UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________________________

Form 10-Q

_______________________________________________

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023

Or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 001-16427

_______________________________________________

Fidelity National Information Services, Inc.

(Exact name of registrant as specified in its charter)

Georgia		37-1490331
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
347 Riverside Avenue
Jacksonville	Florida	32202
(Address of principal executive offices)		(Zip Code)

(904) 438-6000

(Registrant’s telephone number, including area code)

(Former Name or Former Address, if Changed Since Last Report)

Securities registered pursuant to Section 12(b) of the Act:
	Trading	Name of each exchange
Title of each class	Symbol(s)	on which registered
Common Stock, par value $0.01 per share	FIS	New York Stock Exchange
0.750% Senior Notes due 2023	FIS23A	New York Stock Exchange
1.100% Senior Notes due 2024	FIS24A	New York Stock Exchange
0.625% Senior Notes due 2025	FIS25B	New York Stock Exchange
1.500% Senior Notes due 2027	FIS27	New York Stock Exchange
1.000% Senior Notes due 2028	FIS28	New York Stock Exchange
2.250% Senior Notes due 2029	FIS29	New York Stock Exchange
2.000% Senior Notes due 2030	FIS30	New York Stock Exchange
3.360% Senior Notes due 2031	FIS31	New York Stock Exchange
2.950% Senior Notes due 2039	FIS39	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) YES ☐ NO ☒

As of April 28, 2023, 592,436,518 shares of the Registrant’s Common Stock were outstanding.

FORM 10-Q

QUARTERLY REPORT

Quarter Ended March 31, 2023

INDEX

	Page
Part I: FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets	2
Condensed Consolidated Statements of Earnings	3
Condensed Consolidated Statements of Comprehensive Earnings (Loss)	4
Condensed Consolidated Statements of Equity	5
Condensed Consolidated Statements of Cash Flows	6
Notes to Condensed Consolidated Financial Statements	7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3. Quantitative and Qualitative Disclosure About Market Risks	29
Item 4. Controls and Procedures	31
Part II: OTHER INFORMATION
Item 1A. Risk Factors	31
Item 6. Exhibits	32
Signatures	34

1

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(In millions, except per share amounts)

(Unaudited)

	March 31, 2023		December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	1,871	$	2,188
Settlement assets	4,425		5,855
Trade receivables, net of allowance for credit losses of $92 and $75, respectively	3,476		3,699
Other receivables	486		493
Prepaid expenses and other current assets	708		583
Total current assets	10,966		12,818
Property and equipment, net	838		862
Goodwill	34,424		34,276
Intangible assets, net	8,531		8,956
Software, net	3,222		3,238
Other noncurrent assets	1,988		2,048
Deferred contract costs, net	1,109		1,080
Total assets	$	61,078	$	63,278
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND EQUITY
Current liabilities:
Accounts payable, accrued and other liabilities	$	2,465	$	2,754
Settlement payables	5,331		6,752
Deferred revenue	825		788
Short-term borrowings	3,968		3,797
Current portion of long-term debt	2,139		2,133
Total current liabilities	14,728		16,224
Long-term debt, excluding current portion	13,905		14,207
Deferred income taxes	3,494		3,550
Other noncurrent liabilities	1,847		1,891
Total liabilities	33,974		35,872
Redeemable noncontrolling interest	—		180
Equity:
FIS stockholders’ equity:
Preferred stock $0.01 par value; 200 shares authorized, none issued and outstanding as of March 31, 2023, and December 31, 2022	—		—
Common stock $0.01 par value, 750 shares authorized, 631 and 630 shares issued as of March 31, 2023, and December 31, 2022, respectively	6		6
Additional paid in capital	46,802		46,735
(Accumulated deficit) retained earnings	(15,141)		(14,971)
Accumulated other comprehensive earnings (loss)	(364)		(360)
Treasury stock, $0.01 par value, 39 and 39 common shares as of March 31, 2023, and December 31, 2022, respectively, at cost	(4,206)		(4,192)
Total FIS stockholders’ equity	27,097		27,218
Noncontrolling interest	7		8
Total equity	27,104		27,226
Total liabilities, redeemable noncontrolling interest and equity	$	61,078	$	63,278

See accompanying notes, which are an integral part of these unaudited condensed consolidated financial statements.

