Fiserv: A Sticky Situation in ’26

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Now, Fiserv (FISV +2.01%) – a name that once sounded as solid as a bank vault door – has found itself in a bit of a pickle. For years, it was the king of the castle when it came to the gizmos and gadgets that keep banks ticking. One of just three main suppliers of the vital, whirring, clicking innards that power those institutions. Plus, they owned Clover, a point-of-sale contraption that was, for a time, growing faster than a beanstalk. But oh dear, things have taken a turn.

A truly dreadful third-quarter report sent the stock tumbling faster than a sack of potatoes down a hill. It’s down nearly half its value since then! A most unpleasant spectacle. So, let’s peek behind the curtain and see what’s gone wrong, and what might happen by 2026. It’s a story with a whiff of brimstone, if you ask me.

1. A Quarter That Went Splat

In the third quarter of 2025, Fiserv reported earnings that were, shall we say, rather…underwhelming. They were nearly 23% below what the clever money on Wall Street had predicted. Revenue? A full 8% short of the mark! It was like trying to fill a bathtub with a thimble.

But the real shocker was the sudden, drastic chopping of their full-year forecast. They’d previously promised a lovely 10% revenue growth and earnings of around $10.15 to $10.30. Then, poof! Suddenly, it was a measly 3.5% to 4% revenue growth and earnings of just $8.50 to $8.60. The analysts and investors were gobsmacked, and the stock took a right proper beating – down over 50%!

2. Clover’s Troubles and a Bank’s Slow Fade

The trouble seems to stem from two main sources: Clover, which appears to have been promised far more than it could deliver, and a banking business that’s looking a bit…tired. Like an old armchair with springs poking out.

Fiserv’s CEO, Mr. Lyons, admitted that fourth-quarter revenue would drop a full 10% because they stopped charging certain fees. Apparently, Clover’s customers were getting rather cross about being billed so much. A bit like squeezing water from a stone, you see. Reports suggest they felt rather…fleeced.

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And there’s whispers of something even more unpleasant. Some investors claim Fiserv’s management inflated Clover’s growth figures by “forcibly” moving customers onto the Clover system and then pretending these weren’t just existing customers. Fiserv, naturally, denies this, but the scent of something fishy lingers.

Meanwhile, Fiserv’s banking division saw revenue fall 7% year-over-year. It’s a well-known story: banks are stuck with ancient, clunky core processing technology that’s about as nimble as a hippopotamus. They’ve been putting off an upgrade for years, but it seems the day of reckoning is drawing near.

3. What Next for This Peculiar Company?

Fiserv seems to have realized it’s made a bit of a mess and has launched something called the “One Fiserv” action plan. It’s supposed to focus on customers and build on their strengths. A noble effort, perhaps. There have also been changes at the top, including a new CEO, Mr. Lyons, who only took the reins last year. A bit late to be rearranging the deck chairs, wouldn’t you say?

We’ll get a glimpse of how things are progressing when Fiserv reports its fourth-quarter earnings on February 10th. They’re also planning an investor day sometime in the first half of the year.

Clover isn’t a lost cause, and Fiserv still holds a strong position in core processing. But if they want to win back the trust of clients and shareholders, they’ll need to address their shortcomings and fend off new competition. It won’t be easy. This company is facing a sticky situation, and only time will tell if they can wriggle free.

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2026-01-22 22:52