Verifone (PAY 18.75, -0.68) has slid 3.5% as cautious guidance for the fourth quarter overshadows in-line results.
The provider of payment and commerce solutions reported in-line earnings of $0.36 per share on a 5.2% year-over-year decline in revenue to $466.90 million, which was just ahead of market expectations.
The company continued divesting non-core businesses during the quarter and made preparations for the launch of the next generation of its products. Gross margin declined to 40.7% from 42.2% one year ago.
Systems revenue fell 6.9% to $266.00 million while Services revenue increased 0.2% to $200.90 million. Through the first nine months of the fiscal year, Systems revenue declined 15.9% to $817.10 million while Services revenue increased 2.5% to $580.40 million.
Looking at the geographical sales breakdown, North American revenue fell 22.0% year-over-year to $152.80 million. Through the first nine months of the fiscal year, North American revenue declined 26.0% to $479.10 million.
Revenue from Latin America jumped 29.4% year-over-year to $71.30 million, exceeding the nine-month growth of 6.2% to $190.80 million. Europe, Middle East, and Africa revenue rose 1.8% to $193.50 million. Through the first nine months of the fiscal year, EMEA revenue declined 3.2% to $539.40 million.
Asia-Pacific revenue decreased 4.3% year-over-year to $49.30 million, which represented a slowdown from a strong start to the year. Through the first nine months of the fiscal year, Asia-Pacific revenue increased 21.9% to $188.20 million.
Looking ahead, Verifone expects fourth quarter earnings of $0.43 per share, which reflects a reduction associated with the divestment of the company's taxi business. Revenue for the fourth quarter is expected between $470 million and $473 million, which is just shy of market expectations. The company noted it expects a return to annual growth in 2018.