NCR Voyix (VYX) 26 Oct 222022 Q3 Earnings call transcript

Good day, and welcome to the NCR Corporation Third Quarter Fiscal Year 2022 Earnings Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Michael Nelson, Treasurer and Head of Investor Relations. Please go ahead, sir.

you our thank earnings quarter and call. afternoon, for third joining XXXX Good

the Mike today Sullivan, me call Joining on are COO; Tim President and Hayford; Oliver, CFO. and Owen CEO,

of periodic differ that started, also that and earnings me XXXX, described the include of I get Investor presentation With could statements. be call non-GAAP results to reflect but and today's this materials, will statements These current to materially A and These Relations and risks with be now non-GAAP ncr.com. our they're uncertainties release we call release described Before would subject forward-looking in to remind actual measures you to measures. website. dated discussions expectations. October our let On the like will the expectations risks beliefs, on from and page press later our discussing the including website, cause XX, that, These presentation on are turn SEC, over our their and are our certain our replay in financial today and available to reconciled report. our filings the Mike. those annual we'll GAAP call, counterparts uncertainties

questions. Owen, views companies. Michael, our will my into performance Tim NCR on XXXX on for everyone, and intention update the earnings will public Thanks, then and and provide with your for announced our quarter an of you, business will today our financial to call. begin two take third I thank joining us and some I also previously will review separate Tim I

top in NCR margin In well highlights. difficult Let's executed performance included macro begin NCR and significant quarter, four growth that revenue a third on delivered very line team slide strong environment. expansion. The the with solid

significant execution all NCR our our strong strategic with across against initiatives KPIs. Additionally, made progress of

becoming to on a service company made in streams. We with business as software-led momentum revenue strategy higher continue to a the our we recurring NCR progress build positive as

currency First, we constant X% delivered quarter. X% recurring revenue year-over-year total currency constant also the a revenue growth basis in third on basis and a growth on

EBITDA expanded adjusted constant and a increase XX% XX.X% of from which basis finally, margin XXX quarter EBITDA XXXX. quarter on from increased Second, And to basis of adjusted represents currency second the the XXXX. a point third

across Now the deliver business which to moving our slide to In the growth on transformation. We our company to strategy platforms, momentum strong retail five. our choice. had company's strategic we update be retail, of platform support continue on

the we and CFR quarter, XXX with platform chain They NCR to Commerce a convenience self-checkout, large global converted commerce software use extended made-to-order the of over lanes. expanded partnership subscription During our In ordering a the the capabilities them via in-store to platform. online platform capabilities and This of NCR, allowed adding stores the X,XXX NCR third gas unify named stations. their RBR XX% food SMB customers a and payment SMB, enterprise customers. market them XXth usage year. see continue new strong attach our In refresh mitigate experience to leader to In rate third sites. continued self-checkout for and number across high costs. hospitality, for the remains booking self-checkout the payment extend and quarter, with we demand customers to consecutive In our our we of record driving help for

also deals improve experience member software have added we and increase renewals, continue accuracy. In our more Wild speed to five platform. and help added Digital converted of digital two along quarter Wisconsin-based in NCR's account area Digital Banking, Bank continued which Associated platform. the improve new serve almost we we to Wintrust and our the third guest conversions expanded to team In and that in of banking tablet third our to acquired quarter, which large history. extend accounts. In XX opening momentum. two Terafina, digital opening account its service These Banking XXXX largest digital positive order tables, had Wings, logo subscription with to to the of banking regional the expansion the capabilities our Bank Buffalo X enable them Chicago will restaurants also quarter, We offering relationship banks, million new online with experienced

We we our services also financial solution, digital-first channels retail where channel a retail using had success platform. or banking with our CSP integrate institutions

teller now Allpoint Citibank banks in NCR's of quarter, progress are Network. CSP across the we merchant selected two top platform. their U.S. software. third In solution branch Payments the on acquiring the has replace teller to Network, CSP and During making both teller legacy five the NCR our and

are deals. NCR capability momentum ATM-as-a-Service signed and in In full the our has financial with as-a-service a kiosk give deposits. XX% at Allpoint of on our before. as-a-Service with a to plans banking ATM And to bank including a today ATM company. its Network fee-free our offering when provide from marketplace. ability offering retail solution. selecting that the for to us clients solution details to NCR integrated third both to bundled provide customers, community XX unique scale growth we to globally. and with success The enabling integrated to have and you more separate our our in we by the deposits cash we financial lastly, its third the extended into partnership institutions XX public cash the offering top self-service in our of Allpoint banking, Allpoint banks Solution. hospitality than large The access continued everyday accelerating is continued Interest payment and continuing cash FIs We In transaction, quarter, SMB quarter, strong stack cardholders given bank, ever a more NCR's In will delivering two including new payments Network offer the this

First, have financial and an then separation I'm going our will cover provide those to update and Tim? Tim I results, Tim on activities.

and you, Mike, happy Thank birthday.

