Welcome to the Fiserv 2015 Third Quarter Earnings Conference Call. [Operator Instructions] As a reminder, today's call is being recorded. At this time, I will turn the call over to Stephanie Gregor, Vice President of Investor Relations at Fiserv.

Thank you, and good afternoon. With me today are Jeff Yabuki, our Chief Executive Officer; Tom Hirsch, our Chief Financial Officer; and Mark Ernst, our Chief Operating Officer. Please note that our earnings release and supplemental presentation for the quarter are available on the Investor Relations section of fiserv.com. Our remarks today will include forward-looking statements about, among other matters, expected operating and financial results and our strategic initiatives. Forward-looking statements may differ materially from actual results and are subject to a number of risks and uncertainties. Please refer to our earnings release for a discussion of these risk factors. You should also refer to our materials for today's call for an explanation of the non-GAAP financial measures discussed in this conference call, along with the reconciliation of those measures to the nearest applicable GAAP measures. These non-GAAP measures are indicators that management uses to provide additional meaningful comparisons between current results and prior reported results and as a basis for planning and forecasting for future periods. Unless stated otherwise, performance comparisons made throughout this call are year-over-year metrics. With that, I will turn the call over to Jeff.

Thanks, Stephanie, and good afternoon everyone. We delivered strong third quarter results highlighted by the sequential acceleration of our internal revenue growth rate to 5%, excellent adjusted margin expansion and a 20% increase in adjusted earnings per share. These results are consistent with the ramp we expected this year and are indicative of the financial performance and continuing internal revenue growth acceleration we previewed at our June Investor Day. Adjusted earnings per share is up 15% for the first 9 months of the year due to strong adjusted operating income growth and disciplined capital allocation. As a result, we have raised our full year adjusted earnings per share guidance to $3.84 to $3.87, an increase of 14% to 15% over last year. Consistent with our capital allocation strategy and in the face of equity market volatility in the quarter, we repurchased 6 million shares. We remain very committed to that strategy and through September 30, had already returned over $1 billion to shareholders. Sales in the quarter was up sequentially over Q2 and came in at 86% of quota. This is a solid result in light of a tough prior year comparison and heightened expectations for increased performance. We're set up for a very strong finish to the year. Now let me provide an update on our 2015 enterprise priorities, which are: first, to continue to build high-quality revenue while meeting our earnings commitments; next, build and extend client relationships with an increased emphasis on payment and channel solutions; and third, deliver innovation and integration, which enables differentiation and value for our clients. Our first priority centers on building high-quality revenue in areas that support client value, margin expansion and earnings growth. Third quarter internal revenue growth accelerated 5% with strong performance across both segments. Businesses with high recurring revenue,…

Thanks, Jeff, and good afternoon, everyone. We are pleased with our performance in the quarter. Internal revenue growth accelerated sequentially to 5%. These results included a 140 basis point negative impact due to a combination of unfavorable currency impacts and the EMV revenue deferral that Jeff mentioned earlier. Adjusted earnings per share was up a very strong 20% over the prior year to $1.03. Adjusted revenue was $1.2 billion in the quarter and $3.7 billion in the first 9 months of the year. Internal revenue growth was 4% year-to-date. Our continued focus on recurring revenue acceleration was highlighted by a 6% increase in processing and services revenue this quarter, offset by a decline in product revenue, due primarily to lower card reissuance revenue in Output Solutions. Combined license and termination fee revenue benefited revenue growth by 60 basis points in the quarter and 20 basis points year-to-date. Adjusted operating income growth was excellent, increasing 11% in the quarter and 9% year-to-date to $411 million and $1.2 billion, respectively. Adjusted operating margin was up 190 basis points in the quarter to 33.1% and year-to-date was up 150 basis points to 32%. Margin performance across both segments was primarily driven by revenue growth in our scale processing businesses and cost efficiencies, including savings from our Operational Effectiveness programs. Now on to the segment results. Internal revenue growth in the Payments segment was 6% in the quarter versus our strongest prior year quarter and up 5% year-to-date. Growth in our card services and biller businesses led the segment performance. While EMV production in our Output Solutions business increased, much of that revenue, $9 million, was deferred to future periods to the cards which have been fully manufactured as of quarter end but not yet personalized. We have added nearly 100 new debit clients…

