Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Unless stated otherwise or the context otherwise requires, all references to "FIS," "we," "our," "us," the "Company" or the "registrant" are to Fidelity National Information Services, Inc., a Georgia corporation, and its subsidiaries.

The following discussion should be read in conjunction with Item 1. Condensed Consolidated Financial Statements (Unaudited) and the Notes thereto included elsewhere in this report. The statements contained in this Form 10-Q or in our other documents or in oral presentations or other management statements that are not purely historical are forward-looking statements within the meaning of the U.S. federal securities laws. Statements that are not historical facts, including statements about anticipated financial outcomes, including any earnings outlook or projections, projected revenue or expense synergies or dis-synergies, business and market conditions, outlook, foreign currency exchange rates, deleveraging plans, expected dividends and share repurchases of the Company, the Company's sales pipeline and anticipated profitability and growth, plans, strategies and objectives for future operations, strategic value creation, risk profile and investment strategies, any statements regarding future economic conditions or performance and any statements with respect to the previously announced pending sale of a 55% equity stake in the Worldpay Merchant Solutions business ("pending Worldpay transaction"), the expected financial and operational results of the Company, and expectations regarding the Company's business or organization after the pending Worldpay transaction, as well as other statements about our expectations, beliefs, intentions, or strategies regarding the future, or other characterizations of future events or circumstances, are forward-looking statements. These statements may be identified by words such as "expect," "anticipate," "intend," "plan," "believe," "will," "should," "could," "would," "project," "continue," "likely," and similar expressions, and include statements reflecting future results or outlook, statements of outlook and various accruals and estimates. These statements relate to future events and our future results and involve a number of risks and uncertainties. Forward-looking statements are based on management's beliefs as well as assumptions made by, and information currently available to, management.

Actual results, performance or achievement could differ materially from these forward-looking statements. The risks and uncertainties to which forward-looking statements are subject include the following, without limitation:

• changes in general economic, business and political conditions, including those resulting from COVID-19 or other pandemics, a recession, intensified international hostilities, acts of terrorism, increased rates of inflation or interest, changes in either or both the United States and international lending, capital and financial markets or currency fluctuations;

• the risk of losses in the event of defaults by merchants (or other parties) to which we extend credit in our card settlement operations or in respect of any chargeback liability, either of which could adversely impact liquidity and results of operations;

• the risk that acquired businesses will not be integrated successfully or that the integration will be more costly or more time-consuming and complex than anticipated;

• the risk that cost savings and synergies anticipated to be realized from acquisitions may not be fully realized or may take longer to realize than expected;

• the risks of doing business internationally;

• the effect of legislative initiatives or proposals, statutory changes, governmental or applicable regulations and/or changes in industry requirements, including privacy and cybersecurity laws and regulations;

• the risks of reduction in revenue from the elimination of existing and potential customers due to consolidation in, or new laws or regulations affecting, the banking, retail and financial services industries or due to financial failures or other setbacks suffered by firms in those industries;

• changes in the growth rates of the markets for our solutions;

• the amount, declaration and payment of future dividends is at the discretion of our Board of Directors and depends on, among other things, our investment opportunities, results of operations, financial condition, cash requirements, future prospects, and other factors that may be considered relevant by our Board of Directors, including legal and contractual restrictions;

• the amount and timing of any future share repurchases is subject to, among other things, our share price, our other investment opportunities and cash requirements, our results of operations and financial condition, our future prospects and other factors that may be considered relevant by our Board of Directors and management;

• failures to adapt our solutions to changes in technology or in the marketplace;

• internal or external security or privacy breaches of our systems, including those relating to unauthorized access, theft, corruption or loss of personal information and computer viruses and other malware affecting our software or platforms, and the reactions of customers, card associations, government regulators and others to any such events;

• the risk that implementation of software, including software updates, for customers or at customer locations or employee error in monitoring our software and platforms may result in the corruption or loss of data or customer information, interruption of business operations, outages, exposure to liability claims or loss of customers;

• the risk that partners and third parties may fail to satisfy their legal obligations and risks associated with managing pension cost, cybersecurity issues, IT outages and data privacy;

• the reaction of current and potential customers to communications from us or regulators regarding information security, risk management, internal audit or other matters;

• uncertainties as to the timing of the consummation of the pending Worldpay transaction or whether such sale will be completed;

• risks associated with the impact, timing or terms of the pending Worldpay transaction;

• risks associated with the expected benefits and costs of the pending Worldpay transaction, including the risk that the expected benefits of the pending Worldpay transaction or any contingent purchase price will not be realized within the expected timeframe, in full or at all;

• the risk that conditions to the pending Worldpay transaction will not be satisfied and/or that the pending Worldpay transaction will not be completed within the expected timeframe, on the expected terms or at all;

