NCR Voyix Corporation (VYX) Earnings Call Transcript & Summary

Good morning, and welcome, everyone, to the 2021 Stephens Annual Investment Conference. Before we start, I wanted to provide investors with my e-mail address, [email protected]. Should you have any questions, we'll try to get to them throughout the session. But it's my pleasure this morning to introduce Tim Oliver, who's the CFO of NCR. For those not familiar with NCR, NCR has been around for nearly 150 years, dating back to the invention of the cash register. But today, it's much, much more. It's one of the leading manufacturers of the ATM as well as providers of solutions and services to the banks as well as a provider of software and payment solutions to the retail and hospitality industry and a big player in the digital banking industry as well, which we will get to. And I think that's one aspect to the story that floats for the radar there. So again, it's my pleasure this morning to introduce CFO, Tim Oliver, who's been with the company for a couple of years. And I appreciate everybody joining.

And just to kick things off, for those that are new or revisiting the story, Tim, could you talk about some of the investments and changes that have -- to the go-to-market strategy over the past couple of years?

Yes. And thanks, Chuck. As you described, we were and are still perceived by many to be a hardware company, right? And too much of our revenue in the past has generated from onetime hardware sales. And I think the most important thing that Mike Hayford brought to this company was the desire to transform that revenue. And when we get to the end of 2021, we're going to look back at revenue in 2018 or 2019 and see that the company's revenue is relatively similar, right? We -- adding Cardtronics and pro forming out, we're going to be relatively similar where we were some 3 years ago. But the composition of that revenue is entirely different. And now only 20% of our revenue comes from hard -- onetime hardware sales. So 80% comes from software and services and solution sales that are more recurring and far more valuable. The -- and 60% of our revenue is recurring. And so that required us to transform our relationship with our customer, required us to make the customers like us better. We had -- let's call it, customer satisfaction wasn't where it needed to be. And we needed to change the way we sell. I think the hardest thing we've had to do is not so much to change our product set, but change the way we sell our product set and convert our selling organization from a hardware organization to one that sells solutions. The products are good now. They needed to be invested in. Some of them were long in the tooth. We allowed some folks into some spaces. We had some pretty dominant market shares in because we just didn't take good care of our customers, and our product got aged. When Mike arrived in 2018, we've made -- as you've seen in our CapEx spending, we've made significant investments in our hospitality suite and our retail product set and our digital banking product set primarily and in payments. And taken all together, those are the spaces that are driving our higher profitability and better growth currently and will drive most of our growth in the future.

Got it. So you alluded to it a little bit in terms of investing in the product set. But starting with hospitality, you hear a lot about some of the upstart players in the restaurant industry. Yet, you're still a major player in that industry and you've invested in your product set over the past couple of years. Could you talk a little about those investments and how you position the business to meet some of the changes in the demand environment that have come out post COVID?

Yes. That was a product set where we had huge market share, right? The Aloha product was the leader in the U.S. and in other parts of the world. And by underinvesting in that product, by not moving quickly enough to the cloud, by not listening to our customers, by selling the wrong way, by selling onetime and walking away, dropping devices with resident firmware and software and completing the sale moving on, we allowed others into the space. And I don't -- they're not really upstarts anymore. They're legit players, and they do a good job. And they're pushing us to get better. So we -- about 20% to 25% of our revenue in hospitality comes from the SMB space, which is where most of those competitors have emerged. And they sell payments first. Their strategy is a payments-led strategy. Ours never was. Ours is a functionality and software capability sale, and that was falling on deaf ears. So we've shifted the strategy on that cloud-based SMB product to be very much a payments-led strategy, with attached payments all the time and giving our customers a choice as to whether they use the payment stream to offset the cost of our as a service product set or whether we return it to them and they pay us differently. So I think that's a difference from Toast and some of the other folks. On the enterprise side, we've always been a reasonably good customer -- a good partner with our customers on the enterprise side. They don't always need us for a full suite like the SMB side does. So we need to craft our offering to make sure when a McDonald's or Starbucks, the others, Whole Foods, needs our help that we can craft pieces of the Aloha suite that they might need. The Aloha Essentials package takes the very robust Aloha suite, distill it down to a few very important capabilities and sells them as a unit. And so you hear us talk about Aloha Essentials. It takes that product that was really robust and really mostly appropriate for those who had thousands of restaurants. It makes it more appropriate to those who have 30, 50, 100 or 300 restaurants. So big investments, good product set now. I'd say it's better. It's not perfect. We'll continue to invest in it. It's competitive again. And we're winning again, and we'll have to keep investing to keep up with those folks that you talked about.

