driver of that incremental value that we think we can bring about through integration.

Dan Doleb (Analyst)

Great. Congrats again on fantastic results.

Cameron Bready (President and CEO)

Thanks, Dan.

OPERATOR

Thank you very much. Our next question comes through from the line of Brian Keane from Citigroup. Please go ahead and ask your question.

Brian Keane (Analyst)

Yeah. Hi guys. Good morning and congratulations on the solid execution.

Josh Whipple (Chief Financial Officer)

Thanks, Brian.

Cameron Bready (President and CEO)

Thanks, Brian.

Brian Keane (Analyst)

Just had one question on the quarter and then one question on the guide. I guess my first question, you know, revenue in SMB normalized, upticked a little bit and accelerated to 5% but volume slowed a touch to 3%. So that dynamic change and the yield increase. Just curious on the drivers there and then I have a follow-up on the guide.

Josh Whipple (Chief Financial Officer)

Yeah, thanks, Brian, it’s Josh. So look, as you think about SMB, you’re right, revenue growth is 5%, volumes were 3%. And what you’re seeing there is the difference between just greater adoption of value-added services, and we called this out in our prepared remarks. We saw 60% year-over-year increase with Genius yield. So that’s really driving the difference. The other thing I would say as you think about just SMB volumes more generally and the decel that we saw from Q2 to Q3, these were right in line with what the networks reported last week. Visa, I think, saw a step down of about 140 basis points and Mastercard, you know, 50 basis points on a sequential basis. So again, generally right in line with where the networks were. But the step function was primarily value-added services, again, 60% year-over-year increase from Genius yields.

Cameron Bready (President and CEO)

And Brian, it’s Cameron. The only thing I would add to that, just a bit more color. I would say as a volume matter, it’s really on the margin. There’s probably a little bit of rounding last quarter up, a little bit of rounding down this quarter. So I’d say it’s probably marginal at best. I would say where we did see a little bit of volume softness sequentially kind of Q2 to Q3 was more in the international markets, and those yields tend to be a little bit lower than they are here in the US market.

So as you look at the revenue composition versus the volume growth composition, some of it is due to just mix. And ultimately where we did see a little bit of volume softness, Europe and a touch more in Asia Pacific as well, those are slightly lower-yielding markets for us. So that contributes to the dynamic that you’ve called out.

Brian Keane (Analyst)

Awesome. And then just as a follow-up, thinking about the guidance and the acceleration of revenue growth or of organic revenue growth in the fourth quarter, just curious on some of the drivers of that acceleration and then hoping you can just quantify the impact of the Middle East. And then when we anniversary the official headwind as we get into next year. Thanks so much and congrats.

Josh Whipple (Chief Financial Officer)

Yeah, thanks, Brian. That’s a loaded question. So just a couple points on Q4 and the exit rate look. So, we continue to expect the second-half revenue growth to be in that approximately four and a half percent range overall. For the year we expect FX to be broadly neutral, and some of the key drivers are what we’ve been talking about. It’s the expansion and transformation of the sales force, a lot of the commercial go-to-market tools that we put in place around tooling, training and compensation.

It’s a continued Genius adoption and rollout and ramp—we continue to see very strong sequential trends there. And in Enterprise, we have clients that went live in Q3 that are now generating revenue. We have all these now live across both Europe and US. Point-of-sale rollout for Domino’s in Canada is now fully complete. And then moving to Platforms, we continue to go ahead and see really strong expansion into international markets and continue to see really strong trends with embedded payments which is growing double digits. So overall we’re seeing strong trends across those pieces of the business around bookings, cross-sell and value-added services. So those have been really, really strong and pleased with those.

For your third question as it relates to the Middle East, in the third quarter I’d say the Middle East was general expectations, the impact was less than 100 basis points. Travel in the Middle East obviously continues to be impacted by the conflict and volumes are still very much below the pre-conflict levels, and I’d say the recovery has been very uneven and inconsistent. However, we have seen a modest improvement from Q2, but we continue to see weakness in forward bookings, airlines ticket sales remain depressed, there’s fewer long haul commercial flights being purchased.

