Executive Summary / Key Takeaways

• Strategic Transformation Accelerates: Global Payments is undergoing a profound transformation, divesting its Issuer Solutions business and acquiring Worldpay to become a pure-play merchant solutions provider. This strategic pivot is expected to accelerate growth, enhance competitiveness, and drive significant value creation.
• Genius Platform Driving Merchant Growth: The Genius platform, a unified cloud-based POS solution, is a core technological differentiator, showing strong early momentum with over 90% of new sales to new customers, increased monthly recurring revenue, and expanding into enterprise and international markets.
• Robust Financial Performance & Outlook: The company delivered strong Q3 2025 results with accelerating revenue growth in Merchant Solutions, healthy margin expansion, and robust free cash flow generation. Management forecasts continued adjusted net revenue growth of 5-6% for FY2025, with adjusted EPS growth at the high end of 10-11% on a constant currency basis.
• Enhanced Capital Returns and Deleveraging: Global Payments is committed to returning substantial capital to shareholders, targeting $7.5 billion between 2025 and 2027, incremental to disposition proceeds. The company also achieved its 3x net leverage target earlier than anticipated and expects to delever to 3x within 18-24 months post-Worldpay acquisition.
• Unmatched Scale and AI-Powered Future: The combined Global Payments and Worldpay entity will process nearly $4 trillion in annual volume across 100 billion transactions, providing an unparalleled data set for AI-powered insights in fraud, inventory, pricing, and churn analytics, further solidifying its competitive moat.

A New Era for Global Payments: Pure-Play Merchant Powerhouse

Global Payments Inc. (NYSE:GPN) is charting a decisive course towards becoming a preeminent pure-play merchant solutions provider, a strategic evolution underscored by its ongoing transformation and the pivotal acquisition of Worldpay. With roots tracing back to 1967, the company has consistently adapted its business model, expanding globally through strategic acquisitions and joint ventures. This rich history has culminated in a focused strategy to unify its operations, leverage advanced technology, and amplify its market presence in the dynamic world of commerce enablement.

The payments industry is experiencing a profound shift towards embedded and digital-native environments, demanding innovative software and seamless solutions. Global Payments' strategy is squarely aligned with these trends, emphasizing a customer-centric approach across its three core merchant pillars: Point-of-Sale and Software Solutions, Integrated and Embedded Solutions, and Core Payments Solutions. This strategic clarity is designed to unlock greater value, drive sustainable growth, and solidify its position as the worldwide partner of choice for commerce solutions.

Technological Edge: Genius and the Orchestration Layer

At the heart of Global Payments' differentiation lies its proprietary technology, particularly the Genius platform and its advanced orchestration layer. Genius represents a significant technological leap, consolidating 16 disparate POS systems into a unified, cloud-based platform for restaurants and retail. This modular, configurable, scalable, and extensible architecture offers tangible benefits:

• Accelerated Sales and Adoption: Over 90% of Genius sales are to new customers, with new locations increasing by more than 20% year-over-year in Q3 2025. Monthly recurring revenue from new sales surged 75% from June to September 2025, and the average deal size more than doubled, demonstrating strong market resonance.
• Versatile Functionality: Genius supports multiple form factors, from mobile phone applications to specialized handheld devices, countertops, kiosks, and digital menu boards. It offers vertically targeted configurations for retail, restaurants, campuses, field services, professional services, and age-restricted businesses.
• Enterprise and Education Expansion: The platform expanded its feature set to support enterprise businesses in September 2025 and higher education institutions in October 2025. This includes unified commerce enablement for multi-location quick-serve and fast-casual restaurants, sports venues, and campus-wide payment acceptance.
• Global Reach: Following its U.S. launch, Genius has expanded to the U.K. and Austria, with Germany expected by year-end 2025, and further rollouts planned for Ireland, the Czech Republic, Spain, Romania, Poland, and Australia in early 2026. This global deployment leverages Global Payments' established local presence and distribution capabilities in these high-growth markets.

