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 June 30, 2024

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
0.625% 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 August 2, 2024, 545,565,929 shares of the Registrant's Common Stock were outstanding.

FORM 10-Q

QUARTERLY REPORT

Quarter Ended June 30, 2024

INDEX

	Page
Part I: FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets	2
Condensed Consolidated Statements of Earnings (Loss)	3
Condensed Consolidated Statements of Comprehensive Earnings (Loss)	4
Condensed Consolidated Statements of Equity	5
Condensed Consolidated Statements of Cash Flows	7
Notes to Condensed Consolidated Financial Statements	8
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	31
Item 3. Quantitative and Qualitative Disclosure About Market Risks	41
Item 4. Controls and Procedures	42
Part II: OTHER INFORMATION
Item 1A. Risk Factors	42
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	42
Item 5. Other Information	42
Item 6. Exhibits	42
Signatures	45

1

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(In millions, except per share amounts)

(Unaudited)

	June 30, 2024		December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	2,131	$	440
Settlement assets	530		617
Trade receivables, net of allowance for credit losses of $41 and $31, respectively	1,675		1,730
Other receivables	337		287
Receivable from related party	169		—
Prepaid expenses and other current assets	612		603
Current assets held for sale	997		10,111
Total current assets	6,451		13,788
Property and equipment, net	645		695
Goodwill	16,979		16,971
Intangible assets, net	1,508		1,823
Software, net	2,178		2,115
Equity method investment	4,086		—
Other noncurrent assets	1,591		1,528
Deferred contract costs, net	1,143		1,076
Noncurrent assets held for sale	17		17,109
Total assets	$	34,598	$	55,105
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable, accrued and other liabilities	$	1,854	$	1,859
Settlement payables	541		635
Deferred revenue	864		832
Short-term borrowings	—		4,760
Current portion of long-term debt	578		1,348
Current liabilities held for sale	949		8,884
Total current liabilities	4,786		18,318
Long-term debt, excluding current portion	10,584		12,970
Deferred income taxes	833		2,179
Other noncurrent liabilities	1,354		1,446
Noncurrent liabilities held for sale	—		1,093
Total liabilities	17,557		36,006
Equity:
FIS stockholders' equity:
Preferred stock $0.01 par value; 200 shares authorized, none issued and outstanding as of June 30, 2024, and December 31, 2023	—		—
Common stock $0.01 par value, 750 shares authorized, 633 and 631 shares issued as of June 30, 2024, and December 31, 2023, respectively	6		6
Additional paid in capital	47,024		46,935
(Accumulated deficit) retained earnings	(22,304)		(22,864)
Accumulated other comprehensive earnings (loss)	(413)		(260)
Treasury stock, $0.01 par value, 84 and 48 common shares as of June 30, 2024, and December 31, 2023, respectively, at cost	(7,276)		(4,724)
Total FIS stockholders' equity	17,037		19,093
Noncontrolling interest	4		6
Total equity	17,041		19,099
Total liabilities and equity	$	34,598	$	55,105

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 (Loss)

(In millions, except per share amounts)

(Unaudited)