2

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Earnings

(In millions, except per share amounts)

(Unaudited)

	Three months ended March 31,
	2023		2022
Revenue	$	3,510	$	3,492
Cost of revenue	2,169		2,242
Gross profit	1,341		1,250
Selling, general, and administrative expenses	1,004		1,035
Asset impairments	—		58
Operating income	337		157
Other income (expense):
Interest expense, net	(137)		(43)
Other income (expense), net	(11)		61
Total other income (expense), net	(148)		18
Earnings before income taxes	189		175
Provision (benefit) for income taxes	48		54
Net earnings	141		121
Net (earnings) loss attributable to noncontrolling interest	(1)		(1)
Net earnings attributable to FIS common stockholders	$	140	$	120
Net earnings per share-basic attributable to FIS common stockholders	$	0.24	$	0.20
Weighted average shares outstanding-basic	592		610
Net earnings per share-diluted attributable to FIS common stockholders	$	0.24	$	0.20
Weighted average shares outstanding-diluted	593		614

See accompanying notes, which are an integral part of these unaudited condensed consolidated financial statements.

3

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Earnings (Loss)

(In millions)

(Unaudited)

	Three months ended March 31,
	2023				2022
Net earnings (loss)			$	141			$	121
Other comprehensive earnings (loss), before tax:
Foreign currency translation adjustments	$	257			$	(495)
Change in fair value of net investment hedges	(296)				351
Other adjustments	—				4
Other comprehensive earnings (loss), before tax	(39)				(140)
Provision for income tax (expense) benefit related to items of other comprehensive earnings (loss)	35				(6)
Other comprehensive earnings (loss), net of tax	$	(4)	(4)		$	(146)	(146)
Comprehensive earnings (loss)			137				(25)
Net (earnings) loss attributable to noncontrolling interest			(1)				(1)
Comprehensive earnings (loss) attributable to FIS common stockholders			$	136			$	(26)

See accompanying notes, which are an integral part of these unaudited condensed consolidated financial statements.

4

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Equity

Three months ended March 31, 2023 and 2022

(In millions, except per share amounts)

(Unaudited)

			Amount
			FIS Stockholders
									Accumulated
	Number of shares				Additional				other
	Common	Treasury	Common		paid in		Retained		comprehensive		Treasury		Noncontrolling		Total
	shares	shares	stock		capital		earnings		earnings (loss)		stock		interest (1)		equity
Balances, December 31, 2022	630	(39)	$	6	$	46,735	$	(14,971)	$	(360)	$	(4,192)	$	8	$	27,226
Issuance of restricted stock	1	—	—		—		—		—		—		—		—
Exercise of stock options	—	—	—		40		—		—		—		—		40
Treasury shares held for taxes due upon exercise of stock awards	—	—	—		—		—		—		(14)		—		(14)
Stock-based compensation	—	—	—		20		—		—		—		—		20
Cash dividends declared ($0.52 per share per quarter) and other distributions	—	—	—		—		(310)		—		—		(2)		(312)
Other	—	—	—		7		—		—		—		—		7
Net earnings (loss)	—	—	—		—		140		—		—		1		141
Other comprehensive earnings (loss), net of tax	—	—	—		—		—		(4)		—		—		(4)
Balances, March 31, 2023	631	(39)	$	6	$	46,802	$	(15,141)	$	(364)	$	(4,206)	$	7	$	27,104

			Amount
			FIS Stockholders
									Accumulated
	Number of shares				Additional				other
	Common	Treasury	Common		paid in		Retained		comprehensive		Treasury		Noncontrolling		Total
	shares	shares	stock		capital		earnings		earnings (loss)		stock		interest (1)		equity
Balances, Decmber 31, 2021	625	(16)	$	6	$	46,466	$	2,889	$	252	$	(2,266)	$	11	$	47,358
Issuance of restricted stock	3	—	—		5		—		—		—		—		5
Exercise of stock options	—	—	—		8		—		—		—		—		8
Treasury shares held for taxes due upon exercise of stock awards	—	(1)	—		—		—		—		(77)		—		(77)
Stock-based compensation	—	—	—		57		—		—		—		—		57
Cash dividends declared ($0.47 per share per quarter) and other distributions	—	—	—		—		(288)		—		—		(2)		(290)
Net earnings (loss)	—	—	—		—		120		—		—		1		121
Other comprehensive earnings (loss), net of tax	—	—	—		—		—		(146)		—		—		(146)
Balances, March 31, 2022	628	(17)	$	6	$	46,536	$	2,721	$	106	$	(2,343)	$	10	$	47,036

(1)Excludes redeemable noncontrolling interest that is not considered equity.

