管理層發言
Hello. Good day, and welcome to Diebold Nixdorf, Incorporated’s Fourth Quarter and Full Year 2025 Earnings Call. My name is Ellie, and I will be coordinating today's call. Following our speakers’ remarks, there will be a question-and-answer session. In order to ask a question, please press star followed by one on your telephone keypad. Thank you. I would now like to turn the call over to our host, Maynard Um, Vice President of Investor Relations. Maynard, please go ahead.
Hello, and welcome to our fourth quarter and full year 2025 earnings call. To accompany our prepared remarks, we posted our slide presentation to the Investor Relations section of our website. Before we start, I will remind all participants that you will hear forward-looking statements during this call. These statements reflect the expectations and beliefs of our management team at the time of the call, but they are subject to risks that could cause actual results to differ materially from these statements. You can find additional information on these factors in the company’s periodic and annual filings with the SEC. Participants should be mindful that subsequent events may render this information to be out of date. We will also discuss certain non-GAAP financial measures on today’s call. As noted on Slide 3, a reconciliation between GAAP and non-GAAP financials can be found in the supplemental schedules of the presentation. With that, I will turn the call over to Octavio, who will begin on Slide 4. Good morning, and thank you for joining us.
2025 marked the defining year for Diebold Nixdorf, Incorporated. We strengthened our foundation, delivered on our commitments, and most importantly, demonstrated that we are now operating a sustainable free cash flow generator with a significantly more stable and predictable financial profile. We grew revenue, expanded adjusted EBITDA to $485,000,000, and more than doubled free cash flow to a record $239,000,000. These results reflect the disciplined execution, the strength of our lean operating model, and a portfolio increasingly aligned to long-term automation trends in banking and retail. Today, the conversation will center on the durability of our operating model, our ability to generate strong and consistent cash flow, and the opportunities we have to deploy that capital in ways that drive long-term shareholder value. What matters most to us and what our results clearly demonstrate is that we are delivering on what we said we would do, quarter after quarter. This consistency is increasing predictability in our model and strengthening confidence in our long-term outlook. Our core businesses remain strong, and our growth initiatives are gaining traction. In banking, we are expanding our role beyond the ATM to orchestrate the broader branch and transaction ecosystem through expanded service offerings, software-enabled automation, cash management solutions, and innovative hardware, helping financial institutions operate more efficiently while improving the consumer experience. In retail, momentum continues to build, with three consecutive quarters of revenue growth as we expand in North America, win new logos, and scale AI-driven solutions that help customers reduce shrink, increase throughput at checkout, and operate more intelligently. We also delivered a record fifth consecutive quarter of positive free cash flow. Importantly, we also received two credit rating upgrades this year, independent validation that our operating model and financial model continue to improve. With net leverage around one times, and free cash flow growing, returning capital to shareholders will remain a core part of our value creation framework. Today, we are a stronger and more predictable company, with multiple ways to win and create value. We are entering the year with momentum, a fortress balance sheet, and a clear focus on delivering another year of profitable growth and cash generation. With that, let me walk you through our key takeaways for the year. Please move to Slide 5. Slide 5 reflects the consistent execution and financial progress we delivered throughout 2025, reinforcing the strength of our operating model. We delivered strong year-over-year improvement across our key financial metrics, meeting and in several areas exceeding the commitments we established at the beginning of the year. Order entry grew 17% year over year, supported by healthy demand across both banking and retail, and demonstrating the continued relevance of our solutions as customers prioritize automation, efficiency, and innovation. Revenue performance reflects disciplined execution across the portfolio. In banking, the core ATM business remains stable, while our strategic growth initiatives gained traction. In retail, the core businesses in Europe recovered and strengthened as the year progressed, with accelerating momentum in the U.S. behind our SmartVision AI solution. We recently completed a pilot with one of the world’s largest retailers in the U.S., and are now transitioning into multiple live store implementations, an important step towards scaling the opportunities. Adjusted EBITDA grew to $485,000,000, reaching the higher end of our guidance, with margins expanding 60 basis points. This improvement reflects the structural benefits of our lean operating model, continued cost discipline, and operating leverage as we simplify the business and scale more efficiently. Free cash flow was a standout in 2025. We generated a record $239,000,000, more than doubling prior year cash flow and representing approximately 49% conversion, well above our original outlook and approaching our 2026 target of greater than 50%. We expect this momentum to continue. Stronger working capital, lower interest expense, and higher profitability demonstrate the growing cash generating capability of our models, and enhance the financial flexibility to invest in growth while returning capital to shareholders. Adjusted earnings per share reached $5.59 for fiscal year 2025. We more than doubled EPS year over year even excluding certain noncash, nonoperational favorable tax benefits. One year into our