FIS late Monday withdrew its 2020 earnings guidance and warned that first-quarter earnings and revenue would fall short of prior estimates due to the impact of COVID-19.
The Jacksonville, Florida-based financial technology firm said social distancing measures and lockdown orders enacted in most states led to a deterioration in payments volume as travel, entertainment, restaurants and retail establishments saw sharp declines in spending.
The company now expects first-quarter revenue will come in at $3.06 million to $3.08 million, a 1% to 2% increase in organic revenue from a year ago, compared with previous guidance of $3.18 million to $3.21 million, which represented a 5% to 6% increase from a year ago. It forecasts first quarter adjusted earnings per share of $1.26 to $1.28, compared with prior estimates of $1.30 to $1.34 per share.
FIS said it has taken several steps to help clients and members of its community to get through the pandemic, including the use of its real-time lending service to help process CARES Act loans and issuing additional EBT cards to help families safely get their government benefits.
The company is also waiving monthly fees for U.S. and U.K. merchants during the month of April and is providing free services, including virtual terminals, to help merchants accept secure phone and Card Not Present transactions, which are payments when the customer is making a remote purchase.
FIS is taking several steps to cut costs, including limits on travel, reduced incentive compensation, decreased third-party spending, accelerated automation and functional alignment across the company.
FIS executives will provide further updates during its first quarter earnings call.