Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

This quarterly report contains “forward-looking statements” intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include those that express a plan, belief, expectation, estimation, anticipation, intent, contingency, future development, outlook, or similar expression, and can generally be identified as forward-looking because they include words such as “believes,” “anticipates,” “expects,” “could,” “should,” “confident,” “likely,” “plan,” or words of similar meaning. Statements that describe our future plans, objectives or goals are also forward-looking statements.

The forward-looking statements in this report involve significant risks and uncertainties, and a number of factors, both foreseen and unforeseen, could cause actual results to differ materially from our current expectations. The factors that may affect our results include, among others, the following: our ability to compete effectively against new and existing competitors and to continue to introduce competitive new products and services on a timely, cost-effective basis; changes in customer demand for our products and services; the ability of our technology to keep pace with a rapidly evolving marketplace; the success of our merchant alliances, some of which we do not control; the impact of a security breach or operational failure in our business, including disruptions caused by other participants in the global financial system; losses due to chargebacks, refunds or returns as a result of fraud or the failure of our vendors and merchants to satisfy their obligations; changes in local, regional, national and international economic or political conditions, including those resulting from heightened inflation, rising interest rates, a recession, bank failures, or intensified international hostilities, and the impact they may have on us and our employees, clients, vendors, supply chain, operations and sales; the effect of proposed and enacted legislative and regulatory actions affecting us or the financial services industry as a whole; our ability to comply with government regulations and applicable card association and network rules; the protection and validity of intellectual property rights; the outcome of pending and future litigation and governmental proceedings; our ability to successfully identify, complete and integrate acquisitions, and to realize the anticipated benefits associated with the same; the impact of our strategic initiatives; our ability to attract and retain key personnel; volatility and disruptions in financial markets that may impact our ability to access preferred sources of financing and the terms on which we are able to obtain financing or increase our costs of borrowing; adverse impacts from currency exchange rates or currency controls; changes in corporate tax and interest rates; and other factors identified in "Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023 and in other documents that we file with the Securities and Exchange Commission, which are available at http://www.sec.gov. You should consider these factors carefully in evaluating forward-looking statements and are cautioned not to place undue reliance on such statements, which speak only as of the date of this report. We undertake no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this report.

Management’s discussion and analysis of financial condition and results of operations is provided as a supplement to our unaudited consolidated financial statements and accompanying notes to help provide an understanding of our financial condition, the changes in our financial condition and our results of operations. Our discussion is organized as follows:

• Overview. This section contains background information on our company and the products and services that we provide, acquisitions and dispositions, and the trends affecting our industry in order to provide context for management’s discussion and analysis of our financial condition and results of operations.

• Changes in critical accounting policies and estimates. This section contains a discussion of changes since our Annual Report on Form 10-K for the year ended December 31, 2023 in the accounting policies that we believe are important to our financial condition and results of operations and that require judgment and estimates on the part of management in their application.

• Results of operations. This section contains an analysis of our results of operations presented in the accompanying unaudited consolidated statements of income by comparing the results for the three and nine months ended September 30, 2024 to the comparable periods in 2023.

• Liquidity and capital resources. This section provides an analysis of our cash flows and a discussion of our outstanding debt at September 30, 2024.

Overview

Company Background

We are a leading global provider of payments and financial services technology solutions. We serve clients around the globe, including merchants, banks, credit unions, other financial institutions, corporate and public sector clients. We help clients

achieve best-in-class results through a commitment to innovation and excellence in areas including account processing and digital banking solutions; card issuer processing and network services; payments; e-commerce; merchant acquiring and processing; and the Clover® cloud-based point-of-sale (“POS”) and business management platform. Most of the products and services we provide are necessary for our clients to operate their businesses and are therefore non-discretionary in nature. We serve our global client base by working among our geographic teams across various regions, including the United States of America (“U.S.”) and Canada; Europe, Middle East and Africa; Latin America; and Asia Pacific.

We aspire to move money and information in a way that moves the world. Our purpose is to deliver superior value for our clients through leading technology, targeted innovation and excellence in everything we do. We are focused on driving growth and creating value by assembling a high-performing and diverse team, integrating our solutions, delivering operational excellence, allocating capital in a disciplined manner, including share repurchase and merger and acquisition activity, and delivering breakthrough innovation. Our long-term focus is to meet our financial commitments; continue to build high-quality revenue; deepen client relationships with an emphasis on digital solutions and value-added services; deliver innovation and integration enabling differentiated value for our clients; and generate integration value, including cost and revenue synergies from acquisitions.

Effective in the first quarter of 2024, we realigned our reportable segments to correspond with changes in our business designed to further enhance operational performance in the delivery of our integrated portfolio of products and solutions to our financial institution clients (the “Segment Realignment”). Our new reportable segments are the Merchant Solutions (“Merchant”) segment and the Financial Solutions (“Financial”) segment. Segment results for the three and nine months ended September 30, 2023 have been recast to reflect the Segment Realignment.

The businesses in the Merchant segment provide commerce-enabling products and services to companies of all sizes around the world. These products and services include merchant acquiring and digital commerce services; mobile payment services; security and fraud protection solutions; stored-value solutions; and pay-by-bank solutions. The businesses within the Merchant segment consist of the following:

*•*Small Business – provides products and services to small businesses and independent software vendors, including Clover®, our point-of-sale integrated commerce operating system for small business clients

*•*Enterprise – provides products and services to large businesses, including CaratSM, our integrated commerce operating system for enterprise clients

*•*Processing – provides products and services to financial institutions, joint ventures, and other third party resellers which have direct relationships with merchants

We distribute the products and services in the Merchant segment businesses through a variety of channels, including direct sales teams, strategic partnerships with agent sales forces, independent software vendors (“ISV”), financial institutions and other strategic partners in the form of joint venture alliances, revenue sharing alliances and referral agreements.