three-year plan, the financial algorithm we outlined is taking hold, and we are executing as committed. That consistency is strengthening confidence in our outlook and reflects an operating model with multiple ways to win and create value. Slide 6 highlights the growth engines that are strengthening the durability of our revenue and expanding our long-term opportunity across banking, retail, and service. We are gaining traction in the areas that matter the most: automation, software and service recurring revenue, all of which support higher quality growth over time. In banking, our role continues to expand beyond the ATM as financial institutions modernize their branches and optimize cash and transaction ecosystems. By automating manual processes, reducing cash-in-transit visits, and improving staffing efficiency, our solutions deliver measurable operational value for our customers while positioning us to capture a larger share of their technology spend. During the year, our branch automation solutions built momentum with large multiyear wins in Europe and a key new multimillion dollar win in North America, reinforcing the relevance of our strategy across major markets. We also expanded the DN Series portfolio with the introduction of the DN Series 300 and 350. Combined with our VCP 7 software that enables interoperability across devices, these offerings are helping customers increase availability, lower operating costs, and simplify branch operation. Fit-for-purpose continues to gain traction across both high-capacity and our smaller energy-efficient configurations. Notably, we received certification from one of the largest public banks in India, positioning us to compete in all public bank tenders and opening the door to one of the fastest growing ATM markets globally. In retail, we are encouraged by the momentum we are seeing, particularly in North America where we secured nine new logos, including a win with one of our top targeted grocery accounts. The strategy that established our leadership position in Europe—centered around openness and modularity—is now gaining traction in North America and significantly expanding our addressable market. Our SmartVision AI solution continues to differentiate our portfolio and generate strong customer interest. At the NRF show, we engaged with more than 800 customers, partners, and prospects, reinforcing the growing relevance of AI-driven capabilities and smarter store operation as retailers focus on shrink reduction and checkout throughput. In services, our focus remains on being the most trusted service provider in the industry. We continue to optimize our service and repair centers globally, improving turnaround times, driving greater consistency and quality, which led to higher uptime for our customers. This, coupled with the completed North America rollout of our enhanced field service technician software, resulted in our best SLA performance of the year. With this, we are strengthening customer loyalty, supporting product pull-through, increasing the lifetime value of our installed base, and further enhancing the recurring nature of our revenue. In operations, teams have fully embraced Lean, bringing in new ideas to reshape legacy paradigms of how and where work gets done. Our local-for-local sourcing and manufacturing strategies are strategic advantages for our company and have allowed us to navigate market challenges in 2025 and provide a strong foundation as we enter the new year. By leveraging common platforms and components across our ATM and branch automation portfolio, we are driving greater efficiency, scale, and simplified operations for our customers. Across the company, working capital improvements drove great results. Days inventory outstanding and days sales outstanding again improved year over year. Tom will share details in a moment. While we remain disciplined in our expectations, the traction we are seeing across the growth engines increases our confidence in the power of our model as we move into 2026. All these advancements position the company to deliver more predictable performance while expanding our long-term growth runway. Now let us turn to Slide 7. Slide 7 highlights how Lean is becoming a structural advantage for us as we systematically lower our cost base, improve working capital, and continue to expand margins. What began as a manufacturing initiative has now scaled across supply chain, services, and business operations, embedding continuous improvement into how we operate and creating a more robust and scalable enterprise. Across global manufacturing, the implementation of our dynamic Kanban system spanning more than 400 high-use items has driven an approximately 30% sustained reduction in inventory while eliminating expedites and improving part availability. These actions are releasing working capital, strengthening cash conversion, and enhancing operational predictability. In our shared business services organization, cross-functional teams from 11 countries standardized order processing and accelerated invoice cycles, reducing processing time by 17% and improving collection efficiency. These improvements are repeatable and are now being scaled across additional geographies. This is how we approach Lean: identifying structural efficiencies, institutionalizing them, and then extending those benefits across the enterprise. Our progress has also been recognized externally, including being named by Newsweek as one of America’s Most Responsible Companies, reflecting the strength of our supply chain, ethical standards, and community engagement. It proves that operational excellence and responsible business practices can advance together. As Lean continues to expand across the organization, we see meaningful opportunity to unlock further efficiencies, strengthen margins, and improve cash flow. Importantly, many of the financial improvements Tom will discuss next are being enabled by these structural efficiencies. Lean is not a one-time initiative. It is a core capability that is reshaping how we operate. With that, I will turn it over to Tom to walk through our financial results.
