Welcome to the Fiserv 2017 First 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 Paul Seamon, Vice President of Investor Relations at Fiserv. You may begin.

Thank you, and good afternoon. With me today are Jeff Yabuki, our Chief Executive Officer; Bob Hau, 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, anticipated benefits related to acquisitions 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 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-to-year metrics. As a reminder, we're holding our Investor Day on June 20 in New York City. We expect the session to begin at 9:30 a.m. and end around noon. We'll have a number of our executives available to meet with attendees before and after the event. We look forward to seeing you there. With that, I'll turn the call over to Jeff.

Thanks, Paul, and good afternoon, everyone. We're off to a strong start to the year with financial results for the quarter slightly ahead of our internal expectations and sales results well ahead of the prior year. Importantly, we're on track to achieve our 2017 financial outlook. Internal revenue growth was 4% in the quarter and adjusted operating income was up 8%. Adjusted operating margin expanded by 60 basis points, and adjusted earnings per share was up a very strong 18%. Free cash flow per share was stellar, increasing 27%. And that excludes a $31 million cash distribution from our StoneRiver joint venture received during the quarter. We were honored to be named one of the FORTUNE magazine's World's Most Admired Companies for a fourth consecutive year, a recognition that we share with our clients, associates and shareholders. We were especially proud to be ranked #1 for innovation in our category for the second year in a row. At the beginning of the year, we shared our 2017 key priorities to help you gauge our progress: the first, continue to build high-quality revenue while meeting our earnings commitments; second, enhance client relationships with an emphasis on digital and payment solutions; and third, deliver innovation and integration, which enables differentiated value for our clients. Our focus on building high-quality revenue translated to 4% internal revenue growth in the quarter, with strong performance in businesses such as card services, lending solutions and output solutions. Growth in scaled businesses, along with continued progress with our operational effectiveness programs, combined to deliver 60 basis points of operating margin expansion and 8% growth in adjusted operating income. You may have seen that we attained a new level of Payments segment margin that we believe is representative of the strength of those businesses moving forward. At the same time, we continue to operate to deliver the right balance between investment, consistent margin expansion and strong free cash flow. As I said, we're pleased with our results in the quarter and are well positioned to deliver on our financial commitments for the full year. Our second priority is to enhance client relationships with an emphasis on digital and payment solutions. We welcomed Whatcom Educational Credit Union to the Fiserv family in the quarter. This institution, with assets of $1.4 billion, was in the market to upgrade both their core account processing and digital channels technologies in response to the evolving market landscape. In a competitive process, they selected our DNA platform due to its flexibility and modern technology. They also chose Architect, our market-leading digital solution, along with a number of other integrated surrounds, all geared at enabling an exceptional member experience. We signed a total of 5 DNA clients in the quarter, including 4 with assets greater than $1 billion. During the quarter, we also passed the century mark in DNA signings since our acquisition of Open Solutions in 2013. Interest remains high as the market continues to embrace this modern technology platform combined with the power of Fiserv's surround solutions. We expect to see even more over the next several years as we further advance the solution through differentiated product enhancements and integration with our recently acquired market-leading commercial capabilities. You may recall that we mentioned our Notifi alerting solution in Q4. Notifi enables financial institutions to interact with their customers in a personalized way based on transactional data. We signed over 50 institutions in 2016 to our 1.0 solution and added 20 more in the first quarter. We're excited about this capability and optimistic about the value-add data opportunities that should become available over time. Digital experience continues to rise in importance for both financial institutions and the customers they serve. Along those lines, Mobiliti ASP continues to grow, increasing nearly 30% over the prior year's quarter and 6% sequentially to 5.8 million subscribers. Our Mobiliti business solution is also taking hold with sales increasing more than 60% over the prior year. Institutions remain in the early stages of unlocking the power of digital and are looking for additional ways to enable value for their retail and commercial customers. Our third priority is to deliver innovation and integration, which enables differentiated value for our clients. Last quarter, we told you about our recent acquisition of Online Banking Solutions, or OBS, and its sophisticated digital commercial banking product now called Commercial Center. OBS is an example of acquired innovation, which, when coupled with our other leading solutions, positions us to deliver accelerated client value and additional revenue growth. We're encouraged by the interest that OBS has sparked, especially in larger, commercially focused institutions. We mentioned Architect, our integrated online and mobile banking solution for both retail and business customers earlier as part of the Whatcom Educational Credit Union win. Architect was acquired about a year ago and we signed 14 clients to date. We also have a growing pipeline of 70 institutions who are exploring this innovative digital solution. We continue to rank digital experience as one of the most critical areas of focus for all financial institutions, domestically and around the world. Last quarter, we shared our enthusiasm with you for BillMatrix Next, our biller-based digital payments platform, which allows us to efficiently process any number of payment types. This solution has rapidly opened up the broader bill payment market on both a standalone basis and across our account processing clients, enabling enhanced multichannel billing and payment capabilities. We're in the early days of our launch plans and even still had 12 new sales in the first quarter, along with a very strong pipeline. We'll share much more about these growth plans with you at our upcoming Investor Day. Fiserv's PEP+ solution, our integrated payment platform, which provides the ACH infrastructure for many of the largest banks in the U.S., recently won an Innovator Award from PYMNTS.com. The award, which recognized our same-day settlement capability, reflects the growing importance of faster payments in this country. With that, let me turn the call over to Bob to provide more detail on our financial results.