	Three months ended June 30,				Six months ended June 30,
	2024		2023		2024		2023
Revenue	$	2,489	$	2,424	$	4,957	$	4,821
Cost of revenue	1,538		1,519		3,091		3,086
Gross profit	951		905		1,866		1,735
Selling, general, and administrative expenses	609		553		1,182		1,073
Asset impairments	4		1		18		1
Other operating (income) expense, net - related party	(40)		—		(73)		—
Operating income (loss)	378		351		739		661
Other income (expense):
Interest expense, net	(43)		(160)		(120)		(302)
Other income (expense), net	(13)		(77)		(167)		(113)
Total other income (expense), net	(56)		(237)		(287)		(415)
Earnings (loss) before income taxes and equity method investment earnings (loss)	322		114		452		246
Provision (benefit) for income taxes	89		29		116		65
Equity method investment earnings (loss), net of tax	10		—		(76)		—
Net earnings (loss) from continuing operations	243		85		260		181
Earnings (loss) from discontinued operations, net of tax	1		(6,679)		709		(6,634)
Net earnings (loss)	244		(6,594)		969		(6,453)
Net (earnings) loss attributable to noncontrolling interest from continuing operations	(1)		(1)		(1)		(1)
Net (earnings) loss attributable to noncontrolling interest from discontinued operations	—		(1)		—		(2)
Net earnings (loss) attributable to FIS common stockholders	$	243	$	(6,596)	$	968	$	(6,456)
Net earnings (loss) attributable to FIS:
Continuing operations	$	242	$	84	$	259	$	180
Discontinued operations	1		(6,680)		709		(6,636)
Total	$	243	$	(6,596)	$	968	$	(6,456)
Basic earnings (loss) per common share attributable to FIS:
Continuing operations	$	0.44	$	0.14	$	0.46	$	0.30
Discontinued operations	—		(11.28)		1.25		(11.21)
Total	$	0.44	$	(11.14)	$	1.71	$	(10.91)
Diluted earnings (loss) per common share attributable to FIS:
Continuing operations	$	0.43	$	0.14	$	0.46	$	0.30
Discontinued operations	—		(11.28)		1.25		(11.21)
Total	$	0.44	$	(11.14)	$	1.71	$	(10.91)
Weighted average common shares outstanding:
Basic	554		592		565		592
Diluted	557		592		567		592

Amounts in table may not sum or calculate due to rounding.

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 June 30,				Six months ended June 30,
	2024		2023		2024		2023
Net earnings (loss)	$	244	$	(6,594)	$	969	$	(6,453)
Other comprehensive earnings (loss), before tax:
Foreign currency translation adjustments	(15)		182		(151)		439
Change in fair value of net investment hedges	72		(125)		232		(421)
Excluded components of fair value hedges	(24)		(23)		(29)		(23)
Reclassification of foreign currency translation adjustments to net earnings (loss) from discontinued operations	—		—		(148)		—
Share of equity method investment other comprehensive earnings (loss)	(3)		—		—		—
Other adjustments	1		1		(5)		1
Other comprehensive earnings (loss), before tax	31		35		(101)		(4)
Provision for income tax (expense) benefit related to items of other comprehensive earnings (loss)	(12)		(2)		(52)		33
Other comprehensive earnings (loss), net of tax	19		33		(153)		29
Comprehensive earnings (loss)	263		(6,561)		816		(6,424)
Net (earnings) loss attributable to noncontrolling interest	(1)		(2)		(1)		(3)
Comprehensive earnings (loss) attributable to FIS common stockholders	$	262	$	(6,563)	$	815	$	(6,427)

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 and six months ended June 30, 2024

(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		equity
Balances, March 31, 2024	632	(69)	$	6	$	46,968	$	(22,347)	$	(432)	$	(6,174)	$	4	$	18,025
Issuance of restricted stock	1	—	—		—		—		—		—		—		—
Purchases of treasury stock	—	(15)	—		—		—		—		(1,082)		—		(1,082)
Treasury shares held for taxes due upon exercise of stock awards	—	—	—		—		—		—		(20)		—		(20)
Stock-based compensation	—	—	—		56		—		—		—		—		56
Cash dividends declared ($0.36 per share per quarter) and other distributions	—	—	—		—		(200)		—		—		(1)		(201)
Sale of Worldpay noncontrolling interest	—	—	—		—		—		—		—		—		—
Net earnings (loss)	—	—	—		—		243		—		—		1		244
Other comprehensive earnings (loss), net of tax	—	—	—		—		—		19		—		—		19
Balances, June 30, 2024	633	(84)	$	6	$	47,024	$	(22,304)	$	(413)	$	(7,276)	$	4	$	17,041

			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		equity
Balances, December 31, 2023	631	(48)	$	6	$	46,935	$	(22,864)	$	(260)	$	(4,724)	$	6	$	19,099
Issuance of restricted stock	2	—	—		—		—		—		—		—		—
Exercise of stock options	—	—	—		1		—		—		—		—		1
Purchases of treasury stock	—	(36)	—		—		—		—		(2,501)		—		(2,501)
Treasury shares held for taxes due upon exercise of stock awards	—	—	—		—		—		—		(51)		—		(51)
Stock-based compensation	—	—	—		88		—		—		—		—		88
Cash dividends declared ($0.36 per share per quarter) and other distributions	—	—	—		—		(408)		—		—		(1)		(409)
Sale of Worldpay noncontrolling interest	—	—	—		—		—		—		—		(2)		(2)
Net earnings (loss)	—	—	—		—		968		—		—		1		969
Other comprehensive earnings (loss), net of tax	—	—	—		—		—		(153)		—		—		(153)
Balances, June 30, 2024	633	(84)	$	6	$	47,024	$	(22,304)	$	(413)	$	(7,276)	$	4	$	17,041

