Specialist
Former senior executive at Verifone Inc
Agenda
- Verifone’s operating environment and POS (point-of-sale) hardware market dynamics
- Competitive overview – Verifone vs direct peers such as Ingenico (PAR: WLN) and Pax (NASDAQ: PAX)
- Cloud-enabled merchant solutions innovation
- Unit economics across POS hardware and merchant solutions, highlighting Verifone’s transition
- 2022 outlook and revenue mix expectations
Questions
1.
Could you give an overview of Verifone’s operating environment and pull out 2-3 key trends you think investors should be monitoring?
2.
How would you size the present TAM for POS [point-of-sale] terminals across regions, perhaps North America, Europe or APAC? How do you assess market penetration rates?
3.
Could you contextualise the North America TAM in terms of a dollar value or potential growth rate over the next 1-3 years?
4.
What were the main supply chain disruptions at Verifone? Will those alleviate or do you expect lingering issues?
5.
Could you provide some colour on the platforming of Verifone’s legacy system onto the next-generation payment solutions that were built around Android?
6.
Given the transition you mentioned, can you outline Verifone’s competitive landscape and how it’s positioned against immediate peers, perhaps legacy players such as Ingenico or Pax Global or more tech-forward disruptors such as Square or Clover?
7.
What’s Verifone’s competitiveness in Asia, given Pax Global’s presence there?
8.
How is the continued low-cost hardware focus impacting the general pricing trend? Could you comment on ASPs or shipment volumes?
9.
How should investors think about Verifone’s transition from a hardware POS terminal provider to a merchant solutions model? What does a fully realised merchant solutions ecosystem look like for the company, and what structural challenges exist between now and then?
10.
How might the transition affect Verifone’s revenue model and P&L? How should we look at its legacy hardware and terminal sales vs servicing revenue over the next 1-5 years?
11.
How should we frame the impact of this transition on top-line growth prospects for Verifone? Put differently, how does each 1% increase in Verifone’s solutions revenue contribution affect the company’s top-line growth?
12.
What was the driving force behind Verifone’s September 2020 acquisition of 2Checkout and how does it play into Verifone’s ongoing growth strategy?
13.
How would you grade Verifone’s substitution risk amid increased e-commerce adoption across retail?
14.
How should investors think about the current state of Verifone’s restructuring? How is the PE firm balancing some cost-cutting initiatives with a need for investment as it transitions the business towards the merchant solutions platform?
15.
What might be a realistic exit strategy for Verifone given it’s been with the PE firm for just over four years?
16.
How do competitive dynamics differ across customer segments, from tier 1 retailers to the SMBs it seems the tech-forward players and disruptors are really owning?
17.
Do you expect any industry consolidation going forward? Who might be best-positioned for outsized growth or market share gains?
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