See accompanying notes, which are an integral part of these unaudited condensed consolidated financial statements.

5

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(In millions)

(Unaudited)

	Three months ended March 31,
	2023		2022
Cash flows from operating activities:
Net earnings	$	141	$	121
Adjustment to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization	895		1,013
Amortization of debt issuance costs	8		7
Asset impairments	—		58
Stock-based compensation	20		57
Deferred income taxes	(41)		(112)
Net changes in assets and liabilities, net of effects from acquisitions and foreign currency:
Trade and other receivables	214		62
Settlement activity	(189)		(162)
Prepaid expenses and other assets	(153)		(152)
Deferred contract costs	(118)		(73)
Deferred revenue	61		55
Accounts payable, accrued liabilities and other liabilities	(206)		22
Net cash provided by operating activities	632		896
Cash flows from investing activities:
Additions to property and equipment	(48)		(108)
Additions to software	(231)		(304)
Settlement of net investment hedge cross-currency interest rate swaps	(10)		135
Other investing activities, net	(4)		(13)
Net cash provided by (used in) investing activities	(293)		(290)
Cash flows from financing activities:
Borrowings	20,233		15,902
Repayment of borrowings and other financing obligations	(20,582)		(16,609)
Debt issuance costs	(2)		—
Net proceeds from stock issued under stock-based compensation plans	47		33
Treasury stock activity	(14)		(77)
Dividends paid	(309)		(287)
Payments on tax receivable agreement	(94)		(46)
Purchase of noncontrolling interest	(173)		—
Other financing activities, net	(2)		(1)
Net cash provided by (used in) financing activities	(896)		(1,085)
Effect of foreign currency exchange rate changes on cash	86		(103)
Net increase (decrease) in cash, cash equivalents and restricted cash	(471)		(582)
Cash, cash equivalents and restricted cash, beginning of period	4,813		4,283
Cash, cash equivalents and restricted cash, end of period	$	4,342	$	3,701
Supplemental cash flow information:
Cash paid for interest	$	176	$	75
Cash paid for income taxes	$	57	$	46

See accompanying notes, which are an integral part of these unaudited condensed consolidated financial statements.

6

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Unless stated otherwise or the context otherwise requires, all references to "FIS," "we," "our," "us," the "Company" or the "registrant" are to Fidelity National Information Services, Inc., a Georgia corporation, and its subsidiaries.

(1)       Basis of Presentation

The unaudited financial information included in this report includes the accounts of FIS and its subsidiaries prepared in accordance with U.S. generally accepted accounting principles and the instructions to Form 10-Q and Article 10 of Regulation S-X. All adjustments considered necessary for a fair presentation have been included. This report should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2022.

The preparation of these consolidated financial statements in conformity with United States ("U.S.") generally accepted accounting principles ("GAAP") and the related rules and regulations of the U.S. Securities and Exchange Commission ("SEC" or "Commission") requires our management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reported periods. The inputs into management's critical and significant accounting estimates consider the economic impact of higher rates of inflation and slower economic growth. These estimates may change as new events occur and additional information is obtained. Future actual results could differ materially from these estimates. To the extent that there are differences between these estimates, judgments and assumptions and actual results, our consolidated financial statements will be affected.

Certain reclassifications have been made in the 2022 consolidated financial statements to conform to the classifications used in 2023. On the consolidated statements of comprehensive earnings, we reclassified the Change in fair value of net investment hedges from Foreign currency translation adjustments into its own classification. On the consolidated statements of cash flows, we reclassified Settlement of net investment hedges cross-currency interest rate swaps from Other investing activities to its own classification and Payments on tax receivable agreement from Other financing activities into its own classification.

FIS reports its financial performance based on the following segments: Banking Solutions, Merchant Solutions, Capital Market Solutions, and Corporate and Other. The Company regularly assesses its portfolio of assets and reclassified certain businesses from Capital Market Solutions to Banking Solutions and to the Corporate and Other Segment in the quarter ended March 31, 2023, and recast all prior-period segment information presented. See Note 10 for more information regarding our segments and the related reclassification.

