NCR Stock Tumbles as War, Inflation, and Covid Hit Earnings

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NCR said a “multitude of headwinds” hurt its results.

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Oliver Bunic/Bloomberg

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NCR shares fell by double digits after the company posted weaker-than-expected results—the result of a combination of big-picture issues, including the pandemic, the Ukraine war, and inflation—and management reduced its outlook for the full year.

For the first quarter, NCR (ticker: NCR) posted revenue of $1.86 billion, up 21% from a year earlier, but below the range of $1.9 billion to $1.95 billion management had told investors to expect. Non-GAAP profits were 33 cents a share, well below the company’s projection of 60 to 65 cents.

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In late trading, NCR shares were down 16.4%, to $31.24.

NCR, which sells automated teller machines and point-of-sale systems for both retailers and restaurants, said results were hurt by a variety of factors. In a statement, CEO Michael Hayford said “inflation skyrocketed to the highest level in over 40 years, interest rates increased more rapidly, a war broke out in Eastern Europe and the Omicron variant spread. The multitude of headwinds negatively impacted revenue and costs.”

NCR said these issues “collectively caused revenue reduction or delays of more than $90 million and Adjusted EBITDA reduction of more than $70 million,” due to both the lower revenue and dramatically higher costs for components, freight, fuel, and interest.

For the full year, NCR now sees revenue of about $8 billion, down from a previous forecast of $8 billion to $8.2 billion. The company trimmed its full-year forecast for adjusted Ebitda, or earnings before interest, taxes, depreciation and amortization, to a range of $1.4 billion to $1.5 billion, from a previously projected $1.5 billion to $1.575 billion.

NCR now sees full-year free cash flow of $400 million to $500 million, down from a call for $500 million to $600 million. And the company trimmed its full-year profit forecast to a range of $2.70 to $3.20 a share, from a previously projected $3.25 to $3.55 a share.

A previously announced strategic review of its operations, intended to enhance shareholder value, is continuing, the company said.

In late trading, NCR shares have tumbled 16.4%, to $31.24.

Write to Eric J. Savitz at [email protected]


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