UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 __________________________________________________ Form 10-Q __________________________________________________ ☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-4879 ___________________________________ ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2019 OR ☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-4879 Diebold Nixdorf, Incorporated (Exact name of registrant as specified in its charter) Ohio 34-0183970 (State or other jurisdiction of incorpora ...

```markdown Part I - Financial Information [Item 1: Financial Statements (Unaudited)](index=3&type=section&id=Item%201%3A%20Financial%20Statements%20(Unaudited)) Unaudited financial statements for Q3 2019 show a reduced net loss, decreased total assets, and the adoption of ASC 842 [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) | Account | Sep 30, 2019 | Dec 31, 2018 | | :--- | :--- | :--- | | **Assets** | | | | Cash, cash equivalents and restricted cash | $252.3 | $458.4 | | Total current assets | $1,870.4 | $2,203.4 | | Goodwill | $773.4 | $827.1 | | Total assets | $3,889.1 | $4,311.9 | | **Liabilities & Equity** | | | | Total current liabilities | $1,546.1 | $1,568.4 | | Long-term debt | $2,100.3 | $2,190.0 | | Total liabilities | $4,314.3 | $4,341.1 | | Total equity | $(425.2) | $(159.6) | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) | Metric | Three Months Ended Sep 30, 2019 | Three Months Ended Sep 30, 2018 | Nine Months Ended Sep 30, 2019 | Nine Months Ended Sep 30, 2018 | | :--- | :--- | :--- | :--- | :--- | | Net Sales | $1,078.8 | $1,119.0 | $3,257.1 | $3,288.8 | | Gross Profit | $271.5 | $228.9 | $796.7 | $689.0 | | Operating Profit (Loss) | $23.2 | $(160.3) | $6.0 | $(310.4) | | Net Loss | $(34.8) | $(244.6) | $(222.0) | $(438.5) | | Basic and Diluted Loss Per Share | $(0.46) | $(3.13) | $(2.86) | $(5.86) | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) | Cash Flow Activity | Nine Months Ended Sep 30, 2019 | Nine Months Ended Sep 30, 2018 | | :--- | :--- | :--- | | Net cash provided (used) by operating activities | $7.4 | $(372.1) | | Net cash provided by investing activities | $10.2 | $90.1 | | Net cash (used) provided by financing activities | $(184.9) | $196.9 | | Decrease in cash, cash equivalents and restricted cash | $(174.5) | $(99.5) | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, lease standard adoption, restructuring, debt, legal contingencies, and corporate structure - The company adopted the new lease accounting standard ASC 842 on January 1, 2019, recognizing right-of-use (ROU) assets and corresponding lease liabilities on the balance sheet. This resulted in the recognition of **$169.1 million** in operating ROU assets[26](index=26&type=chunk)[40](index=40&type=chunk) - The DN Now transformation program, initiated in Q2 2018, targets approximately **$400 million** in gross annualized savings through 2021. Restructuring charges of **$19.8 million** were incurred in the first nine months of 2019, primarily for severance[77](index=77&type=chunk) - In May 2019, the company completed the merger/squeeze-out of Diebold Nixdorf AG, increasing its ownership to **100%** and streamlining its corporate structure. This resulted in a significant reduction of the redeemable noncontrolling interests balance[101](index=101&type=chunk) - The company is party to legal proceedings, including appraisal proceedings in Germany related to the Diebold Nixdorf AG acquisition and putative class action lawsuits in the U.S. alleging violations of federal securities laws[142](index=142&type=chunk)[147](index=147&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=44&type=section&id=Item%202%3A%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses performance, highlighting the DN Now program, improved gross margin, and significantly better operating cash flow [Overview and Strategy](index=54&type=section&id=Overview%20and%20Strategy) - The company's strategy is to enable Connected Commerce by integrating hardware, software, and services to enhance the consumer experience in banking and retail, while streamlining costs for its clients[185](index=185&type=chunk)[186](index=186&type=chunk) - The DN Now transformation program is a key strategic initiative focused on improving operational excellence, streamlining the operating model, modernizing services, optimizing the product portfolio, and reducing expenses. The program targets approximately **$400 million** in gross annualized savings through 2021[187](index=187&type=chunk) [Results of Operations](index=58&type=section&id=Results%20of%20Operations) Net Sales by Segment - Nine Months Ended Sep 30 (in millions) | Segment | 2019 | 2018 | % Change | % Change in CC | | :--- | :--- | :--- | :--- | :--- | | Eurasia Banking | $1,218.0 | $1,306.9 | (6.8)% | (1.4)% | | Americas Banking | $1,186.3 | $1,086.8 | 9.2% | 10.1% | | Retail | $852.8 | $895.1 | (4.7)% | 1.1% | | **Total** | **$3,257.1** | **$3,288.8** | **(1.0)%** | **3.2%** | Gross Profit and Margin - Nine Months Ended Sep 30 | Metric | 2019 | 2018 | | :--- | :--- | :--- | | Gross Profit | $796.7M | $689.0M | | Gross Margin | 24.5% | 20.9% | | Services Gross Margin | 26.3% | 22.8% | | Products Gross Margin | 21.8% | 17.9% | - Operating loss for the nine months ended Sep 30, 2019 improved to **$6.0 million** from a loss of **$310.4 million** in the prior year, primarily due to the absence of the **$217.5 million** goodwill impairment charge recorded in 2018 and improved gross profit[231](index=231&type=chunk) - Interest expense for the nine months ended Sep 30, 2019 increased by **$53.7 million** to **$153.3 million**, mainly due to the additional **$650.0 million** Term Loan A-1 Facility with higher interest rates[233](index=233&type=chunk) [Liquidity and Capital Resources](index=67&type=section&id=Liquidity%20and%20Capital%20Resources) Total Cash and Availability (in millions) | Component | Sep 30, 2019 | Dec 31, 2018 | | :--- | :--- | :--- | | Cash and cash equivalents | $248.7 | $353.1 | | Revolving Facility Availability | $385.8 | $347.5 | | **Total cash and cash availability** | **$716.4** | **$762.1** | - Net cash provided by operating activities was **$7.4 million** for the first nine months of 2019, a significant improvement of **$379.5 million** from a use of **$372.1 million** in the same period of 2018. This was driven by a lower net loss and better working capital management[255](index=255&type=chunk) - The company successfully amended and extended the majority of its revolving credit facility and term A loans from a December 2020 maturity to April 2022[183](index=183&type=chunk) - The ratio of net debt to trailing 12 months adjusted EBITDA was **4.7 times** as of September 30, 2019, and the company was in compliance with its debt covenants[263](index=263&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=71&type=section&id=Item%203%3A%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes in market risk exposures have occurred since the 2018 Annual Report on Form 10-K - There have been no material changes in the company's market risk exposures since December 31, 2018[277](index=277&type=chunk) [Controls and Procedures](index=72&type=section&id=Item%204%3A%20Controls%20and%20Procedures) Management concluded disclosure controls were ineffective due to three ongoing material weaknesses in internal control over financial reporting - The CEO and CFO concluded that disclosure controls and procedures were not effective as of September 30, 2019[282](index=282&type=chunk) - The ineffectiveness is due to three material weaknesses identified as of December 31, 2018, which were not yet remediated. These weaknesses relate to: - Ineffective information technology general controls (ITGCs) - Ineffective controls over inventory valuation - Ineffective controls over non-routine transactions[283](index=283&type=chunk)[284](index=284&type=chunk)[285](index=285&type=chunk)[286](index=286&type=chunk) - A remediation plan is being implemented, which includes improving the risk assessment process, revoking inappropriate IT access, refining inventory valuation procedures, and enhancing controls over non-routine transaction calculations[288](index=288&type=chunk)[289](index=289&type=chunk) Part II - Other Information [Legal Proceedings](index=74&type=section&id=Item%201%3A%20Legal%20Proceedings) No material developments in legal proceedings have occurred since the 2018 Annual Report on Form 10-K - There have been no material developments with respect to legal proceedings reported in the Company's annual report on Form 10-K for the year ended December 31, 2018[293](index=293&type=chunk) [Risk Factors](index=74&type=section&id=Item%201A%3A%20Risk%20Factors) No material changes to the company's risk factors have occurred since the 2018 Annual Report on Form 10-K - There has been no material change to the company's risk factors since December 31, 2018[294](index=294&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=74&type=section&id=Item%202%3A%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q3 2019, the company repurchased **3,721 shares** at an average price of **$9.81**, related to share-based compensation plans Share Repurchases - Q3 2019 | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | July | 2,060 | $9.58 | | August | 369 | $12.55 | | September | 1,292 | $9.39 | | **Total** | **3,721** | **$9.81** | - All shares repurchased were surrendered to the Company in connection with its share-based compensation plans[295](index=295&type=chunk) [Exhibits](index=75&type=section&id=Item%206%3A%20Exhibits) This section lists exhibits filed with the Form 10-Q, including corporate governance documents, credit agreement amendments, and certifications - Key exhibits filed include the Seventh Amendment to the Credit Agreement dated August 7, 2019, and certifications by the CEO and CFO pursuant to the Sarbanes-Oxley Act[300](index=300&type=chunk) ```

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 __________________________________________________ Form 10-Q __________________________________________________ ☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2019 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-4879 ____________________________________ ...