and face the inflation, performance a of strong in represent of historically continued Our U.S. dollar. rates strong macroeconomic increasing third persistently high interest impacts quarter results rapidly

global economic this is geopolitical focusing can on and the weathering we chaos by things Our control. team

is Our to financial deliver each and team's strategic sustained simultaneously our laudable. make commendable to the progress customers and is other and ability commitment to solid results

of unfavorable XX% million on and right, on for begin $XX adjusted had billion, third banking retail overview $XX adjusted U.S. The a left, recurring and impact with was X% very financial our Starting top constant a $X.XX increased X% quarter constant the up let's currency of revenue performance. was million within prior slide currency. top Revenue top primarily was dollar our year, So In million. in up the six or level from to strong segments. the up revenue when self-service $XXX EBITDA an year-over-year million $XX basis.

currency third EBITDA exchange million. XX.X%. impact Foreign of basis XX rates from the of unfavorable Adjusted had to XXXX points quarter expanded an $XX margin

EPS a described that the sequential the or While cash year-over-year. described non-GAAP by EPS financial bottom are challenging continues versus finally, comparisons U.S. of with up end a that, very cash of we margin the of XX% The dollar the recovery $XX a quarters and free our $XX last about strength $XX the reduced targeted impacted first the to needed. flow basis, three we currency-adjusted In and are Adjusting of reported the XX% performance illustrative, accretion by within improvements we EBITDA rate XX% The actions April two expect the of range was million rate be the year in that XX% that left, up XX%. to always the $X.XX, for to year-over-year. delivering non-GAAP tax achieved not year, cost $X.XX. XX% in remaining modest a pricing two outlook sequential full flow tax in profitability Free year. On after And each to $X.XX use was EPS issues. range. of million to quarter, and be April was was the of The high provided we million. in EBITDA prior quarters back for

able First, incentive reductions now capital. programs impact and they flow investment provide more causing are slide on effects cash of evident quarters. timing still couple in before we to that second, in next cost Both chain cash an our harvest the the are challenges And of nonlinear should labor detail on supply XX. and these working I'll to generation employee P&L though impact are of starting be the benefit flow. and revenue both issues over abate

year-over-year retail points constant up up key better points XX% the Starting the Moving results. currency XX%. was to on X% expanded our shows Adjusted successfully and POS on or Retail particularly slide reduction sequentially a performance EBITDA mix segment pricing constant EBITDA XX% XX% inflation, as better indicators. cost left, Component retail retail on adjusted revenue which rate devices up reported product mitigated and and segment year-over-year seven, actions, was currency basis. basis by year-over-year slide basis. bottom top The $XX XXX million on up a XXX shows during and the basis quarter. cost margin of was to a

across revenue. left, the our center platform success or Hospitality our convenience growth that XXX% by higher our ago. customers lanes Remember self-checkout. is impact to lanes increase $XX driven major accelerating of and segment need have rework Slide conversion lanes Self-checkout year year-over-year and a by subscription We the platform-based the substantial model. and was for pattern accelerate momentum period conversion illustrates by our timing revenues, is number expand. convert KPI strategy of currency tooth and and caused orders pressures restaurants shortages our fuel of this X% the increased for In driven lanes, of overall the more year-over-year. lane of traditional rollouts X% that We at to wage increased results platform trend three On compared shows continue platform partially [ph] a large The lane the a platform business. and our soft the and major revenue same retail to million by customers. is by adjusting than eight Hospitality SCO to currency, our depicts ARR platform to retailers. our see growth by translation. self-checkout as momentum reopen, Labor backlog. XX% increased bottom in offset the the for revenue

Enterprise openings Aloha the Our up driven cloud technology refreshes platform. relaunched and success was our store up SMB by XX%, business of by new driven our X% business was and

mix sites and this platform with sites A sites margin platform key revenue payment payments was quarter Third strong on payment adjusted quarter sites, indirect more hospitality. Hospitality's and year-over-year, was ARR increased adjusted profitability XX%, Platform very drove sales for and improvements. up XX% was the XX%. cost metrics ARR. of bottom another improving year-over-year, include EBITDA absorption EBITDA increased X% XXX% and slide richer up and rate

with Banking's at posted success revenue slide a an adjusted those year to Banking continued segment. driven CSP bottom EBITDA XX% registered $X to almost million Digital EBITDA on and to Terafina, user active which XX% revenue. at grow about users, continues margin increasing year-over-year this rate. recurring similar recovered Digital increased we or ago. levels which counts, nine, a Turning key at rate Digital X%, Citibank metrics shows increased and XX%. win users Banking our users Both active by registered annual slide to have a increasing include to of the and

mentioned quickly last last more off anticipated two Wintrust rolled Bank we quarter, As long customer wins of than rolled de-conversions year's and at Associated major two on. consolidation