• the risk that any consents or regulatory or other approvals required in connection with the pending Worldpay transaction will not be received or obtained within the expected timeframe, on the expected terms or at all;

• the risk that the financing intended to fund the pending Worldpay transaction may not be obtained;

• the risk that the costs of restructuring transactions and other costs incurred in connection with the pending Worldpay transaction will exceed our estimates or otherwise adversely affect our business or operations;

• the impact of the pending Worldpay transaction on our businesses and the risk that the pending Worldpay transaction may be more difficult, time-consuming or costly than expected, including the impact on our resources, systems, procedures and controls, diversion of management's attention and the impact on relationships with customers, governmental authorities, suppliers, employees and other business counterparties;

• the risk that policies and resulting actions of the current administration in the U.S. may result in additional regulations and executive orders, as well as additional regulatory and tax costs;

• competitive pressures on pricing related to the decreasing number of community banks in the U.S., the development of new disruptive technologies competing with one or more of our solutions, increasing presence of international competitors in the U.S. market and the entry into the market by global banks and global companies with respect to certain competitive solutions, each of which may have the impact of unbundling individual solutions from a comprehensive suite of solutions we provide to many of our customers;

• the failure to innovate in order to keep up with new emerging technologies, which could impact our solutions and our ability to attract new, or retain existing, customers;

• an operational or natural disaster at one of our major operations centers;

• failure to comply with applicable requirements of payment networks or changes in those requirements;

• fraud by merchants or bad actors; and

• other risks detailed elsewhere in the "Risk Factors" and other sections of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, in our Quarterly Reports on Form 10-Q and in our other filings with the Securities and Exchange Commission.

Other unknown or unpredictable factors also could have a material adverse effect on our business, financial condition, results of operations and prospects. Accordingly, readers should not place undue reliance on these forward-looking statements. These forward-looking statements are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. Except as required by applicable law or regulation, we do not undertake (and expressly disclaim) any obligation and do not intend to publicly update or review any of these forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

FIS is a leading provider of technology solutions for financial institutions and businesses of all sizes and across any industry globally. We enable the movement of commerce by unlocking the financial technology that powers the world's economy. Our employees are dedicated to advancing the way the world pays, banks and invests through our trusted innovation, system performance and flexible architecture. We help our clients use technology in innovative ways to solve business-critical challenges and deliver superior experiences for their customers. Headquartered in Jacksonville, Florida, FIS is a member of the Fortune 500® and the Standard & Poor's 500® Index.

We have grown both organically and through acquisitions. Organic growth has been driven by a number of factors, including growth of our customers' businesses, our internal development of new solutions that enhance our client offerings, and our sales and marketing efforts to expand our customer base and addressable markets. Acquisitions have contributed additional solutions that complement or enhance our offerings, diversify our client base, expand our geographic coverage, and provide entry into new and attractive adjacent markets that align with our strategic objectives. We continue to strategically allocate resources to both organic and inorganic growth initiatives to enhance the long-term value of our business.

On July 5, 2023, FIS signed a definitive agreement to sell a 55% equity interest in its Worldpay Merchant Solutions business to private equity funds managed by GTCR. The assets and liabilities of the disposal group are presented separately on the consolidated balance sheets, and the operating results have been reflected as discontinued operations, for all periods presented. As such, the related results have been excluded from continuing operations and segment results. Cash flows from operating and investing activities for discontinued operations are presented in Note 2 to our consolidated financial statements included herein. See Notes 1 and 2 for further information regarding the Worldpay Merchant Solutions disposal group and its discontinued operations.

The Worldpay Merchant Solutions business includes the former Merchant Solutions segment in addition to an insignificant non-strategic business previously included in the Corporate and Other segment, which have been recast as discontinued operations for all periods presented. Accordingly, the Company no longer reports the Merchant Solutions segment; it now reports its financial performance based on the following segments: Banking Solutions ("Banking"), Capital Market Solutions ("Capital Markets") and Corporate and Other. The Company regularly assesses its portfolio of assets and reclassified certain businesses from Capital Market Solutions to Banking Solutions and to the Corporate and Other Segment in the quarter ended March 31, 2023, and recast all prior-period segment information presented. A description of our segments is included in Note 11 to the consolidated financial statements. Revenue by segment and the Adjusted EBITDA of our segments are discussed below in Segment Results of Operations.

Business Trends and Conditions

Our revenue is primarily derived from a combination of technology and processing solutions, transaction fees, professional services and software license fees. While we are a global company and do business around the world, the majority of our revenue is generated by clients in the U.S. The majority of our international revenue is generated by clients in the U.K., Germany, Canada, Brazil, Australia and Switzerland. In addition, the majority of our revenue has historically been recurring and has been provided under multi-year Banking and Capital Markets contracts that contribute relative stability to our revenue stream. These solutions, in general, are considered critical to our clients' operations. Professional services revenue is typically non-recurring, though recognition often occurs over time rather than at a point in time. Sales of software licenses are typically non-recurring with point-in-time recognition and are less predictable.

