NCR Atleos Corporation Reports Strong First Quarter 2024 Results
NCR Atleos (NYSE: NATL) reported its Q1 2024 financial results, highlighting a strong start to the year with revenues of $1.05 billion, up 6% YoY, and recurring revenues reaching a record $763 million, a 7% increase.
Adjusted EBITDA grew by 11% to $162 million, and the company achieved an adjusted free cash flow of $69 million. Despite a GAAP net loss of $8 million and a diluted loss per share of $0.11, the non-GAAP diluted earnings per share stood at $0.41.
Self-service banking and network segments saw solid performance, with revenue increases of 4% and 3%, respectively. The company reaffirmed its full-year guidance, projecting revenues between $4.20-$4.40 billion and adjusted EBITDA of $770-$800 million.
The reaffirmation of the 2024 financial targets and the issuance of Q2 guidance underscore the company's optimistic outlook, driven by market-leading solutions in self-service banking and a vast ATM network.
- Revenue increased by 6% YoY to $1.05 billion.
- Recurring revenue grew by 7% to a record $763 million.
- Adjusted EBITDA grew by 11% YoY to $162 million.
- Adjusted free cash flow was $69 million.
- Revenue from self-service banking segment increased by 4%.
- Network segment revenue grew by 3%.
- Company reaffirmed full-year 2024 guidance with revenue targets between $4.20-$4.40 billion.
- Q2 2024 revenue guidance set at $1.06-$1.09 billion.
- Non-GAAP fully diluted EPS was $0.41, indicating profitability on a non-GAAP basis.
- GAAP net loss of $8 million for Q1 2024.
- GAAP fully diluted loss per share of $0.11.
- Gross profit rate decreased to 21.0% from 22.3% YoY.
- Adjusted gross profit rate decreased to 23.2% from 24.3% YoY.
- Self-service banking adjusted EBITDA margin declined to 21.3% from 22.9% YoY.
- T&T segment adjusted EBITDA margin decreased slightly to 19.6%.
Insights
NCR Atleos reported robust first-quarter financial results with revenue growth of
The reaffirmation of full-year guidance, along with the issuance of second-quarter targets, underscores management's confidence in sustaining growth. The company expects Q2 revenue between
From an investor's perspective, the growth in revenue and adjusted EBITDA, coupled with strong operational cash flows, indicate a healthy trajectory. The focus on self-service banking and the efficiency of their ATM network align well with current market trends towards digital transformation in banking.
The increase in revenue and adjusted EBITDA reflects Atleos' strong market position and operational efficiency. The company's leadership in self-service banking and the largest, most efficient ATM network globally are key differentiators. The
The slight decline in adjusted gross profit margin from
Understanding the market trends, Atleos appears well-positioned to capitalize on the ongoing digital transformation in the banking sector. The strong start to the year and the positive guidance for the next quarter signal to investors a promising outlook, provided the company continues to manage operational efficiency and market expansion effectively.
Atleos' significant presence in the self-service banking sector highlights its role in the digital evolution of financial services. The increase in global withdrawal transactions and services revenue indicates a growing reliance on automated banking solutions, aligning with the industry's shift towards digital and self-service options. This trend likely benefits from consumer preferences for convenience and operational efficiency in financial transactions.
The company's strategic initiatives and market-leading solutions position it to continue driving innovation in banking technology. However, the tech industry is subject to rapid changes and Atleos must continually innovate to maintain its competitive edge. The focus on enhancing ATM network efficiency and expanding digital transaction capabilities could provide long-term benefits, but substantial ongoing investment in technology and infrastructure will be necessary to keep pace with competitors and technological advancements.
- Strong start to 2024 with financial results at or above the high-end of first quarter guidance
-
Revenue grew
6% year-over-year to$1.05 billion 7% to a record$763 million -
Adjusted EBITDA grew
11% year-over-year to$162 million $69 million -
GAAP net loss of
$8 million $148 million -
GAAP fully diluted loss per share of
$0.11 $0.41 - Company reaffirms full year 2024 guidance; Issues second quarter guidance
“The first quarter of 2024 marked our first full quarter as a separate company and an excellent start to 2024. Financial results were ahead of our projections and our operational execution was outstanding. Our market leading solutions for self-service banking continue to gain appeal with banks, retailers, and their customers, and drove solid top line growth in the quarter. First quarter growth was paced by double digit growth in global withdrawal transactions and strong growth in services revenue,” said Tim Oliver, President and Chief Executive Officer.