Thank you, Octavio. 2025 was an exceptionally strong year of performance for us. We grew revenue, expanded margins, and more than doubled free cash flow and adjusted EPS. These results reinforce that we have multiple ways to win and demonstrate our strong operational execution across the enterprise. Q4 revenue was $1,100,000,000, up 12% year over year and 17% sequentially, driven by growth in both product and service. In banking, high-capacity fit-for-purpose ATMs and strong performance in Europe drove results. In retail, strong point-of-sale and self-checkout performance globally drove revenue increases. Total gross margin expanded to 27.1%, up 320 basis points year over year and 90 basis points sequentially, reflecting favorable product and geographic mix. Product margins were 28.2%, up 80 basis points sequentially. Service margins increased to 26.2%, up 80 basis points sequentially. For the full year 2025, total company gross margin was 26.4%, up 110 basis points year over year. Margin expansion was driven by products, where gross margin increased to 27.4%, up 300 basis points year over year. Strength in product margins allowed us to accelerate investments in our service infrastructure, consolidating our repair and service centers, deploying our field service software, and adding field technicians. As a result of these investments, service margins finished the year at 25.6%. We delivered strong Q4 operating profit of $129,000,000, up 81% year over year and 48% sequentially, driven by higher revenues and continued margin benefits from our mix and our lean operating model. Operating margin expanded 440 basis points year over year to 11.6% in the quarter. Operating expense was relatively flat year over year on higher revenues. We continue executing against our plans to reduce SG&A, and we have made solid progress on the over 200 action items that are part of our cost reduction program. For the full year 2025, operating expense was up 3.7% driven by higher labor and benefit expenses partially offset by our savings initiatives. Exiting 2026, we expect annualized run rate operating expense savings of up to $50,000,000, of which we expect to realize up to half of these savings in 2026, resulting in a reduction of approximately 1% to 2% of operating expense. Lean methodology and disciplined execution are driving our strong improvements in our results. Continuing on to Slide 9. We delivered record Q4 adjusted EBITDA, record full year adjusted EPS, and generated record full year free cash flow. Q4 adjusted EBITDA reached $164,000,000, up 46% year over year with 350 basis points of margin expansion. Sequentially, we delivered 35% growth and drove an additional 200 basis points of margin improvement, bringing EBITDA margins to 14.9%. Adjusted EPS for Q4 was $3.02 and for the full year 2025 was $5.59. This includes $1.08 of noncash, nonoperational favorable items, including a tax valuation allowance release in the amount of $0.57 in Q4, and as we previously disclosed, a benefit of $0.51 recognized in Q3 due to lowering of the statutory rate in Germany. Excluding these items, 2025 EPS was $4.51. In 2025, we returned $128,000,000 to shareholders through repurchases representing 2,300,000 shares, or approximately 6% of the company, at an average share price of $55.47. Free cash flow in Q4 was $196,000,000, up 5% year over year, or approximately $10,000,000. For the full year 2025, we generated $239,000,000 of free cash flow, more than doubling 2024’s result of $109,000,000 and setting a new annual company record. Strong Q4 performance year over year was driven by lower interest expense following our late 2024 refinancing, continued progress in streamlining service contract collections, and additional working capital initiatives. Year over year, days inventory outstanding improved by nine days, and days sales outstanding improved by four days, and we continue to see further opportunities ahead in both. As I have shared with our teams internally, there is no finish line in our continuous improvement journey, only more opportunity. Moving to Slide 10. Banking delivered strong product and service revenue growth, with revenue up 11% year over year in Q4 and up 1.2% for the full year. Banking product revenue in Q4 grew 20% year over year, driven by strong ATM recycler adoption across our major markets. Banking services revenue grew 5% year over year in Q4, primarily driven by higher revenue contributions from Europe. Banking gross