Fidelity National Information Services, Inc 8-K/A, filed Feb 24, 2026
Fidelity National Information Services, Inc. (FIS)
About this 8-K/A
Fidelity National Information Services, Inc filed this 8-K/A on February 24, 2026, reporting on events of January 12, 2026.
Items reported
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Amendment No. 1)
CURRENT REPORT
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Introductory Note.
On January 12, 2026, Fidelity National Information Services, Inc., a Georgia corporation (“FIS”), filed a Current Report on Form 8-K with the Securities and Exchange Commission (the “Original 8-K”), which reported that on January 9, 2026, FIS completed its previously announced (i) acquisition of the Issuer Solutions business (the “Issuer Solutions Business”) from Global Payments Inc., a Georgia corporation (“Global Payments”) and (ii) sale of all of its equity interests in Worldpay Holdco, LLC, a Delaware limited liability company (“Worldpay”), pursuant to the transaction agreement, entered into on April 17, 2025, by and among FIS, Global Payments, Total System Services LLC, a Delaware limited liability company and Worldpay.
This Current Report on Form 8-K/A (“Amendment No. 1”) amends Item 9.01 of the Original 8-K to include the financial statements and pro forma financial information required by Item 9.01 of Form 8-K. This Amendment No. 1 should be read in conjunction with the Original 8-K. Except as set forth herein, no modifications have been made to information contained in the Original 8-K.
| Item 9.01 | Financial Statements and Exhibits. |
| (a) | Financial Statements of Business Acquired. |
The audited combined financial statements of the Issuer Solutions Business as of and for the years ended December 31, 2025 and 2024, and the notes related thereto, are filed as Exhibit 99.1 hereto and are incorporated herein by reference.
| (b) | Pro Forma Financial Information. |
The unaudited pro forma condensed combined financial information of FIS as of and for the fiscal year ended December 31, 2025, and the related notes thereto, are filed as Exhibit 99.2 hereto to this Amendment No.1 and are incorporated herein by reference.
(d) Exhibits
Exhibit |
Description | |
| 23.1 | Consent of Deloitte & Touche LLP, independent auditors (with respect to the audited combined financial statements of the Issuers Solutions Business). | |
| 99.1 | Audited combined financial statements of the Issuer Solutions Business as of and for the years ended December 31, 2025 and 2024, and the notes related thereto. | |
| 99.2 | Unaudited pro forma condensed combined financial information of FIS as of and for the fiscal year ended December 31, 2025, and the related notes thereto. | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). | |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: February 24, 2026 | Fidelity National Information Services, Inc.
(Registrant) | |||||
| By: | /s/ James Kehoe | |||||
| Name: | James Kehoe | |||||
| Title: | Chief Financial Officer | |||||
| By: | /s/ Alexandra Brooks | |||||
| Name: | Alexandra Brooks | |||||
| Title: | Chief Accounting Officer | |||||
Exhibit 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in Registration Statement Nos. 333-132844, 333-132845, 333-162262, 333-206214, 333-230858, and 333-266198 on Form S-8 and No. 333- 288198 on Form S-3 of Fidelity National Information Services, Inc. of our report dated February 20, 2026, relating to the financial statements of Issuer Solutions Business appearing in this Current Report on Form 8-K/A dated February 24, 2026.
| /s/ Deloitte & Touche LLP |
| Atlanta, Georgia |
| February 24, 2026 |
Exhibit 99.1
INDEPENDENT AUDITOR’S REPORT
To Issuer Solutions Business
Opinion
We have audited the combined financial statements of Issuer Solutions Business (the “Business”), which comprise the combined balance sheets as of December 31, 2025 and 2024, and the related combined statements of income, comprehensive income, invested equity, and cash flows for the years then ended, and the related notes to the combined financial statements (collectively referred to as the “financial statements”).
In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Business as of December 31, 2025 and 2024, and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinion
We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Business and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Business’ ability to continue as a going concern for one year after the date that the financial statements are available to be issued.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with GAAS, we:
| • | Exercise professional judgment and maintain professional skepticism throughout the audit. |
| • | Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. |
| • | Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Business’ internal control. Accordingly, no such opinion is expressed. |
| • | Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. |
| • | Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Business’ ability to continue as a going concern for a reasonable period of time. |
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
/s/ Deloitte & Touche LLP
Atlanta, Georgia
February 20, 2026
Issuer Solutions Business
Combined Statements of Income
(in thousands)
| Years Ended December 31, | ||||||||
| 2025 | 2024 | |||||||
| Revenues |
$ | 2,548,388 | $ | 2,440,165 | ||||
| Operating expenses: |
||||||||
| Cost of service |
1,797,540 | 1,822,429 | ||||||
| Selling, general and administrative |
564,911 | 486,772 | ||||||
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| 2,362,451 | 2,309,201 | |||||||
| Operating income |
185,937 | 130,964 | ||||||
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| Interest and other income |
9,005 | 17,707 | ||||||
| Interest and other expense |
(28,831 | ) | (32,887 | ) | ||||
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| (19,826 | ) | (15,180 | ) | |||||
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| Income before income taxes and equity in income of equity method investments |
166,111 | 115,784 | ||||||
| Income tax expense |
18,999 | 15,510 | ||||||
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| Income before equity in income of equity method investments |
147,112 | 100,274 | ||||||
| Equity in income (loss) of equity method investments, net of tax |
(101 | ) | 319 | |||||
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| Net income |
$ | 147,011 | $ | 100,593 | ||||
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The accompanying notes are an integral part of the Combined Financial Statements.
1
Issuer Solutions Business
Combined Statements of Comprehensive Income
(in thousands)
| Years Ended December 31, |
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| 2025 | 2024 | |||||||
| Net income |
$ | 147,011 | $ | 100,593 | ||||
| Other comprehensive income (loss): |
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| Foreign currency translation adjustments |
74,495 | (26,022 | ) | |||||
| Income tax benefit (loss) related to foreign currency translation adjustments |
(2,869 | ) | 1,048 | |||||
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| Other comprehensive income (loss) |
71,626 | (24,974 | ) | |||||
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| Comprehensive income |
$ | 218,637 | $ | 75,619 | ||||
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The accompanying notes are an integral part of the Combined Financial Statements.
2
Issuer Solutions Business
Combined Balance Sheets
(in thousands)
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| ASSETS |
||||||||
| Current assets: |
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| Cash and cash equivalents |
$ | 441,414 | $ | 283,288 | ||||
| Accounts receivable, net |
333,142 | 292,766 | ||||||
| Settlement processing assets |
183,263 | 29,543 | ||||||
| Prepaid expenses and other current assets |
292,929 | 254,359 | ||||||
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| Total current assets |
1,250,748 | 859,956 | ||||||
| Goodwill |
8,923,348 | 8,925,537 | ||||||
| Other intangible assets, net |
3,827,679 | 3,336,873 | ||||||
| Property and equipment, net |
1,030,771 | 864,554 | ||||||
| Deferred income taxes |
14,584 | 7,884 | ||||||
| Due from Parent |
— | 82,674 | ||||||
| Other noncurrent assets |
619,374 | 635,985 | ||||||
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| Total assets |
$ | 15,666,504 | $ | 14,713,463 | ||||
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| LIABILITIES AND INVESTED EQUITY |
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| Current liabilities: |
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| Current portion of long-term debt |
$ | 96,846 | $ | 66,974 | ||||
| Accounts payable and accrued liabilities |
321,680 | 254,371 | ||||||
| Settlement processing obligations |
404,477 | 99,485 | ||||||
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| Total current liabilities |
823,003 | 420,830 | ||||||
| Long-term debt |
49,218 | 105,984 | ||||||
| Deferred income taxes |
250,788 | 57,538 | ||||||
| Due to Parent |
136,428 | — | ||||||
| Other noncurrent liabilities |
113,175 | 77,382 | ||||||
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| Total liabilities |
1,372,612 | 661,734 | ||||||
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| Net Parent investment |
14,290,476 | 14,119,939 | ||||||
| Accumulated other comprehensive income (loss) |
3,416 | (68,210 | ) | |||||
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| Total invested equity |
14,293,892 | 14,051,729 | ||||||
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| Total liabilities and invested equity |
$ | 15,666,504 | $ | 14,713,463 | ||||
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The accompanying notes are an integral part of the Combined Financial Statements.
3
Issuer Solutions Business
Combined Statements of Cash Flows
(in thousands)
| Years Ended December 31, | ||||||||
| 2025 | 2024 | |||||||
| Cash flows from operating activities: |
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| Net income |
$ | 147,011 | $ | 100,593 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: |
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| Depreciation and amortization of property and equipment |
118,624 | 123,566 | ||||||
| Amortization of acquired intangibles |
510,829 | 442,469 | ||||||
| Amortization of capitalized contract costs |
26,470 | 18,247 | ||||||
| Share-based compensation expense |
39,111 | 36,655 | ||||||
| Provision for operating losses and credit losses |
2,273 | 10,944 | ||||||
| Noncash lease expense |
14,682 | 7,007 | ||||||
| Deferred income tax expense (benefit) |
4,409 | (12,548 | ) | |||||
| Equity in loss (income) of equity method investments, net of tax |
101 | (319 | ) | |||||
| Technology asset charge |
— | 55,808 | ||||||
| Other, net |
3,499 | (3,445 | ) | |||||
| Changes in operating assets and liabilities: |
||||||||
| Accounts receivable |
(34,140 | ) | 17,236 | |||||
| Due from Parent, net |
219,103 | 70,449 | ||||||
| Prepaid expenses and other assets |
2,178 | (53,854 | ) | |||||
| Accounts payable and other liabilities |
63,469 | (32,914 | ) | |||||
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| Net cash provided by operating activities |
1,117,619 | 779,894 | ||||||
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| Cash flows from investing activities: |
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| Capital expenditures |
(211,791 | ) | (171,556 | ) | ||||
| Proceeds from sale of investments |
— | 6,632 | ||||||
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| Net cash used in investing activities |
(211,791 | ) | (164,924 | ) | ||||
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| Cash flows from financing activities: |
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| Changes in settlement processing assets and obligations, net |
144,413 | 30,030 | ||||||
| Changes in funds held for customers |
(307 | ) | 2,031 | |||||
| Repayments of long-term debt |
(97,242 | ) | (114,136 | ) | ||||
| Net transfers to Parent |
(812,620 | ) | (443,632 | ) | ||||
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| Net cash used in financing activities |
(765,756 | ) | (525,707 | ) | ||||
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| Effect of exchange rate changes on cash and cash equivalents |
18,054 | 8,293 | ||||||
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| Increase in cash and cash equivalents |
158,126 | 97,556 | ||||||
| Cash and cash equivalents, beginning of the period |
283,288 | 185,732 | ||||||
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| Cash and cash equivalents, end of the period |
$ | 441,414 | $ | 283,288 | ||||
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The accompanying notes are an integral part of the Combined Financial Statements.
4
Issuer Solutions Business
Combined Statements of Invested Equity
(in thousands)
| Net Parent Investment |
Accumulated Other Comprehensive Income (Loss) |
Total Invested Equity |
||||||||||
| Balance at December 31, 2023 |
$ | 14,406,168 | $ | (43,236 | ) | $ | 14,362,932 | |||||
| Net income |
100,593 | — | 100,593 | |||||||||
| Other comprehensive loss |
— | (24,974 | ) | (24,974 | ) | |||||||
| Net transfers to Parent |
(386,822 | ) | — | (386,822 | ) | |||||||
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| Balance at December 31, 2024 |
$ | 14,119,939 | $ | (68,210 | ) | $ | 14,051,729 | |||||
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| Net income |
147,011 | — | 147,011 | |||||||||
| Other comprehensive income |
— | 71,626 | 71,626 | |||||||||
| Net transfers from Parent |
23,526 | — | 23,526 | |||||||||
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| Balance at December 31, 2025 |
$ | 14,290,476 | $ | 3,416 | $ | 14,293,892 | ||||||
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The accompanying notes are an integral part of the Combined Financial Statements.
5
Notes to Combined Financial Statements
Note 1 - Basis of Presentation and Summary of Significant Accounting Policies
Introduction
These combined financial statements present the historical combined results of operations, financial positions, and cash flows for the Issuer Solutions Business (the “Business”). The Business previously comprised substantially all of the Issuer Solutions reportable segment of Global Payments Inc. (the “Parent”). Throughout the years ended December 31, 2025 and 2024, the Business operated as part of the Parent and did not operate as a separate, standalone entity.
The Business
The Business provides financial institutions and retailers technologies to manage their card portfolios, reduce technical complexity and overhead and offer a seamless experience for cardholders on a single platform. The Business also offers complementary services including account management and servicing, fraud solution services, analytics and business intelligence, cards, statements and correspondence, customer contact services and risk management solutions.
References to “we,” “us,” and “our” in these combined financial statements are to the Business, unless the context otherwise requires.
Sale of the Business
On April 17, 2025, the Parent entered into a definitive agreement with Fidelity National Information Services, Inc. (“Purchaser”) to sell the Business in exchange for cash consideration and ownership in a separate business. The agreement specified certain legal entities, assets and liabilities to be transferred. These combined financial statements include the operations confined to the legal entities to be transferred. Prior to the close of the sale transaction, certain restructuring activities were necessary to align the assets and liabilities to be transferred with these legal entities. Consequently, certain items included in these combined financial statements may not be transferred as part of the transaction, and, conversely, some elements that will transfer have not been included in these combined financial statements. The transaction closed on January 9, 2026. The consideration is subject to customary working capital and other adjustments. The Parent will provide certain transition services to the Purchaser to support the integration of the Business.
Basis of Presentation
These combined financial statements are presented in accordance with accounting principles generally accepted in the United States (“GAAP”) and are derived from the Parent’s accounting records to present the Business on a stand-alone, “carve-out” basis as if the operations of the Business had been conducted independently from the Parent. Such presentation requires certain assumptions, estimates, and allocations. Accordingly, the combined financial statements may not be indicative of the Business’ results of operations, financial position or cash flows had it been a separate, stand-alone entity during the periods presented, and they may not be indicative of what the Business’ results of operations, financial position and cash flows may be in the future. Our invested equity balance in these combined financial statements represents the excess of assets over liabilities, including the due to/from balances between us and the Parent (net Parent investment) and accumulated other comprehensive loss. Net Parent investment is primarily affected by contributions from the Parent, which are the result of treasury activities, and net funding provided by or distributed to the Parent. Foreign currency translation adjustments recognized during the years ended December 31, 2025 and 2024 are based on currency movements specific to our combined financial statements. The net effect of the settlement of transactions between the Parent and the Business during the periods that have not been historically cash settled is reflected in net transfers to Parent in the combined statements of invested equity, in net transfers to Parent in the cash flows from financing section of the combined statements of cash flows and as a component of the net Parent investment in the combined balance sheets. Net Parent investment represents the net amount of financial resources provided to or by the Parent from or to the Business. The income tax amounts in the combined financial statements have been determined using a separate return method and presented as if our operations were separate taxpayers in the respective jurisdictions.