The U.S. and Europe, the two largest geographic areas for our businesses, are experiencing slower economic growth than in recent years. Lengthening sales cycles observed in 2022, particularly across large transactions with a total contract value in excess of $50 million, persisted during the first nine months of 2023, particularly in Banking. We also experienced, and continue to experience, higher rates of inflation in these markets, including increasing wage and benefits rates, which management believes is in part due to inflation and in part due to competitive job markets for the skilled employees who support our businesses, as well as increasing non-labor-related costs. Given the nature of our varied businesses, the magnitude of future effects of slower economic growth, including lengthy sales cycles and inflation, are difficult to predict, although they have had and are expected to continue to have an adverse effect on our results of operations. In 2022, the strengthening of the U.S. dollar had a negative impact on our revenue and earnings. During the first half of 2023, a weakening U.S. dollar generated a positive impact on our revenue and earnings. That trend reversed in the third quarter, as the British Pound and Euro in particular weakened against the U.S. dollar. Given the volatility of exchange rates and the mix of currencies involved in both revenues and expenses, the direction and magnitude of future effects of currency fluctuations are uncertain. Rising interest rates have had, and may continue to have, a negative impact on our interest expense.

Slowing growth trends affecting our discontinued operations observed over the second half of 2022, reflecting both slower economic growth, particularly in the U.K., and competitive pressures, continued during the first nine months of 2023, and we anticipate them to continue in the short term. In 2022, we recorded a goodwill impairment charge of $17.6 billion related to the held-for-sale reporting unit, reflecting our intermediate-term growth expectations. In the second quarter of 2023, we recorded an additional $6.8 billion goodwill impairment, reflective of the price at which we agreed to sell a majority interest in the Worldpay Merchant Solutions business as discussed further below. See "Goodwill Impairment" in our Critical Accounting Policies and Note 7 to the consolidated financial statements in the Company's Annual Report on Form 10-K for the year ended December 31, 2022, as well as Critical Accounting Policies and Note 2 to the consolidated financial statements in the Company's Quarterly Report on Form 10-Q for the period ended June 30, 2023, for further details on the goodwill impairments. As discussed in Note 2 of this Quarterly Report on Form 10-Q, there was no goodwill impairment recorded during the period ended September 30, 2023. Also as discussed in Note 2, the Company recorded a $1.5 billion valuation allowance against the assets held for sale in the disposal group, primarily as a result of the exclusion of certain deferred tax liabilities that will not be transferred to GTCR in the transaction. The valuation allowance will continue to be updated as the disposal group continues to be remeasured at each subsequent reporting date until the sale has closed, at which point the assets held for sale, net of the

valuation allowance, and the liabilities held for sale will be derecognized and any additional gain or loss on sale will be recorded.

As a result of the factors noted above, for the Company as a whole, we expect 2023 revenue growth will be slower than 2022 and that net earnings will decline. Over the longer term, we expect improvements in revenue growth and margins in response to improving economic conditions and planned management actions, including our Future Forward program discussed below.

The pending sale of the Worldpay Merchant Solutions business to private equity funds managed by GTCR valued the business at up to $18.5 billion, including potential consideration of $1.0 billion contingent on the returns realized by GTCR exceeding certain thresholds. We now estimate our net proceeds at closing from the sale to be approximately $12.0 billion, consisting of approximately (i) $8.7 billion of proceeds from a pre-closing distribution from the Worldpay business (funded by new debt) and (ii) $4.9 billion from the sale of 55% of our ownership interest, net of estimated selling price adjustments, debt restructuring fees, taxes and transaction costs, the amounts of which may change prior to closing. The net proceeds are subject to adjustments for closing levels of the Worldpay Merchant Solutions business' debt, working capital relative to an agreed target and available cash for operations relative to an agreed minimum of not less than $1.5 billion. We will retain a non-controlling 45% ownership interest in a new standalone joint venture. We intend to use proceeds from the sale to pay down debt and return additional capital to shareholders through our existing share repurchase authorization, as well as for general corporate purposes, while maintaining an investment grade credit rating. In connection with the sale, FIS and Worldpay will enter into commercial agreements, preserving a key value proposition for clients of both businesses and minimizing potential dis-synergies. The transaction is expected to close in the first quarter of 2024, subject to regulatory approvals and other customary closing conditions. Following the closing of this transaction, FIS' ownership interest in Worldpay will be reported as equity method investment income (loss).

In November 2022, we launched an enterprise-wide efficiency program, Future Forward, with a focus on streamlining operations, accelerating time to market of new solutions and improving profitability and cash flow. As of September 30, 2023, on a continuing operations basis, we achieved annualized run-rate Future Forward cash savings of over $220 million exiting the quarter, including over $150 million of operational expense savings and approximately $70 million of capital expense savings. We continue to expect post-separation cash savings exiting 2024 of $1.0 billion, of which over two-thirds represents annualized run-rate savings.

