NATL - Earnings call transcript Q3 2024

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and welcome to the NCR Atleos Third Quarter Earnings Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Brendan Metrano, Head of Investor Relations. Please go ahead.

Brendan Metrano

Good morning, and thank you for joining the NCR Atleos Third Quarter Earnings Call.

call CFO. Tim the and our on Campbell, Paul me today Oliver, are CEO; Joining start morning progress. will and Tim this an quarter of update performance third on strategic with an overview financial Paul with will our a of follow financial results review outlook. and Q&A. move we'll Then to

get our are such These subject remind you started, in These periodic our counterparts this of cause results in include, call and GAAP as and reconciled are to risks of discussions on our may, today uncertainties presentation that often are similar me statements, our and statements differ words could financial measures, current to including beliefs and filings call expectations available described that later forward-looking annual turn of will will, I to Relations to be in uses to non-GAAP website, the actual replay the on materially Investor performance. include company Also, uncertainties will which and our are materials let and reflect report. measure today's from meaning. expressed certain we their risks our review refer to over SEC, its measures With A will and Before that, which website. non-GAAP will we today, and the presentation with results by These Tim. words materials expect, those expectations. described investor.ncratleos.com. the the and

Timothy Oliver

Thank for this Brendan, joining call this you, thank morning. you and everyone to

countries. Veterans, who all We happy you. and to those First, Remembrance served happy happy Armistice a their Day appreciate have belated

against and along $X.X you Atleos. XXXX We that execution on X. financial free Relations $XXX have objectives across over Strong further translated very quarter on in quarter our X I'm billion $X.XX us progress $XXX following pleased million validate into and our cash our for NCR quarter EPS plan. in presentation functions the for and over Investor exceed start third of of months update strategies. EBITDA, from Slide delivered the saw consistent of flow. for businesses results revenue, website, adjusted growth another successful first million make adjusted the to third That generated I'll Now the of those

in, coupled what momentum out in me was date Our year-to-date performance, Reflecting evident close XXXX. company, the businesses, confidence on celebrated just and accomplished ATM-centric over I birthday quarter and team gives employees best the engaged. very our what year energized Atleos an our first overstate with our the will successful the has as independent a are having One year. we to cannot past

Our reinvigorated customers innovation levels a service our to appreciate return and best-in-class efforts. recognize

and is Our strategic per financial steady. performance has and ATM our solid pushing been our revenue progress higher,

those story beneficial think compelling we discussing for results, third it's to Before the focus quarter see I a familiar of our all our quick constituencies, our investors. particular provide on but and description opportunity our for with the of with less company

every our outlook or the are legacy machine locations. and world-class. network generating peer institution pure-play our located gains Atleos, translated more undervalued spin transaction, not own driving in through for yet to and our of company and a comprehensive value. and installed companies, an fueled emerging free ATM customers scale, clients by financial the providing employees, our will is significantly of customers, from communities strategies an both banking, we XX,XXX that including Atleos blue-chip fleet with has support, of we NCR that improve of service our common to that's and hardware, of operate to have we Atleos vectors while now XXX,XXX come a more base global from stable environment ATMs, a installed access flow a strategy cash our self-service financial is our that growth In for and pattern company from and our partners services separating position and Atleos that unmatched customers' growth leadership over these And growth machines own has desire remains compelling relative a enterprise to recognized clear by whether While in efficient service cash-based demonstrate generation. transaction a steady their retail high-quality, their outsourcing infrastructure continues Both network. more more revenue importantly, in approximately cash a performance consumer performance consistent in After and leverageable from strong all in ecosystem. for transactions is across is to more for independent volumes

to banks importance way, self-service continue global the to their cost-effective improve As in most of customers' seek increasing. experience is devices the

banking As retail their a are result, our and back customers footprint financial into utilities. reinvesting shared embracing

consumer better in For reach traffic. them, will and in this foot costs, higher instances, experience, higher lower strategy some quality, broader a result

For our X%. growth, revenue first Through Atleos, cash as a ATM nearly grew revenue higher both We of by XX% and the the we from X%. XXXX, predictable revenue drive scale increased richer network will quarters by free and profitability it higher X machines flow. mix Service ARPU and by grew on revenue service