The combined statements of income include all revenues and expenses directly attributable to the Business, as well as an allocation of general corporate expenses from the Parent on a systematic and rational basis. The combined balance sheets also include certain employee-related liabilities that have historically been held by the Parent, but which are specifically identifiable and attributable to the Business.
6
All intercompany transactions and accounts within the Business’ combined entities have been eliminated. Transactions between the Business and the Parent are discussed in “Note 12 - Relationship with Parent and Other Related Parties.”
Use of estimates
The preparation of financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reported period, including allocations from the Parent. Actual results could differ materially from those estimates. In particular, uncertainty resulting from global events and other macroeconomic conditions are difficult to predict at this time, and the ultimate effect could result in additional charges related to the recoverability of assets, including financial assets, long-lived assets and goodwill and other losses. These combined financial statements reflect the financial statement effects based upon management’s estimates and assumptions utilizing the most currently available information.
Recently adopted accounting pronouncements
ASU 2023-09 - In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, “Income Taxes (Topic 740): Improvement to Income Tax Disclosures,” which is intended to enhance the transparency and decision usefulness of income tax information through improvements to income tax disclosures, primarily related to the rate reconciliation and information regarding income taxes paid. We adopted ASU 2023-09 on a prospective basis effective January 1, 2025. The adoption resulted in expanded disclosures of the components of the reconciliation between income tax expense and statutory expectations as well as expanded disclosures of income taxes paid. See “Note 8 - Income Tax” for further information.
Recently issued accounting pronouncement not yet adopted
ASU 2025-06 - In September 2025, the FASB issued ASU 2025-06, “Targeted Improvements to the Accounting for Internal-Use Software,” which simplifies the capitalization guidance by removing all references to software development project stages, so that the guidance is neutral to different software development methods. The amendments in this update are effective for annual periods beginning after December 15, 2027. Early adoption is permitted. The amendments should be applied either retrospectively, prospectively to software costs incurred after the adoption date or on a modified prospective basis. We are evaluating the potential effects of ASU 2025-06 on our combined financial statements and related disclosures.
ASU 2024-03 - In November 2024, the FASB issued ASU 2024-03, “Disaggregation of Income Statement Expenses,” which requires disclosure in the notes to financial statements of specified information about certain costs and expenses. The amendments in this update are effective for fiscal years beginning after December 15, 2026. Early adoption is permitted. The amendments should be applied either prospectively to financial statements issued for reporting periods after the effective date of this update or retrospectively to any or all prior periods presented in the financial statements. We are evaluating the potential effects of ASU 2024-03 on our combined financial statements.
Revenue recognition
At contract inception, we assess the goods and services promised in our contracts with customers and identify a performance obligation for each promise to transfer to the customer a good or service that is distinct. In accordance with the FASB’s Accounting Standards Codification (“ASC”) 606, we recognize revenue when a customer obtains control of promised goods and services. The amount of revenue recognized reflects the consideration to which we expect to be entitled to receive in exchange for these goods and services.
Our revenues are primarily derived from long-term contracts with financial institutions and other financial service providers. The customer contracts typically include an obligation to provide processing services to those customers. Payment processing services revenues are generated primarily from charges based on the number of accounts on file, transactions and authorizations processed, statements generated and/or mailed, managed services, cards embossed and mailed, and other processing services for cardholder accounts on file. Most of the customer contracts have prescribed annual minimums, penalties for early termination, and service level agreements that may affect contractual fees if specific service levels are not achieved. We have determined that these processing services represent a stand-ready obligation comprising a series of distinct days of services that are substantially the same and have the same pattern of transfer to the customer.
7
Our contracts may also include additional performance obligations relating to loyalty redemption services and other professional services. Similar to processing services, we have determined that loyalty redemption services represent a stand-ready obligation comprising a series of distinct days of service that are substantially the same and have the same pattern of transfer to the customer. Professional services performance obligations are satisfied over time. For professional services, we recognize revenue based on the labor hours incurred for time and materials projects or on a straight-line basis for fixed-fee projects.
To the extent a contract includes multiple promised services, we must apply judgment to determine whether promised services are capable of being distinct and are distinct in the context of the contract. If these criteria for being distinct are not met, the promised services are combined and accounted for as a single performance obligation.
The performance obligations to provide processing services and loyalty redemption services include variable consideration. The variable consideration for our services is usage-based and, therefore, it specifically relates to our efforts to satisfy our services performance obligation. The variability is satisfied each day the service is provided to the customer. We directly ascribe variable fees to the distinct day of service to which it relates, and we consider the services performed each day in order to ascribe the appropriate amount of total fees to that day. Therefore, we measure revenues for our services on a daily basis based on the services that are performed on that day.
In some cases, we pay certain of our customers a signing incentive at contract inception or renewal. Consideration paid to customers is accounted for as a reduction of the transaction price and recognized as a reduction in revenues as the related services are provided to the customer, typically over the contract term. The deferred portion of consideration paid to customers is presented within other assets in our combined balance sheets.
Cash and cash equivalents
Cash and cash equivalents include cash on hand and all liquid investments with a maturity of three months or less when purchased. Our Parent operates under a centralized cash management strategy, using zero balance accounts in certain countries to manage its cash. Bank accounts controlled by the Business that participated in such arrangements have no balances.
We regularly maintain cash balances with financial institutions in excess of the Federal Deposit Insurance Corporation insurance limit or the equivalent outside the U.S. As of December 31, 2025, approximately 75% of our total balance of cash and cash equivalents was held within a small group of financial institutions, primarily large money center banks. Although we currently believe that the financial institutions with whom we do business will be able to fulfill their commitments to us, there is no assurance that those institutions will be able to continue to do so. We have not experienced any losses associated with our balances in such accounts for the years ended December 31, 2025 and 2024.
Accounts receivable, contract assets and contract liabilities
A contract with a customer creates legal rights and obligations. As we perform under customer contracts, our right to consideration that is unconditional is considered to be accounts receivable. If our right to consideration for such performance is contingent upon a future event or satisfaction of additional performance obligations, the amount of revenues we have recognized in excess of the amount we have billed to the customer is recognized as a contract asset. Contract liabilities represent consideration received from customers in excess of revenues recognized. Contract assets and liabilities are presented net at the individual contract level in the combined balance sheets and are classified as current or noncurrent based on the nature of the underlying contractual rights and obligations. See “Note 2 - Revenues” for further information.
Contract costs
We capitalize certain costs to obtain contracts with customers, including employee sales commissions and fees to business partners. At contract inception, we capitalize costs incurred that we expect to recover and that would not have been incurred if the contract had not been obtained. In certain instances in which costs related to obtaining customers are incurred after the inception of the customer contract, such costs are capitalized as the corresponding liability is recognized. We also capitalize certain costs incurred to fulfill our contracts with customers that (i) relate directly to the contract, (ii) are expected to generate resources that will be used to satisfy our performance obligation under the contract and (iii) are expected to be recovered through revenues generated under the contract. Capitalized costs to obtain and to fulfill contracts are included in other noncurrent assets.
8
Contract costs are amortized to operating expense in our combined statements of income on a systematic basis consistent with the transfer to the customer of the goods or services to which the asset relates. Amortization of capitalized costs to obtain customer contracts is included in selling, general and administrative expenses in the combined statements of income, while amortization of capitalized costs to fulfill customer contracts is included in cost of service. We utilize a straight-line or proportional amortization method depending upon which method best depicts the pattern of transfer of the goods or services to the customer. We amortize these assets over the expected period of benefit, which, based on the factors noted above, is typically three to seven years. In order to determine the appropriate amortization period for capitalized contract costs, we consider a combination of factors, including customer attrition rates, estimated terms of customer relationships, the useful lives of technology we use to provide goods and services to our customers, whether future contract renewals are expected and if there is any incremental commission expected to be paid associated with a contract renewal. Costs to obtain a contract with an expected period of benefit of one year or less are recognized as an expense when incurred. We evaluate contract costs for impairment by comparing, on a pooled basis, the expected future net cash flows from underlying customer relationships to the carrying amount of the capitalized contract costs. See “Note 2 - Revenues” for further information.
Reserve for contract contingencies and processing errors
A significant number of our customer contracts contain service level agreements that can result in performance penalties payable by us if we do not meet contractually required service levels. We recognize an accrual for estimated performance penalties and processing errors. When providing for these accruals, we consider such factors as our history of incurring performance penalties and processing errors, actual contractual penalty charge rates in our contracts, progress towards milestones and known processing errors. These accruals are included in accounts payable and accrued liabilities in our combined balance sheets. Depending on the nature of the item, transaction processing provisions are either included as a reduction of the transaction price and recognized as a reduction in revenues as the related services are provided to the customer or recognized as a component of cost of service in our combined statements of income.
Property and equipment
Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are generally calculated using the straight-line method. Leasehold improvements are amortized over the lesser of the remaining term of the lease and the useful life of the asset.
We develop software that is used to provide services to customers. Capitalization of internal-use software costs, primarily associated with operating platforms, occurs when we have completed the preliminary project stage, management authorizes the project, management commits to funding the project, and it is probable the project will be completed and the project will be used to perform the function intended. Costs incurred during the preliminary project stage are recognized as expense as incurred. Capitalized internal-use software is amortized over its estimated useful life, which is typically five to ten years, in a manner that best reflects the pattern of economic use of the assets. See “Note 3 - Property and Equipment” for further information.
Goodwill
The Business is comprised of a single reporting unit. We test goodwill for impairment annually (in the fourth quarter) and more often if an event occurs or circumstances change that indicate the fair value of the reporting unit is below its carrying amount. We have the option of performing a qualitative assessment of impairment to determine whether any further quantitative assessment for impairment is necessary. The election of whether or not to perform a qualitative assessment is made annually.
Factors we consider in the qualitative assessment include general macroeconomic conditions, industry and market conditions, cost factors, overall financial performance, events or changes affecting the composition or carrying amount of the net assets, and other relevant entity-specific events. If we elect to bypass the qualitative assessment or if we determine, on the basis of qualitative factors, that the fair value is more likely than not less than the carrying amount, a quantitative test would be required. The quantitative assessment compares the estimated fair value to carrying amount, and recognizes an impairment loss for the amount by which carrying amount exceeds its estimated fair value, without exceeding the total amount of goodwill.
9
As of October 1, 2025 and 2024, we performed a quantitative assessment of impairment. We determined on the basis of the quantitative assessments that the fair value of the reporting unit was greater than its carrying amount, indicating no impairment.
See “Note 4 - Goodwill and Other Intangible Assets” for further information.
Other intangible assets
Other intangible assets include customer-related intangible assets, contract-based intangible assets, acquired technologies, trademarks and trade names associated with business combinations. These assets are amortized over their estimated useful lives. The useful lives for customer-related intangible assets are determined based primarily on forecasted cash flows, which include estimates for the revenues, expenses and customer attrition associated with the assets. The useful lives of contract-based intangible assets are equal to the terms of the agreements. The useful lives of acquired technologies are based on an estimate of the period over which we expect to receive economic benefit. The useful lives of amortizable trademarks and trade names are based on an estimate of the period over which we will earn revenues for the related assets, including contemplation of any future plans to use the trademarks and trade names in the applicable markets.
We use the straight-line method of amortization for our amortizable acquired technologies, trademarks and trade names and certain contract-based intangible assets. Amortization for most of our customer-related intangible assets and certain contract-based intangible assets is determined using an accelerated method. Under this accelerated method, we determine amortization expense for any period by first dividing the expected cash flows for that period that were used in determining the acquisition-date fair value of the asset by the expected total cash flows over the estimated life of the asset. We then multiply that ratio by the initial carrying amount of the asset to arrive at the amortization expense for that period. If the cash flow patterns that we experience differ significantly from our initial estimates, we adjust the amortization schedule prospectively. We believe that our accelerated method reflects the expected pattern of the benefit to be derived. See “Note 4 - Goodwill and Other Intangible Assets” for further information.
Implementation costs incurred in a cloud computing arrangement
We capitalize implementation costs associated with cloud computing arrangements that are service contracts, and we amortize these capitalized implementation costs to expense on a straight-line basis over the term of the applicable hosting arrangement. Our cloud computing arrangements involve services we use to support certain internal corporate functions as well as technology associated with revenue-generating activities. As of December 31, 2025 and 2024, capitalized implementation costs, net of accumulated amortization, were $178.7 million and $162.8 million, respectively, and are presented within other noncurrent assets in the combined balance sheets. Amortization expense for the years ended December 31, 2025 and 2024 was $2.6 million and $0.6 million, respectively, and is presented in the same line item in the combined statements of income as the expense for the associated cloud services arrangement. During the year ended December 31, 2024, we also recognized a charge of $28.5 million for technology assets that will no longer be utilized under a revised technology architecture development strategy. The charge was included within selling, general and administrative expenses in our combined statements of income.
Leases
We evaluate each of our lease and service arrangements at inception to determine if the arrangement is, or contains, a lease and the appropriate classification of each identified lease. A lease exists if we obtain substantially all of the economic benefits of, and have the right to control the use of, an asset for a period of time. Right-of-use assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease agreement. We recognize right-of-use assets and lease liabilities at the lease commencement date based on the present values of fixed lease payments over the term of the lease. Right-of-use assets may also be adjusted to reflect any prepayments made or any incentive payments received. Operating lease costs and depreciation expense for finance leases are recognized as expense on a straight-line basis over the lease term. We consider a termination or renewal option in the determination of the lease term when it is reasonably certain that we will exercise that option. Because our leases generally do not provide a readily determinable implicit interest rate, we use an incremental borrowing rate to measure the lease liability and associated right-of-use asset at the lease commencement date. The incremental borrowing rate used is a fully collateralized rate that considers our credit rating, market conditions and the term of the lease at the lease commencement date. We have made an accounting policy election to not recognize assets or liabilities for leases with a term of less than 12 months and to account for all components in a lease arrangement as a single combined lease component for all asset classes with the exception of computer equipment, for which we account for lease and non-lease components separately. See “Note 5 - Leases” for further information.
