Executive Summary

Q4 2024 delivered broad-based outperformance: revenue $1.108B (+1% YoY), adjusted EBITDA $219M (+23% YoY, 19.8% margin +360 bps), and non-GAAP diluted EPS $1.11 (+73% YoY); FCF (adj.) $119M, capping FY24 EPS $3.22 and FCF (adj.) $242M above targets .
Self-Service Banking (SSB) grew 8% to $718M with mix shift to services/software lifting segment EBITDA to $181M (25.2% margin); Network EBITDA margin reached 36% on strong transaction growth despite modest revenue decline from FX/LibertyX headwinds .
FY25 outlook points to continued operating leverage: core revenue +3–6% cc (FX -2%), Adj. EBITDA +7–10% cc (FX -1%), non-GAAP EPS $3.90–$4.10, FCF (adj.) $260–$300M; SSB margins mid-20s; Network margin ~29% due to vault cash hedge roll-offs .
Management emphasized structural drivers (higher services capture/ATMaaS, transaction expansion, early-stage hardware refresh) and deleveraging; discussed potential buybacks once net leverage is ~3x mid-2025; new CFO effective Jan 27, 2025 .
Wall Street consensus (S&P Global) could not be retrieved at this time; company stated Q4 EPS exceeded expectations. Consensus-based comparisons therefore remain unavailable.

What Went Well and What Went Wrong

What Went Well
- Services-led mix and productivity drove margin expansion: Q4 Adj. EBITDA margin 19.8% (+360 bps YoY) as services/software grew mid-single digit and recurring mix remained high (71%) .
- SSB momentum: Q4 SSB revenue +8% to $718M; segment EBITDA $181M with margin >25%, aided by software growth and cost initiatives .
- ATMaaS KPIs accelerated: Q4 revenue $52M (+24% YoY), gross profit $17.4M (+29% YoY), ARR >$212M (+25% YoY), ARPU $8.6k (+5% YoY); management expects ATMaaS revenue >40% growth in 2025 and exit ARR >$300M .
What Went Wrong
- Network revenue -2% YoY to $317M on reported basis (FX, LibertyX drag), and international withdrawal volumes -2% (cycling tough UK ASDA comps), though NA withdrawals +6% and margin was strong .
- Vault cash hedges rolling off in 2025 to pressure Network margin from 36% Q4 level to ~29% for FY25; higher cost of cash is a known headwind .
- Continued FX headwinds (management guides ~2% revenue headwind in 2025), and winding down Voyix-related “Other” revenue (-$100M impact for 2025) will weigh on reported growth .

Financial Results

Performance vs prior quarters (chronological: Q2 → Q3 → Q4)

Metric	Q2 2024	Q3 2024	Q4 2024
Revenue ($B)	$1.081	$1.078	$1.108
Adjusted EBITDA ($M)	$193	$207	$219
Adjusted EBITDA Margin (%)	17.9%	19.2%	19.8%
Non-GAAP Diluted EPS ($)	$0.81	$0.89	$1.11
Recurring Revenue ($M)	$793	$790	$790
Adjusted Free Cash Flow ($M)	$16	$38	$119

Q4 vs prior year and YoY drivers

Q4 YoY	Q4 2024	Q4 2023
Revenue ($B)	$1.108	$1.098
Adj. EBITDA ($M)	$219	$178
Adj. EBITDA Margin (%)	19.8%	16.2%
Non-GAAP Diluted EPS ($)	$1.11	$0.64

Segment breakdown (Q4 2024)

Segment	Revenue ($M)	Adj. EBITDA ($M)	Adj. EBITDA Margin (%)
Self-Service Banking	$718	$181	25.2%
Network	$317	$114	36.0%
T&T	$46	$8	17.4%
Other	$27	$(2)	N/A

Selected KPIs (Q4 2024)