Thanks, Jeff, and good afternoon. Adjusted revenue grew 5% in the quarter to $1.3 billion, and internal revenue growth was 4%. Solid execution, along with some revenue timing benefits, drove internal revenue growth that was slightly ahead of our expectations for the first quarter. We continue to expect internal revenue growth acceleration in the second half of the year as revenue related to 2016 sales and contributions from new initiatives come online. Operating performance was strong, resulting in an 8% increase in adjusted operating income to $429 million and also 60 basis points of adjusted operating margin expansion to 32.5%. Adjusted earnings per share for the quarter was up 18% to $1.25, which includes the positive impact of the new accounting treatment for reporting the excess tax benefit from share-based compensation awards. This impact was somewhat offset by low adjusted tax rate in last year's comparable quarter. Our Payments segment delivered 5% internal revenue growth, led by strong growth in card services, output solutions and investment services. Adjusted revenue was up 7% to $720 million. Debit transaction growth for the quarter was in the high single digits, and P2P transactions for the period grew more than 20% year-over-year. P2P growth was driven in large part by real-time transactions, which were up significantly at more than 300% in the quarter. We expect further acceleration in our P2P growth throughout 2017 and 2018 as Zelle is launched later this year. The Payments segment adjusted operating income was up 16% to $260 million in the quarter. Adjusted operating margin in the quarter was up 270 basis points to 36.2% due to increases in high-quality revenue, benefits from our operational effectiveness programs and to a lesser degree, timing of comparable expenses. While we don't expect margins to increase at that level each quarter, we do expect strong performance in the segment for the balance of the year and into the future. The Financial segment adjusted revenue was up 4% for the quarter to $620 million. Internal revenue growth was up 4%, led by our lending solutions, account processing and international businesses. Revenue growth in the Financial segment was slightly ahead of our expectations due to the acceleration of some periodic revenue we had originally anticipated in the second quarter. Adjusted operating income in the Financial segment was just ahead of the prior year at $196 million. Adjusted operating margin for the quarter was down 100 basis points to 31.6%, due primarily to higher sales commissions, the timing of periodic expenses and continued investments in newer products such as Agiliti and Notifi. The corporate adjusted operating loss in the quarter was up due primarily to a tough prior year comparison. We expect the corporate segment to remain generally consistent with the first quarter's level for the balance of the year. Our adjusted effective tax rate for the quarter was in line with our internal expectations at 29.4%. As discussed in our last call, we included the positive impact from adopting the new accounting standard for the excess benefit of share-based compensation on our adjusted tax rate guidance for the year. The expected benefit is frontloaded in the year due to the timing of option exercises and vesting of restricted units, which can tend to be more concentrated in the first quarter when equity grants typically vest. This benefit was partially offset by a relatively low adjusted tax rate in last year's quarter, producing a net benefit of about $0.06 per share. Consistent with our prior guidance, we continue to expect a full year adjusted effective tax rate of slightly below 33%, which translates to a tax rate for the remainder of the year of about 34%. Free cash flow was up a very strong 23% in the quarter to $366 million and up 27% on a per share basis to $1.67, due primarily to strong operating results and positive working capital. These excellent results do not include a $31 million cash distribution from our StoneRiver joint venture. Total debt outstanding at the end of the quarter was $4.6 billion or 2.3x trailing 12-month adjusted EBITDA. We repurchased 3.4 million shares for $389 million in the quarter, which is an increase of more than 20% over last year's comparable quarter and equates to 106% of free cash flow. As of March 31, there were 212.9 million shares outstanding and 17 million shares remaining under our existing share repurchase authorization. With that, let me turn the call back to Jeff.