And led of expectations the on Revenue XXXX. Overall again track coupled We in above third cash left mix, and quarter every transaction-based indirect our separation from significant of So drove solid duplicate margin results flow toward and turning services a expansion was revenue growth strong direct upper transaction. beneficial costs both quarter. to end were was businesses. financial the deliver positive eliminate free in are to cost again. sequential expectations, productivity by and with we profit we strong both costs as or importantly, with our by incremental the that

in will in reductions the through In interest quarter. few successfully our rates based meaningful will in details a improved expense at October, but Paul and reworked better beginning the addition, company's we fourth availability on facilities we profile. in and lower credit refinanced minutes, the credit run see

close cash capability like cycle. efficient hardware what capable and banks low-cost more replacement recycling As and strategy outsource about away the Demand starting traditional of accelerating willingness be our tap demand in to operators also is from financial we XXXX out branches validated. desire for servicing and globally. innings a provides to capable appears And increasing. the early and growing of is or being ATMs that immediate The XXXX, think ATM is to noncore to both shared utilities for coverage bank is

self-service Moving X, banking. to Slide

Third indirect guided led in of our grew strong effective and margin growth EBITDA software revenue coupled services quarter the We growth with segment revenues incremental adjusted initiatives, from mix. a rate base end our top We of savings increased and financial direct revenue ranges. streams beneficial and cost devices. installed with results exceeded line with and by high business EBITDA sequentially recurring

considerable service and execution year, quality go-to-market and and resources and strategy. past recyclers. support committed all in contributed businesses been strategic demand to to the wins to high have to we product The hardware, particularly our our we see to backlog in improvements by the customers regions resulting and Over recognized and the

an Service revenue We annual XX% as solution Service million. ATM grew to in about a as $XXX a quarter the run year-over-year well. ATM rate of progressing is Our

outsource to a of broad across appetite ATM-centric a increasing provider. a to see to singular continue institutions financial services range or all portion We their of

not our very pipeline sales objectives, position also for you backlog a New give only significant more sight and Paul line us customers, XXXX of XXXX, but will well there. active and give for us

our have and Our improved odd very is backlog onboarding to speed. of strong The continues design some quality grow. changes that backlog

with clear.Â First, As at incremental wallet we the is think beyond Atleos. our time. a services about the managed competitors our ATM that But increase services customers of of and as reported opportunity as have Service. a as as see can represents define inaccurate piecemeal migrate a causing opportunity who for for full brand many any ATM at become singular the and a they definition continuum ATM as XXXX as or And our things ATM X tight product Service a over comparisons share that metrics Service,

significantly continued to business are revenue the in not ATM be by allowing or purchased to we signing to a either strategic network in capital but rather and and customer, ATMs our performance Service units, solid with services forward, the broadly, and consistent outright as returns.Â Moving our asset-light expectations. does Slide will The to and improve important sequentially EBITDA intensive. us total Increasingly, are revenue in Going place descriptor deliver strategy with are Network segment. the the already need more quarter where company wins revenue.Â Second, the of not be line up success third X,

response transactions surcharge. transactions more North in and Allpoint the revenue have continued generated locations We and banking branches new the paying transaction uptake new PNC on institution Federal transactions of migration volume financial network.Â We types already fueled volumes consumers both year-over-year Navy machine banking are safe utility generated And continues by at that the strong focused grew third X of markets Deposit Starting for retail we driven in XXXX. key business convenient the and ourselves first the success grew utility approximately high Italy.Â Turning network. trends. with transaction another incremental year, technology view future of discussed focus to that million that for ATM our for bank to ramp Credit Money strong banking highlights is laid on for and over workers reiterates business path retail a so executing of from our international I've also bank XX% the on our to through converging transaction reported tap on a X choose base by to market fixed cardless types financial that in the set for and objectives. We into functionality differentiate to Greece and gig the partnership and the in company-owned One, our Union. Allpoint In our are and strategy already in year-over-year operated both Capital including by U.S., without do and and as quarter.Â Our with high-quality ATMs. in America, transaction a regular activated XX,XXX partnerships, the emerging the banking new XX,XXX from other as strategic X partners home grow. cash success have new their in reinforced prework We extended objectives per customers adding describe X access this driving approximately our our to volumes and international to key to XXX% machines XXXX consumer with objectives models like groundwork Clip quarters to very Ready quarter, up strategies customers growth Last XXXX their how XXXX. adapting operational meet with the demands.Â Conversations enables Slide and many and our of growth expansion like markets, the evolving discussed These into stretch Code we trend. I'd deposits expansion I setting for segments our the