Part I – Financial Information [Item 1: Financial Statements](index=3&type=section&id=Item%201%3A%20Financial%20Statements) Diebold Nixdorf reported Q1 2019 net sales of $1,028.1 million, a net loss of $131.9 million, and improved operating cash flow [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheet Highlights (in millions) | Account | March 31, 2019 (Unaudited) | December 31, 2018 | | :--- | :--- | :--- | | **Assets** | | | | Cash, cash equivalents and restricted cash | $377.9 | $458.4 | | Total current assets | $2,137.3 | $2,203.4 | | Goodwill | $813.6 | $827.1 | | Total assets | $4,327.3 | $4,311.9 | | **Liabilities & Equity** | | | | Total current liabilities | $1,654.5 | $1,568.4 | | Long-term debt | $2,191.2 | $2,190.0 | | Total liabilities | $4,211.2 | $4,341.1 | | Total equity | ($274.7) | ($159.6) | - The company adopted the new lease accounting standard (ASC 842) as of January 1, 2019, resulting in the recognition of **$173.3 million** in Right-of-use lease assets and corresponding current (**$61.7 million**) and long-term (**$110.4 million**) lease liabilities[8](index=8&type=chunk)[26](index=26&type=chunk) [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Condensed Consolidated Statements of Operations (in millions, except per share data) | Metric | Three Months Ended March 31, 2019 | Three Months Ended March 31, 2018 | | :--- | :--- | :--- | | Net Sales | $1,028.1 | $1,064.2 | | Gross Profit | $244.1 | $238.4 | | Operating Loss | ($24.5) | ($23.5) | | Loss Before Taxes | ($71.1) | ($47.5) | | Net Loss | ($131.9) | ($65.6) | | Net Loss Attributable to Diebold Nixdorf | ($132.7) | ($73.2) | | Basic and Diluted Loss Per Share | ($1.74) | ($0.97) | - Interest expense significantly increased to **$50.9 million** from **$26.0 million** year-over-year, contributing to the wider net loss[14](index=14&type=chunk) - The company declared and paid **no dividends** per common share in Q1 2019, compared to **$0.10 per share** in Q1 2018[14](index=14&type=chunk) [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) Comprehensive Loss Summary (in millions) | Metric | Three Months Ended March 31, 2019 | Three Months Ended March 31, 2018 | | :--- | :--- | :--- | | Net Loss | ($131.9) | ($65.6) | | Other comprehensive income (loss), net of tax | $1.6 | ($9.2) | | Comprehensive Loss | ($130.3) | ($74.8) | | Comprehensive Loss Attributable to Diebold Nixdorf | ($133.8) | ($82.4) | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Condensed Consolidated Statements of Cash Flows (in millions) | Cash Flow Activity | Three Months Ended March 31, 2019 | Three Months Ended March 31, 2018 | | :--- | :--- | :--- | | Net cash used by operating activities | ($57.1) | ($142.3) | | Net cash (used) provided by investing activities | ($11.5) | $33.2 | | Net cash used by financing activities | ($13.9) | ($91.4) | | Decrease in cash, cash equivalents and restricted cash | ($83.0) | ($179.0) | | Cash, cash equivalents and restricted cash at end of period | $377.9 | $364.2 | - The significant improvement in operating cash flow was primarily driven by better management of working capital, including a **$50.9 million** positive swing in trade receivables and a **$27.1 million** reduction in cash used for inventories compared to the prior year[21](index=21&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) - The company adopted the new lease accounting standard (ASU 2016-02) on January 1, 2019, recognizing Right-of-Use (ROU) assets of **$175.3 million** and lease liabilities of **$174.2 million** (Note 2)[26](index=26&type=chunk)[40](index=40&type=chunk) - Restructuring charges of **$3.8 million** were incurred in Q1 2019 related to the DN Now program, which aims for approximately **$160 million** in savings for 2019 (Note 10)[75](index=75&type=chunk)[76](index=76&type=chunk) - As of March 31, 2019, the company was in compliance with its debt covenants, which include a maximum total net debt to adjusted EBITDA leverage ratio of **7.00 to 1.00** (Note 11)[92](index=92&type=chunk)[95](index=95&type=chunk) - The company's reportable operating segments are Eurasia Banking, Americas Banking, and Retail. For Q1 2019, total segment operating profit was **$60.3 million**, up from **$34.7 million** in Q1 2018 (Note 20)[137](index=137&type=chunk)[140](index=140&type=chunk) [Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations](index=44&type=section&id=Item%202%3A%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Net sales decreased 3.4% to $1,028.1 million, while gross margin improved; the DN Now program targets $400 million in savings [Overview and Strategy](index=44&type=section&id=Overview%20and%20Strategy) - The company is a world leader in enabling Connected Commerce, automating and digitizing banking and shopping through integrated solutions[167](index=167&type=chunk) - The company's strategy focuses on enhancing consumer experience