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Segment Information and Concentrations
 6 Months Ended
Jun. 30, 2023
Segment Reporting [Abstract]  
SEGMENT INFORMATION AND CONCENTRATIONS 4. SEGMENT INFORMATION AND CONCENTRATIONS
The Company manages and reports its operations in the following segments:

•Retail - We offer software-led solutions to customers in the retail industry, leading with digital to connect retail operations end to end to integrate all aspects of a customer’s operations in indoor and outdoor settings from point-of-sale ("POS"), to payments, inventory management, fraud and loss prevention applications, loyalty and consumer engagement. These solutions include retail-oriented technologies such as comprehensive API-point of sale retail software platforms and applications, hardware terminals, self-service kiosks including self-checkout ("SCO"), payment processing and merchant acquiring solutions, and bar-code scanners.

•Hospitality - We offer technology solutions to customers in the hospitality industry, including table-service, quick-service and fast casual restaurants of all sizes, that are designed to improve operational efficiency, increase customer satisfaction, streamline order and transaction processing and reduce operating costs. Our solutions include POS hardware and software solutions, payment processing and merchant acquiring services, installation, maintenance, as well as managed and professional services.

•Digital Banking - NCR Digital Banking helps financial institutions implement their digital-first platform strategy by providing solutions for account opening, account management, transaction processing, imaging, and branch services to enable financial institutions to offer a compelling customer experience.

•Payments & Network - We provide a cost-effective way for financial institutions, fintechs, and neobanks to reach and serve their customers through our network of automated teller machines ("ATMs") and multi-functioning financial services kiosks. We offer credit unions, banks, digital banks, fintechs, stored-value debit card issuers, and other consumer financial services providers access to our Allpoint retail-based ATM network, providing convenient and fee-free cash withdrawal and deposit access to their customers and cardholders as well as the ability to convert a digital value to cash, or vice versa, via NCRPay360. We also provide ATM branding solutions to financial institutions, ATM management and services to retailers and other businesses, as well as payment processing and merchant acquiring services in the retail, hospitality and other industries.

•Self-Service Banking - We offer solutions to enable customers in the financial services industry to reduce costs, generate new revenue streams and enhance customer loyalty. These solutions include a comprehensive line of ATM hardware and software, and related installation, maintenance, and managed and professional services. We also offer solutions to manage and run the ATM channel end-to-end for financial institutions that includes back office, cash management, software management and ATM deployment, among others.

Corporate and Other includes income and expenses related to corporate functions that are not specifically attributable to an individual reportable segment along with any immaterial operating segment(s).

Eliminations include revenues from contracts with customers and the related costs that are reported in the Payments & Network segment as well as in the Retail or Hospitality segments, including merchant acquiring services that are monetized via payments.

These segments represent components of the Company for which separate financial information is available that is utilized on a regular basis by the chief operating decision maker in assessing segment performance and in allocating the Company's resources. Management evaluates the performance of the segments based on revenue and Adjusted EBITDA. Adjusted EBITDA is defined as GAAP net income (loss) from continuing operations attributable to NCR plus interest expense, net; plus
income tax expense (benefit); plus depreciation and amortization; plus stock-based compensation expense; plus other income (expense); plus pension mark-to-market adjustments, pension settlements, pension curtailments and pension special termination benefits and other special items, including amortization of acquisition-related intangibles, separation-related costs, cyber ransomware incident recovery costs, and transformation and restructuring charges (which includes integration, severance and other exit and disposal costs), among others. The special items are considered non-operational or non-recurring in nature, so are excluded from the Adjusted EBITDA metric utilized by our chief operating decision maker in evaluating segment performance and are separately delineated to reconcile back to total reported GAAP net income (loss) from continuing operations attributable to NCR.

Special Item Related to Russia The war in Eastern Europe and related sanctions imposed on Russia and related actors by the United States and other jurisdictions required us to commence the orderly wind down of our operations in Russia in the first quarter of 2022. As of June 30, 2023, we have ceased operations in Russia and are in the process of dissolving our only subsidiary in Russia. As a result, for the three and six months ended June 30, 2022, our presentation of segment revenue and Adjusted EBITDA exclude the immaterial impact of our operating results in Russia, as well as the impact of impairments taken to write down the carrying value of assets and liabilities, severance charges, and the assessment of collectability on revenue recognition. We recognized a pre-tax net loss of $22 million for the six months ended June 30, 2022 related to these actions, recognized primarily in Cost of products, Cost of services and Selling, general and administrative expenses on the Condensed Consolidated Statement of Operations. No charges have been recognized for the six months ended June 30, 2023. We consider this to be a non-recurring special item and management has reviewed the results of its business segments excluding these impacts.