Thanks, Tom. As I mentioned upfront, sales in the quarter were 86% of quota. Actual sales performance was down a bit compared to the prior year's results, primarily from deals pushing to future quarters. Pipelines are solid across the board, including good traction with our newer solutions. We expect to finish our sales year strong, leading to excellent momentum going into '16. Integrated sales in the quarter were $57 million, led by solutions, such as debit and credit services, Mobiliti, bill payment, Source Capture and statement processing. With integrated sales of $168 million through September, we expect to meet our $250 million target for the year. Operational Effectiveness savings were up sequentially in the quarter and now at $44 million year-to-date. In addition to solid end year performance, we are building the foundation to achieve the new $250 million target we shared at Investor Day. We were pleased to complete the construction of our Alpharetta Campus in the quarter. 80% of our nearly 2,000 Atlanta-based associates from a number of locations are now housed in our new state-of-the-art facility. In conjunction with this project, we also consolidated 2 of our largest data centers, which we also expect will generate meaningful savings. Although the financial institution environment remains generally stable, the conjecture and implications around interest rates were front and center in the quarter. M&A activity is progressing at elevated levels, which we expect will continue. While regulatory and efficiency remain in focus, we are starting to see early movement by financial institutions towards revenue-focused solutions that deliver end-user value at the intersection of real time, digital and evolving consumer expectations. As I mentioned upfront, we are well positioned to achieve our 2015 financial objectives, which include our third consecutive year of increased internal revenue growth. We are tightening our internal…

[Operator Instructions] And now our first question is coming from Mr. Glenn Greene of Oppenheimer & Co.

Tom, sorry to see that you're leaving.

Thanks, Glenn.

Yes. I guess the first question would be maybe, Jeff, if you could give us a little bit more in terms of the environment and the sales outlook. It sounds like the sales was okay in the quarter, not great, maybe a few deals were pushed out. Maybe just more about the -- from a bigger picture perspective, the sales environment not only into the fourth quarter but heading into 2016, and then I got a follow-up.

Sure, Glenn. And I would say that while sales were a little bit lower than obviously 100% in the quarter, We've had 2 really great years in a row, kind of 2 record years. And I think to some extent, we are focused on transitioning from a lot of the things that we've sold historically. We had a big burst of energy, right, as we brought DNA in; we're in the midst of bringing those live and we're getting some very strong traction with some of the newer solutions that I talked about today, whether it be Popmoney for disbursements or Immediate Funds, CardValet, a number of different products. So while the first few quarters have been a little bit light, we expect quite a strong fourth quarter. We typically have had larger deals in the middle of the year. This year, those deals have been a bit bifurcated. We had a little bit early. We expect to see several of them late, and we feel very good about our pipeline and the momentum going into next year across -- really across the entire company.

And then could you just remind us where you are on the conversion pipeline both for DNA and the account processing pipeline? And it sounds like you're going to complete 30 of the DNAs this year. Is there -- what's the balance going into '16? And then just an update on the account processing pipeline, too -- conversion pipeline.

Sure, absolutely. I would say that still, the majority of our larger deals have not yet been converted in this year. I mentioned that we've got 6, $1 billion-plus institutions going live on DNA alone in the fourth quarter. We haven't given any visibility yet into what next year's conversion cycle looks like. We'll give a little bit more visibility into that when we get into February when we give guidance next year. But we're making good progress. We -- our biggest clients, I mentioned Washington Federal, which is our largest DNA conversion, that'll go live in the fourth quarter. So much of that revenue will start to show up in Q4 and then turn into next year. And across the rest of our platforms, most of our larger conversions are going into next year. So we will not have benefited from them in 2014 -- 2015, I'm sorry.

Okay. So you still have the comfort and visibility to think that organic growth will further accelerate in '16?

Absolutely. I mean, we stand very clearly by our conversation at Investor Day. We're going to see -- we're going to exit the year as we said at approximately 6% and we expect to have that be a good foundation for our growth going into next year.

Our next question is coming from Mr. Jim Schneider of Goldman Sachs.