solutions evolving our product of fully capabilities are leverage vertically go-to-market strategy and toward service providing that our rather steps. the unique We than defined selling integrated entirety

from the that under express agreement that will on that forward.Â Concluding our expense, the category focus impact results Atleos my complete. in our at will down from needs agreements have and as comments, quarter. preparation by likely transaction want team another awaits services accomplished is TSAs finding very our returns separating this over to am in added to nearly even meet commitment I separation year-end. a and when NCR for instances, catalyzes partner global the what our goals, growth. tool by going in rollout.Â Lastly, even significant been year-end people, It of for opportunity XXXX. establish A toward extending IT-related Our impressive Fueled been and eventually at right will in I shift of more components, will hardware that, NCR and organization optimizes all the In period responsibility manufacturing and Paul, a NCR activities service improvement the you. efforts year team our of over process of and gratitude for savings our pressure. past the new achieving positive our be of values, around Atleos and no XX,XXX other diligent the segmentation that Voyix my new Atleos and proud future mutual group have full outsourcing prioritization completed. remaining is be our commercial and effort to few of Voyix the XXXX customer members continuous our truncate Most ATM. Diligent company's wind to trusted including to regard will have capital, outsourcing time AI some on has dis-synergies centered With of today application resources, reported enthusiastic extremely formalize and missions consistently the initiatives disposition complete in nearly

Paul Campbell

and all Tim, you us for joining Thank you, thank today.

and progression Slide We revenue will the by consistently consolidated our improvement margin which year. software from on the incremental ability expanded XX.X%. margin of consistency benefits recurring results. each macro of and constant a QX. the growth million services approximately coupled XX% revenue in and and review continuous have was third EBITDA of businesses.Â We labor of start than revenue up Growth ATMs. basis costs the billion, adjusted Recurring XX third dis-synergies, $X.XX quarter delivered this was headwinds. performance in productivity to a XXX streams to the initiatives, currency quarter installed a top more consecutive $XXX margin expected quarter our led generate recurring higher-margin services, an demonstrating basis due of Total year total revenue, of reflecting ongoing and on of revenues, the third sequentially of from year-over-year solid comprised marked and quarter in base EBITDA separation-related higher QX million of XXX,XXX with $XXX this was These Adjusted and transaction points quarter to for stability X% expansion and resulted line offset company our

strong and later us EPS quarter XX.Â Third trends our well the continued business tax in the above expectations, the in $X.XX, the underlying per year will Slide of driven better-than-expected which discuss by quarter. we to rate allowed The revisit third exiting and earnings profits Moving through expectations, quarter our was was which share has QX momentum diluted full lower-than-projected to presentation. EPS

with QX outstanding hardware units. fourth free achieved third Moving comprised payable, accounts services Self-service stable base the to use higher and on global a quarter.Â Moving to XXX,XXX we cash $XX million revenue our inventory in generate recurring business this quarter. have year, XXX,XXX and primarily flow of We which is adjusted with even of largest banking is another third positive example flow capital XX. of and approximately installed for convert our revenue ATM in delivering million working free of chart strong the will from These to a Slide the units XXX,XXX software. $XX the consistency cash right, quarter discretionary of cash for delivered

first model. deliver We more guidance are were million. our year-over-year a range revenue quarter, the The as up by to XX% quarters third software EBITDA, and growth which our in infrastructure transforming X left, associated $XXX strong million. The on leveraging productivity exceeding strong chart network services in Service. software strong and reached this broader our illustrates offset revenues, ranges. the banking $XXX deferral initiatives. to top hardware to by a capabilities and X% driven partially adjusted of of to business growth customers revenue shift Self-service a a grew growth Starting a revenue the revenue the drivers with ATM ATM our high-margin Recurring was comprehensive outsourced by $XXX primary million, trend year-over-year Service as right services upper to for had X% of

