NCR Atleos Corp recently released its latest 10-Q report. The company provides self-directed banking and related technology services to financial institutions, merchants, manufacturers, retailers and consumers across the Americas, Europe, the Middle East, Africa and Asia Pacific. Its operations are organized into three segments: Self-Service Banking, Network, and Telecommunications & Technology, with offerings that include ATM hardware and software, ATM-as-a-service, network access, and managed infrastructure services.
In Item 2, Management’s Discussion and Analysis, NCR Atleos said it identified misstatements in previously issued financial statements during preparation of its second and third-quarter 2025 results. The company said the errors were immaterial to previously reported periods, but they led to revisions of first and second-quarter 2025 figures reflected in the current MD&A.
For the quarter ended March 31, total revenue rose 7% to $1.043 billion from $979 million a year earlier. Product revenue increased 17% to $221 million, while service revenue rose 4% to $822 million. Recurring revenue reached $754 million, up from $741 million, and accounted for 72.3% of total revenue, down from 75.7% a year earlier because non-recurring products and services grew faster.
Gross margin was $234 million, up slightly from $232 million, but the gross margin rate fell 130 basis points to 22.4%. The company said higher tariffs, higher component costs and higher vault cash costs in the Network segment pressured margins. Adjusted gross margin also declined, to 24.5% from 25.9%.
Operating income fell 10% to $84 million from $93 million, as selling, general and administrative expenses rose 7% to $130 million and research and development spending increased 18% to $20 million. NCR Atleos said those costs included workforce optimization and strategic initiative spending.
Net income climbed 69% to $22 million from $13 million. Income before taxes rose to $33 million from $22 million, helped by a gain on divestiture of a non-core business, higher income from the company-sponsored defined benefit plan and lower interest costs. Interest expense declined 6% to $63 million from $67 million.
Adjusted EBITDA was unchanged at $172 million, even as revenue increased. The company’s adjusted EBITDA margin was 16.5% of revenue, versus 17.6% in the prior-year quarter.
By segment, Self-Service Banking revenue grew on stronger hardware sales, installation services and ATM-as-a-Service. Annualized recurring revenue in that segment rose to $1.699 billion from $1.602 billion, and ATMaaS revenue increased to $74 million from $57 million. In Network, LTM ARPU was $16.0 thousand, essentially flat with $16.1 thousand a year earlier, while Network Managed Units increased to 77.7 thousand from 77.2 thousand.
The company also said it entered into a merger agreement on February 26, 2026, under which Brink’s would acquire NCR Atleos for $30.00 in cash and 0.1574 shares of Brink’s common stock for each Atleos share. The transaction is expected to close in the first quarter of 2027, subject to shareholder and regulatory approvals. NCR Atleos also said it obtained consents from holders of its 9.500% Senior Secured Notes due 2029, so it will not have to repurchase notes because of the merger. As a result of these announcements, the company's shares have moved -2.57% on the market, and are now trading at a price of $43.63. Check out the company's full 10-Q submission here.
