By Anne Pallivathuckal
VeriFone Systems Inc. (PAY) reported fiscal second-quarter
results that topped its own expectations and the maker of
merchant-payment terminals said it would reduce headcount by about
500 by the end of this year.
Shares climbed 3.9% to $35.15 after hours.
VeriFone is seeing greater demand for its terminals that have
more secure technology after hackers stole customer data from
retailers such as Target Corp. (TGT) and Neiman Marcus Inc. late
last year. VeriFone has roughly 70% of the market for payment
terminals at large U.S. retailers.
"We are working with our clients to protect their brands and
reputations from the growing threat of data breaches," Chief
Executive Paul Galant said in a statement.
Galant, a former Citigroup executive who was named to the top
post last year, has focused on research and development, realigning
its organizational structure and simplifying its product line-up.
VeriFone said it expects to reinvest a "substantial" portion of
savings from the restructuring to improve its operational
infrastructure and growth initiatives. The company has about 5,000
employees worldwide, according to its website.
VeriFone also projected third-quarter adjusted earnings of 33
cents to 34 cents a share on adjusted revenue of $455 million to
$460 million. Analysts surveyed by Thomson Reuters expect adjusted
earnings of 37 cents a share on revenue of $454 million.
For the quarter ended April 30, the San Jose, Calif., company
reported a loss of $23.9 million, or 22 cents a share, compared
with a loss of $58.4 million, or 54 cents a share, a year earlier.
Excluding items, earnings fell to 37 cents from 42 cents.
Revenue rose 9.4% to $466.4 million. Excluding deferred revenue
and other adjustments, the top line came in at $467 million.
In March, VeriFone forecast adjusted earnings of 30 cents to 32
cents a share on adjusted revenue between $440 million to $445
million.
Write to Anne Pallivathuckal at anne.pallivathuckal@wsj.com
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