Complementing Genius is Global Payments' modern real-time processing and orchestration platform, acquired to streamline operations and accelerate product delivery. This technology enables a "single-in, single-out" customer and partner experience, leveraging modern API environments and AI assistance. It allows for seamless distribution of products across multiple platforms and geographies, insulating clients from underlying processing complexities while simplifying infrastructure. This approach has already facilitated the EVO integration, supporting new volume and client migration from legacy gateways with minimal disruption.

The company is also embracing artificial intelligence to enhance productivity and customer experiences. Its engineering teams have used AI to generate nearly 1 million lines of code, saving tens of thousands of hours and reducing defects, thereby accelerating testing and integration cycles. The future combination with Worldpay will create an unparalleled data set from nearly $4 trillion in annual volume and 100 billion transactions, enabling AI-powered insights for fraud tools, predictive inventory analysis, dynamic pricing models, and churn risk analytics delivered in real-time. This technological roadmap, focused on innovation and efficiency, is a critical component of Global Payments' competitive moat and its long-term growth strategy.

Financial Momentum and Strategic Repositioning

Global Payments' recent financial performance reflects the early successes of its transformation agenda. For the three months ended September 30, 2025, the company reported revenues of $2.01 billion, a modest increase from $2.00 billion in the prior year. Operating income saw a significant jump to $778.0 million from $442.7 million, driven in part by a $343.9 million gain on the sale of Heartland Payroll Solutions. This disposition, along with the sale of AdvancedMD, Inc. in December 2024, is part of a broader strategy to streamline the business and return capital to shareholders.

The Merchant Solutions segment, the future core of Global Payments, demonstrated strong underlying health. For Q3 2025, adjusted net revenue growth accelerated to 6% on a constant currency basis, excluding dispositions. Operating income for the segment increased to $749.99 million from $707.55 million year-over-year, with the operating margin expanding to 37.4% from 35.4%. This improvement was primarily due to cost reduction activities and the favorable impact of workforce alignment initiatives undertaken in 2024. The Integrated and Embedded Solutions service line was a notable growth driver, with revenues increasing 6.8% to $879.78 million in Q3 2025, as payments continue to transition to digital-native environments.

Liquidity remains robust, with cash and cash equivalents totaling $2.785 billion as of September 30, 2025.

The company's disciplined capital allocation strategy is evident in its share repurchase programs, having repurchased 13.17 million shares for $1.185 billion year-to-date 2025. Furthermore, Global Payments achieved its target of 2.9x adjusted net leverage by the end of Q3 2025, ahead of schedule. This strong financial position, coupled with expected cash flow improvements from the "One Big Beautiful Bill Act," underpins the company's commitment to return $7.5 billion in capital to shareholders between 2025 and 2027.

Competitive Landscape and Strategic Differentiation

Global Payments operates in a highly competitive payments industry, facing direct rivals such as Fiserv , Fidelity National Information Services (FIS), Visa , and Mastercard , as well as indirect threats from emerging fintechs. While larger players like Fiserv (FISV) and Visa often boast superior scale and broader operational footprints, Global Payments strategically differentiates itself through its software-driven solutions and customer-centric approach.

Global Payments' Genius platform provides a significant competitive edge, particularly in the SMB segment, offering a comprehensive and customizable POS solution that many competitors lack. This contrasts with network-centric players like Visa (V) and Mastercard (MA), whose primary strength lies in transaction processing infrastructure. In the integrated and embedded payments space, Global Payments is actively expanding its distribution channels, including a dedicated outside sales force, to increase its win rate in complex verticals like automotive and healthcare, where clients prefer face-to-face interaction. This approach provides a point of differentiation against rivals.

