2/14/20240001974138false00019741382024-02-142024-02-14

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 14, 2024
NCR ATLEOS CORPORATION
(Exact name of registrant as specified in its charter)
Commission File Number 001-41728
Maryland92-3588560
(State or other jurisdiction of
incorporation or organization)		(I.R.S. Employer
Identification No.)
864 Spring Street NW
Atlanta, GA 30308
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (937) 445-1936

(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s)Name of each exchange on which registered
Common Stock, par value $0.01 per shareNATLNew York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).        Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o


Item 2.02.    Results of Operations and Financial Condition.
On February 14, 2024, NCR Atleos Corporation (the “Company”) issued a press release setting forth its fourth quarter 2023 financial results and certain other financial information. A copy of the press release is attached hereto as Exhibit 99.1 and hereby incorporated by reference.
Item 7.01.    Regulation FD Disclosure.
On February 14, 2024, the Company will hold its previously announced conference call to discuss its fourth quarter 2023 financial results. A copy of supplementary materials that will be referred to in the conference call, and which were posted to the Company's website, is attached hereto as Exhibit 99.2.
The information in this report (including Exhibits 99.1 and 99.2) is being furnished pursuant to Item 2.02 and Item 7.01 and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act.

Item 9.01.    Financial Statements and Exhibits.
(d)Exhibits:
The following exhibits are attached with this current report on Form 8-K:
Exhibit No.Description
99.1
99.2
104Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
NCR Atleos Corporation
By:/s/ Paul J. Campbell
Paul J. Campbell
Executive Vice President and Chief Financial Officer
Date: February 14, 2024



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NEWS RELEASE
NCR Atleos Announces Fourth Quarter 2023 Results

ATLANTA, February 14, 2024 - NCR Atleos Corporation (NYSE: NATL) (“Atleos”) reported financial results today for the three months ended December 31, 2023. Fourth quarter results and other recent highlights include:

•Completed separation transaction from NCR Corporation on October 16th
•More than 20,000 ATM-as-a-Service active units at year-end
•Solid fourth quarter results, including:
–Revenue of $1.1 billion, up 3% year-over-year; recurring revenue of $777 million, up 10% year-over-year
–Net loss attributable to Atleos of $161 million on a GAAP basis; GAAP basis diluted loss per share attributable to Atleos of $2.28 and Non-GAAP diluted earnings per share of $0.69
•Q4 2023 Adjusted EBITDA was $178 million, up 7% year-over-year after normalizing Q4 2022 for an estimated impact of $20 million from delayed legal entity transfers and separation dis-synergies
•Full year 2024 financial targets consistent with separation projections: Revenue of $4.2 - $4.4 billion; Adjusted EBITDA of $770 - $800 million

“The fourth quarter was a strong start for Atleos as a separate company, and a great finish to the year. Our core businesses performed exceptionally well, with financial results in line with the projections made for the separation transaction. Execution was outstanding, as we simultaneously completed the split from legacy NCR Corporation and achieved our operating objectives,” said Tim Oliver, President and Chief Executive Officer. “Our market leading self-service banking solutions continue to gain appeal with banks, consumers, and other commercial partners, leading to solid top line fundamentals for the fourth quarter that included 10% growth in recurring revenue, which accounted for 71% of total revenue, up from 67% in the prior year period. The shift to recurring revenue and resulting positive underlying profit trends reinforce our confidence that our strategy has the Company on the right path.”

Mr. Oliver continued, “Given the momentum of our businesses, progress on key initiatives, and continued favorable market dynamics for our solutions, we provided 2024 financial targets today that are consistent with the preliminary views from our December 5th investor update call. Looking beyond 2024, we are energized by the opportunity to lead a transformation in self-service banking solutions and the potential to create significant value for shareholders.”
Fourth Quarter 2023 Operating Results
•Fourth quarter revenue was $1.098 billion, including $777 million of recurring revenue, compared to $1.065 billion and $709 million, respectively, in the prior year period.
•Fourth quarter gross profit was $198 million with a gross profit rate of 18.0% on a GAAP basis, compared to $242 million and 22.7% in the prior year period. Fourth quarter adjusted gross profit (non-GAAP) was $272 million with an adjusted gross profit rate of 24.8%, compared to $267 million and 25.1% in the prior year period.
•Fourth quarter income from operations was $35 million on a GAAP basis, compared to $90 million in the prior year period. Fourth quarter adjusted income from operations (non-GAAP) was $150 million compared to $144 million in the prior year period.
•Fourth quarter net loss attributable to Atleos was $161 million on a GAAP basis, compared to net income attributable to Atleos of $7 million in the prior year period.
•Fourth quarter Adjusted EBITDA was $178 million, and included several items that impacted the comparability to prior year period results of $187 million. Excluding those items, the Company estimates that Adjusted EBITDA would have increased 7% year-over-year in the fourth quarter of 2023.


NCR ATLEOS CORPORATION
REVENUE AND ADJUSTED EBITDA SUMMARY
(Unaudited)
(in millions)
For the Periods Ended December 31
Three Months
20232022% Change
Revenue by segment
Self-Service Banking$665 $683 (3)%
Network323 298 8%
T&T48 53 (9)%
Total segment revenue1,036 1,034 —%
Other (1)
62 31 100%
Consolidated revenue$1,098 $1,065 3%
Adjusted EBITDA by segment
Self-Service Banking$146 $159 (8)%
Self-Service Banking Adjusted EBITDA margin %22.0%23.3%
Network100 81 23%
Network Adjusted EBITDA margin %31.0%27.2%
T&T7 12 (42)%
T&T Adjusted EBITDA margin %14.6%22.6%
Other (1)
810(20)%
Corporate (2)
(83)(75)11%
Total Adjusted EBITDA $178$187(5)%
Total Adjusted EBITDA margin %16.2%17.6%
(1)Other represents certain other immaterial business operations, including commerce-related operations in countries that Voyix exited that are aligned to Atleos, that do not represent a reportable segment. For periods after the separation from Voyix, Other also includes revenues from commercial agreements with Voyix.
(2)Corporate includes income and expenses related to corporate functions and, for periods prior to the separation from Voyix, certain allocations from Voyix that are not specifically attributable to an individual reportable segment.

Notes to Investors

On October 16, 2023, NCR Atleos Corporation (“Atleos”, the “Company”, “we” or “us”) became a standalone publicly traded company, and its financial statements are now presented on a consolidated basis. Prior to the separation from NCR Voyix Corporation (“NCR” or “Voyix”), the Company’s historical combined financial statements were prepared on a standalone carve-out basis and were derived from Voyix’s consolidated financial statements and accounting records. Therefore, financial results for the three and twelve month periods ended December 31, 2023 and 2022 may not be meaningfully comparable. Accordingly, we have not included full-year numbers regarding our non-GAAP measures.