The businesses in the Financial segment provide products and services to financial institution, corporate and public sector clients across the world, enabling the processing of customer loan and deposit accounts, digital payments and card transactions. The businesses within the Financial segment consist of the following:

*•*Digital Payments – provides debit card processing services; debit network services; security and fraud protection products; bill payment; person-to-person payments; and account-to-account transfers

*•*Issuing – provides credit card processing services; prepaid card processing services; card production services; print services; government payment processing; and student loan processing

*•*Banking – provides customer loan and deposit account processing; digital banking; financial and risk management; professional services and consulting; and check processing

Corporate and Other supports the reportable segments described above, and consists of amortization of acquisition-related intangible assets, unallocated corporate expenses and other activities that are not considered when we evaluate segment performance, such as gains or losses on sales of businesses, certain assets or investments; costs associated with acquisition and divestiture activity; certain services revenue associated with various dispositions; and postage reimbursements.

Acquisitions and Dispositions

We frequently review our businesses to ensure we have the necessary assets to execute our strategy. We expect to acquire businesses when we identify: a compelling strategic need, such as a product, service or technology that helps meet client demand; a way to achieve business scale that enables competition and operational efficiency; or similar considerations. We expect to divest businesses that are not in line with our market, product or financial strategies. The results of operations for the

following acquired and divested businesses are included in our consolidated results from the respective dates of acquisition and through the respective dates of disposition.

Acquisitions of Businesses

On October 9, 2023, we acquired Skytef Solucões em Captura de Transações Ltda (“Skytef”), a distributor for ISV partners and merchants of our Electronic Funds Transfer payments software. Skytef is included within the Merchant segment and expands our distribution network and POS applications. On November 1, 2023, we acquired Sled S.A. (“Sled”), a provider of instant payment solutions. Sled is included within the Merchant segment and expands our direct payment service capabilities. We acquired these businesses in Latin America for an aggregate purchase price, including hold-backs, of $17 million.

Dispositions of Businesses

On July 25, 2023, we sold our financial reconciliation business, which was reported within the Financial segment, for cash proceeds of $232 million, subject to final net working capital adjustments. We recognized a pre-tax gain of $177 million on the sale during the three months ended September 30, 2023.

Other Transactions

In the third quarter of 2024, Wells Fargo Bank, National Association (“Wells Fargo”) provided us a notice of non-renewal for the Wells Fargo Merchant Services merchant alliance (“WFMS”), which is accounted for as an equity method investment. Upon expiration of the merchant alliance, effective April 1, 2025, we expect to receive a cash payment or assets equal to the fair value of our 40% ownership interest of WFMS, as determined in accordance with an agreed upon contractual valuation and separation process. We recorded a $570 million non-cash impairment as a result of an other-than-temporary decline in the carrying value of our equity method investment in WFMS during the three months ended September 30, 2024. The impairment was based on our estimate of the fair value of WFMS and is subject to further adjustments upon completion of the final valuation process. In connection with the expiration of WFMS, we entered into a multi-year agreement with Wells Fargo to provide processing for current and future merchant clients as well as other services to Wells Fargo’s merchant business.

On September 25, 2023, we acquired the remaining 49% ownership interest in European Merchant Services B.V., a Netherlands-based merchant acceptance business, for $56 million. We previously held a majority controlling financial interest in this subsidiary, which continues to be consolidated and reported within the Merchant segment.

Industry Trends

The global payments landscape continues to evolve, with rapidly advancing technologies and a steady expansion of digital payments, e-commerce and real-time payments infrastructure. Because of this growth, competition also continues to intensify. Business and consumer expectations continue to rise, with a focus on speed, convenience, choice and security. To meet these expectations, payments companies are focused on modernizing their technology, expanding the use of data and enhancing the customer experience.

Merchants

The rapid growth in and globalization of mobile and e-commerce, driven by consumers’ desire for simpler, more efficient shopping experiences, has created an opportunity for merchants to reach consumers nearly anywhere, through any device, which often requires a merchant acquiring provider to enable and optimize the acceptance of payments. Merchants are demanding simpler, integrated and flexible systems to enable them to serve customers and help manage cash flow and everyday business operations. When combined with the ever-increasing ways a consumer can pay for goods and services, merchants have sought modern end-to-end solutions throughout their growth lifecycle to streamline the complexity. Furthermore, merchants can now search, discover, compare, purchase and even install a new system through direct, digital-only experiences. This direct, digital-only channel is a source of new merchant acquisition opportunities, especially with respect to smaller merchants.

Additionally, there are numerous software-as-a-service solution providers in the industry, many of which have chosen to integrate merchant acquiring into their software as a way to generate revenue from existing client relationships. Such providers are independent software vendors, typically referred to as ISVs, and we believe there are numerous potential distribution partnership opportunities to cross-sell multiple value-added solutions available to us.

We believe that our merchant acquiring products and solutions create compelling value propositions for merchant clients of all sizes, from small and mid-sized businesses to medium-sized regional businesses to global enterprise merchants. The depth and breadth of our omnichannel solutions, and flexibility to serve clients across various channels and geographies, drives higher product attach rates with new and existing clients across all verticals. Furthermore, we believe that our strength in distribution,

our progress growing software and services, and our value-based pricing as we continue to invest in our operating systems, gives us a solid foundation for growth.