Mr. Oliver continued, “Considering the momentum in our businesses, progress on key strategic initiatives, and continued favorable market dynamics for our solutions, we reaffirm our previously published 2024 financial targets. Going forward, Atleos stands ready with its leading position in self-service banking and the largest and most efficient ATM network in the world to advance the transformation of retail banking and facilitate digital to physical transactions for everyone, everywhere.”
First Quarter 2024 Operating Results
The core business segments continue to deliver strong results:
-
First quarter revenue was
$1.05 billion $763 million $986 million $710 million
-
First quarter gross profit was
$221 million 21.0% on a GAAP basis, compared to$220 million 22.3% , respectively, in the prior year period. First quarter adjusted gross profit (non-GAAP) was$244 million 23.2% , compared to$240 million 24.3% , respectively, in the prior year period.
-
First quarter income from operations was
$72 million $66 million $116 million $112 million
-
First quarter net loss attributable to Atleos was
$8 million $36 million
-
First quarter Adjusted EBITDA was
$162 million $146 million
(1) Adjusted free cash flow-unrestricted, as defined in the section entitled "Non-GAAP Financial Measures" |
NCR ATLEOS CORPORATION |
||||||||||
REVENUE AND ADJUSTED EBITDA SUMMARY |
||||||||||
(Unaudited) |
||||||||||
(in millions) |
||||||||||
|
For the Periods Ended March 31 |
|||||||||
|
Three Months |
|||||||||
|
2024 |
|
2023 |
|
% Change |
|||||
Revenue by segment |
|
|
|
|
|
|||||
Self-Service Banking |
$ |
628 |
|
|
$ |
606 |
|
|
4 |
% |
Network |
|
310 |
|
|
|
300 |
|
|
3 |
% |
T&T |
|
51 |
|
|
|
50 |
|
|
2 |
% |
Total segment revenue |
|
989 |
|
|
|
956 |
|
|
3 |
% |
Other (1) |
|
61 |
|
|
|
30 |
|
|
103 |
% |
Consolidated revenue |
$ |
1,050 |
|
|
$ |
986 |
|
|
6 |
% |
|
|
|
|
|
|
|||||
Adjusted EBITDA by segment |
|
|
|
|
|
|||||
Self-Service Banking |
$ |
134 |
|
|
$ |
139 |
|
|
(4 |
)% |
Self-Service Banking Adjusted EBITDA margin % |
|
21.3 |
% |
|
|
22.9 |
% |
|
|
|
Network |
|
86 |
|
|
|
75 |
|
|
15 |
% |
Network Adjusted EBITDA margin % |
|
27.7 |
% |
|
|
25.0 |
% |
|
|
|
T&T |
|
10 |
|
|
|
10 |
|
|
— |
% |
T&T Adjusted EBITDA margin % |
|
19.6 |
% |
|
|
20.0 |
% |
|
|
|
Other (1) |
|
4 |
|
|
|
10 |
|
|
(60 |
)% |
Corporate (2) |
|
(72 |
) |
|
|
(88 |
) |
|
(18 |
)% |
Total Adjusted EBITDA |
$ |
162 |
|
|
$ |
146 |
|
|
11 |
% |
Total Adjusted EBITDA margin % |
|
15.4 |
% |
|
|
14.8 |
% |
|
|
|
(1) |
Other represents certain other immaterial business operations, including commerce-related operations in countries that Voyix exited that are aligned to Atleos, that do not represent a reportable segment. For periods after the separation from Voyix, Other also includes revenues from commercial agreements with Voyix. |
(2) |
Corporate includes income and expenses related to corporate functions and, for periods prior to the separation from Voyix, certain allocations from Voyix that were not specifically attributable to an individual reportable segment. |
Notes to Investors
On October 16, 2023, NCR Atleos Corporation (“Atleos”, the “Company”, “we” or “us”) became a standalone publicly traded company, and its financial statements are now presented on a consolidated basis. Prior to the separation from NCR Voyix Corporation (“NCR” or “Voyix”), the Company’s historical combined financial statements were prepared on a standalone carve-out basis and were derived from Voyix’s consolidated financial statements and accounting records. Therefore, financial results for the three month periods ended March 31, 2024 and 2023 may not be meaningfully comparable.