In this release, we use certain non-GAAP measures. These non-GAAP measures include “Adjusted EBITDA,” and others with the words “non-GAAP” in their titles. These non-GAAP measures are listed, described and reconciled to their most directly comparable GAAP measures under the heading “Non-GAAP Financial Measures” later in this release.
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With respect to our Adjusted EBITDA, adjusted free cash flow-unrestricted and non-GAAP diluted earnings per share guidance, we do not provide a reconciliation of the respective GAAP measures because we are not able to predict with reasonable certainty the reconciling items that may affect the GAAP net income, GAAP cash flow from operating activities and GAAP diluted earnings per share without unreasonable effort. The reconciling items are primarily the future impact of special tax items, capital structure transactions, restructuring, pension mark-to-market transactions, acquisitions or divestitures, or other events. These reconciling items are uncertain, depend on various factors and could significantly impact, either individually or in the aggregate, the GAAP measures. Refer to the heading “Non-GAAP Financial Measures” for additional information regarding our use of non-GAAP financial measures.
First Quarter and Full Year 2024 Guidance
GuidanceQ1 2024
FY 2024
Revenue
$1.0 - $1.05 billion
$4.2 - $4.4 billion
Adjusted EBITDA
$150 - $160 million
$770 - $800 million
Non-GAAP Diluted EPS
$0.30 - $0.40
$2.90 - $3.20
Adjusted free cash flow-unrestricted (1)
positive
$170 - $230 million
(1) Beginning in 2024, our calculation of adjusted free cash flow-unrestricted will include an adjustment for financing payments/receipts of owned ATM capital expenditures.
2023 Fourth Quarter Earnings Conference Call
A conference call is scheduled for today at 8:30 a.m. Eastern Time to discuss the fourth quarter 2023 results. Access to the conference call and accompanying slides, as well as a replay of the call, are available on Atleos’ web site at http://investor.ncratleos.com. Additionally, the live call can be accessed by dialing 800-753-0725 (United States/Canada Toll-free) or 786-460-7170 (International Toll) and entering the participant passcode 2395783. References to Atleos’ website and/or other social media sites or platforms in this release do not incorporate by reference the information on such websites, social media sites, or platforms, and Atleos disclaims any such incorporation by reference.
More information on Atleos’ fourth quarter earnings, including additional financial information and analysis, is available on Atleos’ Investor Relations website at https://investor.ncratleos.com/.
News Media Contact
Scott Sykes
NCR Atleos Corporation
scott.sykes@ncratleos.com
Investor Contact
Brendan Metrano
NCR Atleos Corporation
brendan.metrano@ncratleos.com

About Atleos

Atleos (NYSE: NATL) is a leader in expanding financial access by shifting transactions to the self-service channel and enabling financial institutions and retailers to leverage its ATM network – the largest independently-owned network in the world. Through its digital-first technology and unmatched global services operation, Atleos optimizes the branch, improves operational efficiency and maximizes self-service availability. Atleos is headquartered in Atlanta, Georgia, with 20,000 employees globally.

Web site: https://www.ncratleos.com
X (Twitter): https://twitter.com/ncratleos
Facebook: https://www.facebook.com/Atleos.NCR/
LinkedIn: https://www.linkedin.com/company/ncratleos
YouTube: https://www.youtube.com/@ncratleos
Instagram: https://www.instagram.com/ncratleos/
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Cautionary Statements
This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 (the “Act”). Forward-looking statements use words such as “expect,” “anticipate,” “outlook,” “intend,” “plan,” “confident,” “believe,” “will,” “should,” “would,” “potential,” “positioning,” “proposed,” “planned,” “objective,” “likely,” “could,” “may,” and words of similar meaning, as well as other words or expressions referencing future events, conditions or circumstances. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Act. Statements that describe or relate to Atleos’ plans, goals, intentions, strategies, or financial outlook, and statements that do not relate to historical or current fact, are examples of forward-looking statements. Examples of forward-looking statements in this release include, without limitation, statements regarding: our expectations of demand for our solutions and execution and the impact thereof on our financial results and our intention to focus our resources on meeting our ATM customers' needs and extending our leadership position in digital-to-physical transactions following the spin-off. Forward-looking statements are based on our current beliefs, expectations and assumptions, which may not prove to be accurate, and involve a number of known and unknown risks and uncertainties, many of which are out of Atleos’ control. Forward-looking statements are not guarantees of future performance, and there are a number of important factors that could cause actual outcomes and results to differ materially from the results contemplated by such forward-looking statements, including those factors relating to:
•Strategy and Technology: transforming our business model; development and introduction of new solutions; competition in the technology industry; integration of acquisitions and our multinational operations;
•Business Operations: domestic and global economic and credit conditions; risks and uncertainties from the payments-related business and industry; disruptions in our data center hosting and public cloud facilities; retention and attraction of key employees; defects, errors, installation difficulties or development delays; failure of third-party suppliers; a major natural disaster or catastrophic event, including the impact of the pandemic and geopolitical and macroeconomic challenges; environmental exposures from historical and ongoing manufacturing activities; and climate change;
•Data Privacy & Security: impact of data protection, cybersecurity and data privacy including any related issues;
•Finance and Accounting: our level of indebtedness; the terms governing our indebtedness; incurrence of additional debt or similar liabilities or obligations; access or renewal of financing sources; our cash flow sufficiency to service our indebtedness; interest rate risks; the terms governing our trade receivables facility; the impact of certain changes in control relating to acceleration of our indebtedness, our obligations under other financing arrangements or required repurchase of our senior secured notes; any lowering or withdrawal of the ratings assigned to our debt securities by rating agencies; our pension liabilities; and write down of the value of certain significant assets;
•Law and Compliance: protection of our intellectual property; changes to our tax rates and additional income tax liabilities; uncertainties regarding regulations, lawsuits and other related matters; changes to cryptocurrency regulations;
•Separation: the potential strategic benefits, synergies or opportunities expected from the separation may not be realized or may take longer to realize than expected; the potential inability to access, or reduced access, to the capital markets or increased cost of borrowings, including as a result of a credit rating downgrade; the incurrence of significant costs in connection with the separation; the potential adverse reactions to the separation by customers, suppliers, strategic partners or key personnel and potential difficulties in maintaining relationships with such persons and risks associated with third party contracts containing consent, and/or other provisions that may be triggered by the separation; unforeseen tax liabilities or changes in tax law; non-compete restrictions in the separation agreement entered into in connection with the separation; requests, requirements or penalties imposed by any governmental authorities related to certain existing liabilities; that Atleos may incur material costs and expenses as a result of the spin-off; that Atleos has no history operating as an independent, publicly traded company, and Atleos’ historical and pro forma financial information is not necessarily representative of the results that it would have achieved as a separate, publicly traded company and therefore may not be a reliable indicator of its future results; Atleos’ obligation to indemnify Voyix pursuant to the agreements entered into in connection with the spin-off (including with respect to material taxes) and the risk Voyix may not fulfill any obligations to indemnify Atleos under such agreements; that under applicable tax law, Atleos may be liable for certain tax liabilities of Voyix following the spin-off if Voyix were to fail to pay such taxes; that agreements binding on Atleos restrict it from taking certain actions after the distribution that could adversely impact the intended U.S. federal income tax treatment of the distribution and related transactions; potential liabilities arising out of state and federal fraudulent conveyance laws; the fact that Atleos may receive worse commercial terms from third-parties for services it presently receives from Voyix; that certain of Atleos’ executive officers and directors may have actual or potential conflicts of interest because of their previous positions at Voyix; potential difficulties in
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maintaining relationships with key personnel; that Atleos will not be able to rely on the earnings, assets or cash flow of Voyix and Voyix will not provide funds to finance Atleos’ working capital or other cash requirements.

Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those set forth in the forward-looking statements. Additional information concerning these and other factors can be found in the Company’s filings with the U.S. Securities and Exchange Commission, including the Company’s Form 10, quarterly reports on Form 10-Q, and current reports on Form 8-K. Any forward-looking statement speaks only as of the date on which it is made. The Company does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Non-GAAP Financial Measures
Non-GAAP Financial Measures. While Atleos reports its results in accordance with Generally Accepted Accounting Principles in the United States, or GAAP, in this release Atleos also uses the non-GAAP measures listed and described below.
Adjusted Gross Profit (Non-GAAP), Adjusted Gross Profit Rate (Non-GAAP), Adjusted Income from Operations (non-GAAP), Non-GAAP Diluted Earnings per Share. Atleos’ Adjusted Gross Profit (non-GAAP), Adjusted Gross Profit Rate (non-GAAP), Adjusted Income from Operations (non-GAAP), and Non-GAAP Diluted Earnings per Share are determined by excluding, as applicable, acquisition-related costs; pension mark-to-market adjustments, pension settlements, pension curtailments and pension special termination benefits; separation-related costs; amortization of acquisition-related intangibles; stock-based compensation expense; transformation and restructuring charges (which includes integration, severance and other exit and disposal costs); and other special (expense) income items from Atleos’ GAAP gross profit, expenses, income from operations, interest and other income (expense), income tax expense, effective income tax rate, net income attributable to Atleos, and earnings per share, respectively. Due to the non-recurring or non-operational nature of these pension and other special items, Atleos’ management uses these non-GAAP measures to evaluate year-over-year operating performance. Atleos believes these measures are useful for investors because they provide a more complete understanding of Atleos’ underlying operational performance, as well as consistency and comparability with Atleos’ past reports of financial results.
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA). Atleos’ management uses the non-GAAP measure Adjusted EBITDA because it provides useful information to investors as an indicator of performance of the Company’s ongoing business operations. Atleos determines Adjusted EBITDA based on GAAP Net income attributable to Atleos plus interest expense, net; plus income tax expense (benefit); plus depreciation and amortization; plus acquisition-related costs; plus pension mark-to-market adjustments, pension settlements, pension curtailments and pension special termination benefits; plus separation-related costs; plus transformation and restructuring charges (which includes integration, severance and other exit and disposal costs); plus stock-based compensation expense; plus other special (expense) income items. These adjustments are considered non-operational or non-recurring in nature and are excluded from the Adjusted EBITDA metric utilized by our chief operating decision maker (“CODM”) in evaluating segment performance and are separately delineated to reconcile back to total reported income attributable to Atleos. This format is useful to investors because it allows analysis and comparability of operating trends. It also includes the same information that is used by Atleos management to make decisions regarding our segments and to assess our financial performance. Refer to the table below for the reconciliations of Net income attributable to Atleos (GAAP) to Adjusted EBITDA (non-GAAP).
Adjusted EBITDA margin is calculated based on Adjusted EBITDA as a percentage of total revenue. Adjusted EBITDA margin by segment is calculated based on segment Adjusted EBITDA divided by the related component of revenue. This measure is used by Atleos’ management for the reasons referenced above.
Special Item Related to Russia The war in Eastern Europe and related sanctions imposed on Russia and related actors by the United States and other jurisdictions required us to commence the orderly wind down of our operations in Russia in the first quarter of 2022. As of December 31, 2023, we have ceased operations in Russia and are in the process of dissolving our only subsidiary in Russia. As a result, for the three months ended December 31, 2022, our presentation of segment revenue and Adjusted EBITDA exclude the immaterial impact of our operating results in Russia, as well as the impact of impairments taken to write down the carrying value of assets and liabilities, severance charges, and the assessment of collectability on revenue recognition. We consider this to be a non-recurring special item and management has reviewed the results of its business segments excluding these impacts.
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Adjusted free cash flow-unrestricted. Atleos defines Adjusted free cash flow-unrestricted as net cash provided by operating activities less capital expenditures for property, plant and equipment, less additions to capitalized software, plus/minus the change in restricted cash settlement activity, plus/minus net reductions or reinvestment in the trade receivables facility established in the fourth quarter of 2023 due to fluctuations in the outstanding balance of receivables sold, and plus pension contributions and settlements. Restricted cash settlement activity represents the net change in amounts collected on behalf of, but not yet remitted to, certain of the Company’s merchant customers or third-party service providers that are pledged for a particular use or restricted to support these obligations. These amounts can fluctuate significantly period to period based on the number of days for which settlement to the merchant has not yet occurred or day of the week on which a reporting period ends. We believe Adjusted free cash flow-unrestricted information is useful for investors because it indicates the amount of cash available after these adjustments for, among other things, investments in Atleos’ existing businesses, strategic acquisitions, and repayment of debt obligations. Adjusted free cash flow-unrestricted does not represent the residual cash flow available, since there may be other non-discretionary expenditures that are not deducted from the measure. Adjusted free cash flow-unrestricted does not have a uniform definition under GAAP, and therefore Atleos’ definition may differ from other companies’ definitions of this measure. This non-GAAP measure should not be considered a substitute for, or superior to, cash flows from operating activities under GAAP.
Atleos’ definitions and calculations of these non-GAAP measures may differ from similarly-titled measures reported by other companies and cannot, therefore, be compared with similarly-titled measures of other companies. These non-GAAP measures should not be considered as substitutes for, or superior to, results determined in accordance with GAAP.
Use of Certain Terms
Recurring revenue All revenue streams from contracts where there is a predictable revenue pattern that will occur at regular intervals with a relatively high degree of certainty. This includes hardware and software maintenance revenue, processing revenue, interchange and network revenue, Bitcoin-related revenue, and certain professional services arrangements, as well as term-based software license arrangements that include customer termination rights.
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NCR ATLEOS CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
For the Periods Ended December 31
Three MonthsTwelve Months
($ in millions, except per share amounts)2023202220232022
Revenue
Product revenue$282 $304 $1,030 $1,098 
Service revenue816 761 3,161 3,033 
Total revenue1,098 1,065 4,191 4,131 
Cost of products227 253 846 972 
Cost of services673 570 2,412 2,240 
Total gross profit198 242 933 919 
% of Revenue18.0 %22.7 %22.3 %22.2 %
Selling, general and administrative expenses140 140 585 586 
Research and development expenses23 12 77 64 
Income from operations35 90 271 269 
% of Revenue3.2 %8.5 %6.5 %6.5 %
Interest expense(69)— (71)— 
Related party interest expense, net— (8)(13)(31)
Other income (expense), net(80)(81)(74)(81)
Total interest and other expense, net(149)(89)(158)(112)
Income before income taxes(114)1 113 157 
% of Revenue(10.4)%0.1 %2.7 %3.8 %
Income tax expense (benefit)46 (4)241 50 
Net income (loss)(160)5 (128)107 
Net income (loss) attributable to noncontrolling interests1 (2)2 (1)
Net income (loss) attributable to Atleos$(161)$7 $(130)$108 
Net income (loss) per share attributable to Atleos common stockholders - basic and diluted$(2.28)$0.10 $(1.84)$1.53 
Number of basic and diluted shares outstanding (1)
70.6 70.6 70.6 70.6 
(1)On October 16, 2023, the date of separation from Voyix (the "Separation"), 70.6 million shares of Atleos' Common Stock, par value $0.01 per share, were distributed to Voyix shareholders of record as of October 2, 2023, the Record Date. This share amount is utilized for the calculation of basic and diluted earnings per share for all periods presented prior to the Separation. For the three and twelve months ended December 31, 2022, these shares are treated as issued and outstanding for purposes of calculating historical earnings per share. For periods prior to the Separation, it is assumed that there are no dilutive equity instruments as there were no equity awards of Atleos outstanding prior to the Separation.
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CONSOLIDATED BALANCE SHEETS
(Unaudited)
($ in millions, except per share amounts)December 31,
2023		December 31, 2022
Assets
Current assets
Cash and cash equivalents$375 $293 
Accounts receivable, net of allowances of $14 and $16 as of December 31, 2023 and December 31, 2022, respectively
704 455 
Related party receivable, current— 47 
Inventories333 419 
Restricted cash180 204 
Prepaid and other current assets276 231 
Total current assets1,868 1,649 
Property, plant and equipment, net471 412 
Goodwill1,952 1,949 
Intangibles, net635 729 
Operating lease assets97 85 
Prepaid pension cost218 172 
Deferred income taxes254 317 
Related party receivable, non-current— 336 
Other assets165 123 
Total assets$5,660 $5,772 
Liabilities and stockholders’ equity
Current liabilities
Short-term borrowings$76 $— 
Short-term borrowings from related party— 108 
Accounts payable382 350 
Related party payable, current — 13 
Payroll and benefits liabilities195 69 
Contract liabilities328 356 
Settlement liabilities160 212 
Other current liabilities364 261 
Total current liabilities1,505 1,369 
Long-term debt2,938 — 
Long-term debt from related party— 717 
Pension and indemnity plan liabilities385 22 
Postretirement and postemployment benefits liabilities46 — 
Income tax accruals36 39 
Operating lease liabilities69 59 
Deferred income tax liabilities34 201 
Other liabilities141 103 
Total liabilities5,154 2,510 
Stockholders' equity
Atleos stockholders' equity:
Preferred stock: par value $0.01 per share, 50.0 shares authorized, no shares issued
— — 
Common stock: par value $0.01 per share, 350.0 shares authorized, 70.9 shares issued and outstanding as of December 31, 2023
1 — 
Paid-in capital16 — 
Retained earnings404 — 
Net investment from NCR Corporation— 3,326 
Accumulated other comprehensive income (loss)82 (63)
Total Atleos stockholders' equity503 3,263 
Noncontrolling interests in subsidiaries3 (1)
Total stockholders' equity506 3,262 
Total liabilities and stockholders' equity$5,660 $5,772 
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CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
For the Periods Ended December 31
Three MonthsTwelve Months
($ in millions)2023202220232022
Operating activities
Net income (loss)$(160)$5 $(128)$107 
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation expense36 35 126 127 
Amortization expense36 33 129 132 
Stock-based compensation expense23 15 68 66 
Deferred income taxes(17)(6)76 (28)
Loss on disposal of property, plant and equipment3 — 3 — 
Changes in assets and liabilities:
Receivables54 18 93 (78)
Related party receivables and payables— 4 (22)(26)
Inventories97 49 62 (10)
Settlement Assets1 (8)(7)(10)
Current payables and accrued expenses42 (91)67 (78)
Contract liabilities(6)25 (6)44 
Employee benefit plans(157)73 (170)62 
Other assets and liabilities5 (119)13 (34)
Net cash (used in) provided by operating activities$(43)$33 $304 $274 
Investing activities
Expenditures for property, plant and equipment$(38)$(18)$(108)$(58)
Additions to capitalized software(9)(9)(24)(39)
Business acquisitions, net of cash acquired— — (1)(78)
Amounts advanced for related party notes receivable— (17)(217)(274)
Repayments received from related party notes receivable— 2 44 32 
Purchase of investments— — (10)— 
Net cash used in investing activities$(47)$(42)$(316)$(417)
Financing activities
Proceeds from related party borrowings— (203)159 68 
Payments on related party borrowings— 62 (314)(604)
Proceeds from issuance of senior secured notes— — 1,333 — 
Proceeds from borrowings on term credit facilities835 — 1,561 — 
Borrowings on revolving credit facilities330 — 330 — 
Payments on revolving credit facilities(175)— (175)— 
Debt issuance costs(51)— (51)— 
Principal payments for finance lease obligations(1)(1)(2)(2)
Net transfers (to) from NCR Corporation(4)98 222 721 
Tax withholding payments on behalf of employees(7)— (7)— 
Distribution of net assets contributed(2,996)— (2,996)— 
Net cash provided by (used in) financing activities$(2,069)$(44)$60 $183 
Effect of exchange rate changes on cash, cash equivalents and restricted cash(7)50 17 (11)
Increase (decrease) in cash, cash equivalents, and restricted cash$(2,166)$(3)$65 $29 
Cash, cash equivalents and restricted cash at beginning of period2,730 502 499 470 
Cash, cash equivalents, and restricted cash at end of period$564 $499 $564 $499 

