by Matt Rej
Five major payment companies reported second-quarter earnings over the past week: Toast, Fiserv, FIS, Global Payments, and Block. And the results were all over the place.
So there isn’t one clean takeaway that processors are collectively thriving or struggling right now. But there is a broader trend that continues to show up on these earnings calls.
Payment companies want to own more of the customer relationship.
Core processing is just the starting point. These businesses want to earn more from software, VAS, lending, AI products, banking services, and other tools that can generate more revenue from the same customer.
Plenty of these do provide legitimate value for merchants. But the more services you buy from one provider, the more important it is to understand exactly what you’re paying for.
Key Takeaways From the Latest Processor Earnings
Here are some of the biggest merchant-focused takeaways:
- Toast added a record 9,500 locations and says Toast IQ is its fastest-growing product ever.
- Fiserv cuts its full-year outlook again, while Clover continues to outperform the company overall.
- Global Payments says new Genius customer yields increased 75% as merchants attach more products and services.
- Worldpay’s bank partners are expected to begin selling Genius in 4Q26.
- Square now has over 200+ active ISO partners.
- FIS says customers using products across banking, payments, and Capital Markets generate ~2x revenue of single-solution clients.
- AI continues shifting from an internal efficiency tool into another product that processors can sell.
Toast Continues Adding Merchants at Record Pace
Toast had another strong quarter.
- Revenue increased 23%
- GPV increased 22% to $60.7 billion
- Added record 9,500 net new locations
- Total locations now at 180,000+
- Fintech net take rate 59 bps (down from 61 bps last qtr)
- Toast raised its full-year fintech and subscription gross profit growth outlook to 23%-25%
Most of the new locations added are still coming from Toast’s core SMB and mid-market restaurants. But the company wants to push beyond traditional independent restaurants.
The call highlighted Best Western and TGI Fridays in the UK, while also signing its first two gas stations and processing fuel payments for the first time. And retail, enterprise, international, and sports/entertainment are all bigger parts of Toast’s total addressable market.
Toast IQ Grow is the Bigger Story
Leadership said that Toast IQ Grow (its AI-powered marketing product) is the fastest-growing product that they ever launched. And it’s on track to be the fastest product to reach $10 million in ARR.
Currently, Toast IQ Grow costs $499 and is marketed to help merchants with things ranging from digital ordering to customer segmentation, social media, and marketing campaigns. But the long-term strategy is much broader.
Toast eventually sees AI agents handling things like scheduling, payroll, bookkeeping, inventory management, phone answering, and other functions that restaurants frequently outsource.
That’s the key takeaway. Toast doesn’t just want to process your credit cards anymore. They want to become the platform running a much larger piece of your business.
Fiserv Cuts its Outlook Again
Fiserv was easily the weakest processor in this group. Which is not surprising, considering their CEO stepped down voluntarily during this quarter, part of the ever-shuffling leadership over the last couple of years.
Here are the numbers:
- Organic revenue dropped 5%
- Merchant Solutions organic revenue dropped 1%
- Financial Solutions organic revenue dropped 8%
- Adjusted operating margin fell to 31.%
- Clover GPV increased 9%
- Full-year organic revenue expected to be flat or down 1% (vs. previous 1%-3% growth outlook).
Takis Georgakopolous (new CEO) and the leadership team is reviewing Fiserv’s businesses, technology investments, and product portfolio while spending an additional $100 million in the second half of 2026 on infrastructure and cybersecurity.
And as usual, Clover itself is performing considerably better than the company’s broader numbers suggest.
Fiserv said Clover revenue increased 13% when excluding certain non-recurring items, while GPV increased 9% on a reported basis and 11% excluding a gateway conversion. VAS penetration is 25% (vs. 27% last quarter and 24% last year).
So Clover isn’t falling apart. But Fiserv isn’t generating enough growth company-wide.
What Should Fiserv Merchants Watch For?
I’ve previously pointed out Fiserv’s focus on increasing average revenue per customer. That remains true and something you need to keep an eye on.
While poor earnings don’t automatically mean another processor rate increase is coming, Fiserv is still under significant pressure to improve revenue and find more ways to grow what each customer is worth.
