Fiserv, Inc. (FISV) Earnings Call Transcript & Summary

All right, everyone. Right back at it. 1 p.m. session, we have one of my favorite people, Frank Bisignano, now Chief Executive Officer of Fiserv. Frank, thank you for joining us.

Thanks for having me. Great to be here, and it's all my pleasure anytime I can do it, yet preferred in person, but I look forward to add a little later in time. I think I'd like to take kind of a global view of what's going on here. Our company is performing extremely well. You saw the first quarter. We could talk about that a little bit. But we do have issues around the world. I mean -- and they affect our U.S. population also because we have many employees with families in India. We have many employees with families in Latin America. And although that's not meaningful parts of the totality of the company, when I think about how these people have performed during this very, very difficult time -- and it's been a really long journey. And specifically for those who have relatives in other countries, it's been an outstanding performance. So I'm honored to be here. I'm honored to have the opportunity and I'm honored to serve the people inside our company who serve our clients so well. I think when you look at the quarter, 4% internal revenue growth, 360 basis points of margin expansion and 18% EPS and obviously, that was the beginning of a change. You see the power, we talked about Q2 in March, but we see a very, very strong April behind us. And I think we're just going to see that continue and bodes very well for '21 and beyond for a terrific future. So great to be here, and I'm happy to answer any and all questions.

Well, I have lots of them. So we're going to...

I was sure. I was sure.

And also just audience, I'll remind you, as I always do, when we start these, you can feel free to send questions in for Frank via the Ask a Question function in your webcast. I will see them. I'll bring them up. I've been weaving them in where they -- as we go through the discussion. So don't feel like you're holding it to the end, just go ahead and send them throughout and we'll weave them in. All right. Well, I will start, of course, with Fiserv's Merchant Acceptance business. You -- Merchant Acceptance is about 40% of Fiserv's business. And you touched on this segment a bit in your comments just now, but can you just talk a little bit more specifically about how Merchant Acceptance has been doing now that we've lapped the pandemic?

We talked about for medium term, this is a 9% to 12% business. And I'd like to remind us, over $5.4 billion today of revenue through the pandemic and that, assuming that this business does exactly what we've been, puts it circa at a $6 billion business, growing 9% to 12%. And if you go back in time and I always like to do this because I think if you look at '18, it grew 7-ish; in '19, it grew 10-ish. So our expectations are to do better than we did before, but these are not anywhere within the heroic ranges. And as we come through, you heard us talk about our volumes in March. And when you look at April, it's significantly stronger. One way I look to is go back to '19, and what we see is a much greater acceleration rate from March to April in terms of that second half of March and April. So fields very, very strong. We had talked about the company as a low double digit in March. Obviously, Merchant drove that a lot. We also see very strong yield gains in April as the SMBs are coming back. And our U.S. business really is predominantly an SMB business. And so that feels very good about the revenue acceleration we see in April versus March, and we feel very good about the March numbers.

All right. When you mentioned the 9% to 12%, just wanted to follow up on that. That was back at Investor Day in December, you gave medium-term revenue guidance for Merchant Acceptance at 9% to 12%. As you highlighted, in 2019, this business did between 9% and 10%, and that was an acceleration from the prior year. So just looking out, what is it that's giving you the confidence to set that range at a level that's higher than where this business was pre-pandemic?