We continue to assist financial institutions in migrating to outsourced integrated technology solutions to improve their profitability and address increasing and ongoing regulatory requirements. As a provider of outsourced solutions, we benefit from multi-year recurring revenue streams, which help moderate the effects of broader year-to-year economic and market changes that otherwise might have a larger impact on our results of operations. We believe our integrated solutions and outsourced services are well-positioned to address this outsourcing trend across the markets we serve.

We continue to invest in modernization, innovation and integrated solutions to meet the demands of the markets we serve and compete with global banks, financial and other technology providers, and emerging technology innovators. We invest both organically and through investment opportunities in companies building complementary technologies in the financial services space. Our internal efforts in research and development activities have related primarily to the modernization of our proprietary core systems in each of our segments, design and development of next-generation digital and innovative solutions and development of processing systems and related software applications and risk management platforms. We expect to continue our practice of investing an appropriate level of resources to maintain, enhance and extend the functionality of our proprietary systems and existing software applications, to develop new and innovative software applications and systems to address emerging technology trends in response to the needs of our clients, and to enhance the capabilities of our outsourcing infrastructure.

Consumer preference continues to shift from traditional branch banking services to digital banking solutions, and our clients seek to provide a single integrated banking experience through their branch, mobile, internet and voice banking channels. We have been providing our large regional banking customers in the U.S. with Digital One, an integrated digital banking platform, and are now adding functionality and offering Digital One to our community bank clients to provide a consistent, omnichannel experience for consumers of banking services across self-service channels like mobile banking and online banking, as well as supporting channels for bank staff operating in bank branches and contact centers. The uniform customer experience extends to support a broad range of financial services including opening new accounts, servicing of existing accounts, money movement, and personal financial management, as well as other consumer, small business and commercial banking capabilities. Digital One is integrated into several of the core banking platforms offered by FIS and is also offered to customers of non-FIS core banking systems.

Consolidation within the banking industry has occurred and may continue, primarily in the form of merger and acquisition activity among financial institutions, which we believe would broadly be detrimental to the profitability of the financial technology industry. However, consolidation resulting from specific merger and acquisition transactions may be beneficial to our business. When consolidations of financial institutions occur, merger partners often operate systems obtained from competing service providers. The newly formed entity generally makes a determination to migrate its core and payments systems to a single platform. When a financial institution processing client is involved in a consolidation, we may benefit by their expanding the use of our solutions if such solutions are chosen to survive the consolidation and to support the newly combined entity. Conversely, we may lose revenue if we are providing solutions to both entities, or if a client of ours is involved in a consolidation and our solutions are not chosen to support the newly combined entity. It is also possible that larger financial institutions resulting from consolidation may have greater leverage in negotiating terms or could decide to perform in-house some or all of the solutions that we currently provide or could provide. We seek to mitigate the risks of consolidations by offering other competitive solutions to take advantage of specific opportunities at the surviving company.

Recent U.S. bank failures could negatively impact our results to the extent more of our customers become illiquid; however, our current exposure to recent failures is limited, and we may be a long-term beneficiary of the recent disruption. As a leading provider of financial technology services to the top 100 U.S. banks by asset size as well as other global financial institutions, FIS boasts a highly diversified customer base, with no single customer accounting for more than approximately 1% of 2022 total Company revenue. With respect to U.S. financial institution customers that closed during the first nine months of 2023, FIS continues to provide services for these banks and is paid during their transition, and our revenue exposure from potential contract terminations related to these banks is not material. Further, FIS' core banking customer contracts are generally structured with fees that increase based on the number of active accounts or transactions rather than the amount of deposits. Thus, to the extent account volume increases, we are positioned to benefit from this growth as a leading core banking services provider to large financial institutions.

We continue to see demand in the payments market for innovative solutions that will deliver faster, more convenient payment options in mobile channels, internet applications, in-store cards, and digital currencies. The payment processing industry is adopting new technologies, developing new solutions, evolving new business models, and being affected by new market entrants and by an evolving regulatory environment. As financial institutions respond to these changes by seeking solutions to help them enhance their own offerings to consumers, including the ability to accept card-not-present payments in eCommerce and mobile environments as well as contactless cards and mobile wallets at the point of sale, FIS believes that payment processors will seek to develop additional capabilities in order to serve clients' evolving needs. To facilitate this expansion, we believe that payment processors will need to enhance their technology platforms so they can deliver these capabilities and differentiate their offerings from other providers.