improvements Additionally, and adjusted QX.Â As on higher-margin up and through grow trends in faster increased basis margin XXX expense revenue. initiatives, drive continue EBITDA continuous EBITDA since to and we QX points services sequentially basis adjusted margin to than points the focus to XXX continue XX% cost

of for mix approximately revenue up quarter. a Moving trajectory XXX third The the basis to points the of recurring positive the KPIs year-over-year. was slide, bottom this XX% in continue third quarter,

year-over-year, revenue installed up XXth year-over-year revenue.Â Annual recurring consecutive is strategy recurring the our that was in was existing growth more proof point our X% quarter driving revenue of from quarter third recurring another with The progressing. base

XX. to Moving Slide

revenue ATM in as from is within outsourced solution recurring fully results a segment. Service to are self-service XXX% only included Atleos. Our representing These units our services services, banking

a we the key a opportunity, as XX. strategic businesses in of want Service Slide growth achievements quarter to on Given importance the ATM as highlight strategic long-term

for On quarter, a XX% XX%, third represents into new count adoption increased left revenue $XX ATM grew customer as of year-over-year. markets the our million expanded strong XX Service. year-over-year top which a the and to Live ATM the of as slide, we Service continued

are We markets. as ATM XX Service in a now offering

gross to direction with continued right, sequentially, in consistent a the as to is which the the XX% million right $XX.X also third the and of increased profit the in the On KPIs XX% year-over-year a as ATM to revenue.Â Moving Service in move ATM up ramp quarter. Service bottom slide,

in million. On the recurring XX% almost a growing bottom year-over-year third left, quarter, consistent annual $XXX trend continued upward revenue to the

keep in size.Â Our of revenue and of all for to maximize last is margin Service growth a up set customers roll of of important per are us exit to XX,XXX this financial mind product a continue the as quarter lot this variability reached fully is increase of particularly installed for of the measure The and the expect outsourced services approximately of out continued is of a months a at year right, there $X,XXX in the point. or in units healthy and regions largely result increasingly ATM target believe that build increasing of year. XXXX. Demand KPI to ARPU would in fleet to adding XX operations will higher-yield between X,XXX have of unit institution and bottom expect with services which referenced have will more and the previous a units we to outsource institutions unit, to the broad-based model across move their ATM we North from dialogue during customers to focus and type, the to unit, expand average the live backlog rather majority in America, us. as units. and approximately that Service singular revenue the third is to the customers with per regions in that expansion a outsourced our is included, units full On perform cause ARPU, that That geography, to said, number than ARPU some an $X,XXX become we base It that to mix signed a our base.Â Our ATM

Moving to the segment XX. Slide Network on

of banking access on Our industry-leading scale network and owned our ATM partners operated to financial focused strategy institutions and the network. utility offering retail

We transactions base strong our of driving the of higher unit another top million. Network increased number are on XX,XXX segment progressively and per ATMs, had the a revenue users increasing of approximately of types revenue quarter. unit.Â The left, X% to sequentially $XXX Starting

network. fleet, and continue to driven international ATM adding XX% on up execute Also America deposit third drive our small deposit to we transactions transactions. continue Xx note, new with volumes top-tier approximately volumes to withdrawal our are for to and year-over-year. Ready a our base. X% Withdrawal of Code volumes We seeing North a U.S. which again incremental Deposit use over albeit our sequentially, product QX, to increasing for XX% cases continue growing strategy bank transactions increasing has from increased XXX% X% a by nationwide from for accelerate, base.Â We year-over-year small

slide X% units. transactions margin On through strategy the strategy. strong managed $XXX The key guidance of our end EBITDA of on remained XX%, was the our EBITDA of the our highlight validity metrics high and to our higher-margin also existing execution at and increased of the success million the bottom right, drive of adjusted the at sequentially. reflecting Adjusted range

