Dreamstime
shares are trading higher in late trading on Tuesday after the maker of automated teller machines and point-of-sale systems posted better-than-expected first-quarter profits.
For the quarter, NCR (ticker: NCR) reported revenue of $1.54 billion, up 3% from a year ago and in line with Street estimates. Non-GAAP profits were $1.51 a share, ahead of consensus estimates at $1.47 a share. On a GAAP basis, the company earned 19 cents a share. Non-GAAP gross margin expanded to 27.5% from 26.9%.
NCR stock in late trading is up 5.1%, at $44.44.
“Our first quarter results represent a great start to the year with increased momentum in our shift to NCR-as-a-Service,” CEO
Michael Hayford
said in a statement. “Our performance included strong recurring revenue growth, margin expansion and cash flow generation. We are benefiting from the successful execution of our strategy and are a stronger company than we were a year ago.”
NCR said revenue from its banking segment was $756 million, down 1% from a year ago, which the company attributed to lower ATM hardware sales, partially offset by higher software and services revenue. Retail segment revenue grew 13% to $532 million, driven in part by growth in self-checkout systems. Hospitality sector revenue was $179 million, up 6%, with growth in both point-of-sale systems and related services.
For the June quarter, NCR sees revenue up 9% to 10% from a year ago, which implies $1.62 billion at the top of the range, ahead of the Street consensus of $1.57 billion. The company expects free cash flow in the June quarter to be flat with the March-quarter level of $98 million. It expects adjusted Ebitda (earnings before interest, taxes, depreciation, and amortization) margin for the quarter to be north of 16%, which would be similar to the March-quarter level of 16.7%. Adjusted Ebitda in the March quarter was $258 million.
Write to Eric J. Savitz at eric.savitz@barrons.com
