DIEBOLD NIXDORF Inc

Note 1: Basis of Presentation. The accompanying unaudited condensed consolidated financial statements of Diebold Nixdorf, Incorporated and its subsidiaries (collectively, the Company) have been prepared in accordance with the instructions to Form 10-Q and therefore do not include all information and footnotes necessary for a fair presentation of financial position, results of operations and cash flows in conformity with accounting principles generally accepted in the United States (U.S. GAAP); however, such information reflects all adjustments that are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. The Company has reclassified the presentation of certain prior-year information to conform to the current presentation.

The condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. In addition, some of the Company’s statements in this Quarterly Report on Form 10-Q may involve risks and uncertainties that could significantly impact expected future results. The results for interim periods are not necessarily indicative of results for the entire year.

Note 2: Earnings (Loss) Per Share. The following table represents amounts used in computing earnings (loss) per share and the effect on the weighted-average number of shares of potential dilutive common stock:

(1)0.3 and anominal amount of dilutive shares for the three months ended March 31, 2025 and 2024, respectively, are excluded from the shares used in the computation of diluted loss per share due to the net loss position. Shares of 0.5 and 1.1 for the three months ended March 31, 2025 and 2024, respectively, are excluded from the computation of diluted loss per share because the effects are anti-dilutive, irrespective to the net loss position.

Note 3: Income Taxes.

The effective tax rate on the loss from continuing operations was 29.7 percent and 21.8 percent for the three months ended March 31, 2025 and 2024, respectively. The effective tax rate differed compared to the U.S. federal statutory rate due to expected jurisdictional mix of earnings, U.S. tax on foreign income and other expected permanent tax differences relative to pretax earnings, and discrete tax expenses.

Note 4: Inventories. Major classes of inventories are summarized as follows:

Note 5: Goodwill and Other Intangible Assets. The excess of the Company’s reorganization value over the fair value of identified tangible and intangible assets as of the August 11, 2023, the effective date of the Company's 2023 restructuring proceedings is reported separately on the Company’s Condensed Consolidated Statement of Financial Position as goodwill. In accordance with the Company's accounting policy, goodwill and intangibles are tested for impairment annually during the fourth quarter or earlier if a triggering event is identified. The changes in the carrying amount of goodwill for the three months ended March 31, 2025:

The following summarizes information on Intangible assets by major category:

The Company's total amortization expense, excluding that related to deferred financing costs, was $25.4 and 26.4 for the three months ended March 31, 2025 and 2024, respectively.

Note 6: Product Warranties. The Company provides its customers a standard manufacturer’s warranty and records, at the time of the sale, a corresponding estimated liability for potential warranty costs. Estimated future obligations due to warranty claims are based upon historical factors such as labor rates, average repair time, travel time, number of service calls per machine and cost of replacement parts. Changes in the Company’s warranty liability balance are illustrated in the following table:

Note 7: Restructuring. During the fourth quarter of 2023, the Company introduced its continuous improvement initiative, noting that the Company is focused on consistently innovating its solutions to support a better transaction experience for consumers at bank and retail locations while simultaneously streamlining cost structures and business processes through the integration of hardware, software and services. The total expense expected to be incurred in relation to the continuous improvement initiative is $140, which includes $43 and $12 related to our Banking and Retail segments, respectively. The most significant expense for the quarter ended March 31, 2025 primarily relate to transitioning personnel and consultant fees in relation to the improvement process. Total restructuring charges for the quarter ended March 31, 2025 for the Banking and Retail segments were $3.4 and $7.1, respectively. The following tables summarizes the impact of the Company’s restructuring charges on the Consolidated Statements of Earnings (Loss):

The following table summarizes the Company’s severance accrual balance and related activity:

Note 8: Debt. Outstanding debt balances were as follows:

2024 Refinancing Activities- Senior Secured Notes Due 2030 (the 2030 Senior Secured Notes). On December 18, 2024, the Company issued $950.0 in aggregate principal amount 7.75% Senior Secured Notes due 2030 to qualified institutional buyers in a private placement exempt from the registration requirements of the Securities Act of 1933. The 2030 Senior Secured Notes were issued at par.

New Revolving Credit Facility. On December 18, 2024, the Company entered into a new credit agreement (the New Credit Agreement) for a $310.0 revolving credit facility maturing on December 18, 2029 (the Revolving Credit Facility). As of March 31, 2025, no amounts were outstanding under the Revolving Credit Facility.

