Fidelity National Information Services (FIS) 2Q26 Takeaways Shares decline on capital markets reset

Equity Research 5 August 2026 | 12:15AM EDT

Fidelity National Information Services (FIS): 2Q26 Takeaways: Shares decline on capital markets reset

Bottom line: Shares underperformed, but pared earlier losses, as we believe that the Will Nance | guide down on Capital markets was partially expected and positioning skewed Goldman Sachs & Co. LLC

negative. While the Capital Markets issues are likely to remain an overhang as Jack Evans | investors attempt to separate execution related issues from a lower structural Goldman Sachs & Co. LLC

growth rate in that business, we think the message on banking is relatively consistent, Chandru Ravikumar | with the company signaling strong recurring ACV trends and accelerating recurring Goldman Sachs India SPL revenue growth. That said, we believe numbers for 2027 will likely need to re-base slightly lower, as non-recurring headwinds and lack of M&A in 2027 will likely imply banking revenues towards the lower end of the range (we are modeling mid-3s). However, big picture, we think the longer term view still revolves around the steady improvement in GAAP FCF and a return to more compounder-like performance. We think FIS needs to demonstrate better visibility to forward results over time to see its multiple improve, but ultimately we see the improving FCF trajectory as the most important part of the story. While shares likely need to take a breather now as the market digests the lower growth rate and another reset on numbers, we continue to remain positive on the company’s competitive moat and the elevated growth in GAAP FCF over the next several years.

Segment dynamics: FIS reported 2Q26 segment revenue of ~$3.293bn, which was in-line with consensus estimates. Adjusted EBITDA from consolidated FIS segments came in at $1.409bn, which was slightly ahead of consensus at $1.406bn (Visible Alpha Consensus Data).

n Banking Solutions: Revenue came in at $2.483bn in 2Q26 (+44% adjusted basis), which was in-line with consensus at $2.481bn. Banking Solutions adjusted EBITDA came in at ~$1.137bn with a ~45.8% margin, compared to ~$1.114bn (VA) and ~45% margin expected by consensus. n Capital Markets: Revenue came in at $810mn in 2Q26 (+3% on an adjusted basis), -1% below consensus. Capital Markets adjusted EBITDA came in at ~$420mn with a ~51.9% margin, compared to $430mn (VA) and a ~53% margin expected by consensus.

FY26 Guidance: FY26 Guidance: For FY26, the company cut its outlook for full year revenues between $ bn. FIS anticipates adjusted EBITDA between $5.730-5.785bn, implying 42.0%-42.2% margin. FIS expects FY26 adjusted EPS

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Goldman Sachs Fidelity National Information Services (FIS)

between the range of $6.15-6.24. For 3Q26, the company now expects revenues between $3.415-3.445bn. FIS anticipates adjusted EBITDA between $1.460-1.480bn, implying 42.8%-43.0% margin. FIS expects 3Q26 adjusted EPS between the range of $1.58-1.62.

Exhibit 1: FIS valuation Valuation methodology Q5-Q EBITDA - EBITDA - EBITDA - EBITDA - $ mn GP EBITDA EPS GP EBITDA EPS GP EBITDA EPS GP EBITDA EPS SBC SBC SBC SBC Multiple 9x 7x 8x 8x 9x 8x 8x 8x 9x 8x 8x 8x 8.4x 7.2x 7.5x 7.3x Valuation KPI $5,359 $6,198 $5,970 $6.75 $4,978 $5,761 $5,546 $6.19 $5,224 $6,036 $5,808 $6.49 $5,515 $6,376 $6,148 $7.10 Implied EV $46,064 $46,064 $46,064 $46,064 $46,064 $46,064 $46,064 $46,064 $46,064 $46,064 $46,064 $46,064 Less: Q5E Net debt $19,217 $19,217 $19,217 $19,217 $19,217 $19,217 $19,217 $19,217 $19,217 $19,217 $19,217 $19,217 Market cap $26,848 $26,848 $26,848 $26,848 $26,848 $26,848 $26,848 $26,848 $26,848 $26,848 $26,848 $26,848 Diluted shares outstanding -month Price target $52.00 $52.00 $52.00 $52.00 $52.00…