Assets are not allocated to segments, and thus are not included in the assessment of segment performance. Consequently, we do not disclose total assets by reportable segment. The accounting policies used to determine the results of the operating segments are the same as those utilized for the condensed consolidated financial statements as a whole. Intersegment sales and transfers are not material.
The following table presents revenue and Adjusted EBITDA by segment:
In millionsThree months ended June 30Six months ended June 30
2023202220232022
Revenue by segment
Retail$576 $562 $1,128 $1,108 
Hospitality235 238 458 449 
Digital Banking140 131 276 267 
Payments & Network333 332 656 631 
Self-Service Banking661 679 1,274 1,290 
Total segment revenue$1,945 $1,942 $3,792 $3,745 
Other (1)
54 61 108 129 
Eliminations(13)(12)(23)(20)
Other adjustment (2)
— 6 — 9 
Consolidated revenue$1,986 $1,997 $3,877 $3,863 
Adjusted EBITDA by segment
Retail$123 $104 $220 $171 
Hospitality60 46 113 87 
Digital Banking53 56 102 112 
Payments & Network99 97 182 195 
Self-Service Banking169 142 307 254 
Segment Adjusted EBITDA$504 $445 $924 $819 
(1) Other immaterial business operations that do not represent a reportable segment.
(2) Other adjustment reflects the revenue attributable to the Company's operations in Russia for the three and six months ended June 30, 2022 that were excluded from management's measure of revenue due to our previous announcement to suspend sales to Russia and orderly wind down of our operations in Russia beginning in the first quarter of 2022.
The following table reconciles Segment Adjusted EBITDA to Net income (loss) from continuing operations attributable to NCR:
In millionsThree months ended June 30Six months ended June 30
2023202220232022
Segment Adjusted EBITDA$504 $445 $924 $819 
Less unallocated amounts:
Corporate and other income and expenses not allocated to reportable segments106 98 216 195 
Eliminations9 8 17 14 
Transformation and restructuring costs (1)
(1)49 (1)76 
Acquisition-related amortization of intangibles43 45 85 86 
Acquisition-related costs (2)
1 3 1 8 
Interest expense91 67 174 130 
Interest income(3)(2)(6)(3)
Depreciation and amortization (excluding acquisition-related amortization of intangibles)109 104 215 207 
Income tax expense (benefit)30 — 44 13 
Stock-based compensation expense36 35 68 69 
Separation costs (3)
52 — 71 — 
Cyber ransomware incident recovery costs (4)
11 — 11 — 
Russia— 3 — 22 
Net income (loss) from continuing operations attributable to NCR$20 $35 $29 $2 
(1) Represents integration, severance, and other exit and disposal costs, which are considered non-operational in nature.
(2) Represents professional fees, retention bonuses, and other costs incurred related to acquisitions, which are considered non-operational in nature.
(3) Represents professional fees specific to separation preparation including separation management, organizational design, and legal fees.
(4) Represents expenses to respond to, remediate and investigate the April 13, 2023 cyber ransomware incident, which is considered a non-recurring special item. Additional details regarding this cyber ransomware incident are discussed in Note 1, “Basis of Presentation and Summary of Significant Accounting Policies”.

The following table presents revenue by geography for NCR:
In millionsThree months ended June 30Six months ended June 30
2023202220232022
United States$1,121 $1,075 $2,214 $2,073 
Americas (excluding United States)199 201 381 384 
Europe, Middle East and Africa446 498 858 964 
Asia Pacific220 223 424 442 
Total revenue$1,986 $1,997 $3,877 $3,863 
The following table presents the recurring revenue for NCR:
In millionsThree months ended June 30Six months ended June 30
2023202220232022
Recurring revenue (1)
$1,262 $1,217 $2,491 $2,396 
All other products and services724 780 1,386 1,467 
Total revenue$1,986 $1,997 $3,877 $3,863 

(1) Recurring revenue includes all revenue streams from contracts where there is a predictable revenue pattern that will occur at regular intervals with a relatively high degree of certainty. This includes hardware and software maintenance revenue, cloud revenue, payment processing revenue, interchange and network revenue, Bitcoin-related revenue, and certain professional services arrangements, as well as term-based software license arrangements that include customer termination rights.