NCR Voyix Corp (VYX) Q3 2025 Earnings Call Transcript

Good morning, ladies and gentlemen, and welcome to the NCR Voyix Third Quarter 2025 Earnings Conference Call. This call is being recorded on Thursday, November 6, 2025. I would now like to turn the conference over to Sarah Schneider. Thank you. Please go ahead.

Good morning, and thank you for joining our third quarter 2025 earnings conference call. This morning, we issued our earnings release reporting financials for the quarter ended September 30, 2025. A copy of the earnings release and the presentation that we will reference during this call are available on the Investor Relations section of our website. With me on the call today are Jim Kelly, our Chief Executive Officer; Nick East, our Chief Product Officer; Beimnet Tadele, President, Restaurants; Darren Wilson, President, Retail; and Brian Webb-Walsh, our Chief Financial Officer. This call is being recorded, and the webcast is available on the Investor Relations section of our website. Before we begin, please be advised that remarks today will contain forward-looking statements. These forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from those expressed or implied by such forward-looking statements.

For additional information on these factors, please refer to our earnings release and our other reports filed with the SEC. We caution you not to place undue reliance on these statements. Forward-looking statements during this call speak only as of the date of this call, and we undertake no obligation to update them. In addition, we will be discussing or providing certain non-GAAP financial measures today, which we believe will provide additional clarity regarding our ongoing performance. For a full reconciliation of the non-GAAP financial measures discussed in this call to the most comparable GAAP measure in accordance with SEC regulations, please see our press release furnished as an exhibit to our Form 8-K filed this morning and our supplemental materials available on the Investor Relations section of our website. With that, I would now like to turn the call over to Jim.

Thanks, Sarah, and good morning, everyone. Thank you for joining us for our third quarter earnings call. Beginning with our performance, we are pleased with our third quarter results, which reflect continued progress towards the financial and operational objectives we set at the beginning of the year. I previously outlined a clear strategy to reposition the company as a software-led business, supported by robust payments and service capabilities. We remain focused on executing against each of our strategic initiatives and driving profitable growth for the company. A key milestone in our strategic shift to becoming a platform-powered software and services provider is the outsourcing of our hardware business. The ODM implementation remains on revised schedule with a phased transition to Ennoconn beginning in January. Cross-functional teams across engineering, supply chain and technical operations are actively finalizing readiness activities, validating integrations, and preparing customer support processes to ensure a smooth transition.

This shift will reduce capital intensity, streamline our operating model, and enable greater focus on our high-margin software and services businesses. We are also modernizing legacy commercial structures across our installed base. As multiyear software and services contracts come up for renewal, we are introducing price escalators to better align pricing with the value we deliver. We are applying the same disciplined approach to our payments contracts. This, coupled with the completion of the migration from the former JetPay front end, will provide us a foundation to scale payments more broadly. Our focus on expanding our payments presence across the enterprise, grocery, fuel, and restaurant verticals will further strengthen recurring revenue and enhance our long-term growth profile. Looking ahead, the company's primary growth driver will be the acceleration of innovation across the Voyix Commerce platform.

NCR Voyix has the advantage of deep domain experience in nearly three decades of enterprise software development backed by more than 50 proprietary applications and thousands of purpose-built features created in direct response to customer needs. We understand how retailers and restaurants operate and what they require to run their stores efficiently; serve their customers and scale their businesses. We have now paired that industry experience and extensive application library with AI-enabled development, significantly accelerating the time to market for our microservices architecture and new platform capabilities. Further, this approach enables us to extend the VCP to additional vertical and geographic markets at a faster pace and with greater precision. As the new solutions are deployed across our customer base, we expect higher margin software and connected payments revenue to represent a greater portion of our total revenue and enhance our growth profile.

Customer engagement continues to reinforce our strategy and product direction. At the NACS show last month, we previewed only our next-generation platform solutions and the feedback was overwhelmingly positive. We demonstrated our ability to deliver the cloud capabilities customers have been asking for to align with their modernization priorities and validate the relevance of our platform roadmap. We expect this momentum to continue as we prepare for the NRF show in January, where we will introduce a broader suite of software and payment innovations for additional retailers. On January 9, we will have the honor of ringing the closing bell at the New York Stock Exchange to commemorate 100 years since our initial public offering in 1926, a milestone achieved by only 40 public companies in the NYSE's history. This achievement reflects both the longevity and our ability to adapt and lead through market change.