margin expanded 410 basis points year over year in Q4 and 160 basis points for the full year driven by strong product margins, allowing us to strategically accelerate the investment in services. As a result of these investments, service margins ended the year at around 25%. We are encouraged by customer feedback on these service investments, including engagements with large financial institutions, record net promoter scores, and our strongest SLA performance of the year. Together, these indicators reinforce our confidence in improving banking service margins this year and over the long term. Turning to Slide 11. We had a strong end to the year in retail, achieving our third consecutive quarter of sequential revenue growth. Q4 retail revenue increased 12% year over year to over $300,000,000, and retail revenue for the full year grew 2.1%. Retail product revenue grew 16% year over year in Q4, supported by strength across point of sale and self-checkout in major markets. For the full year, retail product revenue increased 5.4% driven by strong global point of sale unit growth and higher self-checkout shipments in North America. In retail service, revenue increased 8% year over year in Q4 driven by core service and higher installation work. For the full year, retail services revenue was comparable to prior year, due in part to certain large customers that experienced external cyber-related disruptions that reduced our ability to provide service to them. We have now resumed full service for those customers. Turning to profitability, strong demand and higher volumes drove overall retail gross margin expansion of 80 basis points year over year in Q4. For the full year, overall retail gross margins declined 20 basis points, tied to the service disruptions I just mentioned. Looking ahead, retail is entering 2026 with strength. We are securing high-quality new business wins including multiple new logos in the U.S. grocery and QSR segments, in addition to growing our core European business. Overall, retail is positioned to continue growing revenue and gross profit dollars on a year-over-year basis. This will be driven by the acceleration of our growth initiatives in North America, continued new logo wins, sustained momentum in Europe, and the scaling of our differentiated AI-driven solutions. Turning to Slide 12. Our 2026 guidance reflects our increasing confidence in our operating model and the momentum we are carrying into the year. We are establishing our 2026 guidance for revenue, adjusted EBITDA, and free cash flow, all of which are higher than the original targets we shared at our 2025 Investor Day. For revenue, we are establishing a range of $3.86 to $3.94 billion. We expect the quarterly cadence for revenue to be consistent with 2025 based on each quarter’s share of the full year revenue. This outlook is supported by our $733,000,000 of product backlog and the significant reduction in product delivery lead times. Additionally, our January order entry is very strong, which gives us clear line of sight to our first half revenue. We expect total gross margin in 2026 to increase by another 25 to 50 basis points year over year. As we ramp up hiring in the U.S. in anticipation of converting strong service pipeline and further improving our SLAs, from Q2 onward, we expect sequential year-over-year improvement as scale increases and these investments begin to deliver returns. For adjusted EBITDA, we project a range of $510,000,000 to $535,000,000, representing growth of approximately 8% at the midpoint. Turning to free cash flow, we forecast free cash flow in the range of $255,000,000 to $270,000,000, representing roughly 10% growth at the midpoint, supported by continued working capital improvements and disciplined capital allocation. Once again, we expect to generate positive free cash flow in every quarter of the year. Starting this year, we are introducing guidance for adjusted earnings per share. For 2026, expect adjusted EPS to be in the range of $5.25 to $5.75, assuming an effective tax rate in the range of 35% to 40%. At the midpoint, this guidance reflects approximately 22% year-over-year growth on a comparable basis when excluding certain noncash, nonoperational tax benefits in 2025 that we previously mentioned. I would also like to point out that our free cash flow per share is significantly higher than our EPS as a result of stronger cash generation than earnings alone suggest. Overall, our 2026 outlook