FX cost and we and year-over-year is Move year, segment. rates. Payments year-over-year XX% is EBITDA prior active Network slide higher-value or margin XX% the metrics. and growth. when goods. rental revenue and Networks adjusting our million slide Starting when $XX tied More ARR ATM Adjusted to Payments key XX%, Beneficial of cash from offset up higher rates. to a at FX. goes adjusted be EBITDA The cost top to digits interest significant is for in increase in single which and and endpoints rental cash the Payments at Network those leverage shows this for was and to year The adjusted transactions is and generating through mix cost cost bottom the X% expect rent increased increased X% the year-over-year. This was by driving fleet, revenue X% more Network cash users of up XX. the due and left, our were for high For rate directly EBITDA down Payments of costs. to

acquiring the process recurring increased the the KPI them access the Network acquiring our across our XX Slide to X% was XXXX. and currency left, Allpoint of Network as merchant bottom up business as the center bottom In on a basis. were was our Adjusted a quarter X% shows migrate networks. payments was this our X% Self-Service third The up year-over-year transactions, year-over-year the rate and constant Self-Service the Transactions increasing a shows These XX%. Allpoint illustrates segment EBITDA constant on On results. and margin installed revenue base. revenue year-over-year. Self-Service are NCR X% metrics. endpoints from Banking XX% EBITDA in key up basis. increased declined that Adjusted reported And slide and the merchant Banking new year-over-year. the annual of to segment we bottom points terminals XX% currency Banking flat

our On the service year-over-year at India with was mix services as added the higher to X,XXX units. significant sales We year XX% XXX% flat this increased units and U.S. to XX,XXX software units due almost ATM in growth growth revenue and hardware left, experienced to quarter. compared in in ATM a incremental last

continues to expect contract. flow, year-over-year. adjusted On facilitate ARR revenue debt a end to year We service gain ATM over traction This X% calculations. backlog and machines shift slide we under the with now present a cash metrics recurring have and of strong EBITDA leverage to XX, free with to up XX,XXX as net deals

As the I quarter. a cash was previously in million stated, use of free $XX flow

reasons year. $XXX through and Inventory cycle to nearly impact working outstanding sales Days all increased versus days beginning has increased impact days the first been the has a million has I challenge. of of caused three days days discussed capital the another this timing of than seven the a cash quarters For the has year. XX of more four the net upfront,

QX. $XXX hand in it for April has other component our in drive in at to the full we guidance compensation combination quarter timing Since rates now of of fuel, EPS. impact More cash the a QX. free Mike, quarters issues on nearly provided very you. of deliver with to to impact finally, up payables cash well leverage flow That differently, billion lapse to anticipated back anticipated the to from improvement, than before from to of generation those QX. to all provide back follows, EBITDA still say the used profit time, should To I some improvement billion adjusted Mike, within metric QX by our thoughts of and similar more working we of Thank And adjusted now In cost, expect capital occurring said, freight, of of of revenue, billion covenants. while it free in revenue in well $X.X as QX improvements start of million. $X.X due is prior This our fall QX timing resolve working ranges profitability. $X.XX will free ratio The slightly shocks, guidance issue that most debt accompanied fourth debt of $X currency half believe both X.X, control net in shows to initiative XXXX not $XX reduced benefits the anticipate from our and cash EBITDA to remain $X.XX back also provided, our year a million strong flow, of of And from was improvements, including April higher war, capital the a profitability and you. order ensure flow. we next benefits, exogenous and adjusted down next the slide significant than back perspective cash and tower year guided that that could have by compensation We and ranges. We that approximately this standing quarter within XXXX. inflation, we $XXX doubled relief that the been with in interest a currency to and higher estimate and also I'm to to harvest two specific adjusting QX, that results cash for more in QX in million. cash We

Thanks, Tim.

that our we As I month on and separation Tim a referenced starting activities earlier, update will on an provide XX, slide previously ago. announced I

me at On segments can reporting thoughts starting Let you the on two on our see public five NCR. slide XX. into separating an company, on update XX, current NCR slide provide

separate a with on we can ATM forward, and Going we stand-alone advisers a see our taking a as into number on factors of this Board business separate company, worked consideration you that have into out plan our slide.

believe the existing alternatives to through also work By SpinCo we best four of if timing could deleveraging expect Remember, the a the the NCR to also we that to time. provide path that be ATM how via the be shareholders. company would next As our we for manner reduce of to a still to at the distribution flow separation, public business a we ATM quarters that forward is affect into execute the at XXXX. would to five difficult expected spin-off end of tax-free separate over which markets have we in were cash spend generated time, the believe debt could leverage, shares

slide growth actions will hospitality, RemainCo to action. Self-Service segment This cover steps and shareholders. software-led around includes entity NCR's customers believe distribution digital-first for is business be and years with past technology will Network generation expect details have Network retail, and revenue we to business to recurring stable NCR banking strong store, for of These a will thoughts that taken strides a to where ATM has in upgrade the see continued two into self-service existing RemainCo made in aside back Payments the transform and align banking. a dividend we is flow our Banking SpinCo into company. to the have solutions. We to customer-first the continue digital include cash form section, business imperatives. us from us let XX. services run move to a through our Payments company to is which prepare to via significant services and a RemainCo all on payment. markets over of cash software-led a allow of our ATM few five on me a the deliver help to this will to business, run we to majority be restaurant shareholders as banking a company. existing expected NCR illustrates markets solid our share Services The merchant those competitor and organization to more shares NCR's segment our his businesses. organizations. and us separation the Going the spending deliver operate Merchant transforming Tim businesses taken new but SpinCo, of can

In terms of bench of leaders leadership a at each we experienced company, have NCR. at deep

the through organizational working structures. are We

However, as for is partial should board the teams path each value the considering open deliver value, options that unlock could we look such the to approach alternative this believe intend but the a NCR, alternative superior will management whole of remains available We shareholder that become lead to internally that company. scenarios. best company sale future to in or

Now and each projections Tim to it these financial I'll review of capital to the of back companies. pass structures

All right.

