NCR Atleos (NATL) Q2 2024 earnings summary

Executive summary

• Q2 2024 results were at or above the high end of guidance, with revenue up 4% year-over-year to $1.081 billion and recurring revenue up 9% to $793 million, representing 73% of total revenue.

• Adjusted EBITDA was $193 million, with a margin of 17.9%, and net income was $29 million, reflecting higher interest and separation-related costs.

• The company reaffirmed and narrowed full-year 2024 guidance, citing strong first-half results, a robust sales pipeline, and ongoing productivity initiatives.

• Strategic and operational initiatives progressed, including successful separation from NCR Voyix, efficiency gains, and expansion of Network Utility Banking and ATM as a Service.

• Continued focus on operational efficiency, asset-light strategies, and leveraging scale as a pure-play ATM company.

Financial highlights

• Q2 2024 revenue was $1.081 billion, up 4% year-over-year; recurring revenue was $793 million, up 9% and now 73% of total revenue.

• Adjusted EBITDA was $193 million (17.9% margin), down 3% year-over-year; GAAP net income was $29 million; non-GAAP diluted EPS was $0.81.

• Adjusted free cash flow for Q2 2024 was $16 million; year-to-date free cash flow reached $85 million.

• Gross margin rate (GAAP) was 23.4%; adjusted gross margin rate was 25.5%.

• Net leverage improved to 3.5x from 3.7x at year-end 2023; cash and cash equivalents at quarter-end were $374 million.

Outlook and guidance

• Full-year 2024 revenue guidance reaffirmed and narrowed to $4.26–$4.34 billion; adjusted EBITDA guidance at $770–$800 million; non-GAAP EPS outlook $2.90–$3.20.

• Adjusted free cash flow guidance for FY 2024 raised to $190–$220 million.

• Q3 2024 revenue guidance is $1.045–$1.075 billion, with adjusted EBITDA of $195–$205 million.

• Self-service banking revenue outlook increased to $2.655–$2.690 billion; network revenue outlook slightly decreased due to LibertyX softness.

• Management expects continued growth in recurring revenue streams and ongoing transition to software-led solutions.