Customer data breaches could signal shift in retail hardware spend

NCR has revised its earnings forecast due to challenges in its retail segment, driven partially by the fallout from customer-data security breaches at major retailers. 

According to Moody's Credit Outlook for 27 October, the announcement could herald a shift in spending by retailers as they evaluate data security and their hardware spending decisions in the wake of the customer data breaches publicised by media. 

"This could result in a shift in their capex spending to more secure credit card readers and to enable the technology to accept mobile payments and away from other possible IT upgrades. This would benefit companies such as VeriFone and Ingenico Group, which provide payment terminals, and further delay upgrade orders for the registers, self-checkout consoles and other hardware that NCR sells," noted Gerald Granovsky, Senior Vice President, Moody's.

On the whole however Moody's expects NCR to continue growing its revenue and cash flow, Granovsky added, aided by the strengthening performance of its largest division, financial services, and by operating margin improvements. 

The report can be purchased here.