right, units. finished months can quarter.Â On the in you per units. the X% up XX The was quarter revenue On at our left unit year-over-year XX,XXX portfolio see the the ATM the last third approximately shows average impact usually partners slight closing also has customers decrease are count our our nearby our stores, low-performing is a low-volume This other due negligible on visit as unit locations. which pharmacy revenue in to

unit transaction volumes continue the earlier, the highs base. despite reach discussed all-time As to reduction small in

by product of to clients in XX, from maximizing of a in this software provide Success We the geographies. the company.Â The trends attaching increase XXXX we progress and results units unit will transactions, unit On Slide in and assess by help to transactional of is expect model of be the this the software. in and our ATM view new lines. each in key trending fleet growth takeaway addition through of and investors product-centric more services, monetization evidenced services XXX,XXX executing and number

segment Atleos agreements the between a other and legacy geographies As Voyix. commercial reminder, represents exited Voyix and

position to $XX non-core snapshot segment. expected the transit revenue We in cash payable expect of the quarter, quarter of support at a results fourth million. To end cash XX, The we flow free financial On a use present third a of decline flow of the slide third for million key breakdown the is that we fourth of to source the and this inventory cash QX. and be business year-to-date on inventory approximately at for takeaway and continue cash This of Slide in hardware end quarter. quarter. this free of generated of we had will a $XXX in the in higher on accounts our

and On net X.Xx. down $XX the the to million net bottom by year-to-date, dropped approximately from of X.Xx debt ratio our leverage slide, is

were XXXX. on in also in very Loan This lower performance us consistent our and of A over B. credit lenders profile improved rates. additional the We at cooperative we to quarter. the Term acknowledged Slide free facilities we raise comfortably support and interest $XXX refinancing an that flow of past Loan October $XXX meaningful financial and liquidity a third company's to than have our in the credit refinancing will million the Based that fundamentals expensive XXXX million and and transaction more pay year, down investors savings flow consistent highlight strong The debt.Â On more incremental can our cash and of debt XX, to generation executed current translate strong end our Term credit allowed cash ample at

average SOFR for annual of approximately of million as have by X our liquidity percentage indebtedness, adding point savings by to estimated reduced used capacity, which these the spread revolving addition, an facility changes In we view $XX and we credit position improved to approximately $XXX current powder. the level million. weighted not dry our At

company we be fully per the outlook earnings total Slide our to range $X.XX. from expect XX Turning and up non-GAAP full for midpoint the of $X.XX, year guided now diluted approximately financial previous XXXX, share to

strategic For made at year. our guidance consecutive guidance transactional, that, in reaffirmed we great XX, of revenue free a We full cash flow, comments We EBITDA ranges. turn with record emphasized to our EBITDA. we proven the my delivered and in With revenue, set the initiatives, have at objectives the it adjusted progress our and third our and or for quarter for cost-saving above and we raised Slide our full growth previous and EPS guidance, operational midpoint a adjusted stage software guidance Concluding affirm I'll and services on revenue. non-GAAP the demonstrated successful questions. adjusted year operator back track

Operator

from question Davidson. Summerville first is The Matt D.A. instructions] with [Operator

Matt Summerville

A couple of questions.

should XXXX, guidance, to free you relative had free that you Given don't have then a to of profile follow-up. free free expectations soft cash maybe at in increasingly -- flow interest Service ability cash maybe realizing that cash thinking ago. will, asset-light a the And probably will, you next cash be about conversion, profile business think is look, you you if if ATM year? the expense want tailwinds flow but when as a company's about flow, have How set just give I some we to a cash and the lower year I full

Timothy Oliver

Yes. Thanks, Matt.

'XX. And close started out is we're We've the right. for a the exactly little of XXXX. XXXX. is here it our grinding in planning We're -- Your process early analysis for

in think this year free X% about business one, to thing We the if we so same cash be different than grew from quickly down the growth walk generated I this think next to right? way XXXX, another that. expect and flow more very We way to core all about year would profitability X% the our not year.

cash more something to double you of think EBITDA I for in X% like described. in rate year, of EBITDA rate the conversion growth then growth a a EBITDA flow than much that XX% and to terms next in reasons free higher expect just should you

number a higher right, in if apply think much be in I XX% a which cash number a to conversion much factor, free respectable you a suggests you'd than number flow but XXXX, higher XXXX XXXX. close in

Matt Summerville

or And is I'm head, path, if a then lines, doing Tim, envelope along at a to repurchases to become quick just net more Board exit probably a deployment at levered those the expect about the my of we price. $XX if can the active share When on start back Atleos year thinking you're X.Xx how stock times so to math firm from capital very in standpoint?

