VeriFone Swings to Profit

VeriFone Systems Inc. swung to a third-quarter profit as higher revenue in North America offset declines in its other segments, driving the electronic-payments-equipment company into its first half-billion-dollar revenue quarter.

The San Jose, Calif., company adjusted its projections for the year that ends in October. It now expects profit of $1.82 to $1.83 a share and revenue between $1.997 billion and $2 billion, compared with its earlier view of $1.81 to $1.84 a share in profit with $1.995 billion to $2 billion in revenue.

Analysts surveyed by Thomson Reuters had projected profit of $1.85 a share with $2 billion in sales.

Shares, down nearly 17% this year, fell nearly 6% to $29.31 in late trading.

In the most recent period, net revenue in its North America business, its largest segment, rose nearly 61%. Revenue in its Europe, Middle East, Africa segment declined 9%, while Latin America reported a 17% decline and Asia-Pacific was down roughly 18%. The declines were largely tied to currency fluctuations, the company said.

Last year, VeriFone made 72% of its revenue abroad.

Over all, VeriFone reported a profit of $9.5 million, or eight cents a share, compared with a year-earlier loss of $29 million, or 26 cents a share. Excluding stock-based compensation and other items, profit rose to 47 cents from 40 cents a year earlier.

Net revenue rose 7% to $509.9 million. Adjusting for currency fluctuation, revenue rose 18%.

VeriFone had projected 44 cents to 46 cents and revenue of $495 million to $500 million.

Gross margin improved to 40.5% from 38.4% a year earlier.

Write to Maria Armental at [e-mail]

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(END) Dow Jones Newswires

September 03, 2015 17:15 ET (21:15 GMT)

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