Thanks, Bob. We followed up last year's record fourth quarter sales with a solid start to the year. Overall sales in the quarter were up 30% over the prior year and up 35% domestically, led by strong Financial segment sales. Quota attainment came in at 82%, which, as you can tell by the relative performance, reflects increased sales expectations for the full year. Importantly, our domestic pipeline expanded by 17% in the quarter, and we're very well positioned to meet our sales goals for the year. Integrated sales increased 7% to $51 million in the quarter, led by card services, digital solutions and output solution. Providing additional value to our existing client base is an essential part of our strategy. We kicked off the second year of our $250 million 5-year operational effectiveness program in the quarter and achieved $20 million of savings, led primarily by procurement and labor optimization. We also continued to make great progress on our data center consolidation program, combining 5 locations in the quarter. We're well on track to achieve our $60 million objective for the year. The market continues to exude optimism, buoyed by the March Fed interest rate hike, a general sense that we will see some form of relief on the regulatory front and a growing confidence that tax reform of some kind will become a reality this year. These factors, combined with the prospect of additional interest rate hikes over the next 6 to 12 months, is leading to a longer tail of positive sentiment than we've seen in a long time. Although the jury is out on how that may translate to incremental technology spend over time, we are having more conversations about technology focused on digital, commercial services, cyber security and revenue generation, which aligns well with our sources of solution differentiation. Lastly, we continue to be excited about the prospects of bank-based P2P and remain quite active partnering with our clients and EWS to bring Zelle to life later this year. As I said upfront, we're on track to achieve our financial goals for the year and continue to expect internal revenue growth of 4% to 5%. Although we don't provide quarterly guidance, we did give color that the first quarter was likely to be the low point for internal revenue growth for the year. For modeling purposes, given our strong start, we don't expect our Q2 internal revenue growth rate to be higher than that of Q1. As shared previously, we fully expect internal revenue growth acceleration in the second half of the year. We continue to anticipate adjusted earnings per share will grow 14% to 17%, or $5.03 to $5.17 for the year. And adjusted operating margin will expand more than 50 basis points and that free cash flow per share will be at least $5.45 for the full year. In conclusion, we're pleased with our start to the year. We're making progress against our strategic priorities, setting ourselves up to achieve our financial outlook for the year and building momentum towards further growth acceleration in 2018. Investing in tomorrow while delivering results for today is not easy. Thankfully, we have more than 23,000 talented associates who focus their collective energy on creating superior value for clients and shareholders each and every day. With that, operator, let's open the line for questions.

[Operator Instructions] Our first question comes from David Togut from Evercore.

The 30% increase in sales, Jeff, you called out 60% growth in Mobiliti as a driver. Are there any other big drivers behind that? And to what extent you think this elevated level of sales growth is sustainable for the balance of the year?

Yes, that's great. The 60% increase in Mobiliti business sales for the year is a driver of it, but it's not a significant driver. The biggest drivers of sales for the year -- we had a very good quarter in our credit union business. We're making great strides on the digital front, digital including Architect, as I talked about earlier. We had good growth in our biller businesses. We had actually pretty good growth across the board. There were a couple of areas that had a little bit of a slow start because they had -- we had such a strong -- you'll remember, such a strong fourth quarter, and we actually had a pretty darn good third quarter as well. So -- but the pipelines have been growing. Whether or not we can sustain 30% year-over-year-- you'll remember that last year, the first quarter was fairly soft for us. But we do believe we'll have higher sales again this year. And most important, that even the pipeline with higher sales will actually be up going into 2018. So lots of good momentum in the market.

How should we think about the time to convert these new sales into revenue?

Normal -- I would say it's our normal cycles. I mean, you're talking about anywhere between 6 months on the low end but really in the -- call it, in the 9 to 12, 9 to 15-month range.

Got it. And then the big margin expansion in Payments to 32.6%, can you talk about some of the drivers behind that expansion in a little bit more depth? And then to what extent is the 32% to 33% level kind of the new high-water mark?

