NCR CORP MANAGEMENT REPORT OF FINANCIAL POSITION AND OPERATING RESULTS (“MD&A”) (Form 10-Q)

The following discussion should be read in conjunction with the Condensed
Consolidated Financial Statements and notes thereto included under Item 1.
Financial Statements of this Form 10-Q and our Consolidated Financial Statements
and notes thereto and related Management's Discussion and Analysis of Financial
Condition and Results of Operations included in our Annual Report on Form 10-K
for the year ended December 31, 2021 (the "2021 Form 10-K").

Our discussion within the MD&A is organized as follows:

•Overview. This section contains background information on our company, summary
of significant themes and events during the quarter as well as strategic
initiatives and trends in order to provide context for management's discussion
and analysis of our financial condition and results of operations.

•Results of operations. This section contains an analysis of our results of
operations presented in the accompanying condensed consolidated statements of
income by comparing the results for the three and six months ended June 30, 2022
to the results for the three and six months ended June 30, 2021.

•Liquidity and capital resources. This section provides an analysis of our cash flows and a discussion of our contractual obligations as of June 30, 2022.


OVERVIEW

BUSINESS OVERVIEW

NCR Corporation ("NCR", the "Company", "we" or "us") was originally incorporated
in 1884 and is a software- and services-led enterprise technology provider that
runs stores, restaurants and self-directed banking for our customers, which
includes businesses of all sizes. NCR is a global company that is headquartered
in Atlanta, Georgia. Our software platform, which runs in the cloud and includes
microservices and APIs that integrate with our customers' systems, and our
NCR-as-a-Service solutions bring together all of the capabilities and
competencies of NCR to power the technology to run our customers' operations.
Our portfolio includes digital first software and services offerings for
banking, retailers and restaurants, as well as payments processing and networks,
multi-vendor connected device services, automated teller machines ("ATMs"),
self-checkout ("SCO"), point of sale ("POS") terminals and other self-service
technologies. We also resell third-party networking products and provide related
service offerings in the telecommunications and technology sector. Our solutions
are designed to support our transition to becoming a software platform and
payments company.

Effective January 1, 2022, the Company realigned its reportable segments to
correspond with changes to its operating model, management structure and
organizational responsibilities. The reportable segments effective January 1,
2022 include: Payments & Network, Digital Banking, Self-Service Banking, Retail,
and Hospitality.

•Payments & Network - We provide a cost-effective way for financial
institutions, fintechs, and neobanks to reach and serve their customers through
our network of automated teller machines ("ATMs") and multi-functioning
financial services kiosks. We offer credit unions, banks, digital banks,
fintechs, stored-value debit card issuers, and other consumer financial services
providers access to our Allpoint retail-based ATM network, providing convenient
and fee-free cash withdrawal and deposit access to their customers and
cardholders as well as the ability to convert a digital value to cash, or vice
versa, via NCRPay360. We also provide ATM branding, management and services to
financial institutions and businesses.

• Digital Banking – NCR Digital Banking helps financial institutions execute their digital platform strategy by providing solutions for account opening, account management, transaction processing, imaging and services. branch to enable financial institutions to deliver a compelling customer experience.

•Self-Service Banking - We offer solutions to enable customers in the financial
services industry to reduce costs, generate new revenue streams and enhance
customer loyalty. These solutions include a comprehensive line of ATM hardware
and software, and related installation, maintenance, and managed and
professional services.
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•Retail - We offer software-led solutions to customers in the retail industry,
leading with digital to connect retail operations end to end to integrate all
aspects of a customer's operations in indoor and outdoor settings from POS, to
payments, inventory management, fraud and loss prevention applications, loyalty
and consumer engagement. These solutions include retail-oriented technologies
such as comprehensive API-point of sale retail software platforms and
applications, hardware terminals, self-service kiosks including self-checkout
("SCO"), payment processing solutions, and bar-code scanners.

•Hospitality - We offer technology solutions to customers in the hospitality
industry, including table-service, quick-service and fast casual restaurants of
all sizes, that are designed to improve operational efficiency, increase
customer satisfaction, streamline order and transaction processing and reduce
operating costs. Our solutions include POS hardware and software solutions,
installation, maintenance, managed and professional services as well as payment
processing solutions.

Corporate and Other includes income and expenses related to corporate functions
that are not specifically attributable to an individual reportable segment along
with any immaterial operating segment(s).

Eliminations include customer contract revenue and associated costs that are reported in the Payments and Network segment as well as the Retail or Hospitality segments, including merchant acquiring services that are monetized through payments.

NCR's reputation is founded upon over 137 years of providing quality products,
services and solutions to our customers. At the heart of our customer and other
business relationships is a commitment to acting responsibly, ethically and with
the highest level of integrity. This commitment is reflected in NCR's Code of
Conduct, which is available on the Corporate Governance page of our website.
SIGNIFICANT THEMES AND EVENTS

As discussed in more detail in later sections of this MD&A, the following themes and events were material to the second quarter of 2022.

•Revenue of $1,997 million, up 19% compared to the prior year period, and up 23%
excluding unfavorable foreign currency impacts
•Numerous external macro factors, such as rising interest rates, the effects of
the strong U.S. dollar, supply-chain challenges, high component costs, and high
energy prices continue to impact quarterly results


STRATEGIC INITIATIVES AND TRENDS

In order to provide long-term value to all our stakeholders, we set
complementary business goals and financial strategies. NCR is continuing its
transition to become a software platform and payments company with a shift to a
higher level of recurring revenue. Our business goal is to be a leading
enterprise technology provider that runs stores, restaurants and self-directed
banking through our software platform and our NCR-as-a-Service solutions. In
late 2021, we established aspirational five-year financial goals for 2026, which
include annual recurring revenue of 80 percent by 2026, annual earnings per
share (non-GAAP EPS)(1) growth of 15 percent, and annual non-GAAP free cash
flow(1) of $1 billion in 2026. Execution of our goals and strategy is driven by
the following key pillars: (i) focus on our customers; (ii) take care of our
employees; (iii) bring high-quality, innovative products to market; and (iv)
leverage our brand.

As we strive to achieve these aspirational five-year goals, we plan to
capitalize on opportunities presented by the acquisitions of Cardtronics and
LibertyX to accelerate our Payments & Network business as we go to market with a
more robust offering in this segment. We also plan to continue to improve our
execution to drive solid returns and to transform our business to enhance value
for all shareholders.




(1) With respect to our goals of free cash flow and non-GAAP EPS growth, we are
not providing a reconciliation to the respective GAAP measure because we are
unable to predict with reasonable certainty the reconciling items that may
affect GAAP EPS and Cash flow from operations without unreasonable effort. For
our definition of free cash flow, see the Financial Condition, Liquidity and
Capital Resources section within MD&A. For our definition of non-GAAP EPS and
our use of the term annual recurring revenue, see the Key Strategic Financial
Metrics section within MD&A.
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On February 8, 2022, NCR announced that its Board of Directors unanimously
approved commencing a comprehensive strategic review, with the assistance of
outside advisors, which will evaluate a full range of strategic alternatives
available to NCR to enhance value for all shareholders. The Board has not set a
timetable for the conclusion of its review of strategic alternatives. NCR does
not intend to comment further on the strategic review process unless and until
NCR has determined that further disclosure is beneficial or required by law.
Shareholders are advised that there can be no certainty that the strategic
review will result in a transaction, or if a transaction is pursued that such a
transaction will be completed.