Yes. Well, I think it starts with all the investments we've made. I think we have leading next-generation technology. We really, really feel that in Clover, and our SMB clients feel it in Clover, what we've built out in ISV with CardConnect and bringing together Clover and creating Clover Connect, our Carat enterprise solution how global reach. Remember, we have the largest business in the industry. I think we have the most global business and diverse business. And that means a large diverse client set. I think distribution's off the charts for us and continues to expand. Obviously, Paychex, Verizon, Deluxe, but they only come back. And I just talked to the CEO of Scotiabank before I came on the phone, and we were sharing our expectations of what that means for such a large Brazilian franchise to put all their faith in one provider like ourselves. So I think there is an example. We have revenue synergies both from cross-sales. We're signing up hundreds of banks with our privileged position, account processing. We have disbursement capabilities. And we do feel very strongly about our omni e-commerce product capabilities. So you think about the cyclical tailwinds, you think us -- about us investing through this cycle, and then you think about the reality of the businesses. The e-comm business, we talked about, it's over $1 billion. We're seeing revenue growth there, very, very strong. As we come through this pandemic, we could see our way at 30% year-over-year there, and we see it accelerating in the future. Our SMB franchise, Clover leads. I mean there's a lot of competitors out there, but we feel very, very strong. And remember, we talked about Clover is not cannibalizing. Clover is leading with new business acquisition. And we think about how that's grown 75% from Q1 '19 to Q1 this year. So those capabilities all lined up tremendously allows us to look at our current business mix, our current client mix, the steady progress we've made on key investments. When you look at the ISV investment, we signed 42 new ISV partners. We feel very, very good about our ability. And we feel good about our ability to go outside the U.S. over time with that. So I think there's nothing heroic about delivering it. I mean it's good work, and we got a great team on the ground delivering it.

All right. Got it. Well, thinking of competitive positioning a little bit, there's a wide range of players that participate in the Merchant Acceptance business in various forms, coming at it, international players, e-comm-centric players, all [ in one place ]. So how do you articulate where Fiserv is really differentiated relative to other players?

Well, I think our value prop is unique in a different way than others. I would start off with the most global franchise out there. I'd start off with the product depth from SMB all the way up to the largest institutions, our partner-focused model and our technology capability. So we think we're very differentiated because of our scale and product and capability and technology. And there is a deep belief by ourselves that this omnichannel journey we're on, our depth and capability in the physical space and through our platforms and our tremendous partners there and our e-commerce business brought together, gives us a strategic advantage. I think we've made a lot of investments in the platforms. We continue to grow it. We also believe with the issuing data we have and with the merchant data we have, we're able to drive incremental growth and optimization opportunities for our largest clients. And I don't think that's simple for new entrants. So there's a proven focus by us in some verticals, whether it's QSRs, restaurants, grocery, petro and even now stadiums. And I believe it's unmatched. Our FI partnerships or I believe when you look at it and you look at what we've done and continue to do, whether it's Caixa or whether it's all the bank partnerships we've signed up since the deal, is unparalleled. And I think our service model has changed over time to be a high-quality, high-service provider to large institutions and small. So we love technology innovation. We're going to do as much as anybody. Yes, we do start with $6 billion, the one we've done this year of revenue. So that means we're going to compete in a lot of different places, both physically and technically. But I think we go head-to-head all day with people, and we come out pretty darn good.

Well, you highlighted your global footprint right off the bat there. So international, I think one of the areas of Merchant Acceptance that's often overlooked, it's about 25% of the segment and has been growing as high as in the mid-teens, I think, in certain geographies, even significantly higher than that. So can you talk about what your initiatives are to build out more footprint internationally? And would you consider M&A as part of that strategy?

Yes. Well, I would start off with we do have great franchises, and the company is -- always had them. And then we've tried to build and expand over those franchises. I like to point to Brazil because when we started on this journey, we had no business in Brazil in Merchant Acceptance. And we've sure built that up a heck of a lot, and that's through good partnerships. I also think that Clover is already outside the U.S., will continue to be outside the U.S. where it is and will continue to build functionality and move to more geographies. I think about EMEA, 43% year-over-year purchase volume growth there in 2020 driven by Clover, so that ongoing investment. I also believe our enterprise stack shows up very strong globally. So our U.S. footprint enhances our global footprint, and our global footprint gives access to the U.S. So our ability to operate in multicurrency, our ability to develop new industries, specific plug-in capabilities. And I think when we look at all of it, we feel that operating throughout the whole globe, it will be a tremendous growth opportunity for us. If you look at some of the wins we talked about in the world, whether it's in Mexico, OXXO or what we talk about in Brazil, like Caixa, these are dominant brands. We've talked before about MercadoLibre, I mean these are dominant brands that we're investing and they're investing with us. So I think there's tremendous organic opportunity. I do think that one of the great growth opportunities, some possible places that, over time, we deploy capital is outside the U.S. because inside the U.S., there's great opportunity and outside the U.S. So we know our way around the world. I'd say our regional businesses are very structured to be able to deliver. And we had bought ISV in Brazil Software Express, and that has provided tremendous capability for omnichannel and omnicommerce. So I think it's a great opportunity. We're fortunate to be blessed with our footprint and the leadership we have in the regions.

