Stock Analysis on Net
Stock Analysis on Net

Fiserv Inc. (NASDAQ:FISV)

This company has been moved to the archive! The financial data has not been updated since April 28, 2022.

Common-Size Income Statement

Fiserv Inc., common-size consolidated income statement

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12 months ended: Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Processing and services 82.01 82.24 84.16 85.44 84.85
Product 17.99 17.76 15.84 14.56 15.15
Revenue 100.00% 100.00% 100.00% 100.00% 100.00%
Cost of processing and services -37.50 -39.33 -39.42 -39.91 -40.22
Cost of product -12.60 -13.27 -12.69 -12.79 -12.87
Cost of revenue -50.09% -52.60% -52.12% -52.70% -53.09%
Gross profit 49.91% 47.40% 47.88% 47.30% 46.91%
Selling, general and administrative -35.81 -38.06 -32.24 -21.09 -20.19
Gain on sale of businesses 0.00 3.12 0.15 3.90 0.18
Operating income 14.10% 12.47% 15.79% 30.10% 26.90%
Interest expense -4.29 -4.82 -4.98 -3.31 -3.09
Interest income 0.02 0.05 0.33 0.07 0.02
Interest expense, net -4.27% -4.77% -4.64% -3.25% -3.07%
Debt financing activities 0.00 0.00 -0.46 -0.24 0.00
Other income (expense) 0.44 0.19 -0.06 0.09 0.02
Income from continuing operations before income taxes and income from investments in unconsolidated affiliates 10.27% 7.88% 10.63% 26.70% 23.84%
Income tax provision -2.24 -1.32 -1.94 -6.49 -2.77
Income from investments in unconsolidated affiliates 0.62 0.00 0.28 0.17 0.56
Income from continuing operations 8.65% 6.56% 8.97% 20.38% 21.63%
Income from discontinued operations, net of income taxes 0.00 0.00 0.00 0.00 0.25
Net income 8.65% 6.56% 8.97% 20.38% 21.88%
Net income attributable to noncontrolling interests and redeemable noncontrolling interests -0.43 -0.11 -0.21 0.00 0.00
Net income attributable to Fiserv, Inc. 8.22% 6.45% 8.77% 20.38% 21.88%

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

The common-size income statement reveals a transition in revenue composition and a significant contraction in net profit margins between 2017 and 2021. While gross profitability improved over the period, this gain was offset by a substantial increase in operating expenses, primarily within selling, general, and administrative costs.

Revenue Composition and Gross Margin
A gradual shift in the revenue mix is observed, with processing and services declining from 84.85% of revenue in 2017 to 82.01% in 2021, while product revenue increased from 15.15% to 17.99%. Concurrently, the cost of revenue decreased from 53.09% to 50.09%, resulting in an expansion of the gross profit margin from 46.91% in 2017 to 49.91% in 2021.
Operating Expense Trends
Selling, general, and administrative (SG&A) expenses exhibited a sharp upward trend, rising from 20.19% of revenue in 2017 to a peak of 38.06% in 2020, before slightly moderating to 35.81% in 2021. This increase in overhead significantly eroded operating efficiency; operating income as a percentage of revenue fell from 26.90% in 2017 to 14.10% in 2021, despite occasional contributions from the sale of businesses.
Financial Costs and Tax Impact
Net interest expenses increased from 3.07% of revenue in 2017 to a high of 4.77% in 2020, ending the period at 4.27% in 2021, indicating a higher relative burden of debt servicing. The income tax provision remained volatile, peaking at 6.49% in 2018 before declining to 2.24% by 2021.
Net Profitability
The cumulative effect of increased operating expenses and higher interest costs led to a marked decline in bottom-line profitability. Net income attributable to the company decreased from 21.88% of revenue in 2017 to 8.22% in 2021, representing a significant reduction in the percentage of each revenue dollar converted into net profit.

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