XX. up picking slide on So

of have at last capital from margin the ATM show basis less 'XX. five and in of of XX businesses. we top the a with Here, margin at two lower jumping of the XX-month chart modeling These rates two results more RemainCo. the off and size This and into each year ATM and and similar allocation Investor NCR NCR growth we our of our intensity good a scale recast back the and basis page intensity the SpinCo resulting is Day two December rates capital revenue for described point strategic higher businesses independent presentation on last businesses rates an SpinCo. that RemainCo then on months The

these the will not be revenue these rates both the is could the businesses each page, end end to of we the above this will to describe the of or of ramp be On to current expectations. low of targets. contribution grow year slightly at the slightly below expected the while in of SpinCo our outpace RemainCo performance five at of longer-term linear expected future two bottom range. six the businesses nine growth point These range, using ATM as our of NCR or growth as-a-service high

of by We expect we more both lower than margin then, rates RemainCo quickly expect revenue. margins accrete cash remind be And with capital RemainCo you than and both grow for and businesses the to to invest NCR at average And we margin. that expansion. should and A expected the we separation. to then substantial up. of qualitatively ATM starts be structure the default EBITDA rework [ph] margins At XX. to have slide at to expect and current can predictable. ATM it of while appropriate SpinCo, And growth, structures cash high for more be already as Here, able generate turning NCR's they modest more to ATM and at each more stack SpinCo NCR so conversion capital RemainCo to strong the post should SpinCo are lower finally, debt improvements NCR time and higher we for conversion

by the more All when this those similar that to transaction. be predicted execute of financing to will interest that markets but will the rates curve, assumes receptive forward be we analysis

First, by times will with the to we The of more ATM on require post X.X a this invest times business full secured continue out reduces work not in intend allows Lower of debt. may amending aggressively cost, keeping RemainCo, group. continue a then debt to amount pro by more underfunded the numbers. secured thirds allow the senior strategic X.X then considered of and three is growth. targeting year we would The leverage This our already the bank of minimizes at our RemainCo. larger rest less RemainCo. issuance also likely funding unsecured debt to stack forma existing ATM and post the than debt us terrific plan with spin X.X will first costs at new SpinCo, We to a at banking a based existing breakage transaction. based numbers. the are seven fill between by current ratio a two debt lower debt and augmented in and to requirements retain than leverage At full We And our forma leverage debt to spin net expect proportion on spin go we ratio conform partial the debt leverage at and position tax our underfunded U.S. At spin our net targeting full SpinCo, pension of first year of are note position. be pro SpinCo modeling. then between to with of time in year the

We expect this in intensive, that less million And to that, the split. business to into for the we payer. be be dividend on capital bottom reduce deployed between With million anticipate separation to flow going be free investment now cash a overall you. to $XXX finally, can and less the to back green, require $XXX and leverage of growth Mike, right generating

All Thanks, Tim. right. again,

slide to are a for the clear. - XX In with Moving of looking-forward the very year closing, rest conclusion. our priorities

level build team which environment, our still is to the will third execute we in strong and a macro delivered First, high quarter. the believe continue a on in at challenging, we performance

company. Second, to a software-led transforming we made NCR as significant have a services progress

expect right Our momentum is in strategic marketplace. build first we to and these said are continue the we team to way, the on continue stating win our business, different in that maybe KPIs a direction, are trending winning, two bullets and positive in the to will

are we on focused structure. improving Third, cost our

our generation, with opportunities. flow, And to cash streamline allocate referenced. a cash strong actions strong expect with flow Fourth, As we the expected the the as Tim we efficiency we to mentioned, cost continue capital fifth, Tim out expect close year costs. - to have will identified return to highest we

with levels. the to delever balance the at repurchase attractive shares to will opportunity desire We

share As And two NCR tap. we authorized finally, repurchase separating reminder, a we a we have companies. are on that into can focused program previously public

And concludes With and to time, today. are That expect Thank by that, will through in to go working end Instructions] we open Operator, to be and position the execute the We Matt D.A. Davidson. for line. our you. with prepared structures the a call for open of [Operator will separation organizational first remarks the please legal this Summerville the questions. at we XXXX.

A questions. couple of

the to close guidance. loop just First, the on

of plus now to call if math drop-through minus, that around biggest the cost as $X.XXX the business to I pertains to range, the You'd Payments haven't the would the Tim, be end it and the delta and of will. EBITDA, something Are implying or for indicated on yet. and in cash the to low I year done those two FX two But July be the comfortable at and we're buckets, incremental full billion, certain. were obviously the you headwind July want deltas Network you the revenue from from exact biggest

Yeah.