while streamlining costs through the integration of hardware, software, and services[168](index=168&type=chunk) - The DN Now transformation program is a key strategic initiative focused on improving operational excellence and customer centricity. It targets gross annualized savings of approximately **$400 million** through 2021, with **$160 million** anticipated in 2019[169](index=169&type=chunk)[171](index=171&type=chunk) [Results of Operations](index=47&type=section&id=Results%20of%20Operations) Net Sales by Segment (in millions) | Segment | Q1 2019 | Q1 2018 | % Change | % Change (Constant Currency) | | :--- | :--- | :--- | :--- | :--- | | Eurasia Banking | $382.6 | $435.1 | (12.1)% | (4.2)% | | Americas Banking | $362.7 | $333.7 | 8.7% | 10.6% | | Retail | $282.8 | $295.4 | (4.3)% | 4.2% | | **Total Net Sales** | **$1,028.1** | **$1,064.2** | **(3.4)%** | **3.0%** | - Total gross margin improved to **23.7%** from **22.4%** year-over-year, with product gross margin increasing significantly to **22.3%** from **19.0%** due to favorable solution mix and volume in North America[194](index=194&type=chunk)[195](index=195&type=chunk) - Operating loss was relatively flat at (**$24.5 million**) compared to (**$23.5 million**) in the prior year. Excluding currency and non-routine charges, operating profit increased by **$13.0 million**[203](index=203&type=chunk) - Interest expense nearly doubled to **$50.9 million** from **$26.0 million**, primarily due to the additional **$650.0 million** Term Loan A-1 Facility acquired[204](index=204&type=chunk)[206](index=206&type=chunk) - The effective tax rate was (**85.0%)**, resulting in tax expense on a pre-tax loss, primarily due to the impacts of the U.S. Tax Act (GILTI and BEAT) and the collapse of the company's Barbados structure[207](index=207&type=chunk) [Liquidity and Capital Resources](index=54&type=section&id=Liquidity%20and%20Capital%20Resources) Total Cash and Cash Availability (in millions) | Component | March 31, 2019 | December 31, 2018 | | :--- | :--- | :--- | | Cash and cash equivalents | $284.4 | $353.1 | | Uncommitted lines of credit | $32.4 | $28.0 | | Revolving Facility | $337.5 | $347.5 | | Short-term investments | $31.5 | $33.5 | | **Total** | **$685.8** | **$762.1** | - Net cash used by operating activities improved significantly to (**$57.1 million**) from (**$142.3 million**) in Q1 2018, driven by better working capital management[222](index=222&type=chunk)[223](index=223&type=chunk) - The ratio of net debt to trailing 12 months adjusted EBITDA was **5.7 times** as of March 31, 2019[231](index=231&type=chunk) - In May 2018, the company reallocated future dividend funds towards debt reduction, resulting in **no dividend payment** in Q1 2019, compared to a **$7.7 million** payment in Q1 2018[232](index=232&type=chunk) [Item 3: Quantitative and Qualitative Disclosures About Market Risk](index=59&type=section&id=Item%203%3A%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes in market risk exposures have occurred since the 2018 Annual Report on Form 10-K - There have been **no material changes** in market risk exposures since December 31, 2018[246](index=246&type=chunk) [Item 4: Controls and Procedures](index=60&type=section&id=Item%204%3A%20Controls%20and%20Procedures) Disclosure controls and procedures were ineffective due to three material weaknesses in internal control over financial reporting - The CEO and CFO concluded that disclosure controls and procedures were **not effective** as of March 31, 2019[251](index=251&type=chunk) - The ineffectiveness is due to **three material weaknesses** in internal control over financial reporting that were not remediated during the quarter[252](index=252&type=chunk) - The material weaknesses relate to: 1) Ineffective risk assessment process and related IT general controls (ITGCs), 2) Ineffective controls over inventory valuation, and 3) Ineffective controls over non-routine transactions[253](index=253&type=chunk)[254](index=254&type=chunk)[255](index=255&type=chunk) - A remediation plan is underway to improve risk assessment, communication, IT access controls, inventory valuation controls, and controls over non-routine transaction calculations[257](index=257&type=chunk) Part II - Other Information [Item 1: Legal Proceedings](index=62&type=section&id=Item%201%3A%20Legal%20Proceedings) No material developments in legal proceedings have occurred since the 2018 Annual Report on Form 10-K - There have been **no material developments** in legal proceedings since the 2018 Form 10-K[261](index=261&type=chunk) [Item 1A: Risk Factors](index=62&type=section&id=Item%201A%3A%20Risk%20Factors) No material changes to the company's risk factors have occurred since December 31, 2018 - There has been **no material change** to the company's risk factors since December 31, 2018[262](index=262&type=chunk) [Item 2: Unregistered Sales of Equity Securities