I was wondering if you could maybe talk a little bit about the margins and the sustainability of them. Obviously, some good upside and I guess some one-time items in the quarter. But can you maybe talk about what really drove that upside? Was that purely the incremental margin contribution from the Payments side business? Or are there also some kind of ongoing benefits from data center consolidation that were in there in the quarter?

Yes, it's a great question, Jim. And I think our margins -- we are very disciplined with what we do. We clearly have some benefit from our Operational Effectiveness initiatives and just general cost efficiencies. I think, again, combined with really high-quality revenue, a lot of our revenue growth again is coming in our card services or our biller business, where the incremental margins of those particular solutions are fairly high. So you can see on the cost dynamic, that our costs -- overall costs have increased this year, year-to-date, about 2% only. And again, we have a lot of factors that contributed to that high-quality revenue. We have a scalable model and our Operational Effectiveness including, as Jeff talked about our -- some of our data center consolidations, which are actually going to have a greater impact as we look out over the next several years. So we continue to be confident and continually margin expansion over the next several years as we kind of going into our next phase of Operational Effectiveness.

That's helpful. And then maybe one for Jeff. Just to follow up on the sales question, can you maybe talk about the types of deals that pushed out into Q4 or into 2016? Were those mainly on the core processing or DNA side or were there more ancillary things like bill pay and Popmoney?

Yes, they tend -- the deals that you manage from a slippage perspective tend to be the larger, broad solution, kind of multiple solution deals so they biased -- they did bias to the account processing, the core processing side. We had a couple of other deals slip in the lending side, but it's really on the account processing pieces of the business.

Next question is coming from Mr. David Togut of Evercore ISI.

I'm not sure whether or not to congratulate you, Tom, but you'll certainly be missed.

Okay. Thanks, David. I appreciate that.

David, we're going to go for congratulations.

Okay. Well, definitely a bittersweet moment.

Yes.

I had a question on DNA. I know with the previous generation product acumen, one of the challenges you faced was much longer-than-expected conversion time line. What are you finding on these big DNA wins in terms of time line to convert versus your expectations?

Now that's a very good question, David. We are actually very, very happy with the implementation work that's happened with DNA, especially given that this is -- was new to the family just in early '13. And we have meaningfully ramped up their implementations. I would guess that we'll do more implementations in the fourth quarter than that business did in the prior 12 to 18 months. So we have ramped it up nicely. And we are finding to the extent that there are any issues and there have been very few, but if there are any issues, they are not coming from us. They're coming on the client side. And these have also tended to be larger, multiple product implementations. Again, so they've got a level of complexity, and the team has dealt with them beautifully. Most of the clients are referenceable, if not on day 1, on day 3 or 4. So we're feeling very good about the implementations to date, and that's one of the reasons why we have great momentum in the market.

Great. And then do you have any data on attach rates? You've highlighted your surround strategy with DNA. Any data on attach rates for products like payments and so forth?

I would say that we're seeing at or better than what we've seen across the enterprise. If you remember, when we acquired Open Solutions, one of our strategic hypotheses was that because Open didn't have the value of the surround set, that there was something that had been missing from that value proposition as we brought it in, as we shared on our Investor Day, we've been very happy with the level of both sales within the new DNA win since we've acquired it, but even more important, have been the ability to penetrate the existing base. So we're not going to give that data right now, but I would say we remain as optimistic and with the same level of conviction as when we talked in June and when we talked prior to that.

Your class savings appear to be running ahead of plan. As we see these big implementations of DNA, should we expect the operating leverage of the business to improve even further?

Well, so I would separate, the cost savings from the point of operating leverage, primarily when we're talking about operating leverage, we'd be talking about the ability to add new revenue to our scaled businesses at a pretty low incremental margin -- I'm sorry, pretty low incremental cost to very high incremental margin. And at the same time, at some point, we will likely be able to reduce the size of our implementation team within DNA. But frankly, that's the last thing we want to do. I'd like nothing better than to be building that implementation team out even further because we're winning lots of deals there. The majority of this next phase of $250 million of Operational Effectiveness saves is going to come from looking to become more efficient in our real estate footprint, looking to bring together some of our dispersed data centers, and also looking for ways to get better leverage out of our dispersed workforce. So those are the big 3 ways that we see that we're going to knock down that $250 million. Remember also in our Operational Effectiveness savings, they're going to be a little lumpy by quarter, right? And so we had a very good quarter this year, I think we're just about $5 million to $6 million away from our target for the year. Hopefully, we'll stay ahead of that as we can, but we continue to build that muscle and we feel good about our ability for the next few years to use that to create supplemental margin moving forward.