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 Equity

Three and six months ended June 30, 2023

(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		equity
Balances, March 31, 2023	631	(39)	$	6	$	46,802	$	(15,141)	$	(364)	$	(4,206)	$	7	$	27,104
Treasury shares held for taxes due upon exercise of stock awards	—	—	—		—		—		—		(1)		—		(1)
Stock-based compensation	—	—	—		44		—		—		—		—		44
Cash dividends declared ($0.52 per share per quarter) and other distributions	—	—	—		—		(311)		—		—		(2)		(313)
Net earnings (loss)	—	—	—		—		(6,596)		—		—		2		(6,594)
Other comprehensive earnings (loss), net of tax	—	—	—		—		—		33		—		—		33
Balances, June 30, 2023	631	(39)	$	6	$	46,846	$	(22,048)	$	(331)	$	(4,207)	$	7	$	20,273

			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	—	—	—		—		—		—		(15)		—		(15)
Stock-based compensation	—	—	—		64		—		—		—		—		64
Cash dividends declared ($0.52 per share per quarter) and other distributions	—	—	—		—		(621)		—		—		(4)		(625)
Other	—	—	—		7		—		—		—		—		7
Net earnings (loss)	—	—	—		—		(6,456)		—		—		3		(6,453)
Other comprehensive earnings (loss), net of tax	—	—	—		—		—		29		—		—		29
Balances, June 30, 2023	631	(39)	$	6	$	46,846	$	(22,048)	$	(331)	$	(4,207)	$	7	$	20,273

(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.

6

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows - (Unaudited) (In millions)

	Six months ended June 30,
	2024		2023
Cash flows from operating activities:
Net earnings (loss)	$	969	$	(6,453)
Less earnings (loss) from discontinued operations, net of tax	709		(6,634)
Net earnings (loss) from continuing operations	260		181
Adjustment to reconcile net earnings (loss) from continuing operations to net cash provided by operating activities:
Depreciation and amortization	859		888
Amortization of debt issuance costs	11		15
Asset impairments	18		1
Loss on extinguishment of debt	174		—
Loss (gain) on sale of businesses, investments and other	32		(2)
Stock-based compensation	87		49
Loss from equity method investment	76		—
Deferred income taxes	(118)		(118)
Net changes in assets and liabilities, net of effects from acquisitions and foreign currency:
Trade and other receivables	124		152
Receivable from related party	(169)		—
Settlement activity	(3)		1
Prepaid expenses and other assets	(116)		(126)
Deferred contract costs	(234)		(185)
Deferred revenue	(6)		(13)
Accounts payable, accrued liabilities and other liabilities	(243)		(76)
Net cash provided by operating activities from continuing operations	752		767
Cash flows from investing activities:
Additions to property and equipment	(43)		(66)
Additions to software	(342)		(305)
Settlement of net investment hedge cross-currency interest rate swaps	(8)		(17)
Net proceeds from sale of businesses and investments	12,796		—
Cash divested from sale of business	(3,137)		—
Acquisitions, net of cash acquired	(56)		—
Other investing activities, net	(42)		(28)
Net cash provided by (used in) investing activities	9,168		(416)
Cash flows from financing activities from continuing operations:
Borrowings	13,441		43,749
Repayment of borrowings and other financing obligations	(21,396)		(44,496)
Debt issuance costs	—		(2)
Net proceeds from stock issued under stock-based compensation plans	1		40
Treasury stock activity	(2,522)		(15)
Dividends paid	(409)		(618)
Purchase of noncontrolling interest	—		(173)
Other financing activities, net	40		(7)
Net cash provided by (used in) financing activities from continuing operations	(10,845)		(1,522)
Discontinued operations
Net cash provided by (used in) operating activities	(345)		952
Net cash provided by (used in) investing activities	(39)		(175)
Net cash provided by (used in) financing activities	(65)		(175)
Net cash provided by (used in) discontinued operations	(449)		602
Effect of foreign currency exchange rate changes on cash from continuing operations	(19)		22
Effect of foreign currency exchange rate changes on cash from discontinued operations	(26)		95
Net increase (decrease) in cash, cash equivalents and restricted cash	(1,419)		(452)
Cash, cash equivalents and restricted cash, beginning of period	4,414		4,813
Cash, cash equivalents and restricted cash, end of period	$	2,995	$	4,361
Supplemental cash flow information:
Cash paid for interest	$	324	$	396
Cash paid for income taxes	$	335	$	269