As we celebrate a century of progress, we remain guided by the same commitment to innovate and disciplined execution that has defined our success for generations. With that, I will turn the call over to Nick, who will discuss our product acceleration initiatives and the formal introduction of the VCP and microservices architecture at the NRF Show.

Thanks, Jim, and good morning. Our software journey began 15 years ago with strategic investments and acquisitions to build a portfolio of category-leading, retail and restaurant applications. Today, these solutions power a significant share of global commerce, serving retailers and restaurants across more than 35 countries and representing approximately $1.4 trillion in transaction volume. Our software constitutes a significant portion of the industry's business logic library, the comprehensive brain trust that represents a massive collection of codified industry wisdom. That software value and the transaction volumes it powers every day is undeniable, but it's also trapped within a prior-generation architecture, making it slower to update and harder to integrate, the kind of friction modern architectures eliminate and our customers have demanded. Beginning in 2018, we initiated a push for modernization that is now reaching a tipping point.

First, we built a SaaS-based microservices platform in the cloud, which today connects nearly 78,000 of our retail and restaurant sites and enables online and in-store transactions, 24/7 for some of the largest operators in the world. Second, we re-architected our powerful monolithic applications into microservices, unified them on a modern code base with open APIs and secure, resilient operations baked in. And third, we acquired the industry's only edge native application engine designed to meet the runtime challenges of modern retail and restaurant environments, enabling customers to deliver change in their physical locations at the pace of their best digital channels and without the dependency on any specific hardware manufacturer. Consumer expectations continue to rise as technology cycles accelerate. Our customers see us as a partner who will help them move faster, innovate confidently, and scale profitably.

NCR Voyix is positioned to be the platform-powered leader in unified commerce for retail and restaurants. Our mission is simple: to enable our customers to accelerate new possibilities, to make every experience seamless so they keep their customers coming back. Our domain and technology experts are leveraging our extensive software footprint, together with the modern architecture of the Voyix Commerce platform, to accelerate the delivery of our next-generation applications across our entire portfolio now with the added advantage of AI-enabled development tools. AI is not merely layered on top of our platform; rather it is integrated into the build, deployment, and support of our customer environments. AI is enabling us to accelerate the availability of our application across markets and formats. As an example of bringing innovation to market this quarter, three grocery brands went live in the U.S. and Europe with our new, modernized point-of-sale application.

Each migrated from an older on-premise point of sale and began its statewide rollouts that will accelerate in 2026. The go-lives exceeded customer expectations, underscoring the agility and reliability of our platform and its role in delivering improved customer experiences. We expect this momentum to build in 2026 with more customers migrating from our current solutions and new customers adopting our platform applications for their differentiated market capabilities. We are also seeing increasing demand for cloud-native microservices-based architectures in the restaurant space, driven by the same forces we've experienced in retail: the need for faster innovation, easier integration, and more flexible deployment. Given our deep expertise and proven success in modernizing retail technology, we have chosen to bring our market-leading restaurant point-of-sale application onto the same VCP architecture.

This creates a unified modern foundation across our businesses, accelerating our roadmap and enhancing value for retailers and restaurants, and an increasing number of brands that operate combined retail and restaurant formats. As an illustration into how this modern architecture has been received, we showcased the integration of our cloud-native microservices kitchen application within convenience store environments at the NACS show last month in Chicago. Customers will be able to place food orders directly from a modern pump interface and pick them up inside the store, enhancing convenience while creating new in-store revenue opportunities. The integration of our kitchen application into the retail point of sale was completed in less than a week as both were built on the microservices architecture. To validate our expansion efforts, we recently completed a comprehensive competitive market analysis, supported by a third-party research firm with engagements from industry analysts to assess our positioning.