All right. So in terms of those investments, I know most of us listening has known some curbside pick up over the past couple of years, paid via QR code at a table. Could you talk about some of the changes that have -- how the industry has evolved over the past couple of years in terms of shift towards omnichannel payments?

Yes. So first of all, and I'll talk in the SMB space mostly, because that's where that's predominant. And you could extend that SMB up into say the 30- to 50-restaurant chain. But the labor problems -- labor is always a problem even before we couldn't find people to work. There's too many people working in restaurants, and it was too expensive and it's too hard to schedule. And we allow now through our technology to tie the consumer directly to the kitchen. It takes all that noise out. It takes a lot of labor out, and it makes it much easier for our restaurants to serve their customers. We -- when you use QR codes or whatever you might go about getting the menu onto your phone, our menus are live menus. You can click on that menu and order. The order goes directly to the kitchen. You can go direct to the bar. We can split the tickets to 2 different parts of the organization. And importantly, you can pay from table. So there really is very little need to interact with anybody if you don't want to when you go to one of our restaurants. You can simply sit down and order and have a runner drop your food off and leave when you're all done. And believe it or not, some people actually prefer that. We've seen the customers of restaurants think that that's -- they like that. They'd rather didn't interact with a waiter, where the human interaction can cause the order to come out wrong, to interact direct with the kitchen. So that mattered a lot. The other is we're not selling the -- you asked about payments. When you buy Aloha Silver from us now, which is our cloud-based SMB product, you must buy Payments. it's attached. So there's no -- we don't sell it any other way. A year ago, you can make a choice. As of now, you can't. And we're going and back selling to all those customers who don't use, who currently have silver, but don't use our payment system. We're going back and taking those payment streams back as well.

Got it. Okay. Let me move on to retail. What types of customers do you serve in the retail segment? And how do your solutions -- again, how do your solutions address changes in demand environment in the industry?

Yes. So we're about 70% big box. We're about 20% department and specialty, so think drug stores. And we're about 10% convenience and fuel. So very heavily weighted to grocery and big box, but some nice emerging demand and particularly when you think about the Cardtronics overlap, I think, and that other 30% that's in department and convenience fuel. So that's our customer set. The pending upgrade cycle that's going to absolutely have to take place in retail in terms of their POS is driving not just self-checkout sales, which have been really good, but it's also driving a software upgrade that causes the store to an essence, either use what we call Emerald to run their stores, their new ERP system, extend the POS system back through the operations of the organization and to help them take even more labor out of their stores. Self-checkout is good, software residence self-checkout is even more powerful. So we're excited about that upgrade cycle. It's starting to happen. And we're starting to see real traction with our Emerald product set, particularly traction. And the grocery sector has been great. And in the convenience and fuel sector, really terrific uptake. So a complicated sale in convenience and fuel. When you have to tie the fuel pumps in and all the loyalty programs, it takes a difficult sale. But I mean even tie in, for instance, the showers, right? I know you probably stopped at a lot of truck stops and use their shower capabilities. But lots of people do. We actually run, if you stop at a [ Loves ] and take a shower, you're using our software to schedule that shower.

So on that topic, not the truck stop topic, but you build a software in terms of digitization and software upgrades. You build a platform and are migrating customers from legacy software to your new platform. What are some of the drivers for the upgrade in terms of unit economics? And how does it change as...

Yes, yes, yes. First, in the absent platform, we don't have the ability to upsell. You're selling every product by itself, and you're competing with anybody else who might be in that space or homegrown solutions that the customer has. So the platform is key. Getting the platform in space, virtualizing the edge, tying that to the platform and then grabbing that position inside of the retailer is important. Once you have that, of the 13 or 14 capabilities we either have or aspire to have in short order, a lot of these customers are buying 2 or 3 or 4 of those products from us. And so if you take my ARPU at an existing customer who's not on the platform, I put the platform in place, immediately my ARPU goes up by at least 50% and usually doubles, simply because I'm now running more of his store. He pays me for that. Beyond that, I now have a whole bunch of capabilities that I can cross-sell, upsell and drive share of wallet well beyond. It can take my ARPU up by 4x or more.