9

The following table presents the recurring revenue and all other products and services that is recognized at a point in time:
In millionsThree months ended December 31
20232022
Recurring revenue (1)
$777 $709 
All other products and services321 356 
Total revenue$1,098 $1,065 
Recurring revenue as a percent of revenue71 %67 %
(1)Recurring revenue includes all revenue streams from contracts where there is a predictable revenue pattern that will occur at regular intervals with a relatively high degree of certainty. This includes hardware and software maintenance revenue, processing revenue, interchange and network revenue, Bitcoin-related revenue, and certain professional services arrangements, as well as term-based software license arrangements that include customer termination rights.

Reconciliation of Net Income Attributable to Atleos (GAAP) to Adjusted Net Income Attributable to Atleos (Non-GAAP) and Non-GAAP Diluted Earnings Per Share
Three months ended December 31, 2023
$ in millions, except per share amountsGross profit Gross profit rateIncome (loss) from operationsNet Income attributable to Atleos
Diluted Earnings per Share (1)
GAAP Results$198 18.0 %$35 $(161)$(2.28)
Plus: Special Items
Transformation and restructuring1 0.1 %3 22 0.30
Stock-based compensation expense2 0.2 %23 21 0.29
Acquisition-related amortization of intangibles20 1.8 %24 18 0.25
Separation costs 51 4.7 %65 81 1.10
Valuation allowance and other tax adjustments— — %— 42 0.57 
Pension market-to-market adjustments— — %— 28 0.38 
Non-GAAP Adjusted Results$272 24.8 %$150 $51 $0.69 
(1)For the three months ended December 31, 2023, due to the net loss attributable to Atleos common stockholders, potential common shares that would have caused dilution, such as restricted stock units and stock options, have been excluded from the GAAP diluted share count because their effect would have been anti-dilutive. The dilutive impact of these shares are included in the calculation of non-GAAP diluted EPS. Therefore, GAAP diluted EPS and non-GAAP diluted EPS may not mathematically reconcile.
10

Reconciliation of Net Income Attributable to Atleos (GAAP) to Adjusted Net Income Attributable to Atleos (Non-GAAP) and Non-GAAP Diluted Earnings Per Share
Three months ended December 31, 2022
$ in millions, except per share amountsGross profit Gross profit rateIncome (loss) from operationsNet Income attributable to Atleos
Diluted Earnings per Share (1)
GAAP Results$242 22.7 %$90 $7 $0.10 
Plus: Special Items
Transformation and restructuring4 0.4 %15 12 0.17
Stock-based compensation expense6 0.6 %15 10 0.14
Acquisition-related amortization of intangibles15 1.4 %24 19 0.27
Russia operations— — %— (3)(0.04)
Pension market-to-market adjustments— — %— 63 0.89 
Non-GAAP Adjusted Results$267 25.1 %$144 $108 $1.53 
(1)On October 16, 2023, the date of Separation, 70.6 million shares of Atleos' Common Stock, par value $0.01 per share, were distributed to Voyix shareholders of record as of October 2, 2023, the Record Date. This share amount is utilized for the calculation of basic and diluted earnings per share for all periods presented prior to the Separation. For the three months ended December 31, 2022, these shares are treated as issued and outstanding for purposes of calculating historical earnings per share. For periods prior to the Separation, it is assumed that there are no dilutive equity instruments as there were no equity awards of Atleos outstanding prior to the Separation.

