Global Payments Q2 Earnings Call Highlights

Key Points

• Q2 performance remained resilient: Global Payments reported 4% normalized adjusted net revenue growth, 70 basis points of operating-margin expansion and 12% adjusted EPS growth to $3.46, despite travel-related pressure from the Middle East conflict.
• Full-year guidance was lowered: The company now expects 2026 normalized constant-currency revenue growth of approximately 4% to 5% and adjusted EPS of $13.60 to $13.80, while maintaining its 150-basis-point margin-expansion target.
• Growth initiatives advanced: Worldpay integration milestones, stronger Enterprise and Platforms results, accelerating Genius point-of-sale bookings and expanded AI applications support management’s second-half outlook, while the company also repurchased $550 million of shares during the quarter.

Global Payments NYSE: GPN reported second-quarter results that included 4% normalized adjusted net revenue growth, 70 basis points of adjusted operating-margin expansion and a 12% increase in adjusted earnings per share, while lowering its full-year revenue and earnings outlook to reflect continued pressure on travel-related volumes from the Middle East conflict.

Chief Executive Officer Cameron Bready said the company’s results demonstrated “the durability of our business model” despite an approximately 100-basis-point headwind to normalized revenue growth from reduced travel-sector activity. Adjusted net revenue totaled $3.16 billion in the quarter, while adjusted diluted earnings per share were $3.46.

Updated Outlook Reflects Travel Pressure

Chief Financial Officer Josh Whipple said Global Payments now expects normalized constant-currency adjusted net revenue growth of approximately 4% to 5% for full-year 2026. The company previously assumed that travel activity would normalize by the end of the second quarter, but now expects conflict-related impacts to continue for the balance of the year.

The company forecast adjusted earnings per share of $13.60 to $13.80 for 2026, representing growth of 11% to 13%. It maintained its expectation for approximately 150 basis points of normalized adjusted operating-margin expansion for the year and said foreign exchange rates are now expected to have roughly no impact on reported growth, following the strengthening of the U.S. dollar.

For the second half, Whipple said the company expects revenue growth of about 4.5%, approximately 200 basis points of margin expansion and margins near 43%. Management cited the ramp of an expanded sales force, increased Genius point-of-sale sales, and enterprise customers going live as drivers of improved second-half performance.

Bready said travel capacity and forward bookings in the affected portfolio remain below pre-conflict levels. He noted that returning capacity has been more concentrated in short-haul, lower-yielding domestic routes than long-haul routes. The company described the conflict’s impact as modest and transitory but said it adopted a more conservative assumption because conditions remain uncertain.

Worldpay Integration and Segment Results

Global Payments said its Worldpay integration reached several milestones during the quarter. The company completed its operating-model design and leadership structure, established a target architecture for the combined technology environment, and aligned its commercial organization around three operating segments: SMB, Enterprise and Platforms.

• SMB: Adjusted net revenue was $1.51 billion, up 4% on a normalized basis, with volume growth of 4%. Adjusted operating income was $891 million, for a 59% contribution margin.
• Enterprise: Adjusted net revenue was $838 million, up 7% on a normalized basis despite an approximately 400-basis-point headwind from the Middle East conflict. Enterprise volumes increased 4%, while card-not-present revenue grew at a low-double-digit rate. Adjusted operating income was $653 million, producing a 78% contribution margin.
• Platforms: Adjusted net revenue was $628 million, up 7% on a normalized basis, as segment volume increased 10%. Adjusted operating income was $284 million, for a 45% contribution margin.

Management said Enterprise bookings rose 10% year to date. The company cited new customer wins including Shangri-La Hotels, IG Group and BingX, and said it expanded its relationship with Domino’s Pizza to become the exclusive provider of card-present and card-not-present payments in the U.S. About one-third of recently signed enterprise clients went live in the second quarter, including Aldi, Morrisons and Careem in the United Arab Emirates.

In Platforms, Global Payments signed 48 new partners during the quarter, with more than half of the wins coming from international partners. Platforms value-added-services revenue rose 25%, driven by FraudSight payouts, prime routing and merchant working capital.

Genius Rollout and AI Initiatives

Global Payments continued to emphasize its Genius point-of-sale platform as a long-term growth initiative in SMB. Bready said new merchant locations per quota-carrying sales professional increased 30% since the start of the year, contributing to a more than 25% sequential increase in Genius bookings during the second quarter. New customer yields rose 75% year over year, according to the company.

New Genius locations increased more than 50% year over year and nearly 25% sequentially. Global Payments said Desjardins is selling Genius in Canada, while 30 of Worldpay’s largest U.S. financial-institution partners are expected to begin selling the platform during the fourth quarter.

The company also introduced a Genius handheld device designed for edge AI and an AI reporting tool that enables users to ask questions in natural language about operational and reporting data. Bready said the company’s newest Genius commercial helped drive a nearly 60% increase in Google-branded searches for the product.

Across its business, Global Payments said it is using AI to support fraud management, authorization optimization and customer service. Its Revenue Boost solution, already generating $2 billion in annual approval uplift, is delivering an additional 50-basis-point increase in approval rates through AI-powered decisioning, Bready said. The company also said it has multiple agentic-commerce pilots underway with AI platforms and global retailers.

Cash Flow, Buybacks and Leverage

Global Payments generated $687 million in adjusted free cash flow during the second quarter, equal to approximately 75% conversion of adjusted net income. The company expects adjusted free-cash-flow conversion to exceed 90% for the full year, with stronger conversion in the second half due to its typical seasonal pattern.

The company spent $236 million on capital expenditures, or about 7% of revenue, during the quarter. It repurchased roughly 8 million shares for $550 million through accelerated and open-market repurchases and said it is more than halfway toward its commitment to return more than $2 billion to shareholders in 2026, including dividends.

Global Payments ended the quarter with net leverage just below 3.5 times. More than 90% of its debt was fixed rate, with a weighted average cost of approximately 4%. The company reiterated its plan to preserve investment-grade credit ratings and reach a 3-times net leverage target by the end of 2027.

About Global Payments (NYSE:GPN)

Global Payments Inc NYSE: GPN is a worldwide provider of payment technology and software solutions that enables commerce for merchants, issuers and enterprises. The company develops and operates payment processing networks, point-of-sale systems and cloud-based software that facilitate electronic transactions across in-store, online and mobile channels. Its services span merchant acquiring, payment gateway services, omnichannel commerce platforms, and solutions for recurring and subscription billing.

Global Payments offers a range of products and services including integrated payment terminals and point-of-sale software, e-commerce and gateway technologies, fraud prevention and tokenization tools, and business analytics and reporting.

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