Financial Institutions

Financial services providers regularly introduce and implement new payment, deposit, risk management, lending and investment products, and the distinctions among the products and services traditionally offered by different types of financial institutions continue to narrow as they seek to serve the same customers. At the same time, the evolving global regulatory and cybersecurity landscape has continued to create a challenging operating environment for financial institutions. These conditions are driving heightened interest in solutions that help financial institutions win and retain customers, generate revenue, comply with regulations and enhance operating efficiency. In addition, the focus on the customer experience, including through mobile and online engagement, by both financial institutions and their customers, as well as the growing volume and types of payment transactions in the marketplace, continues to elevate the data and transaction processing needs of financial institutions.

Financial institutions must be able to serve their customers with tailored solutions, delivered how and when those customers want. In addition, financial institutions are striving for this single, integrated view of a customer’s activity. This requires financial institutions to not only process customer transactions, but to integrate financial institutions’ products and services to give customers easy access to integrated solutions. We believe that the integration of our products and services creates a compelling value proposition for our clients by providing, among other things, new sources of revenue and opportunities to reduce their costs. We have invested in integrating our platforms and value-added solutions to make it easy for a client to buy across our full product suite.

We expect that financial institutions will continue to invest significant capital to process transactions, manage information, maintain regulatory compliance and offer innovative new services to their customers in this rapidly evolving and competitive environmental shift from traditional to digital banking. We believe that economies of scale in developing and maintaining the infrastructure, technology, products, services and networks necessary to be competitive in such an environment are essential to justify these investments, and we anticipate that demand for products that facilitate customer interaction with financial institutions, including a unified, seamless customer experience across mobile and online channels, will continue to increase, which we expect to create revenue opportunities for us.

Our focus on long-term client relationships and recurring, transaction-oriented products and services has reduced the impact that consolidation in the financial services industry has had on us. Rather than reducing the overall market, these consolidations transfer accounts among financial institutions. If a client loss occurs due to merger or acquisition, we typically receive a contract termination fee based on the size of the client and how early in the contract term the contract is terminated. We believe that our sizable and diverse client base, combined with our value-added software and services-led model, and our position as a leading provider of non-discretionary, recurring revenue-based products and services, gives us a solid foundation for growth.

Recent Market Conditions

Global macroeconomic conditions, including changing interest rates, inflation, disruptions in the global supply chain, changes in consumer spending, the effects of international hostilities, political conditions, and regulations restricting trade or impacting our ability to offer products or services, could have a material adverse effect on our business, results of operations and financial condition. Personal consumption and consumer savings growth in the U.S. may also negatively impact our business and financial results. We actively monitor and manage our business in response to these unpredictable geopolitical and market conditions, as they may adversely impact our operations and financial results.

In addition, our operating results in certain foreign countries in which we operate may be adversely impacted by fluctuations in exchange rates for currencies other than the U.S. dollar, including the Euro, British Pound Sterling and Argentine Peso. The strengthening of the U.S. dollar against certain foreign currencies in countries in which we operate would negatively impact our revenue and earnings. We also have exposure to risks related to currency devaluation in certain countries, which may negatively impact our international operating results if there is a prolonged devaluation of local currencies relative to the U.S. dollar or if the economic conditions in these countries decline. While the majority of our revenue is earned domestically, we actively monitor the foreign exchange rate environment and may enter into derivative instruments and utilize other non-derivative hedging instruments with creditworthy institutions in an effort to manage these risks.

The operations of our Argentina subsidiary are experiencing higher interest rates and inflation as compared to historical averages. The anticipated benefits of higher transitory revenue from above-average interest and inflation may be offset in whole or in part by, or may be less than, foreign currency exchange losses related to a significant devaluation of the Argentine Peso.

Changes in Critical Accounting Policies and Estimates

Our unaudited consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the U.S., which require management to make estimates, judgments and assumptions that affect the reported amount of assets, liabilities, revenue and expenses. In our Annual Report on Form 10-K for the year ended December 31, 2023, we identified our critical accounting policies and estimates. We continually evaluate the accounting policies and estimates that we use to prepare our consolidated financial statements, including for recently adopted accounting pronouncements, and base our estimates on historical experience and assumptions that we believe are reasonable in light of current circumstances. Actual amounts and results could differ materially from these estimates. For example, we estimate the fair values of identifiable assets acquired and liabilities assumed in connection with acquisitions of businesses and may record purchase accounting adjustments during the measurement period, which may be up to one year from the acquisition date. Additionally, we review the carrying value of goodwill for impairment by comparing the estimated fair values of our reporting units to their carrying values. Determining the fair value of a reporting unit involves judgement and the use of significant estimates and assumptions, which include assumptions regarding the revenue growth rates and operating margins used to calculate estimated future cash flows, risk-adjusted discount rates, and future economic and market conditions.

In addition to the critical accounting policies and estimates included as Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission on February 22, 2024, the following additional critical accounting policy and estimate has become material to us since the filing of our Form 10-K.

Equity Method Investments

We review our investments in various affiliates that are accounted for as equity method investments for indications of an other- than-temporary decline in value whenever events or changes in circumstances may indicate that the carrying amount of the investment may not be recoverable. A series of operating losses of an investee or other factors, such as a shift in strategic initiatives or a significant change in a merchant alliance business relationship, may indicate that a decrease in value of the investment has occurred that is other-than-temporary. A decline in value of an equity method investment determined to be other-than-temporary is recorded as a current-period impairment charge. Measurement of an impairment loss is based upon a comparison of the carrying amount of the investment to its estimated fair value.

Determining the fair value of an equity method investment involves judgment and the use of significant estimates and assumptions, which include assumptions regarding customer growth and attrition rates and operating margins used to calculate estimated future cash flows; risk-adjusted discount rates; and other future economic and market conditions. During the third quarter of 2024, we determined that one of our equity method investments experienced an other-than-temporary decline in value and therefore recorded a pretax non-cash impairment charge of $570 million. Additional information regarding our equity method investments is included in Note 6 to the consolidated financial statements.