Cybersecurity risk management

Similar to most companies, NCR and its customers are subject to more frequent
and increasingly sophisticated cybersecurity attacks. The Company maintains
cybersecurity risk management policies and procedures including disclosure
controls, which it regularly evaluates for updates, for handling and responding
to cybersecurity events. These policies and procedures include internal
notifications and engagements and, as necessary, cooperation with law
enforcement. Personnel involved in handling and responding to cybersecurity
events periodically undertake tabletop exercises to simulate an event. Our
internal notification procedures include notifying the applicable Company
attorneys, which, depending on the level of severity assigned to the event, may
include direct notice to, among others, the Company's General Counsel, Ethics &
Compliance Officer, and Chief Privacy Officer. Company attorneys support efforts
to evaluate the materiality of any incidents, determine whether notice to third
parties such as customers or vendors is required, determine whether any
prohibition on insider trading is appropriate, and assess whether disclosure to
stockholders or governmental filings, including with the SEC, are required. Our
internal notification procedures also include notifying various NCR Information
Technology Services managers, subject matter experts in the Company's software
department and Company leadership, depending on the level of severity assigned
to the event.

Impacts of geopolitical, macroeconomic and COVID-19 challenges

We continue to be exposed to macroeconomic pressures as a result of the
lingering impacts of the COVID-19 pandemic, supply chain challenges, foreign
currency fluctuations, and spikes in commodity and energy prices as a result of
geopolitical challenges, including the war in Eastern Europe. We continue to
navigate through these challenges with a sharp focus on and goal of safeguarding
our employees, helping our customers and managing impacts on our supply chain.
Despite the unprecedented environment, our teams are executing at a high level
and we are advancing our strategy.

The COVID-19 pandemic is complex and continues to evolve. While it is difficult
to project the long-term impact of the pandemic, we expect it will negatively
impact our business at least in the short-term. The ultimate impact on our
overall financial condition and operating results will depend on the currently
unknowable duration and severity of the pandemic, supply chain challenges and
cost escalations including materials, labor and freight, and any additional
governmental and public actions taken in response.

The war in Eastern Europe and related sanctions imposed on Russia and related
actors have resulted in interest rate acceleration and inflation, including, but
not limited to, a significant increase in the price of energy around the world,
particularly in regions such as Europe that are significantly dependent on
Russia for their energy needs, and continued commodity price increases due to
disruption in the mining industry in Ukraine and other factors. The war in
Eastern Europe has also contributed to further disruption in logistics due to
the shipping difficulties in and around the Black Sea and its ports, which have
resulted in the rerouting of traffic to other ports and further logistics
challenges.

We expect that these factors will continue to negatively impact our business at
least in the short-term. The ultimate impact on our overall financial condition
and operating results will depend on the currently unknowable duration and
severity of these activities. We continue to evaluate the long-term impact that
these may have on our business model, however there can be no assurance that the
measures we have taken or will take will completely offset the negative impact.

For further information on the risks posed to our business from the COVID-19
pandemic and other factors, refer to Part I, Item 1A, "Risk Factors", of the
Company's 2021 Form 10-K. For further information on exposures to foreign
exchange risk, refer to Item 3, "Quantitative and Qualitative Disclosures about
Market Risk", in this Form 10-Q.

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Results from Operations

For the three and six months ended June 30, 2022 compared to the three and six months ended June 30, 2021

Consolidated Results

The following tables show our results for the three and six months ended June
30, the relative percentage that those amounts represent to revenue, and the
change in those amounts year-over-year.

                                                Three months ended June 30                       Percentage of Revenue (1)            Increase (Decrease)
In millions                                      2022                  2021                  2022                    2021                 2022 v 2021
Product revenue                            $          614          $     551                     30.7  %                32.9  %                     11  %
Service revenue                                     1,383              1,126                     69.3  %                67.1  %                     23  %
Total revenue                                       1,997              1,677                    100.0  %               100.0  %                     19  %
Product gross margin                                   70                 98                     11.4  %                17.8  %                    (29) %
Service gross margin                                  401                358                     29.0  %                31.8  %                     12  %
Total gross margin                                    471                456                     23.6  %                27.2  %                      3  %
Selling, general and administrative
expenses                                              309                303                     15.5  %                18.1  %                      2  %
Research and development expenses                      59                 69                      3.0  %                 4.1  %                    (14) %

Income from operations                     $          103          $      84                      5.2  %                 5.0  %                     23  %



                                                Six months ended June 30                       Percentage of Revenue (1)            Increase (Decrease)
In millions                                      2022                2021                  2022                    2021                 2022 v 2021
Product revenue                            $       1,130          $  1,033                     29.3  %                32.1  %                      9  %
Service revenue                                    2,733             2,188                     70.7  %                67.9  %                     25  %
Total revenue                                      3,863             3,221                    100.0  %               100.0  %                     20  %
Product gross margin                                  94               172                      8.3  %                16.7  %                    (45) %
Service gross margin                                 788               698                     28.8  %                31.9  %                     13  %
Total gross margin                                   882               870                     22.8  %                27.0  %                      1  %
Selling, general and administrative
expenses                                             622               541                     16.1  %                16.8  %                     15  %
Research and development expenses                    124               135                      3.2  %                 4.2  %                     (8) %

Income from operations                     $         136          $    194                      3.5  %                 6.0  %                    (30) %



(1) The percentage of revenue is calculated for each line item divided by total
revenue, except for product gross margin and service gross margin, which are
divided by the related component of revenue.




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Key Strategic Financial Metrics

The following tables show our key strategic financial metrics for the three and
six months ended June 30, the relative percentage that those amounts represent
to total revenue, and the change in those amounts year-over-year.

Recurring revenue as a percentage of total revenue

                                              Three months ended June 30                     Percentage of Total Revenue           Increase (Decrease)
In millions                                     2022                 2021                  2022                   2021                 2022 v 2021
   Recurring revenue (1)                  $        1,217          $    929                     60.9  %               55.4  %                     31  %
   All other products and services                   780               748                     39.1  %               44.6  %                      4  %
Total Revenue                             $        1,997          $  1,677                      100  %                100  %                     19  %



                                               Six months ended June 30                      Percentage of Total Revenue           Increase (Decrease)
In millions                                     2022                2021   
              2022                    2021                 2022 v 2021
   Recurring revenue (1)                  $       2,396          $  1,803                     62.0  %                56.0  %                     33  %
   All other products and services                1,467             1,418                     38.0  %                44.0  %                      3  %
Total Revenue                             $       3,863          $  3,221                    100.0  %               100.0  %                     20  %



(1) Recurring revenue includes all revenue streams from contracts where there is
a predictable revenue pattern that will occur at regular intervals with a
relatively high degree of certainty. This includes hardware and software
maintenance revenue, cloud revenue, payment processing revenue, interchange and
network revenue, and certain professional services arrangements as well as
term-based software license arrangements that include customer termination
rights.