and Use of Proceeds](index=62&type=section&id=Item%202%3A%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 193,501 shares at an average price of $5.91 in Q1 2019 for share-based compensation plans Share Repurchases in Q1 2019 | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | January | 771 | $3.61 | | February | 188,775 | $5.92 | | March | 3,955 | $6.06 | | **Total** | **193,501** | **$5.91** | - All shares repurchased were surrendered in connection with the company's share-based compensation plans[263](index=263&type=chunk) [Item 5: Other Information](index=63&type=section&id=Item%205%3A%20Other%20Information) No other information was reported for this item - None[267](index=267&type=chunk) [Item 6: Exhibits](index=63&type=section&id=Item%206%3A%20Exhibits) This section lists exhibits filed, including corporate governance documents, agreements, and CEO/CFO certifications - Key exhibits filed include a Nomination and Standstill Agreement, the amended 2017 Equity and Performance Incentive Plan, and CEO/CFO certifications pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act[268](index=268&type=chunk)

Part I [Item 1: Business](index=3&type=section&id=Item%201%3A%20Business) Diebold Nixdorf leads in 'Connected Commerce,' offering integrated solutions, services, and technology for banking and retail, focusing on consumer experience and operational efficiency via its 'DN Now' program - The company's **core strategy is to enhance** consumer banking and shopping experiences by integrating hardware, software, and services, while streamlining costs[8](index=8&type=chunk) - The **'DN Now' transformation program is a multi-year initiative** aimed at improving operational excellence and customer focus. It targets approximately **$400 million** in gross annualized savings through **2021**, with **$160 million** anticipated in **2019**[9](index=9&type=chunk) - The business is structured into two **primary customer segments**: **Banking** (serving financial institutions) and **Retail** (serving retailers), offering a **portfolio of services, software, and systems**[10](index=10&type=chunk) Product Backlog (as of Dec 31) | Year | Product Backlog (in millions) | | :--- | :--- | | **2018** | **$1,012.7** | | **2017** | **$1,026.7** | - The company competes with **major players** such as NCR, Nautilus Hyosung, and GRG Banking in the banking sector, and with firms like Toshiba, Fujitsu, and Oracle in the retail market[25](index=25&type=chunk)[28](index=28&type=chunk) [Item 1A: Risk Factors](index=7&type=section&id=Item%201A%3A%20Risk%20Factors) The company faces significant risks from its 2016 acquisition, high debt, DN Now execution, operational challenges, competition, international volatility, cybersecurity, and internal control weaknesses - The company may fail to realize the **anticipated strategic and financial benefits** from the **2016 acquisition** of **Diebold Nixdorf AG** and may not achieve the goals of its **DN Now transformation program**, which could **adversely affect operating results**[43](index=43&type=chunk)[46](index=46&type=chunk) - A **high level of indebtedness and restrictive covenants** in debt agreements could make it **difficult to service or refinance debt**, **limiting operational flexibility**. The **revolving credit facility** and **Term Loan A Facility** mature in **December 2020**[50](index=50&type=chunk)[52](index=52&type=chunk)[57](index=57&type=chunk) - **International operations**, which accounted for **77.1% of revenue in 2018**, expose the company to risks such as **currency fluctuations, political instability, and changes in trade policies**, including **U.S. tariffs on goods imported from China**[95](index=95&type=chunk)[96](index=96&type=chunk)[99](index=99&type=chunk) - The company recorded a **$217.5 million non-cash goodwill impairment loss** for the year ended **December 31, 2018**, and **future impairments could occur** if **market conditions or assumptions change**[108](index=108&type=chunk) - **Management identified material weaknesses** in **internal control over financial reporting** as of **December 31, 2018**, related to **information technology general controls (ITGCs)**, **inventory valuation**, and **controls over non-routine transactions**[128](index=128&type=chunk) [Item 1B: Unresolved Staff Comments](index=18&type=section&id=Item%201B%3A%20Unresolved%20Staff%20Comments) The company reports that it has no unresolved staff comments from the U.S. Securities and Exchange Commission - There were **no unresolved staff comments** as of the **filing date**[153](index=153&type=chunk) [Item 2: Properties](index=18&type=section&id=Item%202%3A%20Properties) The company maintains its corporate office in North Canton, Ohio, with manufacturing in North Carolina, Brazil, and Germany, alongside global administrative and sales offices - The company owns or leases **manufacturing facilities in