Results of Operations

The following table presents certain amounts included in our consolidated statements of income, the relative percentage that those amounts represent to revenue and the change in those amounts from year to year. This information should be read together with the unaudited consolidated financial statements and accompanying notes. The unaudited financial results presented below have been affected by acquisitions, dispositions, non-cash impairment charges, and foreign currency fluctuations. Segment results for the three and nine months ended September 30, 2023 have been recast to reflect the Segment Realignment.

			Three Months Ended September 30,
			2024						2023						Percentage of Revenue (1)												Increase (Decrease)
(In millions)						2024						2023						$						%
Revenue:
Processing and services			$	4,237					$	4,008					81.2		%				82.2		%				$	229					6		%
Product			978						865						18.8		%				17.8		%				113						13		%
Total revenue			5,215						4,873						100.0		%				100.0		%				342						7		%
Expenses:
Cost of processing and services			1,346						1,311						31.8		%				32.7		%				35						3		%
Cost of product			661						583						67.6		%				67.4		%				78						13		%
Sub-total			2,007						1,894						38.5		%				38.9		%				113						6		%
Selling, general and administrative			1,606						1,652						30.8		%				33.9		%				(46)						(3)		%
Net gain on sale of businesses and other assets			—						(176)						—		%				(3.6)		%				176						n/m
Total expenses			3,613						3,370						69.3		%				69.2		%				243						7		%
Operating income			1,602						1,503						30.7		%				30.8		%				99						7		%
Interest expense, net			(326)						(258)						(6.3)		%				(5.3)		%				68						26		%
Other expense, net			(5)						(35)						(0.1)		%				(0.7)		%				(30)						(86)		%
Income before income taxes and loss from investments in unconsolidated affiliates			1,271						1,210						24.4		%				24.8		%				61						5		%
Income tax provision			(74)						(239)						(1.4)		%				(4.9)		%				(165)						(69)		%
Loss from investments in unconsolidated affiliates			(626)						(2)						(12.0)		%				—		%				624						n/m
Net income			571						969						10.9		%				19.9		%				(398)						(41)		%
Less: net income attributable to noncontrolling interests and redeemable noncontrolling interest			7						17						0.1		%				0.3		%				(10)						(59)		%
Net income attributable to Fiserv, Inc.			$	564					$	952					10.8		%				19.5		%				$	(388)					(41)		%

(1)Percentage of revenue is calculated as the relevant revenue, expense or income amount divided by total revenue, except for cost of processing and services and cost of product amounts, which are divided by the related component of revenue.

			Nine Months Ended September 30,
			2024						2023						Percentage of Revenue (1)												Increase (Decrease)
(In millions)			2024						2023						$						%
Revenue:
Processing and services			$	12,377					$	11,605					81.4		%				81.9		%				$	772					7		%
Product			2,828						2,571						18.6		%				18.1		%				257						10		%
Total revenue			15,205						14,176						100.0		%				100.0		%				1,029						7		%
Expenses:
Cost of processing and services			4,043						4,067						32.7		%				35.0		%				(24)						(1)		%
Cost of product			1,951						1,761						69.0		%				68.5		%				190						11		%
Sub-total			5,994						5,828						39.4		%				41.1		%				166						3		%
Selling, general and administrative			5,000						4,952						32.9		%				34.9		%				48						1		%
Net gain on sale of businesses and other assets			—						(172)						—		%				(1.2)		%				172						n/m
Total expenses			10,994						10,608						72.3		%				74.8		%				386						4		%
Operating income			4,211						3,568						27.7		%				25.2		%				643						18		%
Interest expense, net			(872)						(692)						(5.7)		%				(4.9)		%				180						26		%
Other expense, net			(17)						(81)						(0.1)		%				(0.6)		%				(64)						(79)		%
Income before income taxes and loss from investments in unconsolidated affiliates			3,322						2,795						21.8		%				19.7		%				527						19		%
Income tax provision			(448)						(544)						(2.9)		%				(3.8)		%				(96)						(18)		%
Loss from investments in unconsolidated affiliates			(642)						(11)						(4.2)		%				(0.1)		%				631						n/m
Net income			2,232						2,240						14.7		%				15.8		%				(8)						—		%
Less: net income attributable to noncontrolling interests and redeemable noncontrolling interest			39						42						0.3		%				0.3		%				(3)						(7)		%
Net income attributable to Fiserv, Inc.			$	2,193					$	2,198					14.4		%				15.5		%				$	(5)					—		%

(1)Percentage of revenue is calculated as the relevant revenue, expense or income amount divided by total revenue, except for cost of processing and services and cost of product amounts, which are divided by the related component of revenue.

			Three Months Ended September 30,
(In millions)			Merchant						Financial												Corporate and Other						Total
Total revenue:
2024			$	2,469					$	2,412											$	334					$	5,215
2023			2,259						2,302												312						4,873
Revenue growth			$	210					$	110											$	22					$	342
Revenue growth percentage			9		%				5		%																7		%
Operating income (loss):
2024			$	931					$	1,143											$	(472)					$	1,602
2023			786						1,079												(362)						1,503
Operating income growth			$	145					$	64											$	(110)					$	99
Operating income growth percentage			18		%				6		%																7		%
Operating margin:
2024			37.7		%				47.4		%																30.7		%
2023			34.8		%				46.9		%																30.8		%
Operating margin growth (1)			290		bps				50		bps																(10)		bps

(1)Represents the basis point growth in operating margin.

