Payments and commerce solutions firm Verifone reported results on Thursday that beat Wall Street on the top line, met on the bottom and showed momentum, management said, with next generation solutions and mPOS technology.
In terms of headline numbers, revenues for the period that ended in July topped Wall Street at $467 million, compared to estimates of $464 million, and earnings that came in at $0.36 a share, which met consensus.
The company’s results were impacted by charges and restructuring efforts tied to its businesses based in China and a spinoff of its Petro Media operations. As has been noted before, the company is also engaged in trying to sell its taxi unit.
Marc Rothman, chief financial officer, said on the conference call with the investment community that revenues exceeded guidance and benefitted from what he called “significant strength in both Latin America and EMEA, offset by anticipated declines in Asia-Pacific, specifically India.”
Breaking down business lines a bit, the systems business was $266 million, off 9 percent year on year and in line with company projections, but up sequentially. The culprit behind the decline was the anniversary of EMV introductions in the United States in the prior year.
Management also noted that growth in Argentina and Chile stemmed from market-wide initiatives for faster ePayment adoption across those countries.
CEO Paul Galant noted that verticals that showed some improvement included small and mid-sized businesses. He told analysts that “we remain confident that our next generation products will meet our fiscal 2017 stated volume objectives and our product and client roadmap sets us up for growth in fiscal 2018.”
Galant went on to state that a tailwind of “growth for our core payments and commerce business is the successful launch and the scaling of our Engage, our Carbon and our services platform. The installed base is now at 30 million devices across 150 countries.”
Turning to mPOS, Galant said that within North America, retailers are embracing that technology, and “we are now on track to deliver more than 20 percent organic growth across our mobile product portfolio in fiscal year 2017.”
As for guidance, the firm looks to see earnings of $0.43 a share and a top line of $470 million and $473 million. That is a bit lower than analyst earnings projections of $0.46 a share on $474 million.
In the question-and-answer session with analysts, CEO Paul Galant stated that “our strategy has been consistent. We are not a merchant acquirer. We are a services company … we provide that capability to acquirers, we provide it to banks, we provide it to merchants and that is what we will continue to do.”