The results of this six-month review were clear: our strategy is aligned with that of our existing customers and the broader market. The VCP enables retailers and our restaurants to simplify their ability to accelerate their business. Additionally, our product roadmap delivers solutions to both enhance the consumer experience and optimize operational efficiencies while our proprietary domain assets are highly differentiated. As we now shift into activation mode, rolling out our commercial programs and scaling our production environments, we remain excited about the outcomes our initiatives will drive for both our customers and our business. We look forward to showcasing our latest innovations at the National Retail Federation show in New York this January. This will be followed by six additional conferences across the markets we serve. We invite investors to join us at the Javits Center to experience the solutions firsthand and engage with our teams and customers.

Thanks, Nick. In the third quarter, our restaurant business signed more than 200 new software and services customers. Our platform and payment sites increased 6% and 2%, respectively. Software ARR increased 3% and total ARR increased 7% in the quarter. In our Enterprise division, we signed a multiyear platform and point-of-sale agreement with Marco's Pizza, one of the fastest-growing pizza chains in the United States, to support its global expansion efforts. The initial phase of this rollout will commence in Mexico before the end of the year, followed by subsequent international locations. This partnership reflects the strength of our global footprint and offering, and we anticipate further growth in our enterprise business worldwide. As Jim and Nick mentioned, the company recently made the decision to leverage our edge-enabled microservices architecture to bring our Aloha next-generation point of sale to market, beginning with enterprise restaurants.

The customer response to the initial preview of our edge-enabled microservices architecture has been incredibly positive, validating our strategy and reinforcing the depth of our enterprise relationships. We plan to begin lab testing the Aloha next-generation point of sale for targeted formats in the first quarter of 2026, with broad availability across all segments by the third quarter. I'm excited about the significant growth opportunity as we deploy our edge-enabled dual cloud microservices applications and continue transforming the future of restaurant operations. In payments, customer adoption of our payments gateway solution continues to grow. This quarter, one of our existing software customers, a Mexican fast casual restaurant with nearly 600 sites, selected Voyix Connect as their payment gateway interface. Additionally, we continue to execute on our pricing initiatives, moving to a model based on transaction volume, which provides a solid foundation for our business and is in line with the market. I will now turn the call over to Darren to discuss our retail performance.

Thanks, Benny. Good morning. In the quarter, our retail business signed over 30 software and services customers. Our platform and payment sites increased 16% and 9%, respectively. Software ARR increased 11% and total ARR increased 4% in the quarter. Over the last two years, we have signed more than 15 mid-market and enterprise customers for our Voyix point-of-sale and self-checkout solutions, which will be implemented over the coming months. We continue to enhance the Voyix Commerce platform with value-added applications and direct integrations that serve both new and existing retail customers. Most recently, we significantly expanded our domestic fuel offering, signing long-term agreements for commercial fleet card acceptance with two of North America's largest providers. These agreements will enable us to serve as both a point-of-sale provider and full-service payments processor for both consumer and commercial fuel transactions at over 18,000 locations.

By managing the entire transaction life cycle, we are enhancing the value of our integrated payments capabilities and strengthening our overall value proposition. This also materially expands our addressable market for payments in the U.S. With nearly $600 billion in volume running through our fuel payment gateway and $800 billion in consumer card volume, we now have the ability to target approximately $1.4 trillion in U.S. payment volume. We also launched our next-generation loyalty solution, Voyix Loyalty. The delivery of this cloud-native and microservices-based application facilitated a multiyear agreement with HEB, the largest grocer in Texas and a new NCR Voyix customer. We will enable promotion execution across HEB's nearly 400 store footprint through a direct integration into HEB's in-house point-of-sale software, demonstrating the agnostic design of the VCP and its edge-enabled microservices applications.

Additionally, we signed an expanded multiyear agreement with a regional grocery store alliance, encompassing nearly 300 stores across three brands in the Northeastern United States. Through this partnership, we will now deliver a full suite of next-generation platform solutions, including Voyix point of sale and self-checkout, loyalty and hardware maintenance across their entire state. Finally, in services, we expanded our longstanding relationship with a large multinational wholesale grocer, becoming the exclusive service integrator for over 20,000 lanes across 2,000 stores in Belgium and the Netherlands. In addition to providing hardware maintenance, we will now provide vendor management and be the sole point of contact for all the brand's technology-related services. This large-scale expansion demonstrates the strength of our services division and its ability to meet the complex needs of our global customers. With that, I will turn the call over to Brian.