We believe that these market changes present both an opportunity and a risk for us, and we cannot predict which emerging technologies or solutions will be successful. However, FIS believes that payment processors, like FIS, that have scalable, integrated business models, provide solutions across the payment processing value chain and utilize broad distribution capabilities will be best-positioned to enable emerging alternative electronic payment technologies in the long term. Further, FIS believes that its depth of capabilities and breadth of distribution will enhance its position as emerging payment technologies are adopted by merchants and other businesses. FIS' ability to partner with non-financial institution enterprises, such as mobile payment providers and internet, retail and social media companies, continues to create attractive growth opportunities as these new entrants seek to become more active participants in the development of alternative electronic payment technologies and to facilitate the convergence of retail, online, mobile and social commerce applications.

Globally, attacks on information technology systems, such as those operated by FIS, continue to grow in frequency, complexity and sophistication. This is a trend we expect to continue. These circumstances present both a threat and an opportunity for FIS. We maintain significant focus on and investment in information security that is designed to mitigate threats to our systems and solutions. Through the expertise we have gained with this ongoing focus and investment, we have developed and offer fraud, security, risk management and compliance solutions to target the growth opportunity in the financial services industry.

Critical Accounting Policies and Estimates

There have been no significant changes to our critical accounting policies as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2022, except with respect to our goodwill impairment assessment. As discussed in Note 2, the Company performed a quantitative goodwill impairment assessment of the Worldpay Merchant Solutions reporting unit, now reported as assets held for sale, as of June 30, 2023, and as of September 30, 2023. To estimate the fair value of the reporting unit, we used a market approach based on the price at which the Company has agreed to sell a majority interest in the Worldpay Merchant Solutions business. The estimated fair value included estimated selling price adjustments and fair value of contingent

consideration based on the terms and conditions of the definitive agreement related to the sale. A 10% increase or decrease in the estimated net purchase price adjustments and fair value of contingent consideration would not have a material impact to the impairment charge.

Consolidated Results of Operations - Comparisons of three- and nine month periods ended September 30, 2023 and 2022

			Three months ended September 30,																								Nine months ended September 30,
															$						%																		$						%
			2023						2022						Change						Change						2023						2022						Change						Change
			(In millions)																								(In millions)
Revenue			$	2,489					$	2,415					$	74					3		%				$	7,311					$	7,194					$	117					2		%
Cost of revenue			(1,523)						(1,534)						11						(1)						(4,610)						(4,646)						36						(1)
Gross profit			966						881						85						10						2,701						2,548						153						6
Gross profit margin			39		%				36		%																37		%				35		%
Selling, general and administrative expenses			(484)						(480)						(4)						1						(1,557)						(1,623)						66						(4)
Asset impairments			(7)						(17)						10						NM						(8)						(86)						78						NM
Operating income			$	475					$	384					91						24						$	1,136					$	839					297						35
Operating margin			19		%				16		%																16		%				12		%

NM = Not meaningful

Revenue

Revenue for the three months ended September 30, 2023, increased primarily due to strong recurring revenue growth in the Banking and Capital Markets segments. The recurring revenue growth in the Banking segment was aided by revenue growth from servicing federally funded pandemic relief programs.

Revenue for the nine months ended September 30, 2023, increased primarily due to strong recurring revenue growth in the Banking and Capital Markets segments. The recurring revenue growth in the Banking segment was aided by revenue growth from servicing federally funded pandemic relief programs. See "Segment Results of Operations" below for more detailed explanation.

Cost of Revenue, Gross Profit and Gross Profit Margin

Cost of revenue for the three and nine months ended September 30, 2023, decreased due to lower intangible asset amortization resulting primarily from using accelerated amortization methods which apply a declining rate over time, contributing to higher gross profit and gross profit margin.

Selling**,** General and Administrative Expenses

Selling, general and administrative expenses for the three months ended September 30, 2023, were materially unchanged between the two periods. Selling, general and administrative expenses for the nine months ended September 30, 2023, decreased primarily due to lower acquisition, integration and other costs partially offset by inflation, which increased corporate expenses as compared to the prior year period.

Asset Impairments

The three and nine months ended September 30, 2023, included impairments primarily related to the termination of certain internally developed software projects. For the three months ended September 30, 2022, the Company recorded impairments related primarily to certain software rendered obsolete by the Company's Platform modernization initiatives. For the nine months ended September 30, 2022, the Company also recorded impairments related primarily to real estate-related assets as a result of office space reductions and to a non-strategic business.

Operating Income and Operating Margin

The change in operating income and operating margin for the three and nine months ended September 30, 2023, resulted from the revenue and cost variances noted above.