10
Impairment of long-lived assets
We regularly evaluate whether events and circumstances have occurred that indicate the carrying amount of property and equipment, capitalized software, lease right-of-use assets and finite-life intangible assets may not be recoverable. When factors indicate that these long-lived assets should be evaluated for possible impairment, we assess the potential impairment by determining whether the carrying amount of such long-lived assets will be recovered through the future undiscounted cash flows expected from use of the asset and its eventual disposition. The evaluation is performed at the asset group level, which is the lowest level of identifiable cash flows. If the carrying amount of the asset group is determined to be not recoverable, a write-down to fair value is recognized. Fair values are determined based on quoted market prices or discounted cash flow analysis as applicable. We regularly evaluate whether events and circumstances have occurred that indicate the useful lives of property and equipment and finite-life intangible assets may warrant revision.
Equity method investments
We have certain investments that we account for using the equity method of accounting. Equity method investments are recognized initially at cost and subsequently adjusted for contributions, distributions, our portion of equity in earnings and foreign currency translation adjustments. As of December 31, 2025 and 2024, we had total equity method investments of $13.7 million and $12.1 million, respectively, presented within other noncurrent assets in the combined balance sheets.
Income taxes
Income taxes as presented in these combined financial statements have been allocated in a manner that is systematic, rational and consistent. The Business’ operations have historically been included in the Parent’s U.S. federal consolidated tax return, state tax returns and certain foreign tax returns. For the purposes of these combined financial statements, the Business’ income tax provision was computed as if the Business filed separate tax returns as a standalone taxpayer. Further, the Business’ tax results as presented herein may not be reflective of the results that the Business expects to generate in the future.
The Business’ primary U.S. operating entity is a single-member limited liability company that does not have an entity-level income tax, except for a few states and localities. In addition, prior to a reorganization by the Parent in anticipation of the proposed sale of the Business in late 2025, there were no U.S. shareholder taxes related to foreign operations for the Business.
Payments to certain tax authorities are made by the Parent. As such, related current tax payments are deemed to be settled with the Parent at the end of each reporting period through changes in net Parent investment.
We determine our provision for income taxes using management’s judgments, estimates and interpretation and application of complex tax laws in each of the jurisdictions in which we operate. Judgment is also required in assessing the timing and amounts of deductible and taxable items. Such differences in timing result in deferred tax assets and liabilities in our combined balance sheets.
We believe the Parent’s and our tax return positions are fully supportable; however, we recognize the benefit for tax positions only when it is more likely than not that the position will be sustained based on its technical merits. Issues raised by a tax authority may be resolved at an amount different than the related benefit recognized. When facts and circumstances change (including an effective settlement of an issue or statute of limitations expiration), the effect is recognized in the period of change.
Judgment is required to determine whether or not some portion or all of our deferred tax assets will not be realized. To the extent that we determine that we will not realize the benefit of some or all of our deferred tax assets, these deferred tax assets are adjusted via a valuation allowance through our provision for income taxes in the period in which this determination is made.
See “Note 8 - Income Tax” for further information regarding taxes.
11
Fair value measurements
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the reporting date. GAAP establishes a fair value hierarchy that categorizes the inputs to valuation techniques into three broad levels. Level 1 inputs utilize quoted prices in active markets for identical assets or liabilities. Level 2 inputs are based on other observable market data, such as quoted prices for similar assets and liabilities, and inputs other than quoted prices that are observable such as interest rates and yield curves. Level 3 inputs are developed from unobservable data reflecting our assumptions and include situations where there is little or no market activity for the asset or liability.
Fair value of financial instruments
The carrying amounts of cash and cash equivalents, receivables, accounts payable and accrued liabilities approximate their fair value given the short-term nature of these items.
Foreign currencies
We have significant operations in a number of foreign subsidiaries whose functional currency is the local currency. The assets and liabilities of subsidiaries whose functional currency is a foreign currency are translated into the reporting currency at the period-end rate of exchange. Income statement items are translated at the weighted-average rates prevailing during the period. The resulting translation adjustment is presented as a component of other comprehensive income and is included in accumulated comprehensive income within invested equity in our combined balance sheets.
Gains and losses on transactions denominated in currencies other than the functional currency are generally included in determining net income for the period. For the years ended December 31, 2025 and 2024, our transaction gains and losses were not significant. When a foreign subsidiary is disposed of in its entirety, the associated accumulated foreign currency translation gains or losses are reclassified from the separate component of invested equity into our combined statements of income.
Note 2 - Revenues
The following table presents a disaggregation of our revenues from contracts with customers by geography for the years ended December 31, 2025 and 2024:
| Years Ended December 31, | ||||||||
| 2025 | 2024 | |||||||
| (in thousands) | ||||||||
| Americas |
$ | 1,883,489 | $ | 1,839,480 | ||||
| Europe |
619,452 | 555,648 | ||||||
| Asia Pacific |
45,447 | 45,037 | ||||||
|
|
|
|
|
|||||
| $ | 2,548,388 | $ | 2,440,165 | |||||
|
|
|
|
|
|||||
ASC 606 requires that we determine for each customer arrangement whether revenue should be recognized at a point in time or over time. For the years ended December 31, 2025 and 2024, substantially all of our revenues were recognized over time.
12
Supplemental balance sheet information related to contracts from customers as of December 31, 2025 and 2024 was as follows:
| December 31, | ||||||||||
| Balance sheet location |
2025 | 2024 | ||||||||
| (in thousands) | ||||||||||
| Assets |
||||||||||
| Capitalized costs to obtain customer contracts, net |
Other noncurrent assets |
$ | 207 | $ | 251 | |||||
| Capitalized costs to fulfill customer contracts, net |
Other noncurrent assets |
142,937 | 139,275 | |||||||
| Contract assets, net |
Prepaid expenses and other current assets |
24,245 | 915 | |||||||
| Liabilities |
||||||||||
| Contract liabilities, net (current) |
Accounts payable and accrued liabilities |
49,911 | 40,417 | |||||||
| Contract liabilities, net (noncurrent) |
Other noncurrent liabilities |
33,871 | 29,231 | |||||||
Revenue recognized for the years ended December 31, 2025 and 2024 from contract liability balances at the beginning of each period was $38.8 million and $35.2 million, respectively.
ASC 606 requires disclosure of the aggregate amount of the transaction price allocated to unsatisfied performance obligations. The purpose of this disclosure is to provide additional information about the amounts and expected timing of revenue to be recognized from the remaining performance obligations in our existing contracts. The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied or partially unsatisfied at December 31, 2025. However, as permitted, we have elected to exclude from this disclosure any contracts with an original duration of one year or less and any variable consideration that meets specified criteria. Accordingly, the total amount of unsatisfied or partially unsatisfied performance obligations related to processing services is significantly higher than the amounts disclosed in the table below (in thousands):
| Year ending December 31, |
||||
| 2026 |
$ | 886,792 | ||
| 2027 |
674,396 | |||
| 2028 |
393,825 | |||
| 2029 |
214,880 | |||
| 2030 |
165,269 | |||
| 2031 and thereafter |
1,259,315 | |||
|
|
|
|||
| Total |
$ | 3,594,477 | ||
|
|
|
|||
13
Note 3 - Property and Equipment
As of December 31, 2025 and 2024, property and equipment, net consisted of the following:
| December 31, | ||||||||||||
| Range of Depreciable Lives |
2025 | 2024 | ||||||||||
| (Years) | (in thousands) | |||||||||||
| Software |
5 - 10 | $ | 799,958 | $ | 525,664 | |||||||
| Equipment |
3 - 20 | 324,731 | 259,934 | |||||||||
| Buildings |
40 | 176,473 | 170,701 | |||||||||
| Leasehold improvements |
5 - 15 | 31,865 | 25,918 | |||||||||
| Furniture and fixtures |
5 - 10 | 77,038 | 72,014 | |||||||||
| Land |
9,009 | 8,812 | ||||||||||
|
|
|
|
|
|||||||||
| 1,419,074 | 1,063,043 | |||||||||||
| Less accumulated depreciation and amortization |
(641,216 | ) | (522,296 | ) | ||||||||
|
Work-in-progress |
252,913 | 323,807 | ||||||||||
|
|
|
|
|
|||||||||
| $ | 1,030,771 | $ | 864,554 | |||||||||
|
|
|
|
|
|||||||||
During the year ended December 31, 2024, we wrote off capitalized software assets of $27.3 million for technology assets that will no longer be utilized under a revised technology architecture development strategy. The charge was presented within selling, general and administrative expenses in our combined statements of income.
Depreciation expense was $118.6 million for the year ended December 31, 2025 and $123.6 million for the year ended December 31, 2024.
Note 4 - Goodwill and Other Intangible Assets
As of December 31, 2025 and 2024, goodwill and other intangible assets, net consisted of the following:
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| (in thousands) | ||||||||
| Goodwill |
$ | 8,923,348 | $ | 8,925,537 | ||||
|
|
|
|
|
|||||
| Other intangible assets: |
||||||||
| Customer-related intangible assets |
$ | 4,897,332 | $ | 3,766,201 | ||||
| Acquired technologies |
$ | 1,073,409 | $ | 1,071,027 | ||||
| Contract-based intangible assets |
$ | 118,095 | $ | 118,095 | ||||
| Trademarks and trade names |
$ | 571,295 | $ | 570,016 | ||||
|
|
|
|
|
|||||
| 6,660,131 | $ | 5,525,339 | ||||||
|
|
|
|
|
|||||
| Less accumulated amortization: |
||||||||
| Customer-related intangible assets |
(1,526,978 | ) | $ | (1,095,714 | ) | |||
| Acquired technologies |
(964,790 | ) | $ | (809,645 | ) | |||
| Contract-based intangible assets |
(41,151 | ) | $ | (31,743 | ) | |||
| Trademarks and trade names |
(299,533 | ) | $ | (251,364 | ) | |||
|
|
|
|
|
|||||
| (2,832,452 | ) | $ | (2,188,466 | ) | ||||
|
|
|
|
|
|||||
| $ | 3,827,679 | $ | 3,336,873 | |||||
|
|
|
|
|
|||||
14
The following table sets forth the changes in the carrying amount of goodwill for the years ended December 31, 2025 and 2024:
| (in thousands) | ||||
| Balance at December 31, 2023 |
$ | 8,930,851 | ||
| Effect of foreign currency translation |
(5,314 | ) | ||
|
|
|
|||
| Balance at December 31, 2024 |
8,925,537 | |||
| Effect of foreign currency translation |
(2,189 | ) | ||
|
|
|
|||
| Balance at December 31, 2025 |
$ | 8,923,348 | ||
|
|
|
|||
Accumulated impairment losses for goodwill were $335.8 million as of December 31, 2025 and 2024.
Customer-related intangible assets acquired during the year ended December 31, 2024 had weighted-average amortization periods of 12.6 years. There were no customer-related intangible assets acquired during the year ended December 31, 2025. Amortization expense of acquired intangibles was $510.8 million for the year ended December 31, 2025 and $442.5 million for the year ended December 31, 2024.
The estimated amortization expense of acquired intangibles as of December 31, 2025 for the next five years, calculated using the currency exchange rate at the date of acquisition, if applicable, is as follows (in thousands):
| 2026 |
$ | 487,182 | ||
| 2027 |
377,577 | |||
| 2028 |
375,864 | |||
| 2029 |
373,247 | |||
| 2030 |
369,993 |
Note 5 - Leases
Our leases consist primarily of operating real estate leases for office space and data centers in the markets in which we conduct business. We also have operating and finance leases for computer and other equipment. Many of our leases include escalating rental payments and incentives, as well as termination and renewal options. Certain of our lease agreements provide that we pay the cost of property taxes, insurance and maintenance.
15
As of December 31, 2025 and 2024, right-of-use assets and lease liabilities consisted of the following:
| December 31, | ||||||||||
| Balance Sheet Location |
2025 | 2024 | ||||||||
| (in thousands) | ||||||||||
| Assets: |
||||||||||
| Operating lease right-of-use assets: |
||||||||||
| Real estate |
Other noncurrent assets |
$ | 70,759 | $ | 37,340 | |||||
| Computer equipment |
Other noncurrent assets |
— | — | |||||||
|
|
|
|
|
|||||||
| Total operating lease right-of-use-assets |
$ | 70,759 | $ | 37,340 | ||||||
|
|
|
|
|
|||||||
| Finance lease right-of-use assets: |
||||||||||
| Computer equipment |
Property and equipment, net |
$ | 2,616 | $ | 455 | |||||
| Other |
Property and equipment, net |
12,056 | 8,615 | |||||||
|
|
|
|
|
|||||||
| 14,672 | 9,070 | |||||||||
|
|
|
|
|
|||||||
| Less accumulated depreciation: |
||||||||||
| Computer equipment |
Property and equipment, net |
(937 | ) | (371 | ) | |||||
| Other |
Property and equipment, net |
(6,037 | ) | (3,409 | ) | |||||
|
|
|
|
|
|||||||
| Total accumulated depreciation |
(6,974 | ) | (3,780 | ) | ||||||
|
|
|
|
|
|||||||
| Total finance lease right-of-use assets |
7,698 | 5,290 | ||||||||
|
|
|
|
|
|||||||
| Total right-of-use assets |
$ | 78,457 | $ | 42,630 | ||||||
|
|
|
|
|
|||||||
| Liabilities: |
||||||||||
| Operating lease liabilities (current) |
Accounts payable and accrued liabilities |
$ | 16,110 | $ | 13,429 | |||||
| Operating lease liabilities (noncurrent) |
Other noncurrent liabilities |
62,560 | 29,017 | |||||||
| Finance lease liabilities (current) |
Current portion of long-term debt |
3,009 | 2,147 | |||||||
| Finance lease liabilities (noncurrent) |
Long-term debt |
5,470 | 3,314 | |||||||
|
|
|
|
|
|||||||
| Total lease liabilities |
$ | 87,149 | $ | 47,907 | ||||||
|
|
|
|
|
|||||||
The weighted-average remaining lease term for operating and finance leases at December 31, 2025 was 3.9 years and 3.3 years, respectively. The weighted-average remaining lease term for operating and finance leases at December 31, 2024 was 4.6 years and 3.3 years, respectively. As of December 31, 2025, the weighted-average discount rate used in the measurement of operating and finance lease liabilities was 5.2% and 5.3%, respectively. As of December 31, 2024, the weighted-average discount rate used in the measurement of operating and finance lease liabilities was 4.8% and 5.4%, respectively.