Good. All right. You mentioned Carat as well. Carat is your large enterprise-oriented omnichannel merchant-acquiring platform, your sort of what I think of as front door into Fiserv's capabilities globally that you launched within the last 6 months or so. What does Carat enable merchants to do that they couldn't do before? And do you have some example wins now on that platform?

Yes. Yes, yes, and yes. I think, first of all, what it really is, is an omnichannel differentiator. We've always had proven know-how in POS and unmatched scale. But here, we brought all of the capability together. We were always a great processor or I'd like to believe so. We were able to pivot to take those capabilities and our optimization capabilities and bring a technology stack to give a single entry point for our clients to allow us to be able to make it easy to operate throughout the world. One instance and using all the capabilities and then adding technology. And all of you say, hey, I think what you're saying is, hey, it all sounds very good, Frank. But could you give me some examples? I would talk about winning and implementing e-commerce, acquiring for clients such as Overstock.com in 3 months, Wingstop doing the same thing; expanding for clients such as Burger King, not only in the U.S. but outside the U.S. through a gateway capability and omnichannel. You heard us talk about State Farm and delivering new disbursement capabilities there. So beyond our clients, I think we get a lot of industry recognition that has been coming, whether it was Strawhecker just talking about us as omnichannel provider of choice of the year. So I think the momentum is built, you hear us talking about our e-comm wins, so those are large enterprise wins. That doesn't include everything we do through our gateways, through Clover. But Carat's been a standout. It was taking a bunch of parts that we had and then putting a technology stack with tremendous talent in front of it. And it wins in the client's office, and it gets implemented pretty quick and easy.

Right. Your other C, Clover, Clover is now, I think, has emerged in the last few years as one of the absolute flagship brands of Fiserv and grew GPV 25% in 2020, 34% last quarter. But in the context, as you said, of a now approaching $6 billion Merchant Acceptance business is still a relatively small piece of that. So how should investors think about the contribution of Clover to the whole Merchant Acceptance business? I mean, is it driving like you said, net new client adds? Is this retention, wallet share, how do you think of it over time, would your SMB franchise largely move to this platform? Like how do you think about how it sort of fits into the whole business?

Yes. I think Clover -- and I'm pretty darn proud of what we've done with Clover over time. And I think when we started on it, people thought that's interesting, but it probably actually has proved it's really, really, really very valuable. And the people that speak best about it are clients. So when clients love it, then you're doing the right thing. So let's think about, it's in 8 countries: U.S., U.K., Canada, Ireland, Germany, Austria, Argentina and the Netherlands. And so that will get further reach. We have strong results outside the U.S. We have great results inside the U.S. We veered into specific verticals. So it started out as a singular platform. We'll have vertical focus. I think when you think about the U.S. GPV numbers, it's about 1/4 of value of its GPV today and is increasing steadily. You should expect it to grow well outside the U.S. We are veering it into the ISV business, where it had participated nearly as much. Our partners believe it is a platform of choice. So I think our Merchant business is very -- it's Carat and Clover. And then it's distribution, and it's a winner in all aspects. So I think it will continue to drive growth and go back to the question about confidence. We have great confidence that Carat and Clover help drive us for the longer haul.

Well, Clover -- one addition on Clover now is Clover Connect, and you commented upfront about some of the recent adds on the ISV front. I would say when we talk to investors about Fiserv and about the Merchant Acceptance business, this is still probably the piece that not everyone is fully up to speed on, which is the level of investment that you've made on the ISV side fully realizing that, maybe, I don't know, 4 or 5 years ago, it might have been an area that you were a little bit underinvested in, but you've like worked really hard to kind of close that gap. So can you -- when I'm talking CardConnect, BluePay, more recently, Pineapple Payments and now all under the platform of Clover Connect, so just talk a little bit about this channel. One, contribution, growth and then also attractiveness relative to some of your other channels.

