8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): August 2, 2022

Diebold Nixdorf, Incorporated

(Exact name of registrantas specified in its charter)

Ohio	1-4879	34-0183970
(State or other jurisdiction	(Commission	(I.R.S. Employer
of incorporation)	File Number)	Identification No.)

50 Executive Parkway, P.O. Box 2520 Hudson, Ohio	44236
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (330) 490-4000

Not Applicable

Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common shares, $1.25 par value per share	DBD	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    ☐

Item 2.02    Results of Operations and Financial Condition

On August 2, 2022, Diebold Nixdorf, Incorporated (the “Company”) issued a news release announcing its results for the second quarter of 2022 (the “News Release”). The News Release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The Company also issued a shareholder letter (the “Letter”) which includes financial results. The Company intends to post a copy of the Letter to the investor relations page of its corporate website. A copy of the Letter is furnished as Exhibit 99.2 to this current report.

The information in this Item 2.02 shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section and shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.

Item 9.01    Financial Statements and Exhibits

  (d)    Exhibits.

Exhibit Number	Description
99.1	News release of Diebold Nixdorf, Incorporated dated August 2, 2022
99.2	Shareholder Letter of Diebold Nixdorf, Incorporated dated August 2, 2022
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		Diebold Nixdorf, Incorporated
Date:   August 2, 2022	By:	/s/ Jeffrey Rutherford
		Name:	Jeffrey Rutherford
		Title:	Executive Vice President and Chief Financial
			Officer
			(Principal Financial Officer)

EX-99.1

Exhibit 99.1

	press release
Media contact:	Investor contact:
Mike Jacobsen, APR	Christine Marchuska, CAIA
+1 330 490 4498	+1 607 206 9212
michael.jacobsen@dieboldnixdorf.com	christine.marchuska@dieboldnixdorf.com

FOR IMMEDIATE RELEASE:

August 02, 2022

Diebold Nixdorf Reports 2022 Second Quarter Financial Results

Please visit http://www.dieboldnixdorf.com/earnings for a comprehensive shareholder letter and additional content

HUDSON, Ohio - Diebold Nixdorf (NYSE:DBD) today reported its second quarter 2022 financial results.

Key Highlights

• Robust order entry activity, ending the second quarter with a record $1.4 billion in backlog

• Reported revenue of $852 million, up 3% sequentially, reflecting sustained customer demand for the company’s products and services

• Reaffirm Adjusted EBITDA guidance of $320 million to $350 million

• New operating model well underway, with ~$120 million of annualized costs either removed or in a transition period, equating to roughly $12 million of non-GAAP savings in Q2 and representing approximately 80% of the company’s previously disclosed $150 million+ cost savings plan

Octavio Marquez, Diebold Nixdorf president and chief executive officer, said: “During my first full quarter as CEO, we delivered on our prior commitments with sequential quarter-over-quarter improvement on a number of key measures. Over the past several weeks, our company has worked quickly to take important steps to become more agile and better equipped to face challenges in a difficult macroeconomic environment. We recently implemented a new and simplified operating model that will help us improve our financial performance, elevate customer service and put us on a path toward a stronger future. We have confidence our new operating model will ultimately drive us forward and help our efforts to focus on what matters most – serving customers and creating value for shareholders.

“While we strive to improve what we do and how we do it as a company, we are still working against the expected challenges we faced during the past few quarters. We also expect foreign currency exchange (FX) will be an additional, significant headwind in the second half of the year given our scale in Europe. However, we are continuing to respond to these challenges swiftly and deploying mitigation tactics wherever possible. I am pleased with the early progress we are making with simplifying and streamlining our business, executing on our cost savings plan, and moving forward with our refinancing efforts all while continuing to navigate the uncertain macroeconomic environment.”