Net income (loss) from continuing operations and adjusted EBITDA as a percentage of total revenue

                                             Three months ended June 30                     Percentage of Total Revenue           Increase (Decrease)
In millions                                    2022                 2021                  2022                   2021                 2022 v 2021
Net income (loss) from continuing
operations attributable to NCR           $           35          $     (9)                     1.8  %               (0.5) %                    489  %
Adjusted EBITDA                          $          339          $    281                     17.0  %               16.8  %                     21  %



                                              Six months ended June 30                     Percentage of Total Revenue           Increase (Decrease)
In millions                                    2022                2021                  2022                   2021                 2022 v 2021
Net income (loss) from continuing
operations attributable to NCR           $           2          $     21                      0.1  %                0.7  %                    (90) %
Adjusted EBITDA                          $         610          $    539                     15.8  %               16.7  %                     13  %




Non-GAAP Financial Measures and Use of Certain Terms:

The term "annual recurring revenue" is recurring revenue, excluding software
license sold as a subscription, for the last three months times four, plus the
rolling four quarters for term-based software license arrangements that include
customer termination rights.


Non-GAAP Earnings per Share ("Non-GAAP EPS") NCR's non-GAAP EPS is determined by
excluding, as applicable, pension mark-to-market adjustments, pension
settlements, pension curtailments and pension special termination benefits, as
well as other special items, including amortization of acquisition related
intangibles and transformation and restructuring activities, from NCR's GAAP
earnings per share. Due to the non-operational nature of these pension and other
special items, NCR's management uses this non-GAAP measure to evaluate
year-over-year operating performance. NCR believes this
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The TOC measurement is useful for investors because it provides a more complete understanding of NCR’s underlying operating performance, as well as consistency and comparability with NCR’s past reports of financial results.

Constant Currency NCR presents certain financial measures, such as
period-over-period revenue growth, on a constant currency basis, which excludes
the effects of foreign currency translation by translating prior period results
at current period monthly average exchange rates. Due to the overall variability
of foreign exchange rates from period to period, NCR's management uses constant
currency measures to evaluate period-over-period operating performance on a more
consistent and comparable basis. NCR's management believes that presentation of
financial measures without this result may contribute to an understanding of the
Company's period-over-period operating performance and provides additional
insight into historical and/or future performance, which may be helpful for
investors.


Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization
("Adjusted EBITDA") NCR's management uses the non-GAAP measure Adjusted EBITDA
because it provides useful information to investors as an indicator of strength
and performance of the Company's ongoing business operations, including funding
discretionary spending such as capital expenditures, strategic acquisitions, and
other investments. NCR determines Adjusted EBITDA based on GAAP net income
(loss) from continuing operations attributable to NCR plus interest expense,
net; plus income tax expense (benefit); plus depreciation and amortization; plus
stock-based compensation expense; plus other income (expense); plus pension
mark-to-market adjustments, pension settlements, pension curtailments and
pension special termination benefits and other special items, including
amortization of acquisition-related intangibles and restructuring charges, among
others. Refer to the table below for the reconciliations of net income (loss)
from continuing operations attributable to NCR (GAAP) to Adjusted EBITDA
(non-GAAP).


Special Item Related to Russia The war in Eastern Europe and related sanctions
imposed on Russia and related actors by the United States and other
jurisdictions required us to commence the orderly wind down of our operations in
Russia beginning in the first quarter of 2022. As of June 30, 2022, we have
substantially ceased operations in Russia and are in the process of dissolving
our only subsidiary in Russia. As a result, for the three and six months ended
June 30, 2022, our non-GAAP presentation of the measures described above exclude
the immaterial impact of our operating results in Russia, as well as the impact
of impairments taken to write down the carrying value of assets and liabilities,
severance charges, and the assessment of collectability on revenue recognition.
We consider this to be a non-recurring special item and management has reviewed
the results of its business segments excluding these impacts. We have not
adjusted the presentation of the prior year periods due to the immaterial impact
of Russia to revenue and income from continuing operations for the three and six
months ended June 30, 2021.

NCR's definitions and calculations of these non-GAAP measures may differ from
similarly-titled measures reported by other companies and cannot, therefore, be
compared with similarly-titled measures of other companies. These non-GAAP
measures should not be considered as substitutes for, or superior to, results
determined in accordance with GAAP.

                                                       Three months ended June 30                 Six months ended June 30
In millions                                              2022                 2021                 2022                2021
Net income (loss) from continuing operations
attributable to NCR (GAAP)                         $           35          $     (9)         $           2          $     21

Transformation and restructuring costs                         49                 7                     76                15
Acquisition-related amortization of intangibles                45                23                     86                43
Acquisition-related costs                                       3                56                      8                83

Interest expense                                               67                61                    130               106
Interest income                                                (2)               (1)                    (3)               (4)
Depreciation and amortization (excluding
acquisition-related amortization of intangibles)              104                76                    207               146
Income taxes                                                    -                31                     13                48
Stock-based compensation expense                               35                37                     69                81
Russia                                                          3                 -                     22                 -
Adjusted EBITDA (non-GAAP)                         $          339          $    281          $         610          $    539





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Revenue

                                               Three months ended June 30                      Percentage of Total Revenue           Increase (Decrease)
In millions                                      2022                 2021                  2022                    2021                2022 vs 2021
Product revenue                            $          614          $    551                     30.7  %                32.9  %                     11  %
Service revenue                                     1,383             1,126                     69.3  %                67.1  %                     23  %
Total revenue                              $        1,997          $  1,677                    100.0  %               100.0  %                     19  %



                                                Six months ended June 30                      Percentage of Total Revenue           Increase (Decrease)
In millions                                      2022                2021                  2022                    2021                2022 vs 2021
Product revenue                            $       1,130          $  1,033                     29.3  %                32.1  %                      9  %
Service revenue                                    2,733             2,188                     70.7  %                67.9  %                     25  %
Total revenue                              $       3,863          $  3,221                    100.0  %               100.0  %                     20  %



Product revenue includes our hardware and software license revenue streams as
well as cryptocurrency-related revenues. Service revenue includes hardware and
software maintenance revenue, implementation services revenue, cloud revenue,
payments processing revenue, interchange and network revenue, as well as
professional services revenue.

For the three and six months ended June 30, 2022 compared to the three and six months ended June 30, 2021

The second quarter 2021 results include the operations of Cardtronics from the
date of acquisition, June 21, 2021, to June 30, 2021. As a result, revenue for
the three and six months ended June 30, 2021 includes $32 million from
Cardtronics.

Total revenue increased 19% for the three months ended June 30, 2022 compared to
the three months ended June 30, 2021. Foreign currency fluctuations had an
unfavorable impact of 4% on the revenue comparison. Product revenue for the
three months ended June 30, 2022 increased 11% compared to the three months
ended June 30, 2021 due to growth in POS and ATM revenue as well as the addition
of cryptocurrency revenue following the acquisition of LibertyX in January 2022,
partially offset by a decline in SCO hardware revenue. Service revenue for the
three months ended June 30, 2022 increased 23% compared to the prior year period
due to growth in software related services, which includes the results of
Cardtronics.

Total revenue increased 20% for the six months ended June 30, 2022 compared to
the six months ended June 30, 2021. Foreign currency fluctuations had an
unfavorable impact of 3% on the revenue comparison. Product revenue for the six
months ended June 30, 2022 increased 9% compared to the six months ended June
30, 2021 due to growth in POS revenue as well as the addition of cryptocurrency
revenue following the acquisition of LibertyX in January 2022, partially offset
by a decline in ATM and SCO hardware revenue. Service revenue for the six months
ended June 30, 2022 increased 25% compared to the six months ended June 30, 2021
due to growth in software related services, which includes the results of
Cardtronics.