In this release, we use certain non-GAAP measures. These non-GAAP measures include “Adjusted EBITDA,” and others with the words “non-GAAP” in their titles. These non-GAAP measures are listed, described and reconciled to their most directly comparable GAAP measures under the heading “Non-GAAP Financial Measures” later in this release.
With respect to our Adjusted EBITDA, adjusted free cash flow-unrestricted and non-GAAP diluted earnings per share guidance, we do not provide a reconciliation of the respective GAAP measures because we are not able to predict with reasonable certainty the reconciling items that may affect the GAAP net income, GAAP cash flow from operating activities and GAAP diluted earnings per share without unreasonable effort. The reconciling items are primarily the future impact of special tax items, capital structure transactions, restructuring, pension mark-to-market transactions, acquisitions or divestitures, or other events. These reconciling items are uncertain, depend on various factors and could significantly impact, either individually or in the aggregate, the GAAP measures. Refer to the heading “Non-GAAP Financial Measures” for additional information regarding our use of non-GAAP financial measures.
Second Quarter and Full Year 2024 Guidance
Consolidated |
Q2 2024 Targets |
FY 2024 Targets (Reaffirmed) |
Revenue |
|
|
Adjusted EBITDA |
|
|
Non-GAAP Diluted EPS |
|
|
Adjusted free cash flow-unrestricted |
|
|
(1) Incorporates consensus forward SOFR rates for the year as of April 30, 2024.
2024 First Quarter Earnings Conference Call
A conference call is scheduled for May 14, 2024 at 8:30 a.m. Eastern Time to discuss the first quarter 2024 results. Access to the conference call and accompanying slides, as well as a replay of the call, are available on Atleos’ web site at http://investor.ncratleos.com. Additionally, the live call can be accessed by dialing 800-753-0725 (
More information on Atleos’ first quarter earnings, including additional financial information and analysis, is available on Atleos’ Investor Relations website at https://investor.ncratleos.com/.
About Atleos
Atleos (NYSE: NATL) is a leader in expanding self-service financial access, with industry-leading ATM expertise and experience, unrivalled operational scale including the largest independently-owned ATM network, always-on global services and constant innovation. Atleos improves operational efficiency for financial institutions, drives footfall for retailers and enables digital-first financial self-service experiences for consumers. Atleos is headquartered in
Web site: https://www.ncratleos.com
X (Twitter): https://twitter.com/ncratleos
Facebook: https://www.facebook.com/Atleos.NCR/
LinkedIn: https://www.linkedin.com/company/ncratleos
YouTube: https://www.youtube.com/@ncratleos
Instagram: https://www.instagram.com/ncratleos/
Cautionary Statements
This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 (the “Act”). Forward-looking statements use words such as “expect,” “anticipate,” “outlook,” “intend,” “plan,” “confident,” “believe,” “will,” “should,” “would,” “potential,” “positioning,” “proposed,” “planned,” “objective,” “likely,” “could,” “may,” and words of similar meaning, as well as other words or expressions referencing future events, conditions or circumstances. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Act. Statements that describe or relate to Atleos’ plans, goals, intentions, strategies, or financial outlook, and statements that do not relate to historical or current fact, are examples of forward-looking statements. Examples of forward-looking statements in this release include, without limitation, statements regarding: our expectations of demand for our solutions and execution and the impact thereof on our financial results and our intention to focus our resources on meeting our ATM customers’ needs and extending our leadership position in digital-to-physical transactions following the spin-off. Forward-looking statements are based on our current beliefs, expectations and assumptions, which may not prove to be accurate, and involve a number of known and unknown risks and uncertainties, many of which are out of Atleos’ control. Forward-looking statements are not guarantees of future performance, and there are a number of important factors that could cause actual outcomes and results to differ materially from the results contemplated by such forward-looking statements, including those factors relating to:
- Strategy and Technology: transforming our business model, development and introduction of new solutions; competition in the technology industry, integration of acquisitions and management of alliance activities; our multinational operations;
- Business Operations: domestic and global economic and credit conditions; risks and uncertainties from the payments-related business and industry; disruptions in our data center hosting and public cloud facilities; retention and attraction of key employees; defects, errors, installation difficulties or development delays; failure of third-party suppliers; a major natural disaster or catastrophic event; including the impact of pandemics and geopolitical and macroeconomic challenges; environmental exposures from historical and ongoing manufacturing activities and climate change;
- Data Privacy & Security: impact of data protection, cybersecurity and data privacy including any related issues;
- Finance and Accounting: our level of indebtedness; the terms governing our indebtedness; incurrence of additional debt or similar liabilities or obligations; access or renewal of financing sources; our cash flow sufficiency to service our indebtedness; interest rate risks; the terms governing our trade receivables facility; the impact of certain changes in control relating to acceleration of our future indebtedness; our obligations under other future financing arrangements; or required repurchase of any notes we may issue; any lowering or withdrawal of the ratings assigned to our future debt securities by rating agencies; our pension liabilities and write down of the value of certain significant assets;