This can theoretically come from multiple levers. But rate increases are often the easiest to pull on. VAS is next.
So remember this when you see new products, fees, bundles, or pricing changes ahead. Don’t pay for stuff you don’t need, and don’t accept rate increases without a fight. You’re allowed to push back.
Global Payments Wants More Revenue From Each Genius Merchant
Global’s earnings were solid.
Adjusted net revenue increased 4% to $3.16 billion, while adjusted operating margins expanded 70 basis points to 42%. Though the company lowered its full-year adjusted net revenue growth outlook slightly, from 5% previously to 4%-5% now.
Leadership cited the conflict in the Middle East disrupting its portfolio of travel merchants for the revised guidance. So it’s not like there’s a core problem with anything.
The more interesting story from Global’s earnings call is tied to Genius. The number that stood out the most to me was that new Genius customer yields increased 75% year-over-year.
Additionally, new Genius locations increased over 50% YoY and over 20% since last quarter.
Global wants each merchant to generate more revenue by attaching additional products and services to their account. And the platform segments reinforces that strategy:
- Platform revenue increased 7%
- Platform volume increased 10%
- Embedded payments volume increased 15%
- VAS revenue increased over 25%
Global is also preparing to let Worldpay’s financial institution partners to start selling Genius in 4Q26, starting with 30 of its largest bank partners.
That’s a significant new distribution channel and one of the cleanest examples of how Global plans to extract full value from the Worldpay acquisition.
Square is Becoming More Like a Traditional Processor
Square has grown quite a bit in recent years, and the latest earnings call was a real eye opener.
Earnings aside (for now), Square now has over 200+ active ISO partners. And sellers joining through the ISO channel increased more than 150% during the quarter compared to the previous period.
Square built much of its business around easy online signups and direct merchant acquisition. But now it’s using the same type of independent sales organizations that have been part of traditional merchant acquiring for decades.
I think it’s an interesting paradox because we’re seeing the opposite happening elsewhere.
Traditional processors are building better software, and software-first companies are building ISO channels. So everyone is moving toward this middle ground.
Now for some of Block’s key numbers:
- Gross profit up 25%
- Square gross profit up 13%
- Square GPV increased 13%
- US GPV up 10%
- International GPV increased 25% on constant-currency basis
Block raised its full-year gross profit outlook to $12.51 billion, which represents 21% growth.
Additionally, leadership says that there’s been a willingness for merchants to pay for Block’s Managerbot. Though they aren’t prioritizing monetization here just yet.
It’s a similar trend we’ve seen from Toast, as another processor will use AI as a product they can sell directly to merchants. Square is still figuring out whether they want to use this in higher SaaS tiers, standalone add-ons, or usage-based pricing.
FIS: Banking is Solid, Capital Markets is the Problem
FIS had a mixed quarter that requires a little more context to understand:
- Pro forma revenue up 5.3%
- Banking revenue up 6.1%
- Payment solutions revenue up 6.4%
- Banking recurring revenue up 5%
- Capital Markets revenue up 3.2%
- Lowered its full-year pro forma revenue growth outlook to 4.5%-5% (down from 5.1%-5.7%)
While there is clearly growth, leadership said the guidance cut was driven by Capital Markets. Specifically, weaker sales and slower backlog conversion.
The most relevant long-term takeaway here is the priority of cross-selling (like we’re seeing elsewhere).
FIS says 72 of its 100 largest customers use products across Banking, Payments, and Capital Markets. And clients using all three generate roughly twice the revenue of customers using just one.
Again, that’s the broader trend throughout this quarter for basically every provider. Get a customer with a core product, then expand the relationship with additional services.
Final Thoughts
As always, quarterly earnings from your processor don’t always tell you outright what might impact your merchant account. Though you can read between the lines between key numbers and what executives are saying on the earnings call.
There’s still useful information, and right now it’s clear that everyone’s priority across the board is to increase revenue by selling additional products.
Whether it’s an AI assistant or another VAS, your processor will be looking for ways to get you to pay more. While some do add value, others just inflate your processor’s margin. And the more you rely on your processor for additional services, the more leverage they have over your account.
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