Got it. And you alluded to self-checkout. And I think anybody who's been to a grocery store or a big box has seen more lanes being added. Where are we in terms of that adoption? I know the supply chain, which we'll get to in a little bit, has been a bit of a hiccup. But could you talk about that shift towards self-checkout and where we are in terms of the adoption curve?

Yes. I really look forward to the conversation on supply chain. The self-checkout has -- the adoption rate in the U.S. is pretty strong, right, already? And so penetration is high, but there's still more to go. And we're seeing more opportunity set in smaller store footprint, so the convenience and fuel, for instance. I don't know if you go to like a quick trip or something on a morning on the way to work, but you go to get a coffee and there's probably 7 or 8 people working the cash out at those peak hours. It's incredibly difficult to stack, because they only need people for those 2 or 3 hours in the morning. And by the way, it's early, and that's -- it doesn't work for everybody. So we're moving to self-checkout with a lot of our convenient fuel customers and putting in 4 machines with 1 person staffing the store, rather than 8 counters with 8 people is working really, really well. So just as self-checkout moves, it becomes more mainstream at your targets in your Walmarts and your grocery stores. They're becoming much more mainstream in smaller footprint. It's also true that many grocers who held out and said, "Look, our customers want a higher level of service. Our customers don't like self-checkout." Self-checkout, the loss is too high, right? The shrinkage is too high. They're all now converting. I talked to the CFO of a major grocer in Europe, in fact, the largest, who said, "I didn't buy into self-checkout at all. I thought it was for low-end grocers and not for us." He said, "I was wrong. I was wrong. We need your help. We need to get into self-checkout because I can't find labor. My customers actually like the experience. And importantly, your software has gotten good enough that you can tell whether or not somebody is old enough to buy alcohol through a facial recognition system. You can tell whether somebody put batteries on the machine and put a banana sticker on there and catch them. The visioning systems catch all that." So shrinkage is down. The number of times that the folks who do work at the self-check that have to interact with the customer is down, and customers are starting to like self-checkout a lot more. So I think the growth rate there is going to be globally in the low teens or 10 to low teens percentage points. I think some of that growth is in China and Russia, where we won't participate. It's just not -- it's not for us, and it's not where we can be profitable. But I still think this is a business that grows in the high single digits for the longer haul and outpaces -- we will outpace the growth in the markets that we serve.

Got you. Okay. I want to shift gears to the banking segment and specifically Cardtronics. You announced the acquisition of Cardtronics earlier in the year. It came as a bit of a surprise to many. But I was wondering if you could just -- as a starting point, could you walk us through the strategic rationale behind that transaction as well as how that plays into your legacy banking segment and demand for ATM as a Service solutions?

Yes. So we -- and you're right, it was surprised because we just had our December 3rd Investor Day last year. We just come off describing our strategy that had nothing to do with Cardtronics. And then 2 weeks later, we're engaged in a transaction or potential transaction. We didn't see it coming either. So as well as an asset that we thought about for a long time, we didn't know it's available until somebody else put in a little bit lowball offer. So -- and then we tried to explain to our investors right out of the gate that it was not an ATM business, and they said, "Really, because it has ATM in the ticker." So we had a hill decline. The -- what Cardtronics does for us, first, it brings a terrific network with it. And so it takes our payments business to a whole new level. When you put the Allpoint network between our payments business and our number of endpoints or transaction endpoints, which is probably the largest in the world when you include POS and ATMs and financial kiosks, it's a really unique set of tools that link together and drive revenue streams that others can't go harvest. The other thing it does, it derisks our ATM hardware business. Mike ask our ATM guys all the time, "When is the last day that I will sell an ATM? I don't want to sell ATMs anymore." It's like I don't sell cash registers, I don't want to sell ATM. I want to sell the capability to conduct a physical transaction to anybody who wants to conduct it. I want to get paid a fair price to conduct that transaction. And I want to be able to transact both digitally and physically, if that's what the customer wants to do. I'll even convert it in one direction or the other. So that's what the Cardtronics business allows us to do. It gives us a huge footprint of endpoints to a network that can grow, and it can be the primary place by which our financial customers and our retail customers deal with their physical transactions. So it speeds forward our ATM as a Service strategy. There was already a strategy, what Cardtronics is already doing. And they're doing it for 280,000 machines around the world. They bring that model to us, and it's already started to pay dividends.

