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NCR Voyix Corp (VYX)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 revenue was $666M, down 8% year over year, but above consensus; non-GAAP diluted EPS was $0.19, a beat versus estimates, while GAAP diluted EPS was $(0.02). Adjusted EBITDA rose 20% to $95M with margin expanding 340 bps to 14.3% .
  • Versus Wall Street: EPS $0.19 beat vs $0.13*; revenue $666M beat vs $648.6M*; management reaffirmed FY2025 guidance for revenue, adjusted EBITDA, and adjusted free cash flow .
  • Mix improved: Recurring revenue rose 4% YoY; ARR increased to $1.68B and Software ARR to $799M; Restaurants segment grew modestly while Retail declined on hardware softness .
  • Execution highlights: Completed U.S. pilot of Voyix Pay, accelerating SME migration by mid-September; continued hardware ODM transition timing by year-end; tariff headwind estimated at $8–$12M for 2025, with mitigations in place .
  • Capital and cash: Net debt $829M and adjusted net leverage 1.9x; Q2 GAAP operating cash flow was $(242)M, adjusted FCF-unrestricted $13M (before restructuring $37M); capex $42M, predominantly software .

What Went Well and What Went Wrong

What Went Well

  • Adjusted EBITDA up 20% YoY to $95M; margin expanded to 14.3% on cost actions and mix shift .
  • Recurring revenue +4% YoY; ARR reached $1.68B; Software ARR $799M; platform sites +16% YoY to 78K and payment sites +3% to 8K .
  • Management reaffirmed FY2025 guidance and advanced strategic initiatives: “We continued to execute on our key strategic initiatives, including driving product innovation, expanding our payments capabilities, and enhancing our global services offering” — CEO James G. Kelly .
  • Payments: “We completed our pilot for Voyix Pay in the U.S. in July and are on track to complete the migration of our existing SME portfolio… by mid September” — CEO .

What Went Wrong

  • Total revenue declined 8% YoY to $666M, driven primarily by hardware softness; Retail segment revenue fell 12% YoY .
  • GAAP diluted EPS remained negative at $(0.02) (though improved vs $(0.65) in 2Q24); cash from operations negative due to Digital Banking cash tax and working capital timing .
  • Tariff-related costs expected between $8–$12M for FY2025, an external headwind requiring mitigation actions — “no material changes to the tariff related cost… between $8,000,000 and $12,000,000 for the year” — CEO .

Financial Results

Consolidated Results vs Prior Quarters and Prior Year

MetricQ4 2024Q1 2025Q2 2025Q2 2024
Revenue ($USD Millions)$682 $617 $666 $722
GAAP Diluted EPS (Continuing Ops) ($)$(0.08) $(0.17) $(0.02) $(0.65)
Non-GAAP Diluted EPS ($)$0.22 $0.09 $0.19 $(0.20)
Gross Margin %21.8% 21.9% 23.0% 17.5%
Adjusted EBITDA ($USD Millions)$114 $75 $95 $79
Adjusted EBITDA Margin %16.7% 12.2% 14.3% 10.9%

Segment Performance (Revenue and Adj. EBITDA)

SegmentQ2 2024 Revenue ($M)Q2 2025 Revenue ($M)YoY ChangeQ1 2025 Revenue ($M)Q2 2024 Adj. EBITDA ($M)Q2 2025 Adj. EBITDA ($M)Adj. EBITDA Margin Q2 2024Adj. EBITDA Margin Q2 2025
Retail$517 $454 (12)% $420 $87 $81 16.8% 17.8%
Restaurants$201 $205 +2% $191 $62 $68 30.8% 33.2%
Corporate & Other$4 $7 +75% $6 $(70) $(54) ——

KPIs and Mix

KPIQ4 2024Q1 2025Q2 2025
ARR ($USD Billions)$1.64 $1.62 $1.68
Software ARR ($USD Billions)$0.765 $0.775 $0.799
Platform Sites (000s)74 77 78
Payment Sites (000s)7 8 8
Recurring Revenue ($M)$420 $407 $422
Non-Recurring Revenue ($M)$262 $210 $244

Estimates vs Actual (Q2 2025)

MetricConsensusActualSurprise
Primary EPS ($)0.13*0.19 +0.06*
Revenue ($USD Millions)648.6*666 +17.4*