December 2024 Refinancing. On December 18, 2024, the Company borrowed $70.0 under the Revolving Credit Facility. Proceeds from borrowings under the Revolving Credit Facility, along with proceeds from the issuance of the 2030 Senior Secured Notes and cash on hand were used to (i) to repurchase all of the term loans under the Exit Facility (as defined below), (ii) repay all of the borrowings outstanding under the prior revolving credit facility, and (iii) pay all related premiums, fees, and expenses (collectively, the December 2024 Refinancing).

The December 2024 Refinancing was accounted for as a partial modification, partial extinguishment and new debt issuance at the syndicated lender level. The Company has accounted for $136.6 of the loan principal under the Exit Facility as an extinguishment of debt and $478.8 of the loan principal under the 2030 Senior Secured Notes as issuance of new debt. The remaining loan principal on the Exit Facility was treated as a loan modification. As a result, the Company recorded a loss on the extinguishment of debt in the amount of $7.1. This amount is comprised of the write-off of prior unamortized costs related to the prior revolving credit facility, third-party costs expensed for modified lenders, and penalty fees and lender fees for extinguished lenders of the Exit Facility.

In connection with the December 2024 Refinancing, the Company capitalized $32.2 of lender and third-party costs related to the 2030 Senior Secured Notes, including $0.7 of prior unamortized costs related to the Exit Facility.

The Company incurred $3.9 in lender and third-party fees related to the Revolving Credit Facility. Based on the results of the revolver capacity test performed, the Company capitalized $3.6 of these issuance costs and continued to defer $2.9 of prior unamortized costs from the prior revolving credit facility.

Exit Credit Agreement. On the August 11, 2023, the effective date of the Company's 2023 restructuring proceedings, the Company, as borrower, entered into a credit agreement (the Exit Credit Agreement) governing its $1,250.0 senior secured term loan credit facility (the Exit Facility).

Upon emergence from the 2023 restructuring proceedings, the Company’s then existing $1,250.0 debtor-in-possession term loan credit facility was terminated and the loans outstanding under that facility were converted into loans outstanding under the Exit Facility (the Conversion), and the liens and guarantees, including all guarantees and liens granted by certain subsidiaries of the Company that are organized in the United States and in certain foreign jurisdictions, granted under the prior debtor-in-possession facility were automatically terminated and released. In connection with the Conversion, the entire $1,250.0 under the Exit Facility was deemed drawn on August 11, 2023.

In February 2024, the Company prepaid $200.0 of term loans under the Exit Credit Agreement.

Below is a summary of financing information:

(i)SOFR with a floor of 0.0%

The Company had various international zero interest bearing short-term lines of credit with borrowing limits aggregating to $20.4 and $16.8 as of March 31, 2025 and December 31, 2024. The remaining amount available under the short term uncommitted lines for March 31, 2025 is $19.4. The weighted-average interest rate on outstanding borrowings on the short-term uncommitted lines of credit as of March 31, 2025 was 3.90 percent. There were no outstanding borrowings on the short term lines of credit as of December 31, 2024. Short-term lines mature in less thanone year and are used to support working capital.

Note 9: Accumulated Other Comprehensive Income (Loss). The following table summarizes the changes in the Company’s Accumulated Other Comprehensive Income (AOCI), net of tax, by component for the three months ended March 31, 2025 and 2024:

(1) Other comprehensive income (loss) before reclassifications within the translation component excludes $0.2 and anominal translation amount attributable to noncontrolling interests for the three months ended March 31, 2025 and 2024, respectively.

(2)The total reclassification from AOCI included pension and post-retirement net actuarial gain (loss) of $(0.6) and $5.0, net of tax, for the three months ended March 31, 2025 and 2024, respectively, which affected Miscellaneous, net on the Statement of Earnings (Loss).

Note 10: Fair Value of Assets and Liabilities. Assets and liabilities subject to fair value measurement by fair value level are recorded as follows:

The Company uses the end of period when determining the timing of transfers between levels. During the three months ended March 31, 2025 and 2024, there were no transfers between levels. Debt had a carrying value of $966.0 and fair value of $996.9 at March 31, 2025, and a carrying value of $966.0 and fair value of $987.4 at December 31, 2024. Refer to Note 8 for further details surrounding the Company's debt as of March 31, 2025 compared to December 31, 2024.

Note 11: Commitments and Contingencies. Indirect Tax Contingencies. At March 31, 2025, the Company was a party to several routine indirect tax claims from various taxing authorities globally that were incurred in the normal course of business, which neither individually nor in the aggregate are considered material by management in relation to the Company’s financial position or results of operations. In management’s opinion, the condensed consolidated financial statements would not be materially affected by the outcome of these indirect tax claims and/or proceedings or asserted claims.