Got it. So Cardtronics had a smaller presence in Europe and South Africa. You have a more global presence. Do you see opportunity to shift that managed service ATM outsourcing business into -- that they had in the U.S. into the European footprint? And can you talk about how the combination of the 2 companies really builds more of a more -- a broader service offering that improves, enhances your go-to-market to banks?

And it brings capabilities together, we otherwise couldn't have brought together, right? So we're really good at manufacturing, designing and manufacturing great machines, done it for a long time, as you said, almost 150 years. They're really good at selling a solutions model and then maintaining pricing and then maintaining machines against a solutions model. We bring those together. It works really well. Outside of the U.S., they're big in the Crown countries. So Canada -- U.K. is big for them. Canada is big. Australia is decent, South Africa, and none of those countries, as you know, are open yet. I mean where they were and then they're closed again, I guess, because of Omnitron (sic) [ Omicron ] or whatever we're calling it. So that model can move to other parts of the world. I'm not even sure that it's Western Europe, so much as -- or Crown country so much as the rest of Western Europe, certainly Eastern Europe. We've got a -- we're in 130 countries. They're in 7. So there's a whole lot of space that we can go fill. India is a great example where we have a bigger presence and where I think that model already plays really well in India. So Australia, it plays well in Australia. So I'm hopeful that we'll be able to take that model elsewhere. I think the big opportunities for us likely are in North America in the short run. I'm hopeful we'll get a ATM as a service contract or a deal that's big and meaningful with the bank that you know the name of in the not-too-distant future. And we get a legitimate credible organization to outsource their ATM fleet to us. We're working hard on that. That will then make people understand this model is going to work.

Got it. So you touched on Allpoint a couple of minutes ago, which, for those not familiar with it, is the largest surcharge-free ATM network in the U.S. Could we dive into that a little bit and talk about maybe some of the synergies between Allpoint and your retail customer base? And also, I think one of the more underrated and interesting things about Allpoint and Cardtronics that talked about a couple of years ago is its value proposition, fintechs, which are regarded as 100% digital, whereas in reality, the customers -- many of their customers still need access to cash, which is where Allpoint has come in and work with some of those companies. So I think that will be helpful.

Yes. So you're going to hear more on that point. But you're exactly right. Our kiosks and retailers or other places can be used to distribute cash to folks who use online gaming sites, where they have other -- they have crypto wallets. They have other assets that they can't convert to cash easily, we can become the device that allows them to do that. And having a network of 280,000 machines that are in places where people happen to be quite frequently, convenience stores, drug stores, grocery stores, will allow them to have access to that cash. You'll hear a lot about products that we're going to roll out in 2022 around exactly what you just described, making physical transactions available to people who have used Chime, for instance. Chime is a very big customer, the fastest-growing customer we have in the company right now, because they're onboard with the network. We are their ATM fleet. And in their app, you can find our ATMs by using the app, and it directs you to nearest ATM. That's -- so we enable them to be physical when they otherwise wouldn't be. And to your point, yes, people are transacting more electronically, but there are always reasons people need to do a visible transaction that there's still 1/3 of all transactions not in New York City, but in other places, 1/3 of transactions are still physical.

Great. So I think this -- I have a feeling this will be a topic as well at the Analyst Day, but can you talk about how Cardtronics...

Yes. I think we'll extend that too, Chuck -- sorry to interrupt. We're going to extend that too to talk about the retailer, core to the retailer. I think the most exciting thing is closing the cash loop inside the retailer. So I -- if you think about the ATM or the financial kiosk in the corner, they both distributes and takes cash in, right, so recycler. And then can also do crypto transaction, do other things the digital and physical transactions. And I have a POS device, 10 yards away, that people taking money out and putting it into the POS device to go pay for whatever they just bought at the grocery store. That cash never has to leave the store. And so if I have cassette inside of my safe -- inside of my smart safe, that matched the cassettes that are inside my ATM, that matched cassettes they are on my POS device. All of a sudden now, I've just reduced the number of truck rolls for cash by a factor of 5 or 6 because I can recycle that cash inside the store and, in theory, not have to replenish it. So now we're still -- we're hopeful we can find ways for cash to leave the store more to close that cycle. But -- because right now, we take in more cash than we would distribute. But I think that's a really exciting opportunity set for us, and some of our retailers are really excited about it.