Business Highlights

• Banking

^°  DN Series^™ ATMs are now live in over 90 countries with over 570 certifications; shift away from legacy devices continues, with DN Series cash recyclers comprising 82% of new banking orders in North America

^°  Secured an ~$8 million deal with one of the largest banks in Egypt including expansion of their fleet to ~50% DN Series ATMs including cash recyclers, a software win for our Vynamic suite and a six-year maintenance contract

^°  Won a ~$6 million Managed Services deal for a large bank in India, a new contract including ATM monitoring, event management, help desk, cash forecasting, site maintenance and more

^°  Awarded a ~$5 million contract with a major U.S.-based financial institution operating in ~30 states to refresh their existing fleet of ATMs with DN Series – displacing a competitor

• Retail

^°  Self-checkout (SCO) products continue to drive our Retail business, with these solutions growing faster than the market, specifically in Europe

^°  Secured a ~$20 million win with a U.K.-based conglomerate that encompasses both high-end retail stores and grocery for SCO replacements as well as a five-year contract for services, including maintenance

^°  Continue to make progress with our SCO solutions in the U.S. as we won an ~$5 million contract for a U.S.-based chain of specialty discount stores for these products and are accelerating deployments with large European grocers across the U.S.

^°  Continued progress in leveraging services business in the EV space — extending our pilot with Chargepoint to additional regions; went live with Alfen adding eight additional countries; and added countries and retail projects with Compleo

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Jeff Rutherford, Diebold Nixdorf executive vice president and chief financial officer, said: “We remain encouraged by order entry activity, a forward-looking indicator of demand, and are confident in our operating model as we continue to implement cost savings and additional operational rigor to accelerate the pace of backlog conversion to revenue and free cash flow. As a result, we are reiterating our adjusted EBITDA guidance range and our free cash flow outlook. Free cash flow is directly correlated with our expected adjusted EBITDA guidance as well as working capital normalization. Note our free cash flow guidance includes cash restructuring charges. To reflect ongoing challenges in the macroeconomic environment, we are adjusting our full-year revenue outlook. The company currently expects total revenue of $3.55 billion to $3.75 billion, with a majority of the adjustment attributable to unfavorable FX impacts. Adjusted EBITDA and free cash flow guidance considers that savings from our restructuring plan and other cost management measures will offset our adjusted revenue guidance. On a constant currency basis adjusting for divestitures, we expect full-year revenue to be flat on a year-over-year basis.”

Full-year 2022 Outlook

	Previous Outlook	Revised Outlook
Total Revenue	$3.7B - $3.9B	$3.55B - $3.75B
Adjusted EBITDA (Non-GAAP measure)1	$320M - $350M	$320M - $350M
Free cash flow (Non-GAAP measure)2	Break even	Break even
Return on Invested Capital (Non-GAAP measure)1,3	~13%	~13%

Segment Reporting Structure

In the second quarter of 2022, the company reorganized its reportable segments due to the simplification of its organizational structure. The new reportable segments are Global Banking and Global Retail, which aligns with how the company makes key operating decisions, allocate resources and assess performance going forward. The new Banking segment’s sales and cost of sales are the summation of the historical Americas Banking and Eurasia Banking segments. The segment change has no impact on Retail’s sales or cost of sales. Certain corporate costs and Non-GAAP adjustments are not assigned to our reportable segments, as these charges are managed separately from the segment information the company uses to make operating decisions and assess performance.

Also in connection with the operating structure simplification, the company will no longer be separately reporting software sales and software cost of sales in its earnings materials. Rather, and consistent with its historical reporting on Form 10-Q and Form 10-K, the company will report product and service sales and cost of sales. Software licenses are included in product, while software maintenance and support and professional services are reported within service.

Prior-periods have been recast to conform to the new reporting structure. Reconciliations between the new and historical format are included within the shareholder letter being furnished with this release and available on the Company’s website. These changes did not impact the consolidated financial statements.

^{1 -} With respect to the company’s adjusted EBITDA and Return on Invested Capital (ROIC) outlook for 2022, it is not providing a reconciliation to the most directly comparable GAAP financial measures because it is unable to predict with reasonable certainty those items that may affect such measures calculated and presented in accordance with GAAP without unreasonable effort. These measures primarily exclude future restructuring actions and net non-routine items. These reconciling items are uncertain, depend on various factors and could significantly impact, either individually or in the aggregate, operating profit and net income calculated and presented in accordance with GAAP. Please see “Non-GAAP Financial Measures and Other Information” for additional information regarding our use of Non-GAAP financial measures.