Paul Campbell

I this year. We'll clarify, the probably question. to X.Xx, around to next below probably of targeting to we're get just Matt, midpoint Xx Tim the X.Xx. year exit to think around for pass not I'll

Matt Summerville

I apologize. at was doing I math... referring X.Xx, year next just to exiting around quick

Paul Campbell

to... wanted Matt, I Sorry,

Timothy Oliver

think equity to on time, more of think, very absolute us that that next. get made is conversation what our Xx it our midpoint returning that with, ask excited We if generate the of Here's clear or way to currently, with shareholders, debt flow, and concur you the And let's best even We're is they cash the to free buy they're them, levered be shareholders, point, and very it being our The year, and fair way about our our say. back. levered, At I The and the next less holders. last shares about under -- cash on both deployment our for we I we have debt delever in point do. year. return about be way conversation to undervalued. me, the that good say, to it's opportunity that point, reduction right with I'd Xx would to of dollar to Board pleased cash would every to a When or I no-brainer. very generate the getting we to our of ability to thing had cash flow to me, is this

Operator

question from next Stifel. with The Shlomo is Rosenbaum

Shlomo Rosenbaum

had last of Tim, the little now might were cycle? talk like bit strong further bit little earlier in And bit. forward Maybe the Were refresh the little bit commentary. thinking in but a any cycle, cycle. where talk hardware you performance of the a some little It you self-service think be lot you there in that could a positive had quarter, banking pull a a seemed we commentary into Like we're you quarter? you like in you we could just are about the sounded the about in the sales?

Timothy Oliver

Yes.

be take place So of above XXXX that. that anything the XX% any cycle have anticipate the you from the significant what volumes, follow-on We of our or in right, or saw to may don't effect, refresh trend to anticipated XX% hardware like us be changes the would that's have going average rate. some would tune

are lapping out X machines X those machines. are years. to at We now Those aging

And be them several won't single a next time. get over period see It so you'll year take place event. over of a It the will years. replaced

bank But growth. next and be base. But make proportion better the a hardware revenue hardware tremendous much that that saw I likely are is refresh cycle. to of I do of that larger think which be earlier of bit probably a contributor hardware We orders script our contributor some growth in said innings I typically. year, revenue. my lift will do from 'XX bigger think anticipate expect little of hitting up the that. expectations don't -- XXXX. higher, much a to that not above early think does case seeing that in our I to actually Remember, it's We customers suggest total a we're they're hardware I in in 'XX, I

is outperformance -- entirely year our growth business. our is service entirely growth, by which at importantly, network almost expectations, revenue Our by and driven and driven by the is above this outsized

Shlomo Rosenbaum

be just in covers a are think, over down? more Okay. to -- Is story one as would what's ARPU about that of opposed there's continuum Maybe you're become what's I to us that is as you deals? you a just kind a could geographies to lower could at of and little revenue that hey, And there? then it ARPU, it's I going you why look look asset-light metric. going as mix I is of that give little And ATM the service. you of Is mix of happening a getting Because a is that bit if behind LTM geographies? the But on due sequentially. initially, higher if beneath into know a asset-light clue wanted -- positive. a know, you at know saying that declined it to the talk that could bit

Paul Campbell

Yes, question, me imperfect that because take base of Shlomo, small. of is is in you there let bit The an a the ARPU little don't if mind. so measure

in the of units the we're number So counting ending calculating ARPU.

unit, unit virtually be but last the it day put we a the if So no for on there'll as quarter, counts a revenue it. of

backlog increase a the it our of time. to full unit basis the It's particularly majority the ARPU takes on America. a We're expecting in only numerator. the in of So steadily actual quarter ARPU denominator, North higher is the the in because piece revenue but normalized regions,

expect we'll to continue then QX go in forward. So to going up the ARPU and go up

have would ARPU the units base Just a the then depending quarter, batch impact of just timing we if end of the deployed big it size. the because a on at of