Yes, David, it's Bob. Overall, obviously, we're pleased with the performance of the business for the quarter. There are a number of things. We talked to a few -- about them in the opening remarks. First off, I'd say we had some nice drop-through rates on our scaled payments platforms. The mix of business was nicely favorable. We talked a little bit about timing of both periodic revenue as well as variable expenses. So the flow within an individual quarter was favorable for us in the first quarter. I would say that we certainly expect the full year to be strong and expect meaningful expansion of our operating margin on a year-over-year basis. I would not expect 270 basis points for the year. But certainly, I'm seeing nice progress both in terms of strong mix and a scalable business as well as good management of expenses. And of course, we're also benefiting from the strong operational effectiveness. You heard for the quarter, we delivered $20 million of savings on a full year expectation of $60 million, so we're off to a good great start there.

David, I would add a couple of things. I mean, this is -- and you know us well so you'll know this is -- this may be our highest margin ever in the Payments segment in the quarter. And to Bob's point, while we don't expect to have 270 basis points, we are at an interesting inflection point where, for the last -- call it, the last 4 quarters for sure but even a little bit before that, we were getting dragged down a bit in this segment on margin due to things like the EMV conversion. And we've got that growth as we start to transition over from having that lower margin revenue go out and the higher margin continuing to build payments and Mobiliti in these ASP solutions that we've been investing in for the last several years, as those are starting to now come online combined with the mitigation of -- I'm sorry, with the moderation of some of the investments in the Payments segment, that we would expect to see the margins really be up into this higher ZIP Code. Again to Bob's point, not as high as they are in this quarter, but we do see the nice, nice tailwind in Payments segment margins certainly throughout this year and going into next year.

Got it. Good to hear. Just a quick final question for me. The 27% free cash flow growth year-over-year in the quarter, that's obviously much higher than your annual guidance for free cash flow growth. I'm a little curious why you're not raising the free cash flow guidance for the year. And to what extent are some of the growth we saw in the first quarter onetime in nature?

Yes. I mean, David, we feel really good about the performance in the quarter. We also recognize that this is the first quarter. We had some positive working capital benefits. And we had been taking a little bit of a hit on working capital the last couple of quarters. And so it's just too early to make that call. We like the start. We'll see where we are in the second quarter, and we'll certainly update you at that stage.

Our next question comes from Dave Koning from Baird.

I was wondering if you can just kind of isolate some of the factors that organic revenue growth, it was a about the strongest, I think, it's been 5 quarters. And it's very, very tight range, obviously. But maybe you could just talk through some of the one-off. I think you said there was a little bit of an early revenue recognition on some product that came through quicker than you thought. And maybe just parse out license and term fees and maybe a little currency impact.

You saw -- multipronged question, David. Overall, obviously a good start. We did see some benefit in the quarter of positive timing, particularly in some license and term fees that came in earlier in the quarter than we had initially anticipated.

Earlier in the year.

Earlier in the year. Q2 into Q1. Certainly like to see the performance in both segments and see the financial benefit -- the Financial segment growing a little bit nicer. Again, we certainly see some timing, and I think Jeff's opening comments, when we reiterated the full year guidance, we talked about Q2 will likely be down below Q1 levels a bit.

So David, let me just add -- let me add a couple of things. So we continue to see really good gains in our transactional businesses, the debit business, P2P. You heard Bob talk about real time. Now arguably, it's on a small base but 300% improvement is still 300% improvement year-over-year. We also ran a program inside the company in the first quarter that we called Fast Start, and that was really about getting people focused on driving revenue early in the year, driving sales earlier in the year so that we could shorten our conversion cycles. And that drove some nice license revenue because our sales -- a lot of our products are license oriented, and so we got a nice start there. And then -- and this is the first quarter in a while that we haven't had much FX. As you know, we don't report constant currency and so we had kind of stabilization in FX. But overall, we feel good about the start to the year, and we feel even better about our guidance for the full year.

Great. And then just one follow-up. You anniversary-ed the ACI and HP acquisition. I know they're not big. I'm just wondering maybe you can talk a little bit how those have been growing and executing and then if there's any margin impact. You talked last year about a little headwind from those 2, and margins are so good right now. I don't know if those are still a headwind or not.