As of December 31, 2025, maturities of lease liabilities were as follows:
| Operating Leases |
Finance Leases |
|||||||
| (in thousands) | ||||||||
| Year ending December 31, |
||||||||
| 2026 |
$ | 19,545 | $ | 3,286 | ||||
| 2027 |
14,198 | 2,250 | ||||||
| 2028 |
11,901 | 1,973 | ||||||
| 2029 |
9,722 | 1,089 | ||||||
| 2030 |
7,769 | 632 | ||||||
| 2031 and thereafter |
32,550 | — | ||||||
|
|
|
|
|
|||||
| Total lease payments |
95,685 | 9,230 | ||||||
| Imputed interest |
17,015 | 751 | ||||||
|
|
|
|
|
|||||
| Total lease liabilities |
$ | 78,670 | $ | 8,479 | ||||
|
|
|
|
|
|||||
16
Operating lease costs in our combined statements of income for the year ended December 31, 2025 were $29.8 million, including $21.9 million in selling, general and administrative expenses and $7.9 million in cost of service. Total lease costs for the year ended December 31, 2025 include variable lease costs of $5.9 million, which are primarily comprised of the cost of property taxes, insurance and maintenance. Finance lease costs for the year ended December 31, 2025 were $2.8 million, including $2.7 million of amortization on right-of-use assets and $0.1 million of interest on lease liabilities. Lease costs for leases with a term of less than 12 months were not material for the year ended December 31, 2025.
Operating lease costs in our combined statements of income for the year ended December 31, 2024 were $25.9 million, including $22.1 million in selling, general and administrative expenses and $3.8 million in cost of service. Total lease costs for the year ended December 31, 2024 include variable lease costs of $2.1 million, which are primarily comprised of the cost of property taxes, insurance and maintenance. Finance lease costs for the year ended December 31, 2024 were $3.3 million, including $3.0 million of amortization on right-of-use assets and $0.3 million of interest on lease liabilities. Lease costs for leases with a term of less than 12 months were not material for the year ended December 31, 2024.
Cash paid for amounts included in the measurement of operating lease liabilities for the years ended December 31, 2025 and 2024 was $13.1 million and $8.0 million, respectively, which are included as a component of cash provided by operating activities in the combined statements of cash flows. Operating lease liabilities arising from obtaining new or modified right-of-use assets, net of reductions resulting from certain lease modifications, were $47.5 million and $10.6 million for the years ended December 31, 2025 and 2024, respectively. Cash paid for amounts included in the measurement of finance lease liabilities that is included as a component of cash used in financing activities in the combined statements of cash flows was $2.6 million and $3.1 million for the years ended December 31, 2025 and 2024, respectively. Finance lease liabilities arising from obtaining new or modified right-of-use assets, net of reductions resulting from certain lease modifications, were $4.8 million for the year ended December 31, 2025.
During the years ended December 31, 2025 and 2024, we entered into agreements to acquire hardware, software and related services, including the purchase of certain assets previously leased. During the year ended December 31, 2024, the reduction in operating lease liabilities arising from the termination of the related right-of-use assets was $5.4 million.
Note 6 - Long-Term Debt
As of December 31, 2025 and 2024, long-term debt consisted of the following:
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| (in thousands) | ||||||||
| Vendor financing liabilities |
$ | 137,585 | $ | 167,497 | ||||
| Finance lease liabilities |
8,479 | 5,461 | ||||||
|
|
|
|
|
|||||
| Total long-term debt |
146,064 | 172,958 | ||||||
| Less current portion |
96,846 | 66,974 | ||||||
|
|
|
|
|
|||||
| Long-term debt, excluding current portion |
$ | 49,218 | $ | 105,984 | ||||
|
|
|
|
|
|||||
At December 31, 2025, future maturities of long-term debt (excluding finance lease liabilities) are as follows by year (in thousands):
| Year ending December 31, |
||||
| 2026 |
$ | 93,837 | ||
| 2027 |
32,467 | |||
| 2028 |
4,559 | |||
| 2029 |
3,282 | |||
| 2030 |
3,440 | |||
| 2031 |
— | |||
|
|
|
|||
| Total |
$ | 137,585 | ||
|
|
|
|||
See “Note 5 - Leases” for more information about our finance lease liabilities, including maturities.
Cash paid for interest for the years ended December 31, 2025 and 2024 was $9.8 million and $12.1 million, respectively.
17
Vendor Financing Arrangements
During the years ended December 31, 2025 and 2024, we entered into agreements to acquire hardware, software and related services, portions of which were financed. During the year ended December 31, 2025, $84.7 million was financed utilizing two to six-year vendor financing arrangements, and during the year ended December 31, 2024, $60.5 million was financed utilizing two to five-year vendor financing arrangements. Certain of these agreements included the purchase of assets previously leased. The imputed interest rates range from 4.38% to 7.49%. Interest expense of $12.1 million and $10.5 million for the years ended December 31, 2025 and 2024, respectively, was included in interest and other expense in our combined statements of income.
We have contractual obligations related to service arrangements with suppliers for fixed or minimum amounts. Future minimum payments at December 31, 2025 for purchase obligations were as follows (in thousands):
| Year ending December 31, |
||||
| 2026 |
$ | 469,110 | ||
| 2027 |
270,697 | |||
| 2028 |
255,059 | |||
| 2029 |
204,525 | |||
| 2030 |
97,898 | |||
| 2031 and thereafter |
— | |||
|
|
|
|||
| Total future minimum payments |
$ | 1,297,289 | ||
|
|
|
|||
Note 7 - Accounts Payable and Accrued Liabilities
As of December 31, 2025 and 2024, accounts payable and accrued liabilities consisted of the following:
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| (in thousands) | ||||||||
| Trade accounts payable |
93,498 | 66,237 | ||||||
| Contract liabilities |
49,911 | 40,417 | ||||||
| Compensation and benefits |
35,931 | 21,031 | ||||||
| Operating leases |
16,110 | 13,430 | ||||||
| Income taxes |
11,701 | 9,577 | ||||||
| Miscellaneous taxes and withholdings |
10,328 | 8,849 | ||||||
| Other |
104,201 | 94,830 | ||||||
|
|
|
|
|
|||||
| $ | 321,680 | $ | 254,371 | |||||
|
|
|
|
|
|||||
18
Note 8 - Income Tax
The income tax expense for the years ended December 31, 2025 and 2024 consisted of the following:
| Years Ended December 31, | ||||||||
| 2025 | 2024 | |||||||
| (in thousands) | ||||||||
| Current income tax expense: |
||||||||
| Federal |
$ | 6,235 | $ | 3,800 | ||||
| State |
735 | 1,209 | ||||||
| Foreign |
7,620 | 23,049 | ||||||
|
|
|
|
|
|||||
| 14,590 | 28,058 | |||||||
|
|
|
|
|
|||||
| Deferred income tax expense (benefit): |
||||||||
| Federal |
9,180 | (2,955 | ) | |||||
| State |
(1,639 | ) | (1,071 | ) | ||||
| Foreign |
(3,132 | ) | (8,522 | ) | ||||
|
|
|
|
|
|||||
| 4,409 | (12,548 | ) | ||||||
|
|
|
|
|
|||||
| $ | 18,999 | $ | 15,510 | |||||
|
|
|
|
|
|||||
The following table presents income before income taxes for the years ended December 31, 2025 and 2024:
| Years Ended December 31, | ||||||||
| 2025 | 2024 | |||||||
| (in thousands) | ||||||||
| United States |
$ | 133,460 | $ | 66,927 | ||||
| Foreign |
32,651 | 48,857 | ||||||
|
|
|
|
|
|||||
| $ | 166,111 | $ | 115,784 | |||||
|
|
|
|
|
|||||
As described in Note 1, the Business has elected to prospectively adopt the guidance in ASU 2023-09. Our effective tax rate for the year ended December 31, 2025, in accordance with the guidance in ASU 2023-09 retrospectively, differs from the federal statutory rate as follows:
19
| Year Ended December 31, | ||||||||
| 2025 | ||||||||
| Amount | Rate | |||||||
| Income before income taxes and equity in income of equity method investments |
$ | 166,111 | ||||||
| Federal U.S. statutory rate |
34,883 | 21.0 | % | |||||
| Federal: |
||||||||
| Cross-border tax laws: |
||||||||
| Global intangible low-taxes income |
1,979 | 1.2 | % | |||||
| US entities not subject to federal income tax |
(16,081 | ) | (9.7 | )% | ||||
| Other reconciling items |
1,333 | 0.8 | % | |||||
| State income taxes, net of federal income tax benefit (1) |
(746 | ) | (0.4 | )% | ||||
| Foreign tax effects: |
||||||||
| United Kingdom: |
||||||||
| Tax Credits |
(2,172 | ) | (1.3 | )% | ||||
| Other |
1,069 | 0.6 | % | |||||
| Dominican Republic |
2,246 | 1.4 | % | |||||
| Germany: |
||||||||
| Rate Differential |
(3,167 | ) | (1.9 | )% | ||||
| Gain/loss on dispositions and restructuring |
(5,476 | ) | (3.3 | )% | ||||
| Other |
(836 | ) | (0.5 | )% | ||||
| Other jurisdictions |
5,967 | 3.5 | % | |||||
|
|
|
|
|
|||||
| Effective tax rate |
$ | 18,999 | 11.4 | % | ||||
|
|
|
|
|
|||||
| (1) | State taxes in Alabama, Arkansas, California, Georgia, Illinois, Indiana, Kentucky, Louisiana, Michigan, Missouri, New Jersey, New York City, Pennsylvania, Tennessee made up the majority of the tax effect in this category. |
Our effective tax rate for the year ended December 31, 2024, in accordance with guidance prior to the adoption of ASU 2023-09, differs from the federal statutory rate as follows:
| Year Ended December 31, |
||||
| 2024 | ||||
| Federal U.S. statutory rate |
21.0 | % | ||
| Withholding taxes, net of foreign tax credit |
2.8 | % | ||
| Foreign income taxes |
0.9 | % | ||
| State income taxes, net of federal income tax benefit |
0.1 | % | ||
| US entities not subject to federal income tax |
(11.0 | )% | ||
| Other |
(0.4 | )% | ||
|
|
|
|||
| Effective tax rate attributable to the Business |
13.4 | % | ||
|
|
|
|||
20
Cash paid for income taxes for the year ended year ended December 31, 2024 was $10.5 million. Cash paid for income taxes for the year ended December 31, 2025, in accordance with the updated requirements of ASU 2023-09, was as follows:
| Year Ended December 31, |
||||
| 2025 | ||||
| (in thousands) | ||||
| U.S. Federal |
$ | — | ||
| U.S. State & Local |
187 | |||
| Foreign: |
||||
| United Kingdom |
2,432 | |||
| India |
7,316 | |||
| Chile |
4,244 | |||
| Germany |
785 | |||
| Other |
192 | |||
|
|
|
|||
| Total |
$ | 15,156 | ||
|
|
|
|||
Deferred income taxes are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax laws and rates. Deferred income taxes as of December 31, 2025 and 2024 reflect the effect of temporary differences between the amounts of assets and liabilities for financial accounting and income tax purposes. As of December 31, 2025 and 2024, principal components of deferred tax items were as follows:
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| (in thousands) | ||||||||
| Deferred tax assets: |
||||||||
| Net operating loss carryforward |
$ | 10,283 | 1,460 | |||||
| Deferred revenue |
$ | 3,441 | 5,003 | |||||
| Accrued expenses |
$ | 1,357 | 2,313 | |||||
| Property and equipment |
$ | — | 6,062 | |||||
| Other |
$ | 1,500 | 1,281 | |||||
|
|
|
|
|
|||||
| 16,581 | 16,119 | |||||||
|
|
|
|
|
|||||
| Deferred tax liabilities: |
||||||||
| Partnership interest |
$ | 198,991 | $ | — | ||||
| Acquired intangibles |
$ | 48,799 | $ | 64,200 | ||||
| Property and equipment |
$ | 4,575 | $ | — | ||||
| Other |
$ | 420 | 1,573 | |||||
|
|
|
|
|
|||||
| $ | 252,785 | $ | 65,773 | |||||
|
|
|
|
|
|||||
| Net deferred income tax liability |
$ | 236,204 | $ | 49,654 | ||||
|
|
|
|
|
|||||
As discussed in Note 12 - Relationship with Parent and Other Related Parties, during the year ended December 31, 2025, the Parent contributed $991.4 million of intangible assets to the Business in anticipation of the proposed sale of the Business. The $199.0 million deferred tax liability for partnership interest is associated with these intangible assets.
21
The net deferred income taxes reflected in our consolidated balance sheets as of December 31, 2025 and 2024 are as follows:
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| (in thousands) | ||||||||
| Noncurrent deferred income tax asset |
$ | (14,584 | ) | $ | (7,884 | ) | ||
| Noncurrent deferred income tax liability |
250,788 | 57,538 | ||||||
|
|
|
|
|
|||||
| Net deferred income tax liability |
$ | 236,204 | $ | 49,654 | ||||
|
|
|
|
|
|||||
The Business did not have any valuation allowances as of December 31, 2025 and 2024. As of December 31, 2025, foreign net operating loss carryforwards of $1.4 million will expire by December 31, 2040, if not utilized. Foreign net operating loss carryforwards of $8.9 million have indefinite carryforward periods. As of December 31, 2025, the Business did not have any gross unrecognized income tax benefits.
We conduct business in the U.S. and various foreign jurisdictions and have corresponding income tax filing responsibilities, either directly or indirectly through the Parent. We are generally included in the Parent’s U.S. income tax filings. We are no longer subject to foreign income tax examinations for years ended on or before December 31, 2020.
Note 9 - Share-Based Awards and Options
Eligible employees of the Business participate in share-based compensation plans of the Parent, under which the Parent maintains and grants nonqualified stock options, restricted stock and performance unit awards (collectively, the “Plans”). The following disclosures represent our portion of the Plans maintained by the Parent in which our employees participated. All awards granted under the Plans consist of the Parent’s common shares. As a result, all related invested equity account balances remain at the Parent level and have been recognized through net Parent investment in our combined balance sheets, with expenses for the awards granted to the employees recognized in our combined statements of income.
Share-based compensation expense includes expense attributable to the Business based on the awards and terms previously granted to the Business’ employees and an allocation of Parent’s corporate and shared functional employee expenses. The amounts presented are not necessarily indicative of future awards and do not necessarily reflect the costs the Company would have incurred as an independent company for the periods presented.
