NCR Atleos, LLC ((NATL)) has held its Q1 earnings call. Read on for the main highlights of the call.
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The recent earnings call for NCR Atleos, LLC painted a picture of a strong start to 2025, marked by significant growth in ATM-as-a-Service and improvements in adjusted EBITDA. Despite challenges such as hardware revenue timing and declines in U.K. transaction volumes, the company expressed optimism about future growth and cash flow, maintaining its guidance amidst uncertainties like tariffs.
Strong Financial Performance
NCR Atleos reported a robust financial performance in the first quarter, with core revenue reaching $966 million. The company saw a 9% growth in adjusted EBITDA, which rose to $175 million, and an expansion in adjusted EBITDA margin by 270 basis points to 17.9%. These figures underscore the company’s solid financial footing and operational efficiency.
ATM-as-a-Service Growth
The ATM-as-a-Service segment experienced remarkable growth, with revenue increasing by 24% year-over-year. This growth was driven by a 44% increase in unique customer count and a 54% rise in gross profit, highlighting the strong demand and successful expansion of this service.
Network Segment Expansion
In a strategic move, the Network segment successfully signed 7-Eleven to the Allpoint network. This expansion increases the number of convenient locations available to 75 million cardholders, enhancing the company’s service offering and market reach.
Positive Cash Flow Outlook
The company is optimistic about its cash flow, expecting to generate positive free cash flow in each of the remaining quarters of the year. This outlook reflects NCR Atleos’s effective financial management and strategic planning.
Hardware Revenue Timing
While hardware revenue was down year-over-year in Q1 due to timing issues, NCR Atleos anticipates strong growth in this area for the remainder of the year. This expectation is based on strategic adjustments and market conditions.
U.K. Transaction Volume Decline
The company reported a 6% to 7% decline in withdrawal transactions in the U.K., which was attributed to economic factors and the timing of Easter. This decline highlights some of the external challenges faced by NCR Atleos.
LibertyX Bitcoin Revenue Decline
LibertyX Bitcoin transaction revenue saw a decline due to regulatory changes, impacting the company’s top-line growth. This situation underscores the challenges posed by regulatory environments on emerging financial technologies.
Forward-Looking Guidance
During the earnings call, NCR Atleos provided a positive forward-looking guidance, indicating strong performance and strategic progress. The company reaffirmed its guidance for the full year 2025, projecting core revenue growth of 3% to 6%, adjusted EBITDA growth of 7% to 10%, and adjusted EPS between $3.90 and $4.10. Free cash flow is expected to range from $260 million to $300 million. The company remains focused on mitigating tariff impacts, particularly those related to ATM hardware and parts.
In summary, NCR Atleos, LLC’s earnings call highlighted a strong start to 2025 with significant growth in key areas and a positive outlook for the future. Despite some challenges, the company remains optimistic about its strategic direction and financial performance, maintaining its guidance and focusing on growth opportunities.