Greensboro, North Carolina; Brazil; and Germany**[154](index=154&type=chunk) - **Principal administrative, sales, and service offices** are located across the **Americas, EMEA (Europe, Middle East, and Africa), and AP (Asia Pacific) regions**[154](index=154&type=chunk) [Item 3: Legal Proceedings](index=18&type=section&id=Item%203%3A%20Legal%20Proceedings) The company faces routine lawsuits and significant indirect tax contingencies, with an estimated aggregate risk of up to $106.1 million, mainly from Thailand customs duties - The company is challenging multiple **customs rulings in Thailand** regarding **retroactive duties** on **ATM imports**. Management believes it has a **valid legal position** and has not accrued for this contingency[158](index=158&type=chunk)[160](index=160&type=chunk) - In **2018**, a **$4.9 million** accrual related to a **Brazil indirect tax matter** was **fully reversed** after the **statute of limitations expired**[160](index=160&type=chunk) - The **estimated aggregate risk** for **material indirect tax matters** was up to **$106.1 million** as of **December 31, 2018**, including **$27.0 million** for the **Thailand customs matter**[161](index=161&type=chunk) [Item 4: Mine Safety Disclosures](index=19&type=section&id=Item%204%3A%20Mine%20Safety%20Disclosures) This item is not applicable to the company - The company has **no mine safety disclosures to report**[162](index=162&type=chunk) Part II [Item 5: Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=20&type=section&id=Item%205%3A%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) DBD shares trade on NYSE, experiencing significant 2018 volatility; annualized dividends were reduced to $0.10, with no Q4 2018 share repurchases Common Stock Price Range (DBD) | Year | High ($) | Low ($) | | :--- | :--- | :--- | | **2018** | **19.05** | **2.41** | | **2017** | **31.85** | **16.00** | | **2016** | **29.80** | **21.05** | Annualized Dividends Per Share | Year | Dividend per Share ($) | | :--- | :--- | | **2018** | **0.10** | | **2017** | **0.40** | | **2016** | **0.96** | [Item 6: Selected Financial Data](index=22&type=section&id=Item%206%3A%20Selected%20Financial%20Data) This section summarizes five-year financial data, showing 2018 net sales flat at $4.6 billion, a $(566.0) million net loss, and total debt increasing to $2.24 billion Selected Financial Data (in millions, except per share data) | Metric | 2018 | 2017 | 2016 | 2015 | 2014 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Net sales** | **$4,578.6** | **$4,609.3** | **$3,316.3** | **$2,419.3** | **$2,734.8** | | **(Loss) income from continuing operations** | **$(566.0)** | **$(213.9)** | **$(179.3)** | **$57.8** | **$104.7** | | **Loss per share from continuing operations** | **$(7.48)** | **$(3.20)** | **$(2.68)** | **$0.89** | **$1.62** | | **Common dividends paid per share** | **$0.10** | **$0.40** | **$0.96** | **$1.15** | **$1.15** | | **Total assets** | **$4,311.9** | **$5,222.0** | **$5,270.3** | **$2,242.4** | **$2,342.1** | | **Total debt** | **$2,239.5** | **$1,853.8** | **$1,798.3** | **$638.2** | **$505.4** | [Item 7: Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%207%3A%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In 2018, Diebold Nixdorf pursued its DN Now program, saw net sales decrease by 0.7% to $4.6 billion, a $(566.0) million net loss due to impairment, and negative operating cash flow, while raising $650 million in new debt [Results of Operations: 2018 vs 2017](index=24&type=section&id=Results%20of%20Operations%3A%202018%20vs%202017) In 2018, net sales decreased by 0.7% to $4,578.6 million, operating loss widened to $(362.9) million due to a goodwill impairment, gross margin contracted, and net loss increased to $(566.0) million Net Sales by Segment (2018 vs 2017, in millions) | Segment | 2018 | 2017 | % Change | | :--- | :--- | :--- | :--- | | **Eurasia Banking** | **$1,800.2** | **$1,903.4** | **(5.4)%** | | **Americas Banking** | **$1,515.7** | **$1,525.6** | **(0.6)%** | | **Retail** | **$1,262.7** | **$1,180.3** | **7.0%** | | **Total net sales** | **$4,578.6** | **$4,609.3** | **(0.7)%** | Key Profitability Metrics (2018 vs 2017, in millions) | Metric | 2018 | 2017 | | :--- | :--- | :--- | | **Gross Profit** | **$890.9** | **$999.8** | | **Gross Margin** | **19.5%** | **21.7%** | | **Operating Loss** | **$(362.9)** | **$(93.5)** | | **Net Loss from Continuing Operations** | **$(566.0)** | **$(213.9)** | - The **significant increase in operating loss** was primarily driven by a **non-cash goodwill impairment charge** of **$217.5 million** recorded in **2018**[197](index=197&type=chunk)[199](index=199&type=chunk) [Results of Operations: 2017 vs 2016](index=29&type=section&id=Results%20of%20Operations%3A%202017%20vs%202016) Fiscal year 2017 saw net sales increase by 39.0% to $4,609.3 million due to the Diebold Nixdorf AG acquisition, while operating loss