The following table summarizes share-based compensation expense and the related income tax benefit recognized for awards under the Plans granted to the Business’ employees and an allocation of Parent’s corporate and shared functional employees:
| Years Ended December 31, |
||||||||
| 2025 | 2024 | |||||||
| (in thousands) | ||||||||
| Share-based compensation expense |
$ | 39,111 | $ | 36,655 | ||||
| Income tax benefit |
$ | 349 | $ | 1,330 | ||||
22
Note 10 - Accumulated Other Comprehensive Income (Loss)
The changes in the accumulated balances for each component of other comprehensive income (loss) were as follows for the years ended December 31, 2025 and 2024:
| Foreign Currency Translation Gains (Losses) |
Other | Accumulated Other Comprehensive Income (Loss) |
||||||||||
| (in thousands) | ||||||||||||
| Balance at December 31, 2023 |
$ | (43,149 | ) | $ | (87 | ) | $ | (43,236 | ) | |||
| Other comprehensive loss |
(24,974 | ) | — | (24,974 | ) | |||||||
|
|
|
|
|
|
|
|||||||
| Balance at December 31, 2024 |
(68,123 | ) | (87 | ) | (68,210 | ) | ||||||
| Other comprehensive income |
71,626 | — | 71,626 | |||||||||
|
|
|
|
|
|
|
|||||||
| Balance at December 31, 2025 |
$ | 3,503 | $ | (87 | ) | $ | 3,416 | |||||
|
|
|
|
|
|
|
|||||||
Note 11 - Commitments and Contingencies
Legal Matters
The Parent is party to a number of claims and lawsuits incidental to its business. Certain claims and lawsuits may be specific to the operations of the Business, and the Business may be a party to these claims and lawsuits. In the Parent’s and the Business’ opinion, the liabilities, if any, which may ultimately result from the outcome of such matters, individually or in the aggregate, are not expected to have a material adverse effect on the financial position, liquidity, results of operations or cash flows.
Operating Taxes
We are subject to certain taxes that are not derived based on earnings (e.g., sales, gross receipts, property, value-added and other business taxes). During the course of operations, we must interpret the meaning of various operating tax regulations in the United States and in the foreign jurisdictions in which we do business. We are subject to ongoing audits in certain jurisdictions, and taxing authorities in those various jurisdictions may arrive at different interpretations of applicable tax laws and regulations which could result in the payment of additional taxes in those jurisdictions.
Note 12 - Relationship with Parent and Other Related Parties
In the normal course of its business, the Business engages in transactions with the Parent and other businesses of the Parent. The below transactions represent significant activities between the Business and these entities.
Intangible Assets Contribution from Parent
On March 31, 2025, in anticipation of the proposed sale of the Business, certain customer relationship intangible assets were contributed by the Parent to the Business. Previously, the Business incurred a quarterly royalty charge for use of these assets. The contribution of intangible assets of $991.4 million was reflected as an increase in net Parent investment, and the related party royalty charge ceased in the second quarter of 2025, with the Business instead recognizing amortization expense related to the contributed assets. Amortization expense of these contributed assets was $66.8 million for the year ended December 31, 2025.
Related Party Transactions
All significant intercompany transactions between us and the Parent that have not been historically cash settled are deemed to be intercompany financing transactions and are treated as contributions from/distributions to Parent. All intercompany accounts, profits and transactions among the Business’ combined entities have been eliminated.
Related party revenues in the combined statements of income for the years ended December 31, 2025 and 2024 of $84.8 million and $75.5 million, respectively, consist of software development services and customer transaction processing services provided to the Parent’s Merchant Solutions business.
23
Related party expenses primarily consist of royalty charges for the use of intangible assets by the Business and were presented in the combined statements of income for the years ended December 31, 2025 and 2024 as follows:
| Years Ended December 31, | ||||||||
| 2025 | 2024 | |||||||
| (in thousands) | ||||||||
| Cost of service |
36,243 | $ | 129,450 | |||||
| Selling, general and administrative |
5,107 | 2,946 | ||||||
| Interest and other expense |
126 | 190 | ||||||
|
|
|
|
|
|||||
| Total related party expenses |
$ | 41,476 | $ | 132,586 | ||||
|
|
|
|
|
|||||
Due to Parent of $136.4 million and due from Parent of $82.7 million as of December 31, 2025 and 2024, respectively, primarily consist of balances related to the royalty arrangement, software development services and certain third-party invoices and employee payroll paid on behalf of the Business. As the counterparty of these related party transactions is under common control, there is a right of offset as treasury can move cash between entities to settle balances as needed to execute the cash management strategies of the Business. Additionally, there are no material notes receivable or payable, and therefore, no material balances governed by legal agreements. As such, due to Parent and due from Parent are presented net.
Allocation of Corporate Costs
The combined financial statements include corporate costs incurred by the Parent for services that are provided to or on behalf of the Business, including, but not limited to, general corporate expenses related to finance, legal, information technology, human resources, shared services, executive expenses and corporate initiatives. These costs consist of allocated cost pools and direct costs.
These costs have been attributed to us directly when identifiable, with the remainder allocated on the basis of revenues or headcount. Total general corporate expenses incurred by the Parent that are allocated to the Business in the combined statements of income for the years ended December 31, 2025 and 2024 were as follows:
| Years Ended December 31, | ||||||||
| 2025 | 2024 | |||||||
| (in thousands) | ||||||||
| Cost of service |
$ | 8,083 | $ | 3,759 | ||||
| Selling, general and administrative |
$ | 300,974 | $ | 262,933 | ||||
|
|
|
|
|
|||||
| Total allocated costs |
$ | 309,057 | $ | 266,692 | ||||
|
|
|
|
|
|||||
Our management and the management of the Parent consider the expenses included and the allocation methodologies used to be reasonable and appropriate reflections of the historical Parent expenses attributable to us for purposes of the stand-alone financial statements; however, the expenses reflected in these combined financial statements may not be indicative of the actual expenses that would have been incurred during the periods presented if we historically operated as a separate, stand-alone entity. In addition, the expenses reflected in the combined financial statements may not be indicative of expenses that we could incur in the future.
24
Net Parent Investment
Net transfers to Parent are included within net transfers to Parent in the combined statements of invested equity and within financing activities in the combined statements of cash flows and represent the net effect of transactions between the Business and Parent. The reconciliation of net transfers to Parent between the combined statements of invested equity and the combined statements of cash flows is as follows:
| Years Ended December 31, | ||||||||
| 2025 | 2024 | |||||||
| (in thousands) | ||||||||
| Net transfers from (to) Parent per the combined statements of invested equity |
$ | 23,526 | $ | (386,822 | ) | |||
| Share-based compensation expense |
(39,111 | ) | (36,655 | ) | ||||
| Net assets transferred from Parent |
(797,035 | ) | (20,155 | ) | ||||
|
|
|
|
|
|||||
| Net transfers to Parent per the combined statements of cash flows |
$ | (812,620 | ) | $ | (443,632 | ) | ||
|
|
|
|
|
|||||
Net assets transferred from Parent is primarily comprised of the contribution of certain customer relationship intangible assets utilized in international markets.
Cash Management and Financing
The Business participates in the Parent’s centralized cash management and financing programs. Disbursements are made through centralized accounts payable systems that are operated by the Parent. Cash receipts are transferred to centralized accounts maintained by the Parent. As cash is disbursed and received by the Parent, it is accounted for by the Business through net Parent investment.
The cash balance reflected in the combined balance sheets consists of the cash managed and controlled by the Business before it is transferred to the centralized cash management pool of the Parent and cash held in foreign jurisdictions that is either not centrally managed or that is centrally managed internationally within the Business.
Note 13 - Subsequent Events
The Business has evaluated subsequent events for matters that require recognition or disclosure in these combined financial statements through February 20, 2026, which is the date the combined financial statements were available to be issued.
25
Exhibit 99.2
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
Introduction
Description of the Transactions
On January 9, 2026 (the “Closing Date”), Fidelity National Information Services, Inc., a Georgia corporation (“FIS” or the “Company”), completed its previously announced (i) acquisition of the Issuer Solutions business (the “Issuer Solutions Business” or “Issuer Solutions”) from Global Payments Inc., a Georgia corporation (“Global Payments”), and (ii) sale of all of its equity interests in Worldpay Holdco, LLC, a Delaware limited liability company (“Worldpay”), pursuant to the transaction agreement (the “FIS Transaction Agreement”) entered into on April 17, 2025, by and among FIS, Global Payments, Total System Services LLC, a Delaware limited liability company (the “Purchased Entity”), and Worldpay.
Concurrently with the consummation of the transactions contemplated by the FIS Transaction Agreement, Global Payments completed the acquisition of 100% of the issued and outstanding equity interests of Worldpay that were not owned by FIS, pursuant to the transaction agreement (the “GTCR Transaction Agreement” and together with the FIS Transaction Agreement, the “Transaction Agreements”), entered into on April 17, 2025, by and among Global Payments, Worldpay, certain affiliates of GTCR LLC (“GTCR”) and certain other parties thereto.
Upon the terms and subject to the conditions set forth in the FIS Transaction Agreement, FIS acquired from Global Payments the Issuer Solutions Business through the acquisition of 100% of the issued and outstanding equity interests of the Purchased Entity (the “Issuer Solutions Acquisition”). As consideration for the Issuer Solutions Acquisition, FIS (i) sold to Global Payments its remaining equity interests in Worldpay (the “Worldpay Disposition” and together with the Issuer Solutions Acquisition, the “Transactions”) and (ii) paid approximately $7.7 billion in cash, representing the excess of the purchase price payable by FIS in respect of the Issuer Solutions Acquisition over the purchase price payable by Global Payments in respect of the Worldpay Disposition. The cash payment amount is subject to customary post-closing adjustments in respect of the respective purchase price for each of Worldpay and the Issuer Solutions Business.
The purchase price paid by Global Payments in respect of Worldpay was based on a $24.25 billion enterprise valuation of Worldpay, and the purchase price paid by FIS in respect of the Issuer Solutions Business was based on a $13.5 billion enterprise valuation of the Issuer Solutions Business, in each case, subject to customary adjustments for the cash, debt and working capital (relative to a target) of Worldpay and the Issuer Solutions Business, respectively, as of the closing of the transactions contemplated by the FIS Transaction Agreement and the GTCR Transaction Agreement (the “Closing”).
Description of the Financing
In connection with the FIS Transaction Agreement, FIS entered into a commitment letter on April 17, 2025, with Goldman Sachs Bank USA, Wells Fargo Bank, National Association, and Wells Fargo Securities, LLC (collectively, the “Lenders”). Pursuant to the commitment letter, the Lenders committed to provide an unsecured bridge term loan facility (the “Bridge Facility”) in an aggregate principal amount of up to $8.0 billion, subject to customary closing conditions.
On May 1, 2025, FIS, Goldman Sachs Bank USA, as administrative agent, and certain other financial institutions party thereto as lenders, entered into a Term Loan Credit Agreement (the “Term Loan Agreement”). Under the Term Loan Agreement, the Company was permitted to draw up to an aggregate principal amount of $8.0 billion of senior unsecured term loans (the “Delayed Draw Term Loans”). As a result of the Company entering into the Term Loan Agreement, the Bridge Facility commitments were reduced to $0 and the bridge commitment letter was terminated in accordance with its terms.
FIS drew on the Delayed Draw Term Loans (“DDTL”) on the Closing Date to fund a portion of the consideration payable under the FIS Transaction Agreement, as well as to pay fees and expenses related to the Transactions, including anticipated tax payments on the Worldpay Disposition. The Delayed Draw Term Loans mature 364 days after they are borrowed. Prior to maturity, FIS expects to replace the DDTL with new permanent financing shortly after the Closing Date. FIS currently expects the permanent financing will consist of $8 billion aggregate principal amount senior unsecured notes (the “Financing”). The pro forma condensed combined information assumes that FIS will be able to secure permanent financing and will not continue to have the DDTL outstanding. The amount, type, and terms of permanent financing could differ from current assumptions.
Basis of Presentation
The accompanying unaudited pro forma condensed combined financial statements and related notes were prepared in accordance with Article 11 of Regulation S-X.
The unaudited pro forma condensed combined financial statements and related notes are based on, and should be read in conjunction with the following financial statements incorporated by reference herein, (i) FIS’ historical audited consolidated financial statements as of and for the year ended December 31, 2025, and the related notes included in FIS’ Annual Report on Form 10-K for the year ended December 31, 2025, (ii) the Issuer Solutions Business’ historical audited combined financial statements as of and for the year ended December 31, 2025, and the related notes (we refer to (i) and (ii) as the 2025 annual financial statements).
The unaudited pro forma condensed combined balance sheet as of December 31, 2025, combines the historical consolidated balance sheet of FIS and the combined balance sheet of the Issuer Solutions Business that are included in the 2025 annual financial statements giving effect to the Transactions and the Financing as if those transactions had been completed on December 31, 2025.
1
The unaudited pro forma condensed combined statement of earnings (loss) for the year ended December 31, 2025 combines the historical consolidated statements of earnings of FIS and the combined statements of income of the Issuer Solutions Business that are included in the 2025 annual financial statements, giving effect to the Transactions and the Financing as if those transactions had occurred on January 1, 2025, the beginning of the earliest period presented.
The Issuer Solutions Business’ historical combined financial statements have been derived from the consolidated financial statements and accounting records of Global Payments and include allocations for direct costs and indirect costs attributable to the operations of the Issuer Solutions Business. These historical combined financial statements do not purport to reflect what the results of operations, comprehensive income, financial position, equity or cash flows would have been had the Issuer Solutions Business operated as an independent standalone company during the periods presented.
FIS and Issuer Solutions’ historical financial statements were prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and presented in U.S. dollars. The historical financial statements have been adjusted in the accompanying unaudited pro forma condensed combined financial information to give effect to pro forma adjustments which are necessary to account for the Transactions and the Financing. The unaudited pro forma adjustments are based upon available information and certain assumptions that management believes are reasonable.
