Financial Data and Key Metrics Changes - Total normalized revenue for Q1 2024 was $858 million, a decline of approximately 3% driven by lower hardware revenue due to customer refresh cycles [27] - Normalized software and services revenue increased by 5% to $662 million, while adjusted EBITDA was $122 million, down 2% [27][28] - Adjusted EBITDA margin was 14.2%, slightly higher than the prior year, and adjusted EPS was $0.13 with a weighted diluted average share count of 162.7 million [27] Business Line Data and Key Metrics Changes - In the retail segment, software and services revenue grew by 5%, but total revenue declined by 7% due to hardware declines [29] - The restaurant segment saw software and services revenue grow by 3%, offset by hardware, resulting in a revenue decline of 3% [92] - Digital banking segment revenue increased by 7%, with adjusted EBITDA growing by 10% and margin expanding by 90 basis points [100] Market Data and Key Metrics Changes - The company signed nearly 300 new customers across retail and restaurant segments, indicating strong market demand [81][116] - The digital banking segment registered users grew by 5% to over 28.5 million, with active users increasing by 3% to over 19.7 million [88] Company Strategy and Development Direction - The company is focused on executing its platform strategy and increasing investments in its global sales and services network to drive growth [10][24] - There is a strong emphasis on converting existing customers to the platform and expanding relationships with new customers, particularly in the mid-market [12][24] - The company aims to streamline operations by consolidating its four business lines into a single organization, enhancing sales activity and cost efficiencies [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to execute growth strategies and maximize shareholder value, despite challenges in the hardware business [40][56] - The company anticipates a moderation in hardware revenue decline in the second half of the year, with expectations for sequential improvement in revenue and adjusted EBITDA [36][107] - Management noted that the digital banking business is performing well and is expected to continue growing, with a focus on cross-selling and expanding existing customer relationships [111] Other Important Information - The company is undergoing a $100 million cost-out program, with $70 million benefits expected this year and $30 million flowing into next year [65] - The company reaffirmed its 2024 guidance ranges based on Q1 performance and current visibility for the year [95] Q&A Session Summary Question: What is the outlook for revenue and EBITDA cadence going forward? - Management expects revenue and adjusted EBITDA to sequentially improve as cost transformation initiatives ramp up and hardware-related declines moderate in the second half [36] Question: Any updates on plans to potentially monetize the digital banking asset? - Management continues to explore opportunities to maximize shareholder value, acknowledging the increasing valuations in the market [40] Question: What is the demand outlook for self-checkout products? - Management sees continued demand for self-checkout solutions, driven by consumer preferences for unassisted checkout options [44][106] Question: How does the digital banking segment compare to historical quarterly run rates? - The digital banking segment is performing in line with expectations, with strong customer additions and expansions [50] Question: What are the attrition rates across segments? - The company reports strong retention rates, particularly in enterprise customers, with normal attrition trends continuing [69] Question: What is the expected margin for the restaurant segment going forward? - Management expects the restaurant segment margin to remain in the mid-to-high twenties for the full year [123]
NCR Voyix Corp(VYX) - 2024 Q1 - Earnings Call Transcript