And one metric that we look at, Brian, is paying passengers and miles traveled in the region, and those continue to be down significantly relative to pre-conflict levels. And the capacity that has come back has been more the shorter-haul, lower-yielding routes. So again, I think based on the latest developments, the uncertainty that we continue to see in the region, we think that the revision that we provided last quarter was the prudent thing to do.

Cameron Bready (President and CEO)

And obviously, Brian, just maybe to the very last part of your question, that’ll all anniversary in the first quarter of next year. And obviously we remain hopeful that the situation in the Middle East resolves itself sooner than that. But certainly as a financial matter we’ll lap it as we get towards the end of the first quarter.

Brian Keane (Analyst)

Great, thanks so much.

Cameron Bready (President and CEO)

Thanks, Brian.

OPERATOR

Thank you. Our next question comes through the line of Darren Pellen from Wolfe Research. Please go ahead and ask your question.

Darren Pellen (Analyst)

Hey guys, thanks for the time and—

Nate Rozoff (Senior Vice President, Investor Relations)

Still there.

Darren Pellen (Analyst)

Yeah. Hear me now?

Nate Rozoff (Senior Vice President, Investor Relations)

Yeah, we can. Sorry, we lost you for a second.

Darren Pellen (Analyst)

Okay, you hear me now? Okay. It was good to see the seven and a half billion capital return expected reiterated through the end of ’27. Maybe we could just talk a little bit and dive in a little more on the free cash levels and the expectation there. You know, I know you guys have the gain on sale tax payments being made. Those really are one time in nature through this quarter and a couple more. I think we have around almost 4 billion of adjusted free cash, and if our math is right, you’re expecting to return and buy back about $4 billion in 2027.

So can you just A) walk us through the bridge on free cash, make sure we’re on the same page, and then B) just make sure we understand the reiteration of the numbers, that we have it right on the buyback.

Josh Whipple (Chief Financial Officer)

Yeah, sure, Darren, this is Josh. Let me go ahead and take that. So look, if you think about, if you go back to September 2024, Investor Day, we said we were going to return approximately billion of capital to shareholders over the three-year period. And look, by the end of 2026 we will have returned approximately 3 billion of capital, leaving approximately 4 billion for next year. And keep in mind that in 2024 we pointed out we had elevated one-time costs, we had cash taxes on the gain of sale of Issuer, and those aren’t going to repeat next year.

And simultaneously we were able to go ahead and return 2 billion of capital, or we will return a total of 2 billion of capital this year. So additionally we expect the one-time expenses to trend down as the integration progresses. So, you know, based on this, we have a lot of confidence that we’re on track to go ahead and return approximately 7 billion of capital next year and be able to get our leverage point back down to that three times by 2027.

So that’s how you get there.

Darren Pellen (Analyst)

All right, thanks for that, Cameron. Can I just follow up quickly on Genius? Obviously really good numbers, although still a pretty small base. But the distribution channel continues to look like it’s primed and getting ready to sell more into 27. Specifically the FI channel which I think wasn’t really yet onboarded with Genius up until probably very recently. So let me just touch for a minute. I’m sure you’ll get options on Genius, but for right now at least just the go-to-market, how the channels prepared sales, REC sales, whether it’s ISO direct sales or now the FI channel, where you stand on that and, you know, if that could be pretty incremental going to next year. Thank you.

Cameron Bready (President and CEO)

Yeah, it’s a really good question, Darren, and thanks for asking. Naturally we’re very proud of the progress that we’ve made with Genius. You know, just reflecting back that we just launched the capability and the platform not even a year and a half ago in May of 2025 and sort of where we’ve come over that period of time. Again, I think our team deserves an enormous amount of credit for the effort and energy and vision behind bringing Genius to life.

So with that preamble, our goal now is to really find more ways to get better penetration and saturation of Genius into market. And that comes down to lighting up breadth and depth of distribution capabilities that we have here in the U.S. market, but also in markets outside of the U.S. around the globe. Here in the U.S., our priority from day one, post close of the merger, was really to light up the Worldpay direct salesforce, which is relatively small, to be able to sell Genius almost immediately in the market.