			Nine Months Ended September 30,
(In millions)			Merchant												Financial						Corporate and Other						Total
Total revenue:
2024			$	7,132																	$	7,076								$	997								$	15,205
2023			6,461																		6,770									945									14,176
Revenue growth			$	671																	$	306								$	52								$	1,029
Revenue growth percentage			10		%																5		%																7		%
Operating income (loss):
2024			$	2,582																	$	3,244								$	(1,615)								$	4,211
2023			2,123																		3,050									(1,605)									3,568
Operating income growth			$	459																	$	194								$	(10)								$	643
Operating income growth percentage			22		%																6		%																18		%
Operating margin:
2024			36.2		%																45.8		%																27.7		%
2023			32.9		%																45.1		%																25.2		%
Operating margin growth (1)			330		bps																70		bps																250		bps

(1)Represents the basis point growth in operating margin.

Operating margin percentages are calculated using actual, unrounded amounts.

Total Revenue

Total revenue increased $342 million, or 7%, in the third quarter of 2024 and increased $1,029 million, or 7%, in the first nine months of 2024 compared to 2023. The revenue increase was driven by higher processing revenue in both our Merchant and Financial segments, partially offset by a 8% and 9% decrease due to foreign currency exchange rate fluctuations in the third quarter and first nine months of 2024, respectively.

Revenue in our Merchant segment increased $210 million, or 9%, in the third quarter of 2024 and increased $671 million, or 10%, in the first nine months of 2024 compared to 2023. In the third quarter and first nine months of 2024, Small Business contributed 6% and 8% to Merchant segment revenue growth, respectively, driven by an increase in payment volume, partially offset by foreign currency exchange rate fluctuations. Small Business revenue growth also includes contributions from our Clover operating system and the expansion of our merchant relationships through value-added services. Additionally, in the third quarter and first nine months of 2024, Enterprise contributed 4% and 2%, respectively, primarily driven by transaction growth.

Revenue in our Financial segment increased $110 million, or 5%, in the third quarter of 2024 and increased $306 million, or 5%, in the first nine months of 2024 compared to 2023. In the third quarter and first nine months of 2024, Digital Payments contributed 2% and 3% to Financial segment revenue growth, respectively, driven by an increase in transaction volume, including growth in Zelle® transactions. Issuing contributed 1% to Financial segment growth in both the third quarter and first nine months of 2024, primarily driven by an increase in active accounts due to strong demand across various verticals, including government and healthcare. Banking also contributed 1% in both the third quarter and first nine months of 2024.

Revenue at Corporate and Other increased $22 million, or 7%, in the third quarter of 2024 and increased $52 million, or 6%, in the first nine months of 2024 compared to 2023, due to increased postage revenue.

Total Expenses

Total expenses increased $243 million, or 7%, in the third quarter of 2024 and $386 million, or 4%, in the first nine months of 2024 compared to 2023. Total expenses as a percentage of total revenue were relatively flat at 69.3% in the third quarter of 2024 and decreased 250 basis points to 72.3% in the first nine months of 2024 compared to 2023. Total expenses as a percentage of total revenue were favorably impacted by operating leverage across our various businesses, as well as a reduction in amortization of acquisition-related intangible assets of approximately 80 basis points and 110 basis points and a reduction in acquisition and integration related expenses of approximately 60 basis points and 40 basis points in the third quarter and first nine months of 2024, respectively. The third quarter and first nine months of 2023 included a $177 million pre-tax gain on the sale of our financial reconciliation business.

Cost of processing and services as a percentage of processing and services revenue decreased to 31.8% in the third quarter of 2024 compared to 32.7% in the third quarter of 2023 and decreased to 32.7% in the first nine months of 2024 compared to 35.0% in the first nine months of 2023. Cost of processing and services as a percentage of processing and services revenue was favorably impacted by strong operating leverage accompanying scalable revenue growth in the third quarter and first nine months of 2024.

Cost of product as a percentage of product revenue increased to 67.6% in the third quarter of 2024 compared to 67.4% in the third quarter of 2023 and increased to 69.0% in the first nine months of 2024 compared to 68.5% in the first nine months of 2023. The cost of product as a percentage of product revenue in the third quarter and first nine months of 2024 was impacted by revenue mix, including an increase in hardware revenue, in the third quarter of 2024 compared to 2023.

Selling, general and administrative expenses as a percentage of total revenue decreased to 30.8% in the third quarter of 2024 compared to 33.9% in the third quarter of 2023 and decreased to 32.9% in the first nine months of 2024 compared to 34.9% in the first nine months of 2023. Selling, general and administrative expenses as a percentage of total revenue was favorably impacted in both the third quarter and first nine months of 2024 by a reduction in amortization of acquisition-related intangible assets of approximately 80 basis points and a reduction in acquisition and integration related expenses of approximately 30 basis points, as well as expense management initiatives.

Operating Income and Operating Margin

Total operating income increased $99 million, or 7%, in the third quarter of 2024 and increased $643 million, or 18%, in the first nine months of 2024 compared to 2023. Total operating margin decreased 10 basis points to 30.7% in the third quarter of 2024 and increased 250 basis points to 27.7% in the first nine months of 2024 compared to 2023. Total operating income and total operating margin benefited from scalable revenue growth, along with a $42 million and $160 million reduction in amortization of acquisition-related intangible assets and a $30 million and $61 million reduction in acquisition and integration related expenses in the third quarter and first nine months of 2024, respectively. Total operating income and total operating margin in the third quarter and first nine months of 2023 was favorably impacted by a $177 million pre-tax gain from the sale of our financial reconciliation business.

Operating income in our Merchant segment increased $145 million, or 18%, in the third quarter of 2024 and increased $459 million, or 22%, in the first nine months of 2024 compared to 2023. Operating margin increased 290 basis points to 37.7% in the third quarter of 2024 and increased 330 basis points to 36.2% in the first nine months of 2024 compared to 2023. Operating income and operating margin growth in our Merchant segment was primarily due to operating leverage and productivity.