Gross Margin
                                                   Three months ended June 30                      Percentage of Revenue (1)            Increase (Decrease)
In millions                                          2022                 2021                  2022                   2021                 2022 v 2021
Product gross margin                           $           70          $     98                     11.4  %               17.8  %                    (29) %
Service gross margin                                      401               358                     29.0  %               31.8  %                     12  %
Total gross margin                             $          471          $    456                     23.6  %               27.2  %                      3  %

(1) The percentage of turnover is calculated for each item divided by the corresponding component of turnover.

For the three months ended June 30, 2022 compared to the three months ended June 30, 2021

Gross margin as a percentage of sales during the three months ended June 30, 2022
was 23.6% compared to 27.2% during the quarter ended June 30, 2021. Gross margin during the three months ended June 30, 2022 included $16 million processing costs, $27 million amortization of intangible assets related to acquisitions, $1 million acquisition-related costs, partially offset

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by profit of $4 million related to collections and inventory liquidation in
Russia. Gross margin for the three months ended June 30, 2021 included $7
million of transformation and restructuring costs and $9 million of amortization
of acquisition-related intangible assets. Excluding these items, gross margin as
a percentage of revenue decreased from 28.1% to 25.7% due to increases in fuel
costs, component parts, and interest rates on vault cash agreements as well as
other supply chain challenges that continued to negatively impact our costs. The
impact of these cost increases were partially offset by cost mitigation actions
implemented and an increase in the favorable higher margin software and services
revenue.

                                                    Six months ended June 30                      Percentage of Revenue (1)            Increase (Decrease)
In millions                                          2022                2021                  2022                   2021                 2022 v 2021
Product gross margin                           $          94          $    172                      8.3  %               16.7  %                    (45) %
Service gross margin                                     788               698                     28.8  %               31.9  %                     13  %
Total gross margin                             $         882          $    870                     22.8  %               27.0  %                      1  %


For the six months ended June 30, 2022 compared to the half-year ended June 30, 2021

Gross margin as a percentage of revenue in the six months ended June 30, 2022
was 22.8% compared to 27.0% in the six months ended June 30, 2021. Gross margin
in the six months ended June 30, 2022 included $21 million of transformation
costs, $46 million of amortization of acquisition-related intangible assets, $1
million of acquisition-related costs, and $10 million related to operating
losses, impairments and other actions taken with respect to our operations in
Russia. Gross margin for the six months ended June 30, 2021 included $11 million
of transformation costs and $16 million of amortization of acquisition-related
intangible assets. Excluding these items, gross margin as a percentage of
revenue decreased from 27.8% to 24.9% due to increases in fuel costs, component
parts, and interest rates as well as other supply chain challenges that
negatively impacted our costs. The impact of these cost increases were partially
offset by cost mitigation actions implemented, employee retention credits, and
an increase in the favorable higher margin software and services revenue.

Selling, general and administrative expenses

                                              Three months ended June 30                     Percentage of Total Revenue           Increase (Decrease)
In millions                                     2022                 2021                  2022                   2021                2022 vs 2021
Selling, general and administrative
expenses                                  $          309          $    303                     15.5  %               18.1  %                      2  %


For the three months ended June 30, 2022 compared to the three months ended June 30, 2021

Selling, general, and administrative expenses were $309 million compared to $303
million in the three months ended June 30, 2022 and 2021, respectively. As a
percentage of revenue, selling, general and administrative expenses were 15.5%
compared to 18.1% in the three months ended June 30, 2022 and 2021,
respectively. In the three months ended June 30, 2022, selling, general and
administrative expenses included $25 million of transformation costs, $18
million of amortization of acquisition-related intangible assets, $2 million of
acquisition-related costs and $2 million of costs related to actions taken with
respect to our operations in Russia. In the three months ended June 30, 2021,
selling, general and administrative expenses primarily included $14 million of
amortization of acquisition-related intangible assets and $59 million of
acquisition-related costs. Excluding these items, selling, general and
administrative expenses decreased slightly as a percentage of revenue from 13.7%
to 13.2% primarily due to cost mitigation actions implemented.

                                               Six months ended June 30                     Percentage of Total Revenue           Increase (Decrease)
In millions                                     2022                2021                  2022                   2021                2022 vs 2021
Selling, general and administrative
expenses                                  $         622          $    541                     16.1  %               16.8  %                     15  %


For the six months ended June 30, 2022 compared to the half-year ended June 30, 2021

Selling, general, and administrative expenses were $622 million compared to $541
million in the six months ended June 30, 2022 and 2021, respectively. As a
percentage of revenue, selling, general and administrative expenses were 16.1%
compared to 16.8% in the six months ended June 30, 2022 and 2021, respectively.
In the six months ended June 30, 2022, selling, general and administrative
expenses included $46 million of transformation costs, $40 million of
amortization of acquisition-related
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intangible assets, $7 million of acquisition-related costs and $6 million of
costs related to actions taken with respect to our operations in Russia. In the
six months ended June 30, 2021, selling, general and administrative expenses
included $3 million of transformation and restructuring costs, $27 million of
amortization of acquisition-related intangible assets, and $69 million of
acquisition-related costs. Excluding these items, selling, general and
administrative expenses decreased slightly as a percentage of revenue from 13.7%
to 13.6%.

Research and development costs

                                            Three months ended June 30                     Percentage of Total Revenue          Increase (Decrease)
In millions                                   2022                 2021                  2022                   2021                2022 v 2021
Research and development expenses       $           59          $     69                      3.0  %               4.1  %                    (14) %



For the three months ended June 30, 2022 compared to the three months ended June 30, 2021

Research and development expenses were $59 million compared to $69 million in
the three months ended June 30, 2022 and 2021, respectively. As a percentage of
revenue, these costs were 3.0% and 4.1% in the three months ended June 30, 2022
and 2021, respectively. In the three months ended June 30, 2022, research and
development expenses included $8 million of transformation costs. In the three
months ended June 30, 2021, research and development expenses included $1
million of transformation benefits. After considering this item, research and
development expenses decreased as a percentage of revenue from 4.2% to 2.6% due
to cost-mitigation actions implemented and an increase in revenue year over
year.

                                             Six months ended June 30                     Percentage of Total Revenue          Increase (Decrease)
In millions                                   2022                2021                  2022                   2021                2022 v 2021

Research and development costs $124 $135

                  3.2  %               4.2  %                     (8) %



For the six months ended June 30, 2022 compared to the half-year ended June 30, 2021

Research and development expenses were $124 compared to $135 in the six months
ended June 30, 2022 and 2021, respectively. As a percentage of revenue, these
costs were 3.2% and 4.2% in the six months ended June 30, 2022 and 2021,
respectively. In the six months ended June 30, 2022, research and development
expenses included $9 million of transformation costs. In the six months ended
June 30, 2021, research and development expenses included $1 million of
transformation costs. After considering this item, research and development
expenses decreased as a percentage of revenue from 4.2% to 3.0% due to an
increase in revenue year over year and cost mitigation actions implemented.

Interest Expense

                               Three months ended June 30              Increase (Decrease)
In millions                          2022                    2021          2022 v 2021
Interest expense      $           67                        $ 61                      10  %


For the three months ended June 30, 2022 compared to the three months ended June 30, 2021

Interest expense was $67 million compared to $61 million in the three months
ended June 30, 2022 and 2021, respectively. Interest expense is primarily
related to the Company's senior unsecured notes and borrowings under the
Company's Senior Secured Credit Facility. The main driver was related to the
increase in interest rates on the Senior Secured Credit Facility partially
offset by lower average outstanding principal balances.