And we did that within weeks, I would say, of closing the merger with Worldpay. Our second focus then was really turning on the FI channel within Worldpay, roughly 6,000 branches across dozens of FI partners. And we really started that in earnest in Q3. We did a pilot with three FI partners, and then recently in October, we’ve opened it up to 30 FI partners in the U.S. market. So to your point, as we get into 27, opening up that new distribution channel, we expect to drive incremental momentum behind Genius in our ability to continue to grow and scale Genius from there.

Once we’re successful and we demonstrate we can scale within the FI channel, we’re going to focus more deliberately on our wholesale partners — so ISOs, agents, other indirect partners who want to be able to sell Genius into the marketplace, either as a dealer or ultimately have some sort of referral agreement with us to sell Genius. That’s kind of the next opportunity from a distribution perspective, while in parallel, as I said before, we look to continue to bring it to new markets around the globe.

And we’re really trying to sequence those, largely dependent upon where we see good, strong product-market fit, where we see an opportunity to drive scale in a market, where we see maybe other externalities being an opportunity for us to get better penetration. I would say the fiscalization program in the Czech Republic is a good example of that. So ultimately, it’s a dual-prong strategy of tapping into all the distribution channels we have in the U.S. and targeted deployment to new markets outside the U.S., again looking to continue to drive momentum around Genius more broadly.

Darren Pellen (Analyst)

All right, that’s great. Thanks, Cameron. Thanks, guys.

Cameron Bready (President and CEO)

Thanks, Darren.

OPERATOR

Thank you. Our next question comes through from the line of Andrew Schmidt from KeyBank. Please go ahead and ask your question.

Andrew Schmidt (Analyst)

Thank you. Hey, Cameron and Josh, good to see the steady progress here. Thanks for taking the question. Maybe just a question on the synergies. Just, you know, as you continue to realize these additional synergies, including the increase, how should we think about the balance between reinvestment and margin? And I know we’ve talked about, you know, reinvestment over time. You have that, you know, 1 billion marker out there. But maybe just talk about, you know, as you sort of realize the additional, just the biggest opportunities, kind of redeploy those savings to support longer-term growth.

Thanks so much.

Cameron Bready (President and CEO)

Yeah, it’s a great question, Andrew. Maybe I’ll start. I might ask Bob to chime in on this as well. Look, I think we’re always focused on striking the right balance in terms of making sure that the value we’re able to generate through operating leverage in the business, obviously through the realization of synergies from the Worldpay integration, the benefits that we’ve been able to drive through our transformation program the last couple years — you know, we’re trying to strike the right balance between making sure that we’re deploying the right amount of capital and investment in the business to drive durable growth while also meeting our capital return commitments that we’ve made and obviously getting our leverage back to our targeted leverage ratio as Josh called out earlier.

So I don’t think that changes as we continue to move forward in time. We’ll continue to make sure that we’re putting capital and putting investment behind bringing strategy to life. I think we outlined that pretty clearly today — what our priorities are, how we think about delivering them across each of our lines of business. That’ll be a key driver of capital investment. We need to continue to prioritize investing against our TAM because, as I said earlier, that’s a core underpinning of our strategy and our ability to deliver on that strategy.

And ultimately, again, we want to make sure we’re using our capital efficiently in terms of returns for shareholders and meeting the commitments that we’ve already established. So we work hard to strike that right balance. I think we have a very prudent, disciplined approach to capital allocation in the business. And, you know, whether we’re generating incremental synergies or not, I think that doesn’t really change how we think about, you know, again, making sure we’re balancing investing in the business but also returning capital and driving a total shareholder return that we believe our shareholders will find attractive.

Bob, I don’t know if there’s anything you would add just on the investment front.