Yes. I think, first of all, you're pretty kind just probably 5 years ago, we were absent. And so I can't really remember when we bought CardConnect. I mean we had aspects about CardConnect, have rounded out BluePay on top of it. I think we did a fabulous job of integrating technically and organizationally BluePay and CardConnect, then allowing it to partner with Clover and begin a tight technical build. And that's how you begin to hear us talk about Clover Connect and the vision for what that will be late this year and for the future. And so this is market share gain, obviously, given the position we had. But when you bring all the assets together and our thoughts about how we, in fact, can cross-sell more of our product even into an ISV and help an ISV grow their business, is resonating in the client's office. And then I think your low length of an eye is the merchant. It's probably 2x a non-ISV merchant. So as we're adding that and you hear our growth rates, which are significant, we feel very good about the long-term durability of that revenue. And obviously, we are very focused on selling more than just the capability of what ISV might be like in for to bring more capability. And some of those are ACH,, interchange optimization, Clover Capital to add more value-added services. It's a fun place to be and operate. And I'm glad we have the assets inside the house and happy to bring Pineapple Payments in, which deals with a set of different verticals.

And just to follow up on this one. I know Fiserv works across all channels into SMBs and is quite strong in distribution generally. But when you look at buying behavior of SMBs, do you envision that they are more -- I mean, are you seeing that they are more structurally moving to buying their merchant acquiring services through their software provider? Is that secular shift like a durable shift or not so much?

I think there's continued growth there in a very -- at least what we see in a very strong fashion. Although I do see all these other partners generating a tremendous amount of leads, I think what to really think about is new business formation, which I think is going to be very powerful for the next year and change, there's going to be multiple channels with this new business formation occurs and our strategic positioning, whether it be banks, whether it be Verizon, Deluxe, Paychex, allows us to operate in a manner the SMB wants to operate. I think the answer is there will be more software in the SMB, and there will be continual verticalization focus. I think how a client comes to make their selection has a lot of different flavors. And the fact that we have deep partnerships with some of the best companies in their prospective space, whether it be Paychex, Verizon, Deluxe or ISV partners and our fabulous banks, I think, gives us a distribution advantage -- or actually know it gives us a distribution advantage. And then as you've asked before about, our continued investment in digital acquisition and how that's been taking hold. So for us, it's about where the client wants to be and where the client wants to act and how the client wants to operate, I think we have the ability to serve a million there.

Okay. One last one. I wanted to talk about the PayPal partnership. You just recently announced an expansion of the PayPal partnership to add PayPal Venmo acceptance at the POS. And of course, you have the [indiscernible] partnership with PayPal on the processing side. So how should investors think about this relationship and the contribution of the partnership to Fiserv's business?

Well, I think people should think of it as we have a great relationship. And when the opportunity to partner comes, we avail ourselves to it. And that may be a general tone inside the company about being a partner and treating everything like it's an opportunity. I think when you think about the QR code by itself, what we're really saying is we want to help our clients, the merchants, be able to operate commerce in a fashion they desire. And on Clover, the ability to do that will help our merchants. So we're in the business of helping our clients accept payments in any manner they want. I think the enabling of this will give us more capability, give our clients more capability, give them more payment options. And I think our merchants will also benefit from the Venmo social graph. So I would put it in the category of great partnership, taking care of our clients, enabling payments in different manners and being able to step in where the opportunity exists.

Got it. All right. Switching gears over to Financial Technology. Talk about this segment of your business, about 20% of revenues. Your medium-term guidance -- growth guidance for this business is in the 4% to 6% range. Talk a little bit about the growth drivers of the Financial Technology business and your competitive differentiation in this space.

