NCR positive on first quarter

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NCR Corporation (NYSE: NCR) reported financial results today for the three months ended March 31, 2017.

First quarter highlights include:

• Revenue of $1.48 billion, up 2% as reported and up 9% excluding FX and the IPS divestiture
• Software revenue up 8%, software license growth of 29% and cloud growth of 6%; Net ACV of $18 million in the quarter, up 29%
• GAAP gross margin rate expanded 160 basis points to 27.9%; Non-GAAP gross margin rate expanded 210 basis points constant currency to 29.2%
• GAAP diluted EPS of $(0.14), down from $0.16 in the prior year due to impact of the deemed dividend from the Q1 Blackstone transaction; Non-GAAP diluted EPS of $0.56, up from $0.38 in the prior year
• $350 million of share repurchases completed; New $300 million share repurchase authorization approved
• 2017 GAAP diluted EPS adjusted due to impact of the Q1 Blackstone transaction; 2017 Revenue and Non-GAAP diluted EPS guidance raised; Maintaining our 2017 cash flow guidance

“We are off to a strong start in 2017, with results that exceeded expectations and position us well to accomplish our full year goals,” said Chairman and CEO Bill Nuti. “We generated solid revenue growth and gross margin expansion across each of our business segments driven by our leading portfolio of global omni-channel and channel transformation solutions. In Software, we experienced continued strong demand, including for our cloud solutions while also benefiting from improved efficiency and scale. Our Services business expanded its recurring and implementation revenues and we further advanced our business process improvement initiatives. Store transformation momentum drove further growth in self-checkout revenue in our Hardware business and we are gaining scale as we introduce new products across key markets. Looking ahead, we will remain a global leader in omni-channel software, channel transformation and digital enablement and our solutions support customers of all sizes as they effectively transform their businesses and compete in the digital world. Our focus remains centered on strong execution, innovation, and driving customer success.”

In this release, we use certain performance metrics as well as certain non-GAAP measures, including presenting certain measures on a constant currency and adjusted constant currency basis. The performance metrics include net annual contract value (or Net ACV) and the non-GAAP measures include free cash flow and others with the words “non-GAAP,” “adjusted,” or “constant currency” in their titles. The performance metrics are listed and described, and the non-GAAP measures are listed, described and reconciled to their most directly comparable GAAP measures, under the heading “Performance Metrics and Non-GAAP Financial Measures” later in this release.