² - Free cash flow is a Non-GAAP financial measure defined as net cash provided by operating activities from continuing operations less capital expenditures, less cash used for capitalized software development, and excluding the impact of changes in cash of assets held for sale and the use of cash for M&A and the legal settlement for impaired cloud implementation costs, and excluding the use of cash for the settlement of foreign exchange derivative instruments. With respect to the company’s Non-GAAP free cash flow outlook for 2022, it is not providing a reconciliation to the most directly comparable GAAP financial measure because it is unable to predict with reasonable certainty those items that may affect such measure calculated and presented in accordance with GAAP without unreasonable effort. This measure primarily excludes the future impact of changes in cash of assets held for sale, cash used for M&A activities and the settlement of foreign exchange derivative instruments. These reconciling items are uncertain, depend on various factors and could significantly impact, either individually or in the aggregate, net cash provided (used) by operating activities calculated and presented in accordance with GAAP. Please see “Non-GAAP Financial Measures and Other Information” for additional information regarding our use of Non-GAAP financial measures.

³ - ROIC is defined as tax-effected adjusted operating profit (NOPAT), utilizing an estimated 30% effective tax rate, divided by average invested capital for the period.

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Overview Presentation and Conference Call

More information on Diebold Nixdorf’s quarterly earnings is available on its Investor Relations website. Octavio Marquez, president and chief executive officer, and Jeffrey Rutherford, executive vice president and chief financial officer, will discuss the company’s financial performance during a conference call today at 8:30 a.m. (ET). Both the presentation and access to the call / webcast are available at http://www.dieboldnixdorf.com/earnings. The replay of the webcast can be accessed on the website for up to three months after the call.

About Diebold Nixdorf

Diebold Nixdorf, Incorporated (NYSE: DBD) is a world leader in enabling connected commerce. We automate, digitize and transform the way people bank and shop. As a partner to the majority of the world’s top 100 financial institutions and top 25 global retailers, our integrated solutions connect digital and physical channels conveniently, securely and efficiently for millions of consumers each day. The company has a presence in more than 100 countries with approximately 22,000 employees worldwide. Visit www.DieboldNixdorf.com for more information.

Twitter: @DieboldNixdorf

LinkedIn: www.linkedin.com/company/diebold

Facebook: www.facebook.com/DieboldNixdorf

YouTube: www.youtube.com/dieboldnixdorf

Non-GAAP Financial Measures and Other Information

To supplement our condensed consolidated financial statements presented in accordance with GAAP, the company considers certain financial measures that are not prepared in accordance with GAAP, including Non-GAAP results, adjusted diluted earnings per share, free cash flow (use) and unlevered free cash flow (use), net debt, EBITDA, adjusted EBITDA and constant currency results. The company calculates constant currency by translating the prior year results at current year exchange rates. The company uses these Non-GAAP financial measures, in addition to GAAP financial measures, to evaluate our operating and financial performance and to compare such performance to that of prior periods and to the performance of our competitors. Also, the company uses these Non-GAAP financial measures in making operational and financial decisions and in establishing operational goals. The company also believes providing these Non-GAAP financial measures to investors, as a supplement to GAAP financial measures, helps investors evaluate our operating and financial performance and trends in our business, consistent with how management evaluates such performance and trends. The company also believes these Non-GAAP financial measures may be useful to investors in comparing its performance to the performance of other companies, although its Non-GAAP financial measures are specific to the company and the Non-GAAP financial measures of other companies may not be calculated in the same manner. We provide EBITDA and Adjusted EBITDA because we believe that investors and securities analysts will find EBITDA and adjusted EBITDA to be useful measures for evaluating our operating performance and comparing our operating performance with that of similar companies that have different capital structures and for evaluating our ability to meet our future debt service, capital expenditure and working capital requirements. We are also providing EBITDA and adjusted EBITDA in light of our credit agreement and the secured and unsecured senior notes. We consider free cash flow (use) to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that, after the purchase of property and equipment and capitalized software development, changes in cash of assets held for sale and the use of cash for M&A and the legal settlement for impaired cloud implementation costs, and excluding the use/proceeds of cash for the settlement of foreign exchange derivative instruments, can be used for debt servicing, strategic opportunities, including investing in the business, making strategic acquisitions, strengthening the balance sheet and paying dividends. Unlevered free cash flow (use) provides incremental visibility into the company’s liquidity by excluding cash used for interest payments from free cash flow (use). For more information, please refer to the section, “Notes for Non-GAAP Measures.”