Thank you, Darren, and good morning. For the quarter, total revenue of $684 million declined 3% due to lower hardware sales and onetime software and services revenue. Recurring revenue increased 5% to $425 million, driven by 7% growth in restaurants and 4% growth in retail. Software ARR and total segment ARR increased 8% and 5%, respectively, platform sites increased 12% to 78,000 and payment sites increased 3% to nearly 8,500. It's important to note that the majority of our customer base consists of large enterprise brands whose entire store or restaurant footprint is converted to the platform once connected in its entirety. As such, platform site growth can fluctuate depending on the timing of complete onboarding. Adjusted EBITDA of $125 million increased 32% as margin expanded 490 basis points to 18.3%. This was primarily driven by larger-than-anticipated hardware margins and the previously announced cost actions.

Turning to our segment results, beginning with Restaurants. Total segment revenue of $210 million was flat, which reflects an increase in recurring revenue, offset by declines in onetime services revenue. Recurring revenue increased 7% to $146 million, driven by payments growth and the ramping of a new large customer agreement. Segment adjusted EBITDA increased 12% to $74 million as margin expanded nearly 400 basis points to 35.2%. This improvement was driven by revenue mix, coupled with the previously announced cost actions. Turning to Retail. Total segment revenue declined 4% to $467 million, primarily due to declines in hardware sales and onetime software and services revenue. Recurring revenue increased 4% to $276 million, driven by the ramp of a new large customer agreement and platform revenue growth. Segment adjusted EBITDA declined 17% to $90 million, driven by lower revenue and customer adjustments tied to prior year delayed software implementations now resolved, along with favorable expenses in the prior year period.

Adjusted EBITDA margin decreased 290 basis points year-over-year to 19.3%, but increased 150 basis points sequentially as expected. Lastly, net corporate and other expenses improved to $39 million, which reflects the previously discussed cost initiatives. Adjusted free cash flow was $42 million for the quarter before considering $23 million of restructuring cash expenditures and $3 million of accelerated product investments. We invested $38 million in capital expenditures during the quarter. For the full year, we expect CapEx to be approximately $160 million, inclusive of accelerated product investments. Restructuring cash outflows totaled $23 million for the quarter. We have now exited all of our remaining TSAs with NCR Atleos, are winding down our TSAs with Candescent and are approaching the ODM implementation. In connection with these initiatives, we have taken incremental cost actions including headcount reductions in the third quarter.

Therefore, we now expect transformation restructuring cash outflows for 2025 to be approximately $100 million. Our net leverage position was 2x at the end of the third quarter based on our net debt as of September 30 and the last 12 months adjusted EBITDA. Turning to the outlook. We now expect revenue to be between $2.65 billion and $2.67 billion. Hardware revenue is anticipated to be above prior expectations, while software and services revenue will be slightly below. The lower software and services revenue is primarily due to customer adjustments tied to prior-year delayed software implementations, which have now been resolved. Adjusted EBITDA is now expected to range between $420 million and $435 million, and non-GAAP diluted EPS is expected to be between $0.85 and $0.90. We expect adjusted free cash flow to be between $170 million and $175 million, excluding restructuring and transformation costs and accelerated product investments. With that, I will turn the call back over to Jim for closing remarks.

We are encouraged by the progress across the business. Our innovation engine is accelerating, our pipeline is strengthening, and customer engagement remains constructive and aligned with our strategy. We are focused on disciplined execution and position the company for sustainable, profitable growth. I will now turn the call over to the operator to begin the question-and-answer session.

Before beginning the Q&A portion, the company has an additional item to announce.

Thank you, operator. I want to share an important update this morning. We signed a new six-year exclusive agreement with Chipotle, strengthening a partnership that has lasted over 25 years. With this agreement, Chipotle will enhance their collaboration with NCR Voyix and will be the first to implement our Aloha next-generation point-of-sale system and supporting applications across 4,000 restaurants worldwide. This solution is built on the Voyix Commerce platform, utilizing a dual-cloud, edge-enabled microservices architecture, marking a first for the restaurant industry and showcasing our long-term investment in microservices technology. This project has been in progress for several months, and while we hoped to announce it at the beginning of the call, we finalized it just this morning. I want to express my gratitude to the team at Chipotle, including Benny, Miguel, their teams, and our General Counsel, Kelli Sterrett, along with Laura and the rest.