2
UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
As of December 31, 2025
($ in millions)
| (in millions) |
FIS Historical as of December 31, 2025 |
Issuer Solutions Business Adjusted Historical as of December 31, 2025 (Note 2) |
Transaction Accounting Adjustments – Financing |
Note 4 | Transaction Accounting Adjustments - Worldpay Disposition |
Note 4 | Transaction Accounting Adjustments - Issuer Solutions Acquisition |
Note 4 | Pro Forma Combined |
|||||||||||||||||||||
| ASSETS |
||||||||||||||||||||||||||||||
| Current assets: |
||||||||||||||||||||||||||||||
| Cash and cash equivalents |
$ | 599 | $ | 403 | $ | 7,900 | (a) | $ | (700 | ) | (a) | $ | (7,730 | ) | (a) | $ | 472 | |||||||||||||
| Settlement assets |
515 | 183 | — | — | — | 698 | ||||||||||||||||||||||||
| Trade receivables, net of allowance for credit losses |
1,944 | 333 | — | — | — | 2,277 | ||||||||||||||||||||||||
| Other receivables |
432 | — | — | — | — | 432 | ||||||||||||||||||||||||
| Receivables from related party |
39 | — | — | — | — | 39 | ||||||||||||||||||||||||
| Prepaid expenses and other current assets |
959 | 293 | (6 | ) | (b) | 5,762 | (b) | (5,786 | ) | (b) | 1,222 | |||||||||||||||||||
| Total current assets |
4,488 | 1,212 | 7,894 | 5,062 | (13,516 | ) | 5,140 | |||||||||||||||||||||||
| Property and equipment, net |
691 | 385 | — | — | — | 1,076 | ||||||||||||||||||||||||
| Goodwill |
17,762 | 8,914 | — | — | (1,727 | ) | (c) | 24,949 | ||||||||||||||||||||||
| Intangible assets, net |
959 | 3,719 | — | — | 401 | (d) | 5,079 | |||||||||||||||||||||||
| Software, net |
2,876 | 755 | — | — | 578 | (e) | 4,209 | |||||||||||||||||||||||
| Equity method investment |
3,681 | 14 | — | (3,681 | ) | (f) | — | 14 | ||||||||||||||||||||||
| Other noncurrent assets |
1,710 | 477 | — | — | — | 2,187 | ||||||||||||||||||||||||
| Deferred contract costs, net |
1,321 | 143 | — | — | (143 | ) | (g) | 1,321 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Total assets |
$ | 33,488 | $ | 15,619 | $ | 7,894 | $ | 1,381 | $ | (14,407 | ) | $ | 43,975 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| LIABILITIES AND EQUITY |
||||||||||||||||||||||||||||||
| Current liabilities: |
||||||||||||||||||||||||||||||
| Accounts payable, accrued and other liabilities |
$ | 2,097 | 276 | $ | — | $ | (21 | ) | (h) | $ | (36 | ) | (h) | $ | 2,316 | |||||||||||||||
| Settlement payables |
549 | 404 | — | — | — | 953 | ||||||||||||||||||||||||
| Deferred revenue |
957 | 50 | — | — | — | 1,007 | ||||||||||||||||||||||||
| Short-term borrowings |
2,729 | — | — | — | — | 2,729 | ||||||||||||||||||||||||
| Current portion of long-term debt |
1,284 | 97 | — | — | — | 1,381 | ||||||||||||||||||||||||
| Total current liabilities |
7,616 | 827 | — | (21 | ) | (36 | ) | 8,386 | ||||||||||||||||||||||
| Long-term debt, excluding current portion |
9,069 | 49 | 7,900 | (i) | — | — | 17,018 | |||||||||||||||||||||||
| Deferred income taxes |
1,215 | 251 | — | (498 | ) | (j) | — | 968 | ||||||||||||||||||||||
| Other noncurrent liabilities |
1,686 | 250 | — | — | (137 | ) | (k) | 1,799 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Total liabilities |
$ | 19,586 | $ | 1,377 | $ | 7,900 | $ | (519 | ) | $ | (173 | ) | $ | 28,171 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Equity: |
||||||||||||||||||||||||||||||
| FIS Stockholders’ equity: |
||||||||||||||||||||||||||||||
| Preferred stock |
$ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||
| Common stock |
6 | — | — | — | — | 6 | ||||||||||||||||||||||||
| Net parent investment |
— | 14,239 | — | — | (14,239 | ) | (l) | — | ||||||||||||||||||||||
| Additional paid-in capital |
47,317 | — | — | — | 12 | (m) | 47,329 | |||||||||||||||||||||||
| (Accumulated deficit) retained earnings |
(22,718 | ) | — | (6 | ) | (n) | 2,009 | (n) | (4 | ) | (n) | (20,719 | ) | |||||||||||||||||
| Accumulated other comprehensive earnings (loss) |
(504 | ) | 3 | — | (109 | ) | (o) | (3 | ) | (l) | (613 | ) | ||||||||||||||||||
| Treasury stock |
(10,202 | ) | — | — | — | — | (10,202 | ) | ||||||||||||||||||||||
| Total FIS Shareholders’ Equity |
13,899 | 14,242 | (6 | ) | 1,900 | (14,234 | ) | 15,801 | ||||||||||||||||||||||
| Noncontrolling interest |
3 | — | — | — | — | 3 | ||||||||||||||||||||||||
| Total equity |
13,902 | 14,242 | (6 | ) | 1,900 | (14,234 | ) | 15,804 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Total liabilities and equity |
$ | 33,488 | $ | 15,619 | $ | 7,894 | $ | 1,381 | $ | (14,407 | ) | $ | 43,975 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
See the accompanying notes to the Unaudited Pro Forma Condensed Combined Financial Information
3
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF EARNINGS (LOSS)
For the Year ended December 31, 2025
($ in millions)
| (in millions) |
FIS Historical year ended December 31, 2025 |
Issuer Solutions Business Adjusted Historical year ended December 31, 2025 (Note 2) |
Transaction Accounting Adjustments - Financing |
Note 5 | Transaction Accounting Adjustments - Worldpay Disposition |
Note 5 | Transaction Accounting Adjustments - Issuer Solutions Acquisition |
Note 5 | Pro Forma Combined |
Note 5 | ||||||||||||||||||||||||
| Revenue |
$ | 10,677 | $ | 2,509 | $ | — | $ | — | $ | — | $ | 13,186 | ||||||||||||||||||||||
| Cost of revenue |
6,741 | 1,778 | — | — | (212 | ) | (a) | 8,307 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
| Gross profit |
3,936 | 731 | — | — | 212 | 4,879 | ||||||||||||||||||||||||||||
| Selling, general, and administrative expenses |
2,263 | 562 | — | — | 19 | (b) | 2,844 | |||||||||||||||||||||||||||
| Asset impairments |
18 | — | — | — | — | 18 | ||||||||||||||||||||||||||||
| Other operating (income) expense, net - related party |
(86 | ) | (43 | ) | — | — | — | (129 | ) | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
| Operating income |
1,741 | 212 | — | — | 193 | 2,146 | ||||||||||||||||||||||||||||
| Other income (expense): |
||||||||||||||||||||||||||||||||||
| Interest income |
24 | 1 | — | — | — | 25 | ||||||||||||||||||||||||||||
| Interest expense |
(391 | ) | (11 | ) | (405 | ) | (c) | — | — | (807 | ) | |||||||||||||||||||||||
| Other income (expense), net |
(198 | ) | 5 | — | — | — | (193 | ) | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
| Total other income (expense), net |
(565 | ) | (5 | ) | (405 | ) | — | — | (975 | ) | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
| Earnings (loss) before income taxes and equity method investment earnings (loss) |
1,176 | 207 | (405 | ) | — | 193 | 1,171 | |||||||||||||||||||||||||||
| Provision (benefit) for income taxes |
265 | 26 | (97 | ) | (d) | — | 70 | (d) | 264 | |||||||||||||||||||||||||
| Equity method investment earnings (loss), net of tax |
(526 | ) | — | — | 2,535 | (e) | — | 2,009 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
| Net earnings (loss) from continuing operations |
385 | 181 | (308 | ) | 2,535 | 123 | 2,916 | |||||||||||||||||||||||||||
| Net (earnings) loss attributable to noncontrolling interest from continuing operations |
(3 | ) | — | — | — | — | (3 | ) | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
| Net earnings (loss) attributable to FIS continuing operations |
$ | 382 | $ | 181 | $ | (308 | ) | $ | 2,535 | $ | 123 | $ | 2,913 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
| Basic earnings (loss) per common share attributable to FIS: |
0.73 | 5.57 | (f | ) | ||||||||||||||||||||||||||||||
| Diluted earnings (loss) per common share attributable to FIS: |
0.73 | 5.55 | (f | ) | ||||||||||||||||||||||||||||||
| Weighted average common shares outstanding: |
||||||||||||||||||||||||||||||||||
| Basic |
523 | 523 | ||||||||||||||||||||||||||||||||
| Diluted |
525 | 525 | ||||||||||||||||||||||||||||||||
See the accompanying notes to the Unaudited Pro Forma Condensed Combined Financial Information
4
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
Note 1 – Accounting for the Issuer Solutions Acquisition
The accompanying unaudited pro forma condensed combined financial statements and related notes were prepared using the acquisition method of accounting under the provisions of Accounting Standards Codification (“ASC”) Topic 805, Business Combinations (“ASC 805”), with FIS considered the accounting acquirer of the Issuer Solutions Business. ASC 805 requires, among other things, that the assets acquired and liabilities assumed in a business combination be recognized at their fair values as of the acquisition date. For purposes of the unaudited pro forma condensed combined balance sheet, the purchase consideration exchanged for the Issuer Solutions Business has been allocated to the assets acquired and liabilities assumed based upon management’s preliminary estimate of their fair values as of December 31, 2025. The difference between the amount of consideration transferred and the fair value of the assets acquired and liabilities assumed is reflected as an adjustment to goodwill. Management’s preliminary estimate of the fair values of the intangible assets acquired was based on publicly available benchmarking information as well as a variety of other assumptions, including market participant assumptions. ASC 805 also requires FIS to measure the assets acquired and the liabilities assumed in accordance with FIS’ accounting policies. In preparing these unaudited pro forma condensed combined financial statements, management performed a preliminary analysis of Issuer Solutions’ accounting policies as compared to those of FIS. However, at the time of preparing these unaudited pro forma condensed combined financial statements, FIS had not identified all adjustments necessary to conform Issuer Solutions’ accounting policies to FIS’ accounting policies.
Because the purchase price allocation and policy evaluation are preliminary, the related adjustments reflected in these unaudited pro forma condensed combined financial statements are also preliminary and have been made solely for the purpose of preparing these unaudited pro forma condensed combined financial statements and are subject to revision based on a final determination of fair value and final policy review, either or both of which could have a material impact on the accompanying unaudited pro forma condensed combined financial statements and FIS’ financial position and results of operations. Further, there were no material transactions and balances between FIS and the Issuer Solutions Business as of and for year ended December 31, 2025.
The unaudited pro forma condensed combined financial statements contained herein do not reflect the costs of any integration activities or benefits that may result from the realization of future cost savings from operating efficiencies or any other synergies or dis-synergies that may result from the Transactions.
The unaudited pro forma condensed combined financial statements and related notes are being provided for illustrative purposes only and do not purport to represent what FIS’ actual results of operations or financial position would have been had the acquisition been completed on the dates indicated, nor are they necessarily indicative of FIS’ future results of operations or financial position for any future period.
All amounts presented within these Notes to Unaudited Pro Forma Condensed Combined Financial Statements are in millions or as denoted otherwise.
Note 2 – Issuer Solutions Reclassification and Perimeter Adjustments
During the preparation of these unaudited pro forma condensed combined financial statements, management performed a preliminary analysis of Issuer Solutions’ accounting policies as compared to those of FIS. At the time of preparing these unaudited pro forma condensed combined financial statements, FIS had not identified all adjustments necessary to conform Issuer Solutions’ accounting policies to FIS’ accounting policies. The below adjustments represent FIS’ best estimates based upon the information currently available to FIS and could be subject to change once more detailed information is available.
In addition, the historical financial statements of the Issuer Solutions Business include certain insignificant businesses, operations and net assets which were retained by Global Payments upon close of the Issuer Solutions Acquisition. Similarly, the financial statements also exclude certain other insignificant businesses, operations and net assets that transferred to FIS upon close of the Issuer Solutions Acquisition in accordance with the FIS Transaction Agreement. Therefore, these unaudited pro forma condensed combined financial statements include certain adjustments (“Perimeter Adjustments”) to reflect the Issuer Solutions Business that ultimately transferred to FIS.