So the HP acquisition anniversary-ed, I think, in January. And I think the ACI acquisition is kind of March-ish. And so that would have still been in the quarter in terms of the kind of no effect on internal revenue growth, and the margin would also be compressed. And those acquisitions, David, did serve to step our margins down. I want to say it was in the 20, 30 basis points in this quarter. And last year, for most of the year, it was in the 30-ish basis point range. So we are growing over that. And while we won't have any compression as it anniversaries, it did serve to put a little bit of pressure on the margin. It's one of the reasons why we feel so much better about our Payments margin. The other thing I would say is as it relates to the acquisitions, the HP acquisition was a big part of the BillMatrix Next technology that we're very enthusiastic about. We're actually going to talk about that at Investor Day. And then I mentioned that we've sold the Architect solution 14 times and have 70 institutions in the pipeline right now all looking at it. We think again that was responsive to the market. So no big revenue growth yet from those solutions but a good momentum.

Yes, and the only -- this is Mark. The only thing I'd add to that is a lot of the cost takeouts, which we talked about when we did those deals, have been kind of -- we're finally getting through some of that work.

We're just at the early stages of starting to feel it.

Our next question comes from Chris Shutler from William Blair.

Maybe just help us reconcile the 2 kind of sales figures you gave. Sales were up 30% but quota attainment up 82%. I'm struggling a bit with whether we should view that as a good result or not.

Yes, Chris. It's -- I tried to allude to it in my remarks. The 30% year-over-year is the actual sales result versus the actual sales result last year. And as you may remember, we had kind of a weaker first quarter. But when we set our quota, we set our quota to expectations for the full year. And so we typically start out a little bit slower relative to quarter -- I'm sorry, relative to quota in Q1. So being at 82%, even though it was much higher than last year, it's still not quite where we expect us to be for the full year. For the full year, we expect to make up those 18 percentage points that we didn't get in Q1. It's not a perfectly straight line. It doesn't perfectly match our sales cycles. So 82% is actually a reasonably good start because it not only reflects the big prior year gain but it reflects our increased expectations for the year. If we get to 100, that's a very good year.

Okay. Got you. Let's see. On the cash flow, obviously a big quarter. It looks like the payable base continued to climb as they have for the last several years. How much more room is there for that story to play out? And I guess do you expect maybe not this year but over the next few years for free cash flow to start to look a little bit more like net income?

Obviously, cash flow is -- well, number one, a very important metric for us; and two, been a very good story. And with our guidance for 2017, we have high expectations and have started out nicely. Part of that is the basic operating performance, so strong net income, and managing that working capital. We saw working capital grow a bit in the second half of last year, particularly in receivables, and saw that come down nicely in Q1, which was a key part of the strong start to the year. We certainly anticipate continuing to manage that number down, both in terms of dollars as well as days. So it's continuing to be an opportunity for us. And certainly, measuring free cash flow as a percent of net income is an important efficiency measure on the performance there.

And Chris, I would expect, I mean, just based on our history, we have a strong history of running above earnings. And there's no reason to believe that won't continue given how we manage our capital outlays as well. I mean, we -- I think over the last decade, maybe we've had 2 -- 2 or 3 years where we've not been above. But we're pretty consistent there.

Okay. Got you. And then lastly at the tax benefit you guys are seeing. If we assume the current stock price, Bob, and can you give some sense of what kind of that total tax benefit associated with stock comp and RSUs would look like over the next several years, I guess, in totality? I'm just trying to figure out what that number would be. And then I think the 34% to 35% range is kind of the normalized tax rate range, right?

Yes. So outside of the change in accounting rules, we would typically, as you said, have a 34% to 35% tax rate. So call it 1.5, 2 points of benefit, which is, for this year, about $0.13 or $0.14. We saw a good start to the -- or a strong performance in the first quarter. That excess tax benefit will vary typically on an annual basis, come in strong in the first quarter of every year given the timing of vesting of those stock options and restricted units. That $0.13 to $0.14 is what we guided to 90 days ago when we gave first guidance. And now with the first quarter behind this, we are continuing to hold that $0.13 to $0.14.

And the other thing I would say is it is difficult to predict with precision what that number will be. To your point, the stock price today is quite different than the stock price was even in the middle of the first quarter. And so we're -- if you said what would -- it would extrapolate out higher now because we would have larger inherent gains in the employee equity portfolio, but you have to try to predict who's going to sell when and things like that. The $0.13, $0.14 -- I think Bob said $0.13, $0.14. I think that's really based on historical performance. I mean, to the extent that the share price moves, right, that probably gets a little bit larger but it's going to be in that range.