reflects the strong foundation built in 2025, the durability of our operating model that we have put in place, and the strength we are carrying forward. Turning to Slide 13. We ended 2025 in an exceptionally strong financial position with more than $700,000,000 of liquidity, including $416,000,000 in cash and short-term investments and an undrawn $310,000,000 revolver, with a net debt leverage ratio at 1.1 times. Our balance sheet strength is a reflection of disciplined execution throughout the year. 2025 was also a standout year for capital returns. We completed our initial $100,000,000 share repurchase program in just over eight months and announced a new $200,000,000 authorization in the fourth quarter. Through year end, we repurchased $128,000,000 of our common shares, representing approximately 6% of the company’s total shares outstanding at an average share price that is 25% below where our shares are trading, which we believe is an excellent return on our investment. We are targeting the completion of the $200,000,000 program in a similar time frame. Our balance sheet strength and consistent free cash flow generation were recognized externally as well. In Q4, Moody’s upgraded our credit rating to B1 from B2, our second credit rating upgrade of 2025, underscoring the meaningful progress we have made. Looking ahead, our capital allocation strategy remains consistent and firmly aligned with shareholder value creation. Since the beginning of 2025, we have delivered substantial shareholder value through strong execution and consistent capital returns, with our stock appreciating more than 65%. Given our performance and outlook, we believe that repurchasing our shares at today’s valuation still represents one of the most compelling opportunities to continue to drive long-term shareholder value. We continue to believe that our stock is undervalued and our ability to generate free cash flow is underappreciated. In 2025, we returned over 50% of our free cash flow to shareholders, despite having only begun our repurchase program in March 2025. Going forward, we expect to increase our returns to shareholders as a percent of free cash flow, supported by our balance sheet strength and our target of $800,000,000 of cumulative free cash flow from 2025 through 2027. We are committed to prioritizing returns to shareholders through share repurchases while also maintaining the flexibility to pursue small strategic tuck-in acquisitions that strengthen our long-term growth profile. With that, I will turn it back to Octavio for closing remarks.
Thank you, Tom. As we look to 2026, what is increasingly clear is the continued strengthening of our operating and financial foundation. We have built a strong, strategically aligned portfolio that balances strong core businesses in banking and retail with scalable growth platforms, positioning us to deliver sustained performance and long-term value. We are a company with a high-quality business model, fueled by a culture of continuous improvement, delivering consistent performance, generating substantial free cash flow, and embedding structural efficiency across the enterprise. I want to recognize our employees, customers, and partners whose execution and trust made these results possible. The progress we are reporting today reflects the strength of our teams and the depth and support of our partnerships around the globe. We are entering 2026 with momentum and confidence in our ability to continue strengthening the business. And with that, operator, please open the call for questions. Thank you. We will now open the floor for the question-and-answer session.
分析師問答
If you would like to ask a question, please press star followed by one on your telephone keypad. That is star followed by one on your telephone keypad. Our first question comes from the line of Matt J. Summerville of D.A. Davidson. Your line is now open.
Hi. Thanks. So maybe just start with the kind of the first half, second half cadence a little bit. But more importantly, maybe if you can dig into some of the pluses and minuses we need to be thinking about with respect to Q1 in particular and maybe kind of frame up, realize you might not want to give specific quarterly guidance, but kind of frame up how we should be thinking about the first quarter. And then maybe if you can quantify the level of organic investment you made in the net service organization in 2025 and what is on tap for 2026? And then I have one more follow-up.