- Law and Compliance: allegations or claims by third parties that our products or services infringe on intellectual property rights of others, including claims against our customers and claims by our customers to defend and indemnify them with respect to such claims; protection of our intellectual property; changes to our tax rates and additional income tax liabilities; uncertainties regarding regulations; lawsuits and other related matters; changes to cryptocurrency regulations;
- Governance: actions or proposals from stockholders that do not align with our business strategies or the interests of our other stockholders; and
-
Separation: the failure of Atleos to achieve some or all of the expected strategic benefits, synergies or opportunities expected from the spin-off; that Atleos may incur material costs and expenses as a result of the spin-off; that Atleos has limited history operating as an independent, publicly traded company, and Atleos’ historical and pro forma financial information is not necessarily representative of the results that it would have achieved as a separate, publicly traded company and therefore may not be a reliable indicator of its future results; Atleos’ obligation to indemnify NCR pursuant to the agreements entered into in connection with the spin-off (including with respect to material taxes) and the risk NCR may not fulfill any obligations to indemnify Atleos under such agreements; that under applicable tax law, Atleos may be liable for certain tax liabilities of NCR following the spin-off if NCR were to fail to pay such taxes; that agreements binding on Atleos restrict it from taking certain actions after the distribution that could adversely impact the intended
U.S. federal income tax treatment of the distribution and related transactions; potential liabilities arising out of state and federal fraudulent conveyance laws; the fact that Atleos may receive worse commercial terms from third-parties for services it presently receives from NCR; that after the spin-off, certain of Atleos’ executive officers and directors may have actual or potential conflicts of interest because of their previous positions at NCR; potential difficulties in maintaining relationships with key personnel; that Atleos will not be able to rely on the earnings, assets or cash flow of NCR and NCR will not provide funds to finance Atleos’ working capital or other cash requirements.
Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those set forth in the forward-looking statements. Additional information concerning these and other factors can be found in the Company’s filings with the
Non-GAAP Financial Measures
Non-GAAP Financial Measures. While Atleos reports its results in accordance with Generally Accepted Accounting Principles in
Adjusted Gross Profit (Non-GAAP), Adjusted Gross Profit Rate (Non-GAAP), Adjusted Income from Operations (Non-GAAP), Non-GAAP Diluted Earnings per Share. Atleos’ Adjusted Gross Profit (non-GAAP), Adjusted Gross Profit Rate (non-GAAP), Adjusted Income from Operations (non-GAAP), and Non-GAAP Diluted Earnings per Share are determined by excluding, as applicable, acquisition-related costs; pension mark-to-market adjustments, pension settlements, pension curtailments and pension special termination benefits; separation-related costs; amortization of acquisition-related intangibles; stock-based compensation expense; transformation and restructuring charges (which includes integration, severance and other exit and disposal costs); and other special (expense) income items from Atleos’ GAAP gross profit, expenses, income from operations, interest and other income (expense), income tax expense, effective income tax rate, net income (loss) attributable to Atleos, and earnings per share, respectively. Due to the non-recurring or non-operational nature of these pension and other special items, Atleos’ management uses these non-GAAP measures to evaluate year-over-year operating performance. Atleos believes these measures are useful for investors because they provide a more complete understanding of Atleos’ underlying operational performance, as well as consistency and comparability with Atleos’ past reports of financial results.
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA). Atleos’ management uses the non-GAAP measure Adjusted EBITDA because it provides useful information to investors as an indicator of performance of the Company’s ongoing business operations. Atleos determines Adjusted EBITDA based on GAAP Net income (loss) attributable to Atleos plus interest expense, net; plus income tax expense (benefit); plus depreciation and amortization; plus acquisition-related costs; plus pension mark-to-market adjustments, pension settlements, pension curtailments and pension special termination benefits; plus separation-related costs; plus transformation and restructuring charges (which includes integration, severance and other exit and disposal costs); plus stock-based compensation expense; plus other special (expense) income items. These adjustments are considered non-operational or non-recurring in nature and are excluded from the Adjusted EBITDA metric utilized by our chief operating decision maker (“CODM”) in evaluating segment performance and are separately delineated to reconcile back to total reported income attributable to Atleos. This format is useful to investors because it allows analysis and comparability of operating trends. It also includes the same information that is used by Atleos management to make decisions regarding our segments and to assess our financial performance. Refer to the table below for the reconciliations of Net income (loss) attributable to Atleos (GAAP) to Adjusted EBITDA (non-GAAP).