Reconciliation of Net Income Attributable to Atleos (GAAP) to Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA) (Non-GAAP)
$ in millionsQ4 2023Q4 2022
Net income (loss) attributable to Atleos (GAAP)$(161)$7 
Interest expense69 8 
Interest income(5)— 
Income tax expense46 (4)
Depreciation and amortization expense43 44 
Acquisition-related amortization of intangibles24 24 
Stock-based compensation expense23 15 
Separation costs84 — 
Transformation and restructuring22 15 
Pension mark-to-market adjustments33 78 
Adjusted EBITDA (Non-GAAP) $178 $187 
11

Reconciliation of Net Cash Provided by Operating Activities (GAAP) to Adjusted Free Cash Flow-Unrestricted (Non-GAAP)
$ in millionsQ4 2023Q4 2022
Net cash provided by (used in) operating activities$(43)$33 
Total capital expenditures(47)(27)
Restricted cash settlement activity49 36 
Initial sale of trade accounts receivable(166)— 
Pension contributions145 1 
Adjusted free cash flow-unrestricted$(62)$43 
12
February 14, 2024 Tim Oliver, President & Chief Executive Officer Paul Campbell, Chief Financial Officer Stuart Mackinnon, Chief Operating Officer Fourth Quarter 2023 Earnings Call

 
FORWARD-LOOKING STATEMENTS NCR Atleos Corporation (“NCR Atleos,” “Atleos” or the “Company”) cautions that comments made during this presentation and in these materials contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 (the “Act”). Forward-looking statements use words such as “estimate,” “expect,” “target,” “anticipate,” “outlook,” “intend,” “plan,” “confident,” “believe,” “will,” “would,” “potential,” “positioned,” “may,” and words of similar meaning, as well as other words or expressions referencing future events, conditions or circumstances. We intend for these forward-looking statements to be covered by the safe harbor provisions for forward- looking statements contained in the Act. Statements that describe or relate to the Company's plans, targets, goals, intentions, strategies, or financial outlook, and statements that do not relate to historical or current fact, are examples of forward-looking statements. Examples of forward-looking statements in these materials include, without limitation, statements regarding the future commercial or financial performance of the Company following the separation from NCR Voyix Corporation (“Voyix”), and value creation and ability to innovate and drive growth generally as a result of such transaction; the expected financial performance of the Company for 2024; the Company's net leverage ratio targets for year-end 2024 and long-term; our expected areas of focus and strategy to drive growth and profitability and create long-term stockholder value, including key performance indicator targets and expectations for 2024; the Company's focus on advancing strategic growth initiatives and transforming the Company into a software-led ATM-as-a-service company with a higher mix of recurring revenue streams, including the Company's focus on driving efficiencies and standardizing cloud-native service offerings; statements regarding redeployment priorities, and future capital allocation priorities and our expected free cash flow for 2024; and our expectations of NCR Atleos' ability to deliver increased value to customers and stockholders. 2

 
FORWARD-LOOKING STATEMENTS Forward-looking statements are based on our current beliefs, expectations and assumptions, which may not prove to be accurate, and involve a number of known and unknown risks and uncertainties, many of which are out of the Company's control, including the failure of NCR Atleos to achieve some or all of the expected strategic benefits or opportunities expected from the spin-off, that NCR Atleos may incur material costs and expenses as a result of the spin-off, that NCR Atleos has no pre-spin operating history as an independent, publicly traded company, and NCR Atleos' historical and pro forma financial information is not necessarily representative of the results that it would have achieved as a separate, publicly traded company and therefore may not be a reliable indicator of its future results, NCR Atleos' obligation to indemnify NCR Voyix pursuant to the agreements entered into connection with the spin-off (including with respect to material taxes) and the risk NCR Voyix may not fulfill any obligations to indemnify NCR Atleos under such agreements, that under applicable tax law, NCR Atleos may be liable for certain tax liabilities of NCR Voyix following the spin-off if NCR Voyix were to fail to pay such taxes, that agreements binding on NCR Atleos restrict it from taking certain actions after the distribution that could adversely impact the intended U.S. federal income tax treatment of the distribution and related transactions, potential liabilities arising out of state and federal fraudulent conveyance laws, the fact that NCR Atleos may receive worse commercial terms from third-parties for services it presently receives from NCR Voyix, that after the spin-off, certain of NCR Atleos' executive officers and directors may have actual or potential conflicts of interest because of their previous positions at NCR Voyix, potential difficulties in maintaining relationships with key personnel, NCR Atleos will not be able to rely on the earnings, assets or cash flow of NCR Voyix and NCR Voyix will not provide funds to finance NCR Atleos' working capital or other cash requirements. Forward-looking statements are not guarantees of future performance, and there are a number of important factors that could cause actual outcomes and results to differ materially from the results contemplated by such forward-looking statements. As you read and consider this presentation, you should understand that these statements are not guarantees of performance or results. Although the Company believes that assumptions underlying the forward-looking statements contained herein are reasonable, should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, any of these statements included herein may prove to be inaccurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that the results or conditions described in such statements or our objectives and plans will be achieved. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. Additional information concerning these and other factors can be found in the Company's filings with the U.S. Securities and Exchange Commission (“SEC”), including the Company's registration statement on Form 10 and amendments thereto, the final information statement, included as an exhibit to the Company's current report on Form 8-K filed with the SEC on August 15, 2023, quarterly reports on Form 10-Q and current reports on Form 8-K. These materials are dated February 14, 2024, and Atleos does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. 3

 
NON-GAAP MEASURES. While Atleos reports its results in accordance with generally accepted accounting principles in the United States, or GAAP, comments made during this conference call and in these materials will include or make reference to certain "non-GAAP" measures, including: adjusted gross margin rate (non-GAAP); diluted earnings per share (non-GAAP); adjusted free cash flow-unrestricted; adjusted gross margin (non- GAAP); net debt; adjusted EBITDA; adjusted EBITDA growth; adjusted EBITDA margin; the ratio of net debt to adjusted EBITDA or Net Leverage Ratio; adjusted income from operations (non-GAAP); adjusted interest and other expense (non-GAAP); adjusted income tax expense (non-GAAP); effective income tax rate (non-GAAP); and adjusted net income attributable to Atleos (non-GAAP). These measures are included to provide additional useful information regarding Atleos' financial results, and are not a substitute for their comparable GAAP measures. Explanations of these non-GAAP measures, and reconciliations of these non-GAAP measures to their directly comparable GAAP measures, are included in the accompanying "Supplementary Materials" and are available on the Investor Relations page of Atleos' website at www.ncratleos.com. Descriptions of many of these non-GAAP measures are also included in Atleos' SEC reports. TRADEMARKS. All trademarks, service marks and trade names appearing in this presentation are, to our knowledge, the property of their respective owners. We do not intend our use or display of other companies’ trademarks, service marks, copyrights or trade names to imply a relationship with, or endorsement or sponsorship of us by, any other companies. USE OF CERTAIN TERMS. As used in these materials: (i) the term "recurring revenue" includes all revenue streams from contracts where there is a predictable revenue pattern that will occur at regular intervals with a relatively high degree of certainty. This includes hardware and software maintenance revenue, processing revenue, interchange and network revenue, Bitcoin-related revenue, and certain professional services arrangements, as well as term-based software license arrangements that include customer termination rights. (ii) the term "annual recurring revenue" or "ARR" is recurring revenue, excluding software license sold as a subscription, for the last three months times four, plus the rolling four quarters for term-based software license arrangements that include customer termination rights. (iii) the term "LTM" means last twelve months. (iv) the term "ARPU" means average revenue per unit. (v) the term "ATMaaS" means ATM-as-a-Service, our turnkey, end-to-end ATM platform solution. These presentation materials and the associated remarks made during this conference call are integrally related and are intended to be presented and understood together. Websites referenced in this presentation are not incorporated by reference into the presentation. NOTES TO INVESTORS 4