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

7

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, 2023.

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 inflation and economic growth rates. 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.

On January 31, 2024, the Company completed the previously announced sale ("the Worldpay Sale") of a 55% equity interest in its Worldpay Merchant Solutions business to private equity funds managed by GTCR, LLC (such funds, the "Buyer"). FIS retains a non-controlling 45% ownership interest in a new standalone joint venture, Worldpay Holdco, LLC ("Worldpay"), following the closing of the Worldpay Sale. FIS' share of the net income (loss) of Worldpay is reported as equity method investment earnings (loss), net of tax. The net cash proceeds received by FIS, net of estimated closing adjustments and transaction costs, are presented as investing cash flows within continuing operations on the consolidated statement of cash flows. See Note 4 for information regarding the equity method investment earnings (loss), net of tax, for the period from February 1, 2024, through June 30, 2024.

During the third quarter of fiscal year 2023, the Company analyzed quantitative and qualitative factors relevant to the Worldpay Merchant Solutions disposal group in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 205-20 and determined that the accounting criteria to be classified as held for sale were met, when a definitive purchase agreement was signed. Accordingly, the assets and liabilities of the disposal group are presented separately on the consolidated balance sheets for all periods presented. In addition, the disposition represents a strategic shift that will have a major impact on the Company's operations and financial results. As a result, the operating results of the Worldpay Merchant Solutions business prior to the closing of the Worldpay Sale have been reflected as discontinued operations for all periods presented and, as such, have been excluded from continuing operations and segment results.

The Worldpay Merchant Solutions business included the former Merchant Solutions segment, in addition to a business previously included in the Corporate and Other segment, which have been reflected as discontinued operations for all periods presented. Accordingly, the Company no longer reports the Merchant Solutions segment; it now reports its financial performance based on the following segments: Banking Solutions ("Banking"), Capital Market Solutions ("Capital Markets") and Corporate and Other. As a result of its ongoing portfolio assessments, the Company reclassified certain non-strategic operations from Banking to Corporate and Other during the quarter ended December 31, 2023. The Company recast all prior-period segment information presented to reflect these reclassifications. See Note 13 for more information regarding our segments.

Certain reclassifications have been made in the 2023 consolidated financial statements to conform to the classifications used in 2024. The consolidated statements of cash flows for the six months ended June 30, 2024, are presented on a continuing operations basis, with summarized cash flows from discontinued operations for operating, investing and financing activities shown separately. The consolidated statement of cash flows for the six months ended June 30, 2023, has been reclassified to conform to the 2024 presentation.

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

8

FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(2)    Summary of Significant Accounting Policies

The Company adopted the following new significant accounting policy during 2024. See our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, for a complete summary of our significant accounting policies.

Equity Method Investment

The Company reports its investments in unconsolidated entities over whose operating and financial policies the Company has the ability to exercise significant influence, but not control, under the equity method of accounting. Equity method investments are initially recorded at cost and are included in Equity method investment on the consolidated balance sheet. Under this method of accounting, the Company's pro rata share of the investee's earnings or losses is reported in Equity method investment earnings (loss), net of tax, in the consolidated statement of earnings (loss). The Company also reports its investor-level tax impact relating to equity method investments as a component of Equity method investment earnings (loss) in the consolidated statement of earnings (loss). The Company monitors its investments for other-than-temporary impairment by considering factors such as current economic and market conditions and the operating performance of the investees and records reductions in carrying values when necessary. Equity method investees are considered related parties of the Company.