KPI	Q4 2024	YoY
ATMaaS Revenue ($M)	$52	+24%
ATMaaS Gross Profit ($M)	$17.4	+29%
ATMaaS ARR ($M)	>$212	+25%
ATMaaS ARPU ($/unit, LTM)	$8,600	+5% (vs $8,200)
Network EBITDA Margin (%)	36%	+>500 bps YoY implied
Network LTM ARPU	+7% YoY	+7%
Network Managed Units (k)	~78	- (pharmacy rationalization)
Deposit Transactions	+~240% YoY; +90% seq.	+191% FY

Non-GAAP reconciliation and cash flow context:

Q4 operating cash flow $80M; adjusted FCF $119M; FY24 adjusted FCF $242M; FY24 adjusted EBITDA $781M (company notes 2025 methodology would restate FY24 base to $794M) .
Q4 GAAP diluted EPS $0.61; non-GAAP diluted EPS $1.11 after adjustments (stock comp, amortization of intangibles, restructuring, separation, pension MTM, debt extinguishment, Voyix indemnity) .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Core Revenue (ex-Voyix) Growth (cc)	FY 2025	—	+3% to +6% (FX -2%)	New
Total Revenue Growth (cc)	FY 2025	—	+1% to +3% (FX -2%; Voyix down ~$100M)	New
Total Adj. EBITDA Growth (cc)	FY 2025	—	+7% to +10% (FX -1%); 2024 base $794M under new method	New
Non-GAAP Diluted EPS ($)	FY 2025	—	$3.90–$4.10	New
Adjusted Free Cash Flow ($M)	FY 2025	—	$260–$300	New
Below-the-line assumptions	FY 2025	—	Interest ~$275M; ETR ~24%; diluted shares ~76M	New
SSB revenue growth (cc)	FY 2025	—	Mid-single digits; margin mid-20s	New
Network	FY 2025	—	Revenue low-to-mid single digit (cc); margin ~29% on vault cash costs	New
Q1 Revenue (reported)	Q1 2025	—	Down mid-single digits (Voyix step-down)	New
Q1 Adj. EBITDA ($M)	Q1 2025	—	$165–$175	New
Q1 Non-GAAP EPS ($)	Q1 2025	—	$0.50–$0.60	New
Q1 Below-the-line	Q1 2025	—	Interest $65M; ETR low 30s; diluted shares ~75M	New

Note: Company updated Adj. EBITDA definition in 2025 to exclude Other income/expense; FY24 base would be $794M vs $781M under prior method .

Earnings Call Themes & Trends

Topic	Q2 2024 (prior)	Q3 2024 (prior)	Q4 2024 (current)	Trend
ATMaaS strategy/ARPU	Asset-light wins rising; passed on low-return India deals; backlog ARPU >$14k; ARR ~$200M	ATMaaS revenue +23% YoY; ARPU $8.5k LTM; backlog ~8k units; deemphasizing “unit” KPI	ATMaaS revenue $52M (+24%); ARR >$212M; ARPU $8.6k; FY25 ATMaaS rev >40% growth; ARR >$300M exit	Improving momentum; revenue-centric KPIs
Network transactions	Surcharge-free withdrawals +15% YoY; deposit +170%; tap rollout; Chime expansion	Allpoint +14% YoY; deposit +218% YoY; UK/Intl expansion groundwork	NA withdrawals +6% YoY; deposits +~240% YoY; EBITDA margin 36%; managed units ~78k amid pharmacy rationalization	Transaction density up; portfolio optimization
Hardware refresh	Early innings; 2025 a “very good” hardware year; recyclers competitive	Early cycle; backlog building; 2025/26 tailwinds	Improved recycler product; hardware demand in US/W. Europe; refresh over several years	Building into 2025–27
Capital allocation/leverage	Prioritize debt reduction; target ~3x net leverage before buybacks	Reiterated 3x net leverage before return of capital	Expect ~3x by mid-2025; consider buybacks thereafter	Delever then return
Vault cash costs/hedges	—	2025 modest headwind, tailwind later	FY25 Network margin ~29% as hedges roll off; rent ~$3B cash; swaps rolling off	Known FY25 headwind
FX/tariffs	—	—	Limited tariff exposure (Mexico spares; inventory build), FX headwind in 2025	Managed exposure
EBITDA methodology	—	—	2025 excludes Other inc/exp; FY24 base would be $794M	Lower volatility

