FISERV INCFISV
FISERV INC Revenue Disclosure
Revenue Recognition
Significant Accounting Policy
ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”), outlines a single comprehensive model to use in accounting for revenue arising from contracts with customers. The core principle, involving a five-step process, of the revenue model is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.
Revenue is measured based on consideration specified in a contract with a customer and excludes any amounts collected on behalf of third parties. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. Shipping and handling activities associated with outbound freight after control over a product has transferred to a customer are accounted for as a fulfillment activity and recognized as revenue at the point in time at which control of the goods transfers to the customer. As a practical expedient, the Company does not adjust the transaction price for the effects of a significant financing component if, at contract inception, the period between customer payment and the transfer of goods or services is expected to be one year or less.
Nature of Goods and Services
The Company’s operations are comprised of the Merchant and the Financial reportable segments (see Note 19). The following is a description of principal activities from which the Company generates its revenue. Contracts with customers are evaluated on a contract-by-contract basis as contracts may include multiple types of goods and services as described below.
Processing and Services
Processing and services revenue is generated from account- and transaction-based fees for merchant transaction processing and acquiring, electronic billing and payment services, electronic funds transfer and debit/credit processing services; consulting and professional services; merchant cash advances; and software maintenance for ongoing client support.
The Company recognizes processing and services revenue in the period in which the specific service is performed unless such service is not deemed distinct from other goods or services in which revenue would then be recognized as control is transferred of the combined goods and services. The Company’s arrangements for processing and services typically consist of an obligation to provide specific services to its customers on a when and if needed basis (a stand-ready performance obligation) and revenue is recognized from the satisfaction of the performance obligations in the amount billable to the customer. These services are typically provided under a fixed or declining (tier-based) price per unit based on volume of service; however, pricing for
services may also be based on fixed or monthly minimum processing fees. Fees for the Company’s processing and services arrangements are typically billed and paid on a monthly basis.
Product
Product revenue is generated from print and card production, software license, data and analytics, and hardware (primarily POS devices) sales.
For software license agreements that are distinct, the Company recognizes software license revenue upon delivery, assuming a contract is deemed to exist. Revenue for arrangements with customers that include significant customization, modification or production of software such that the software is not distinct is typically recognized over time based upon efforts expended, such as labor hours, to measure progress towards completion. For arrangements involving hosted licensed software for the customer, a software element is considered present to the extent the customer has the contractual right to take possession of the software at any time during the hosting period without significant penalty and it is feasible for the customer to either operate the software on their own hardware or contract with another vendor to host the software.
The Company maintains substantial volumes of payment and transaction data, providing insights into business and consumer activity. The Company accounts for the sales of distinct data and analytics as a separate performance obligation and recognizes the revenue at its standalone selling price when the customer obtains control of the analytical data.
The Company sells or leases hardware (POS devices) and other peripherals as part of its contracts with customers. Hardware typically consists of POS terminals or Clover® devices. The Company does not manufacture hardware; rather, it purchases hardware from third-party vendors and holds such hardware in inventory until purchased by a customer. The Company accounts for sales of distinct hardware as a separate performance obligation and recognizes the revenue at its standalone selling price when the customer obtains control of the hardware.
In certain instances, the Company may offer extended payment terms beyond one year. To the extent a significant financing component exists, it is calculated as the difference between the promised consideration and the present value of the product fees utilizing a discount rate reflective of a separate financing transaction, and is recognized as interest income over the extended payment period. The present value of the product fees is recognized as revenue at the point in time when the product is transferred to the customer.
Significant Judgments in Application of the Guidance
The Company uses the following methods, inputs and assumptions in determining amounts of revenue to recognize:
Identification of Performance Obligations
To identify its performance obligations, the Company considers all of the goods or services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices. For multi-element arrangements, the Company accounts for individual goods or services as a separate performance obligation if they are distinct, the good or service is separately identifiable from other items in the arrangement and if a customer can benefit from it on its own or with other resources that are readily available to the customer. If these criteria are not met, the promised goods or services are accounted for as a combined performance obligation. Determining whether goods or services are distinct performance obligations that should be accounted for separately may require significant judgment.