 
Business Update Tim Oliver President and Chief Executive Officer 5

 
Good Q4 Outstanding 2023 Positioned for a Successful 2024 Executed split and achieved strategic objectives Grew revenue 1% to $4 billion, recurring revenue grew 7% and recurring mix increased to 71% from 68% Added 6K of ATMaaS units to finish the year at 20K+ 10+ new FI partners added in 2023 Revenue up 3% y/y and sequentially; Recurring revenue up 10% y/y Solid underlying profit trends ATMaaS wins in North America, Asia, and Europe with strong backlog into 2024 North America withdrawal volumes greater than pre- pandemic years Reaffirmed 2024 financial targets Strategy has been validated and is on track Robust fundamentals with banks seeking solutions for efficiencies and customer retention Strong ATMaaS backlog and pipeline visibility to finish the year at 30K+ units Network revenue growth expected in all regions globally Strong Performance and Momentum 6

 
Segment Operational Highlights Recent Account Wins Recent Account Wins • Installed 2,000 ATMaaS units, exceeding 20K installed units • Q4 orders were very strong, boosting our H1 backlog • Achieved record output levels from our manufacturing facilitates • Strong profitability and cash flow generation • ASDA retail locations online and providing increase to profit in Q4 • Highest volumes in North America in the past 5 years • Continued analysis of ATM locations Self-Service Banking Network 7

 
Differentiate & Grow Key Objectives for 2024 ■ Offer best-in-class solutions and service ■ Leverage existing operations ■ Expand markets and transaction sets ■ Advance ATMaaS model Optimize Resource Allocation Complete Separation ■ Complete the transfer of operations in certain markets that remained after transaction close ■ Wind down TSA agreements ■ Establish a culture of continuous improvement ■ Identify and realize efficiency opportunities ■ Apply disciplined approach to investment ■ Allocate capital to enhance shareholder value 8

 
Financial Review Paul Campbell Chief Financial Officer 9

 
Total Revenue/Recurring Q4 2023 CONSOLIDATED FINANCIAL RESULTS Q4 22 Q4 23 $0 $500 $1,000 $ in millions, except percentages and per share amounts $1,065 $187$1,098 $178 $709 $777 ■ Q4 '23 Revenue of $1,098M, +3% y/y ■ Q4 '23 Recurring Revenue of $777M, +10% y/y ■ Q4 '23 Adjusted EBITDA of $178M ■ Excluding items that impacted y/y comparability, estimate that Q4 '23 Adjusted EBITDA would have increased y/y 10 ■ Fourth Quarter Non-GAAP Diluted EPS of $0.69 As Reported As Reported Normalized (1)Normalized (1) Q4 22 Q4 23 7% Q4 22 Q4 23 $0 $100 $200 Q4 22 Q4 23 7% Adjusted EBITDA (1) Normalizing Q4 2022 for the estimated impact of delayed legal entity transfers and separation dis-synergies, as applicable.

 
Adjusted EBITDA Q4 22 Q1 23 Q2 23 Q3 23 Q4 23 40% 50% 60% $ in millions, except units and percentages SELF-SERVICE BANKING Revenue Q4 22 Q4 23 $600 $660 $720 Q4 22 Q4 23 $105 $140 $175 $683 Q4 22 Q1 23 Q2 23 Q3 23 Q4 23 10 15 20 Recurring Revenue % ATMaaS Units (in thousands) ARR(2) Up 900 bps y/y Up 43% y/y Q4 22 Q1 23 Q2 23 Q3 23 Q4 23 $1,400 $1,500 $1,600 Up 7% y/y Key Strategic Metrics 49% $159 18.2 $1,551 59% $665 $146 20.4 $1,532 58% 14.3 $1,430 (1) Normalizing Q4 2022 for the estimated impact of delayed legal entity transfers and separation dis-synergies, as applicable. (2) Dashed line reflects the impact of delayed legal entity transfers on current period. 11 $1,607 Q4 22 Q4 23 2% Normalized(1) Q4 22 Q4 23 Normalized(1)As Reported 1% As Reported

 
Q4 22 Q1 23 Q2 23 Q3 23 Q4 23 80 85 90 $ in millions, except units and ARPU NETWORK Q4 22 Q4 23 $0 $175 $350 Q4 22 Q4 23 $0 $65 $130$298 Q4 22 Q1 23 Q2 23 Q3 23 Q4 23 $13.5 $14.0 $14.5 $15.0 $15.5 Self-Service Banking Terminal Network (in thousands) LTM ARPU (in thousands) Down 1% y/y Up 7% y/y 84 $81 $14.8 83 $323 $100 $15.1 83 $14.1 Key Strategic Metrics Revenue Adjusted EBITDA 12

 
Segment Summary & Financial Position (1) Cash and cash equivalents as presented on our Consolidated Balance Sheets. (2) Refer to the definitions in the supplementary section of the presentation. Balance Sheet & Liquidity December 31, 2023 Liquidity $712 Revolving Credit Availability $337 Cash (unrestricted)1 $375 Total Debt $3,014 Net Debt2 $2,639 Net Leverage Ratio2 3.6X 13 Segment Summary Revenue Q4 2023 Q4 2022 Self-Service Banking $665 $683 Network 323 298 Technology & Telecommunications 48 53 Other 62 31 Total Atleos $1,098 $1,065 Adjusted EBITDA Q4 2023 Q4 2022 Self-Service Banking $146 $159 Network 100 81 Technology & Telecommunications 7 12 Other 8 10 Corporate (83) (75) Total Atleos $178 $187 $ in millions

 
$ in millions, except per share amounts 2024 Financial Outlook Q1 2024 Targets FY 2024 Targets Low High Low High Revenue $1,000 $1,050 $4,200 $4,400 Adjusted EBITDA $150 $160 $770 $800 Fully Diluted EPS $0.30 $0.40 $2.90 $3.20 Adjusted Free Cash Flow positive $170 $230 14

 
Takeaways Solid Fourth Quarter and 2023 Results Effectively Advancing Our Strategy: ATM as a Service Positive Momentum Heading Into 2024 Strong Fundamentals and Opportunity to Create Value 15