Although management believes the Company has valid defenses with respect to its indirect tax positions, it is reasonably possible that a loss could occur in excess of the estimated liabilities. The Company estimated the aggregate risk at March 31, 2025 to be up to $56.1 for its material indirect tax matters. The aggregate risk related to indirect taxes is adjusted as the applicable statutes of limitations expire.

Legal Contingencies. At March 31, 2025, the Company was a party to several lawsuits that were incurred in the normal course of business, which neither individually nor in the aggregate were considered material by management in relation to the Company’s financial position or results of operations. In management’s opinion, the Company's condensed consolidated financial statements would not be materially affected by the outcome of these legal proceedings or asserted claims. Refer to Note 21 of the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 for information about previously reported legal contingencies for which there have been no material developments.

Bank Guarantees, Standby Letters of Credit, and Surety Bonds. At March 31, 2025, the maximum future contractual obligations relative to performance guarantees totaled $107.1, of which $23.8 represented standby letters of credit to insurance providers, andno associated liability was recorded. At December 31, 2024, the maximum future payment obligations relative to these various guarantees totaled $90.4, of which $21.9 represented standby letters of credit to insurance providers, andno associated liability was recorded.

Restricted Cash. The following table provides a reconciliation of Cash, cash equivalents and Short-term and Long-term restricted cash reporting within the Company's Condensed Consolidated Statement of Financial Position and in the Condensed Consolidated Statements of Cash Flows:

The balance of restricted cash at March 31, 2025 primarily relates to requirements of the New Credit Agreement.

Note 12: Revenue Recognition. A performance obligation is a contractual promise to transfer a distinct good or service to the customer. A contract's transaction price is allocated to each distinct performance obligation and is recognized as revenue when (point in time) or as (over time) the performance obligation is satisfied. The following table represents the percentage of revenue recognized either at a point in time or over time:

Contract balances. The following table provides information about receivables and deferred revenue, which represent contract liabilities from contracts with customers:

There have been $1.7 and $4.2 of impairment losses recognized as bad debt related to receivables or contract assets arising from the Company's contracts with customers during the three months ended March 31, 2025 and 2024, respectively.

As of December 31, 2024, the Company had $320.7 of deferred revenue constituting the remaining performance obligations that are unsatisfied (or partially unsatisfied). During the three months ended March 31, 2025, the Company recognized revenue of $101.7 related to the Company's deferred revenue balance at December 31, 2024.

Transaction price allocated to the remaining performance obligations. As of March 31, 2025, the aggregate amount of the transaction price allocated to remaining performance obligations was approximately $1,300. The Company generally expects to recognize revenue on the remaining performance obligations over the next twelve toeighteen months. The Company enters into service agreements with cancellable terms after a certain period without penalty. Unsatisfied obligations reflect only the obligation during the initial term.

Note 13: Segment Information. The Company's reportable segment information below directly aligns with how the Chief Executive Officer, who is also the CODM, regularly reviews results to make decisions, allocate resources, and assess performance. Revenue, costs, operating expenses and operating profit (loss), as disclosed herein, is consistent with the segment information used by the CODM and does not include corporate charges, asset impairment, restructuring and saving initiative charges, or other non-routine, unusual or infrequently occurring items, as the CODM does not regularly review and use such financial measures to make decisions, allocate resources and assess performance.

Segment revenue and cost of sales are from sales to external customers. Segment operating profit is defined as segment gross profit less expenses directly attributable to the segments. The Company does not allocate to its segments certain operating expenses which are managed at the headquarters level; that are not used in the management of the segments, not segment-specific, and impractical to allocate. Segment operating profit reconciles to consolidated loss before income taxes by deducting items that are not attributed to the segments and which are managed independently of segment results. Assets are not allocated to segments, and thus are not included in the assessment of segment performance, and consequently, we do not disclose total assets and depreciation and amortization expense by reportable operating segment.

The following tables present information regarding the Company’s segment performance and provide a reconciliation between segment operating profit and the consolidated Loss before taxes:

(1) Corporate charges not allocated to segments include headquarter-based costs associated primarily with human resources, finance, IT and legal that are not directly attributable to a particular segment and are separately assessed by the CODM for purposes of making decisions.

(2) Refer to Note 7 for further information regarding restructurings. Consistent with the historical reportable segment structure, restructuring and saving initiative costs are not assigned to the segments, and are separately analyzed by the CODM.

(3) Refinancing related costs are fees earned by our advisors that have been accounted for as period expense.

(4) Net non-routine income (expense) consists of items that the Company has determined are non-routine in nature and not allocated to the reportable operating segments as they are not included in the measure used by the CODM to make decisions, allocate resources and assess performance.

The following table presents information regarding the Company’s segment net sales by service and product solution: