The National Cash Register Corporation, which has been around since 1884, is responsible for inventing the first mechanical cash register and the commercialization of the first barcode scanners in 1974, but keeping up with today's technology might not be paying off.
The Duluth, Ga.-based company is the world's largest ATM producer, but according to a new report by Spruce Point Capital, a hedge fund known for its short-selling research, NCR isn't keeping up with the new technology of e-payments. The company has struggled amid softness in demand from retail customers, many of whom are turning away from traditional point-of-sale technology and toward mobile-payment devices.
NCR reported in April that its diluted earnings per share fell 26%, to 23 cents, in the first quarter, although revenues slid only 3%, to $1.48 billion.
The company has a market value of nearly $5 billion. NCR has been under pressure by shareholders to improve their performance by developing and acquiring high-margin software such as cloud, other applications and services.
“It is our goal to become more of a software and SaaS company,” NCR's Chief Information Officer Bill VanCuren stated. “Right now we are in the Top 50 software companies in the world.”
Recently, Anheuser-Busch Employees' Credit Union began offering online and mobile banking solutions from Digital Insight, an NCR company.
Anheuser-Busch Employees Credit Union will offer Digital Insight's suite of SaaS solutions including online banking and iOS, and Android mobile and tablet banking. The credit union already offers other customer experiences through NCR software and technology, including video banking services through NCR Interactive Teller.
“We are excited about the omni-channel experience that NCR offers,” Calvin Curdt, vice president, information systems of the $1.5 billion asset Anheuser-Busch Employees' Credit Union said. “Our members expect a seamless experience across all channels. NCR, with Digital Insight, is the only vendor who can unlock that consistent experience for our members.
In the 90s, NCR struggled to keep up with the growing computer market and was forced to reduce costs by trying to cut its work force by 7,500 people. They also reduced its worldwide work force of 51,000 people by as much as 15%.
NCR stock has fallen 11% in the past 12 months, underperforming the S&P 500 index, and is trading slightly below where it was 10 years ago. The stock's underperformance has also attracted activist investor Jana Partners LLC, which in February disclosed a 7% passive stake.
Originally called National Cash Register Company, NCR was owned for a time in the 1990s by AT&T Inc. In 2007, NCR spun off its Teradata computing business to shareholders. Today, that company has a $6.3 billion market value. Recently NCR announced they are moving their headquarters into a new, $260 million home near Georgia Tech in Atlanta.
A full sale of the company has also been mentioned, but many in the know say that is a less likely outcome.
“We're still looking at strategic alternatives and evaluating opportunities to divest non-core businesses,” Nuti said according to a transcript of the company's fourth quarter earnings report on Seeking Alpha. “That's underway, so no major change there. And we'll continue to look at that throughout the year and come back to you at some point when we have more definitive follow up.”
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