10-K: NCR Atleos Reports Strong 2025 Growth, Merger with Brinks Announced

NCR Atleos Corporation reported a 103% surge in net income to $162 million on a 1% revenue increase to $4.354 billion for fiscal year 2025, alongside a definitive merger agreement with The Brinks Company.

Summary

• Total revenue increased 1% to $4.354 billion in 2025, from $4.305 billion in 2024.
• Net income attributable to Atleos more than doubled, rising 103% to $162 million in 2025, from $80 million in 2024.
• Adjusted EBITDA increased 6% to $830 million in 2025, from $785 million in 2024, with Adjusted EBITDA margin improving to 19.1% from 18.2%.
• Self-Service Banking revenue grew 7% to $2.881 billion, driven by a 14% increase in hardware revenue and a 33% growth in ATM as a Service (ATMaaS) solutions.
• Network segment revenue decreased 1% to $1.265 billion, primarily due to lower withdrawal transactions from U.S. immigration policies and reduced Bitcoin transaction volumes, partially offset by international market growth.
• Telecommunications & Technology (T&T) revenue decreased 13% to $168 million due to declines in hardware maintenance, installation services, and third-party hardware sales.
• Recurring revenue constituted 70.6% of total revenue in 2025, a slight decrease from 72.6% in 2024, but the company continues its transition to a software-led, as-a-service model.
• Research and development expenses increased 13% to $70 million in 2025, reflecting increased employee-related costs.
• The company repurchased approximately 0.8 million shares of common stock for $28 million in 2025 under a $200 million share repurchase program.
• A definitive merger agreement was announced on February 26, 2026, for The Brinks Company to acquire Atleos for $30.00 in cash and 0.1574 shares of Brinks common stock per Atleos share, expected to close in Q1 2027.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this as a positive report, primarily due to the significant increase in net income and Adjusted EBITDA, coupled with strong growth in the strategic ATMaaS segment. The announced merger with Brinks also provides a clear future path and potential value for shareholders. However, the slight decline in recurring revenue percentage and the revenue decrease in the Network and T&T segments temper the overall positive sentiment.

Positives

• Net income attributable to Atleos increased significantly by 103% to $162 million in 2025.
• Adjusted EBITDA grew 6% to $830 million, with an improved margin of 19.1%.
• Self-Service Banking revenue increased 7%, driven by strong hardware demand (up 14%) and substantial growth in ATM as a Service (ATMaaS) solutions (up 33%).
• Gross margin as a percentage of revenue increased to 24.4% in 2025 from 23.7% in 2024, attributed to hardware and ATMaaS growth.
• Selling, general, and administrative expenses decreased by $8 million and 30 basis points to 11.8% of revenue, due to cost optimization, gains on sale-leaseback of ATMs, and lower separation-related costs.
• Successfully remediated a material weakness in internal controls related to contract cancellations and customer credits as of December 31, 2025.
• The company maintains a strong liquidity position with $456 million in cash and cash equivalents and $447 million in borrowing capacity under its revolving credit facility as of December 31, 2025.
• The company announced a definitive merger agreement with The Brinks Company, offering $30.00 in cash and 0.1574 shares of Brinks common stock per Atleos share.

Negatives

• Total revenue growth was modest at 1% year-over-year.
• Network segment revenue decreased 1%, impacted by U.S. immigration policies leading to fewer prepaid payroll card transactions and lower Bitcoin transaction volumes.
• Adjusted EBITDA for the Network segment decreased 11%, primarily due to increased vault cash costs and a decrease in higher-margin revenue streams.
• Telecommunications & Technology (T&T) revenue decreased 13% due to declines in hardware maintenance, installation services, and third-party hardware sales.
• Recurring revenue as a percentage of total revenue slightly decreased from 72.6% in 2024 to 70.6% in 2025.
• Vault cash interest expense increased, partially offsetting gross margin improvements.
• The company incurred increased Voyix environmental indemnification expense of $28 million due to accelerated investigatory and remedial activities at the Kalamazoo River site.
• The company is subject to macroeconomic pressures such as higher interest rates, increased logistics costs, tariffs, and foreign currency fluctuations.

Risks

• Failure to successfully grow the business, especially the shift to a softwareand services-led enterprise provider and ATM as a Service, could negatively impact results.
• Inability to develop and introduce new solutions in a rapidly changing technology environment, including artificial intelligence, could impact business results.
• Failure to compete effectively within the intensely competitive technology industry, facing large financial services companies, equipment manufacturers, and new competitors (e.g., Venmo, Zelle, Bitcoin), could reduce market share and revenue.
• Risks associated with integrating acquisitions or managing alliance activities, including business disruption, increased expenses, retention of key employees, and unknown liabilities, could adversely impact operating results.
• Multinational operations expose the company to business and legal risks, including economic conditions, political instability, tariffs, currency fluctuations, and compliance with diverse laws.
• Adverse impact from domestic and global economic and credit conditions, particularly affecting the financial sector, could impact customer capital expenditures and ability to pay.
• Tariffs and other trade measures could increase input costs, disrupt supply chains, and cause adverse financial impacts.
• Significant risks from the payments-related business, including decreased ATM usage due to alternative payment methods (e.g., mobile payments, virtual currencies) and changes in transaction fees, could reduce revenue.
• Reliance on bank sponsorship for electronic debit networks; loss of any sponsors or non-compliance with EFT network rules could disrupt operations and expose the company to fines.
• Errors or omissions in settlement of merchant funds or vault cash reconciliations could damage relationships and expose the company to liability.
• Maintaining a significant amount of vault cash involves risk of loss due to theft, civil unrest, or natural disasters, and is subject to cost fluctuations based on interest rate movements.
• Inability to retain key employees or attract quality new talent in a competitive market could hinder business objectives.
• Defects, errors, installation difficulties, or development delays in products could expose the company to liability, harm its reputation, and increase costs.
• If third-party suppliers upon which the company relies are not able to fulfill its needs, the ability to timely bring products to market could be affected.
• A major natural disaster or catastrophic event, including civil unrest, geopolitical instability, war, terrorist attack, or pandemics, could have a materially adverse effect on business.
• Historical and ongoing manufacturing activities subject the company to environmental exposures, with potential material adverse impacts from compliance costs.
• Climate change could adversely impact the business long-term, including critical infrastructure disruption, higher losses, and increased costs due to new regulations (e.g., EV transition, critical mineral supply, carbon taxes).
• Data protection, cybersecurity, and data privacy issues could lead to unauthorized access, disclosure of data, claims, costs, and reputational harm, especially with evolving threats like AI and complex global regulations (e.g., GDPR, CCPA, BIPA).
• High leverage ($2,798 million indebtedness) could require a substantial portion of cash flow for debt service, limit additional borrowing, and increase vulnerability to economic downturns or interest rate increases.
• Restrictive covenants in debt agreements could limit financial and business operations, affecting the ability to react to market conditions or pursue opportunities.
• Despite current debt levels, the company may incur substantially more debt, increasing related risks.
• Inability to continue to access or renew financing sources and obtain capital could adversely impair the ability to maintain and grow the business.
• Cash flows may be insufficient to service indebtedness, potentially requiring asset sales or refinancing.
• Exposure to interest rate risk due to variable-rate debt and vault cash rental expenses could cause debt service obligations or other costs to increase significantly.
• Terms governing the trade receivables facility could restrict financial and business operations if not renewed or if termination events occur.
• A lowering or withdrawal of debt ratings by rating agencies may increase future capital costs and reduce access to capital.
• Pension liabilities ($248 million underfunded U.S. plan as of December 31, 2025) could adversely impact liquidity and financial condition, with potential for material increases in cash contributions.
• Requirement to write down the value of certain significant assets (e.g., deferred tax assets, goodwill) could adversely impact operating results.
• Failure or inability to protect intellectual property, and other issues related to intellectual property, especially third-party infringement claims, could have a material adverse effect on the business.
• Changes to tax rates and additional income tax liabilities (e.g., from OECD BEPS, new climate disclosure rules) could impact profitability.
• Uncertainties with regard to regulations, lawsuits, and other related matters, including consumer protection requirements and class action litigation, could result in material adverse impacts.
• Changes to cryptocurrency regulations could impact profitability, requiring product changes, restricting offerings, or implementing costly controls.
• If Atleos is unable to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act, or its internal control over financial reporting is not effective, the reliability of financial statements may be questioned and stock price may suffer.
• Voyix may fail to perform under various transaction agreements executed as part of the spin-off, or Atleos may fail to have necessary systems and services in place when Voyix is no longer obligated to provide services.
• 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.
• Voyix's indemnification for certain liabilities may not be sufficient to insure Atleos against the full amount, or Voyix's ability to satisfy its obligation may be impaired.
• Atleos's assumption of and indemnification for certain liabilities to Voyix could result in significant payments and adversely impact financial results.
• If the distribution of Atleos shares does not qualify as a generally tax-free reorganization, Voyix and stockholders could incur significant U.S. federal income tax liability, and Atleos could be required to indemnify Voyix for material taxes.
• Restrictions under the tax matters agreement could limit Atleos from taking certain actions after the distribution that could adversely impact the intended U.S. federal income tax treatment.
• The spin-off and related internal restructuring transactions may expose Atleos to potential liabilities arising out of state and federal fraudulent conveyance laws and legal dividend requirements.
• Certain executive officers and directors may have actual or potential conflicts of interest because of their previous positions at NCR.
• Atleos's stock price may fluctuate significantly due to various factors, including earnings, market conditions, and analyst estimates.
• Any sales of substantial amounts of shares of Atleos common stock in the public market, or the perception of such sales, may cause the market price to decline.
• The company cannot guarantee the timing, amount, or payment of dividends on its common stock.
• Percentage of ownership in Atleos may be diluted in the future due to equity issuances.
• The share repurchase program may not continue or enhance long-term stockholder value, and could diminish cash reserves.
• Certain provisions in Atleos's charter and bylaws, and of Maryland law, may prevent or delay an acquisition of Atleos, which could decrease the trading price of the common stock.
• Atleos's bylaws contain an exclusive forum provision that could limit a stockholder's ability to bring a claim in a judicial forum they believe is favorable.
• The company may be subject to actions or proposals from stockholders that do not align with its business strategies or the interests of other stockholders.