Refer to the table below for a summary of reclassification and Perimeter adjustments made to present Issuer Solutions Business’ combined balance sheet as of December 31, 2025:
5
| Issuer Solutions Business Historical Combined Balance Sheet Line Items |
FIS Historical Consolidated Balance Sheet Line Items |
Issuer Solutions Business Historical Combined Balance Sheet |
Reclassification | Note 2 | Issuer Solutions Business Before Perimeter Adjustments |
Perimeter Adjustments |
Issuer Solutions Business Adjusted Historical Combined Balance Sheet |
|||||||||||||||||
| (in millions) | ||||||||||||||||||||||||
| Assets |
||||||||||||||||||||||||
| Current Assets: |
||||||||||||||||||||||||
| Cash and cash equivalents |
Cash and cash equivalents |
$ | 441 | $ | — | $ | 441 | $ | (38 | ) | $ | 403 | ||||||||||||
| Settlement processing assets |
Settlement assets |
183 | — | 183 | — | 183 | ||||||||||||||||||
| Accounts receivable, net |
Trade receivables, net of allowance for credit losses |
333 | — | 333 | — | 333 | ||||||||||||||||||
| Prepaid expenses and other current assets |
Prepaid expenses and other current assets |
293 | — | 293 | — | 293 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total current assets |
$ | 1,250 | $ | — | $ | 1,250 | $ | (38 | ) | $ | 1,212 | |||||||||||||
| Property and equipment, net |
Property and equipment, net |
1,031 | (646 | ) | (a) | 385 | — | 385 | ||||||||||||||||
| Goodwill |
Goodwill |
8,923 | — | 8,923 | (9 | ) | 8,914 | |||||||||||||||||
| Other intangible assets, net |
Intangible assets, net |
3,828 | (109 | ) | (a) | 3,719 | — | 3,719 | ||||||||||||||||
| Software, net |
— | 755 | (a) | 755 | — | 755 | ||||||||||||||||||
| Equity method investment |
— | 14 | (b) | 14 | — | 14 | ||||||||||||||||||
| Other noncurrent assets |
Other noncurrent assets |
619 | (142 | ) | (b),(c),(d) | 477 | — | 477 | ||||||||||||||||
| Deferred income taxes |
15 | (15 | ) | (c) | — | — | — | |||||||||||||||||
| Deferred contract costs, net |
— | 143 | (d) | 143 | — | 143 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total Assets |
$ | 15,666 | $ | — | $ | 15,666 | $ | (47 | ) | $ | 15,619 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Liabilities and Equity |
||||||||||||||||||||||||
| Current Liabilities: |
||||||||||||||||||||||||
| Accounts payable and accrued liabilities |
Accounts payable, accrued and other liabilities |
322 | (50 | ) | (e) | 272 | 4 | 276 | ||||||||||||||||
| Settlement processing obligations |
Settlement payables |
404 | — | 404 | — | 404 | ||||||||||||||||||
| Deferred revenue |
— | 50 | (e) | 50 | — | 50 | ||||||||||||||||||
| Current portion of long-term debt |
Current portion of long-term debt |
97 | — | 97 | — | 97 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total current liabilities |
$ | 823 | $ | — | $ | 823 | $ | 4 | $ | 827 | ||||||||||||||
| Long-term debt |
Long-term debt, excluding current portion |
49 | — | 49 | — | 49 | ||||||||||||||||||
| Deferred income taxes |
Deferred income taxes |
251 | — | 251 | — | 251 | ||||||||||||||||||
| Due to Parent |
137 | (137 | ) | (f) | — | — | — | |||||||||||||||||
| Other noncurrent liabilities |
Other noncurrent liabilities |
113 | 137 | (f) | 250 | — | 250 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total Liabilities |
$ | 1,373 | $ | — | $ | 1,373 | $ | 4 | $ | 1,377 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Equity: |
||||||||||||||||||||||||
| Parent invested equity: |
||||||||||||||||||||||||
| Net Parent Investment |
14,290 | — | 14,290 | (51 | ) | 14,239 | ||||||||||||||||||
| Accumulated other comprehensive loss |
Accumulated other comprehensive earnings (loss) |
3 | — | 3 | — | 3 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total invested equity |
$ | 14,293 | $ | — | $ | 14,293 | $ | (51 | ) | $ | 14,242 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total liabilities and equity |
$ | 15,666 | $ | — | $ | 15,666 | $ | (47 | ) | $ | 15,619 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| (a) | Reflects the reclassification of $646 million of purchased and developed software previously recognized within Property and equipment (net) and $109 million of purchased and developed software previously recognized within Intangible assets (net), into the Software, net line item to conform with the FIS presentation. |
6
| (b) | Reflects the reclassification of $14 million of Equity method investment recognized as Other noncurrent assets into a separate financial statement line item. |
| (c) | Reflects the reclassification of $15 million of Deferred income tax assets into Other noncurrent assets as presented in the FIS financial statements. |
| (d) | Reflects the reclassification of $143 million of capitalized costs to obtain customer contracts and capitalized costs to fulfill customer contracts from Other noncurrent assets to Deferred contract costs. |
| (e) | Reflects the reclassification of $50 million of Deferred revenue from Accounts payable and accrued liabilities into a separate financial statement line item. |
| (f) | Reflects the reclassification of $137 million in Due to Parent to Other noncurrent liabilities. |
Refer to the table below for a summary of reclassification adjustments made to Issuer Solutions Business’ combined statement of income for the year ended December 31, 2025, to conform presentation:
| Issuer Solutions Business Combined Statement of Income Line Items |
FIS Historical Line Items |
Issuer Solutions Business Historical Combined Statement of Income |
Reclassification | Note 2 | Issuer Solutions Business Before Perimeter Adjustments |
Perimeter Adjustments |
Issuer Solutions Business Adjusted Historical Combined Statement of Income |
|||||||||||||||||
| (in millions) | ||||||||||||||||||||||||
| Revenues |
Revenue |
$ | 2,548 | $ | (43 | ) | (c) | $ | 2,505 | $ | 4 | $ | 2,509 | |||||||||||
| Operating expenses: |
||||||||||||||||||||||||
| Cost of service |
Cost of revenue |
1,797 | — | 1,797 | (19 | ) | 1,778 | |||||||||||||||||
| Selling, general and administrative |
Selling, general, and administrative expenses |
565 | 18 | (b) | 583 | (21 | ) | 562 | ||||||||||||||||
| Asset impairments |
— | — | — | — | — | |||||||||||||||||||
| Other operating (income) expense, net — related party |
— | (43 | ) | (c) | (43 | ) | — | (43 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Operating income |
186 | (18 | ) | 168 | 44 | 212 | ||||||||||||||||||
| Interest and other income |
Interest income |
9 | (5 | ) | (a) | 4 | (3 | ) | 1 | |||||||||||||||
| Interest and other expense |
Interest expense |
(29 | ) | 18 | (b) | (11 | ) | — | (11 | ) | ||||||||||||||
| Other income (expense), net |
— | 5 | (a) | 5 | — | 5 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total other income (expense), net |
Total other income (expense), net |
(20 | ) | 18 | (2 | ) | (3 | ) | (5 | ) | ||||||||||||||
| Income tax expense |
Provision (benefit) for income taxes |
19 | — | 19 | 7 | 26 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Net income |
Net earnings (loss) attributable to FIS continuing operations |
$ | 147 | $ | — | $ | 147 | $ | 34 | $ | 181 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| (a) | Represents a reclassification of $5 million of other income from Interest and other income to Other income (expense), net. |
| (b) | Represents a reclassification of $18 million of other expense from Interest and other expense to Selling, general and administrative expenses. |
| (c) | Represents a reclassification of $43 million of other income expected from transition service agreements from Revenue to Other operating (income) expense, net—related party. |
7
Note 3 – Preliminary Transaction Consideration and Allocation
Preliminary Transaction Consideration
The following table summarizes the preliminary transaction consideration for the Issuer Solutions Business:
| (in millions) |
Amount | |||
| Estimated consideration to Global Payments (i) |
$ | 13,456 | ||
| Estimated converted Issuer Solutions awards attributable to pre-combination service (ii) |
8 | |||
|
|
|
|||
| Preliminary Transaction consideration |
$ | 13,464 | ||
|
|
|
|||
| (i) | Represents base consideration of $13.5 billion paid to Global Payments at the Closing Date, adjusted for cash, debt, and working capital (relative to a target) under the FIS Transaction Agreement. |
| (ii) | Pursuant to the FIS Transaction Agreement, Global Payments equity awards granted in 2024 or earlier and held by transferred employees accelerated and fully vested as of the closing of the Transactions. Awards not meeting these criteria were forfeited, and FIS granted replacement restricted stock unit (“RSU”) awards with substantially similar terms. The number of shares were determined using the exchange ratio based on volume-weighted average trading prices of Global Payments and FIS common stock. A portion of the fair value of the accelerated and replacement awards represent transaction consideration; the remainder will be recognized as post-acquisition compensation expense. |
Preliminary Transaction Consideration Allocation
The assumed accounting for the Issuer Solutions Acquisition, including the preliminary transaction consideration, is based on provisional amounts, and the associated purchase accounting is not final and is subject to change as additional information becomes available and as additional analyses are performed. The preliminary allocation of the purchase price to the acquired assets and assumed liabilities was based upon management’s preliminary estimate of fair values. Management’s preliminary estimate of fair value of assets acquired and liabilities assumed was based on publicly available benchmarking information as well as a variety of other assumptions, including market participant assumptions, which management believes are reasonable under the circumstances. Management is expected to use widely accepted income-based, market-based, and cost-based valuation approaches upon finalization of purchase accounting for the Issuer Solutions Acquisition. Actual results may differ materially from the assumptions within the accompanying unaudited pro forma condensed combined financial information.
The following table summarizes the preliminary transaction consideration allocation as if the Issuer Solutions Acquisition had been completed on December 31, 2025, with excess recorded to Goodwill:
| (in millions) |
Historical Value |
Fair Value Adjustments |
Fair Value |
|||||||||
| Preliminary transaction consideration |
$ | 13,464 | ||||||||||
| Assets |
||||||||||||
| Cash and cash equivalents |
$ | 403 | — | $ | 403 | |||||||
| Settlement assets |
183 | — | 183 | |||||||||
| Trade receivables, net of allowance for credit losses |
333 | — | 333 | |||||||||
| Prepaid expenses and other current assets |
293 | (24 | ) | 269 | ||||||||
| Property and equipment, net |
385 | — | 385 | |||||||||
| Intangible assets, net |
3,719 | 401 | 4,120 | |||||||||
| Software, net |
755 | 578 | 1,333 | |||||||||
| Equity method investment |
14 | — | 14 | |||||||||
| Deferred contract costs, net |
143 | (143 | ) | — | ||||||||
| Other noncurrent assets |
477 | — | 477 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total Assets |
6,705 | 812 | 7,517 | |||||||||
| Liabilities |
||||||||||||
| Accounts payable, accrued and other liabilities |
276 | — | 276 | |||||||||
| Deferred revenue |
50 | — | 50 | |||||||||
| Current portion of long-term debt |
97 | — | 97 | |||||||||
| Settlement payables |
404 | — | 404 | |||||||||
| Long-term debt, excluding current portion |
49 | — | 49 | |||||||||
| Deferred income taxes |
251 | — | 251 | |||||||||
| Other noncurrent liabilities |
250 | (137 | ) | 113 | ||||||||
|
|
|
|
|
|
|
|||||||
| Total Liabilities |
1,377 | (137 | ) | 1,240 | ||||||||
| Noncontrolling interest |
— | — | — | |||||||||
|
|
|
|
|
|
|
|||||||
| Net Assets Acquired |
5,328 | 949 | 6,277 | |||||||||
|
|
|
|||||||||||
| Goodwill |
$ | 7,187 | ||||||||||
|
|
|
|||||||||||
8
Note 4 – Adjustments to the Unaudited Pro Forma Condensed Combined Balance Sheet
Adjustments included in the Transaction Accounting Adjustments – Financing column, Transaction Accounting Adjustments – Worldpay Disposition column and Transaction Accounting Adjustments – Issuer Solutions Acquisition column in the accompanying unaudited pro forma condensed combined balance sheet as of December 31, 2025, are as follows:
(a) Reflects adjustment to Cash and cash equivalents:
| (in millions) |
Amount | |||
| Pro forma transaction accounting adjustments - Financing: |
||||
| Cash from new senior notes, net of debt issuance costs (i) |
$ | 7,900 | ||
|
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|
|||
| Net pro forma transaction accounting adjustments - Financing |
$ | 7,900 | ||
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|
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| Pro forma transaction accounting adjustments – Worldpay Disposition: |
||||
| Income tax payable upon Worldpay Disposition (ii) |
$ | (700 | ) | |
|
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|
|||
| Net pro forma transaction accounting adjustments – Worldpay Disposition |
$ | (700 | ) | |
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|
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| Pro forma transaction accounting adjustments - Transaction - Issuer Solutions Acquisition: |
||||
| Net cash consideration to Global Payments (iii) |
$ | (7,694 | ) | |
| Estimated transaction costs (iv) |
(36 | ) | ||
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|
|||
| Net pro forma transaction accounting adjustments - Transaction - Issuer Solutions Acquisition |
$ | (7,730 | ) | |
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| (i) | These pro formas assume the DDTL is replaced by permanent financing in the form of new senior unsecured notes with aggregate principal of $8 billion. The proceeds from the senior notes are shown net of estimated debt issuance costs of approximately $77 million and a debt discount of $23 million. |
| (ii) | Represents the payment of expected income taxes arising from the Worldpay Disposition. Adjustment results from the reclassification of the deferred tax liability maintained for the difference between the tax basis of the Worldpay equity method investment and the corresponding financial statement carrying value, as adjusted for a $202 million increase in income tax payable. The net adjustment reflects the income taxes FIS expects to incur as a result of the gain on the Worldpay Disposition. Such taxes are expected to be paid shortly after transaction close, and as such are reflected as an adjustment to Cash and cash equivalents in these pro forma condensed combined financial statements. |
| (iii) | Represents consideration of $13.5 billion paid for Issuer Solutions, which is the base consideration of $13.5 billion adjusted for cash, debt, and working capital (relative to a target) at the Closing Date under the FIS Transaction Agreement, less $5.8 billion, which represents the FIS pre-tax portion of the Worldpay purchase price adjusted for estimated closing levels of working capital cash and debt of Worldpay. |
| (iv) | These costs consist of FIS legal advisory, financial advisory, accounting and consulting costs. |
(b) Preliminary adjustment to Prepaid and other current assets as follows:
| (in millions) |
Amount | |||
| Pro forma transaction accounting adjustments - Transaction — Financing: |
||||
| Terminated capitalized DDTL Fees (i) |
$ | (6 | ) | |
|
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|
|||
| Net pro forma transaction accounting adjustments - Transaction to Prepaid and other current assets - Financing |
$ | (6 | ) | |
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|
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| Pro forma transaction accounting adjustments - Transaction — Worldpay Disposition: |
||||
| Sale of Worldpay equity method investment (ii) |
$ | 5,762 | ||
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|
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| Net pro forma transaction accounting adjustments - Transaction to Prepaid and other current assets – Worldpay Disposition |
$ | 5,762 | ||
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|
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| Pro forma transaction accounting adjustments - Transaction - Issuer Solutions Acquisition: |
||||
| Sale of Worldpay equity method investment (ii) |
$ | (5,762 | ) | |
| Write-off capitalized contract costs (iii) |
(24 | ) | ||
|
|
|
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| Net pro forma transaction accounting adjustments - Transaction to Prepaid and other current assets - Issuer Solutions Acquisition |
$ | (5,786 | ) | |
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|
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9
| (i) | Reflects the write-off of deferred financing fees related to the DDTL that were incurred by FIS as these condensed combined pro forma financial statements assume the DDTL is replaced by permanent financing in connection with the Issuer Solutions Acquisition. |
| (ii) | Under the FIS Transaction Agreement, the proceeds from the sale of FIS’ remaining equity method investment in Worldpay were deducted from the final cash consideration paid to Global Payments for the Issuer Solutions Business. As such, these unaudited pro forma condensed combined financial statements reflect a deposit representing the prepayment of proceeds from the sale of FIS’ remaining interest in Worldpay in Prepaid and other current assets in the Transaction Accounting Adjustments – Worldpay Disposition column and a removal of that prepaid asset in the Transaction Accounting Adjustments – Issuer Solutions Acquisition column as both transactions with Global Payments are funded. |
| (iii) | Reflects the write-off of Issuer Solutions Business’ capitalized contract costs which do not qualify for recognition as assets under the acquisition method of accounting. |
(c) Preliminary adjustment to Goodwill, which represents the difference between the Issuer Solutions Business’ historical Goodwill and the excess of the preliminary transaction consideration over the preliminary fair value of the underlying assets acquired and liabilities assumed:
| (in millions) |
Amount | |||
| Pro forma transaction accounting adjustments - Transaction - Issuer Solutions Acquisition: |
||||
| Goodwill resulting from the Transaction (Note 3) |
$ | 7,187 | ||
| Elimination of the Issuer Solutions Business’ historical Goodwill |
(8,914 | ) | ||
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|
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| Net pro forma transaction accounting adjustments - Transaction - Issuer Solutions Acquisition |
$ | (1,727 | ) | |
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| (d) | Reflects the preliminary purchase accounting adjustment for estimated intangibles based on the acquisition method of accounting: |
| (in millions) |
Preliminary Fair Value |
Estimated Useful Life (Years) |
||||||
| Pro forma transaction accounting adjustments - Transaction - Issuer Solutions Acquisition: |
||||||||
| Estimated Fair Value - Customer relationships (i) |
$ | 4,050 | 18 | |||||
| Estimated Fair Value - Trade name (i) |
70 | 3 | ||||||
| Less: Historical Issuer Solutions Business’ Intangible assets, net of amortization |
(3,719 | ) | ||||||
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|||||||
| Net pro forma transaction accounting adjustments - Transaction to Intangible assets, net - Issuer Solutions Acquisition |
$ | 401 | ||||||
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| (i) | FIS determined a preliminary fair value estimate of intangible assets based on publicly available benchmarking information as well as a variety of other assumptions, including market participant assumptions. The fair value estimate for intangible assets may significantly change at the Closing Date as compared to the estimate used for purposes of these unaudited pro forma condensed combined financial statements. |
(e) Reflects the preliminary purchase accounting adjustment for estimated acquired technology based on the acquisition method of accounting:
| (in millions) |
Preliminary Fair Value |
Estimated Useful Life (Years) |
||||||
| Pro forma transaction accounting adjustments — Transaction — Issuer Solutions Acquisition: |
||||||||
| Estimated Fair Value – Technology (i) |
$ | 1,150 | 10 | |||||
| Less: Historical Issuer Solutions acquired technology, net of amortization |
(108 | ) | ||||||
| Less: Historical Issuer Solutions Business’ internal software, net of amortization |
(464 | ) | ||||||
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| Net pro forma transaction accounting adjustments — Transaction to Software, net — Issuer Solutions Acquisition |
$ | 578 | ||||||
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| (i) | FIS determined a preliminary fair value estimate of intangible assets based on publicly available benchmarking information as well as a variety of other assumptions, including market participant assumptions. The fair value estimate for intangible assets may significantly change at the Closing Date as compared to the estimate used for purposes of these unaudited pro forma condensed combined financial statements. |
(f) Reflects the removal of FIS’ remaining minority ownership in Worldpay accounted for under the equity method of accounting.