Got it. Just 2 quick housekeeping questions. Can you give the debit volume growth in the third quarter? And then if you could call out the termination fees that standalone outside of the software license fees and what the year-over-year compare is?

Yes, David, I think the -- I don't have that in front of me. But the year-to-date is around 10%. I think in the third quarter, it's somewhere in the high single digits for debit, exactly. And roughly around 10%, I believe, on a year-to-date basis. Again, good growth in that particular area. Regarding the termination fees, I know, David, as you well know, right, it's kind of the normal part of our business and they vary period to period. The combined license and termination fees were up about $6 million to $7 million in the third quarter and year-to-date compared to the prior year. To your question specifically, termination fees overall were up by approximately $10 million year-to-date and for the quarter. This was offset, however, by a decrease of about $5 million in license fees year-to-date and for the quarter. And just as a reminder, we had negative currency impact in the quarter of about $8 million and $20 million on a year-to-date basis, which more than offset those increases. And as Jeff highlighted, we had to defer about $9 million of EMV revenue in the quarter due to the fact that we've completed the manufacturing element. But have not personalized the cards, which is a smaller part of that, which will happen. And so with that, that's the numbers on the termination fee side.

Our next question is coming from Mr. Dave Koning of Baird.

Congrats, Tom. A ton of good quarters in the last 10 years, for sure. And I guess my first question, the EBIT growth, just I guess on an organic basis you could say, it was about the strongest it's been in probably the last 8 years or so, maybe even longer. And so I know you isolated high-quality revenue and some cost initiatives and stuff. But I mean, it was so strong relative to kind of the last several years that -- is it more on the just high-quality revenue? And maybe what's changing compared to the last several quarters?

Yes, I think, Dave, I don't always look at one quarter, right? There's always puts and takes in every quarter. But if you look at it on a year-to-date basis, right, our operating income is up 9%, which is very strong. Our expense base is up a couple of percent. And I think it's a combination of all those factors that we've been really focused on. And there's not one thing, as you well know, that drives us from a result standpoint. It's a combination of all the things that you talked about, right? It's the revenue mix of high-quality revenue, it's the Operational Effectiveness areas that we're making good improvement on. Selling the right things that are dropping that through and just continue to focus this organization on continuing to be more efficient across the board. So again, there's not really 1 or 2 things that stand out. It really is when you look back out at it, the overall business model, and just making sure that our teams are executing that business model as well as we possibly can.

Dave, I'd just add one thing. I mean, to your point of this notion we talk a lot about high-quality revenue. And in the quarter, we had lots of different discrete benefits, high-quality revenue, Mobiliti, Mobiliti users, some onetime revenue. We're able to offset some smaller term fees -- I'm sorry, smaller license revenue. You have all kinds of things going on. I guess the only point I would make is because of how we've shaped the model, whether that revenue comes in through a Mobiliti user or it comes in from a one -- kind of a onetime or occasional revenue, the drop throughs are going to get better and better because of how we're managing the cost base overall. And that -- we like that because obviously, it gives us the margin and some business model expense leverage, but it also gives us the ability to invest at times where there are opportunities for us to invest. And so we -- as you know, we're committed to raising margins 50 to 100 basis points a year. And when things are going a little bit better, we'll look for ways to invest to take advantage of those where the perfect storm comes in our favor.

Got you. Okay, that's helpful. And then I also looked at -- it looks like your guidance is for EPS to be down just a bit in Q4 sequentially. And I looked back -- the last time that happened was Q4 2007, it looked like. So I guess is Q4 a quarter where you're going to invest some of that away? Or maybe I think you paid some bonuses a few years ago at different times kind of spend a little extra away. Is that maybe what's happening this year?