Adjusted EBITDA margin is calculated based on Adjusted EBITDA as a percentage of total revenue. Adjusted EBITDA margin by segment is calculated based on segment Adjusted EBITDA divided by the related component of revenue. This measure is used by Atleos’ management for the reasons referenced above.
Adjusted free cash flow-unrestricted. Atleos defines Adjusted free cash flow-unrestricted as net cash provided by operating activities less capital expenditures for property, plant and equipment, less additions to capitalized software, plus/minus the change in restricted cash settlement activity, plus/minus net reductions or reinvestment in the trade receivables facility established in the fourth quarter of 2023 due to fluctuations in the outstanding balance of receivables sold, plus/minus financing payments/receipts of owned ATM capital expenditures, and plus pension contributions and settlements. Restricted cash settlement activity represents the net change in amounts collected on behalf of, but not yet remitted to, certain of the Company’s merchant customers or third-party service providers that are pledged for a particular use or restricted to support these obligations. These amounts can fluctuate significantly period to period based on the number of days for which settlement to the merchant has not yet occurred or day of the week on which a reporting period ends. We believe Adjusted free cash flow-unrestricted information is useful for investors because it indicates the amount of cash available after these adjustments for, among other things, investments in Atleos’ existing businesses, strategic acquisitions, and repayment of debt obligations. Adjusted free cash flow-unrestricted does not represent the residual cash flow available, since there may be other non-discretionary expenditures that are not deducted from the measure. Adjusted free cash flow-unrestricted does not have a uniform definition under GAAP, and therefore Atleos’ definition may differ from other companies’ definitions of this measure. This non-GAAP measure should not be considered a substitute for, or superior to, cash flows from operating activities under GAAP.
Atleos’ definitions and calculations of these non-GAAP measures may differ from similarly-titled measures reported by other companies and cannot, therefore, be compared with similarly-titled measures of other companies. These non-GAAP measures should not be considered as substitutes for, or superior to, results determined in accordance with GAAP.
Use of Certain Terms
Recurring revenue All revenue streams from contracts where there is a predictable revenue pattern that will occur at regular intervals with a relatively high degree of certainty. This includes hardware and software maintenance revenue, processing revenue, interchange and network revenue, Bitcoin-related revenue, and certain professional services arrangements, as well as term-based software license arrangements that include customer termination rights.
NCR ATLEOS CORPORATION |
|||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||
(Unaudited) |
|||||||
|
For the Periods Ended March 31 |
||||||
|
Three Months |
||||||
($ in millions, except per share amounts) |
2024 |
|
2023 |
||||
Revenue |
|
|
|
||||
Product revenue |
$ |
240 |
|
|
$ |
234 |
|
Service revenue |
|
810 |
|
|
|
752 |
|
Total revenue |
|
1,050 |
|
|
|
986 |
|
Cost of products |
|
212 |
|
|
|
195 |
|
Cost of services |
|
617 |
|
|
|
571 |
|
Total gross profit |
|
221 |
|
|
|
220 |
|
% of Revenue |
|
21.0 |
% |
|
|
22.3 |
% |