Timothy Oliver

year-over-year ARPU at we great XX metric, way is that headed. yes. feel about the is look where to So a And rolling better

it's If machine you revenue. ARPUs think between full in States, the a about United a or annual in India spread the X or It's fivefold X function machine and dramatically the different. in

And Paul backlog. strong really upward And metric described, a as that we've pressure so importantly, the got on is terrific.

the X,XXX will ARPU of above I backlog have think we in And well the $X,XXX. the next that backlog probably as enter has totality we an machines year. is

really So that should be helpful.

Paul Campbell

Yes.

context, the ARPU roughly today in is backlog or give just $XX,XXX So our above.

that we increase. to So expect

Shlomo Rosenbaum

just then it could the noted over one of Just over they're India. of some your reentering APAC Is there, is if last there? Okay. might you're APAC? just competitive that something in Is And there pricing some including countries dynamics sneak And of any some I the Great. Diebold in. pressure that change causing of noticing? in one be what one, that

Timothy Oliver

No.

than total the as so So a hardware ATM weighted an component pricing life to we've service heavily isn't India, pressure. the more component. cycle service the a cost much pressure of much In seen pricing is hardware pricing to the pressure

really long not And same for pricing XX% robust. are a is the very relatively think, the space. putting any seen we've between a And competitors always globally, major really that pressure. had long been but players in It's change the it's an behavior our I time. by time, been primary X for We've that so well. price sets share product in competed servicing the always it's players, We've

don't I so And anticipate any changes there.

Operator

The next Tong from Goldman question with George is Sachs.

Keen Fai Tong

to You do any units or or have as internal previously on And you growth, that dollars share revenue, targets now growth had ATM around a absolute as you're more revenue trajectory? more ATM longer-term a focused targets Service mix units. for either deemphasizing Service ATM-as-a-Service

Timothy Oliver

along metrics growing only units we'll that any We we've X,XXX that a our we already yet. some for give for backlog But describe on way. for We either first XX% and modeled insight is The way XXXX, year-to-date you those have will then ARPU guidance and $XXX business units help to given increasing, we since gave is currently of guidance that you in not will. that's model high-value next continue XXXX year. million of that guidance give revenue

Keen Fai Tong

as you it. preferring of their they what want and Got hardware ATM And are transaction well? Okay. about light outsource types hardware a then can own in why their own Service more to bit customers as not would an a to talk little

Timothy Oliver

revenue fleets a our machines pricing into it's I cost And place, lower is build as us. who most and and outcome already for our think folks to sense who apparent of it's large in capital less of us, devices for a likely of to for better is of XXX Service importantly, at some ours. We've well.Â So as cost the bunch. for pretty devices in it us and more adding and own us a larger us, lucrative that already the those fallen to of economic they to bank any new machines, than think in has would the deal I had We countries good continue us to doesn't the either that's a more even their an machines. them. be put installed tend to make capital smaller in situations, be machines prefer it's more folks generated success deals they're Service very It's ATMs, by and as that's replacing far of already customers to investment for for but our much own a aggregate thought most smaller or for place own them ATM than likely that bank who, the time ATM or to machine own in

do And to it. happy so we're

Operator

Chris Research. next Wolfe with Senyek from question The is

Christopher Senyek

going it past Or about should for some nice little at Investor some at XXXX. be margin incremental Solid indicative should quarters good out Are thinking of the had X margins And thinking had about we quarter. differently? You've future? you forward? margin How EBITDA be roadshow the bit the year-to-date. expansion we Day, there a targets

Timothy Oliver

this that came we Remember Yes. into year.