Got it. Great. Again, you touched on crypto. You announced the acquisition of a company called LibertyX earlier in the year. Just the obligatory crypto question, what role can that play in your business? And how does LibertyX fit into that puzzle?

Yes. So that was not closed yet. We're still working through the some regulators in New York we're waiting on. Once they get that done, we expect it soon, we'll get that closed. And when we talk in December 9th about our future as a company, I will presume that LibertyX is part of it because I don't think there's any reason it won't close. It's just a timing issue. We want to make sure that however our customers, our customers' customers want to transact, that they can do so using our devices. And we think that the ability to take digital assets and convert those digital assets to physical currency, and that perhaps even convert it back yet again is going to be important going forward. And so we have to have the capability to allow those transactions take place on our machines. And whether it's crypto or it's, as I said, gaming wallets or it's other currencies, it's loyalty programs, however people want to use those assets, we need to allow them to do so on our devices. So LibertyX is not -- was not the typical crypto company, right? They were trying to enable devices, ATMs to transact in crypto. And we're thrilled with the penetration they've got this far. They're only a bitcoin company right now. There are only about 2,800 machines. But you can imagine with a footprint of 240,000, we can definitely increase the size of that footprint. We can definitely use our scale to help us take on other currencies and just bitcoin and give them the coding heft that they need to start to grow more rapidly in terms of capability set. And ultimately, this could be a really interesting growth story for us. But it's not different than other digital transactions, right? It's for us. We're not betting on one cryptocurrency or another. We just know that our customers are likely to want to have that capability resident in their retail establishment or in their financial institution, and we want to be there to help them.

Got it. And just to round out our conversation about ATMs and Cardtronics, can you talk about how Cardtronics contributes to your 80/60/20 strategy?

Yes. It helped a lot. In fact, you're likely to hear us claim victory on 80/60/20 when we get to December 9 and hang out some new goals because we will be through the 80 metric. They don't sell any hardware. And in fact, most of the hardware that they put in place, they bought from us. So they don't have any hardware. So that they pushed that metric, north of 80. On the recurring revenue side, most of what they do is recurring in nature, transaction-driven, already in place. We call that recurring. That's not the way we typically sold at NCR. We've gotten well down the path to be more recurring. They give us a huge bump up in terms of total percentage of our revenue base. So nearly all of their revenue is recurring, and their margin rates are higher than us. Because of what they do, their revenue streams are more valuable and their margin rates are higher, and they're posting historically high margins currently. So that increases our margin rate. And I think last quarter, we were in the mid-18%, 18.5%, something like that, headed towards 19%, which 20% is not that far away. So when we gave that goal of 20%, I thought we'd get there over the next 4, 5 years through good old-fashioned productivity and a continued mix shift at the legacy NCR. They gave us a boost and get us close. We'll continue to drive productivity and other things at the legacy NCR business. I'm not sure how much higher margin rates can go at Cardtronics, they're pretty high. But I feel very good about margin dollars increasing nicely.

Got it. So switching gears a little bit. Within the banking segment is the digital banking business that competes with Q2 and [indiscernible] of the world. It's acquired several years ago and it's been a bit of a turnaround story over the past couple of years. Could you talk about the repositioning of that business as well as the demand environment and your outlook over the next couple of years?

