AI Takeaway
FIS delivered strong Q1 FY2026 revenue growth of 30.1% to $3.30B, while net income surged to $2.37B—a near 30x increase year-over-year—driven largely by a non-recurring gain, even as margins compressed slightly and long-term debt jumped 54.8% following a major acquisition.
Revenue
$3.29B
++30.13% YoY
EPS (Basic)
$4.59
++2960.00% YoY
Gross Margin
33.6%
-1.09% YoY
Operating Income
$423M
++21.90% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-Q filing
FIS reported Q1 FY2026 revenue of $3.30B, up 30.1% year-over-year from $2.53B, suggesting significant business expansion, likely from an acquisition or reintegration of a previously divested segment, as organic growth alone rarely produces such a step-change.
Source: Source: 10-Q Income Statement, Q1 FY2026
Net income reached $2.37B in Q1 FY2026 versus $77M in the prior-year period—a 2,972.7% increase—resulting in a net margin of 71.8%, which is far above the operating margin of 12.8% and strongly implies a large one-time non-operating gain (e.g., a divestiture gain or asset sale) rather than operational improvement.
Source: Source: 10-Q Income Statement, Q1 FY2026
Gross margin declined modestly to 33.6% from 34.7%, and operating margin fell to 12.8% from 13.7%, as cost of revenue grew faster (32.3%) than revenue (30.1%), indicating some dilution from newly consolidated lower-margin business or integration costs.
Source: Source: 10-Q Income Statement & Key Ratios, Q1 FY2026
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Upgrade to unlockLong-term debt rose 54.8% year-over-year to $16.9B, significantly increasing FIS's financial leverage with a debt-to-equity ratio of 1.72. This elevated debt load increases interest expense burden and reduces financial flexibility, particularly if integration of the acquired business underperforms or macroeconomic conditions deteriorate.
Source: Source: 10-Q Balance Sheet, Q1 FY2026
Unlock 4 more detailed risk analysis
Upgrade to unlockReported EPS of $1.36 versus the $1.30 analyst consensus — a +4.6% beat for Q1 FY2026.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $3.29B | $2.53B | +30.13% |
Cost of Revenue | $2.19B | $1.65B | +32.30% |
Gross Profit | $1.11B | $879M | +26.05% |
Operating Income | $423M | $347M | +21.90% |
Net Income | $2.37B | $77M | +2972.73% |
EPS (Basic) | $4.59 | $0.15 | +2960.00% |
EPS (Diluted) | $4.58 | $0.15 | +2953.33% |
SG&A Expense | $605M | $558M | +8.42% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $43.48B | $32.84B | +32.41% |
Current Assets | $4.98B | $4.41B | +12.95% |
Total Liabilities | $27.5B | $17.77B | +54.75% |
Current Liabilities | $8.47B | $6.95B | +21.81% |
Stockholders' Equity | $15.98B | $15.06B | +6.06% |
Cash & Equivalents | $755M | $805M | -6.21% |
Long-Term Debt | $16.89B | $10.91B | +54.80% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Investing Cash Flow | $-8.17B | $-1.68B | -387.53% |
Financing Cash Flow | $7.65B | $-265M | +2988.30% |
Share Buybacks | $67M | $537M | -87.52% |
D&A | $628M | $456M | +37.72% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Gross Margin | 33.6% | 34.7% | -1.09% |
Operating Margin | 12.8% | 13.7% | -0.87% |
Net Margin | 71.8% | — | — |
ROE | 14.8% | — | — |
ROA | 5.4% | — | — |
Current Ratio | $0.588 | — | — |
Debt to Equity | $1.721 | — | — |
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FIS reported net income of $2.37B in Q1 FY2026, up from just $77M a year ago—a nearly 30-fold increase. This surge is almost certainly attributable to a large one-time non-operating gain (such as a divestiture or asset sale) rather than core business improvement, as operating income was only $423M and the net margin of 71.8% far exceeds the operating margin of 12.8%.
FIS's revenue grew 30.1% year-over-year to $3.30B in Q1 FY2026, up from $2.53B in the prior-year period. This step-change in revenue is consistent with the consolidation of a newly acquired business, as organic growth alone rarely produces such a large single-quarter increase.
While the filing text was not available, the financial data strongly implies a major acquisition closed in Q1 FY2026: investing cash outflows surged to -$8.17B (from -$1.68B), long-term debt jumped 54.8% to $16.9B, and financing cash flow turned sharply positive at $7.65B. These patterns are consistent with a large debt-financed acquisition being completed during the quarter.
FIS's financial health shows mixed signals: while revenue and net income grew dramatically, the current ratio of just 0.59 indicates short-term liabilities ($8.47B) far exceed short-term assets ($4.98B), and the debt-to-equity ratio rose to 1.72 as long-term debt surged to $16.9B. The elevated leverage and liquidity gap are key areas for investors to monitor as FIS integrates its newly acquired business.
FIS's margins declined modestly in Q1 FY2026 despite strong revenue growth: gross margin fell to 33.6% from 34.7%, and operating margin dropped to 12.8% from 13.7% in the prior year. The compression reflects cost of revenue growing faster (32.3%) than revenue (30.1%), likely due to the dilutive impact of newly consolidated lower-margin operations.