That's a good memory, Dave.

Yes, it is.

That's a good memory. I think that was Q4 of '07 or Q4 of '08? I think it was an interesting time.

We do have a couple of things going on in the fourth quarter that are going to have those expenses a little bit higher than we had in Q3. [indiscernible] there's a couple of investments there. We do have a couple -- a little bit of business mix. We're also going to experience higher commissions as Jeff indicated earlier on. We're going to have some strong sales results in the fourth quarter. We also have our Fall Forum Client Conference in the fourth quarter. And then last but not least, we are self-directed or self-insured for our health claims, Dave. We're going to have a pretty significant ramp in the fourth quarter this year compared to the other quarters. There's normal seasonality there, but it's going to be much bigger. And so those are all kind of 4 or 5 different events that are kind of impacting our Q4 a little bit higher expense level than we normally would have. And so again, none of these things are really when you look at from a year standpoint, overall, it just kind of the way that things are kind of hitting that quarter.

Next question is coming from Mr. Andrew Jeffrey of SunTrust Robinson Humphrey.

Tom, you certainly will be missed, there's no question about it.

Thank you.

Jeff, one of the things you've talked about as one of the sort of overriding themes from a strategic perspective is real-time payments. Could you just step back as you talk about high-quality revenue and the margin improvement you've been enjoying, and certainly, disbursement is an interesting new offering and new functionality. Generally speaking, faster settlement, real-time settlement, is this all part of everything that's going into Fiserv's sort of innovation when I think about Mobiliti Suite and so forth? Or is there a separate call out that we're going to be talking about a year from now or 18 months from now around a real-time payment suite of products?

Well, I mean, I -- we started to talk about that, Andrew, at Investor Day. And we've used a label of now to try to capture this notion of realtime beyond point-of-sale, right? There's a big war that's going on at point-of-sale, whether it's MCX or whatever's going on out there, there's a lot of that. And we're really focused on the DDA-based payments beyond point-of-sale, and that's both payments and deposits. And so the product that we talked about that was Immediate Funds, that's around deposits. The disbursement product, that's not necessarily leveraging realtime, although certainly, the businesses will have the opportunity to decide if they want to use a real-time rail to make that payment. And I only set that up as context because the answer is, I'm optimistic that over the next several years, we'll have lots of conversations to talk about leveraging all of the construction that's going on in the real-time space and linking that construction into our front-end applications and weaving that construction into the backend of our real-time payment system. And that will, whether it's Mobiliti or Popmoney or RXP or Immediate Funds or something that we haven't thought of yet, all of the different functionality that exists in the DDA, I think the example we used at Investor Day was being able to make a payment through bill pay and get immediate credit at a bank where you have -- a consumer has a credit card account. We see that all as options and ways to help consumers use the real-time networks that are being built right now. I think one of the confusions, as you well know, is which rails are going to be built? And so while we are, to some extent, in the business of constructing those rails, we also don't think that there is a single ubiquitous rail that we can build. We think we can enable people to use some of our technologies and we will connect to other people's technologies. But we -- our ambition is to bring that real-time capability to our applications to enhance the consumer experience to hopefully drive revenue for the financial institution and value for the different users. So I know it's a longer -- maybe a longer answer, but that's how we're thinking about it right now.

Okay. So more to come in terms of this theme of really giving your customers or the FIs, the ability to drive more revenue in their businesses.

Exactly. And we've been planting a lot of those seeds, whether it was through the 2,100, 2,200 Popmoney institutions that we have today, or the 6,000 -- 5,000, 6,000 RXP institutions we have today. And now bringing Mobiliti, right, all kinds of those. So those -- the flags are being planted, right, the rails have to actually get caught up to allow more ubiquity in the backend.

And then just as a follow-up, with regard to international, are there assets out there that might make sense for Fiserv in terms of the significant step up in international exposure? Is that still something that is central to the long-term growth plans?

