DIEBOLD NIXDORF, Inc

Results of Operations. The following discussion of the Company’s financial condition and results of operations provides information that will assist in understanding the financial statements and the changes in certain key items in those financial statements. The following discussion should be read in conjunction with the condensed consolidated financial statements and the accompanying notes that appear elsewhere in this Quarterly Report on Form 10-Q.

(1)The Company calculates constant currency by translating the prior-year period results at the current year exchange rate. The Company calculates constant currency by translating the prior-year period results at the current year exchange rate.

Three months ended June 30, 2025 compared with three months ended June 30, 2024. Net sales decreased $24.5, or 2.6%, including a net favorable currency impact of $19.3 primarily related to the Brazilian real and the euro. After excluding the favorable currency impact, net sales decreased by $43.8. Banking net sales decreased $28.2 or 4.0%, including a net favorable currency impact of $7.5, related primarily to the euro. After excluding the favorable currency impact, net sales decreased $35.7, driven by lower ATM unit sales volume. Banking net sales represented 74.2% and 75.3% of total net sales for the three months ended June 30, 2025 and 2024, respectively. Retail net sales increased $3.7, including a net favorable currency impact of $11.9 primarily related to the euro. After excluding the favorable currency impact, net sales decreased $8.2 primarily due to market headwinds as a result of the current spend environment of retailers. Retail net sales represented 25.8% and 24.7% of total net sales for the three months ended June 30, 2025 and 2024, respectively.

Six months ended June 30, 2025 compared with six months ended June 30, 2024. Net sales decreased $78.8, or 4.3%, including a net unfavorable currency impact of $3.9 primarily related to the Brazilian real and the euro. After excluding the unfavorable currency impact, net sales decreased by $74.9. Banking net sales decreased $47.6 or 3.5%, including a net unfavorable currency impact of $10.8, related primarily to the Brazilian real. After excluding the unfavorable currency impact, and non-recurrence of a $9.7 tax recovery in Brazil, net sales decreased $27.1, driven by lower ATM unit sales volume. Banking net sales represented 74.5% and 73.9% of total net sales for the six months ended June 30, 2025 and 2024, respectively. Retail net sales decreased $31.2, including a net favorable currency impact of $6.8 primarily related to the euro. After excluding the favorable currency impact, net sales decreased $38.0 primarily due to market headwinds as a result of the current spend environment of retailers. Retail net sales represented 25.5% and 26.1% of total net sales for the six months ended June 30, 2025 and 2024, respectively.

Services gross margin decreased 230 and 70 basis points in the three and six months ended June 30, 2025, respectively, primarily due to restructuring, European service operational cost pressures and other cost associated with North America business expansion. Product gross margin increased 260 and 160 basis points in the three and six months ended June 30, 2025, respectively, primarily due to favorable geographic mix of ATM machines in the periods as well as pricing.

Selling and administrative expense increased $2.0 in the three months ended June 30, 2025 compared to the corresponding period in 2024 due to unfavorable currency impact and decreased $7.8 in the six months ended June 30, 2025 compared to the corresponding period in 2024 due to the result of lower spending related to refinancing activities and increased efficiency as a result of continuous improvement initiatives. Research and development costs reflect the Company's ongoing investment in hardware and software innovations and enhancements in service offerings.

Interest expense decreased $16.8 and $38.9 in the three and six months ended June 30, 2025, respectively, due to the refinancing of the Company's debt completed on December 18, 2024. Foreign exchange gain (loss), net includes realized gains and losses, primarily related to the unfavorable impact of a strengthening Brazilian real and euro against the U.S. dollar and a broader weakening of the U.S. dollar during the six months ended June 30, 2025.

Changes in net income were a result of the fluctuations outlined in the previous sections. The change in net income is also impacted by a decrease in income tax expense for the three and six months ended June 30, 2025 compared with the prior year periods. The effective tax rate is significantly lower in 2025 primarily due to (i) improved interest expense deductibility in 2025, and (ii) non-recurring discrete tax expense in 2024 and non-recurring discrete tax benefit in 2025. Refer to Note 3 to our condensed consolidated financial statements for additional information regarding tax expense.