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The big processor Global Payments Inc. on Tuesday morning reported a busy third quarter that included an expansion of its relationship with PayPal Holdings Inc., ventures in the hot buy now, pay later market, recovery from the pandemic’s impact, and growth in the company’s issuer business stemming from its link to Amazon Web Services.
Despite the restrictions imposed by local governments to manage the Covid pandemic, Atlanta-based Global Payments has seen increased adoption by consumers and businesses of contactless payments and online commerce. “The trend toward digitization coming out of the pandemic has benefited our business,” Jeff Sloan, chief executive, told equity analysts.
Indeed, “a number of our businesses have grown right through the pandemic, including acquiring, and have now achieved a level we would have expected absent the pandemic,” reported chief financial officer Paul Todd during the call. As a result, Global is closing in on positive comparisons with 2019, the last full year before the pandemic struck in the United States. “It’s fair to say we’re still on the road to recovery in vertical markets, but we expect the business overall to turn positive relative to 2019 in the fourth quarter,” said Global president Cameron Bready.
BNPL in particular is “a market we know well, it’s a market we’ve been serving for a decade,” Sloan said, adding Global’s technology will support a total of 1.5 billion BNPL transactions by the end of the year.
Growing consumer adoption of digital payments, meanwhile, could help drive Global’s expanded agreement with PayPal, which will now include support for the San Jose, Calif.-based payments giant’s cryptocurrency trading facility across multiple markets. “We’ve extended and expanded our relationship with PayPal in America, Europe, and Asia,” Sloan said.
Under the expanded arrangement, Global will now support PayPal users looking to purchase crypto through PayPal’s digital wallet when the users pay for the digital currency with bank cards, according to a Global spokesperson. Global is also supporting online purchases of crypto through the PayPal button, again if the users pay with bank cards, the spokesperson adds.
On the issuing side of Global’s business, the link to AWS, which Global forged in August last year, has proven particularly fruitful in recent months, the executives said, in attracting neobanks, startups, and fintechs. “We win 80% of the jump balls that come up,” said Sloan, relying on a basketball analogy. “Our partnership with AWS really does sell.”
For the quarter, Global reported $2.2 billion in revenue, up 15% year-over-year and compared to a pandemic-inflected quarter in 2020. Its biggest segment, merchant solutions, recorded a 20% increase to just shy of $1.5 billion. Issuer solutions was up 7%, to $522 million.
For the first nine months of the year, the company reported $6.3 billion in revenue, up 15%. Merchant solutions’ revenue came to $4.2 billion in revenue, up 21%, with issuer solutions up 4.6%, to $1.5 billion.