Yes. Not too different from the story I talked about earlier about the product that need to be reinvested into, right? Our digital banking business was challenged. We'd underinvested in DI, and we needed to fix that product. We've now acquired D3. D3 was acquired about a year before I got here. It's performing very nicely against the original expectations of that model. We've had some nice wins on D3 that extends into the medium-sized or larger financial institutions, our digital banking capability. While that's going on, we fixed DI. And DI is now winning again and winning more back its rightful share on the smaller end of the customer set, doing a great job winning currently and offsetting losses that occurred in 2018 and 2019. So our win rate is back to where it needs to be. We also bought a company called Terafina. Terafina is an account opening application, and it allows you to open a variety of different accounts through your mobile device very easily. That was not a capability we had. We use partners to get there. And usually, our customers would pick that partner. Now Terafina the leading -- the leader in this capability, they're actually winning deals and pulling digital banking with them. They're that good at what they do. They're giving us access to new digital banking clients because we're able to sell our new capability and account opening. So that transaction has gone exceptionally well. The team that came with Terafina is really great. They fit in terrific with our culture. So I feel very good about that acquisition. I think the D3 acquisition is doing just what it needed to do, and DI is back and fighting a fair fight.

So D3 gives you some -- gave you some entry into the larger bank market. But what is the sweet spot of that DI business? What's the typical profile of the bank or financial institution you serve?

I'll get to the regional or super regional level, right? I mean once you get above that, I think that's when that plays. If you're thinking about more local banks, it's the DI product, making credit unions, it's the DI product. But D3 really is that regional and super regional bank customer.

Got it. Okay. And just the brand things, you've had a [indiscernible] in financials, can we talk about -- you mentioned M&A throughout the conversation. Can we talk about the capital allocation strategy, including your path to deleveraging post M&A Cardtronics? And how you think about M&A in the interim?

Yes. So we did the Cardtronics transaction, we said we're not comfortable being at a 4.5x leverage ratio. And we want to get back to 3.5x, and we do that as fast as we can because the CFO and CEO of this company are more comfortable at 3.5x. I think some of our investors and debt holders are more comfortable at 3x or even 2.5x. So our #1 objective is to make sure we make good on our commitment to our new debt holders and get delevered down to 3.5x. I think we can be there by the midpoint of next year. When we're able to do that, I think now we've got our -- what I'll call, our strategic flexibility back. So I've got our business units chomping at the bit to get more aggressive on let's call external growth. We still are looking at transactions. You can't time these things, and you can never take yourself out of the flow of deals, right? Because otherwise, it's incredibly hard to get it started again. So we're active, but I'd say that our hurdle rates are a little higher than otherwise would be. I'd like to get those guys, their strategic flexibility back to be a little more aggressive in the way that they go and buy both capability and distribution. They -- we also have a lot of internal growth ideas. I think organic growth ideas typically are less expensive. They should be less expensive than acquisitions. They should pay for themselves more quickly. I like them. And we're getting more focused in our -- the way that we apply CapEx. I'd like to have more of it to drive even harder. We used to spread our CapEx across the businesses kind of in a very broad perspective, which didn't pull functionality forward to everything we move along at the same pace. Now we're picking our spots, getting functionality out and moving to the next one, and sequencing things better, getting more speed through our capital development project. So once I've invested, I'm delevered, I'm now at my growth ideas that are accretive, are now funded. After that, I think we can start buying back our stock again. And I think we should do that. Probably start with the convertibles we still have out. We have about $250 million -- $275 million of convertibles that are still out there. They're very expensive. And it's good for both the holders and shareholders to buy those back. I'd attack those first, if I could. And then I'd likely have to consider. If we're doing all that and our share count is coming down modestly, we probably should consider a dividend.

Got it. And you talk a little about that product road map in terms of areas of focus for, to whether organic or M&A?

Yes, they always make buy decisions. So this -- I don't think there's any mystery as to what we -- what products we need to offer -- what capabilities we need to offer to our customers, right? We can see them emerging. Traditionally here, we've put people in business, wait until they're worth $100 million and then buy back capability. We could have developed ourselves with their help much less expensively. I hate buying Terafina and paying too much money. I hate buying some of the things we've had to buy along the way. And I hate that some of the folks we put in business are valued at multiples considerably higher than ours. So we have to get better at identifying technology early, and emerging technology early and investing it in ourselves. And so these are new functions, new capability that will sit on the platform. They were likely currently procuring from others. So we attach it into the platform, and we collect a small fee as their relationship provider. I'd like to start to own more of that ourselves and be buying less. But -- so on the buy side, on the acquisition side, if we have -- if speed is worth it, if the speed to market is worth the extra investment to get the product onboard and grow more quickly, we'll do that. We've also been going out and buying smallish, what I'll call, distributors, agents, who sell both into retailers and primarily into hospitality because we don't think they're telling our story well. We've reworked our internal selling organization. It's sometimes hard to rework the way those who have sold for you on the past as agents to rework how they sell. So buying them sometimes at a reasonable multiple of folding them in is a good path. We've done several of those over last year. So I hope we continue to do that.