Selling, general and administrative expenses |
|
132 |
|
|
|
136 |
|
Research and development expenses |
|
17 |
|
|
|
18 |
|
Income from operations |
|
72 |
|
|
|
66 |
|
% of Revenue |
|
6.9 |
% |
|
|
6.7 |
% |
Interest expense |
|
(79 |
) |
|
|
— |
|
Related party interest expense, net |
|
— |
|
|
|
(4 |
) |
Other income (expense), net |
|
3 |
|
|
|
— |
|
Total interest and other expense, net |
|
(76 |
) |
|
|
(4 |
) |
Income (loss) before income taxes |
|
(4 |
) |
|
|
62 |
|
% of Revenue |
|
(0.4 |
)% |
|
|
6.3 |
% |
Income tax expense (benefit) |
|
4 |
|
|
|
25 |
|
Net income (loss) |
|
(8 |
) |
|
|
37 |
|
Net income (loss) attributable to noncontrolling interests |
|
— |
|
|
|
1 |
|
Net income (loss) attributable to Atleos |
$ |
(8 |
) |
|
$ |
36 |
|
|
|
|
|
||||
Net income (loss) per share attributable to Atleos common stockholders - basic and diluted |
$ |
(0.11 |
) |
|
$ |
0.51 |
|
|
|
|
|
||||
Weighted average basic and diluted common shares outstanding (1) |
|
71.6 |
|
|
|
70.6 |
|
(1) |
On October 16, 2023, the date of Separation, 70.6 million shares of Atleos' Common Stock, par value |
CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||
(Unaudited) |
|||||
(in millions, except per share amounts) |
March 31, 2024 |
|
December 31, 2023 |
||
Assets |
|
|
|
||
Current assets |
|
|
|
||
Cash and cash equivalents |
$ |
343 |
|
$ |
339 |
Accounts receivable, net of allowances of |
|
742 |
|
|
714 |
Inventories |
|
330 |
|
|
333 |
Restricted cash |
|
256 |
|
|
238 |
Other current assets |
|
312 |
|
|
271 |
Total current assets |
|
1,983 |
|
|
1,895 |
Property, plant and equipment, net |
|
461 |
|
|
470 |
Goodwill |
|
1,951 |
|
|
1,952 |
Intangibles, net |
|
606 |
|
|
635 |
Operating lease right of use assets |
|
140 |
|
|
144 |
Prepaid pension cost |
|
215 |
|
|
218 |
Deferred income taxes |
|
253 |
|
|
254 |
Other assets |
|
167 |
|
|
173 |
Total assets |
$ |
5,776 |
|
|
5,741 |
Liabilities and stockholders’ equity |
|
|
|
||
Current liabilities |
|
|
|
||
Short-term borrowings |
|
80 |
|
|
76 |
Accounts payable |
|
530 |
|
|
500 |
Payroll and benefits liabilities |
|
132 |
|
|
151 |
Contract liabilities |
|
332 |
|
|
325 |
Settlement liabilities |
|
244 |
|
|
218 |
Other current liabilities |
|
565 |
|
|
477 |
Total current liabilities |
|
1,883 |
|
|
1,747 |
Long-term borrowings |
|
2,857 |
|
|
2,938 |
Pension and indemnity plan liabilities |
|
388 |
|
|
389 |
Postretirement and postemployment benefits liabilities |
|
59 |
|
|
60 |
Income tax accruals |
|
36 |
|
|
36 |
Operating lease liabilities |
|
105 |
|
|
109 |
Deferred income tax liability |
|
29 |
|
|
34 |
Other liabilities |
|
132 |
|
|
141 |
Total liabilities |
|
5,489 |
|
|
5,454 |
Stockholders' equity |
|
|
|
||
Atleos stockholders' equity: |
|
|
|
||
Preferred stock: par value |
|
— |
|
|
— |
Common stock: par value |
|
1 |
|
|
1 |
Paid-in capital |
|
14 |
|
|
16 |
Retained earnings |
|
165 |
|
|
181 |
Accumulated other comprehensive income |
|
103 |
|
|
86 |
Total Atleos stockholders' equity |
|
283 |
|
|
284 |
Noncontrolling interests in subsidiaries |
|
4 |
|
|
3 |
Total stockholders' equity |
|
287 |
|
|
287 |
Total liabilities and stockholders' equity |
$ |
5,776 |
|
$ |
5,741 |
|
|
|
|
||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||
(Unaudited) |
|||||||
|
For the Periods Ended March 31 |
||||||
|
Three Months |
||||||
(in millions) |
2024 |
|
2023 |
||||
Operating activities |
|
|
|
||||
Net income (loss) |
$ |
(8 |
) |
|
$ |
37 |
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities: |
|