This has been a significant effort, and I believe this is a monumental moment for the company. It clearly indicates a shift within the organization. A renewal of a 25-year partnership for another six years is a testament to the quality of our product offerings, which Nick has been highlighting, and reflects our capability to meet the expectations of our customers. With that, I’ll now hand it back to the operator to start the question-and-answer session.

Congrats on the win, by the way. Can we talk about the price escalators you've referenced, the magnitude we should be sort of expecting, how much revenue is ultimately impacted by that and would be set a benefit from what you're doing there? And maybe more importantly, can you talk about how this maybe differs from Voyix's historical practice? And then I have a follow-up.

Sure. Matt, I think if you go back to whether it was the year-end call or the first quarter, I think I've mentioned this before, but the company historically had not had escalators in all of its agreements. In some areas, it did, but typically did not. And even if it did, it was unclear if they were actually billing them accordingly. So we've just gotten back to make sure the ones that were actually in the agreements are there, and we're charging accordingly. And then secondly, where they're absent as the contracts renew. So on the retail side, it tends to be every five years as a general rule and restaurant tends to be three years. I don't think we've scoped the order of magnitude. I mean these are not extreme increases. This is more cost of living plus something as opposed to some material increase. So I think what we'll see, and we've already started to see it, it's relatively small since it's just gotten started.

But we are seeing increases on the revenue and earnings line as a result of this. And this is really the value that we're providing, supporting, these are very tired, old legacy applications that are continuing to operate at our customers. And for the company to be able to continue to invest in its business, keeping a five-year contract flat over a five-year time period just degrades its value in years 2, 3, 4, and 5 because, obviously, we experience cost escalators as well. And that's not the primary focus. Our primary focus is to sign new customers and then ultimately to launch all the products that Nick outlined on the call, which we expect to see we will have at NRF in January for the market.

And then just to talk about the payment side of the business. I would think these new relationships on fuel and convenience have to be more needle-moving in nature. Is there a way for you to somehow quantify or directionally quantify what that maybe adds to the payment side of the business, and maybe when we can expect to get a little bit more granular financial detail on the payments performance?

Sure, that's a great question. Many of the opportunities I've discussed since taking on this role highlight areas of potential growth that the company has not fully leveraged in the past. Regarding your last question about the appropriate adjustment of prices for contract renewals, we're still in the early stages. Our company has a long history of 145 years, which is quite different from industries like credit cards, where price increases can be implemented uniformly and quickly. Our relationships are longstanding and important, so we're working to level the playing field. If you're referring to the commercial side, we've made significant progress domestically, achieving $800 billion in the U.S. alone on our Voyix Connect platform. Recently, we announced key partnerships, one with Corpay and another with WEX. Although we're involved in commercial fuel through point-of-sale support, we haven't previously been engaged with the commercial fuel payment sector, making it challenging to serve the retail forecourt effectively.

Going forward, we’re transitioning from simply being a point-of-sale provider to also being a payment solution for both commercial and retail sectors. To illustrate the scale, we currently manage about 17 billion transactions in the U.S. with an estimated volume of roughly $500 billion. When you combine what we have on Voyix Connect with another app called Epsilon, the total market opportunity in the U.S. is around $1.3 trillion. This gives us the chance to tell customers that we offer more than just point-of-sale services; we can also provide payment solutions in the commercial space. During our time at NACS last month, we received positive feedback on our approach, especially since our customers usually have multiple intermediaries for point-of-sale and payments. Our integrated solution simplifies the process, eliminating complications that arise with multiple parties, which tend to lead to inconsistencies.

Many customers prefer a single solution, and we believe this will be well-received. This capability isn't limited to our new next-generation Voyix point-of-sale but also works with our current applications that already handle commercial fuel transactions. Ideally, we want to launch this along with our next-gen offering, which was our focus at NACS. We will continue to work on this development as we approach January and prepare for NRF.