There can be some variability to this metric, which is one of the reasons why folks like me don't like having it roll through earnings per share. But given the preponderance of effect occur in the first quarter, and that quarter now being behind us, that $0.13 to $0.14 should be in a very good shape for a full year basis.

Okay. Yes, we're just struggling with how to model is going -- I mean, figure out the valuation impact on all of our companies just given the -- basically trying to take the present value of the tax benefit and then bake in a normalized tax rate.

Our next question comes from James Schneider from Goldman Sachs.

Can you maybe talk about the timing of the deal pipeline as you currently see it? I think, Jeff, you commented that Q2 growth rate wouldn't be higher than Q1. So do you expect all business that slipped into 2017 to still occur in 2017? And maybe give us a sense of how that cadence of revenue growth rolls in, in Q3, Q4.

Sure, sure, Jim. We had made a comment for modeling purposes when we gave guidance, which we don't typically do, but we had anticipated that Q1 would likely be the lowest quarter of the year and that we would see -- generally see sequential increases after that. And that was really twofold. It was what we could see on the periodic revenue front. It was not -- actually 3 reasons. It was not understanding how the new Fast Start program would impact our revenue. And then third, to your point around the ramp of sales and implementations, we -- the only thing that's going on is really the movement of the periodic revenue, as you know, and it doesn't take very much to move our -- I'm sorry, our internal revenue growth percentages. And so we -- just based on what we see right now, we think it's prudent to model to the -- saying that the second quarter will likely not be higher than the first. But there's no change. We still expect the second half of the year to be higher than the first, and we would expect the exit rate to the year to be indicative of where we're going to be in '18.

And then maybe, Jeff, on the broad topic of regulatory reform and relief, you talked in your opening comments about some general effects. But I guess on the positive side, can you broadly talk about the impact that the CHOICE Act, if passed, would have on your business across different aspects? And then maybe on the flip side, on the negative side, can you maybe talk about if there's an ease-up of regulation at banks, whether there will be any trends that you would see that would maybe trend towards less outsourcing of core platforms rather than more?

Yes, let me take the latter piece first. The best we can tell, there is no real -- there's no movement, and I don't see that regulatory reform will do anything other than actually -- I'm sorry, that regulatory itself will do anything other than continue to push technology burden on companies like us. And so even if the -- even if and when the technology -- I'm sorry, the regulatory burden eases a bit, because of the speed in which technology is evolving and the expectations that consumers have and their desire to have their financial institutions deliver faster, more feature-rich experiences, I don't see that having any impact. We are starting to hear a little bit of discussion on things like a hybrid computing, which is a mixture of having institutions run pieces of a platform inside their 4 walls and having us run parts of it outside the 4 walls, but that's a newer trend. The discussions around cloud and all kinds of things like that. So from our perspective, we don't see a lot of risk there. And again, we're developing more and more solutions that -- investing in more and more solutions that feel cloud-esque. And that really is geared also to a lower TCO, and I think that will help. On the notion of CHOICE Act, I mean, my take on that is generally, if you're going to see less regulation, that's going to be a good thing. Right now, Dodd-Frank tend to do -- to provide some protection at the community bank level. We'll have to see how all this plays out. I mean, I think for now, our belief is net-net, regardless of what happens, you're going to see an easing of the implications to banks, not that consumers won't be more protected but just an easing. And that'll be good and hopefully translate to some more value for them and therefore, for us.

Our next question comes from Arvind Ramnani of Pacific Crest Securities.

You have kind of outlined a pretty good picture on kind of your core clients being in better shape, but this regulation and interest rates increased interest in digital. But can you maybe like help us kind of understand what's driving confidence in kind of second half performance? And also potentially, what can drive upside or downside to the second half ramp?

Sure. I mean, one of the beauties and the difficulties of our model is we sell well ahead of the implementations of a technology. And so we have a pretty good eye right now into what will get implemented in each of the, call it, the next 3 to 4 quarters. So that gives us the kind of visibility so that we have some confidence in being able to project what's going to happen. Now the downside to that is our clients are still -- they still have development cues that they have to work through. And clients have to do their share and we have to do our share. So it's not an exact science. But it does give us reasonable visibility. And we have good financial rigor in the company. We learned some lessons last year on some of the challenges that we had. And so we feel confident that we'll see accelerated revenue growth in the second half of the year.

