Payments

NCR swings to earnings dip on Q1 2022 revenue gain, modifies guidance

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April 27, 2022

NCR Corp. boosted revenues in double digits for Q1 2022 while earnings fell, resulting in modified guidance for 2022, according to an earnings report. First quarter 2022 revenue includes the results of the Cardtronics business, which was acquired on June 21, 2021, and the results of the LibertyX business, which was acquired Jan. 5, 2022. Highlights include:

• The company improved its revenue 21% from $1.54 billion in Q1 2021 to $1.86 billion for the quarter ending March 31, 2022.
• Income from operations fell from $110 million to $33 million in the comparative quarters.
• First quarter operating income (non-GAAP) decreased from $148 million to of $124 million.
• GAAP diluted earnings per share from continuing operations fell from 19 cents to a 27-cent loss in the comparative quarters, while non-GAAP diluted EPS from continuing operations fell from 51 cents to 33 cents.
• Net income per common share on a basic basis fell from 20 cents to a 28-cent loss in the comparative quarters.

Quarterly revenue change by segment was as follows:

• Payments and network rose 1,259% from $22 million to $299 million.
• Digital banking rose 11% from $123 million to $136 million.
• Self-service banking fell 3% from $628 million to $611 million.
• Retail rose 5% from $520 million to $546 million.
• Hospitality rose 18% from $179 million to S211 million.
• The "other" segment fell 12% from $77 million to $68 million.

Shares traded today at $842 against a 52-week range of $827-$1,425.

The $1.86 billion in quarterly revenue missed analyst expectations of $1.94 billion, and the EPS of 33 cents fell short of the expectation of 53 cents, according to investing.com.

"Our first quarter results represent strong execution with good momentum across our strategic growth initiatives despite significant macroeconomic and geopolitical challenges," CEO Michael Hayford said in the press release. "Inflation skyrocketed to the highest level in over 40 years, interest rates increased more rapidly, a war broke out in Eastern Europe and the Omicron variant spread. The multitude of headwinds negatively impacted revenue and costs. Despite these unprecedented challenges, we made substantial progress on the strategic growth initiatives that are transforming NCR into a software-led as-a-service company with a higher mix of recurring revenue streams."

The company lowered 2022 guidance for the non-GAAP diluted EPS from $3.25-$3.55 to $2.70-$3.20.