Got it. So I have to ask a supply chain question, but I'm going to approach it slightly different angle. So you talked about the impact on your business. But as a competitor, do you feel like -- do you feel as though your long-term relationships with some of the vendors and manufacturers provide you with any relative advantage in navigating supply chain-related headwinds?

Yes. So I said that to our operating guys, Adrian Button, who runs our manufacturing operations and service operations. I told him, you should be able to go lever up Texas instruments and tell them how important you are. He goes, "Are you kidding me? Do you think I'm important to Texas Instruments?" So the answer is, no, I don't think our scale matters that much to our vendors. It does matter to our customers. So we've been able to insulate our customers by investing in a little bit of inventory, by working over time, by spending some premium dollars on both labor and transportation, including our customers in the conversation to insulate them from -- for the most part from this pandemic, the pandemic-impacted supply chain. I don't think we've had a customer who we've let down, who had a store to open or an installation take place that was necessary, that was critical. I don't think we've let anybody down. Never say never, right? There's probably somebody out there, but I've not heard of them. And our goal is to make sure that, that doesn't happen. So we're forward staging machines. We're allocating machines. We've recertified parts in our machines, some over 1,000 new parts have been certified over 300 new vendors over this period of time to help us keep product flowing. And our customers are happy. The weird thing is our customer SAT scores, we call it NPS, were not very good coming into the pandemic. In the 2 years since, we've improved dramatically both in 2020 and into 2021. Our NPS scores are up in what I'd say are actually pretty respectable ranges even through the pandemic. So I think to your question on vendors, maybe a little, right? I think we had good contracts in place, and we had a diversified supply chain such that when one region is impacted, we go to the other. But more importantly, our customers, our scale has helped our customers a lot.

Got it. Okay. So I'm going to end with a question about the stock and the valuation. So you have a set of businesses that arguably does not reflect the overall valuations, not reflect the overall value of those separate businesses. Can you highlight some potential catalyst for unlocking that value?

Yes. So we have what we call the group of 7. I won't tell you what 7 they are, but they're 7 folks who have very high valuations and do what we do and, collectively, don't have nearly the revenue we have. They have no profit, and they use cash. They bleed cash. And they have valuations that -- or probably 7x, 10x in aggregate what ours is on a much smaller revenue base. So yes, we look at this all the time, and it's an irritant to us, and we know it's an irritant to our shareholders. Even if there's a conglomerate discount, that's still -- we're well in excess of that. We need to do 2 things. We started to improve our transparency in December 3 of last year. We'll do that again in December 9. We've got a chance to resegment our company with a combination of Cardtronics. And I think there might be a way to segment in such that we can make more apparent to the outside world, those pieces that are very valuable. And it makes them easier comparables or comparables to the folks who are pure place and have those high valuations. I can't make people value us the same way, but I can point out more succinctly that differential that's currently in place. I think the other is, if we can't -- if that doesn't work and if it becomes a strategic problem, strategic impediment to our businesses, for instance, if the digital banking business being part of us can't go raise capital on its own, it's much less expensive capital to fund its growth, then we probably need to figure out a different way to get that done on the SMB space and hospitality. So there are pieces of our business where I think, strategically, we owe it to the business to find a way to get different capital in that business, less expensive capital. Nevermind our shareholders, which, by the way, will be good for both, right, to get that done. So we look at that all the time. We have a 5-step plan that includes some of the things we just described that we talk to our Board about every Board meeting. And as of right -- of course, it takes 2 sides, right? So it's not just us wanting to do something, but in fact, finding the right partner to do it with. But we don't intend -- we didn't come here to build a conglomerate and to extend the old -- the 150-year-old company into the future as it currently exists. We've got to create value and liberate some of these assets.

Got it. Well, this has been great. For those interested to hearing more, as I have mentioned, NCR will be holding an Investor Day on December 9, which is virtual. And Tim, I appreciate your participation today, and I hope everybody has a great and productive day. Thank you very much.

Thanks a lot, Chuck. Good talk to you.