|
|
||||
Depreciation expense |
|
37 |
|
|
|
28 |
|
Amortization expense |
|
36 |
|
|
|
32 |
|
Stock-based compensation expense |
|
10 |
|
|
|
14 |
|
Deferred income taxes |
|
— |
|
|
|
(8 |
) |
Loss (gain) on disposal of property, plant and equipment |
|
2 |
|
|
|
— |
|
Changes in assets and liabilities: |
|
|
|
||||
Receivables |
|
(38 |
) |
|
|
(3 |
) |
Related party receivables and payables |
|
— |
|
|
|
(12 |
) |
Inventories |
|
(30 |
) |
|
|
(35 |
) |
Settlement Assets |
|
(24 |
) |
|
|
5 |
|
Current payables and accrued expenses |
|
5 |
|
|
|
17 |
|
Contract liabilities |
|
1 |
|
|
|
52 |
|
Employee benefit plans |
|
(14 |
) |
|
|
(3 |
) |
Other assets and liabilities |
|
171 |
|
|
|
(4 |
) |
Net cash provided by operating activities |
$ |
148 |
|
|
$ |
120 |
|
Investing activities |
|
|
|
||||
Expenditures for property, plant and equipment |
$ |
(24 |
) |
|
$ |
(15 |
) |
Additions to capitalized software |
|
(6 |
) |
|
|
(8 |
) |
Amounts advanced for related party notes receivable |
|
— |
|
|
|
(5 |
) |
Repayments received from related party notes receivable |
|
— |
|
|
|
3 |
|
Other investing activities, net |
|
(1 |
) |
|
|
— |
|
Net cash used in investing activities |
$ |
(31 |
) |
|
$ |
(25 |
) |
Financing activities |
|
|
|
||||
Payments on related party borrowings |
$ |
— |
|
|
$ |
(25 |
) |
Payments on term credit facilities |
|
(18 |
) |
|
|
— |
|
Borrowings on revolving credit facilities |
|
74 |
|
|
|
— |
|
Payments on revolving credit facilities |
|
(136 |
) |
|
|
— |
|
Net transfers (to) from NCR Corporation |
|
— |
|
|
|
(66 |
) |
Tax withholding payments on behalf of employees |
|
(6 |
) |
|
|
— |
|
Other financing activities |
|
(1 |
) |
|
|
— |
|
Net cash used in financing activities |
$ |
(87 |
) |
|
$ |
(91 |
) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
(9 |
) |
|
|
12 |
|
Increase (decrease) in cash, cash equivalents, and restricted cash |
$ |
21 |
|
|
$ |
16 |
|
Cash, cash equivalents and restricted cash at beginning of period |
|
586 |
|
|
|
499 |
|
Cash, cash equivalents, and restricted cash at end of period |
$ |
607 |
|
|
$ |
515 |
|
The following table presents the recurring revenue and all other products and services that is recognized at a point in time:
In millions |
Three months ended March 31 |
||||||
2024 |
|
2023 |
|||||
Recurring revenue |
$ |
763 |
|
|
$ |
710 |
|
All other products and services |
|
287 |
|
|
|
276 |
|
Total revenue |
$ |
1,050 |
|
|
$ |
986 |
|
Recurring revenue as a percent of revenue |
|
73 |
% |
|
|
72 |
% |
Reconciliation of Net Income (Loss) Attributable to Atleos (GAAP) to Adjusted Net Income Attributable to Atleos |
||||||||||||
(Non-GAAP) and Non-GAAP Diluted Earnings Per Share |
||||||||||||
|
Three months ended March 31, 2024 |
|||||||||||
$ in millions, except per share amounts |
Gross profit |
Gross profit
|
Income from
|
Net income (loss)
|
Diluted
|
|||||||
GAAP Results |
$ |
221 |
21.0 |
% |
$ |
72 |
$ |
(8 |
) |
$ |
(0.11 |
) |
Plus: Special Items |
|
|
|
|
|
|||||||
Transformation and restructuring |
|
— |
— |
% |
|
1 |
|
1 |
|
|
0.01 |
|
Stock-based compensation expense |
|
1 |
0.1 |
% |
|
10 |
|
9 |
|
|
0.12 |
|
Acquisition-related amortization of intangibles |
|
22 |
2.1 |
% |
|
25 |
|
18 |
|
|
0.25 |
|
Separation costs |
|
— |
— |
% |
|
8 |
|
7 |
|
|
0.10 |
|
Other tax adjustments |
|
— |
— |
% |
|
— |
|
3 |
|
|
0.04 |
|
Non-GAAP Adjusted Results |
$ |
244 |
23.2 |
% |
$ |
116 |
$ |
30 |
|
$ |
0.41 |
|
(1) |
