Global Payments (GPN) Q2 2024 earnings summary

Executive summary

• Achieved 6% adjusted net revenue growth (7% excluding Netspend divestiture) and 12% adjusted EPS growth year-over-year, with 40 basis points of adjusted operating margin expansion in Q2 2024.

• GAAP revenue increased 5% to $2.57B; net income attributable to Global Payments rose 37% to $375M, and diluted EPS increased 40% to $1.47.

• Strong performance in Merchant Solutions, driven by high single-digit organic growth, double-digit ISV and vertical market bookings, and robust expansion in LATAM.

• Continued focus on technology enablement, embedded commerce, software-led strategies, and new partnerships, including Diamond Baseball Holdings and UK football clubs.

• Strategic tuck-in acquisitions in Europe, ongoing integration of EVO Payments, and divestiture of consumer and gaming businesses support global expansion and margin improvement.

Financial highlights

• Adjusted net revenue: $2.32 billion, up 6% year-over-year (7% excluding Netspend divestiture), with a 50 bps FX headwind.

• Adjusted operating margin: 45.2%, up 40 bps; adjusted EPS: $2.93, up 12% year-over-year.

• Merchant Solutions adjusted net revenue: $1.81 billion, up 8%; Issuer Solutions adjusted net revenue: $527 million, up over 4%.

• Adjusted free cash flow: ~$680 million, up 25% year-over-year, with a 91% conversion rate of adjusted net income.

• GAAP operating margin was 22.3%, down from 24.6% in Q2 2023.

Outlook and guidance

• 2024 adjusted net revenue expected at $9.17–$9.30 billion, 6–7% growth over 2023.

• Annual adjusted operating margin to expand up to 50 bps; merchant segment revenue growth of 9%+ and up to 30 bps margin expansion.

• Issuer Solutions revenue growth expected at low end of 5–6% range due to FX and commercial card headwinds.

• Full-year adjusted EPS guidance: $11.54–$11.70, up 11–12% year-over-year.

• Adjusted free cash flow conversion estimated at ~100% of adjusted net income.