Net revenues, for the three months ended July 31, 2005, were $125.7 million, an increase of 21% over net revenues of $104.0 million for the comparable period of 2004. The increase was driven by a 36% increase in net revenues from VeriFone's international business and an 11% increase in net revenues in North America. Systems Solutions net revenues rose 20% versus the comparable period of 2004 while Services net revenues rose 27%.

Net income, under generally accepted accounting principles (GAAP), for the three months ended July 31, 2005 was $6.5 million, or $0.10 per diluted share, compared to a loss of ($2.9) million, or ($0.08) per diluted share, for the comparable period of 2004. Net Income as Adjusted, which excludes non-cash amortization of purchased intangibles and debt issuance costs, as well as non-cash stock compensation expense, for the three months ended July 31, 2005 was $13.1 million, or $0.20 per diluted share, compared to $6.0 million, or $0.12 per diluted share, for the comparable period of 2004. A reconciliation of GAAP net income to Net Income as Adjusted is set forth at the end of this press release.

"VeriFone delivered another outstanding quarter. We enjoyed strong revenue growth, as well as year over year and sequential improvement in domestic, international and corporate wide gross margins, as well as EBITDA as Adjusted margins and Net Income as Adjusted margins," said Douglas G. Bergeron, Chairman and Chief Executive Officer. "The market acceptance of our innovative product offerings combined with our ability to exploit favorable industry trends resulted in solid revenue increases in all of our regions worldwide"

Third Quarter Operational Highlights

VeriFone's new Vx Solutions continued to gain traction and amounted to over 40% of international revenue in the third quarter, double the penetration achieved in the second quarter.

In the third quarter we obtained additional Class "A" product certifications with multiple U.S. processors. The products certified represented important milestones for the introduction of Vx Solutions into the U.S.

VeriFone's multi-lane MX870 system, announced in the third quarter, incorporates PIN pad technology and merges full-motion video, a color display, digital quality sound and highly secure payment capabilities into a single, easy-to-use networking system. With this market leading product, multi-lane retailers have a new way to broadcast advertising and corporate messaging directly to their customers.Download the document now 48.8 kb (Adobe Acrobat Document)