Amounts in tables in the financial statements and accompanying footnotes may not sum or calculate due to rounding.

(2)       Acquisitions

Virtus Acquisition

On January 2, 2020, FIS acquired a majority interest in Virtus Partners ("Virtus"), previously a privately held company that provides high-value managed services and technology to the credit and loan market. The acquisition was accounted for as a business combination. FIS acquired a 70% voting and financial interest in Virtus with 30% interest retained by the founders of Virtus ("Founders"). The agreement between FIS and the Founders provided FIS with a call option to purchase, and the Founders with a put option requiring FIS to purchase, all of the Founders' retained interest in Virtus at a redemption value determined pursuant to performance goals stated in the agreement, exercisable at any time after two years and three years, respectively, following the acquisition date. In January 2023, the Founders exercised their put option, and as a result, FIS paid the $173 million redemption value, recorded as a financing activity in the consolidated statement of cash flows, and now owns 100% of Virtus.

(3)       Revenue

Disaggregation of Revenue

In the following tables, revenue is disaggregated by primary geographical market and type of revenue. The tables also include a reconciliation of the disaggregated revenue with the Company's reportable segments. Prior-period amounts have been reclassified to conform to the new reportable segment presentation as discussed in Note 10.

7

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the three months ended March 31, 2023 (in millions):

					Capital
	Banking		Merchant		Market		Corporate
	Solutions		Solutions		Solutions		and Other		Total
Primary Geographical Markets:
North America	$	1,439	$	777	$	425	$	26	$	2,667
All others	246		328		238		31		843
Total	$	1,685	$	1,105	$	663	$	57	$	3,510
Type of Revenue:
Recurring revenue:
Transaction processing and services	$	1,299	$	1,081	$	342	$	39	$	2,761
Software maintenance	90		1		129		—		220
Other recurring	54		20		19		10		103
Total recurring	1,443		1,102		490		49		3,084
Software license	11		3		73		—		87
Professional services	154		—		100		2		256
Other non-recurring fees	77		—		—		6		83
Total	$	1,685	$	1,105	$	663	$	57	$	3,510

For the three months ended March 31, 2022 (in millions):

					Capital
	Banking		Merchant		Market		Corporate
	Solutions		Solutions		Solutions		and Other		Total
Primary Geographical Markets:
North America	$	1,418	$	785	$	374	$	51	$	2,628
All others	241		327		253		43		864
Total	$	1,659	$	1,112	$	627	$	94	$	3,492
Type of Revenue:
Recurring revenue:
Transaction processing and services	$	1,255	$	1,087	$	308	$	76	$	2,726
Software maintenance	92		1		125		—		218
Other recurring	51		22		14		10		97
Total recurring	1,398		1,110		447		86		3,041
Software license	31		1		73		—		105
Professional services	144		—		107		2		253
Other non-recurring fees	86		1		—		6		93
Total	$	1,659	$	1,112	$	627	$	94	$	3,492

8

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Contract Balances

The Company recognized revenue of $318 million and $310 million during the three months ended March 31, 2023 and 2022, respectively, that was included in the corresponding deferred revenue balance at the beginning of the periods.

Transaction Price Allocated to the Remaining Performance Obligations

As of March 31, 2023, approximately $22.5 billion of revenue is estimated to be recognized in the future primarily from the Banking Solutions and Capital Market Solutions segments' remaining unfulfilled performance obligations, which are primarily comprised of recurring account- and volume-based processing services. This excludes the amount of anticipated recurring renewals not yet contractually obligated. The Company expects to recognize approximately 30% of the Banking Solutions and Capital Market Solutions segments' remaining performance obligations over the next 12 months, approximately another 22% over the next 13 to 24 months, and the balance thereafter.

As permitted by ASC 606, Revenue from Contracts with Customers, the Company has elected to exclude from this disclosure an estimate for the Merchant Solutions segment, as its contracts either have an original duration of one year or less or contain variable consideration that is allocated entirely to the day of performance under its stand-ready performance obligations comprised of a series of distinct daily services. The aggregate fixed consideration portion of customer contracts with an initial contract duration greater than one year is not material.