Future Outlook

The company expects to be a cash-generative business, focusing on delivering ATMaaS to its large customer base and leveraging new ATM transaction types, including digital currency solutions, to drive market growth. It plans to continue shifting to a highly recurring revenue model to drive stable cash flow and improve execution for solid returns and enhanced stockholder value. Separation-related costs are expected to continue through at least fiscal year 2026 but will be lower compared to 2024 and 2025. The company anticipates continued significant research and development expenditures to provide innovative products and services and maintain its competitive position, including evaluating emerging technologies like machine learning and generative AI. Management believes current cash balances, operating activities, borrowing capacity, and access to capital markets provide adequate liquidity for current and long-term cash requirements, capital expenditures, and investment opportunities. The company expects to contribute $48 million to its U.S. pension plan and $4 million to international pension plans in 2026. The definitive merger agreement with The Brinks Company is expected to close in the first quarter of 2027, subject to customary closing conditions and shareholder approvals.

Management Comments

• "We are continuing our transition to software-led solutions."
• "We intend to continue pursuing opportunities to win new customers, expand our footprint and drive more transactions and foot traffic for our customers."
• "We also plan to continue to improve our execution to drive solid returns and to transform our business to enhance value for all stockholders."
• "Management believes that our cash balances and funds provided by operating activities, along with our borrowing capacity under the senior secured credit facility and access to capital markets, taken as a whole, provide (i) adequate liquidity to meet all of our current and long-term (i.e., beyond December 31, 2026) material cash requirements when due, including third-party debt, (ii) adequate liquidity to fund capital expenditures and (iii) flexibility to meet investment opportunities that may arise."
• "We expect to utilize our cash flows to continue to invest in our business, growth strategies, people and the communities we operate in as well as to repay our indebtedness over time."

Industry Context

StockSavvy.ai notes that NCR Atleos operates in a dynamic financial technology landscape, characterized by the secular trend of self-directed banking and increasing adoption of ATM and ITM technology. The company's focus on "ATM as a Service" aligns with broader industry shifts towards outsourced, recurring revenue models, which can offer financial institutions cost efficiencies and enhanced customer experiences. The decline in Network segment revenue due to changing U.S. immigration policies and Bitcoin transaction volumes highlights the sensitivity of certain business lines to external socio-economic and regulatory factors, a common challenge for companies in the payments sector. The announced merger with The Brinks Company signifies a potential consolidation trend in the cash logistics and ATM services industry, aiming to create a more comprehensive offering.

Comparison to Industry Standards

• The company states its Allpoint network is "the largest retail surcharge-free independent network of ATMs in the U.S.", indicating a strong competitive position in this specific niche.
• The company's strategic shift to a software-led, as-a-service model aligns with broader industry trends observed in competitors like Diebold Nixdorf and Hyosung TNS, who are also adapting to evolving digital banking demands and seeking higher recurring revenue streams.
• The filing does not provide explicit comparisons of its financial metrics (e.g., revenue growth, EBITDA margins) against specific named competitors such as Fiserv, Euronet, or Diebold Nixdorf, making a direct quantitative assessment against industry standards challenging based solely on this document.