Distributions received from our equity method investments are recorded as reductions in the carrying value of such investments and are classified on the consolidated statement of cash flows pursuant to the cumulative earnings approach. Under this approach, the distributions should be classified as either a return on investment, which would be included in operating activities, or a return of investment, which would be included in investing activities. Any distributions received up to the amount of cumulative equity in earnings of the investee would be considered a return on investment and classified in operating activities. Any distributions in excess of cumulative equity in earnings of the investee would be considered a return of investment and classified in investing activities. Thus, to the extent our equity in earnings of the investee reflects cumulative losses, the distributions are considered a return of investment and classified in investing activities.

(3)    Discontinued Operations

Sale of Worldpay Merchant Solutions Business

As discussed in Note 1, the Company completed the Worldpay Sale on January 31, 2024. The results of the Worldpay Merchant Solutions business prior to the completion of the Worldpay Sale have been presented as discontinued operations. The assets and liabilities of our Worldpay Brazil and RealNet subsidiaries, the value of which was included as part of the Worldpay Sale, were not conveyed in the closing and are expected to be transferred as soon as all regulatory approvals have been received. These assets and liabilities continue to be reported as assets held for sale, and their related earnings (loss) are reported in Earnings (loss) from discontinued operations, net of tax on the consolidated statements of earnings (loss).

The following table represents a reconciliation of the major components of Earnings (loss) from discontinued operations, net of tax, presented in the consolidated statements of earnings (loss), reflecting activity for the three and six months ended June 30, 2024 (in millions). The Company's presentation of earnings (loss) from discontinued operations excludes general corporate overhead costs that were historically allocated to the Worldpay Merchant Solutions business. Additionally, beginning on July 5, 2023, the Company stopped amortization of long-lived assets held for sale in accordance with ASC 360.

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FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

	Three months ended June 30,				Six months ended June 30,
	2024		2023		2024		2023
Major components of earnings (loss) from discontinued operations before income taxes:
Revenue	$	4	$	1,322	$	406	$	2,435
Cost of revenue	(2)		(670)		(64)		(1,270)
Selling, general, and administrative expenses	—		(479)		(155)		(965)
Asset impairments	—		(6,840)		—		(6,840)
Interest income (expense), net	—		7		1		11
Other, net	(1)		23		(4)		48
Earnings (loss) from discontinued operations related to major components of pretax earnings (loss)	1		(6,637)		184		(6,581)
Loss on sale of disposal group	—		—		(466)		—
Earnings (loss) from discontinued operations	1		(6,637)		(282)		(6,581)
Provision (benefit) for income taxes	—		43		(991)		55
Earnings (loss) from discontinued operations, net of tax attributable to FIS	$	1	$	(6,680)	$	709	$	(6,636)

A loss on sale of disposal group of $466 million was recorded upon closing of the Worldpay Sale and reflects the impact of the excess of the carrying value of the disposal group over the estimated fair value less cost to sell. Upon closing of the Worldpay Sale, the Company also recorded a tax benefit of $991 million primarily from the write-off of U.S. deferred tax liabilities that were not transferred in the Worldpay Sale, net of the estimated U.S. tax cost that the Company expects to incur as a result of the Worldpay Sale. The estimated U.S. tax cost remains unchanged from the amount recorded as of March 31, 2024, based on available data and management determinations as of June 30, 2024. Post-closing selling price adjustments and completion of other purchase agreement provisions in connection with the Worldpay Sale could result in further adjustments to the loss on sale amount and the estimated U.S. tax cost.

The following table represents the major classes of assets and liabilities of the disposal group classified as held for sale presented in the consolidated balance sheets as of June 30, 2024, and December 31, 2023 (in millions). Assets held for sale are reported at the lower of their carrying value or fair value less cost to sell and are not depreciated or amortized.

