NCR Voyix’s Q1 2025 Results: Navigating Challenges with Strategic Focus on Recurring Revenue

NCR Voyix Corporation (NCR) reported its first-quarter 2025 financial results, revealing a mixed performance marked by declining top-line revenue but encouraging progress in strategic initiatives. The company highlighted its commitment to transitioning toward a software-driven business model, supported by strong growth in recurring revenue streams and platform expansion. Below is a deep dive into the results, strategic moves, and what they mean for investors.

Financial Highlights: Revenue Declines, But Margins Improve

NCR’s total revenue fell 13% year-over-year to $617 million, driven by a 14% drop in retail revenue and a 5% decline in restaurants revenue. However, the net loss narrowed to $20 million from $71 million in Q1 2024, thanks to cost management and operational efficiencies. The adjusted EBITDA rose to $75 million (up 19% YoY), with margins improving to 12.2% of revenue, compared to 8.9% in the prior year.

The non-GAAP diluted EPS of $0.09 marked a turnaround from a loss of $0.15 in Q1 2024, reflecting adjustments for stock-based compensation and restructuring costs. While hardware revenue pressures persisted, the Annual Recurring Revenue (ARR) grew to $1.62 billion (up 2.5% YoY), with software ARR increasing 4.7% to $775 million. This underscores NCR’s progress in shifting its revenue mix toward higher-margin software and services.

Strategic Moves: Platform Growth and Share Repurchases

NCR emphasized its strategic pivot to platform-led growth, with 77,000 platform sites (up 27% YoY) and 8,000 payment sites (up 7% YoY). These metrics highlight expanding adoption of its SaaS and payments ecosystems, critical to its long-term vision.

The company also bolstered shareholder returns:
- $62 million in Q1 2025 share repurchases (5 million shares)
- An additional $7 million in April 2025 (1 million shares)
- A May 2025 board amendment expanded the repurchase program to $200 million, now including Series A preferred stock.

2025 Outlook: Balancing Risks and Growth

NCR reaffirmed its full-year 2025 outlook:
- Total revenue: $2.575–2.65 billion
- Adjusted EBITDA: $420–445 million (16.3%–16.8% margin)
- Non-GAAP diluted EPS: $0.75–0.80

The outlook assumes gross hardware recognition for the full year, with a planned shift to net commission revenue later in 2025 via its partnership with Ennoconn. Management also factored in U.S. trade tariffs and foreign currency stability, though risks remain if these assumptions falter.

Key Risks and Challenges

1. Hardware Transition: The Ennoconn partnership could disrupt revenue recognition and margins, requiring close monitoring of updates.
2. Economic Volatility: The retail and restaurant segments remain sensitive to consumer spending trends, which could pressure top-line growth.
3. Tariffs and Foreign Exchange: Unforeseen policy changes or currency fluctuations could squeeze profitability.

Conclusion: A Mixed Bag with Strategic Potential

NCR’s Q1 2025 results reflect a company navigating near-term headwinds while investing in long-term growth. The decline in revenue and segment-specific margin pressures are concerning, but the narrowing net loss, rising ARR, and platform expansion suggest strategic alignment.

Investors should focus on two key metrics:
1. ARR Growth: The $1.62 billion ARR (up 2.5% YoY) signals progress in recurring revenue, which could stabilize cash flows.
2. Margin Improvements: The adjusted EBITDA margin expansion to 12.2% highlights cost discipline, a positive sign for profitability.

The $200 million share repurchase program further signals confidence in NCR’s valuation, though execution of the hardware transition and tariff mitigation will be critical.

Final Takeaway: NCR remains a play on the shift to software-driven commerce solutions. While current results are uneven, its focus on recurring revenue and operational efficiency positions it to outperform if macroeconomic conditions improve. Investors should monitor Q2 updates on the Ennoconn transition and ARR growth to assess whether this strategic pivot is paying off.

Data as of March 31, 2025. Past performance does not guarantee future results.