Total Other Income (Expense), Net

			Three months ended September 30,																								Nine months ended September 30,
															$						%																		$						%
			2023						2022						Change						Change						2023						2022						Change						Change
Other income (expense):			(In millions)																								(In millions)
Interest expense, net			$	(162)					$	(78)					$	(84)					NM						$	(464)					$	(169)					$	(295)					NM
Other income (expense), net			22						18						4						NM						(91)						53						(144)						NM
Total other income (expense), net			$	(140)					$	(60)					(80)						NM						$	(555)					$	(116)					(439)						NM

NM = Not meaningful

The increase in interest expense, net during the three and nine months ended September 30, 2023, was primarily due to higher interest rates on our debt throughout the three and nine months ended September 30, 2023, offset in part by increased interest income.

Other income (expense), net also includes other income and expense items outside of the Company's operating activities, including fair value adjustments on certain non-operating assets and liabilities and foreign currency transaction remeasurement gains and losses. Other income (expense), net includes net gains (losses) on equity security investments without readily determinable fair values of $(10) million and $0 million for the three months and $(44) million and $47 million for the nine months ended September 30, 2023 and 2022, respectively. Net gains (losses) on equity securities investments includes $32 million of impairment for the nine months ended September 30, 2023, on an equity security investment which the Company agreed to sell for less than its carrying value**.** See Note 5 to the consolidated financial statements.

Provision (Benefit) for Income Taxes

			Three months ended September 30,																								Nine months ended September 30,
															$						%																		$						%
			2023						2022						Change						Change						2023						2022						Change						Change
			(In millions)																								(In millions)
Provision (benefit) for income taxes			$	74					$	102					$	(28)					NM						$	139					$	218					$	(79)					NM
Effective tax rate			22		%				31		%																24		%				30		%

NM = Not meaningful

The decrease in the effective tax rate for the three and nine months ended September 30, 2023, was primarily driven by a more favorable foreign tax rate differential.

Discontinued Operations

			Three months ended September 30,																								Nine months ended September 30,
															$						%																		$						%
			2023						2022						Change						Change						2023						2022						Change						Change
			(In millions)																								(In millions)
Revenue			$	1,201					$	1,189					$	12					1		%				$	3,636					$	3,620					$	16					—		%
Earnings (loss) from discontinued operations related to major classes of pretax earning (loss)			$	458					$	20					438						NM						$	(6,123)					$	152					(6,275)						NM
Pretax gain (loss) on the disposal of discontinued operations			$	(1,549)					$	—					(1,549)						NM						$	(1,549)					$	—					(1,549)						NM
Earnings (loss) from discontinued operations, net of tax			$	(709)					$	31					(740)						NM						$	(7,345)					$	147					(7,492)						NM

Revenue from discontinued operations for the three and nine months ended September 30, 2023, was essentially unchanged from the prior year.

For the three months ended September 30, 2023, the earnings from discontinued operations related to major classes of pretax earning (loss) increased primarily as a result of stopping amortization of long-lived assets held for sale beginning on July 5, 2023.

For the three months ended September 30, 2023, earnings (loss) from discontinued operations, net of tax decreased due to a $1.5 billion valuation allowance recorded to reduce the Worldpay Merchant Solutions disposal group's carrying value down to fair value less cost to sell, primarily as a result of the exclusion from the disposal group's carrying value of certain deferred tax liabilities that will continue to be held by FIS after the disposal, which caused the carrying value to exceed the estimated fair value of the disposal group.

For the nine months ended September 30, 2023, earnings (loss) from discontinued operations, net of tax decreased primarily due to the goodwill impairment recorded in the second quarter of 2023 and the valuation allowance recorded in the third quarter of 2023, as discussed above.

Segment Results of Operations - Comparisons of three- and nine- month periods ended September 30, 2023 and 2022

As of September 30, 2023, FIS reports its financial performance based on the following segments: Banking Solutions, Capital Market Solutions, and Corporate and Other.

Adjusted EBITDA is defined as net earnings (loss) before net interest expense, net other income (expense), income tax provision (benefit), depreciation and amortization, and excludes certain costs and other transactions that management deems non-operational in nature or that otherwise improve the comparability of operating results across reporting periods by their exclusion. This measure is reported to the chief operating decision maker for purposes of making decisions about allocating resources to the segments and assessing their performance. For this reason, Adjusted EBITDA, as it relates to our segments, is presented in conformity with FASB ASC Topic 280, Segment Reporting. The items affecting the segment profit measure generally include purchase price amortization of acquired intangible assets as well as acquisition, integration and certain other costs and asset impairments. These costs and adjustments are recorded in the Corporate and Other segment for the periods discussed below. Adjusted EBITDA for the respective segments excludes the foregoing costs and adjustments. Financial information, including details of Adjusted EBITDA, for each of our segments is set forth in Note 11 to the consolidated financial statements.