Technology or service components from third parties are frequently embedded in or combined with the Company’s applications or service offerings. Whether the Company recognizes revenue based on the gross amount billed to a customer or the net amount retained involves judgment that depends on the relevant facts and circumstances, including the level of contractual responsibilities and obligations for delivering solutions to end customers, to determine whether control of goods and services is obtained prior to their transfer to a customer.
Determination of Transaction Price
The transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring goods or services to the customer. The Company includes any fixed charges within its contracts as part of the total transaction price. To the extent that variable consideration is not constrained, the Company includes an estimate of the variable amount, as appropriate, within the total transaction price and updates its assumptions over the duration of the contract.
Assessment of Estimates of Variable Consideration
Many of the Company’s contracts with customers contain some component of variable consideration; however, the constraint will generally not result in a reduction in the estimated transaction price for most forms of variable consideration. The Company may constrain the estimated transaction price in the event of a high degree of uncertainty as to the final consideration amount owed.
Allocation of Transaction Price
The transaction price (including any discounts or rebates) is allocated between distinct goods and services in a multi-element arrangement based on their relative standalone selling prices. The standalone selling prices are determined based on the prices at which the Company separately sells each good or service. For items that are not sold separately, the Company estimates the standalone selling prices using available information such as market conditions and internally approved pricing guidelines. Judgment may be required to determine standalone selling prices for each performance obligation and whether it depicts the amount the Company expects to receive in exchange for the related good or service.
Contract Modifications
Contract modifications occur when the Company and its customers agree to modify existing customer contracts to change the scope or price (or both) of the contract or when a customer terminates some, or all, of the existing services provided by the Company. When a contract modification occurs, it requires the Company to exercise judgment to determine if the modification should be accounted for as (i) a separate contract, (ii) the termination of the original contract and creation of a new contract, or (iii) a cumulative catch up adjustment to the original contract. Further, contract modifications require the identification and evaluation of the performance obligations of the modified contract, including the allocation of consideration to the remaining performance obligations and the period of revenue recognition for each identified performance obligation.
Disaggregation of Revenue
The table below presents the Company’s revenue disaggregated by business line and includes a reconciliation with its reportable segments. The Company serves its global client base by working among its geographic teams across various regions, including the U.S. and Canada; Europe, Middle East and Africa (“EMEA”); Latin America (“LATAM”); and Asia Pacific (“APAC”). The majority of the Company’s revenue is earned in the U.S., with revenue generated within its EMEA, LATAM and APAC regions comprising approximately 16% of total revenue for the year ended December 31, 2025, and approximately 15% of total revenue for each of the years ended December 31, 2024 and 2023.
(In millions) | Year Ended December 31, | |||||||||||||||||||
| Revenue by Business Line | 2025 | 2024 | 2023 | |||||||||||||||||
| Small Business | $ | 6,795 | $ | 6,357 | $ | 5,664 | ||||||||||||||
| Enterprise | 2,256 | 2,163 | 1,933 | |||||||||||||||||
| Processing | 1,089 | 1,111 | 1,125 | |||||||||||||||||
| Total Merchant Solutions segment revenue | $ | 10,140 | $ | 9,631 | $ | 8,722 | ||||||||||||||
| Digital Payments | $ | 3,945 | $ | 3,869 | $ | 3,655 | ||||||||||||||
| Issuing | 3,284 | 3,112 | 3,011 | |||||||||||||||||
| Banking | 2,435 | 2,496 | 2,435 | |||||||||||||||||
| Total Financial Solutions segment revenue | $ | 9,664 | $ | 9,477 | $ | 9,101 | ||||||||||||||
| Corporate and Other | $ | 1,389 | $ | 1,348 | $ | 1,270 | ||||||||||||||
Total Revenue (1) | $ | 21,193 | $ | 20,456 | $ | 19,093 | ||||||||||||||
(1)Total revenue includes $1.5 billion, $1.2 billion and $1.1 billion for the years ended December 31, 2025, 2024 and 2023, respectively, which represent revenue recognized outside the scope of ASC 606. Such revenue primarily consists of interest-related income earned on merchant and settlement anticipation cash advances, on short-term investments of subscriber funds and intermediary settlement cash balances, and lease income associated with POS terminal equipment.