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                              Six months ended June 30             Increase (Decrease)
In millions                       2022                  2021           2022 v 2021
Interest expense      $         130                    $ 106                      23  %


For the six months ended June 30, 2022 compared to the half-year ended June 30, 2021

Interest expense was $130 million compared to $106 million in the six months
ended June 30, 2022 and 2021, respectively. Interest expense is primarily
related to the Company's senior unsecured notes and borrowings under the
Company's Senior Secured Credit Facility. The main driver was related to the
increase in total outstanding debt as a result of the closing of the acquisition
of Cardtronics in the second quarter of 2021, combined with an increase in
interest rates on the Senior Secured Credit Facility.

Other income (expenses), net

Other income (expense), net was income of $1 million and expense of $1 million
in the three months ended June 30, 2022 and 2021, respectively, and income of
$10 million and expense of $18 million in the six months ended June 30, 2022 and
2021, respectively, with the components reflected in the following table:

                                                    Three months ended June 30               Six months ended June 30
In millions                                          2022                 2021                2022                2021
Interest income                                 $          2          $       1          $         3          $       4
Foreign currency fluctuations and foreign
exchange contracts                                        (7)                (3)                  (7)                (7)
Bank-related fees                                         (3)                (2)                  (5)               (21)
Employee benefit plans                                    10                  3                   21                  6
Other, net                                                (1)                 -                   (2)                 -
Other income (expense), net                     $          1          $      (1)         $        10          $     (18)



Employee benefit plans within Other income (expense), net includes the
components of pension, postemployment and postretirement expense, other than
service cost. The increase in Employee benefit plans in 2022 compared to the
prior year period is primarily related to actuarial gains related to the pension
plans that are being amortized throughout the year. In the six months ended June
30, 2021, the Company incurred bank-related fees of $19 million related to
certain structuring and commitment fees as a result of the financing
transactions entered into during the first quarter of 2021 related to the
transaction with Cardtronics.

Income taxes

                                           Three months ended June 30                 Six months ended June 30
In millions                                 2022                 2021                 2022                 2021
Income tax expense (benefit)          $           -          $       31          $         13          $       48


For the three months ended June 30, 2022 compared to the three months ended June 30, 2021

Income tax provisions for interim (quarterly) periods are based on an estimated
annual effective income tax rate calculated separately from the effect of
significant, infrequent or unusual items. Income tax expense was approximately
zero for the three months ended June 30, 2022 compared to $31 million income tax
expense for the three months ended June 30, 2021. The change was primarily
driven by discrete tax expenses and benefits. In the three months ended June 30,
2022 the Company recognized a $6 million benefit from provision to return
adjustments and a $7 million benefit related to uncertain tax position
settlements and statute of limitation lapses. In the three months ended June 30,
2021, the Company recognized a $34 million expense from recording a valuation
allowance against interest limitation carryforwards in the U.S. and a $14
million benefit from the deferred tax impact of a tax law change enacted in the
U.K.

For the six months ended June 30, 2022 compared to the half-year ended June 30, 2021

The income tax expense was $13 million for the six months ended June 30, 2022
compared to the expenses of $48 million for the six months ended June 30, 2021. The variation is mainly attributable to lower pre-tax earnings and discrete tax charges and benefits. In the six months ended June 30, 2022the Company recognized a $4 million benefit from a return clause

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adjustments and a $7 million benefit related to uncertain tax position
settlements and statute of limitation lapses. In the six months ended June 30,
2021, the Company recognized a $34 million expense from recording a valuation
allowance against interest limitation carryforwards in the U.S. and a $14
million benefit from the deferred tax impact of a tax law change in the U.K.

The Company is subject to numerous federal, state and foreign tax audits. While
we believe that appropriate reserves exist for issues that might arise from
these audits, should these audits be settled, the resulting tax effect could
impact the tax provision and cash flows in 2022 or future periods.

Profit (loss) from discontinued operations

The Company recognized income from discontinued operations, net of tax, of $6
million and $5 million in the three and six months ended June 30, 2022,
respectively. The income from discontinued operations, net of tax, was primarily
driven by insurance recoveries partially offset by immaterial updates to various
environmental remediation matters. In the three and six months ended June 30,
2021, there was no activity related to discontinued operations.


Revenue and adjusted EBITDA by segment

The Company manages and reports its businesses in the following segments:
Payments & Network, Digital Banking, Self-Service Banking, Retail, and
Hospitality. Segments are measured for profitability by the Company's chief
operating decision maker based on revenue and segment Adjusted EBITDA. Adjusted
EBITDA is defined as GAAP net income (loss) from continuing operations
attributable to NCR plus interest expense, net; plus income tax expense
(benefit); plus depreciation and amortization; plus stock-based compensation
expense; plus other income (expense); plus pension mark-to-market adjustments,
pension settlements, pension curtailments and pension special termination
benefits and other special items, including amortization of acquisition-related
intangibles, restructuring charges, among others. The special items are
considered non-operational so are excluded from the Adjusted EBITDA metric
utilized by our chief operating decision maker in evaluating segment performance
and are separately delineated to reconcile back to total reported income (loss)
from continuing operations attributable to NCR. This format is useful to
investors because it allows analysis and comparability of operating trends. It
also includes the same information that is used by NCR management to make
decisions regarding the segments and to assess our financial performance.

Corporate and Other includes income and expenses related to corporate functions
that are not specifically attributable to an individual reportable segment along
with any immaterial operating segment(s).

Special Item Related to Russia The war in Eastern Europe and related sanctions
imposed on Russia and related actors by the United States and other
jurisdictions required us to commence the orderly wind down of our operations in
Russia beginning in the first quarter of 2022. As of June 30, 2022, we have
substantially ceased operations in Russia and are in the process of dissolving
our only subsidiary in Russia. As a result, for the three and six months ended
June 30, 2022, our non-GAAP presentation of the measures described above exclude
the immaterial impact of our operating results in Russia, as well as the impact
of impairments taken to write down the carrying value of assets and liabilities,
severance charges, and the assessment of collectability on revenue recognition.
We consider this to be a non-recurring special item and management has reviewed
the results of its business segments excluding these impacts. We have not
adjusted the presentation of the prior year periods due to the immaterial impact
of Russia to revenue and income from continuing operations for the three and six
months ended June 30, 2021.














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The following tables show our segment revenue and Adjusted EBITDA for the three
and six months ended June 30, the relative percentage that those amounts
represent to segment revenue, and the change in those amounts year-over-year.

