UPDATE 2-Fiserv posts higher Q3 profit, narrows '09 forecast

* Q3 EPS $0.74 vs $0.48 last yr

* Q3 adj EPS from cont ops $0.92

* Q3 revenue falls 4 pct to $992 mln

* Narrows '09 view adj EPS from cont ops to $3.63-$3.68

* Shares fall 4 pct after the bell (Adds conference call details, analyst comments, background)

By Brenton Cordeiro

BANGALORE, Oct 27 (Reuters) - Fiserv Inc (FISV.O), a provider of IT services and systems to the financial services sector, reported a 47 percent rise in quarterly profit, helped mainly by a drop in expenses.

Fiserv also trimmed its full-year outlook for adjusted earnings per share from continuing operations to $3.63 to $3.68, from its prior view of between $3.61 and $3.75.

The company expects adjusted internal revenue growth in the fourth quarter to be in a range of 0 to 2 percent.

"Revenue growth continues to be impacted by lower discretionary spending by our clients leading to decreased license fees and fewer add-on product sales," Chief Financial Officer Thomas Hirsch said on a conference call with analysts.

For the latest third quarter, net profit rose to $115 million, or 74 cents a share, from $78 million, or 48 cents a share, a year earlier.

Adjusted earnings from continuing operations were up 14 percent at 92 cents a share, Fiserv said in a statement.

However, total revenue fell 4 percent to $992 million.

Analysts on average were looking for a profit of 92 cents a share, on revenue of $1.05 billion, according to Thomson Reuters I/B/E/S.

Payment processors like Fiserv, Fidelity National Information Services Inc (FIS.N) and Jack Henry & Associates Inc (JKHY.O) primarily provide IT services and systems that enable banks and financial companies to carry out day-to-day operations.

The payment processor space has recently witnessed some consolidation, including Fidelity National's acquisition of Metavante Technologies Inc to create the world's largest provider of integrated payment and financial processing services. "They have really only been formally together for about a month and so I think we are waiting as everyone else is to get a more clear indication of what they are going to do," Chief Executive Jeffery Yabuki said on the call.

Analyst John Kraft of DA Davidson & Co said Fiserv could use the merger as an opportunity to steal market share from Fidelity National.

"Metavante and Fidelity are planning on some massive cost-cutting and inevitably some of that will hit some of the clients, so in some respects, Fiserv has an opportunity to pick up disgruntled customers," Kraft said.

Shares of the company fell 4 percent in trading after the bell. They closed at $49.08 Tuesday on Nasdaq. (Reporting by Brenton Cordeiro; Editing by Gopakumar Warrier)