Fiserv’s Revenue Breakdown Worldwide (2016-2023)

Processing and Services

This revenue is generated from account and transaction-based fees. Processing and services fees are charged for:

• Data processing
• Merchant transaction processing and acquiring
• Electronic billing and payment services
• Electronic funds transfer and debit/credit processing services
• Consulting and professional services
• Software maintenance for ongoing client support

This revenue is recognized in the period in which the specific service is performed. In case, the control of combined goods and services is not transferred, then they are not deemed distinct from other goods or services. Hence, in such a case the revenue would not be recognized until its transfer. Fiserv’s arrangements for processing and services typically consist of an obligation to provide specific services to their customers on a “when” and “if” needed basis. These services are typically provided under a fixed or declining price per unit, based on the volume of service. However, pricing for such services may also be based on minimum monthly usage fees. These fees are typically billed and paid monthly.

Processing and services revenue represents 82% of Fiserv’s total revenue in 2021. This revenue is most reflective of Fiserv’s business performance as a significant amount of its total operating profit is generated by these services. On a QoQ basis, this revenue increased by 1.3%. However, on a YoY basis, there was an increase of 8.1%. Moreover, on an overall basis since 2019, the revenue in each quarter has more than doubled from this vertical.  

Product

Product revenue is generated from software license and hardware (POS devices) as well as from print and card production sales.

• For software license agreements that are distinct, revenue is recognized upon delivery, assuming a contract is deemed to exist. Revenue for arrangements with customers that comprise significant customization, modification, or production of software such that it is not distinct is typically recognized over time, based upon efforts and labor hours.
• For hosted licensed software for the customer, a software element is considered present to the extent the customer has the contractual right to take possession of the software. 
• Fiserv also sells or leases hardware (POS devices) and other peripherals as part of its contracts with customers. This hardware typically comprises terminals or Clover devices. They do not manufacture hardware, rather they purchase hardware from third-party vendors and hold such hardware in inventory until purchased by a customer. The sales of hardware are accounted as a separate performance obligation and revenue is recognized at its standalone selling price when the customer obtains control of the hardware.

Product revenue represents 18% of Fiserv’s total revenue in 2021. On a QoQ basis, this revenue increased by 10.9%. Even on a YoY basis, there was a 20.9% increase in the revenue and overall has more than doubled since 2019.

About the Company

Fiserv, Inc. is a leading global provider of financial and payments services. They are publicly traded on the NASDAQ Global Select Market and part of the S&P 500 Index. They serve clients around the globe, including merchants, banks, credit unions, other financial institutions, and corporate clients. Fiserv helps its clients achieve best-in-class results through a commitment to innovation and excellence in areas including:

• Account processing and digital banking solutions
• Card issuer processing and network services
• Payments
• E-commerce
• Merchant acquiring and processing and,
• The Clover cloud-based POS and business management platform

They provide services globally having their geographic teams across various regions: the United States and Canada; Europe, Middle East, and Africa; Latin America; and the Asia Pacific.

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