narrowed to $(93.5) million despite acquisition-related costs Net Sales by Segment (2017 vs 2016, in millions) | Segment | 2017 | 2016 | % Change | | :--- | :--- | :--- | :--- | | **Eurasia Banking** | **$1,903.4** | **$1,232.6** | **54.4%** | | **Americas Banking** | **$1,525.6** | **$1,567.3** | **(2.7)%** | | **Retail** | **$1,180.3** | **$516.4** | **128.6%** | | **Total net sales** | **$4,609.3** | **$3,316.3** | **39.0%** | - The **significant increase in net sales** was primarily driven by **incremental revenue** of **$1,517.7 million** from the **2016 acquisition** of **Diebold Nixdorf AG**[218](index=218&type=chunk) - The **operating loss decreased** to **$(93.5) million** in **2017** from **$(169.8) million** in **2016**, as **higher gross margin** from the acquisition more than offset **increased operating expenses**[233](index=233&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) In 2018, liquidity weakened with cash and availability decreasing to $762.1 million, net cash used in operations was $(104.1) million, debt increased via a new $650 million term loan, and dividends were reduced Consolidated Cash Flow Summary (in millions) | Cash Flow Activity | 2018 | 2017 | 2016 | | :--- | :--- | :--- | :--- | | **Operating activities** | **$(104.1)** | **$37.1** | **$39.3** | | **Investing activities** | **$34.4** | **$(120.8)** | **$(923.3)** | | **Financing activities** | **$10.9** | **$(63.7)** | **$881.3** | - **Total cash and cash availability decreased** from **$1,278.5 million** at **year-end 2017** to **$762.1 million** at **year-end 2018**[252](index=252&type=chunk) - In **May 2018**, the company decided to **reallocate future dividend funds towards debt reduction** and other capital needs, after paying dividends of **$7.7 million** in **2018**[267](index=267&type=chunk) [Critical Accounting Policies and Estimates](index=36&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) Critical accounting policies involve revenue recognition (Topic 606 adopted in 2018), goodwill impairment (significant charge in 2018), and complex income tax estimates due to global operations and the 2017 U.S. Tax Act - The company **adopted ASU Topic 606 (Revenue from Contracts with Customers)** on **January 1, 2018**, using the **cumulative effect method**, resulting in a **$4.6 million increase** to **retained earnings**[388](index=388&type=chunk)[389](index=389&type=chunk)[443](index=443&type=chunk) - **Goodwill is tested for impairment** at the **reporting unit level**. The fair value of reporting units is determined using a combination of **income and market approaches**, which rely on **significant estimates** like **future cash flows, discount rates, and growth rates**[297](index=297&type=chunk)[298](index=298&type=chunk) - The company's **accounting for income taxes involves complex estimates** regarding **deferred tax assets and liabilities, valuation allowances, and uncertain tax positions**, particularly following the **2017 U.S. Tax Act**[303](index=303&type=chunk)[304](index=304&type=chunk) [Item 7A: Quantitative and Qualitative Disclosures About Market Risk](index=42&type=section&id=Item%207A%3A%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from foreign currency and interest rates; a 10% adverse FX movement would decrease 2018 operating profit by $9.1 million, and a 1% interest rate increase would raise interest expense by $14.6 million - A **hypothetical 10% adverse movement** in foreign exchange rates would have **decreased 2018 operating profit** by **$9.1 million**[317](index=317&type=chunk) - A **one percentage point increase** in interest rates would have **increased 2018 interest expense** by **$14.6 million**[319](index=319&type=chunk) [Item 8: Financial Statements and Supplementary Data](index=43&type=section&id=Item%208%3A%20Financial%20Statements%20and%20Supplementary%20Data) This section presents audited financial statements for 2016-2018; KPMG LLP issued an unqualified opinion on financials but an adverse opinion on internal control effectiveness due to material weaknesses as of December 31, 2018 - The **independent auditor, KPMG LLP, issued an adverse opinion** on the **effectiveness of the company's internal control over financial reporting** as of **December 31, 2018**[327](index=327&type=chunk)[333](index=333&type=chunk) - **Material weaknesses were identified** related to **ineffective controls** over **information technology general controls (user access)**, **inventory valuation**, and **non-routine transactions**[335](index=335&type=chunk) [Item 9: Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=107&type=section&id=Item%209%3A%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) This item is not applicable to the company - The company reports **no changes in or disagreements with its accountants** on accounting and financial disclosure[643](index=643&type=chunk) [Item 9A: Controls and