Yes. I think we -- first of all, I love the business. It may have something to do that I hung around banking for a long time. So I think I have some understanding of what financial institutions want for cooler systems. And I think we are continuing to win in the market with new logos, which really becomes part of the growth story for us. Our digital banking solutions coming together also have won well. And obviously, that core is more than the core. It's what else it brings to the company. And that may show up in other segments as we cross-sell. But really, it's a strategic asset. It's a privileged position. Our organic account and digital adoption growth in our base really due to the mix we have, really shows tremendous trajectory, and we feel good about how that will perform to the rest of the year and as we had talked about in the medium term. And our delivery of APIs and open banking through third-party fintech marketplaces in banking-as-a-service offerings. And that really gets to us prepared to partner many times, us prepared to have a set of surround solutions out there and our ability to bring from the client lens what they're looking for. And sometimes it might be bringing other capabilities or just all of our capabilities. But when we look at 4% to 6%, we see that's the path forward, and we can feel very good about our confidence around that.

Okay. All right. Well, one topic that we've already heard a lot about today -- earlier today is the whole emergence of digital banks and fintechs that were, of course, around but through the last year have received a pretty big boost from the pandemic. So can you talk a bit about your Financial Technology business interacts with these fintechs, meaning do you consider them to be partners, customers, competitors? How do they fit into your ecosystem and your customer base of medium-sized banks in the Financial Technology business?

Well, I've always believed we're an enabler. We're a partner. So when I think about fintechs or digital banks, we want to lean in and help them go to where they want to. If you think about SoFi, we think about partner, we think about enable. We view these as growth opportunities, and we view our platform as an opportunity to bring more than just one element. It could be core banking, it could be digital, it could be merchant, it could be debit/credit, all those are capabilities that these digital brands are looking for. And for us, you'll hear us talk about signing them up and helping enable them. And on the other hand, we're bringing leading digital capabilities to our credit unions and our traditional banks, whether it be large, medium or community banks. So I view them as a friend and a partner and somebody who we have tremendous capability and scale. And as our clients grow, we help them grow. And so we feel good about our relationships.

All right. You recently bought Ondot -- acquired Ondot to add digital -- in the digital experience space. Can you talk about what Ondot adds to your core banking platform?

Yes. I think it's -- I think when we saw Ondot, we spent a lot of time. We were an early investor in Ondot and got to know the company well. Both companies, ironically, First Data and Fiserv, had fabulous relationships with Ondot. And our point of view was the digitization of cards is good, and they were the leader in it. But what we really aspire to do is give one digital instance for a banking client. So to be able to go to our credit unions, our community banks, our midsized or small banks and be able to provide them the capability that there's only one instance as simple as on a mobile phone for one of their clients, they could get their credit, their debit and their full banking information. And we think that's the journey we're on. We plan on capability being here within the next 12 months, probably closer to the fourth quarter. We're driving hard at the integration. But I think it will be a very differentiated mobile experience for the user. And ultimately, that means good for our banking partners.

All right. Let's switch to the third piece of Fiserv's business, the Payments and Networks business, other 40%. Here, medium-term growth guidance is in the 5% to 8% range, which is a pretty healthy growth rate. What gives you confidence in the growth outlook for this segment? What are the big drivers of Payments and Networks?

Yes. I mean we love these businesses. And I think, first of all, if you look at the wins we talked about around ADS, Genesis, Atlanticus, Spring Healthcare brand, First Horizon Bank. So that sales momentum you hear about us talking about, a lot of it showing up in Payments and Networks. And then I think you got to look at the secular growth going on, U.S. debit volumes, an expected rebound of credit and private-label accounts anticipated in the second half and going forward, those give us a nice tailwind. But I think the bigger is all the business we're onboarding. And then our ability, I think, which is fabulous in the network space. When we take STAR and Accel and put them together, we have this unique capability with our issuing and acquiring assets to do something. I think, very, very special for our clients. And that probably takes you further out than that medium term 5% to 8%, but also talks about some long-term sustainability of where those growth rates are after you onboard the new business and continue to help that grow.

All right. Well, one of my favorite pieces in Payments and Networks is the issuer processing business. You always referred to it as the wingman because it probably doesn't get the attention it deserves. But one of the really interesting elements of the Fiserv and First Data merger was bringing together this -- the leading debit processor with a leading credit processor under the same roof. Talk a little bit about the synergy that you see from having done that and where you're seeing a lot of growth and deals in that space.