 
SUPPLEMENTARY MATERIALS 16

 
While Atleos reports its results in accordance with generally accepted accounting principles (GAAP) in the United States, comments made during this conference call and in these materials will include non-GAAP measures. These measures are included to provide additional useful information regarding Atleos' financial results, and are not a substitute for their comparable GAAP measures. Non-GAAP Diluted Earnings Per Share (EPS), Adjusted Gross Margin (non-GAAP), Adjusted Gross Margin Rate (non-GAAP), Adjusted Operating Expenses (non-GAAP), Adjusted Income from Operations (non-GAAP), Adjusted Operating Margin Rate (non-GAAP), Adjusted Interest and Other (Expense) (non- GAAP), Adjusted Income Tax Expense (non-GAAP), Adjusted Effective Income Tax Rate (non-GAAP), and Adjusted Net Income from Continuing Operations Attributable to Atleos (non-GAAP). Atleos’ non-GAAP diluted EPS, adjusted gross margin (non-GAAP), adjusted gross margin rate (non-GAAP), adjusted operating expenses (non-GAAP), operating income (non-GAAP), operating margin rate (non-GAAP), interest and other (expense) (non-GAAP), income tax expense (non-GAAP), adjusted effective income tax rate (non-GAAP), and adjusted net income from continuing operations attributable to Atleos (non-GAAP) are determined by excluding, as applicable, pension mark-to-market adjustments, pension settlements, pension curtailments and pension special termination benefits, as well as other special items, including separation-related costs, amortization of acquisition related intangibles, stock-based compensation expense, and transformation and restructuring activities, from Atleos’ GAAP earnings per share, gross margin, gross margin rate, expenses, income from operations, operating margin rate, interest and other income (expense), income tax expense, effective income tax rate and net income from continuing operations attributable to Atleos, respectively. Due to the non-operational nature of these pension and other special items, Atleos' management uses these non-GAAP measures to evaluate year-over-year operating performance. Atleos believes these measures are useful for investors because they provide a more complete understanding of Atleos' underlying operational performance, as well as consistency and comparability with Atleos' past reports of financial results. Adjusted Free Cash Flow-Unrestricted. Atleos defines adjusted free cash flow-unrestricted as net cash provided by (used in) operating activities less capital expenditures for property, plant and equipment, less additions to capitalized software, plus/minus the change in restricted cash settlement activity, plus/minus net reductions or reinvestment in the trade receivables facility established in the fourth quarter of 2023 due to fluctuations in the outstanding balance of receivables sold, and plus pension contributions and pension settlements. Restricted cash settlement activity represents the net change in amounts collected on behalf of, but not yet remitted to, certain of the Company’s merchant customers or third-party service providers that are pledged for a particular use or restricted to support these obligations. These amounts can fluctuate significantly period to period based on the number of days for which settlement to the merchant has not yet occurred or day of the week on which a reporting period ends. Atleos' management uses adjusted free cash flow-unrestricted to assess the financial performance of the Company and believes it is useful for investors because it relates the operating cash flow of the Company to the capital that is spent to continue and improve business operations. In particular, adjusted free cash flow-unrestricted indicates the amount of cash generated after capital expenditures, which can be used for, among other things, investment in the Company's existing businesses, strategic acquisitions, strengthening the Company's balance sheet, repurchase of Company stock and repayment of the Company's debt obligations. Adjusted free cash flow-unrestricted does not represent the residual cash flow available for discretionary expenditures since there may be other non-discretionary expenditures that are not deducted from the measure. Adjusted free cash flow-unrestricted does not have uniform definitions under GAAP and, therefore, Atleos' definitions may differ from other companies' definitions of these measures. NON-GAAP MEASURES 17

 
Net Debt. Atleos determines Net Debt based on its total debt less cash and cash equivalents, with total debt being defined as total short-term borrowings plus total long-term debt. Atleos believes that Net Debt provides useful information to investors because Atleos’ management reviews Net Debt as part of its management of overall liquidity, financial flexibility, capital structure and leverage. In addition, certain debt rating agencies, creditors and credit analysts monitor Atleos’ Net Debt as part of their assessments of Atleos’ business. Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA). Atleos determines Adjusted EBITDA based on GAAP Net income attributable to Atleos plus interest expense, net; plus income tax expense (benefit); plus depreciation and amortization; plus acquisition-related costs; plus pension mark-to-market adjustments, pension settlements, pension curtailments and pension special termination benefits; plus separation-related costs; plus transformation and restructuring charges (which includes integration, severance and other exit and disposal costs); plus stock-based compensation expense; plus other special (expense) income items. These adjustments are considered non-operational or non-recurring in nature and are excluded from the Adjusted EBITDA metric utilized by our chief operating decision maker (“CODM”) in evaluating segment performance and are separately delineated to reconcile back to total reported income attributable to Atleos. Atleos uses Adjusted EBITDA to manage and measure the performance of its business segments. Atleos also uses Adjusted EBITDA to manage and determine the effectiveness of its business managers and as a basis for incentive compensation. Atleos believes that Adjusted EBITDA provides useful information to investors because it is an indicator of the strength and performance of the Company's ongoing business operations, including its ability to fund discretionary spending such as capital expenditures, strategic acquisitions and other investments. Adjusted EBITDA margin is calculated based on Adjusted EBITDA as a percentage of total revenue. Net Leverage Ratio. Atleos believes that its ratio of Net Debt to Adjusted EBITDA, or Net Leverage Ratio, provides useful information to investors because it is an indicator of the Company's ability to meet its future financial obligations. In addition, the Net Debt to Adjusted EBITDA ratio is a measure frequently used by investors and credit rating agencies. The Net Debt to Adjusted EBITDA ratio is calculated by dividing Net Debt by trailing twelve-month Adjusted EBITDA. Special Item Related to Russia. The war in Eastern Europe and related sanctions imposed on Russia and related actors by the United States and other jurisdictions required us to commence the orderly wind down of our operations in Russia in the first quarter of 2022. As of December 31, 2023, we have ceased operations in Russia and are in process of dissolving our only subsidiary in Russia. As a result, for the three months ended December 31, 2022, our non-GAAP presentation of the measures described above exclude the immaterial impact of our operating results in Russia, as well as the impact of impairments taken to write down the carrying value of assets and liabilities, severance charges, and the assessment of collectability on revenue recognition. No charges have been recognized for the three months ended December 31, 2023. We consider this to be a non-recurring special item and management has reviewed the results of its business segments excluding these impacts. NON-GAAP MEASURES 18

 
Atleos management's definitions and calculations of these non-GAAP measures may differ from similarly-titled measures reported by other companies and cannot, therefore, be compared with similarly-titled measures of other companies. These non-GAAP measures should not be considered as substitutes for, or superior to, results determined in accordance with GAAP. These non-GAAP measures are reconciled to their corresponding GAAP measures in the following slides and elsewhere in these materials. These reconciliations and other information regarding these non-GAAP measures are also available on the Investor Relations page of Atleos' website at www.ncratleos.com. NON-GAAP MEASURES 19

 
Q4 2023 Q4 2022 % Change Revenue $1,098 $1,065 3% Gross Margin 198 242 (18)% Gross Margin Rate 18.0% 22.7% Operating Expenses 163 152 7% % of Revenue 14.8% 14.3% Operating Income 35 90 (61)% % of Revenue 3.2% 8.5% Interest and other expense, net (149) (89) 67% Income Tax Expense (Benefit) 46 (4) Effective Income Tax Rate (40.4)% (400.0)% Net Income (Loss) attributable to Atleos $(161) $7 (2,400)% Diluted EPS attributable to Atleos $(2.28) $0.10 (2,380)% $ in millions, except per share amounts Q4 2023 GAAP RESULTS 20

 
Q4 2023 Q4 2022 % Change Revenue $1,098 $1,065 3% Adjusted Gross Margin (non-GAAP) 272 267 2% Adjusted Gross Margin Rate (non-GAAP) 24.8% 25.1% Adjusted Operating Expenses (non-GAAP) 122 123 (1)% % of Revenue 11.1% 11.5% Adjusted Income from Operations (non-GAAP) 150 144 4% % of Revenue (Adjusted Operating Margin Rate) 13.7% 13.5% Adjusted Interest and other expense (non-GAAP) (78) (11) 609% Adjusted Income Tax Expense (non-GAAP) 20 27 (26)% Adjusted Effective Income Tax Rate (non-GAAP) 27.8% 20.3% Adjusted Net Income (Loss) attributable to Atleos (non-GAAP) $51 $108 (53)% Diluted EPS attributable to Atleos (non-GAAP) $0.69 $1.53 (55)% $ in millions, except per share amounts Q4 2023 OPERATIONAL RESULTS (Non-GAAP) 21

 
Q4 2023 Q4 2022 Net (Loss) Income Attributable to NCR (GAAP) $ (161) $ 7 Pension Mark-to-Market Adjustments 33 78 Transformation & Restructuring Costs 22 15 Acquisition-Related Amortization of Intangibles 24 24 Separation Costs 84 — Interest Expense 69 8 Interest Income (5) — Depreciation and Amortization 43 44 Income Taxes 46 (4) Stock-Based Compensation Expense 23 15 Adjusted EBITDA (non-GAAP) $ 178 $ 187 GAAP TO NON-GAAP RECONCILIATION $ in millions 22