Banking Solutions

			Three months ended September 30,																								Nine months ended September 30,
															$						%																		$						%
			2023						2022						Change						Change						2023						2022						Change						Change
			(In millions)																								(In millions)
Revenue			$	1,756					$	1,703					$	53					3		%				$	5,144					$	5,039					$	105					2		%
Adjusted EBITDA			$	783					$	738					45						6						$	2,183					$	2,192					$	(9)					—
Adjusted EBITDA margin			44.6		%				43.4		%																42.4		%				43.5		%
Adjusted EBITDA margin basis points change			120																								(110)

Three months ended September 30:

Revenue in our Banking segment increased 3% year over year for the three months ended September 30, 2023. Recurring revenue contributed 6% to total segment growth, including 3% of total segment growth associated with revenue from servicing federally funded pandemic relief programs. Non-recurring revenue contributed (3%) to growth due to a reduction in license and professional services revenue versus the prior year.

Adjusted EBITDA and adjusted EBITDA margin increased year over year primarily due to Future Forward costs savings.

Nine months ended September 30:

Revenue in our Banking segment increased 2% year over year for the nine months ended September 30, 2023. Recurring revenue contributed 4% to growth, as payments volumes increased year over year, including in our commercial services and value-added processing businesses and volumes associated with revenue from servicing federally funded pandemic relief programs. Non-recurring revenue contributed (2%) to growth due to a reduction in license revenue and termination fees versus the prior year.

Adjusted EBITDA and adjusted EBITDA margin declined year over year due to revenue mix, partially offset by Future Forward cost savings.

Capital Market Solutions

			Three months ended September 30,																								Nine months ended September 30,
															$						%																		$						%
			2023						2022						Change						Change						2023						2022						Change						Change
			(In millions)																								(In millions)
Revenue			$	677					$	633					$	44					7		%				$	2,011					$	1,892					$	119					6		%
Adjusted EBITDA			$	332					$	315					17						5						$	988					$	926					62						7
Adjusted EBITDA margin			49.0		%				49.8		%																49.1		%				49.0		%
Adjusted EBITDA margin basis points change			(80)																								10

Three months ended September 30:

Revenue in our Capital Markets segment increased 7% year over year for the three months ended September 30, 2023. Recurring revenue contributed 6% to growth due to strong new sales momentum and continued movement to a SaaS-based recurring revenue model. Total revenue was impacted by favorable foreign currency movements, which contributed 1% to growth, due to a weaker U.S. Dollar versus the British Pound Sterling as compared to the prior year period.

Adjusted EBITDA increased year over year due to the revenue impacts noted above. Adjusted EBITDA margin declined due to the timing of operating expenses.

Nine months ended September 30:

Revenue in our Capital Markets segment increased 6% year over year for the nine months ended September 30, 2023. Recurring revenue contributed 7% to growth due to strong new sales momentum and continued movement to a SaaS-based

recurring revenue model. Total revenue was impacted by unfavorable foreign currency movements, which contributed (1%) to growth, due to a stronger U.S. Dollar versus the British Pound Sterling as compared to the prior-year period.

Adjusted EBITDA and adjusted EBITDA margin increased year over year due to strong contribution margins from revenue growth.

Corporate and Other

			Three months ended September 30,																								Nine months ended September 30,
															$						%																		$						%
			2023						2022						Change						Change						2023						2022						Change						Change
			(In millions)																								(In millions)
Revenue			$	56					$	79					$	(23)					(29)		%				$	156					$	263					$	(107)					(41)		%
Adjusted EBITDA			$	(45)					$	(31)					(14)						45						$	(256)					$	(203)					(53)						26

The Corporate and Other segment results consist of selling, general and administrative expenses and depreciation and intangible asset amortization not otherwise allocated to the reportable segments. Corporate and Other also includes operations from certain non-strategic businesses.

Three months ended September 30:

Revenue in our Corporate and Other segment decreased 29% year over year for the three months ended September 30, 2023, due to the divestiture of a non-strategic business in 2022.

Adjusted EBITDA decreased due to lower revenue and inflation, which increased corporate expenses as compared to the prior year period.

Nine months ended September 30:

Revenue in our Corporate and Other segment decreased 41% year over year for the nine months ended September 30, 2023, due to the divestiture of non-strategic businesses in 2022.

Adjusted EBITDA decreased due to lower revenue and inflation, which increased corporate expenses as compared to the prior year period.

Liquidity and Capital Resources

Cash Requirements

Our ongoing cash requirements include operating expenses, income taxes, tax receivable obligations, mandatory debt service payments, capital expenditures, share repurchases, stockholder dividends, regulatory requirements, working capital and timing differences in settlement-related assets and liabilities and may include discretionary debt repayments and business acquisitions. Our principal sources of funds are cash generated by operations and borrowings, including the capacity under our Revolving Credit Facility, the U.S. commercial paper program and the Euro-commercial paper program discussed in Note 7 to the consolidated financial statements.