                                                                                                                            Increase             Increase (Decrease)
                                      Three months ended June 30                  Percentage of Revenue (1)                (Decrease)             Constant Currency
In millions                             2022              2021                2022                    2021                2022 v 2021                2022 v 2021
Revenue
Payments & Network                   $    332          $    54                    16.7  %                 3.2  %                   515  %                      526  %
Digital Banking                           131              129                     6.6  %                 7.7  %                     2  %                        2  %
Self-Service Banking                      679              645                    34.1  %                38.5  %                     5  %                        9  %
Retail                                    562              562                    28.2  %                33.5  %                     -  %                        4  %
Hospitality                               238              215                    11.9  %                12.8  %                    11  %                       11  %
Other                                      61               77                     3.1  %                 4.6  %                   (21) %                      (19) %
Eliminations (2)                          (12)              (5)                   (0.6) %                (0.3) %                   140  %                      140  %
Total segment revenue                $  1,991          $ 1,677                   100.0  %                 100  %                    19  %                       22  %
Other adjustment (3)                        6                -
Total revenue                        $  1,997          $ 1,677                                                                      19  %                       23  %

Adjusted EBITDA by Segment
Payments & Network                   $     97          $    19                    29.2  %                35.2  %                   411  %
Digital Banking                            56               55                    42.7  %                42.6  %                     2  %
Self-Service Banking                      142              140                    20.9  %                21.7  %                     1  %
Retail                                    104              121                    18.5  %                21.5  %                   (14) %
Hospitality                                46               39                    19.3  %                18.1  %                    18  %
Corporate and Other                       (98)             (89)                 (160.7) %              (115.6) %                    10  %
Eliminations (2)                           (8)              (4)                   66.7  %                80.0  %                   100  %
Total Adjusted EBITDA                $    339          $   281                    17.0  %                16.8  %                    21  %



(1) The percentage of revenue is calculated for each line item divided by total
revenue, except for Adjusted EBITDA, which are divided by the related component
of revenue.
(2) Eliminations include revenues from contracts with customers and the related
costs that are reported in the Payments & Network segment as well as in the
Retail or Hospitality segments, including merchant acquiring services that are
monetized via payments.
(3) Other adjustment reflects the revenue attributable to the Company's
operations in Russia for the three months ending June 30, 2022 that was excluded
from management's measure of revenue due to our announcement to suspend sales to
Russia and anticipated orderly wind down of our operations in Russia. The
revenue attributable to the Russian operations for the prior period of $11
million is included in the respective segments.

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                                                                                                                                 Increase             Increase (Decrease)
                                         Six months ended June 30                      Percentage of Revenue (1)                (Decrease)             Constant Currency
In millions                                2022                2021                2022                    2021                2022 v 2021                2022 v 2021
Revenue
Payments & Network                   $         631          $    76                    16.4  %                 2.4  %                   730  %                      741  %
Digital Banking                                267          $   252                     6.9  %                 7.8  %                     6  %                        6  %
Self-Service Banking                         1,290          $ 1,273                    33.5  %                39.5  %                     1  %                        4  %
Retail                                       1,108          $ 1,082                    28.7  %                33.6  %                     2  %                        6  %
Hospitality                                    449          $   394                    11.7  %                12.2  %                    14  %                       15  %
Other                                          129          $   154                     3.3  %                 4.8  %                   (16) %                      (13) %
Eliminations (2)                               (20)         $   (10)                   (0.5) %                (0.3) %                   100  %                      100  %
Total segment revenue                $       3,854          $ 3,221                     100  %               100.0  %                    20  %                       23  %
Other adjustment (3)                             9                -
Total revenue                        $       3,863          $ 3,221                                                                      20  %                       23  %

Adjusted EBITDA by Segment
Payments & Network                   $         195          $    22                    30.9  %                28.9  %                   786  %
Digital Banking                                112              109                    41.9  %                43.3  %                     3  %
Self-Service Banking                           254              277                    19.7  %                21.8  %                    (8) %
Retail                                         171              219                    15.4  %                20.2  %                   (22) %
Hospitality                                     87               75                    19.4  %                19.0  %                    16  %
Corporate and Other                           (195)            (156)                 (151.2) %              (101.3) %                    25  %
Eliminations (2)                               (14)              (7)                   70.0  %                70.0  %                   100  %
Total Adjusted EBITDA                $         610          $   539                    15.8  %                16.7  %                    13  %



(1) The percentage of revenue is calculated for each line item divided by total
revenue, except for Adjusted EBITDA, which are divided by the related component
of revenue.
(2) Eliminations include revenues from contracts with customers and the related
costs that are reported in the Payments & Network segment as well as in the
Retail or Hospitality segments, including merchant acquiring services that are
monetized via payments.
(3) Other adjustment reflects the revenue attributable to the Company's
operations in Russia for the six months ending June 30, 2022 that were excluded
from management's measure of revenue due to our announcement to suspend sales to
Russia and anticipated orderly wind down of our operations in Russia. The
revenue attributable to the Russian operations for the prior period of $19
million is included in the respective segments.

The following table provides a reconciliation of segment and total revenue percentage growth (GAAP) to constant currency (non-GAAP) revenue percentage growth for the three and six months ended June 30, 2022.

                                                                  Three months ended June 30, 2022                                                

Six months ended June 30, 2022

                                                                          Favorable                Revenue Growth %                                      Favorable                Revenue Growth %
                                              Revenue Growth           (Unfavorable) FX            Constant Currency         Revenue Growth           (Unfavorable) FX            Constant Currency
$ in millions                                    % (GAAP)                   Impact                    (non-GAAP)                % (GAAP)                   Impact                    (non-GAAP)
Payments & Network                                     515  %                       (11) %                      526  %                730  %                       (11) %                      741  %
Digital Banking                                          2  %                         -  %                        2  %                  6  %                         -  %                        6  %
Self-Service Banking                                     5  %                        (4) %                        9  %                  1  %                        (3) %                        4  %
Retail                                                   -  %                        (4) %                        4  %                  2  %                        (4) %                        6  %
Hospitality                                             11  %                         -  %                       11  %                 14  %                        (1) %                       15  %
Other                                                  (21) %                        (2) %                      (19) %                (16) %                        (3) %                      (13) %
Eliminations                                           140  %                         -  %                      140  %                100  %                         -  %                      100  %
Total segment revenue                                   19  %                        (3) %                       22  %                 20  %                        (3) %                       23  %

Total revenue                                           19  %                        (4) %                       23  %                 20  %                        (3) %                       23  %



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Segment Revenue

For the three and six months ended June 30, 2022 compared to the three and six months ended June 30, 2021

Payments & Network revenue increased significantly for the three and six months
ended June 30, 2022 compared to the prior year periods, primarily due to
additional payments processing revenue from the acquisition of Cardtronics,
which occurred on June 21, 2021. Additionally, the three and six months ended
June 30, 2022 includes cryptocurrency transaction processing revenue following
the acquisition of LibertyX in January 2022.

Digital banking revenue increased 2% and 6% for the three and six months ended
June 30, 2022respectively, compared to the prior year periods, due to an increase in software licensing and cloud services revenue.

Self-Service Banking revenue increased 5% and 1% for the three and six months
ended June 30, 2022, respectively, compared to the prior year periods. Foreign
currency fluctuations had an unfavorable impact of 4% and 3% on the three and
six month revenue comparisons, respectively. For the three months ended June 30,
2022, the increase in revenue is due to an increase in ATM hardware sales and an
increase in software and services revenues, including software licenses and
hardware and software maintenance. For the six months ended June 30, 2022, the
increase in revenue compared to prior year period is due to an increase in
software and services revenues, including software licenses, hardware
maintenance and professional services partially offset by a decline in ATM
hardware sales. The decline in ATM hardware sales was due in part to supply
chain challenges that resulted in temporary order fulfillment delays during the
first quarter of 2022. Software and services revenue as a percent of total
Self-Service Banking segment revenue was 67% in the second quarter of 2022 and
2021.

