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SEC Filings

10-Q
FIRST DATA CORP filed this Form 10-Q on 10/31/2018
Entire Document
 


(in millions)
 
Nine months ended September 30, 2017
 
New Revenue Standard Adjustments(a)
 
Acquisitions/Dispositions(b)
 
Core Growth
 
Nine months ended September 30, 2018
 
Constant Currency Percent Change
Sales and distribution incentives
 
$
669

 
$
144

 
$
65

 
$
107

(c) 
$
985

 
 
Salaries, wages, bonus, and outside professional fees
 
1,866

 
(46
)
 
25

 
(10
)
(d) 
1,835

 
 
Stock-based compensation
 
183

 

 

 
9

 
192

 
 
Cost of products sold
 
266

 
(33
)
 
(3
)
 
17

 
247

 
 
Software, telecommunication infrastructure, and repairs
 
291

 

 
(1
)
 
(4
)
 
286

 
 
Other
 
692

 
17

 
(23
)
 
35

 
721

 
 
Cost of revenues and Selling, general, and administrative expenses
 
$
3,967

 
$
82

 
$
63

 
$
154

 
$
4,266

 
7
%
(a)
Effective January 1, 2018, we adopted the New Revenue Standard using a modified retrospective basis. See Revenue Recognition in note 1 "Basis of Presentation and Summary of Significant Accounting Policies" to our unaudited consolidated financial statements in Part I of this Form 10-Q for additional information.
(b)
Expenses were impacted by the acquisition of BluePay in December 2017 and CardConnect in July 2018, and dispositions of Lithuania, Latvia and Estonia (the "Baltics") in September 2017, Live Oak in October 2017, and REMITCO in August 2018. For additional information, see note 12 "Acquisitions and Dispositions" in Item 8. Financial Statements and Supplementary Data" in our Annual Report on Form 10-K for the year ended December 31, 2017 and note 10 "Acquisitions and Dispositions" in our unaudited consolidated financial statements in Part I of this Form 10-Q.
(c)
Increase related to growth in our merchant acquiring business.
(d)
Decrease due to cost savings initiatives, lower incentive compensation and lower fringe of approximately $135 million offset by annual compensation increases and outside professional fees of approximately $125 million.


Depreciation and amortization
 
 
Three months ended September 30,
 
Nine months ended September 30,
(in millions)
 
2018
 
2017
 
Percent Change
 
Constant Currency Percent Change
 
2018
 
2017
 
Percent Change
 
Constant Currency Percent Change
Depreciation expense
 
$
78

 
$
81

 
(4
)%
 
 
 
$
241

 
$
236

 
2
%
 
 
Amortization expense
 
170

 
167

 
2
 %
 
 
 
512

 
477

 
7
%
 
 
Depreciation and amortization(a)
 
$
248

 
$
248

 
 %
 
3
%
 
$
753

 
$
713

 
6
%
 
7
%
(a)
The increase in the nine months ended September 30, 2018 includes $56 million related to the acquisition of BluePay and CardConnect partially offset by a reduction in amortization expense on intangibles that have been fully amortized.

Other operating expenses, net
 
 
Three months ended September 30,
 
Nine months ended September 30,
(in millions)
 
2018
 
2017
 
Percent Change
 
Constant Currency Percent Change
 
2018
 
2017
 
Percent Change
 
Constant Currency Percent Change
Restructuring, net
 
$
20

 
$
24

 
(16
)%
 
 
 
$
68

 
$
63

 
8
 %
 
 
Deal and deal integration costs
 
1

 
21

 
(94
)%
 
 
 
4

 
26

 
(84
)%
 
 
Asset impairment
 

 
8

 
(100
)%
 
 
 

 
14

 
(100
)%
 
 
Merchant matters
 
1

 

 
NM

 
 
 
26

 

 
NM

 
 
Other
 
7

 
4

 
75
 %
 
 
 
8

 
5

 
60
 %
 
 
Other operating expenses, net(a)
 
$
29

 
$
57

 
(49
)%
 
(49
)%
 
$
106

 
$
108

 
(2
)%
 
(2
)%
(a)
See note 9 "Other Operating Expenses, Net" in our unaudited consolidated financial statements in Part I of this Form 10-Q for additional information regarding other operating expenses, net.

39