As of September 30, 2023, the Company had $3,216 million of available liquidity, including $466 million of cash and cash equivalents, exclusive of discontinued operations, and $2,750 million of capacity available under its Revolving Credit Facility and Incremental Credit Facility. Approximately $54 million of cash and cash equivalents is held by our foreign entities, including amounts related to regulatory requirements. The majority of our domestic cash and cash equivalents relates to settlement payables and net deposits-in-transit, which are typically settled within a few business days. Debt outstanding totaled $18.7 billion, with an effective weighted average interest rate of 3.5%. As of September 30, 2023, our assets held for sale included $1,356 million of cash and cash equivalents which the Company will not be able to freely access following the separation of the Worldpay Merchant Solutions business. Such amount of Cash and cash equivalents in assets held for sale is inclusive of $1,041 million in cash and cash equivalents held by foreign entities, including amounts related to regulatory requirements.

Although we continue to evaluate the optimal capital structure for our business following the completion of the pending sale of a majority interest in the Worldpay Merchant Solutions business, we intend to maintain investment grade debt ratings for FIS. The pending Worldpay transaction will also result in significant one-time costs, a portion of which we will be required to fund.

We believe that our current level of cash and cash equivalents plus cash flows from operations will be sufficient to fund our operating cash requirements, capital expenditures and mandatory debt service payments for the next 12 months and the foreseeable future.

A regular quarterly dividend of $0.52 per common share is payable on December 22, 2023, to shareholders of record as of the close of business on December 8, 2023. We currently expect to continue to pay quarterly dividends at a target payout ratio consistent with our capital allocation strategy (without regard to net earnings (loss) attributable to the Worldpay Merchant Solutions business non-controlling interest that will be retained post-separation). However, the amount, declaration and payment of future dividends is at the discretion of the Board of Directors and depends on, among other things, our investment opportunities (including potential mergers and acquisitions), results of operations, financial condition, cash requirements, future prospects, and other factors, including legal and contractual restrictions, that may be considered relevant by our Board of Directors. Additionally, the payment of cash dividends may be limited by covenants in certain debt agreements.

In January 2021, our Board of Directors approved a share repurchase program under which it authorized the Company to repurchase up to 100 million shares of our common stock at management's discretion from time to time on the open market or in privately negotiated transactions and through Rule 10b5-1 plans. The share repurchase program has no expiration date and may be suspended for periods, amended or discontinued at any time. Approximately 64 million shares remained available for repurchase as of September 30, 2023. We plan to continue to prioritize debt reduction and to resume repurchasing shares under the current share repurchase authorization beginning in the fourth quarter of 2023. We now intend to repurchase approximately $500 million shares in the fourth quarter of 2023 as part of a broader goal to repurchase at least $3.5 billion of our shares outstanding by year end 2024.

Cash Flows from Operations

Cash flows from operations, inclusive of discontinued operations, were $2,810 million and $2,798 million for the nine-month periods ended September 30, 2023, and 2022, respectively (see Note 2 for cash provided by operating activities from discontinued operations). Our net cash provided by operating activities consists primarily of net earnings, adjusted to add back depreciation and amortization and other non-cash items. Cash flows from operations were unchanged in the nine-month period ended September 30, 2023, primarily due to a decrease in net earnings after adjusting to add back depreciation and other non-cash items and settlement timing, offset by working capital.

Capital Expenditures and Other Investing Activities

Our principal capital expenditures are for software (purchased and internally developed) and additions to property and equipment. Inclusive of discontinued operations, we invested approximately $844 million and $1,083 million in capital expenditures (excluding other financing obligations for certain hardware and software) during the nine-month periods ended September 30, 2023 and 2022, respectively (see Note 2 for capital expenditures from discontinued operations). We expect to continue investing in property and equipment, purchased software and internally developed software to support our business.

During the nine-month periods ended September 30, 2023 and 2022, we (paid) received approximately $(20) million and $684 million of net cash reflected as investing activities due to the settlement of existing cross-currency interest rate swaps. See Note 8 to the consolidated financial statements. In January 2023, the founders of Virtus exercised their put option, and as a result, FIS paid the $173 million redemption value, recorded as a financing activity in the consolidated statement of cash flows.

Financing

For more information regarding the Company's debt and financing activity, see "Risk Factors—Risks Related to Our Indebtedness" in Item 1A of our Annual Report on Form 10-K filed on February 27, 2023, and "Quantitative and Qualitative Disclosures About Market Risk—Interest Rate Risk" in Item 3 as well as Notes 7 and 8 to the consolidated financial statements.

Contractual Obligations

There were no material changes in our contractual obligations through the nine months ended September 30, 2023, in comparison to the table included in our Annual Report on Form 10-K for the year ended December 31, 2022, except as disclosed in Note 7 to the consolidated financial statements.

Recent Accounting Pronouncements

No new accounting pronouncement issued or effective during the fiscal year had or is expected to have a material impact on our consolidated financial statements or disclosures.