Retail revenue was flat for the three months ended June 30, 2022 compared to the
prior year period and increased 2% for the six months ended June 30, 2022
compared to the prior year period. Foreign currency fluctuations had an
unfavorable impact of 4% on the three and six month revenue comparisons,
respectively. Revenue results were primarily due to higher point-of-sale
hardware and point-of-sale solutions revenue partially offset by a decrease in
services revenue and self checkout hardware revenue.

Hospitality revenue increased 11% and 14% for the three and six months ended
June 30, 2022, respectively, compared to the prior year period, driven primarily
by an increase in point-of-sale hardware and point-of-sale solutions revenue, as
well as an increase in services and payments processing revenues.

For the operations grouped as Other, revenue decreased 21% and 16% for the three
and six months ended June 30, 2022, respectively, compared to the prior year
period, primarily due to a decrease in hardware maintenance revenue in the
telecommunications and technology business.

Segment Adjusted EBITDA

For the three and six months ended June 30, 2022 compared to the three and six months ended June 30, 2021

Payments & Network Adjusted EBITDA increased significantly for the three and six
months ended June 30, 2022 compared to the prior year period, primarily due to
additional payments processing revenue from the acquisition of Cardtronics,
which occurred in the second quarter of 2021. Payments & Network Adjusted EBITDA
for the three and six months ended June 30, 2022 has been negatively impacted by
higher interest rates, which increases the cost of our vault cash rental
obligations.

Digital Banking Adjusted EBITDA increased 2% and 3% for the three and six months
ended June 30, 2022, respectively, compared to the prior year period, driven by
an increase in recurring revenue.

Self-Service Banking Adjusted EBITDA increased 1% and declined 8% for the three
and six months ended June 30, 2022, respectively, compared to the prior year
period. The increase in Adjusted EBITDA for the three months ended June 30, 2022
compared to the prior year period was primarily due to favorable revenue mix on
increased software and services revenue, partially offset by supply chain
challenges and increased fuel costs which drove up component and other costs,
particularly in ATM hardware, hardware maintenance and transaction services. The
decline in Adjusted EBITDA for the six months ended June 30, 2022 compared to
the prior year period was primarily due to supply chain challenges and increased
fuel costs. These headwinds were partially offset by an increase in recurring
revenue.

Retail Adjusted EBITDA declined 14% and 22% for the three and six months ended
June 30, 2022, respectively, compared to the prior year period, primarily driven
by product cost and mix, increased labor costs, and other supply chain
challenges in the first half of 2022.
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Hospitality Adjusted EBITDA increased 18% and 16% for the three and six months
ended June 30, 2022, respectively, compared to the prior year period, primarily
driven by an increase in revenue driven by subscription and payments processing.
These improvements were partially offset by supply chain challenges and
increased fuel costs which drove up component and other costs, particularly in
transaction services and hardware in the first half of 2022.

Corporate and Other Adjusted EBITDA loss increased 10% and 25% for the three and
six months ended June 30, 2022, respectively, compared to the prior year period,
primarily due to infrastructure costs of the Cardtronics business that was
acquired on June 21, 2021.


Financial position, liquidity and capital resources

Cash provided by operating activities was $118 million in the six months ended
June 30, 2022 compared to cash provided by operating activities of $310 million
in the six months ended June 30, 2021. The decrease in cash provided by
operating activities in the six months ended June 30, 2022 was driven by lower
operating earnings as well as the unfavorable movement in net working capital
accounts, partially offset by cash received upon termination of interest rate
swap contracts in the first and second quarters of 2022.

NCR's management uses a non-GAAP measure called "free cash flow" to assess the
financial performance of the Company. We define free cash flow as net cash
provided by (used in) operating activities less capital expenditures for
property, plant and equipment, less additions to capitalized software,
plus/minus restricted cash settlement activity, plus acquisition-related items,
less the impact from the initial sale of trade accounts receivables under the
agreement entered into during the 3rd quarter of 2021, and plus pension
contributions and settlements. We believe free cash flow information is useful
for investors because it relates the operating cash flows from the Company's
continuing and discontinued operations to the capital that is spent to continue
and improve business operations. In particular, free cash flow indicates the
amount of cash available after capital expenditures for, among other things,
investments in the Company's existing businesses, strategic acquisitions,
repurchases of NCR stock and repayment of debt obligations. Free cash flow does
not represent the residual cash flow available for discretionary expenditures,
since there may be other non-discretionary expenditures that are not deducted
from the measure. Free cash flow does not have a uniform definition under GAAP,
and therefore NCR's definition may differ from other companies' definitions of
this measure. This non-GAAP measure should not be considered a substitute for,
or superior to, cash flows from operating activities under GAAP.

The table below reconciles net cash provided by operating activities to NCR’s non-GAAP measure of free cash flow for the six months ended June 30, 2022 :

                                                         Six months ended June 30
In millions                                                  2022           

2021

Net cash provided by operating activities                  118                    $ 310
Expenditures for property, plant and equipment             (32)             

(30)

Additions to capitalized software                         (142)             

(110)

Restricted cash settlement activity                         37                        1
Transaction costs                                            -                       55

Pension contributions                                        9                        9
Free cash flow (non-GAAP)                        $         (10)                   $ 235



Financing activities and certain other investing activities are not included in
our calculation of free cash flow. Other investing activities primarily include
business acquisitions, divestitures and investments. During the six months ended
June 30, 2022, the payments for business combinations totaled $1 million, net of
cash acquired, for the cash consideration paid related to the acquisition of
LibertyX completed in January of 2022 and the acquisition of Cardtronics in June
of 2021. The LibertyX acquisition was completed via issuance of NCR common stock
in exchange for the outstanding shares of LibertyX. During the six months ended
June 30, 2021, the payments for business combinations was $2,464 million, mainly
related to the acquisition of Cardtronics completed in the second quarter of
2021.

Our financing activities include borrowings and repayments of credit facilities.
During the six months ended June 30, 2021, in connection with the acquisition of
Cardtronics, we issued new senior unsecured notes for an aggregate principal
amount of $1.2 billion and amended and restated the Senior Secured Credit
Facility to add an incremental term loan for $1.505 billion, of which
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$200 million converted into the Revolving Credit Facility. Additionally, we paid
$32 million of deferred financing fees related to these transactions.

Financing activities during the six months ended June 30, 2022 also included
dividends paid on the Series A preferred stock of $8 million, proceeds from
employee stock plans of $14 million as well as tax withholding payments on
behalf of employees for stock based awards that vested of $36 million. Financing
activities during the six months ended June 30, 2021 included dividends paid on
the Series A preferred stock of $8 million, proceeds from stock employee plans
of $18 million, and tax withholding payments on behalf of employees for stock
based awards that vested of $25 million.

Long Term Borrowings The Senior Secured Credit Facility consists of term loan
facilities in an aggregate principal amount of $2.055 billion, of which
$1.94 billion was outstanding as of June 30, 2022. Additionally, the Senior
Secured Credit Facility provides for a five-year Revolving Credit Facility with
an aggregate principal amount of $1.3 billion, of which $420 million was
outstanding as of June 30, 2022. The Revolving Credit Facility also contains a
sub-facility to be used for letters of credit, and as of June 30, 2022, there
were $24 million letters of credit outstanding.