(4)       Condensed Consolidated Financial Statement Details

Cash and Cash Equivalents

The Company records restricted cash in captions other than Cash and cash equivalents in the consolidated balance sheets. The reconciliation between Cash and cash equivalents in the consolidated balance sheets and Cash, cash equivalents and restricted cash per the consolidated statements of cash flows is as follows (in millions):

	March 31, 2023		December 31, 2022
Cash and cash equivalents on the consolidated balance sheets	$	1,871	$	2,188
Merchant float (in Settlement assets)	2,471		2,625
Total Cash and cash equivalents and restricted cash per the consolidated statements of cash flows	$	4,342	$	4,813

Settlement Assets

The principal components of the Company's settlement assets on the consolidated balance sheets are as follows (in millions):

	March 31, 2023		December 31, 2022
Settlement assets
Settlement deposits	$	527	$	492
Merchant float	2,471		2,625
Settlement receivables	1,427		2,738
Total Settlement assets	$	4,425	$	5,855

9

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Intangible Assets, Software and Property and Equipment

The following table provides details of Intangible assets, Software and Property and equipment as of March 31, 2023, and December 31, 2022 (in millions):

	March 31, 2023						December 31, 2022
	Cost		Accumulated depreciation and amortization		Net		Cost		Accumulated depreciation and amortization		Net
Intangible assets	$	18,362	$	9,831	$	8,531	$	18,260	$	9,304	$	8,956
Software	$	6,635	$	3,413	$	3,222	$	6,607	$	3,369	$	3,238
Property and equipment	$	2,394	$	1,556	$	838	$	2,381	$	1,519	$	862

As of March 31, 2023, Intangible assets, net of amortization, includes $8,305 million of customer relationships and $226 million of trademarks and other intangible assets. Amortization expense with respect to Intangible assets was $496 million and $557 million for the three months ended March 31, 2023 and 2022, respectively.

Depreciation expense for property and equipment was $57 million and $73 million for the three months ended March 31, 2023 and 2022, respectively.

Amortization expense with respect to software was $251 million and $287 million for the three months ended March 31, 2023 and 2022, respectively. During the three months ended March 31, 2023 and 2022, the Company recorded $16 million and $62 million, respectively, of incremental software amortization expense resulting from the Company's platform modernization. Platform modernization includes sunsetting certain technology platforms, which resulted in shortened estimated useful lives and accelerated amortization methods primarily impacting the associated assets over approximately three years, beginning in the third quarter of 2021.

Impairments

For the three months ended March 31, 2022, the Company also recorded $58 million of impairments primarily related to real estate-related assets as a result of office space reductions.

Goodwill

Changes in goodwill during the three months ended March 31, 2023, are summarized below (in millions). Prior-period amounts have been reclassified to conform to the new reportable segment presentation as discussed in Note 10.

					Capital		Corporate
	Banking		Merchant		Market		And
	Solutions		Solutions		Solutions		Other		Total
Balance, December 31, 2022	$	12,536	$	17,460	$	4,260	$	20	$	34,276
Foreign currency adjustments	8		123		17		—		148
Balance, March 31, 2023	$	12,544	$	17,583	$	4,277	$	20	$	34,424

We assess goodwill for impairment on an annual basis during the fourth quarter or more frequently if circumstances indicate potential impairment. We evaluated if events and circumstances as of March 31, 2023, indicated potential impairment of our reporting units. We performed a qualitative assessment by examining factors most likely to affect our reporting units' fair values, including the impact of recent U.S. bank failures. The factors examined involve significant use of management judgment and included, among others, (1) forecast revenue, growth rates, operating margins, and capital expenditures used to calculate estimated future cash flows, (2) future economic and market conditions and (3) FIS' market capitalization. Based on our interim impairment assessment as of March 31, 2023, we concluded that it remained more likely than not that the fair value continues to exceed the carrying amount for each of our reporting units; therefore, goodwill was not impaired.

It is reasonably possible, however, that macroeconomic conditions, including rates of economic growth, inflation and interest, and foreign currency movements, or other events could have a material impact on one or more of the estimates and assumptions used to evaluate goodwill impairment and could result in future goodwill impairment.