Well, I think first of all, the team has done an incredible job. Because mergers can be difficult, and you have 2 networks, you have 2 businesses. But the team rallied around the client and the opportunity and the shareholder ultimately and fell on the synergies. I mean if you think about taking our Optus platform and offering it to community credit and smaller credit, our ability to grow that which is very, very large, and we were completely underpenetrated. And we see those wins completely at our back. The ability to put the 2 debit networks together and be able to create a much stronger offering to our clients both on the merchant and issuing side. So I mean this will have long-term growth opportunities for us. We will continue to invest in it. And I think what you see is just the ability to sell credit into our client base by itself, which was completely underpenetrated, is large, but the other abilities that we could do to help our clients grow through our debit network's very, very large.

We've seen in recent years some nontraditional card issuers kind of pop up in the issuer processing space, these would be like pure plays like a Marketo or some of the other acquirers, starting to do some of this. How do you think about -- I mean, do you even view -- are these players competitors with Fiserv or is non -- is like nonbank card issuance an area of priority for you?

Well, I think, first of all, we have a platform that operates globally, right? I mean you hear us talk about our global issuance platform. You've heard me say for a long time, we love competition. So I think it makes us better. I think it really does. I think as we began investing in our global reach and we thought about building out capabilities even on buy now, pay later, build out APIs, build out digital, really the acquisition of Ondot was about this experience to make the client -- the end client have a much better experience and beyond credit and debit but around the whole banking relationship. So I think it's our job to compete heavily. We invest heavily in these platforms. We know how to grow the businesses. We have demonstrated that. When you look at the wins we've had, I rattled off a couple before, but it's much larger than that. We got a bunch of next-gen issuers, like I talked about before, SoFi [indiscernible] and those guys. So our platform is definitely conducive to large issuers and start-ups. And it is about spending on that next-generation innovation, which really is in the client experience and us recognizing what the end client needs experientially.

All right. We're going to start turning to looking ahead, and I wanted to ask you a little bit about the investment areas. And actually, I'm weaving in one question that came in from the audience, which is, how has the acceleration in e-commerce and overall digital adoption or digital migration in the past year changed how you're thinking about investments? Like how is it -- how have you adjusted your investment priorities?

I think it might be less an adjustment of investment priorities and more an acceleration of investment priorities. I remember, I feel like it was this time last year. I may not have it exactly right, but it should like this, that we were rolling out our capability through Clover to order ahead, which was always on a roadmap, but boy, oh, boy, did it move at a speed appropriate for the world. So I'm not sure that everything can move at that speed forever. But I do find in times of disruption, and we've all had life disruption here, that innovation takes over. And the prioritization becomes easy because the market is demanding it. So I think we had a great acceleration. I think it's true on the banking side also. Although I see so much runway still for digital adoption for banking users. And I think that will be also probably a much shorter duration than we originally thought if we had macro digital adoption at a single-digit number in us thinking it should be a good double-digit number. Maybe we thought there was a 5-year time horizon, and now it's probably a 2-year time horizon. So I'm sure we shifted priorities. I'm positive of that for the here and now. I think we accelerated many things that were longer roadmaps. I do think it's digital all the time. And I think of omnichannel and e-comm as digital as much as I do payments. And I think what it really did was speed up our priority set. And I thought -- I mean in a crazy way, it actually caused us to be laser-focused in a way you would during a crisis to deliver.

All right. Well, at the time of the merger, Fiserv specifically earmarked $500 million for investments above and beyond investments, above and beyond what I'd call the business-as-usual level of investment for funding innovation and growth. Can you give -- now that we can take a breather, I think, a little bit, can you give some examples of where that $500 million is focused? And also weave into that kind of where your appetite and time horizon for additional M&A is either tuck-in or larger scale.