Management Commentary

“Reflecting on our first full year as an independent company and our best quarter yet… our financial performance has been solid and steady. In nearly every regard, 2024 was an outstanding year for Atleos.” — Tim Oliver, CEO .
“Fourth quarter diluted adjusted earnings per share was up 73% year-over-year to $1.11 and exceeded expectations… we generated an impressive $119 million of free cash flow.” — CFO remarks .
“We expect fully diluted earnings per share will grow 21% to 27% [FY25]… free cash flow $260–$300 million.” — CFO .
“Adjusted EBITDA margin was exceptionally strong at 36% [Network]… margin benefited from a larger-than-expected accrual adjustment in the quarter.” — CFO .
“We think we’ll get [net leverage] under 3x by the midpoint of this year… at that point… debate returning cash to shareholders; our stock is too cheap and… we should be buying some back.” — CEO .

Q&A Highlights

ATMaaS backlog ARPU: mix shift explains movement from $12–13k backlog ARPU to ~>$10k currently; higher-ARPU units implemented in Q4; backlog mix includes India, but average induction ARPU expected to be accretive vs $8.6k LTM .
Geographic/offer dynamics: ATMaaS growth strong in India, Western Europe, US (esp. smaller banks); hardware demand highest in US/EU; improved recycler drives adoption; refresh wave to play out over several years .
Network unit rationalization: Pharmacy closures remove low-volume nodes with negligible revenue impact; expect 3–4k unit adds in 2025 to rebuild count .
Vault cash hedges: ~$3B rented vault cash; hedges from 3–4 years ago rolling off, pressuring COGS; despite this, Network margin ~29% FY25 and near 30% at market rates due to productivity and volume .
Off-balance-sheet financing for ATMaaS: pursuing non-recourse fleet financing; expect a solution by Q2; asset-light mix reduced capital needs vs earlier assumptions .

Estimates Context

Company stated Q4 non-GAAP EPS “exceeded expectations,” but specific Wall Street consensus (S&P Global) could not be retrieved at this time due to access limits. As such, explicit “vs. consensus” comparisons are unavailable .
Implication: Given revenue/EBITDA/EPS acceleration and FY25 guide above FY24 actuals, estimate revisions may skew upward for EPS/FCF and SSB margins, while Network FY25 margin likely recalibrated lower on vault cash costs .

Note: S&P Global consensus data was unavailable at the time of request.

Key Takeaways for Investors

Services-led mix and productivity are expanding margins faster than revenue; FY25 guidance (EPS +21–27%, FCF $260–$300M) suggests continued operating leverage despite FX and Voyix wind-down headwinds .
ATMaaS flywheel strengthening (ARR >$212M; revenue +24% YoY in Q4) with management pivoting to revenue-centric KPIs; 2025 revenue growth >40% and exit ARR >$300M could be a re-rating catalyst as recurring mix rises .
Network remains a high-ROIC utility: transaction density, deposits and tap are driving record ARPU; FY25 margin reset (~29%) from hedge roll-off looks transitory as rate cycle normalizes and scale effects persist .
Early-stage hardware refresh plus improved recycler product provide incremental 2025–27 revenue tailwinds and cross-sell opportunities into managed/ATMaaS services .
Balance sheet improving (net leverage 3.2x YE24) with path to ~3x mid-2025; buyback discussion likely once threshold is achieved—potential near-term stock support .
Near-term watch items: FX (-2% revenue headwind), Q1 step-down from Voyix-related revenue, vault cash cost impact on Network margins, and execution on off-balance-sheet ATMaaS financing .
Leadership transition: new CFO (effective Jan 27, 2025) with public CFO and capital markets pedigree—could accelerate capital structure optimization and investor communications .

Non-GAAP and reconciliations are provided in company materials; management highlighted EBITDA methodology change for 2025 to reduce volatility .

NCR Atleos Corp (NATL)·Q4 2024 Earnings Summary