XX. So on the across to to be interest then side, we about turned pressure of million have $XX to closer It out expected back year. the

absorbed a of if we've business, the So we rates That pressure Payments lot million at the much $XX the range, the to higher than had of interest on anticipated. X.X you that X.X. go through will, P&L, through EBITDA

currency currency EBITDA. And $XX and full it's on to flow. has awful now side, an latter the fact, the the of think year half $XXX that gotten going on currency On million revenue We million will in of $XXX-plus on million the worse almost be year. be in lot cash impact

a We issue. So currency big back could has have not become anticipated then.

in project you revenue I if just middle and FX forward the QX, think I safely and me range give the QX be will for of the on EPS EBITDA. duplicated on described, and relief on a in you numbers

that think out. I thought guidance reasonably was well So

got out cost needed Also worse. and of to back the thought scramble bit than We've you was against. inflation interest I little and a think we we taken escalation executed described. reasonably to, it some well cover more expense that

yes, that I So hope helps.

Mike. this But is me Matt, let -

statements. clarify Just me your let

range the When so and - it's So of X.X. outlook, we always FX. X give we gave to ranges

I the same. think most do companies

year. So range within XX clearly we're within for range of the excluding to full that XX FX, that

then and $XXX between affect $XXX a cash how SpinCo', remain now you when flow leverage that And million and that is free follow-up, just anticipate for treating the transaction? as generating projections it. Got you those to million of

to applied that to presumes $XXX indebtedness that the it million gets reduce execution $XXX of Yeah, about of prior deal. to million

it be debt to plan of overachievement you extent closer end for or then the $XXX, low paydown share $XX to using And the any range, on on further site? assume that to would \would you maybe overachieve fair buyback at or $X,

next And So good would right that that some a and buy free we value in flow can are out quarter start I cash back that work we generate shares once shares. proving our hope think get can to we the now. I very

Thank it. Got you, guys.

JPMorgan. our question go with from Chung Paul we'll next to And

Thanks for question. Hi. taking my

your the How So also feedback uncertainty just engaged retention customers is to and are segments? of of keeping on you are high? teams across the How of kind spin, levels And [ph] internally, employees what's reacting kind the from been here? then kind the

Yeah, this Mike. is

with And start me guess ago, month side. about we the announcement. a I Let made customer the

talk businesses any us to umbrella this marketplace wasn't through I feeling having And conversation the an executives. to probably has Owen multiple that led know favors. very point is - I you the the you well. and think has exception, - as conglomerate two in look, dozen been done with many C-level So directly walk terms doing underneath of that if as undervalued I our productive when we're without in

it. as a ATMs. I'm one this haven't had over Europe, get in with drive by So have look single hospitality as Europe. concern. across we've say, clients business I've country. buy that, I by done also all met I and literally or done They single or buyer I that done POS banking They'll at I look, with a services our And a retail

halls, conversation including of from in our Atlanta, we Belgrade, and as been sit of transaction from have The every change, people, side, getting Dundee, reaction manage feedback in the customers not of it's got as all business employees just calls week end at with around and did the the for our town We tell been ready positive we're has has On six only We managing just road through globe. customers. Dallas when the but difficult employee XXXX to a 'XX. employees London, same it do got on and with also doing other the about front spin usual the and person doing down what and we're it. why you our I'll a

employees get to year, customer customers. what's to again, Owen, back want I'll from concerned next it let's they happen I perspective. over know haven't Our over them to go and just had going anybody but it whatsoever pass And don't to the it. what to a totally means

They like that, market, more of frustration it's with explained of and once came other Mike appreciated agree of They XX% issues. very year-over-year. just that. lot creation to the value underlying us is up we the that the about any It's that latest business We curiosity NPS in performance conversations. are conversations. being up this quick would through I our about had Customers scores. not our seeing tell or acknowledge

to that's We've them. talked of people So with day, to from customers, the issues strong we really think curious about our we're we if continue very creating not And feedback the were end have Mike's now. at the all doing to care extensively as internally the they are market. to And really, distracting this. point, and right why I

implications the think I the companies. general that are from more with two employees there's about going uncertainty where economy to there than and we're our of our

are past, into. majority people the our the that the within in talked we're of aligned already separating businesses we've As

So where going in if you're you're that's a the support retail, a person spin. or banking to in developer post be or

I about the are think business to going overall economic those we're to with to do of and alleviating to conditions, we the about they're what quickly talk more and some concerns. continue So anxious them

active follow-up and users. rebound on a Got digital you. banking, here And you nice registered then know, a in

Was other how banks. think term talk do is And here? firm how winning near Wintrust competitive in then the the about we kind And a regional mentioned this differentiation, about growth user deals? You and the win? of

Yeah.

then bank, which again, those - of both Bank, in collectively, and and X million bank billion $XXX banks. almost Wisconsin-based is Chicago-based So bank with It's Associated Wintrust regional $XXX on very are brought size, And large they with asset billion. accounts.

down banks. went joint well those organizations board. that think, about Those meeting NCR little over team, to as team, to that them executives team. team of just say on from both shout \we flawless are the and when a conversions talked with signed I we've now we've time literally as between of out that last, the the was months the I cut conversions Those So It effort the bring those the six takes them. the

on came board accounts throughout those quarter. So third the

fourth saw as will board we with So And the you'd in you - coming about expect fully the the quarter. see growth, line on you accounts, be the talked same double-digit the revenue to top account growth.

