Q2 2026 Global Payments Inc Earnings Call Transcript
Key Points
- Global Payments Inc (GPN) delivered strong second-quarter results with adjusted net revenue growing 4% on a normalized basis and adjusted EPS increasing 12%, demonstrating the durability of its business model despite external headwinds.
- The integration of Worldpay is progressing rapidly, with key milestones achieved including the completion of the operating model design, target architecture, and alignment of the commercial organization into three segments (SMB, Enterprise, Platforms).
- Genius, the company's flagship point-of-sale platform, is gaining strong traction with a 30% increase in new merchant locations per sales professional, a 25% sequential increase in bookings, and a 75% year-over-year increase in new customer yields.
- The Enterprise segment delivered 7% normalized revenue growth despite a 400 basis point headwind from the Middle East conflict, driven by strong card-not-present volume growth and a 10% increase in bookings year-to-date.
- The company returned approximately $550 million to shareholders in the quarter through buybacks, is more than halfway to its $2 billion capital return commitment for 2026, and remains on track to return $7.5 billion cumulatively by the end of 2027.
- Platforms segment revenue grew 7% with volume growth of 10%, driven by strong embedded payments performance and a 25% increase in value-added services revenue, highlighting the success of its diversification strategy.
- Global Payments Inc (GPN) lowered its full-year 2026 adjusted net revenue growth outlook to 4% to 5% from prior expectations, citing a persistent and larger-than-anticipated headwind from the Middle East conflict on its travel portfolio.
- The Middle East conflict created an approximately 100 basis point headwind to second-quarter revenue growth, and the company now assumes this impact will persist through the remainder of 2026, creating ongoing uncertainty.
- The Enterprise segment experienced a significant 400 basis point revenue growth headwind in the second quarter due to reduced travel volumes, particularly in the Middle East, impacting overall segment performance.
- The company's free cash flow conversion was only 75% in the second quarter, with adjustments declining by more than 70% sequentially, indicating that cash flow generation remains below its full-year target of over 90%.
- The SMB segment's revenue growth of 4% was partly constrained by softness in the UK market, which is experiencing macroeconomic challenges, and the segment's growth is expected to remain in the mid-single-digit range in the near term.
- The company's updated guidance reflects a more cautious outlook for the second half of 2026, with revenue growth expected to be around 4.5%, factoring in the ongoing Middle East conflict and a stronger US dollar, which could limit upside potential.
Ladies and gentlemen, thank you for standing by, and welcome to Global Payments second-quarter 2026 Earnings Conference Call. (Operator Instructions) As a reminder, today's conference will be recorded.
At this time, I would like to turn the conference over to your host, Senior Vice President, Investor Relations, Nate Rozof. Please go ahead.
Good morning. Welcome to Global Payments second-quarter 2026 conference call. Joining us today is our CEO, Cameron Bready; CFO, Josh Whipple, and COO, Bob Cortopassi. Some of the comments made during today's call will contain forward-looking statements. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied and we caution you not to place undue reliance upon them. They speak only as of the date of this call, and we undertake no obligation to update them.
In addition, we will be referring to non-GAAP financial measures. For a full reconciliation
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