NCR Voyix Margins Widen as Hardware Shift Masks Revenue Drop
NCR Voyix posted a 21% drop in GAAP revenue to $523 million, a decline the company attributed entirely to its exit from hardware sales rather than any falloff in underlying demand.
NCR Voyix (VYX) reported second-quarter revenue of $523 million, down 21% from a year earlier, after completing its transition away from direct hardware sales to Ennoconn effective April 1. The drop reflects an accounting shift rather than a demand problem: on a pro forma basis that strips out the hardware revenue impact, revenue rose 1% to $523 million from $520 million in the year-ago quarter.
The restaurant technology and retail-checkout provider has spent the past two quarters unwinding hardware revenue recognition in favor of net commission income, a structural change first disclosed in the first quarter. That shift is now showing up directly in margins. Total gross margin expanded to 29.8% of revenue from 22.7% a year earlier, continuing a climb from 25.3% in the first half of 2024 versus 22.3% in the same period of 2023. Adjusted EBITDA margin followed, rising to 18.7% from 14.1%.
The margin gains were not matched by profit growth. Adjusted EBITDA rose just 5% to $98 million from $93 million, a sharp deceleration from the 32% growth NCR Voyix posted in last year's third quarter and the 17% growth in the fourth. The company swung to a $1 million net loss from continuing operations, roughly flat with the prior year's breakeven result but an improvement on the first quarter's $2 million loss; the fourth quarter of 2024 had shown $78 million in net income, aided by a large tax benefit that will not recur.
By segment, Retail revenue fell 20% to $365 million and Restaurants revenue fell 23% to $158 million, both declines tied to the hardware transition rather than softening demand, since profitability in both units improved. Retail segment Adjusted EBITDA margin jumped to 26.6% from 17.8%, while Retail EBITDA itself rose 20% to $97 million even as segment revenue contracted. Restaurants margin improved to 36.7% from 33.2%.
The platform metrics NCR Voyix introduced this year to replace ARR disclosures showed a more mixed picture. Remaining Contract Value for the Voyix Commerce Platform rose 65% year over year to roughly $286 million, but that growth rate is decelerating from the 75% pace reported in the first quarter, and RCV fell sequentially from $293 million, the first such quarterly decline since the company began disclosing the metric. Platform site count told a steadier story, climbing to 85,000 sites, up 10% from a year earlier and an acceleration from 7% growth in the first quarter, though payment site growth slowed to 2% from 3%. Recurring software revenue, a cleaner read on the underlying business, grew 6% to $211 million from $199 million.
NCR Voyix held its full-year revenue guidance at $2.188 billion to $2.303 billion, unchanged from the first-quarter outlook but below the original guide of $2.210 billion to $2.325 billion issued at year-end 2024, a reduction the company tied to the first-quarter divestiture of its Japan bank technology business, which had contributed about $22 million in revenue and $8 million in EBITDA. Full-year Adjusted EBITDA guidance of $432 million to $447 million was likewise held flat from the first-quarter guide but sits slightly below the original $440 million to $455 million range for the same reason.
The company repurchased $11 million of stock during the quarter, up modestly from $9 million in the first quarter but a fraction of the $78 million in combined common and preferred repurchases made in the fourth quarter of 2024. With the hardware transition now complete, the next test for NCR Voyix is whether RCV growth reaccelerates or the sequential decline marks the start of a slower stretch for platform bookings.