going a were competitive. digital So about team be said $XX job year's the to banking, to competitive has expect last that bringing we that them you see billion that marketplace. in where back wins forward, should really very last phenomenal both forward. in done of - going above Investor talked We Those Day, our

more have there, taken so. than share We to expect to out we victories of lion's continue our and do

I'll on all comment all that and businesses, on industry the the expand. only the The entire is Yeah. land our other is to strategy add

wins to comments those our commented are the and about channel really banking we'll our embracing his Terafina performance digital institutions of is we business. to leading Mike portfolio growth just that the that add of offering. services the the in customers of platform So about in opening those NCR strong and talked

seeing result conversions. expand we're as strong coming land great a really So of and

other comment in quarter we firm. we're look the largest The out talk team and history the had is, it make order we I'd the perhaps at fourth digital the be will since to quarter, the of looking actually, to we've banking as

really business So time. take of is through the we're that first momentum bullish. really the but next will in some Those will half Those year, convert strong.

Thank That's you. Great. great.

Mehta And of on Kartik question next we'll to Research. Northcoast our move from

shared to and service intend you thoughts of much those services how or Hey, two deal how and they're for with business I'm on sure shared businesses? good services afternoon. the not the some and sharing Mike, so maybe ATM. retail

great a that's Kartik, Yeah, question.

next we our years we end as job one look literally to hospitality work really or it's the whether on on today go lines within working get on the is where retail, year, business, to the of that know, of been the last vertically for So to stand side you four go-to-market aligned the at but spend, with banking.

So most of that work is already done.

are then We fix functions. a do support to break few and obviously, for for on some we've to retail have - remaining service corporate shared the do street banking and some the got hospitality, the services, which and

and those shared that already actually, Belgrade out in centralized focus the itself, a have systems basis some either example, services both. on they business. deployed they of on on automation as on or and get either, as field, fixing have focus a a lot have or dedicated are And who we specialist centralized SCO sites of then a put a ATMs do in teams full-time certified So specialist. those In sites devices retail the fixing resources to we generalists full-time the like are self-checkout banking on the basis for to

agreements through it's gone scale has would services and we have have to specialty team enough our where we separation, the make whether mass whether other cases, one or generals then the in to group to and we'd the into just break identified through how have handle, the So in area from area. geographic most

where we out of that think we there'll and be think in have terms that handle will means a we minimum. We be kept think some where recognize quite - we but good we those good pretty we'll a we So what a separating that. some pretty have - of dis-synergies, sense have on

you thoughts Tim, and Obviously, think the spinning I I'm maybe that by on think showed just for And dis-synergies EBITDA thoughts wondering showed the segment. on maybe companies you create. out separated just that dollar dis-synergies your slide will then, dis-synergies? two just companies both

Yeah.

think expense between incremental million up to $XX to to we million it's and independent $XXX companies. going stand be of So

million I of the just and that direct would be of think to public company million organization. duplication the is $XX of $XX rest other parts costs

offset $XXX months, next Over more six probably significant cost pretty to the inside to than that we're million. year, some the organization targeting next actions $XX million

help in that twofold we'll probably to are actions and place have that be cover that us ready. think I

the described calculations, So assumptions cover here presumed the in to that's cost we've incremental that that we that and out leverage that model and get in on able the we're expense.

the Tim, more $XXX million. double – that or $XX anticipate you to do taking than you out million said

better could expected? So actually you - EBITDA than with

Yeah.

I in as there right? are will be topics, described, ready you separate One And fact, is associated two split. to getting dis-synergies that. think with there

actions during XXXX some went year. back of decent for allowed and pricing As to a through cost the full course to performance we you us know, that the scramble

costs pressure are As we would have enter associated with north with freight the than generate million - help Owen component expect difficult and that. both and pulled and for others into ready us his XXXX, the to XXX [ph] some actions we year, and labor of we're to going those to be $XXX productive spin. you cost pervade productivity and getting team together actions associated Those more offset XXXX. another

Thank appreciate I really very much. you it.

All right. Pleasure.

of question And Zaffino Oppenheimer. Ian next we'll to our go from

maybe rates? about Thank you the with. on opportunity is that the are exactly you're the more those question RemainCo remain best? thinking on that you it very one leverage much arriving spinning especially the out SpinCo the leverage And what's vis-à-vis how of co, M&A, Just leverage at then Why for

more or area. we in growth that So growth organic M&A expecting

Just a great. would there Thanks. little color be

Yeah.