10

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

The total carrying amount of goodwill as of March 31, 2023, and December 31, 2022, is net of accumulated impairment charges of $17.7 billion. Of this amount, $17.6 billion relates to the Merchant Solutions reporting unit which was impaired during the fourth quarter of 2022, and $94 million relates to non-strategic businesses within Corporate and Other which were impaired during the fourth quarter of 2020.

Visa Europe and Contingent Value Rights

As part of the Worldpay acquisition, the Company acquired certain assets and liabilities related to the June 2016 Worldpay Group plc (Legacy Worldpay) disposal of its ownership interest in Visa Europe to Visa Inc. As part of the disposal, Legacy Worldpay received proceeds from Visa Inc. in the form of cash ("cash consideration") and convertible preferred stock ("preferred stock"), the value of which may be reduced by losses incurred relating to ongoing interchange-related litigation involving Visa Europe. The preferred stock becomes convertible into Visa Inc. Class A common stock ("common stock") in stages as determined by Visa Inc. in accordance with the relevant transaction documents pertaining to the aforementioned disposal of the Visa Europe ownership interest. The preferred stock becomes fully convertible no later than 2028 (subject to a holdback to cover any pending claims). Also in connection with the disposal and pursuant to the terms of an amendment executed on September 17, 2020, the Company will pay the former Legacy Worldpay owners 90% of the net-of-tax proceeds from the disposal, known as contingent value rights, which is recorded as a liability ("CVR liability") on the consolidated balance sheets.

The Company has elected the fair value option under ASC 825, Financial Instruments ("ASC 825"), for measuring its preferred stock asset and CVR liability. The fair value of the preferred stock was $71 million and $55 million at March 31, 2023, and December 31, 2022, respectively, recorded in Other noncurrent assets on the consolidated balance sheets. The fair value of the CVR liability was $361 million and $342 million at March 31, 2023, and December 31, 2022, respectively, recorded in Other noncurrent liabilities on the consolidated balance sheets. Pursuant to ASC 825, the Company remeasures the fair value of the preferred stock and CVR liability each reporting period. The net change in fair value was $(3) million and $25 million for the three months ended March 31, 2023 and 2022, respectively, recorded in Other income (expense), net on the consolidated statements of earnings (loss).

Equity Security Investments

The Company holds various equity securities without readily determinable fair values that primarily represent strategic investments made by the Company as well as investments obtained through acquisitions. Such investments totaled $395 million and $393 million at March 31, 2023, and December 31, 2022, respectively, and are included within Other noncurrent assets on the consolidated balance sheets. The Company accounts for these investments at cost, less impairment, and adjusts the carrying values for observable price changes from orderly transactions for identical or similar investments of the same issuer. These adjustments are generally considered Level 2-type fair value measurements. The Company records gains and losses on these investments, realized and unrealized as well as impairment losses, as Other income (expense), net on the consolidated statements of earnings (loss) and recorded net gains of $(2) million and $41 million for the three months ended March 31, 2023 and 2022, respectively, related to these investments.

(5)       Deferred Contract Costs

Origination and fulfillment costs from contracts with customers capitalized as of March 31, 2023, and December 31, 2022, consisted of the following (in millions):

	March 31, 2023		December 31, 2022
Contract costs on implementations in progress	$	216	$	250
Contract origination costs on completed implementations, net	636		579
Contract fulfillment costs on completed implementations, net	257		251
Total Deferred contract costs, net	$	1,109	$	1,080

Amortization of deferred contract costs on completed implementations was $91 million and $96 million during the three months ended March 31, 2023 and 2022, respectively.

11

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

The Company recorded $3 million and $16 million during the three months ended March 31, 2023 and 2022, respectively, of incremental amortization expense related to deferred contract costs resulting from the Company's platform modernization.

(6)       Debt

Long-term debt as of March 31, 2023, and December 31, 2022, consisted of the following (in millions):

	March 31, 2023
		Weighted
		Average
	Interest	Interest		March 31,		December 31,
	Rates	Rate (1)	Maturities	2023		2022
Fixed Rate Notes
Senior USD Notes	0.6% - 5.6%	3.9%	2024 - 2052	$	8,659	$	9,409
Senior Euro Notes	0.6% - 3.0%	1.6%	2023 - 2039	6,256		6,154
Senior GBP Notes	2.3% - 3.4%	6.6%	2029 - 2031	1,144		1,119
Revolving Credit Facility (2)		6.0%	2026	556		280
Incremental Revolving Credit Facility (3)			2023	—		—
Other (4)				(571)		(622)
Total long-term debt, including current portion				16,044		16,340
Current portion of long-term debt				(2,139)		(2,133)
Long-term debt, excluding current portion				$	13,905	$	14,207

(1)The weighted average interest rate includes the impact of interest rate swaps and excludes the impact of cross-currency interest rate swaps (see Note 7).