Great. And then just on your Payments -- your faster-growing kind of payment business, are there any specific areas within Payments that could kind of drive kind of structural or secular acceleration in growth? Or do you think that Payments is going to be better? But anything -- any specific levers that can make it grow even faster?

Sure. I mean, the -- in all of those businesses, if you take something like debit growth, I mean, debit is growing nicely. It's growing high single digits. And arguably, debit is, in fact, a secular trend. People are using it. The adoption curves tend to lag in the community banking market from the largest banks, and so we're riding that secular trend. Mobile banking is still very early, and so we would expect that over the next 5 to 7 to 10 years, that mobile banking will be the standard today. About 75% of consumers use online banking, and yet there's only about 40%, 50% using mobile. And so there's a lot of additional opportunity there. And then probably the last one I would point out right now is around -- is P2P. I mean, we have been pushing P2P through our Popmoney solution for the last 4 or 5 years. We are very excited about the Zelle initiative, which is Early Warning, Early Warning systems, large banks and the community banks, many of which are going through us as well as a number of the large banks. And so we think that will go from a very small business. Our current -- currently, most of the pundits are saying that, that could be as big as $300 billion come 2020 in terms of size of P2P market from a very small market today. So early, early stage in what we believe will become a secular trend over time. Those are just a few examples.

Our next question comes from Joseph Foresi of Cantor Fitzgerald.

This is Mike Reid on for Joe. I was looking at the integrated sales growth. That was 7 -- was that 17% last period?

I'm sorry. Would you repeat the question?

The integrated sales growth was 7% this period, down from 17% last period?

Yes, it may have been. We don't really think about it on that basis. The fourth quarter of the year is typically always your biggest quarter there. So 7% sales is pretty good growth. And the dollar value, if you look at the dollar value, that's the most important piece of that. Again, that's integrated into our sales number.

Okay. Got it. And with the number coming in at 20 already on the savings efficiency initiative, should we think of that amount probably coming over again this year as it did last year over the $60 million target? Or will that maybe possibly slow down a little bit?

Yes, some of that benefit is actually that we had a strong second half of last year, and so now that's kind of rolling into the first part of this year. So I mean, not necessarily surprising to have a strong start. It's early in the year so I'm certainly not ready to change that guidance. Some of that is new activity. And we've got a 5-year program we're in year of 2 of it at $60 million this year. At the end of year 2, at the end of this year, we'll be $120 million against the $250 million 5-year goal. So we'll be in great shape.

Our last question comes from Tien-tsin Huang of JPMorgan. Tien-Tsin Huang: Just I guess you had more balanced growth between the 2 segments here, Payments and Financial. Should we expect that type of growth between the 2 for the balance of 2017? Just playing around with the model here. Just trying to think about comps. Anything to call out?

Yes. Actually, you heard a couple of questions and Jeff's answer on the secular trends in the Payments segment. We typically see Payments slightly stronger than our Financial segment. That's been the last couple of years. And I would anticipate that to be again this year. Clearly in the first quarter, it was a bit more balanced. But overall, the trends in the Payments segment are a bit stronger than what we would see in the Financial segment. So the last couple of year trend, I think, will continue this year, by the end of the year.

Although, Tien-tsin, I would say that we do expect higher growth in the Financial segment. I mean, we're not giving guidance to your question. We do expect a little bit more growth in the Financial segment this year given the performance last year and some of the sales and all that. Tien-Tsin Huang: Yes, and that will be the [ tie-up ] which you've been talking about on the call. I guess just as a last question, Jeff, just on the M&A front, I figured I'd ask about your appetite to do acquisitions. There's been a few more deals announced, I guess, in the industry in Q1. I know PayPal was talking about the TIO Network bill payment acquisition earlier. I'm curious if your appetite has changed at all and what we might expect.

Yes, we continue to have the same capital allocation strategy that we have had. We look at a lot. We don't buy very much but we look at a lot. And I do see opportunities for us to get into the market faster by doing some product-oriented acquisitions. So last year, we did the little -- the HPE deal. We did the CFS carveout. We did the OBS acquisition. So I think you'll see us do smaller capability-oriented acquisitions where it makes sense and it's really supportive of our strategy. I do think that's a reasonable use of capital just given how fast the market is moving right now. All right. Thank you, everyone, for joining us this afternoon. We are really looking forward to seeing you at Investor Day on June 20. If you have any questions, please give our team a call. Thanks so much. Have a good night.

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