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In what could be its final earnings report as a public company, point-of-sale terminal maker and online payment technology provider VeriFone Systems Inc. reported Friday that its revenues for the quarter ended April 30 fell 7.5% from a year earlier, but its quarterly loss narrowed considerably.
San Jose, Calif.-based VeriFone announced in April that it struck a deal to be acquired by an investor group led by Francisco Partners for $3.4 billion in cash. VeriFone stockholders are scheduled to vote on the acquisition June 19. Pending approval, the company expects the deal to close in the third quarter.
In light of the planned buyout, VeriFone said it would not have a conference call with analysts to review the second-quarter financials or produce a slide presentation with further information. The company also withdrew its previous financial guidance for fiscal 2018.
The new results show total revenues slipped to $438.4 million from $473.7 million in fiscal 2017’s second quarter. That decline was expected, according to chief executive Paul Galant.
“We exceeded our revenue guidance for our second fiscal quarter due to continuing execution of our top three strategic priorities: scaling VeriFone’s next-generation devices, connecting more of our 30-plus-million-device footprint to VeriFone’s cloud-based services, and leveraging our leadership position at the point of sale with value-added services that help merchants start, run, and grow their businesses,” Galant said in a news release.
VeriFone’s net quarterly loss narrowed to $17 million from $89.3 million a year earlier.
In North America, VeriFone’s second-largest region, revenues fell 21.9% to $122.9 million from $157.4 million a year earlier. Excluding divested businesses such as taxi systems, North American revenues declined 7.9%.
VeriFone’s POS terminal business boomed in 2015 and 2016 as U.S. merchants replaced old magnetic-stripe readers with devices that could read the new EMV chip cards coming to market. But the EMV conversion wave crested, and gas stations, a major VeriFone market, won a three-year postponement until 2020 from the card networks for converting fuel pumps to the EMV standard, delaying expected revenues for VeriFone.
In the Asia-Pacific region, revenues plunged 35.9% to $48.7 million from $76 million a year earlier. VeriFone has struggled in China and has sold a controlling interest in its operations there to local investors.
The bright spot was Latin America, where revenues jumped 35.2% to $84.5 million from $62.5 million in 2017’s second quarter. In the Europe-Middle East-Africa region, VeriFone’s biggest, revenues came in at $182.3 million, up 2.5% from the prior year quarter’s $177.8 million.
Total revenues from systems—POS terminals and related equipment—fell 9.5% to $258.6 million from $285.7 million a year earlier. Services, which include cloud-based processing systems, generated $179.8 million in revenue, down 4.4% from $188 million in last year’s second quarter.