We are starting the year with $733,000,000 in product backlog. Additionally, January was a very strong order entry month for us. So we have really strong visibility into the first half revenues. We have guided our revenue cadence to be approximately 45% in the first half and 55% in the second half, very similar to 2025. On a quarterly basis, we expect our revenues to flow very similar to 2025, with Q1 being approximately 22% of our total revenue for the year. For adjusted EBITDA, we guided to an approximate split of 40% first half and 60% second half, which again is very similar to 2025. In Q1 specifically, we expect adjusted EBITDA margins to be very comparable to 2025, albeit on higher revenue. Regarding the incremental step-up in services investments: our investments in service are primarily comprised of the field service software rollout in North America. That rollout is primarily behind us now, and we are moving to the rest of the world, where the cost of deployment will be slightly lower. We are also in the process of hiring additional field technicians to continue improving our Net Promoter Scores and SLAs. Most of the consolidation of our spares and service facilities is behind us as well. That said, in Q1 those investments will continue, so you will see a slight decrease in service margins into Q1 as we wrap up those investments. Starting in Q2, we expect sequential year-over-year improvement as scale increases and these investments begin to deliver returns. From a service margins perspective, where we ended the year and looking forward to next year, we are expecting to grow them up to 50 basis points. From a product margin perspective, coming off a really good year with about 300 basis points of improvement, we expect to maintain that. We continue to live by our lean culture and see potential for another 25 basis points of improvement as we continue to execute.
Thank you. And then maybe just another quick one. Can you contextualize the retail logo wins in the U.S. a bit? Was that POS driven, software driven, SCO driven? How should we be thinking about the go-forward CAGR for U.S. retail and when it becomes a more consequential piece of the portfolio?
We had nine new logos. I would split them between two very important wins in the grocery space, one very important win in the pharmacy space, and multiple wins in the QSR space where our products match what quick-serve restaurants are looking for. We have a solid pipeline. On the grocery side, one of our largest wins came from one of the targeted accounts we had highlighted, and we are now rolling out our AI software across a limited number of their stores to prove the case in real operations. These rollouts start with a proof of concept, then some DART stores, and then broader store rollouts. AI has played an important role. We were surprised that accounts outside our initial targeted list have come to us, and some wins were driven by point of sale, which validates our modularity strategy and product differentiation. At NRF we had over 800 client and prospect meetings, and we feel very good about the pipeline. Remember that retail is roughly a $1 billion business today, the majority in Europe, but we see the U.S. business growing in the double digits for the foreseeable future. Europe is also strengthening across the year, and we expect continued important wins in self-checkout and growth of our AI-driven platforms.
Thanks, Octavio. Next question comes from the line of Justin Ian Ages of CJS Securities. Your line is now open.
Hi. Morning all. Nice improvement, obviously, in free cash flow. You mentioned days sales and days inventory improving by four and nine days respectively. How much additional improvement do you see left in those metrics? Eventually there will be a lower limit, so trying to triangulate the opportunity that remains. Also, on capital allocation, how are you balancing repurchases, tuck-ins, and the $950,000,000 note? Do you think you will look at refinancing that note in the fourth quarter if it makes sense? And on tuck-ins, is there a set of companies you have your eye on?
This year DSO ended the year at 50. Each day of DSO represents about $10 million of free cash flow for us. We think there's an opportunity for additional improvement, and our thought process entering next year is four to five days of further improvement. Delivering the DSO improvement in Q4 was the result of focused kaizen events to improve service collections and down payments related to service contracts. Regarding DIO, our calculation blends product and services; DIO was down roughly seven days year over year, and each day represents about $7 million. We think there are multiple additional days of improvement available as we continue to scale Lean. Lead times have decreased significantly—from over 120 days a year or two ago to roughly 70 to 80 days now—benefiting from our local-for-local manufacturing in Germany (Paderborn), Canton in the U.S., Manaus in Brazil, and our partner in India. That strategy has helped us unlock value and improve turns.