Robert Cortopassi (President and COO)

Only one — maybe I would double down on the point we’ve already made about the target architecture model. This isn’t really just an integration or a technology modernization journey. This is ultimately business-led and an enabler for growth. So to the extent that we can accelerate progress against the TAM initiatives, that drives incremental performance and opportunities for our three lines of business. So I think, you know, to Cameron’s point of balanced capital allocation, that’s certainly true.

But in a world where we have the opportunity to accelerate our performance and deliver for our clients more quickly, we would certainly look to do that.

Andrew Schmidt (Analyst)

I appreciate that. Thank you, Cameron. And Bob, that’s a great segue into the next question I wanted to ask about sort of transformation milestones in the next 12 months. Made a lot of progress integrating the organizations, advancing the product roadmap. Maybe just talk about — you talked about sort of accelerating the progress here — but maybe talk about what we should expect from milestones next 12 months, particularly around the technology platform consolidation, and then just looking externally, you know growth is obviously the North Star, but what should we look for externally to gauge progress?

Thanks so much.

Cameron Bready (President and CEO)

Yeah, another good question, Andrew, and I appreciate you borrowing language I’ve used in the past around growth being the North Star for our integration efforts with Worldpay. I’m going to actually just maybe use your question as an opportunity to reflect on progress we’ve made, and I’m going to ask Bob maybe to get to the heart of your question about what to expect as a go-forward matter, particularly around technology modernization as we execute against our TAM strategy.

We’re 10, 11 months into — 10 months into — our merger with Worldpay, and I’m enormously proud of the progress that our organization’s been able to make. And I really want to sort of anchor that commentary around the work we’ve done to ensure that we’re building the right foundation for the future of Global Payments. You know, you only get one opportunity, I think, to build the strong foundation that we feel we need for the future, and trying to build the foundation after the fact is always hard.

So we put a lot of emphasis, and our highest priority I think has been focused on building the right foundation for the business. In this short period of time, we realigned all of our go-to-market activities around customer segment-led channels — SMB, platforms, and enterprise. We’ve established the combined leadership structure for the entire organization and aligned our entire company and all of our team members against that leadership structure. And as part of that we placed 2,400 leaders as part of a very deliberate best-of-both approach to how we establish the combined leadership team for the new Global Payments.

And, you know, we defined the TAM, which is critical to delivering on the opportunities that exist for our business in the future for reasons we’ve talked about today, and we’ve actually started to lay the groundwork for delivering on that TAM as well. And also, you know, we have clear line of sight to every single dollar of synergies that we have targeted as part of this merger and very rigorous execution plans to make sure that we deliver on those.

And we’ve been able to, obviously, increase our target around expense synergies over that period of time. So I think that speaks to the amount of effort and focus and execution discipline that’s gone into getting us to today. And with that I’ll maybe transition over to Bob to let him talk about what to expect as we look towards 27 and beyond.

Robert Cortopassi (President and COO)

Yeah, thanks, Cameron. Andrew, great question. We could probably talk for the remainder of our time just about this one topic, but I’ll try to be brief. I think if you distill what Cameron just said about the target architecture model, the integration approach with Worldpay, and then think about the comments in Cameron’s prepared remarks about our modular, kind of open ecosystem approach — curated open ecosystem approach — to capabilities, that’s where you’re going to see the milestones over the next kind of 12 to 24 months.

Continuing to expand our single end capabilities to more customer demographics, whether those are geographies or customer archetypes, partners of various flavors as well as our enterprise and SMB clients. Delivering all of those through a single experience — one portal where you can not only consume value-added services but you can also get AI-driven insights about your business, support the decision-making that needs to happen, and then continuing to make available the value-added services — whether those are payments-specific or parts of our embedded finance engine or things like that — across the entire estate.

So, you know, a couple of early proof points I think we already talked about in prior quarters: how quickly we were able to make Genius available through the Worldpay sales channels. That also meant Genius on heritage Worldpay processing platforms. We’ve done the same in reverse in bringing tools like FraudSight and Revenue Boost to merchants in the Global Payments ecosystem, and we’ll continue to do that over the coming years so that, more and more, what clients experience from Global Payments is one entry into the ecosystem, the flexibility to construct a modular set of solutions that’s tailor-made for their use cases, and one experience dealing with a company — its products and platforms and the service experiences that matter to them.