As of June 30, 2022, we had outstanding $1.2 billion in aggregate principal
balance of 5.125% senior unsecured notes due in 2029, $500 million in aggregate
principal balance of 5.750% senior unsecured notes due in 2027, $650 million
aggregate principal balance of 5.000% senior unsecured notes due in 2028, $500
million in aggregate principal balance of 6.125% senior unsecured notes due in
2029, and $450 million in aggregate principal balance of 5.250% senior unsecured
notes due in 2030.

See Note 5, “Debt Obligations”, of the Notes to the Summary Consolidated Financial Statements included in Section 1 of this report for further information on the Senior Secured Credit Facility.

Employee Benefit Plans In 2022, we expect to make contributions of $17 million
to our international pension plans, $80 million to our postemployment plan and
$1 million to our postretirement plan. For additional information, refer to Note
9, "Employee Benefit Plans" of the Notes to Condensed Consolidated Financial
Statements.

Series A Convertible Preferred Stock As of June 30, 2022, the redemption value
of the Series A Preferred Stock was approximately $276 million. Holders of
Series A Convertible Preferred Stock are entitled to a cumulative dividend at
the rate of 5.5% per annum, payable quarterly in arrears. Beginning in the first
quarter of 2020, dividends are payable in cash or in-kind at the option of the
Company. During the six months ended June 30, 2022 and 2021, the Company paid
cash dividends of $8 million, respectively.

The Series A Convertible Preferred Stock is convertible at the option of the
holders at any time into shares of common stock at a conversion price of $30.00
per share, or a conversion rate of 33.333 shares of common stock per share of
Series A Convertible Preferred Stock. As of June 30, 2022 and December 31, 2021,
the maximum number of common shares that could be required to be issued upon
conversion of the outstanding shares of the Series A Convertible Preferred Stock
was 9.2 million shares.

Cash and Cash Equivalents Held by Foreign Subsidiaries Cash and cash equivalents
held by the Company's foreign subsidiaries at June 30, 2022 and December 31,
2021 were $318 million and $412 million, respectively. Under current tax laws
and regulations, if cash and cash equivalents and short-term investments held
outside the U.S. are distributed to the U.S. in the form of dividends or
otherwise, we may be subject to additional U.S. income taxes and foreign
withholding taxes, which could be significant.

Summary As of June 30, 2022, our cash and cash equivalents totaled $398 million
and our total debt was $5.66 billion, excluding deferred fees. As of June 30,
2022, our borrowing capacity under the Revolving Credit Facility was
approximately $856 million. Our ability to generate positive cash flows from
operations is dependent on general economic conditions, the competitive
environment in our industry, and is subject to the business and other risk
factors described in Item 1A of Part I of the Company's 2021 Annual Report on
Form 10-K and Item 1A of Part II of this Quarterly Report on Form 10-Q (as
applicable). If we are unable to generate sufficient cash flows from operations,
or otherwise comply with the terms of our credit facilities, we may be required
to seek additional financing alternatives.

We believe that we have sufficient liquidity based on our current cash position,
cash flows from operations and existing financing to meet our expected pension,
postemployment, and postretirement plan contributions, remediation payments
related to environmental matters, debt servicing obligations, payments related
to transformation initiatives, and in the long-term (i.e., beyond June 30, 2023)
to meet our material cash requirements.

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Significant cash requirements related to contractual and other obligations

There have been no material changes in our contractual and other business obligations as described in our Form 10-K for the year ended December 31, 2021.

Significant Accounting Policies and Estimates

Critical accounting policies are those that are most important to the portrayal
of our financial position and results of operations. These policies require
highly subjective or complex judgments, often employing the use of estimates
about the effect of matters that are inherently uncertain. Our most critical
accounting estimates pertain to revenue recognition, inventory valuation,
goodwill and intangible assets, pension, postretirement and postemployment
benefits, environmental and legal contingencies, and income taxes, which are
described in Item 7. of our 2021 Form 10-K.

New accounting statements

See the discussion in note 1, “Basis of presentation and summary of significant accounting policies” of the notes to the condensed consolidated financial statements for new accounting pronouncements.

Forward-looking statements

This quarterly report on Form 10-Q contains "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as amended and Section
21E of the Securities Exchange Act of 1934, as amended, pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995 (the
"Act"). Forward-looking statements use words such as "expect," "anticipate,"
"outlook," "intend," "plan," "confident," "believe," "will," "should," "would,"
"potential," "positioning," "proposed," "objective," "could," "may," and words
of similar meaning, as well as other words or expressions referencing future
events, conditions or circumstances. We intend these forward-looking statements
to be covered by the safe harbor provisions for forward-looking statements
contained in the Act. Statements that describe or relate to NCR's plans, goals,
intentions, strategies, or financial outlook, and statements that do not relate
to historical or current fact, are examples of forward-looking statements.
Forward-looking statements are based on our current beliefs, expectations and
assumptions, which may not prove to be accurate, and involve a number of known
and unknown risks and uncertainties, many of which are out of NCR's control.
Forward-looking statements are not guarantees of future performance, and there
are a number of important factors that could cause actual outcomes and results
to differ materially from the results contemplated by such forward-looking
statements, including those factors relating to:
•Strategy and Technology: transforming our business model; development and
introduction of new solutions; competition in the technology industry;
integration of acquisitions and management of alliance activities; our
multinational operations; and our strategic review announced on February 8, 2022
•Business Operations: domestic and global economic and credit conditions; risks
and uncertainties from the payments-related business and industry; disruptions
in our data center hosting and public cloud facilities; retention and attraction
of key employees; defects, errors, installation difficulties or development
delays; failure of third-party suppliers; the impact of the coronavirus
(COVID-19) pandemic and geopolitical and macroeconomic challenges; environmental
exposures from historical and ongoing manufacturing activities; and climate
change
•Data Privacy & Security: impact of data protection, cybersecurity and data
privacy including any related issues
•Finance and Accounting: our level of indebtedness; the terms governing our
indebtedness; incurrence of additional debt or similar liabilities or
obligations; access or renewal of financing sources; our cash flow sufficiency
to service our indebtedness; interest rate risks; the terms governing our trade
receivables facility; the impact of certain changes in control relating to
acceleration of our indebtedness, our obligations under other financing
arrangements, or required repurchase of our senior unsecured notes; and any
lowering or withdrawal of the ratings assigned to our debt securities by rating
agencies; our pension liabilities; and write down of the value of certain
significant assets
•Law and Compliance: protection of our intellectual property; changes to our tax
rates and additional income tax liabilities; uncertainties regarding
regulations, lawsuits and other related matters; and changes to cryptocurrency
regulations
•Governance: impact of the terms of our Series A Convertible Preferred ("Series
A") Stock relating to voting power, share dilution and market price of our
common stock; rights, preferences and privileges of Series A stockholders
compared to the rights of our common stockholders; and actions or proposals from
stockholders that do not align with our business strategies or the interests of
our other stockholders

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Additional information concerning these and other factors can be found in the
Company's filings with the U.S. Securities and Exchange Commission, including
the Company's most recent annual report on Form 10-K, quarterly reports on Form
10-Q and current reports on Form 8-K. Any forward-looking statement speaks only
as of the date on which it is made. The Company does not undertake any
obligation to publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise, except as required
by law.

Information About NCR

NCR encourages investors to visit its web site (http://www.ncr.com), which is
updated regularly with financial and other important information about NCR. The
contents of the Company's web site are not incorporated into this quarterly
report or the Company's other filings with the U.S. Securities and Exchange
Commission.
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