Contract Balances
The following table provides information about contract assets and contract liabilities from contracts with customers:
| December 31, | |||||||||||||||||
| (In millions) | 2025 | 2024 | 2023 | ||||||||||||||
| Contract assets | $ | 885 | $ | 832 | $ | 754 | |||||||||||
| Contract liabilities | 1,124 | 1,082 | 1,011 | ||||||||||||||
Contract assets, reported within other long-term assets in the consolidated balance sheets, primarily relate to customer discounts (contract incentives) where revenue is recognized and payment of consideration under the contract is contingent upon the transfer of services to a customer over the contractual period. Contract liabilities primarily relate to advance consideration received from customers (deferred revenue) for which transfer of control occurs, and therefore revenue is recognized, as services are provided. Contract balances are reported in a net contract asset or liability position on a contract-by-contract basis at the end of each reporting period.
During the years ended December 31, 2025 and 2024, contract assets increased primarily due to customer discounts (contract incentives) and contract liabilities increased primarily due to customer prepaid maintenance and deferred conversion/implementation revenue associated with long-term contracts obtained during the respective year. The Company recognized $819 million and $761 million of revenue during the years ended December 31, 2025 and 2024, respectively, that was included in the contract liabilities balance at the beginning of the year.
Transaction Price Allocated to Remaining Performance Obligations
The following table includes estimated processing and services revenue expected to be recognized in the future related to performance obligations that were unsatisfied (or partially unsatisfied) at December 31, 2025:
| (In millions) | |||||
| Year Ending December 31, | |||||
| 2026 | $ | 2,537 | |||
| 2027 | 1,952 | ||||
| 2028 | 1,411 | ||||
| 2029 | 842 | ||||
| Thereafter | 826 | ||||
The Company applies the optional exemption under ASC 606 and does not disclose information about remaining performance obligations for account- and transaction-based processing fees that qualify for recognition under the as-invoiced practical expedient. These multi-year contracts contain variable consideration for stand-ready performance obligations for which the exact quantity and mix of transactions to be processed are contingent upon the customer’s request. The Company also applies the optional exemptions under ASC 606 and does not disclose information for variable consideration that is a sales-based or usage-based royalty promised in exchange for a license of intellectual property or that is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service in a series. The amounts disclosed above as remaining performance obligations consist primarily of fixed or monthly minimum processing fees and maintenance fees under contracts with an original expected duration of greater than one year.
Contract Costs
The Company incurs incremental costs to obtain a contract as well as costs to fulfill contracts with customers that are expected to be recovered. These costs consist of sales commissions incurred only if a contract is obtained, and customer conversion or implementation related costs. Capitalized sales commissions and conversion or implementation costs were as follows:
| December 31, | ||||||||||||||
| (In millions) | 2025 | 2024 | ||||||||||||
| Capitalized sales commissions | $ | 481 | $ | 483 | ||||||||||
| Capitalized conversion or implementation costs | 558 | 513 | ||||||||||||
Capitalized contract costs are amortized based on the transfer of goods or services to which the asset relates. The amortization period also considers expected customer lives and whether the asset relates to goods or services transferred under a specific anticipated contract. The amortization of capitalized sales commissions is included in selling, general and administrative expenses and the amortization of capitalized conversion or implementation costs within cost of processing and services. Amortization totaled $228 million, $221 million and $195 million during the years ended December 31, 2025, 2024 and 2023, respectively. Impairment losses recognized during the years ended December 31, 2025, 2024 and 2023 related to capitalized contract costs were not significant.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 19, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
| 2023 | Feb 22, 2024 | |
| 2022 | Feb 23, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Feb 26, 2021 | |
| 2019 | Feb 27, 2020 | |
| 2018 | Feb 21, 2019 | |
About Revenue Disclosures
Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.
Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.