For the three months ended March 31, 2024, due to the net loss attributable to Atleos common stockholders, potential common shares that would have caused dilution, such as restricted stock units and stock options, have been excluded from the GAAP diluted share count of 71.6 million because their effect would have been anti-dilutive. The dilutive impact of these shares are included in the dilutive share count of 73.1 million used in the calculation of non-GAAP diluted EPS. Therefore, GAAP diluted EPS and non-GAAP diluted EPS may not mathematically reconcile. |
Reconciliation of Net Income Attributable to Atleos (GAAP) to Adjusted Net Income Attributable to Atleos |
||||||||||
(Non-GAAP) and Non-GAAP Diluted Earnings Per Share |
||||||||||
|
For the three months ended March 31, 2023 |
|||||||||
$ in millions, except per share amounts |
Gross profit |
Gross profit
|
Income from
|
Net income
|
Diluted
|
|||||
GAAP Results |
$ |
220 |
22.3 |
% |
$ |
66 |
$ |
36 |
$ |
0.51 |
Plus: Special Items |
|
|
|
|
|
|||||
Stock-based compensation expense |
|
5 |
0.5 |
% |
|
14 |
|
13 |
|
0.18 |
Acquisition-related amortization of intangibles |
|
15 |
1.5 |
% |
|
25 |
|
19 |
|
0.27 |
Separation costs |
|
— |
— |
% |
|
7 |
|
6 |
|
0.09 |
Non-GAAP Adjusted Results |
$ |
240 |
24.3 |
% |
$ |
112 |
$ |
74 |
$ |
1.05 |
|
|
|
|
|
|
|||||
(1) |
On October 16, 2023, the date of Separation, 70.6 million shares of Atleos' Common Stock, par value |
Reconciliation of Net Income (Loss) Attributable to Atleos (GAAP) to Adjusted Earnings Before Interest, Taxes, |
||||||
Depreciation and Amortization (Adjusted EBITDA) (Non-GAAP) |
||||||
$ in millions |
Q1 2024 |
|
Q1 2023 |
|||
Net income (loss) attributable to Atleos (GAAP) |
$ |
(8 |
) |
|
$ |
36 |
Interest expense, net (1) |
|
79 |
|
|
|
4 |
Interest income |
|
(2 |
) |
|
|
— |
Income tax expense |
|
4 |
|
|
|
25 |
Depreciation and amortization expense |
|
44 |
|
|
|
35 |
Acquisition-related amortization of intangibles |
|
25 |
|
|
|
25 |
Stock-based compensation expense |
|
10 |
|
|
|
14 |
Separation costs |
|
9 |
|
|
|
7 |
Transformation and restructuring |
|
1 |
|
|
|
— |
Adjusted EBITDA (Non-GAAP) |
$ |
162 |
|
|
$ |
146 |
(1) Includes Related party interest expense, net, as presented in the Condensed Consolidated Statements of Operations.
Reconciliation of Net Cash Provided by Operating Activities (GAAP) to Adjusted Free Cash Flow-Unrestricted (Non-GAAP) |
|||||||
$ in millions |
Q1 2024 |
|
Q1 2023 |
||||
Net cash provided by operating activities |
$ |
148 |
|
|
$ |
120 |
|
Total capital expenditures |
|
(30 |
) |
|
|
(23 |
) |
Restricted cash settlement activity |
|
(18 |
) |
|
|
(27 |
) |
Pension contributions |
|
1 |
|
|
|
1 |
|
Temporary transfer of funds from Voyix |
|
(32 |
) |
|
|
— |
|
Adjusted free cash flow-unrestricted |
$ |
69 |
|
|
$ |
71 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240513749404/en/
News Media Contact
Scott Sykes
NCR Atleos Corporation
scott.sykes@ncratleos.com
Investor Contact
Brendan Metrano
NCR Atleos Corporation
brendan.metrano@ncratleos.com
Source: NCR Atleos Corporation
FAQ
What were the Q1 2024 revenues for NCR Atleos (NATL)?
How much did NCR Atleos 's (NATL) recurring revenue grow in Q1 2024?
What was NCR Atleos 's (NATL) adjusted EBITDA for Q1 2024?
Did NCR Atleos (NATL) report a net loss or net income for Q1 2024?
What was NCR Atleos 's (NATL) guidance for full-year 2024 revenue?
What is the Q2 2024 revenue guidance for NCR Atleos (NATL)?
What is NCR Atleos 's (NATL) non-GAAP fully diluted EPS for Q1 2024?
How did the self-service banking segment perform for NCR Atleos (NATL) in Q1 2024?