Well, I mean, I would say that we have never said that international is essential to our long-term growth plans. What we have said is we see a couple of discrete opportunities, Agiliti is one of them where we can create a boost to our internal revenue growth rate. But at the end of the day, I think we have 6%, 7% of our revenue is international. It's going to be hard even if you're adding 1% of internal revenue growth, it's going to be hard just to call that essential to the company. To date, we have not seen large international acquisitions. I assume that you're asking question around large, that would make sense for our model. Frankly, we have seen so much opportunity in the U.S. right now that, that's where our focus is. We certainly look at some of the assets that become available. But for right now, the majority of the opportunity that we see international beyond the 6% or 7% of revenue that we're focused on today is really trying to make the world smaller, right? So allowing money to move more simply between the U.S. and Australia or the U.S. and India or the U.S. and wherever and back, right? And so looking at different technology solutions that may make that easy so that banks and others can facilitate the global movement of money simply, easily and securely.

Next is coming from Mr. Tien-Tsin Huang.

I guess, I want to ask -- build upon Dave's question just on the margin front. I'm curious given that you guys have outperformed year-to-date and I caught the fourth quarter commentary. Have you considered sort of changing your investment sort of philosophy, the discretionary versus nondiscretionary mix, for example? Just as you look forward into 2016 and '17?

Well, I think Tien-Tsin, what we said is that historically, where we have been meaningfully outperforming our margin guidance that to the extent that it makes sense for us and our shareholders and our clients that there are ways that we can further invest and still ensure that we meet our financial commitments, we take a look at that. I think Tom was also talking about some of the timing of expenses that we believe that will hit us in Q4. But that said, one of the things that we've talked about over time is the combination of the revenue model that we're building, and the benefit of the Operational Effectiveness program really gives us more capacity to invest and grow the business or frankly not invest and let it flow through to the bottom line. So we're looking at that all the time quarter-on-quarter, year-on-year, month-on-month, depending on what's going on. Now you know well that we don't make large, it's hard for us to decide in a heartbeat to make a big capital investment. Most of our investment is through our P&L. It's linked to labor, so you have to hire people. So you can't make big decisions to change -- I can't make a big decision to change my expense trajectory next week. But you can be sure that we have investments teed up that we have an idea that where it makes sense, that maybe we should deploy money in a different way.

Okay, understood. That's what I was thinking about longer term because resketching that I know is tough in the short time. Just on that core system conversion side, I wanted to ask a question there. I know there's been a lot of DNA wins, you've had some good wins also like First Hawaiian and, et cetera, including some Corillian stuff. I'm just curious, the year's almost done, have you seen in hindsight here a bigger appetite for conversions, and how does that feel going into next year on the conversion side?

So we have seen more activity in the larger end of the base in 2015, than we have probably in the last 5 or 6 -- at a minimum in the last 5 or 6 years. We have -- there's more discussion and movement on the real-time core processing side of the house. We are not seeing a lot more activity below that level. We're seeing a lot of competition in that -- in the smaller -- kind of in the $1 billion and below -- in the below space, and so there's a lot of activity there. But we are seeing processes, RFP processes, evaluation processes going on. We've been pleased that we've been involved in that. We've actually been down selected once or twice in pretty big evaluations, which is something that we would not have been able to do frankly had we not acquired DNA. So we are seeing some activity there. I think that'll manifest over time. One of the beauties to that is the institutions that are doing the evaluation tend to know us because they're -- maybe they're a Corillian client, they're very likely a bill pay client. In that space, we've got a number of really important solutions, the PEP+. PEP+ client, so they're using our technologies and so we have a relationship with them. Whether that will ultimately get us over the finish line, we'll see. But we do think it has them give us more consideration than if we were one of the new kids on the block.

And, Tom, thanks to you and, obviously, wish you the best.

Thank you.

Next question is coming from Mr. Ramsey El-Assal of Jefferies.

On EMV, I'm trying to understand better whether that $10 million in EMV revenues in the quarter -- putting aside for a second the deferral issue that you pointed out, does that represent a material increase versus EMV revenues last quarter? I mean, what I'm trying to get a better sense of is, does this result signal any type of ramp that we're finally sort of seeing this delayed EMV ramp? Or it is just sort of a still kind of business as usual?