NCR, a we and If this performing the to in bunch you is this with XXs because go at back to separation. of business margin added rate legacy associated XX% we a started closer year costs the

in that the quarter, I So you've rate to that's trying the organizations margin going XX% functional and you year. have as exit fourth Across service we margin rate X And year, X modeling seen about the running organizations think improve. do essence, the for we're you're a to if separate.

closer get productivity. took at. leaning I team great we to feel have driving quite his hard this us what through say got real here, have And money on back continuous dis-synergy a and on tools is to I'd year, a So that's is costs costs. keep year, to costs. bit culture against organization about on margin things and we go and which higher. high generate a rate service of the progress to be And where to money From rate, those some to we It thought costs further AI improvement a the higher.Â Our direct we're and enough. year. to it and saved entered not margin Len It margin we're where other indirect needs needs those working we

doing in I in we and go incremental think on takeout leaning simplify can our around a make with direct cost where model next year, improvements and we heavily the some only sure return. as business places business we're fair we're make the indirect world

trend said, X% if that you and I as margin that EBITDA, expansion XXXX I or no think rate, to nice think you shouldn't to reason margin growth X% about probably in next think about in a think year yet continue. implies I there's that, in and XX% rate again, in growth So revenue X% believe

Christopher Senyek

more. Great. Okay. one And then

a quicker to would year plus of the ultimately that longer to time. I In kind terms to of recurring make think revenue XX% that you target? mix, it's there a longer-term changed little in take know can Has going over you get get bit that goal there's or to anything get

Paul Campbell

store Most space. the I think track. growth has revenue come of growth. We're we're still deliver on our on track in recurring to that

Operator

There question Matt Summerville follow-up a from with is D.A. Davidson.

Matt Summerville

I or a And ones. The of I a from additional that quick me service like point guess, then B, follow-up. will. difference. funnel? unit the $X,XXX a reported as will sort XX then here versus, into have unit. you a just from the big think And backlog if at a sitting Two where Help A that you look to ARPU point in roughly where That's ARPU inbound bridge I $XX,XXX

Paul Campbell

me Yes, that let you. Matt, answer for

India. to portion a is base, geographies ARPU installed big was first ATM the service. India in as go the of So of base a one the there's our

got So backlog also the not net the type. U.K. type product in new North there a a lot has differential deals larger is It good mix that in ARPU a deals, And There's those The in deals. lot of differential, we've a it's American price a et of of has of deals. Matt. also Santander, a cetera. of with mix asset-light the ARPU

lot And by is service varies backlog of dispensers. A of a backlog our even cash lot multifunction recycling a is and dispensers it our cash our ITMs. is units base installed of So and type. units, lot

a that we've answers Matt? cash services dispensers.Â Does of the the question, So got rich it are services your stack multifunction relative to included, depends what on units

Matt Summerville

did. you Yes,

go-forward As the business, I be cash cost thinking from network seen on about should the we've few look how rate we and the your of at what Fed curve last months? over the based

Paul Campbell

rate rate in forward just we Because out you the the the because a more not derivative exposure than time. Matt, that that Yes, complex it's of curve. even swaps potential over space, interest think bit that's little do

smooths interest forward debt, if in in out the because point avoid our network flows to in we it rate swap down directly a layer space, goes through buffer. So any really it contracts

good cost opposite effect flow there. cost that debt the And cost through year-on-year, $X.X it then -- on 'XX, which refinanced, a billion. down, full debt, will cash our headwind flow-through anticipate variable us into be as it the the be of goods opposite. will a become And for about XXXX. portion in to directly tailwind.Â It We've we 'XX, give get goes slight will which will our of a is So will will we be as the SOFR

Operator

any time. There are no further or Oliver, will questions at I conference this the Tim for turn additional to remarks. closing CEO, back

Timothy Oliver

year. We far, Thanks. we're had you again thus to to appreciate able and the most we've have questions, to been those We the talk answer glad all new won't until them.

to time. great hard everybody. We're close out have safe momentum. out going Stay good We're to completion a so going to the of XXXX. about there, to holidays, happy about that year and where be and firstly, feel it you in into So days carry here. here talk we'll We from we're work importantly, XX and XXXX, first successful going a good a back to or

soon. talk and So much, thank we'll very you

Operator

This today's you Thank your participation. concludes call. for

You disconnect. now may

NCR Atleos (NATL) 13 Nov 242024 Q3 Earnings call transcript