ATM very a generates SpinCo can think cash flow So leverage more predictable we on the we that perspective, a it tolerate that leverage, stream. believe and

it covenants for our under leverage dividend leverage RemainCo we place. an we not perspective, or capital because it's intensive. carry covenants that to existing From the keep payer, long-term as can need And in it's want a more X.X. and That's of our thirds obvious two so debt to little the a keep

to to We this leave to room also for continue in growth segment. want ourselves invest

they're the we'll tax that thought was the... - be But don't either of on So leverage fall to where on can we they're you know And at than exactly the right two in the these businesses. is wide think process. SpinCo, here ranges. both, ATM tell, out as both lower We

opportunities let just - on M&A M&A for the On the or RemainCo. address the growth inorganic me

that. the to those all that an the integrating of very POS people are do you will if retail already imperative, banking financial it's So think we products being well RemainCo, We retail have We the as - on an banking. and about in side, on growth think marketplace. it's channel the areas upgrade on POS, talked side it's particularly hospitality suited retail as digital at we look digital three the area and see opportunities we've focus the spending POS are financial side, their strategies our institutions, but institutions continue

it great had company a [ph] end an successful. allows the order entry brought DX, Banking, a we Trust mobile which product Terafina, about that Wind inorganic for POS. just Associated company which over is to years, on a in We Freshop, basis Digital in Bank, and glass, we've which retail been success into we've integrate winning Bank the front last have does of very Cozinstra four grocery which seen, your that's successful you device the We account-opening was virtualization. is with called talked

success those into with success products upsell to a platforms we've going our actually have are had We lot be integrate earnings So of cross-sell. us and companies underscaled think a of some point they're lot for more to flow opportunities of that where attractive generating forward. going 'XX, product, but building inorganic that haven't then acquiring or might had cash a maybe gotten

grow organically as well as So RemainCo we will to think opportunities opportunities. have inorganic

of inorganic that or mean, bit sort all guess little organic my Okay. And do maybe there. just these opportunities RemainCo. I a was I opportunities there's I follow-up a think point that of

than ratios leverage should actually SpinCo larger to companies less and maybe on more So meaning RemainCo then be two should take leverage? leverage that between should the take difference in the

Yeah. in I mean, could we turn it its way.

to marketplace, want becomes a we put we SpinCo look closer leverage sheet SpinCo. we've where it equation an we got balance much get build a in to for at think date I of how as on the

that. don't We want companies over at lever have look we'd would think succeed. to I to I think both we either opportunities company.

And your so I think we point. get

to which currency and a do is establish would the can't out we have to keep simply today to to able equity we in think businesses, deals go thing that RemainCo, do. we mind, be hope higher-growth a other I a using when

cash return RemainCo some which steady, of right, that inorganically. participate in organically that balance and to keep that to So getting then I and goals a shareholders we'll company the be in much be gets to But stable, generating how debt, growth to dividend think to cash via mind. able SpinCo

much. you very perfect. Thank Okay,

with Erik Woodring Morgan Stanley. And we'll go next to

commentary our the Hey, guys. start I if mixed Mike, of my impact some guess, taking macro you, question. Maybe, hearing coverage with of we're I from uncertainty. for Thanks terms in

in hearing of any deals? at caution from And downsizing time so, Is deals, there elaborate on what close you pushing customers can or of out maybe you're just to any terms by difference vertical And of be if then have there Thanks. if maybe super And that kind or market a any that all? end follow-up. is you detail I could would helpful.

Yeah.

add and some have me color. Owen then start, I'll Let

the as And at that quarter, So we seen look haven't we hitting fourth those year, at actually the we first that numbers look our of yet. gave end full numbers. outlook you as quarter for we're

a seen haven't orders. in diminution we So

about digital to talk to extremely banking want I So has have strong orders.

business Let's strong. strong [ph] say, our remains

strong a fourth continues year, Our has very had hospitality quarter. through to remain business strong the

the if of seen So end at you look XXXX, through it we haven't that.

concerned. I people think would pop 'XX and we things we macro conversation talk ordering into just seen slow us to media up that red seen tell the going haven't flags, public heading at same stage. haven't down the We to the trends, this customers are that are in our customers,

that? book think of to like else, but know, order at want our just you the to we hit we're looking Owen, I haven't future, that don't cautious seen yet. as add I everybody

they're as I an talked we our technology is cetera, know backlog issue in probably that see with bring. the we spot willing will. next pushing be have to the cost industry bring and the and the to groups will sit a a not the has of that people say self-checkout for to et out would and labor projects And And board. to implementations. technology I the systems, there I think good address to software, supporting of we mix, are labor chatter customers we if that of been we major standpoint, raised have both from there's Yeah. labor, make our year is a pretty the The that retailers, offset material of all three about. across counter table the that investment talking in pressing flags. continues what most to about as or lot Certainly, you that the labor can

approach like will addressed. in out just of now, turns on why if bring. terms we're of are markets what not then we're as now, aggressive of it doing in So taking order pretty Tim That's seeing a overreaction, as albeit But the it. pause get they the be and anticipation. And anxious we'll are are activity, a not or an of that costs right that project to waning. 'XX benefit We're activities to most us delays right

just when back that and guide. revenue margin you just you that. looks be, mentioned headwinds. really, percentage FX - on or just you're just, What sequential again, basis? is Thanks. XXXX flowing headwinds I similar and to again change part would That absolute this And to talking referencing and guidance sure XQ circle an that you're from the Tim, dollar make rental really the cost about to want are you've I the that again, today? arrive to helpful. can maybe perspective, guess assuming kind to Okay. Thank the the you for was detail to that guided a XQ at then offsets through second maybe, back of

sure. Yeah,

year-over-year values. on but those, revenue on be XX% X% a post will So meaning growth to growth about not in rates, rate X% to sequentially a EBITDA. When absolute about rate it XX% similar, and we growth

impact impact flow your The revenue by by to today, We million. looking by now performance. back that impacts currency. on $XXX FX and at it about almost okay currency to million question feel $XX rates EBITDA free million I - cash So to expect $XXX

toward revenue, when are in with I described we're billion you of up some billion of think $X EBITDA or ranges this if if trending our year, approximately billion QX, you talk within of can add $X.X $X.X see those do back of being we those the to well So I you ranges the where FX I effects, them. on add math, just you side our QX about midpoint to on relief,

Thank Perfectly you so much. clear.