Procedures](index=107&type=section&id=Item%209A%3A%20Controls%20and%20Procedures) Management concluded disclosure controls were not effective as of December 31, 2018, due to material weaknesses in IT general controls, inventory valuation, and non-routine transactions, with a remediation plan underway - The **CEO** and **CFO** concluded that **disclosure controls and procedures were not effective** as of **December 31, 2018**[645](index=645&type=chunk) - **Material weaknesses were identified** in: (1) **IT general controls** related to user access, (2) controls over **inventory valuation**, and (3) controls over **non-routine transactions**[650](index=650&type=chunk)[651](index=651&type=chunk)[653](index=653&type=chunk) - A **remediation plan is underway**, which includes **improving the risk assessment process**, **enhancing communication**, **revoking inappropriate IT access**, and **implementing more precise controls**[658](index=658&type=chunk) [Item 9B: Other Information](index=108&type=section&id=Item%209B%3A%20Other%20Information) There is no other information to report under this item - **None**[659](index=659&type=chunk) Part III [Item 10: Directors, Executive Officers and Corporate Governance](index=109&type=section&id=Item%2010%3A%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) This section details executive officers, including CEO Gerrard B. Schmid and CFO Jeffrey L. Rutherford, confirms a Code of Business Ethics, and incorporates director and governance information by reference from the 2019 proxy statement - **Most information for this item**, including details on **directors and the audit committee**, is incorporated by reference from the **2019 Annual Meeting Proxy Statement**[663](index=663&type=chunk) - The **company maintains a Code of Business Ethics (COBE)** applicable to all directors, officers, and employees[664](index=664&type=chunk) [Item 11: Executive Compensation](index=109&type=section&id=Item%2011%3A%20Executive%20Compensation) Information regarding executive and director compensation is incorporated by reference from the company's proxy statement for the 2019 Annual Meeting - **All information related to executive compensation is incorporated by reference** from the **2019 Annual Meeting Proxy Statement**[666](index=666&type=chunk) [Item 12: Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=110&type=section&id=Item%2012%3A%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) This section, largely referenced from the 2019 proxy statement, includes equity compensation plan details, showing 7.1 million securities issuable and 3.6 million available for future issuance as of year-end 2018 Equity Compensation Plan Information (as of Dec 31, 2018) | Plan Category | Securities to be Issued Upon Exercise (a) | Weighted-Average Exercise Price (b) | Securities Remaining for Future Issuance (c) | | :--- | :--- | :--- | :--- | | **Equity compensation plans approved by security holders** | **7,144,217** | **$27.05** | **3,600,000** | [Item 13: Certain Relationships and Related Transactions and Director Independence](index=110&type=section&id=Item%2013%3A%20Certain%20Relationships%20and%20Related%20Transactions%20and%20Director%20Independence) Information regarding related party transactions and director independence is incorporated by reference from the company's proxy statement for the 2019 Annual Meeting - **All information for this item is incorporated by reference** from the **2019 Annual Meeting Proxy Statement**[670](index=670&type=chunk) [Item 14: Principal Accountant Fees and Services](index=110&type=section&id=Item%2014%3A%20Principal%20Accountant%20Fees%20and%20Services) Information regarding fees paid to the principal accountant, KPMG LLP, and the services provided is incorporated by reference from the company's proxy statement for the 2019 Annual Meeting - **All information for this item is incorporated by reference** from the **2019 Annual Meeting Proxy Statement**[671](index=671&type=chunk) Part IV [Item 15: Exhibits and Financial Statement Schedules](index=111&type=section&id=Item%2015%3A%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists all Form 10-K exhibits, including financial statements, various agreements, compensatory plans, and certifications, with all financial statement schedules omitted - This item lists the **financial statements, financial statement schedules (all omitted), and exhibits filed with the annual report**[673](index=673&type=chunk)[674](index=674&type=chunk) - **Exhibits include key corporate documents, debt agreements, employment and compensation plans, and certifications by the CEO and CFO**[674](index=674&type=chunk)[676](index=676&type=chunk)[677](index=677&type=chunk) [Item 16: Form 10-K Summary](index=115&type=section&id=Item%2016%3A%20Form%2010-K%20Summary) The company did not provide a summary under this optional item - **None**[680](index=680&type=chunk)