On capital allocation, we remain consistent with the framework we outlined over a year ago. Share repurchases remain the priority because we believe the stock is undervalued and the company’s ability to generate free cash flow is underappreciated. Last year we returned about 53% of our free cash flow to shareholders despite beginning repurchases in March. We completed the initial $100,000,000 program quickly and then authorized an additional $200,000,000. We plan to continue on a similar, possibly slightly accelerated, timeframe for the $200,000,000 program while maintaining flexibility for tuck-in acquisitions. We have developed a pipeline across multiple categories, primarily focused on services opportunities where we can consolidate and strengthen our footprint. Any M&A would need to be immediately accretive and at a relatively low multiple.
Very helpful. Thank you for taking the question.
We will take our next question from the line of Matt J. Summerville of D.A. Davidson. Your line is now open.
Just to follow up, can you do a regional walk around the world in terms of demand for ATMs? Also, can you speak in more detail about the strength you saw in order activity thus far in 2026?
On ATMs: North America continues to be very strong for us. Initial branch automation wins are significant—the closed cash ecosystem of ATM, teller cash recyclers, and automation software controlling both devices is gaining traction with customers. Recycling is the decided direction for most banks, so investments in recycling capabilities will continue to pay dividends. In North America we are focused on expanding our service footprint into the branch to create a stronger service experience beyond the ATM. In Latin America, which traditionally is a high-growth market, 2025 was a bit lumpier with some project timing, but after Q1 we see very positive momentum and expect that to be a catalyst for growth. Europe showed very positive momentum throughout the year, with strong wins in Germany, particularly in savings and credit union spaces that are in refresh cycles, and solid performance in France amid consolidation of ATM networks. In Asia Pacific and the Middle East, the team delivered great performance with significant wins across several markets. The fit-for-purpose strategy and high-capacity recyclers performed well in key markets. In India, we are now certified to participate in all public government bids, which are typically thousands of devices per bid; this opens a sizable opportunity. Overall, we see steady demand for ATMs and growing interest in moving beyond the ATM into the broader branch ecosystem in our core markets of the U.S. and Europe.
That is helpful. And then, Tom, when do you anticipate completing the remaining $172,000,000 of share repurchases?
I would say in a similar time frame to when we completed the first $100,000,000 program. We would expect to go back to the Board and seek authorization for additional programs and potentially a larger program as well.
We will take our final question from the line of Antoine Legault of Wedbush Securities. Your line is now open.
Good morning, and thank you. On the banking front, the higher mix of recyclers is having a meaningful impact on your banking margins. Could you give a sense of the remaining opportunity to grow the recycler mix? How underpenetrated are those machines, especially as customers refresh and upgrade their ATMs? And then, assuming your EPS guidance range for 2026, can you provide some puts and takes as to what might drive results toward the upper or lower end of that range? What were the parameters that went into your guidance?
Think of this as a continuous cycle. We have been shipping roughly 60,000 to 70,000 machines every year for the past couple of years and do not expect that to materially change. Penetration of recyclers continues to improve annually. We are also ramping up fit-for-purpose machines in parts of Asia, which tend to have a slightly lower margin profile, but we expect to offset that and maintain high overall margins. Lean will continue to uncover opportunities to expand margins year over year.
Regarding EPS guidance: when you remove the two noncash, nonoperational items from 2025, 2025 EPS is closer to $4.51. Drivers for reaching the upper end of our 2026 EPS range include continuation and potential acceleration of our share buyback program and post-tax operating profit. Our EBITDA guidance reflects roughly 8% growth at the midpoint and continues to leverage our operating model to grow EBITDA faster than revenues. Free cash flow momentum from the strong fourth quarter and overall year supports the outlook and will help drive EPS. In short, a combination of operating performance and capital allocation, particularly share repurchases, are the material drivers for EPS performance in 2026.
At this time, we do not have further questions. I would now like to turn the call back to Octavio for his closing remarks.
Thanks, everyone, for joining today’s call and for your interest in Diebold Nixdorf, Incorporated. If you have any follow-up questions after the call, please feel free to reach out to the Investor Relations team. Thanks again, and have a great day.
Thank you for attending today’s call. You may now disconnect.