The upcoming acquisition of Worldpay is a game-changer for Global Payments' competitive positioning. Worldpay brings best-in-class e-commerce and enterprise capabilities, managed PayFac solutions, and a presence in attractive new geographies. This combination will create a complete commerce solutions platform with unmatched global scale, processing nearly $4 trillion in annual volume. This scale, combined with a unified orchestration layer, will enable Global Payments to compete effectively on price while differentiating on functionality and service. The company's strategy to immediately sell Genius and other software solutions into Worldpay's SMB base and leverage Worldpay's distribution channels, including its FI partnerships with over 6,000 branches, is expected to drive significant revenue synergies.

While some market observers have expressed skepticism regarding the integration of large acquisitions in the payments space, Global Payments' management emphasizes an "uncompromising plan" for aligning its operating model and fully unifying the businesses under a single brand. The company's ongoing transformation, which has streamlined its technology and operations, provides a strong foundation for a more successful integration than past industry attempts.

Outlook and Growth Catalysts

Global Payments maintains a confident outlook for 2025 and beyond, underpinned by its strategic transformation and the anticipated Worldpay acquisition. For the full year 2025, the company expects constant currency adjusted net revenue growth of 5% to 6%, excluding dispositions. Adjusted operating margin is projected to expand by more than 50 basis points, excluding dispositions, and adjusted earnings per share growth is anticipated to be at the high end of the 10% to 11% range on a constant currency basis. This guidance assumes a stable macroeconomic environment with resilient consumer spending.

The Worldpay acquisition, expected to close in Q1 2026, is a significant catalyst. Management projects the combined entity to accelerate revenue growth in 2026 and achieve high single-digit growth in 2027, with margin expansion of 100 to 200 basis points in both years. This is double the original target for standalone Global Payments. The transaction is expected to be accretive to adjusted EPS from day one, supporting mid-teens growth targets over the medium term. The company anticipates realizing at least $600 million in cost synergies and $200 million in revenue synergies within three years of closing.

Key growth drivers include the continued global rollout and adoption of the Genius platform, increased productivity from a revamped sales force (with 500 additional field sellers being recruited in North America), and the cross-selling opportunities arising from the combined Global Payments and Worldpay merchant base. Investments in AI-powered insights, developer experience, and B2B solutions are also expected to fuel long-term growth.

Risks and Considerations

Despite the compelling investment thesis, several risks warrant consideration. Macroeconomic uncertainty, including potential currency fluctuations, inflation, and rising interest rates, could impact consumer and business spending, thereby affecting transaction volumes and revenue growth. The ongoing transformation and the Worldpay integration, while promising, carry execution risks. Management acknowledges that "making a lot of change in our organization... is a little bit disruptive at times." The ability to successfully integrate Worldpay's operations and realize the projected synergies is crucial for the investment thesis.

Competitive pressures remain intense, with both established players and new fintech entrants vying for market share. While Global Payments aims to differentiate through technology and service, aggressive pricing strategies by rivals could impact profitability. Regulatory changes, such as the "One Big Beautiful Bill Act" in the U.S. and the OECD's Pillar Two initiative, introduce tax complexities that the company is evaluating for future impact.

Conclusion

Global Payments is at a transformative juncture, strategically shedding its Issuer Solutions business to emerge as a focused, scaled, and technologically advanced pure-play merchant solutions provider. The company's commitment to innovation, exemplified by the Genius platform and its embrace of AI, is foundational to its competitive strategy and ability to capture market share in an evolving payments landscape. Strong financial performance, coupled with a clear roadmap for margin expansion and robust free cash flow generation, underpins its aggressive capital return program.

The Worldpay acquisition is poised to be a powerful catalyst, significantly enhancing Global Payments' global scale, product breadth, and distribution capabilities. While integration risks and macroeconomic uncertainties persist, management's disciplined approach to transformation and integration, combined with a compelling outlook for accelerated growth and shareholder returns, positions Global Payments as a compelling investment opportunity. The company's ability to blend innovation with unmatched scale, delivering differentiated value to merchants worldwide, forms the core of its long-term value creation story.