(g) Preliminary adjustment to deferred contract costs, net, representing the write-off of Issuer Solutions Business’ capitalized contract costs which do not qualify for recognition as assets under the acquisition method of accounting:
10
| (in millions) |
Amount | |||
| Pro forma transaction accounting adjustments - Transaction - Issuer Solutions Acquisition: |
||||
| Write-off capitalized contract costs |
$ | (143 | ) | |
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|
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| Net pro forma transaction accounting adjustments - Transaction to Deferred contract costs, net - Issuer Solutions Acquisition |
$ | (143 | ) | |
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| (h) | Preliminary adjustment to Accounts payable, accrued and other liabilities based on the following: |
| (in millions) |
Amount | |||
| Pro forma transaction accounting adjustments - Transaction – Issuer Solutions Acquisition: |
||||
| Payment of accrued transaction costs (i) |
$ | (36 | ) | |
|
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| Net pro forma transaction accounting adjustments - Transaction to Accounts payable, accrued and other liabilities – Issuer Solutions Acquisition |
$ | (36 | ) | |
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| Pro forma transaction accounting adjustments - Transaction - Worldpay Disposition: |
||||
| Payment of accrued transaction costs (i) |
$ | (21 | ) | |
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|
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| Net pro forma transaction accounting adjustments - Transaction to Accounts payable, accrued and other liabilities - Worldpay Disposition |
$ | (21 | ) | |
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| (i) | Reflects the payment of accrued transaction costs on the historical balance sheet of FIS. |
(i) Reflects the long-term debt financing, net of unamortized debt issuance costs, to repay the DDTL, which was used to fund a portion of the Transactions at the Closing Date. For purposes of these unaudited pro forma condensed combined financial statements, FIS has assumed that the new FIS permanent financing will consist of $8 billion aggregate principal of senior unsecured notes. The amount, type and terms of permanent financing could be different from that presented in these pro forma condensed combined financial statements:
| (in millions) |
Amount | |||
| Pro forma transaction accounting adjustments - Financing: |
||||
| New senior notes |
$ | 8,000 | ||
| Less: Debt issuance costs and original issue discount |
(100 | ) | ||
|
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|
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| Net pro forma transaction accounting adjustments - Long-term debt, excluding current portion |
$ | 7,900 | ||
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(j) Reflects the reclassification of the deferred tax liability maintained for the difference between the tax basis of the Worldpay equity method investment and the corresponding financial statement carrying value to income tax payable upon sale. Refer to Note 4(a)(ii) which describes the income tax payable ultimately being paid for purposes of these pro forma condensed combined financial statements.
(k) Represents the elimination of historical due to parent balances. The due to parent transactions presented on the Issuer Solutions Business’ historical financial statements are not expected to remain in place following the implementation of purchase accounting.
(l) Reflects the elimination of the Issuer Solutions Business’ historical equity.
(m) Reflects stock-based compensation impacts for (i) accelerated and cancelled Global Payments equity awards held by Issuer Solutions employees and (ii) estimated converted Global Payments equity awards that were attributable to pre-combination services. See Note 3(ii) for more information.
(n) Reflects adjustments to (accumulated deficit) retained earnings as follows:
| (in millions) |
Amount | |||
| Pro forma transaction accounting adjustments - Financing: |
||||
| Terminated capitalized DDTL Fees (i) |
$ | (6 | ) | |
|
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|
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| Net pro forma financing accounting adjustments - Transaction to (Accumulated deficit) retained earnings |
$ | (6 | ) | |
|
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| Pro forma transaction accounting adjustments - Transaction - Worldpay Disposition: |
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| Gain on sale of Worldpay equity method investment (ii) |
$ | 2,009 | ||
|
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|
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| Net pro forma transaction accounting adjustments - Transaction to (Accumulated deficit) retained earnings - Worldpay Disposition |
$ | 2,009 | ||
|
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|
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| Pro forma transaction accounting adjustments - Transaction - Issuer Solutions Acquisition: |
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| Share based compensation to transferred employees (iii) |
(4 | ) | ||
|
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|
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| Net pro forma transaction accounting adjustments - Transaction to (Accumulated deficit) retained earnings - Issuer Solutions Acquisition |
$ | (4 | ) | |
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| (i) | Reflects the one-time financing fees related to the DDTL that were incurred and capitalized by FIS as these condensed combined pro forma financial statements assume the DDTL is replaced by permanent financing in connection with the Issuer Solutions Acquisition. |
| (ii) | Reflects the gain on the sale of the Worldpay equity method investment. See Note 4(a)(ii) for more information. |
| (iii) | Reflects stock-based compensation expense related to converted accelerated and cancelled Global Payments equity awards that were held by Issuer Solutions employees. See Note 3(ii) for more information. |
(o) Reflects the write-off of FIS’ pro rata share of Worldpay’s other comprehensive earnings (loss) associated with the sale of its equity method investment in Worldpay.
Note 5 – Pro Forma Adjustments to the Unaudited Condensed Combined Statement of Earnings (Loss)
Adjustments included in the Transaction Accounting Adjustments – Financing column, Transaction Accounting Adjustments – Worldpay Disposition column, and Transaction Accounting Adjustments – Issuer Solutions Acquisition column in the accompanying unaudited pro forma condensed combined statement of earnings (loss) for the year ended December 31, 2025 are as follows:
(a) The following table reflects adjustments to the Cost of revenue related to amortization expense for intangible assets. The newly acquired intangible assets have been amortized based on estimated useful lives ranging from 3 to 18 years. See Note 4(d) and 4(e) for details on carrying values and useful lives of intangibles and software. Management is still in the process of evaluating the fair value and estimated useful lives of the intangible assets. Any resulting change would have a direct impact to amortization expense, which could be material.
| (in millions) |
For the Year ended December 31, 2025 |
|||
| Pro forma transaction accounting adjustments - Transaction - Issuer Solutions Acquisition: |
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| Amortization expense of Customer Relationships |
$ | 225 | ||
| Amortization expense of Technology |
115 | |||
| Amortization expense of Trade Name |
23 | |||
| Less: Historical Intangible asset amortization |
(533 | ) | ||
| Less: Historical Software amortization |
(16 | ) | ||
| Less: Historical amortization of capitalized contract costs |
(26 | ) | ||
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| Net pro forma transaction accounting adjustments – Transaction to Cost of revenue - Issuer Solutions Acquisition |
$ | (212 | ) | |
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A 10% change in the valuation of intangible assets would cause a corresponding increase or decrease in the amortization expense of approximately $36 million for the year ended December 31, 2025. Pro forma amortization is preliminary and based on the use of straight-line amortization. The amount of amortization following the Issuer Solutions Acquisition may differ significantly between periods based upon the final value assigned and amortization methodology used for each identifiable intangible asset.
(b) Reflects the adjustments to Selling, general, and administrative expenses (“SG&A”) including a) incremental stock-based compensation charge for Global Payments equity awards converted to FIS equity awards (see Note 3(ii) for more information), b) elimination of historical software amortization, and c) other individually immaterial adjustments.
(c) Reflects the adjustments to interest expense as follows:
| (in millions) |
For the Year ended December 31, 2025 |
|||
| Pro forma transaction accounting adjustments — Financing: |
||||
| New interest expense on Financing (i) |
$ | (399 | ) | |
| Terminated DDTL Fees (ii) |
(6 | ) | ||
|
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|
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| Net pro forma transaction accounting adjustments — Interest expense — Financing |
$ | (405 | ) | |
|
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| (i) | The interest expense included in the unaudited pro forma condensed combined financial information was calculated using an effective interest rate, which considers transaction costs and issuance discounts, and reflects an approximate weighted-average interest rate of 5.01% based on what FIS currently expects to be the most likely terms and current prevailing interest rates. Actual interest rates may vary from those depicted in the pro forma amounts. |
| (ii) | Reflects the write-off of deferred financing fees related to the DDTL that were incurred by FIS as these condensed combined pro forma financial statements assume the DDTL is replaced by permanent financing in connection with the Issuer Solutions Acquisition. |
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A sensitivity analysis on interest expense for the year ended December 31, 2025 has been performed to assess the effect of a 12.5 basis point change of the hypothetical interest on the senior notes. The following table shows the change in the Interest expense for the Financing described above:
| (in millions) |
For the Year ended December 31, 2025 |
|||
| Interest expense assuming: |
||||
| Increase of 0.125% |
$ | (50 | ) | |
| Decrease of 0.125% |
$ | 50 | ||
(d) Reflects the adjustments to provision (benefit) for income tax as follows:
| (in millions) |
For the Year ended December 31, 2025 |
|||
| Pro forma transaction accounting adjustments - Financing – Issuer Solutions Acquisition: |
||||
| Tax impact of transaction accounting adjustments – Financing (i) |
$ | (97 | ) | |
|
|
|
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| Net pro forma transaction accounting adjustments – Provision (benefit) for income taxes - Financing |
$ | (97 | ) | |
|
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|
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| Pro forma transaction accounting adjustments – Transaction – Issuer Solutions Acquisition: |
||||
| Issuer Solutions Historical tax adjustment (ii) |
$ | 24 | ||
| Tax impact of transaction accounting adjustments – Transaction – Issuer Solutions Acquisition (i) |
46 | |||
|
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|
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| Net pro forma transaction accounting adjustments – Provision (benefit) for income taxes - Transaction |
$ | 70 | ||
|
|
|
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| (i) | Represents an adjustment to record the estimated income tax impact of the pro forma adjustments, utilizing a blended statutory income tax rate in effect of 24% for the year ended December 31, 2025. FIS’ effective tax rate following the acquisition could differ significantly (either higher or lower) depending on post-acquisition activities, including cash needs, the geographical mix of income, and changes in tax law. Because the tax rates used for the pro forma financial information are estimated, the actual effective tax rate in future periods may vary from the pro forma rate. |
| (ii) | Represents an adjustment to Issuer Solutions Business’ historical provision (benefit) for income tax to reflect income taxes utilizing a blended statutory income tax rate in effect of 24% for the year ended December 31, 2025. Prior to FIS’ acquisition, the Issuer Solutions Business contained entities which are not taxpaying entities for federal income tax purposes and accordingly did not recognize expenses for taxes for those entities. Additionally, the perimeter adjustments to reflect the Issuer Solutions Business that ultimately transferred to FIS do not reflect a corresponding adjustment to provision (benefit) for income taxes. As such, an adjustment was made to normalize the historical provision (benefit) for income taxes at the blended statutory tax rate. |
(e) Reflects the adjustments to equity method investment earnings (loss), net of tax as follows:
| (in millions) |
For the year ended December 31, 2025 |
|||
| Pro forma transaction accounting adjustments — Transaction — Worldpay Disposition: |
||||
| Gain on sale of Worldpay equity method investment (i) |
$ | 2,009 | ||
| Elimination of historical Issuer Solutions Business’ equity method investment loss, net of tax (ii) |
526 | |||
|
|
|
|||
| Net pro forma transaction accounting adjustments — Transaction to Equity method investment earnings (loss), net of tax—Worldpay Disposition |
$ | 2,535 | ||
|
|
|
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| (i) | Reflects the gain on the sale of the Worldpay equity method investment, net of tax, as if the sale occurred on January 1, 2025. |
| (ii) | Reflects the elimination of FIS’ historical equity method investment (loss) after application of investor-level taxes. |
(f) The pro forma basic and diluted earnings per share calculations are based on the basic and diluted weighted average shares of FIS. The pro forma basic and diluted weighted average shares outstanding are based on the historic weighted average shares of FIS common stock. In connection with the Issuer Solutions Acquisition, FIS granted replacement FIS equity awards for certain RSU awards held by Issuer Solutions employees with substantially similar terms. The impact of the replacement awards on basic and diluted weighted average shares is not expected to be material in the context of the transaction and thus has not been reflected in the basic and diluted weighted average shares. See Note 3(ii) for more information.
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