Yes. I think it's good. I mean that $500 million really was around helping our clients grow their business. And that would really, if you put a bow on it, put it in the digital nature, right, in the front of the house. And remember, Bob and I would get up and say the following -- I think that's what we said all the time was that $500 million was in that midterm model in the long term that we showed you of what we're going to produce, but there was nothing on the top line for it. So embedded in the spend but not on the top line. And so when you look at our spending around digital, around the client space, when you think about how we built out a lot of the capabilities in mobile, all really with clients coming to us and then us building it out. Obviously, we spent money on some acquisitions, but I want to really put -- even though -- I don't put that in what we were talking about there. What we were talking about is clearly spending more on technology innovation and scaling it to the client. So if you look at everything we did around digital client experience and our digital roadmap, that was an acceleration of what may have been 5 years into 2, and that was the deployment of some of this capital. Our appetite around M&A is specifically on assets -- like you see us buying Pineapple or Ondot is very, very large because we think we know how to -- I mean like -- I think this is probably a bold statement, but I think Ondot will have similar effects on our business as Clover has on the Merchant business as we integrate the single client experience in a manner that helps our banks. I think Pineapple will end up being great in different verticals for us and allow us to grow it at a much greater rate than it could have grown by itself and bring some of its capabilities across our whole client base. And I think we have a good track record on this. I think we have an appetite to be strategic in terms of acquisition and know that we could grow. We will invest in start-ups. And we will deploy as much capital to buying back shares as we have in the past. And if you look at the balance, we'll have a leverage ratio down and be able to deploy that delta between share buyback and acquisitions. So you should think of us as an acquirer.

All right. Okay. So we just have a few minutes left, so we're going to transition to some of our closing questions. We talked a lot about the individual medium-term performance goals or top line goals for the individual business units. But just kind of to tie a bow around the whole thing, how should investors think about the medium- to long-term financial performance from Fiserv, realizing, of course, this year's weird. We're lapping everything, all of that. But I just mean more on a steady-state basis, what should they expect from a top line EPS, cash-generation perspective?

Yes. I think -- I mean I'm very, very clear on this. I know you said this year will be odd. Last year was pretty odd too. I'm praying next year isn't odd. But all that time, I mean, granted, we had 0 revenue growth last year on an IRG basis, but we did actually generate double-digit EPS. And we've maintained quite a track record of that. So I think we're a high single-digit grower. I think we're a high single-digit grower. And that's a steady state and very, very committed to that at a minimum. I think you should think about us as a strong double-digit EPS, mid-teens EPS once we get past the lapping, all the opportunities we've captured here. And we will expand margins. We will expand margins. We've had good margin expansion. And the output of that will be a tremendous free cash flow. That will be -- we will stick to a tried and true benchmark of share buyback, but you should expect, as I talked before, a balanced approach and applying capital to acquisitions also. But the short answer, high single-digit grower, double-digit EPS grower, margin expander and good capital allocation methodology.

All right. Good. Well, for our wrap-up question then, why don't you just now -- for you personally, looking ahead, what in your view are -- we've talked a lot -- there's a lot of initiatives, a lot of -- across a lot of business units here, what are the initiatives and aspects of the Fiserv story that you're the most excited about and/or that you feel like are underappreciated within Fiserv?

Well, I'll spend a lot of time thinking about underappreciated, but I can tell you what I'm most excited about and maybe by some is underappreciated. I think the addressable market opportunities that we have, combined with the capabilities that we've already built and will continue to build, will allow us to continue to be a partner of choice in the FI space. I think the FI space has unlimited opportunity for us. And I always like to believe that I have a good understanding of the size, small and large. I think the merchant space has unlimited opportunity. And so I think it's very easy to feel excited about innovating and creating and building while having a tremendously accretive set of assets here. If you think about those guidance numbers we kind of talked about and what you should expect, that's while continuing to grow, continuing to invest and continuing to innovate. So I just think -- I think our client set is off-the-charts good and continues to get there. Our technology is industry-leading, and our size and scale is unparalleled really. So I think it's hard to do anything but be tremendously excited. And also tremendously respectful of our clients and investors because our client base is the best, and our objective is to work for our shareholders. And I'm grateful for the opportunity.

Wonderful. Can't end at anything better than that. Thanks so much [indiscernible] thanks for joining us. Thrilled to have you...

Thanks for having me, Lisa.

And can't wait to finally be in person...

We'll see each other soon. Thanks.

All right. Have a great day. Thank you.

All right. You, too.