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FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

	June 30, 2024		December 31, 2023
Major classes of assets included in discontinued operations:
Cash and cash equivalents	$	43	$	1,380
Settlement assets	951		6,727
Trade receivables, net of allowance for credit losses of $— and $52	3		1,843
Prepaid expenses and other current assets	—		161
Total current assets	997		10,111
Property and equipment, net	—		207
Goodwill	15		10,906
Intangible assets, net	—		5,971
Software, net	—		1,321
Other noncurrent assets	2		613
Total noncurrent assets	17		19,018
Less valuation allowance	—		(1,909)
Total assets of the disposal group classified as held for sale	$	1,014	$	27,220
Major classes of liabilities included in discontinued operations:
Accounts payable, accrued and other liabilities	$	3	$	998
Settlement payables (1)	946		7,821
Other current liabilities	—		65
Total current liabilities	949		8,884
Deferred income taxes	—		599
Other noncurrent liabilities	—		494
Total noncurrent liabilities	—		1,093
Total liabilities of the disposal group classified as held for sale	$	949	$	9,977

(1)As of June 30, 2024, Settlement payables includes $116 million due to Worldpay, which is a related party.

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FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Settlement Assets

The principal components of the Company's settlement assets of the disposal group are as follows (in millions):

	June 30, 2024		December 31, 2023
Settlement assets
Settlement deposits	$	—	$	56
Merchant float	821		2,594
Settlement receivables	130		4,077
Total Settlement assets	$	951	$	6,727

Held-for-sale Disposal Group Measurement

The net assets held for sale as of June 30, 2024, consisting of the net assets of our Worldpay Brazil and RealNet subsidiaries, are recorded at carrying value less cost to sell.

(4)    Equity Method Investment

As discussed in Note 1, the Company completed the Worldpay Sale on January 31, 2024, retaining a non-controlling ownership interest in Worldpay. We account for our remaining minority ownership in Worldpay using the equity method of accounting. As of June 30, 2024, we own 45% of Worldpay. This investment is reflected in Equity method investment on our June 30, 2024, consolidated balance sheet. During the five-month period from February 1, 2024, through June 30, 2024, the Company's share of the net income of Worldpay and our investor-level tax impact is reported as Equity method investment earnings (loss), net of tax, in the consolidated statement of earnings (loss). During the three months ended June 30, 2024, we received distributions of $29 million from Worldpay, which are recorded in Other investing activities, net on the consolidated statement of cash flows for the six months ended June 30, 2024.

Summary Worldpay financial information is as follows (in millions):

	Three months		Five months
	ended		ended
	June 30, 2024		June 30, 2024
Revenue	$	1,349	$	2,181
Gross profit	$	668	$	1,053
Earnings (loss) before income taxes	$	3	$	(227)
Net earnings (loss) attributable to Worldpay	$	(28)	$	(271)
FIS share of net earnings (loss) attributable to Worldpay, net of tax (1)	$	10	$	(76)

(1)For the three- and five-month periods ended June 30, 2024, this amount is net of $22 million and $45 million, respectively, of investor-level tax benefit.

Continuing Involvement with Discontinued Operations and Related-Party Transactions

In connection with the closing of the Worldpay Sale, the Company entered into a limited liability company operating agreement (the "LLCA") with respect to Worldpay, and a registration rights agreement with respect to the Company's retained equity interest in Worldpay. The LLCA provides that FIS has the right to appoint a minority of the board of managers of Worldpay and that FIS has customary consent and consultation rights with respect to certain material actions of Worldpay, in each case, subject to ownership stepdown thresholds. The LLCA contains, among other things, covenants and restrictions relating to other governance, liquidity and tax matters, including non-solicitation and noncompetition covenants, distribution mechanics, preemptive rights and follow-on equity funding commitments of the Buyer, and restrictions on transfer and associated tag-along and drag-along rights. Each of FIS and the Buyer will have the right to require Worldpay to consummate an initial public offering ("IPO") or sale transaction after the fourth anniversary of the closing, subject to certain return hurdles

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FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

and (in the case of an IPO) public float requirements, which requirements will fall away following the sixth anniversary of the closing.

We have continuing involvement with Worldpay, primarily through our remaining interest, an employee leasing agreement ("ELA"), a transition services agreement ("TSA"), and various other commercial agreements. Under the terms of the ELA, which was substantially completed by July 1, 2024, the Company leased certain employees to Worldpay in the United States, China, Colombia and South Korea. The compensation and benefit costs paid by the Company for the leased employees was billed to and reimbursed by Worldpay. Under the terms of the TSA, the Company is procuring certain third-party services on behalf of Worldpay and providing technology infrastructure, risk and security, accounting and various other corporate services to Worldpay for a period of up to 24 months after the closing, subject to a six-month extension, and Worldpay is providing various corporate services to the Company, allowing it to maintain access to certain resources transferred in the Worldpay Sale.