Yes, I would say I'll take it first then turn it over to Jeff, Ramsay. I think we are seeing a tick up clearly, right? We didn't have this activity in the first half of the year. And clearly, in the third quarter, it's building as we anticipated right? So we did $10 million of EMV -- incremental EMV manufacturing in the third quarter, which is much more significant than the second. We had to defer $9 million of that to future periods. But as we laid out on kind of Investor Day as Mark laid out, right, this 2015 is going to be the low water point. And it's building nicely as we look out into '16 and '17. And so that's the way I would phrase that. But, Jeff, I don't know if you wanted to add something else to that.

Yes, the way -- probably a little bit more context. So the $9 million that we ended up deferring, we ended up deferring it -- first of all, we had to defer it because it was the first time we had really meaningful EMV activity, but if you think about the $10 million of production for the quarter before the deferral, the 10 x 4 is 40, but that's $40 million in a year. If you go back and look at what we've laid out for Investor Day, I mean, that would have been the start of a very attractive run for us. So the answer is yes. We saw a lot more production. We ended up needing to defer the $9 million of the $10 million, and we believe that, that deferral will stay constant for a while, right? And so if you look through that, we would expect to be able to recognize a more normal amount of revenue moving forward.

Changing topics here. The clearXchange had a recent change in ownership. It seems like the banks are trying to fuse [ph] it up with some sort of fraud and risk- related assets that they have and potentially maybe focus a little more on the realtime side of things. Does this change the competitive landscape at all for you guys in that space?

Yes, it does. Actually, I would say it does more than change the competitive landscape. I think it's quite a positive move for the landscape in general. I mean, Early Warning is famous for having very high-quality risk and analytics and they do a great job. We announced a partnership with them at our Investor Day. We're doing some very interesting work on the realtime side. Now they have not traditionally been in the real-time payment world. They're in the real-time data exchange world, and they're going to build out some capabilities. We're building a nice partnership with them, and we expect this to be quite positive for the industry. Remember, clearXchange is the -- really the backend of the process, where they're enabling some of the engines for those institutions. Those institutions still need front-end applications. A number of those institutions that are in clearXchange, as well as another 2,000, more than 2,000, around the system use our front-end. So I'm hopeful and optimistic that this will move the industry closer to more ubiquity in allowing consumers to move money at the speed of their choice, so we're quite excited about it.

Sort of a rising tide lifts all boats sort of mentality it sounds like which makes sense. One quick last one for me. On Agiliti in the U.K., is the rollout there still kind of tracking to your expectation? I think you mentioned potentially rolling a customer out there towards the end of the year or the beginning of next year. Is that still sound like a reasonable goal?

Yes, we would expect to be live. I would say at this stage because it's taken a little bit longer to get this first contract signed, it's a little bit more difficult when you're building a business from scratch, subject to all of the regulatory approvals and everything else. But I would expect this to go live in the first half of next year with multiple clients. So I'm -- we're really excited about that.

Our next question is coming from George Mihalos of Cowen and Company.

This is Allison in for George. Tom, let me add my congratulations on your retirement. I just had a quick question within the Financial segment, I'm curious if you can disaggregate a bit what growth trends you're seeing across core processing, item processing and loan servicing businesses. I'm wondering if it's fair to say that the core processing business is growing above total segment revenue growth while the other businesses are below.

I would say in the Financial segment, as you're aware, right, the largest share of our revenue comes from the core processing area, so clearly, that's growing faster than our areas like check processing, which is in decline. So that is correct. I think the other areas that we have in there, lending has been growing nicely. But we have been impacted -- our international businesses in there, so our currency is kind of negatively impacted that segment. And we should, over time, continue to see international contribute to that. But to your point, item processing is a bit of a drag. The core is the big piece of growth that's in that particular area are along with our lending area.

Yes, I would say I mean, just for clarity, that we have both seen some good growth trends coming out of the lending businesses and that we would expect over the next couple of years to see lending itself be an important part of how financial institutions are obviously going to drive revenue. So those trends, we think, will look better moving forward than they have historically, as people have not really been spending in that space. Thanks, everyone, for joining us this afternoon. We appreciate your attention and support. If you have additional questions, feel free to contact our IR team. Have a great day.

Thank you. And that concludes today's conference. Thank you for participating. You may now disconnect.