 
GAAP TO NON-GAAP RECONCILIATION $ in millions, except per share amounts Gross Margin Gross Margin rate Operating Expenses Income (loss) from operations Interest & Other Expenses, Net Income Tax Expense (Benefit) Effective Income Tax Rate Net Income attributable to Atleos Diluted Earnings per Share(1) GAAP Results $198 18.0% $163 $35 $(149) $46 (40.4)% $(161) $(2.28) Plus: Special Items Transformation and restructuring costs 1 0.1% (2) 3 19 — 22 0.30 Stock-based compensation expense 2 0.2% (21) 23 — 2 21 0.29 Acquisition-related amortization of intangibles 20 1.8% (4) 24 — 6 18 0.25 Separation costs 51 4.7% (14) 65 19 3 81 1.10 Valuation allowance and other tax adjustments — —% — — — (42) 42 0.57 Pension market-to-market adjustments — —% — — 33 5 28 0.38 Non-GAAP Adjusted Results $272 24.8% $122 $150 $(78) $20 27.8% $51 $0.69 Q4 2023 23 (1) For the three months ended December 31, 2023, due to the net loss attributable to Atleos common stockholders, potential common shares that would have caused dilution, such as restricted stock units and stock options, have been excluded from the GAAP diluted share count because their effect would have been anti-dilutive. The dilutive impact of these shares are included in the calculation of non-GAAP diluted EPS. Therefore, GAAP diluted EPS and non-GAAP diluted EPS may not mathematically reconcile.

 
GAAP TO NON-GAAP RECONCILIATION $ in millions, except per share amounts Gross Margin Gross Margin rate Operating Expenses Income (loss) from operations Interest & Other Expenses, Net Income Tax Expense (Benefit) Effective Income Tax Rate Net Income attributable to Atleos Earnings per Share(1) GAAP Results $242 22.7% $152 $90 $(89) $(4) (400.0)% $7 $0.10 Plus: Special Items Transformation and restructuring costs 4 0.4% (11) 15 — 3 12 0.17      Stock-based compensation expense 6 0.6% (9) 15 — 5 10 0.14 Acquisition-related amortization of intangibles 15 1.4% (9) 24 — 5 19 0.27 Russia — —% — — — 3 (3) (0.04) Pension market-to-market adjustments — —% — — 78 15 63 0.89 Non-GAAP Adjusted Results $267 25.1% $123 $144 $(11) $27 20.3% $108 $1.53 Q4 2022 24 (1) On October 16, 2023, the date of Separation, 70.6 million shares of Atleos' Common Stock, par value $0.01 per share, were distributed to Voyix shareholders of record as of October 2, 2023, the Record Date. This share amount is utilized for the calculation of basic and diluted earnings per share for all periods presented prior to the Separation. For the three months ended December 31, 2022, these shares are treated as issued and outstanding for purposes of calculating historical earnings per share. For periods prior to the Separation, it is assumed that there are no dilutive equity instruments as there were no equity awards of Atleos outstanding prior to the Separation.

 
Self-Service Banking Network T&T Other(1) Corporate(2) Unallocated Total Product Revenue $232 $22 $3 $25 $— $282 Service Revenue $433 $301 $45 $37 $— $816 Total Revenue $665 $323 $48 $62 $— $1,098 Cost of Products $169 $18 $2 $23 $15 $227 Cost of Services $358 $226 $38 $32 $19 $673 SG&A and R&D Expenses(3) $47 $32 $6 $3 $75 $163 Income from Operations $91 $47 $2 $4 $(109) $35 Q4 2023 SEGMENT RESULTS - GAAP $ in millions 25 (1) Other represents certain other immaterial business operations, including commerce-related operations in countries that Voyix exited that are aligned to Atleos, that do not represent a reportable segment. For periods after the separation from Voyix, Other also includes revenues from commercial agreements with Voyix. (2) Corporate includes income and expenses related to corporate functions that are not specifically attributable to an individual reportable segment. (3) Selling, general and administrative expenses is presented as "SG&A" and research and development expenses is presented as "R&D" above.

 
Self-Service Banking Network T&T Other(1) Corporate(2) Unallocated Total Product Revenue $232 $22 $3 $25 $— $282 Service Revenue $433 $301 $45 $37 $— $816 Total Revenue $665 $323 $48 $62 $— $1,098 Adjusted Cost of Products (non-GAAP) $169 $18 $2 $23 $15 $227 Adjusted Cost of Services (non-GAAP) $316 $206 $33 $30 $14 $599 Adjusted SG&A and R&D Expenses(3) (non-GAAP) $45 $28 $6 $2 $41 $122 Adjusted Income from Operations (non-GAAP) $135 $71 $7 $7 $(70) $150 Adjusted EBITDA (non- GAAP) $146 $100 $7 $8 $(83) $178 Q4 2023 SEGMENT RESULTS - NON-GAAP $ in millions 26 (1) Other represents certain other immaterial business operations, including commerce-related operations in countries that Voyix exited that are aligned to Atleos, that do not represent a reportable segment. For periods after the separation from Voyix, Other also includes revenues from commercial agreements with Voyix. (2) Corporate includes income and expenses related to corporate functions that are not specifically attributable to an individual reportable segment. (3) Selling, general and administrative expenses is presented as "SG&A" and research and development expenses is presented as "R&D" above.

 
GAAP Transformation Costs Stock Based Compensation Acquisition Related Amortization of Intangibles Separation Costs Non-GAAP Self Service Banking $ 358 $ — $ — $ — $ (42) $ 316 Network 226 — — (20) — 206 T&T 38 — — — (5) 33 Other 32 (1) — — (1) 30 Corporate Unallocated 19 — (2) — (3) 14 Total Cost of Services 673 (1) (2) (20) (51) 599 Self Service Banking 47 — — — (2) 45 Network 32 — — (4) — 28 Other 3 (1) — — — 2 Corporate Unallocated 75 (1) (21) — (12) 41 Total SG&A and R&D Expenses 163 (2) (21) (4) (14) 122 Self Service Banking 91 — — — 44 135 Network 47 — — 24 — 71 T&T 2 — — — 5 7 Other 4 2 — — 1 7 Corporate Unallocated (109) 1 23 — 15 (70) Total Income from Operations $ 35 $ 3 $ 23 $ 24 $ 65 $ 150 Q4 2023 GAAP TO NON-GAAP Segment Reconciliation $ in millions 27 Figures presented above that are non-bolded represent the only segments that create adjustments from GAAP to non-GAAP for the applicable bolded Total financial results above. The reconciliations above do not include figures that do not differ from the GAAP figures presented on the prior pages. Therefore, GAAP and Non-GAAP column totals may not sum from segment rows above.

 
Q4 2023 Q4 2022 Cash provided by operating activities $(43) $33 Total capital expenditures $(47) $(27) Initial sale of accounts receivables $(166) $— Pension contributions $145 $1 Restricted cash settlement activity $49 $36 Adjusted Free Cash Flow-Unrestricted $(62) $43 $ in millions GAAP TO NON-GAAP RECONCILIATION 28

 
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v3.24.0.1
Document and Entity Information
Feb. 14, 2024
Document and Entity Information  
Document Type 8-K
Document Period End Date Feb. 14, 2024
Entity Registrant Name NCR ATLEOS CORPORATION
Entity File Number 001-41728
Entity Incorporation, State or Country Code MD
Entity Tax Identification Number 92-3588560
Entity Address, Address Line One 864 Spring Street NW
Entity Address, City or Town Atlanta
Entity Address, State or Province GA
Entity Address, Postal Zip Code 30308
City Area Code 937
Local Phone Number 445-1936
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, par value $0.01 per share
Trading Symbol NATL
Security Exchange Name NYSE
Entity Emerging Growth Company false
Entity Central Index Key 0001974138
Amendment Flag false
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