During the three- and five-month periods ended June 30, 2024, pass-through costs of $132 million and $247 million, respectively, were incurred under the ELA, and third-party pass-through costs of $36 million and $93 million, respectively, were incurred under the TSA, and were netted against the equal and offsetting reimbursement amounts due from Worldpay. Additionally, during the three- and five-month periods ended June 30, 2024, net TSA services income of $40 million and $73 million, respectively, was recognized in Other operating (income) expense, net - related party, with approximately two-thirds of the corresponding expense recorded in Cost of revenue and the remainder recorded in Selling, general and administrative expense in the consolidated statement of earnings (loss). Revenue earned during the three- and five-month periods ended June 30, 2024, from various commercial services provided to Worldpay was $32 million and $55 million respectively.

For the three- and five-month periods ended June 30, 2024, we collected net cash of $272 million and $411 million, respectively, related to the ELA, TSA and commercial agreements with Worldpay. As of June 30, 2024, we recorded a receivable of $169 million in Receivable from related party on the consolidated balance sheet in connection with the ELA, TSA and commercial agreements. Under the ELA, amounts are generally invoiced to Worldpay on the 15th of each month for the preceding and subsequent payroll periods and are payable by wire transfer within 10 days. As of June 30, 2024, $58 million included in our related-party receivable is offset by an equal amount of accrued employee-related liabilities recorded in Accounts payable, accrued and other liabilities on the consolidated balance sheet. Upon termination of the ELA, the amount of the accrued employee-related liabilities as of the date of termination will be assumed by Worldpay in satisfaction of the corresponding receivable. Under the TSA and commercial agreements, amounts are generally invoiced monthly in arrears and are payable by electronic transfer within 30 days of invoice. As of June 30, 2024, we recorded a settlement payable of $116 million in Current liabilities held for sale on the consolidated balance sheet for amounts to be settled from our RealNet subsidiary to Worldpay. The settlement payable by RealNet to Worldpay is generally paid to Worldpay's submerchants on behalf of Worldpay via ACH within five business days according to payment instructions provided by Worldpay. As of June 30, 2024, we also recorded other payables to Worldpay of $36 million in Accounts payable, accrued and other liabilities on the consolidated balance sheet. These amounts are generally payable within 30 days.

(5)    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 (the "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 subsequently owns 100% of Virtus.

(6)    Revenue

As a result of our ongoing portfolio assessments, the Company reclassified certain non-strategic operations from Banking to Corporate and Other during the quarter ended December 31, 2023. The Company recast all prior-period segment information presented to reflect these reclassifications.

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FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

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.

For the three months ended June 30, 2024 (in millions):

			Capital
	Banking		Market		Corporate
	Solutions		Solutions		and Other		Total
Primary Geographical Markets:
North America	$	1,470	$	452	$	23	$	1,945
All others	240		270		34		544
Total	$	1,710	$	722	$	57	$	2,489
Type of Revenue:
Recurring revenue:
Transaction processing and services	$	1,270	$	366	$	43	$	1,679
Software maintenance	90		143		1		234
Other recurring	68		22		9		99
Total recurring	1,428		531		53		2,012
Software license	37		91		—		128
Professional services	136		99		1		236
Other non-recurring fees	109		1		3		113
Total	$	1,710	$	722	$	57	$	2,489

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FIDELITY NATIONAL INFORMATION SERVICES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the three months ended June 30, 2023 (in millions):

			Capital
	Banking		Market		Corporate
	Solutions		Solutions		and Other		Total
Primary Geographical Markets:
North America	$	1,437	$	424	$	47	$	1,908
All others	229		248		39		516
Total	$	1,666	$	672	$	86	$	2,424
Type of Revenue:
Recurring revenue:
Transaction processing and services	$	1,235	$	346	$	65	$	1,646
Software maintenance	91		130		—		221
Other recurring	62		20		10		92
Total recurring	1,388		496		75		1,959
Software license	19		79		—		98
Professional services	156		97		2		255
Other non-recurring fees (1)	103		—		9		112
Total	$	1,666	$	672	$	86