Operating income in our Financial segment increased $64 million, or 6%, in the third quarter of 2024 and increased $194 million, or 6%, in the first nine months of 2024 compared to 2023. Operating margin increased 50 basis points to 47.4% in the third quarter of 2024 and increased 70 basis points to 45.8% in the first nine months of 2024 compared to 2023. Operating income and operating margin growth in our Financial segment was primarily due to operating leverage and scalable revenue growth.

The operating loss in Corporate and Other increased $110 million in the third quarter of 2024 and increased $10 million in the first nine months of 2024 compared to 2023. The operating losses in the third quarter and first nine months of 2023 included a $177 million pre-tax gain on the sale of our financial reconciliation business. The operating losses in the third quarter and first nine months of 2024 were favorably impacted by a reduction of $42 million and $160 million, respectively, in amortization of acquisition-related intangible assets, as well as a reduction of $25 million and $45 million, respectively, in acquisition and integration related expenses.

Interest Expense, Net

Interest expense, net increased $68 million, or 26%, in the third quarter of 2024 compared to 2023 and increased $180 million, or 26%, in the first nine months of 2024 compared to 2023 due to higher outstanding borrowings, including as a result of our public offering and issuance of $2.0 billion and $1.75 billion of senior notes in March 2024 and August 2024, respectively, as well as increased variable rate borrowings with our settlement advance cash program in Latin America compared to the prior year periods.

Other Expense, Net

Other expense, net decreased $30 million in the third quarter of 2024 and decreased $64 million in the first nine months of 2024 compared to 2023. Other expense, net includes foreign currency transaction gains and losses, gains or losses from a sale or change in fair value of investments in certain equity securities, and amounts related to debt guarantee arrangements of certain joint ventures. Other expense, net in the third quarter and first nine months of 2024 included $2 million and $29 million,

respectively, related to gains on the sale and remeasurement of certain equity securities. Net foreign currency transaction losses decreased $11 million and $12 million in the third quarter and first nine months of 2024 compared to the third quarter and first nine months of 2023, respectively.

Income Tax Provision

The income tax provision as a percentage of income before income taxes and loss from investments in unconsolidated affiliates was 5.8% and 19.8% for the three months ended September 30, 2024 and 2023, respectively, and 13.5% and 19.5% for the nine months ended September 30, 2024 and 2023, respectively. The effective income tax rate as a percentage of income before income taxes and loss from investments in unconsolidated affiliates for the three and nine months ended September 30, 2024 included a deferred tax benefit of $142 million recorded within the income tax provision associated with a non-cash impairment charge of $570 million recorded within loss from investments in unconsolidated affiliates, resulting in the lower effective income tax rate.

Loss from Investments in Unconsolidated Affiliates

Our share of net loss from unconsolidated affiliates accounted for using the equity method is reported as loss from investments in unconsolidated affiliates, and the related tax (provision) benefit is reported within the income tax provision in the consolidated statements of income. Loss from investments in unconsolidated affiliates, including acquired intangible asset amortization from valuations in purchase accounting, was $(626) million and $(2) million in the third quarter of 2024 and 2023, respectively, and $(642) million and $(11) million in the first nine months of 2024 and 2023, respectively. The third quarter and first nine months of 2024 included a $570 million non-cash impairment related to the Wells Fargo Merchant Services merchant alliance.

Net Income Attributable to Noncontrolling Interests

Net income attributable to noncontrolling interests and redeemable noncontrolling interest relates to the minority partners’ share of the net income in our consolidated subsidiaries. Net income attributable to noncontrolling interests, including acquired intangible asset amortization from valuations in purchase accounting, was $7 million and $17 million in the third quarter of 2024 and 2023, respectively, and $39 million and $42 million in the first nine months of 2024 and 2023, respectively.

Net Income Per Share – Diluted

Net income attributable to Fiserv, Inc. per share-diluted was $0.98 and $1.56 in the third quarter of 2024 and 2023, respectively, and $3.74 and $3.54 in the first nine months of 2024 and 2023, respectively. In addition to the impacts to net income attributable to Fiserv, Inc. described above, our diluted weighted average outstanding shares were reduced by 5% and 6% in the third quarter and first nine months of 2024, respectively, compared to 2023, due to our share repurchase program.

Liquidity and Capital Resources

General

Our primary liquidity needs in the ordinary course of business are to: (i) fund normal operating expenses; (ii) meet the interest and principal requirements of our outstanding indebtedness, including finance leases; and (iii) fund capital expenditures and operating lease payments. We believe these needs will be satisfied in both the short and long term using cash flow generated by our operations, along with our cash and cash equivalents of $1.2 billion, proceeds from the issuance of U.S. dollar and Euro commercial paper, and available capacity under our revolving credit facility of $2.7 billion (net of outstanding revolver borrowings and $3.3 billion of capacity designated for outstanding borrowings under our commercial paper programs, senior notes due within the next twelve months and letters of credit) at September 30, 2024.

The following table summarizes our net cash provided by operating activities, or operating cash flow, and capital expenditures:

			Nine Months Ended September 30,												Increase (Decrease)
(In millions)			2024						2023						$						%
Net income			$	2,232					$	2,240					$	(8)
Depreciation and amortization			2,370						2,384						(14)
Share-based compensation			273						275						(2)
Deferred income taxes			(539)						(344)						(195)
Net gain on sale of businesses and other assets			—						(172)						172
Loss from investments in unconsolidated affiliates			642						11						631
Distributions from unconsolidated affiliates			29						42						(13)
Non-cash impairment charges			14						—						14
Net changes in working capital and other			(611)						(869)						258
Net cash provided by operating activities			$	4,410					$	3,567					$	843					24		%
Capital expenditures, including capitalized software and other intangibles			$	1,170					$	1,034					$	136					13		%

Our operating cash flow was $4.4 billion in the first nine months of 2024, an increase of 24% compared with $3.6 billion in the first nine months of 2023. This increase was primarily attributable to increased profitability, excluding non-cash impairments included within loss from investments in unconsolidated affiliates, and corresponding cash flows, along with favorable fluctuations in working capital, including the timing of vendor payments.

