With its mid-range server business losing money, NCR Corp CEO Lars Nyberg’s been trying to put some positive spin on the company’s outlook although his expectation that ATM sales will pick up and that its ongoing reorganization across product lines from geographic territories won’t be too disruptive doesn’t seem to have set Wall Street alight. It’s going to try and squeeze a few more points from its $2bn maintenance business and get data warehousing into profit, according to Merrill Lynch & Co’s Steve Milunovich. Currently NCR, whose Tower servers once ruled the mid-range roost, is increasingly outsourcing hardware; its eight- way Octascale server unit is supposedly on its way over to Intel Corp. The bank figures both Teradata hardware and NT servers could be outsourced over time. The Teradata business is expected to be around $660m this year growing 20%. Teradata owns the middle to high end of the market for warehouses over 500Gb but faces stiff competition from Oracle, IBM and others in the 150Gb to 500Gb space where NCR badly needs to win the volume orders that can put its warehousing business into profit. Milunovich says research and development funding is being redirected from hardware to software to improve margins. Meantime, its retail terminal business should grow 13% to $484m this year though it’s a low margin market because most revenue is from point-of-sale terminals. NCR says new products, such as self-checkout and electronic price labels will improve profitability. Orders for its financial terminals business – mostly ATMs – is worth $1bn or more and have been growing more than of 20%.
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