Congratulations on the Chipotle expansion; it's a significant achievement and a notable win for the Aloha platform. I wanted to ask about your recent conversations regarding the implementation of your payment gateway strategy, particularly in terms of pricing. How are those discussions unfolding? I know you're highlighting the value you provide, and with that in progress, I'm curious about how the market is reacting. Additionally, it seems like the Global and Worldpay deal is set to close in the first quarter, a bit earlier than anticipated. What potential advantages do you see arising from this, especially in terms of opportunities with Worldpay?

We have a strong relationship with Global and the combination of our strengths is beneficial for us. Global has unique advantages over Worldpay and vice versa, which enhances our offerings. I'm not aware that the closing is speeding up, but we're nearing the end of our migration from the legacy JetPay system. Customer feedback has been very positive. I have a significant customer meeting next week to discuss payments, and they seem engaged with our approach. Having multiple intermediaries in tech can lead to breakdowns, and I haven't encountered any resistance to our services. Transitioning customers isn’t instantaneous. People value the changes we’re implementing. There are considerable opportunities in payments and our next-gen services, both for current and new clients. It’s a large organization, and while it will take time to fully pivot, our customer retention remains strong at 1%. We aren't losing clients; we just need to execute well.

Our relationship with Chipotle has significantly improved since I started in February, as I've built a rapport with key individuals there. Our team collaborated with them during their RFP, and they're pleased with that innovation effort. We aim to offer additional services like payments without adding costs, possibly even decreasing expenses for them while simplifying processes. Ultimately, customers are seeking cost savings, efficiency, and dependable partnerships, which we are able to provide.

Jim, you mentioned the ODM phasing project is going to kick off in January. Just wondering if you can give an update on how long you expect that to take place and what the phasing of that project actually looks like.

Sure. So I think, again, on the background on this, we had earlier expectations that would go faster. There were some technology challenges on their side, and so we pulled back. Obviously, hardware remains important to us and, obviously, to our customers, but this is better. I think where we're moving as a company, this is still the right direction. The expectation, there's effectively three major facilities that have to switch over. So we are intending to start that the first -- not the first day, but the first week or second week of January, start moving it in pieces. I believe we'll retain our employees that would otherwise transfer across that have already been alerted to this during the roughly 90-day period. I think the expectation is 90 days. Could it extend beyond that? Anything is possible, but we're trying to do this in a way that has zero impact to our customers and as well makes it an easy transition for our employees. During the first quarter, we'll continue to report gross revenue as we have today. But my current expectation is that by the beginning of the second quarter, that will be on a net accounting basis as we've outlined from the beginning.

Got it. And then in your conversation and your salespeople's conversations with your customers, I was wondering if there's any insights they're sharing on the health of the consumer. And how that's informing their willingness to spend into '26? And I guess more importantly, as a backdrop, what sort of cyclicality have you historically seen around technology investments in response to consumer sentiment there?

We want to give everyone a chance to speak on this call. I'll start with a few comments, and then I'll turn it over to Darren and Benny, who interact with customers more frequently than I do. For instance, Chipotle represents a significant investment on their part, as they are looking for the technology we have that we haven't previously provided. We've offered solutions on the retail side, but historically, the restaurant side has taken a different approach, relying on a more traditional application in Aloha Cloud, which is being developed to replace the older Essentials version 19. I haven't observed any hesitation from customers in terms of making purchases when we can provide value and reduce costs. At the recent NACS show, where it was my first time attending trade shows in this industry, we introduced three brand-new products, without any legacy products in the mix. Two of these products were developed just three weeks before the show, demonstrating our rapid innovation.

There was considerable interest in one product specifically related to our commercial fuel application, as the major players in that sector were drawn to what we presented since it closely resembled their current systems. This is a major advantage for us. As Nick mentioned earlier, we have a portfolio of over 50 existing applications, keeping us in tune with what our customers need because we are servicing those needs today. We are able to modernize their requirements without forcing them to switch to something entirely new or alter their organizational processes. Ultimately, this approach reduces costs, as we can manage the store ourselves without relying on third-party operating systems that incur additional expenses. It's simply more efficient. Now I'll hand it over to Darren and Benny for their insights.