We maintain investments in various affiliates that are accounted for as equity method investments. Total distributions from unconsolidated affiliates, including those classified as cash flows from investing activities, were $88 million and $152 million in the first nine months of 2024 and 2023, respectively.

Our current policy is to use our operating cash flow primarily to fund capital expenditures, merchant cash advances, share repurchases, acquisitions and to repay debt rather than to pay dividends. Our capital expenditures were approximately 8% and 7% of our total revenue for the first nine months of 2024 and 2023, respectively.

Share Repurchases

We repurchased $4.3 billion of our common stock during the first nine months of 2024. On August 8, 2023, we repurchased 4.1 million shares of our common stock for $121.98 per share in a privately negotiated transaction with ValueAct Capital Master Fund, L.P. for an aggregate purchase price of $500 million. Including this transaction, we repurchased $3.7 billion of our common stock during the first nine months of 2023.

On February 22, 2023, our board of directors approved a repurchase authorization for up to 75.0 million shares of our common stock. As of September 30, 2024, we had approximately 24.2 million shares remaining under our existing repurchase authorization. Shares repurchased are generally held for issuance in connection with our equity plans.

Acquisitions and Dispositions

Acquisitions of Businesses

We acquired Skytef in October 2023 and Sled in November 2023 for an aggregate purchase price, including hold-backs, of $17 million. We funded these acquisitions by utilizing available cash. The results of operations for these acquired businesses are included in our consolidated results from the respective dates of acquisition.

Dispositions of Businesses

We sold our financial reconciliation business in July 2023 for cash proceeds of $232 million, subject to final net working capital adjustments. Net proceeds from the sale were primarily used to pay down indebtedness and repurchase shares of our common stock.

Other Transactions

In September 2023, we acquired the remaining 49% ownership interest in European Merchant Services B.V., in which we

previously held a majority controlling financial interest in this consolidated subsidiary, for $56 million. We funded this transaction by utilizing a combination of available cash and proceeds from the issuance of commercial paper.

Indebtedness

Our debt consisted of the following at:

(In millions)			September 30, 2024						December 31, 2023
Short-term and current maturities of long-term debt:
Foreign lines of credit			$	868					$	442
Finance lease and other financing obligations			332						313
Total short-term and current maturities of long-term debt			$	1,200					$	755
Long-term debt:
2.750% senior notes due July 2024			$	—					$	2,000
3.850% senior notes due June 2025			900						900
2.250% senior notes due July 2025 (British Pound-denominated)			704						672
3.200% senior notes due July 2026			2,000						2,000
5.150% senior notes due March 2027			750						—
2.250% senior notes due June 2027			1,000						1,000
1.125% senior notes due July 2027 (Euro-denominated)			559						555
5.450% senior notes due March 2028			900						900
5.375% senior notes due August 2028			700						700
4.200% senior notes due October 2028			1,000						1,000
3.500% senior notes due July 2029			3,000						3,000
4.750% senior notes due March 2030			850						—
2.650% senior notes due June 2030			1,000						1,000
1.625% senior notes due July 2030 (Euro-denominated)			559						555
5.350% senior notes due March 2031			500						—
4.500% senior notes due May 2031 (Euro-denominated)			894						889
3.000% senior notes due July 2031 (British Pound-denominated)			704						672
5.600% senior notes due March 2033			900						900
5.625% senior notes due August 2033			1,300						1,300
5.450% senior notes due March 2034			750						—
5.150% senior notes due August 2034			900						—
4.400% senior notes due July 2049			2,000						2,000
U.S. dollar commercial paper notes			317						418
Euro commercial paper notes			1,329						1,321
Revolving credit facility			70						74
Unamortized discount and deferred financing costs			(160)						(145)
Finance lease and other financing obligations			659						652
Total long-term debt			$	24,085					$	22,363

In August 2024, we completed the public offering and issuance of $1.75 billion of senior notes, comprised of $850 million aggregate principal amount of 4.750% senior notes due in March 2030 and $900 million aggregate principal amount of 5.150% senior notes due in August 2034. We used the net proceeds from this senior notes offering for general corporate purposes, including the repayment of a portion of our commercial paper notes and for share repurchases.

In March 2024, we completed the public offering and issuance of $2.0 billion of senior notes, comprised of $750 million aggregate principal amount of 5.150% senior notes due in March 2027, $500 million aggregate principal amount of 5.350% senior notes due in March 2031 and $750 million aggregate principal amount of 5.450% senior notes due in March 2034. We

used the net proceeds from this senior notes offering for general corporate purposes, including the repayment of a portion of our commercial paper notes and for share repurchases, and in July 2024, the repayment of a portion of our 2.750% senior notes.

At September 30, 2024, our debt consisted primarily of $21.9 billion of fixed-rate senior notes and $1.6 billion of outstanding borrowings under our commercial paper programs. Interest on our U.S. dollar-denominated senior notes is paid semi-annually, while interest on our Euro and British Pound-denominated senior notes is paid annually. Interest on our revolving credit facility and commercial paper notes is generally paid weekly, or more frequently on occasion.