Andrew Schmidt (Analyst)

Very helpful. Appreciate all the work. Thank you very much.

Cameron Bready (President and CEO)

Thanks, Andrew.

OPERATOR

Thanks. Thank you. Our next question comes to you from David Codin from Baird and Co. Please unmute and ask your question.

David Codin (Analyst)

Yeah, thanks guys. I just wanted to ask about agentic. It gets brought up on a lot of calls and, you know, for you it’s one thing if a human transaction is just replaced by an agentic transaction, but it’s another thing if you have more transactions, maybe better yields, maybe more new BAS services. So just wondering what the economic impact and how you think that’s going to play out.

Cameron Bready (President and CEO)

Yeah, Dave, great question and obviously very topical given everything we see happening in the market around this exciting new, I’d say, channel for commerce as we go forward. Maybe I’ll just start and I’ll ask Bob to get into a little more of the specifics as it relates to your question. I think it’s helpful maybe to frame up how we think about agentic commerce and how we’re trying to position ourselves around agentic commerce. And I would say the positioning really starts with two things from our vantage point.

One is, you know, our approach really is centered around being a merchant advocate to ensure that the agentic protocols that develop in the marketplace are really developed in a way that aligns with the best interests of our clients. That’s sort of anchor point number one for us. Anchor point number two is for agentic commerce to really be able to scale and become a more meaningful driver of retail commerce going forward. There has to be trust in the ecosystem in terms of how these transactions are getting effectuated and how consumers are going to be protected, and to that extent merchants are protected around this type of commerce activity.

So I would say at a very high level, our strategy is really anchored around building a platform-agnostic, modular set of capabilities that allow our clients to participate in agentic commerce models regardless of the channel or agent or payment method. And we’re very focused on making sure we’re helping to develop the right standards in a way that again are really aligned with the best interests of our clients. The other thing we’re focused on doing at the SMB level is providing them the on-ramps to be able to access this new emerging channels.

They actually, you know, not surprisingly, they don’t have the technology resources, the investment capacity to build their own infrastructure to be able to participate in agentic commerce. And I think part of our role is to help them to be able to access that opportunity without having to make a significant amount of investment on their part. But as it relates to more specifically what it means, I’ll ask Bob to maybe chime in on, you know, what exactly we’re doing and how we see the economics and flows, you know, kind of working as we go forward.

Robert Cortopassi (President and COO)

Yeah, Dave, I think the way that we think about it today is a lot like e-commerce. When it emerged there were questions about is this incremental capacity in the economy or is this a displacement of physical, in-person, face-to-face commerce? And I think the answer to both of those questions was yes, it’s both of those things. And agentic looks a lot like that. There’s a need for discovery, there’s need for acceptance tokens, fraud screening, authentication, dispute evidence.

Certainly in the agentic commerce report that we released recently, people are more open to transacting with agents. But, you know, 60%, give or take, still want to approve every purchase. So we see trust really as the gating factor. So to the extent that transaction volume is incremental, that would be a tailwind for us and a benefit. But I also think to your point, there is opportunity to add value-added services into this stack and this trust component is one that continues to be at the center of scale and adoption for agentic: verifying the intent of the consumer, verifying the credentials used to complete the transaction, and then ensuring that all of the sort of consumer protections and merchant protections continue to be built into the ecosystem that already exist for card rails today.

That’s where we’re focused in adding value is not only just benefiting from these transactions crossing our rails like they do today, but also those incremental value-added services around identity, intent, fraud, and optimizing authentication performance for our particularly enterprise clients, but increasingly mid-market and SMB as well.

David Codin (Analyst)

Yeah, thanks guys.

OPERATOR

Thank you. Our next question comes through from the line of Jason Cooperberg from Wells Fargo. Please go ahead and ask your question.

Jason Cooperberg (Analyst)

Hi guys, good morning. It’s great to