By Jeffrey Green (@epaymentsguy)
Earlier this week, new VeriFone Systems Inc. CEO Paul Galant held his first quarterly earnings call with industry analysts. He assumed the leadership role in September from interim CEO Richard McGinn, who took over in March when long-time company head Doug Bergeron left the payment-terminal maker.
Galant has his work cut out for him. In the company’s December 17 earnings release, he cited that the convergence of electronic payments, mobility, digital commerce and predictive analytics made this an “exciting time to lead VeriFone.” Later, during his call with analysts, he made note of VeriFone’s reach, which totals approximately 14 million merchants that use the company’s terminals, software and services.
How can a company with so many disparate customers globally, all of whom have their own quickly changing needs related to payment acceptance, possibly meet their needs, especially with tablets fast emerging as viable alternatives to VeriFone’s traditional bread-and-butter hardware?
Yes, as Galant noted in the release, “There is much work to do.”
As such, Galant’s success will hinge on the quality of people around him, and their ability to adjust to the quickly changing market driven by immediacy inherent with consumers now carrying computers in their pockets. Many merchants, after all, are consumers themselves, and they now expect their payment-acceptance solutions to work as efficiently as their smartphones and tablets. Galant’s test is whether he can make that so.
Staying committed to the hardware side of payments, as Galant told an analyst during the call that VeriFone would do, may be a sign of backward thinking. Or perhaps VeriFone has in mind a concentrated focus on its own tablet-based solutions. Only time will tell.
During the fiscal fourth quarter ended October 31, VeriFone reported net revenues of $431 million, down 11 percent from $485 million during the same period last year, but ahead of the company’s guidance. The company’s net loss also jumped, to $2.26 million from $240,000.
Among the quarter’s key highlights included paying down $83 million in debt, partnering with American Express to enable passengers to use their Membership Rewards points to pay New York taxi fares, leveraging its MX 900 and VX series products to score seven multilane retail wins, and completing rollouts of the company’s next-generation PayWare Mobile products to two top-100 retailers.
For more insights from PYMNTS.com Senior Analyst Jeff Green, click here.
To download Green’s latest report on P2P payments and how they can be turned into revenue generators, visit our Report Store here.