Values marked with * retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious Guidance (Q1 2025)Current Guidance (Q2 2025)Change
Total Revenue ($M)FY 2025$2,575–$2,650 $2,575–$2,650 Maintained
Software & Services Revenue ($M)FY 2025$1,995–$2,020 $1,995–$2,020 Maintained
Hardware Revenue ($M)FY 2025$580–$630 $580–$630 Maintained
Adjusted EBITDA ($M)FY 2025$420–$445 $420–$445 Maintained
Non-GAAP Diluted EPS ($)FY 2025$0.75–$0.80; tax 26%, 158M diluted shares assumption $0.75–$0.80; tax 22%, 157M diluted shares assumption Maintained range; assumptions lowered (tax, shares)
Adjusted Free Cash Flow - Unrestricted ($M)FY 2025$170–$190 $170–$190 Maintained
Hardware Recognition BasisFY 2025Gross recognition; to update post-ODM transition Gross recognition; update later for net commission Maintained stance
Tariffs AssumptionFY 2025Included estimated impacts Included estimated impacts Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024 and Q1 2025)Current Period (Q2 2025)Trend
AI/Technology initiatives & VCP rolloutEmphasis on platform-led SaaS; pro forma cost actions to support platform growth “Launching additional VCP capabilities beginning in Q4… enterprise grocery/convenience POS, SCO and fuel at NRF in January” Accelerating product cadence
Payments platform (Voyix Pay)Capital allocation includes platform investments; share repurchases “Completed U.S. pilot in July; SME migration by mid-September; enabling acquiring in UK, Canada, LatAm” Commercialization and geographic expansion
Hardware ODM transitionTransition outlined; outlook to reflect net commission post-implementation “Progressing on ODM agreement, commence by year end; pilots underway in Europe; testing in Nashville” Execution progressing
Tariffs/macroPending tariff impacts excluded in Q4 outlook; Q1 includes estimated impacts “Tariff cost estimate unchanged at $8–$12M for 2025” Stable but monitored
Recurring revenue and ARR+5% ARR in Q4; +2% ARR in Q1; strong platform site growth Recurring +4% YoY; ARR $1.68B; Software ARR $799M; platform sites +16% YoY Improving mix resilience
R&D/product executionOngoing expense reduction and platform investments New restaurant suite (labor, inventory, reporting, scheduling) in Q4; centralized menu mgmt in early 2026 New releases imminent

Management Commentary

  • “In the second quarter, we continued to execute on our key strategic initiatives, including driving product innovation, expanding our payments capabilities, and enhancing our global services offering. I am encouraged by our recent progress…” — James G. Kelly, CEO .
  • “We completed our pilot for Voyix Pay in the U.S. in July and are on track to complete the migration of our existing SME portfolio… by mid September… enabling acquiring in the UK, Canada and Latin America…” — CEO .
  • Hardware transition: “We continue to progress on the implementation of our ODM agreement, which will commence by year end… pilot for our European markets is already underway… expect the pilot for The Americas and Asia Pacific to begin next month” — CEO .
  • Tariffs: “No material changes to the tariff related cost… estimated… between $8,000,000 and $12,000,000 for the year” — CEO .
  • Capital and leverage snapshot (Q2 deck): Net debt $829M; adjusted net leverage 1.9x; capex $42M in Q2; adjusted free cash flow-unrestricted $13M ($37M before restructuring) .

Q&A Highlights

  • Payments monetization and cross-sell: Management emphasized contracting strategy to bundle payments with software in new deals to reduce vendor complexity and drive revenue opportunities .
  • Hardware ODM timeline and impact: Execution milestones (EU pilot live; Nashville testing; AMER/APAC pilots imminent) support gross-to-net hardware recognition shift post-implementation .
  • Cash flow ramp: Team reiterated FY adjusted FCF guidance; near-term GAAP operating cash flow headwinds include $284M cash taxes related to Digital Banking sale and restructuring, with improvement expected in 2H25 .
  • Tariffs: No change to $8–$12M FY headwind estimate; mitigation strategies under reassessment as conditions evolve .
  • Leverage and capex: Net leverage at 1.9x; capex $42M in Q2 and $81M YTD, >80% software investments; supports platform roadmap .

Estimates Context

  • Q2 2025 results beat consensus on EPS and revenue: EPS $0.19 vs $0.13*; revenue $666M vs $648.6M*; both with ~7–3% upside respectively. Estimate coverage was 7 analysts for both metrics* .
  • Implications: EPS beats reflect margin expansion from cost actions and mix; revenue beat driven by resiliency in Software & Services and Restaurants strength offsetting hardware softness .
  • Adjustments: Non-GAAP EPS benefited from excluding transformation/restructuring, stock-based comp, and acquisition-related amortization (see reconciliation) .

Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

  • Mix shift and cost discipline are working: despite lower hardware revenue, recurring and Software & Services mix plus cost actions expanded margins and delivered an EPS beat .
  • FY2025 guide intact with improved assumptions (lower tax rate and diluted shares), supporting credibility ahead of hardware ODM net revenue transition; watch for guide update when net recognition begins .
  • Payments is a near-term growth catalyst: Voyix Pay U.S. pilot complete; SME migration imminent; international acquiring enablement underway — expect expanding payments take-rate contribution over time .
  • Cash flow inflection in 2H25 is key: adjusted FCF guidance maintained; near-term GAAP CFO headwinds (Digital Banking tax) are transitory — monitor restructuring cadence and working capital .
  • Segment divergence: Restaurants strong (Adj. EBITDA margin 33.2%); Retail pressured by hardware; strategic focus on platform bundling and payments should support Retail profitability .
  • Tariffs a manageable headwind ($8–$12M); continued mitigation and ODM transition should reduce volatility; track any policy changes .
  • Capital allocation balanced: leverage at 1.9x, ongoing share repurchases ($7M in Q2) — optionality for buybacks vs growth investments remains .