(2)Interest on the Revolving Credit Facility is generally payable at LIBOR plus an applicable margin of up to 1.625% plus an unused commitment fee of up to 0.225%, each based upon the Company's corporate credit ratings. The weighted average interest rate on the Revolving Credit Facility excludes fees.

(3)Interest on the Incremental Revolving Credit Facility is generally payable at a rate, at the option of the Company, equal to the Term SOFR Rate plus 0.10% plus a margin of up to 1.625% or equal to the Base Rate plus a margin of up to 0.625%, in either case plus an unused commitment fee of up to 0.225%.

(4)Other includes financing obligations for certain hardware and software, the fair value of interest rate swaps (see Note 7), unamortized non-cash bond discounts and unamortized debt issuance costs.

Short-term borrowings as of March 31, 2023, and December 31, 2022, consisted of the following (in millions):

	March 31, 2023
	Weighted
	Average
	Interest			March 31,		December 31,
	Rate		Maturities	2023		2022
Euro-commercial paper notes ("ECP Notes")	3.0	%	Up to 183 days	$	1,924	$	2,054
U.S. commercial paper notes ("USCP Notes")	5.4	%	Up to 397 days	2,044		1,701
Other				—		42
Total Short-term borrowings				$	3,968	$	3,797

As discussed further in Note 7, the Company is a party to interest rate swaps that convert a portion of its fixed-rate debt to variable-rate debt. These interest rate swaps are designated as fair value hedges of its fixed rate debt. The Company has also entered into cross currency interest rate swaps under which it agrees to pay interest in U.S. dollars in exchange for receiving interest in a foreign currency. Although these cross currency interest rate swaps are entered into as net investment hedges of its investments in certain of its non-U.S. subsidiaries, and not for the purpose of hedging interest rates, the benefit or cost of such hedges is reflected in interest expense in the consolidated statement of earnings. As of March 31, 2023, the weighted average interest rate of the Company's outstanding debt was 3.7%, including the impact of interest rate swaps but excluding the impact of cross-currency interest rate swaps. Including the impact of cross-currency interest rate swaps on interest expense, the weighted average interest rate of the Company's outstanding debt was 3.0%.

12

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

The following summarizes the aggregate maturities of our long-term debt, including other financing obligations for certain hardware and software, based on stated contractual maturities, excluding the fair value of the interest rate swaps (see Note 7) and net unamortized non-cash bond discounts of $(552) million as of March 31, 2023 (in millions):

	Total
2023 remaining period	$	1,392
2024	1,311
2025	1,448
2026	1,261
2027	2,416
Thereafter	8,865
Total principal payments	16,693
Debt issuance costs, net of accumulated amortization	(97)
Total long-term debt	$	16,596

There are no mandatory principal payments on the Revolving Credit Facility or the Incremental Revolving Credit Facility, and any balance outstanding on the Revolving Credit Facility or the Incremental Revolving Credit Facility will be due and payable at each such facility's scheduled maturity date, which occur on March 2, 2026 and December 15, 2023, respectively.

Senior Notes

On March 1, 2023, FIS repaid an aggregate principal amount of $750 million in Senior USD Notes, on their due date, pursuant to the related indenture.

On December 3, 2022, FIS repaid an aggregate principal amount of €1.0 billion in Senior Euro Notes, on their due date, pursuant to the related indenture.

On July 13, 2022, FIS completed the issuance and sale of Senior USD Notes with an aggregate principal amount of $2.5 billion with interest rates ranging from 4.5% to 5.6% and maturities ranging from 2025 to 2052. The proceeds from the debt issuance were used for the repayment of debt under our commercial paper programs in the third quarter of 2022.

Revolving Credit Facilities

On February 28, 2023, FIS entered into a Incremental Revolving Credit Facility which provides credit commitments outstanding of $