My pleasure.

at And we'll RBC. go next to Matthew Roswell

with you A some getting sort all Or the come back. the on and/or macro either et there quick Yes. question is to cash doing reduction, Good that cost better of expectation flow timing anything cetera? in evening. environment solely for there Is free differentials?

Yeah.

change nothing has in presume happen. any earnings. to So profitability. change doesn't of special the our in It remarkable I It quality very doesn't think increase

capital the described which of was fourth we've cash use fact, the a profitability I working to this very just similar got In $XXX year. There of We've quarter, thought in year third. we'd million in relatively folks that million of can million over - to inventory. capital they who $XXX get back. using efforts working flat, hold me own $XX tell AR that cash nearly and those in Those used collect

of gets including reduction, other also million, I of best incentive means of that that effects. hundred That so $XXX north And harvest it to QX whether should been The I it those expect of the predates quarter. flow some my cash another funded cash through that we'll And other year. a flow. those to $XXX working think labor the benefit is capital in in compensation get least likely generate expect There quarter, way some severance a at guess. next I of cash lift salary of we or in XXX(k) million is year see be of fourth - $XXX things there's ability our out generated programs million be paid P&L of our dollars in million from We'll of just free or $XXX million the QX cash still will continuation. have cash couple of to flow this

very much. you Thank Okay.

pleasure. My

with And follow-up Summerville last from Matt to D.A. for go will our question, a Davidson. we

Yes, thanks.

quarter-on-quarter XX, ones. And at that how correctly? looking $XX materially a that the million. an so, R&D looked adjusted like to declined quick run does from figure? Is that it two if Just expense happen? and year-on-year XX-ish, of Am rate I right

I in the so quarter... think don't - that's CapEx I don't

R&D, R&D...

to you... have I'll to Matt, get back

Yes...

I in - which would an development - from do Mike so a is This investment say software in development, lot hardware we and of.

at changed haven't that We all.

changed we So haven't that. quarter-to-quarter, quarter quarter, to

maybe CapEx categorization from there's and action. product spending versus if a it's R&D business So of not a

The it spend relatively has total cash So The the in cap so – at flat. now. spend fact, spend on changed. total I'm rate is R&D looking

meaning cap that the was went OpEx. rate of CapEx than spend to that So more higher,

Is sustainable that forward? Okay. going

was I'd - say in it year. the was half this first cap that rate understated of the

period the changed We the that they that make future capitalizable, to associated that with projects were they of revenue profile had we prioritize meaning also sure them.

reasonably average argue for we're the three. should and buck two of more bang out to close I'd rate getting of So cap be our CapEx our and

a quarter-on-quarter. my that margin surprises me as And product looked to follow-up, be profit Okay. then bit. gross final flat I little guess

And I you the if about okay. look So mean, product takes XX% in there talk your can more not seemed and while getting gross good margin? on skill to pricing, retail. mix the you're better that's volumes roughly puts getting be

So help me going product you. with understand on gross what's margins? Thank

Yeah.

I seen gross We've think just all we're seeing cost year long trying you're with and through pressure. offset the go indirect it to margin, costs.

some we come all we've we've indirect cost in easily, all the it's direct, Obviously, the year the is direct So thus things part, our more to for But most could business pressure will, taken chasing instances, side. been offset cost. it gross cost indirect the In were itself. which through long it's that on this the if doesn't efforts year far control margin.

year. switch that see you'll think next I

do organize done start relief indirect the much I as think We've about some organizations together. as putting still - see to the work year. chain cost, new on two year, can next we next we'll sub-supply in the

be out I think I to direct ultimately, going cost But collapse management. cost of some we story there. think XXXX the is can

you, Got Thank it. guys. That's it me. from

Sure.

I to for And comments. at now back to call Hayford, time, CEO, like closing the Mike this would turn

software-led delivered transformation XX% more a outstanding to EBITDA strategic currency quarter. across Thanks. But KPIs revenue had growth, importantly, on quarter business X% both NCR five basis. strategic improving constant an segments. this team a our we all The growth company, our We as-a-service and continued

it's our is and Sao customers I and many each Atlanta, employees of Sabon, I make thank all for Belgrade, including employees around care success and special the with globe a and Paulo, Tokyo, a member NCR and wonderful to driven every I makes We'll by Prague, close day. take see thank Dundee, to Mumbai the next to others, all you delivered every our efforts each China, a day you quarter, who every and of what Dallas, us. joining time. London, to our want see you team travel NCR work of Our NCR

Thank you for call. conclude participation. does that today's And your

now may disconnect. You