Thanks, Jim, Parker, yes, the conversations with our customers through the shows are one-on-one around the globe continue on a very healthy nature. Many of our enterprise customers are looking at infrastructure or capability upgrades, be that on new or existing hardware solutions. But ultimately, therefore, our microservices play, and open API models are having real appeal in terms of either elongating or sweating their existing hardware assets or coming with new hardware propositions. But bolting on to that is a real appeal about enhancing the servicing or the services solutions for them as an added-value feature. So they are very healthy conversations globally on that basis. And there's a real appetite for a unified commerce-type model. And therefore, as Jim has outlined, bolting on our payments gateway and our payment solution is having universal appeal. Now these are long-term contracts with ourselves and with payments provider.

So there's been a lot of questions about the timing of this. I think as Jim has alluded to previously, the typical contract duration in retail is five years; in restaurant, it's shorter in terms of three. So that gives you the kind of renewal cycle of the materiality of the contract, but bolting on the additional capabilities in the interim is coming. And typically, a payments contract would normally be a three-year cycle in both verticals. So that opens up the scale of the conversations, opportunities to switch on that unified commerce capability into our customers. In terms of health of consumer, as we see various earnings releases from many of our retailers around the globe, I think universally, it's steady. I think in some markets, grocery supermarkets are saying that they're having probably the best consumer stability or growth record for many years. I know there's a reporting kind of steady, low single-digit performance.

I think we're starting to see a trend to that unified commerce model in terms of consumer behavior, looking at the multiplicity of channels into the retailers we support. And I think, again, we're well positioned for that. So I don't think there's any massive revolution coming in terms of growth potential or otherwise. But I think the steady evolution is encouraging as we speak today. So I'll pass over to Benny or Nick.

I want to add to that. I speak with customers frequently, and during my prepared remarks, I mentioned that we have successfully onboarded some grocery chains onto our new platform this quarter. I visited those customers and saw that they were extremely busy. I cannot recall having a conversation with a customer that was based on a lack of consumer confidence. In fact, it seems that this environment is making our customers more eager to compete for consumer business. The main discussion revolves around how they can provide the right experience to ensure consumers keep coming back. This leads to a conversation about technology. They want to deliver faster experiences and ensure that customers are presented with competitive offers. This is why they are keen to invest in technology, as it allows them to improve customer loyalty and respond to competition more quickly. The focus is on how to rapidly enhance competitive experiences for their customers.

These technology investments are not just concepts; they are actively being made. The emphasis is on speed and accelerating the customer journey. There are also specific areas where they are investing, such as in loss and waste management. It is crucial for our customers to maintain cost control amid rising costs. Therefore, we are discussing solutions to help minimize loss and waste in both retail and restaurant sectors. Ultimately, the core theme is their desire to invest in technology to attract and retain their consumer base while competing effectively for those customers.

I agree. It's similar in restaurants; it's the same trend. I acknowledge that there is economic pressure on a lot of restaurants, logistics, food cost, labor cost, labor shortage, etc. That has actually an opposite effect in terms of looking at technology, restaurants when we have conversations, are having more and more conversations on how can I leverage technology to create either the revenue acceleration, which Nick talked about, how can I get more consumers into the door, how do I understand on a one-to-one basis my diners so that I can provide the service required and repeat customer same-store sales growth, etc.? But also efficiency, efficiency in terms of automation. So technology that can easily integrate so that you can manage the journey of the consumer from online ordering, coming into the restaurant, understanding what is available in the restaurant so that you can actually offer up and make that one-to-one offer, etc., all the way to automation so that I can transfer some of the things that required heavy labor from employees, store managers and free them up and have less labor costs.

All of those things are technology conversations. So we're having those conversations whether it's in the super RFP cycle that I referred to that we're in. We're actually seeing a lot of RFPs looking at innovations and creations like Chipotle example that Jim provided around the innovation during the RFP cycle, one of the key things is the ability to innovate, the ability to capture revenue, and the ability to create automation inside the restaurant. So we're having a healthy conversation, a pretty good pipeline. I think that's what we're seeing.

There are no further questions at this time. I will now hand the call back to Jim Kelly for any closing remarks.

Thank you, operator, and thank you all for your continued interest in the company.

And this concludes today's conference call. Thank you for participating. You may all disconnect.