April 23 (Reuters) - Payments firm Fiserv raised its annual profit forecast and topped Wall Street estimates for first-quarter results on Tuesday, helped by strong consumer spending, sending its shares up 2.7% before the bell.
Consumer spending, supported by a tight labor market and healthy wage growth, has remained strong despite some uncertainty caused by higher inflation and interest rates staying elevated for a longer period.
Wisconsin-based Fiserv, a provider of payments and financial services technology offerings, collects fees from merchants, banks and credit unions for processing transactions. Such fees are determined by consumer spending volumes.
The company said it now expects adjusted profit of between $8.60 and $8.75 per share in 2024, higher than the $8.55 to $8.70 range it forecast earlier.
Processing and services revenue, which makes up more than four-fifths of Fiserv's revenue, rose 8.9% to $4 billion in the quarter.
Total revenue jumped 7.4% to $4.88 billion in the quarter, compared with analysts' estimates of $4.58 billion, according to LSEG data.
Fiserv earned $1.88 per share on an adjusted basis in the three months ended March 31, compared with analysts' average expectation of $1.79 per share.
Shares of Fiserv have risen 12% so far this year as of their last close, compared with an 18.7% gain for peer Fidelity National Information Services. (Reporting by Arasu Kannagi Basil in Bengaluru; Editing by Ravi Prakash Kumar)