Management Changes

Corporate Governance

Legal Proceedings

• The company shares liability with Voyix for certain investigatory and remedial activities and related litigation at facilities formerly owned or operated by Voyix (Shared Environmental Matters).
• The company is responsible for 50% of these costs if Voyix's annual costs exceed $15 million, net of insurance proceeds.
• One significant Shared Environmental Matter is the Allied Paper, Inc./Portage Creek/Kalamazoo River Superfund Site remediation.
• A court ruled on September 14, 2024, that the Kalamazoo River is a 'future site' under the Cost Sharing Agreement between Voyix and B.A.T. Industries p.l.c. (BAT), with the case still pending regarding BAT's counterclaims.
• Voyix also has indemnity or reimbursement claims against AT&T Corp and Nokia under a 1996 Divestiture Agreement.
• As of December 31, 2025, the company accrued $26 million related to the Shared Environmental Matters.
• In the Hoak, et al. v. Plan Administrator of the Plans of NCR Corporation class action lawsuit, the appellate court affirmed a trial court judgment on August 26, 2025, ordering Voyix to calculate benefits based on specific discount rates.
• Voyix's petition for rehearing en banc was denied on December 3, 2025, and the case will be remanded to the trial court for further proceedings.
• As of December 31, 2025, the company accrued $22 million, representing its 50% obligation to indemnify Voyix for any award in the Hoak case.

Related Party Transactions

• Prior to the October 16, 2023 separation, the company participated in NCR's centralized treasury and cash management programs, and certain corporate overhead and shared costs were allocated from NCR.
• All charges and allocations for facilities, functions, and services performed by NCR were deemed settled in cash.
• Manufacturing services provided to Voyix were completed in the fourth quarter of 2024.
• All services provided under the Transition Services Agreement with Voyix were terminated as of October 16, 2025.
• The company has indemnification obligations to Voyix for retained environmental remediation obligations and shared legal matters.
• Voyix has agreed to indemnify Atleos for certain liabilities, but there is no assurance it will be sufficient or that Voyix's ability to satisfy its obligations will not be impaired.
• The company is restricted from certain actions post-spin-off to preserve tax-free treatment for Voyix.
• Certain executive officers and directors may have actual or potential conflicts of interest due to their previous positions at NCR.

Stakeholder Impact

• Shareholders: Potential for increased value from the merger with The Brinks Company ($30.00 cash + 0.1574 Brinks shares per Atleos share). The share repurchase program indicates management's commitment to returning capital. However, stock price fluctuations and potential dilution from future equity issuances remain risks.
• Employees: Promotion opportunities and new hires (e.g., Andrew Wamser, Andrea Burson, Traci Hornfeck). Investment in development programs, global well-being, and an AI-enabled workforce. Executive severance plans provide protection.
• Customers: Continued investment in self-directed banking solutions, ATMaaS, and the Allpoint network aims to provide more robust, efficient, and convenient banking experiences. Expansion of product development to include cashless card access and Bitcoin capabilities.
• Suppliers: The company expects high-quality products and services and adherence to its Supplier Code of Conduct. There is a risk of disruption if third-party suppliers fail to meet needs.
• Creditors: The company's significant debt levels ($2,798 million) and restrictive covenants in debt agreements are important considerations. However, management believes liquidity is adequate to meet obligations.

Next Steps

• Continue the transition to software-led solutions and the ATM as a Service model.
• Pursue opportunities to win new customers and expand the ATM footprint with retailers and banks.
• Invest in the FinTech channel to expand relationships with fintechs and card issuers.
• Grow the Allpoint network by bringing in more financial institutions and retailers.
• Expand the total addressable market through product development, including cashless card access and Bitcoin capabilities.
• Continue international expansion, focusing on high cash jurisdictions.
• Pursue selective mergers and acquisitions to complement and accelerate organic growth.
• Continue to spend and potentially increase capital expenditures to support the shift to ATM as a Service.
• Remediate any future material weaknesses in internal controls over financial reporting.
• Resolve certain tax matters in foreign jurisdictions during 2026.
• Contribute $48 million to the U.S. pension plan and $4 million to international pension plans in 2026.
• The Hoak legal case will be remanded to the trial court for further proceedings.
• Complete the merger with The Brinks Company, expected in Q1 2027.

Key Dates

Recommendation

The announced merger with The Brinks Company at a fixed cash and stock consideration provides a clear and immediate upside for Atleos shareholders, making it an attractive acquisition target. The company's strong financial performance in 2025, with a doubling of net income and solid Adjusted EBITDA growth, demonstrates operational strength and successful execution of its ATMaaS strategy. While some segments face headwinds, the overall trajectory and the strategic acquisition offer a compelling investment case.

Keywords

Financial Technology, Self-Service Banking, ATM as a Service, ATMs, ITMs, Allpoint Network, Bitcoin, Financial Institutions, Retailers, Managed Services, Fintech, Corporate Governance, SEC Filing, 10-K, NCR Atleos, NATL, The Brinks Company, Merger