At September 30, 2024, the 3.850% senior notes due in June 2025 and 2.250% senior notes due in July 2025 were classified in the consolidated balance sheet as long-term, as we have the intent to refinance this debt on a long-term basis, and the ability to do so under our revolving credit facility. Outstanding borrowings under the commercial paper programs are also classified in the consolidated balance sheet as long-term, as we have the intent to refinance this commercial paper on a long-term basis through the continued issuance of new commercial paper upon maturity, and also have the ability to refinance such commercial paper under our revolving credit facility.

Variable Rate Debt

Our variable rate debt consisted of the following at September 30, 2024:

(In millions)			Maturity						Weighted-Average Interest Rate						Outstanding Borrowings
Foreign lines of credit			various						34.503%						$	868
U.S. dollar commercial paper notes			various						4.933%						317
Euro commercial paper notes			various						3.629%						1,329
Revolving credit facility			June 2027						5.970%						70
Total variable rate debt									14.224%						$	2,584

We maintain various short-term lines of credit and other borrowing arrangements with foreign banks and alliance partners primarily to fund merchant settlement advances associated with operations in Latin America, including an annually renewable term loan facility to fund settlement advance cash payments in Brazil. This term loan has a notional value of 514 million Brazilian real ($95 million USD equivalent) at September 30, 2024 and bears interest at a variable Certificado de Depósito Interbancário (CDI) Rate, plus a specified margin per annum. In February 2024, this term loan facility was amended, which amendment extended its maturity date to April 2025 and decreased the specified margin to 1.25% per annum.

The following table provides a summary of the outstanding borrowings and weighted average interest rates of our foreign lines of credit and other borrowing arrangements by country at September 30, 2024:

			Outstanding Borrowings (in millions)						Weighted-Average Interest Rate
Argentina			$	635											43.775		%
Brazil			109												11.663		%
Uruguay			52												10.061		%
Other			72												5.061		%
Total			$	868											34.503		%

We offer advanced funding of settlement activity associated with operations in Argentina by utilizing local operating cash and various short-term lines of credit to borrow in the Argentina overnight market. As we collect a portion of the corresponding receivables from card issuers over several months, in the event we are unable to continue to borrow in the Argentina overnight market, we may fund future advances with our consolidated cash and cash equivalents and available capacity under our revolving credit facility.

We maintain unsecured U.S. dollar and Euro commercial paper programs with various maturities generally ranging from one day to four months. Outstanding borrowings under our commercial paper programs bear interest based on the prevailing rates at the time of issuance.

We also maintain a senior unsecured multicurrency revolving credit facility, which matures in June 2027 and provides for a maximum aggregate principal amount of availability of $6.0 billion. Borrowings under the credit facility bear interest at a

variable base rate, determined by the term and currency of the borrowing, plus a specified margin based on our long-term debt rating. Outstanding borrowings under the revolving credit facility were $70 million at September 30, 2024. We are required to pay a facility fee based on the aggregate commitments in effect under the credit agreement from time to time.

Debt Covenants and Compliance

The indentures governing our senior notes contain covenants that, among other matters, limit (i) our ability to consolidate or merge with or into, or convey, transfer or lease all or substantially all of our properties and assets to, another person, (ii) our and certain of our subsidiaries’ ability to create or assume liens, and (iii) our and certain of our subsidiaries’ ability to engage in sale and leaseback transactions. We may, at our option, redeem the senior notes, in whole or in part, at any time and from time to time, at the applicable redemption price.

The revolving credit facility contains various restrictions and covenants that require us to, among other things, limit our consolidated indebtedness as of the end of each fiscal quarter to no more than 3.75 times our consolidated net income before interest, taxes, depreciation, amortization, non-cash charges and expenses and certain other adjustments during the period of four fiscal quarters then ended, subject to certain exceptions.

During the first nine months of 2024, we were in compliance with all financial debt covenants. Our ability to meet future debt covenant requirements will depend on our continued ability to generate earnings and cash flows. We expect to remain in compliance with all terms and conditions associated with our outstanding debt, including financial debt covenants.

Debt Guarantees

We maintain noncontrolling ownership interests in Sagent M&C, LLC and defi SOLUTIONS Group, LLC (collectively, the “Lending Joint Ventures”). The Lending Joint Ventures maintain variable-rate term loan facilities with aggregate outstanding borrowings of $426 million in senior unsecured debt at September 30, 2024 and variable-rate revolving credit facilities with an aggregate borrowing capacity of $83 million with a syndicate of banks, which mature in April 2027. There were $20 million of aggregate outstanding borrowings on the revolving credit facilities at September 30, 2024. We have guaranteed the debt of the Lending Joint Ventures. We maintained a liability of $24 million at September 30, 2024 for the estimated fair value of our non-contingent obligations to stand ready to perform over the term of the guarantee arrangements. Such guarantees will be amortized in future periods over the contractual term of the debt. In addition, we maintained a contingent liability of $17 million at September 30, 2024, representing the current expected credit losses to which we are exposed. This contingent liability is estimated based on certain financial metrics of the Lending Joint Ventures and historical industry data, which is used to develop assumptions of the likelihood the guaranteed parties will default and the level of credit losses in the event a default occurs. We have not made any payments under the guarantees, nor have we been called upon to do so, and do not anticipate that the Lending Joint Ventures will fail to fulfill their debt obligations.

Cash and Cash Equivalents

Investments, exclusive of settlement assets, with original maturities of 90 days or less that are readily convertible to cash are considered to be cash equivalents as reflected within our consolidated balance sheets.

The table below details our cash and cash equivalents held at:

(In millions)			September 30, 2024						December 31, 2023
Available			$	617					$	450
Unavailable (1)			611						754
Total			$	1,228					$	1,204

(1)Represents cash held by our joint ventures that is not available to fund operations outside of those entities unless the board of directors of the relevant entity declares a dividend, as well as cash held by other entities that are subject to foreign exchange controls in certain countries or regulatory capital requirements.