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Forward-Looking Statements

This press release contains statements that are not historical information and are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding the potential impact of the ongoing coronavirus (COVID-19) pandemic, anticipated revenue, future liquidity and financial position.

Statements can generally be identified as forward-looking because they include words such as “believes,” “anticipates,” “expects,” “could,” “should” or words of similar meaning. Statements that describe the company’s future plans, objectives or goals are also forward-looking statements. Forward-looking statements are subject to assumptions, risks and uncertainties that may cause actual results to differ materially from those contemplated by such forward-looking statements. The factors that may affect the company’s results include, among others:

• the overall impact of global supply chain complexities on the company and its business, including delays in sourcing key components as well as longer transport times, especially for container ships and U.S. trucking, given the company’s reliance on suppliers, subcontractors and availability of raw materials and other components;

• the ultimate impact of the ongoing COVID-19 pandemic, and other public health emergencies, including further adverse effects to the company’s supply chain, maintenance of increased order backlog, and the effects of any COVID-19 related cancellations;

• the company’s ability to successfully meet its cost-reduction goals and to continue to achieve benefits from its cost-reduction initiatives and other strategic initiatives, such as the current cost savings plan;

• the success of the company’s new products, including its DN Series line and EASY family of retail checkout solutions;

• the impact of a cybersecurity breach or operational failure on the company’s business;

• the company’s ability to generate sufficient cash to service its debt or to comply with the covenants contained in the agreements governing its debt and to successfully refinance its debt;

• the company’s ability to attract, retain and motivate key employees;

• changes in the company’s intention to further repatriate cash and cash equivalents and short-term investments residing in international tax jurisdictions, which could negatively impact foreign and domestic taxes;

• the company’s success in divesting, reorganizing or exiting non-core and/or non-accretive businesses and its ability to successfully manage acquisitions, divestitures, and alliances;

• the ultimate outcome of the appraisal proceedings initiated in connection with the implementation of the Domination and Profit Loss Transfer Agreement with the former Diebold Nixdorf AG (which was dismissed in the Company’s favor at the lower court level in May 2022) and the merger/squeeze-out;

• the impact of market and economic conditions, including the proliferation of cash and any deterioration or disruption in the financial and service markets, including the bankruptcies, restructurings or consolidations of financial institutions, which could reduce the company’s customer base and/or adversely affect its customers’ ability to make capital expenditures, as well as adversely impact the availability and cost of credit; competitive pressures, including pricing pressures and technological developments;

• changes in political, economic or other factors such as currency exchange rates, inflation rates (including the impact of possible currency devaluations in countries experiencing high inflation rates), recessionary or expansive trends, hostilities or conflicts (including the conflict between Russia and Ukraine), disruption in energy supply, taxes and regulations and laws affecting the worldwide business in each of the company’s operations;

• the company’s ability to maintain effective internal controls;

• unanticipated litigation, claims or assessments, as well as the outcome/impact of any current/pending litigation, claims or assessments;

• the effect of changes in law and regulations or the manner of enforcement in the U.S. and internationally and the company’s ability to comply with government regulations; and

• other factors included in the company’s filings with the SEC, including its Annual Report on Form 10-K for the year ended December 31, 2021 and in other documents the company files with the SEC.

You should consider these factors carefully in evaluating forward-looking statements and are cautioned not to place undue reliance on such statements. The company assumes no obligation to update any forward-looking statements, which speak only to the date of this document.

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Summary Financial Results

	Three months ended
	June 30, 2022								June 30, 2021								% Change
($ in millions, except per share data)	GAAP				Non-GAAP4				GAAP				Non-GAAP4				GAAP			Non-GAAP
Total net sales		$	851.7			$	846.0			$	943.5			$	943.5			(9.7	)		(10.3	)
Gross profit		$	160.8			$	209.9			$	251.9			$	261.8			(36.2	)		(19.8	)
Operating profit (loss)		$	(91.5	)		$	52.3			$	12.9			$	63.1			N/M			(17.1	)
Operating margin			(10.7	)%			6.2	%			1.4	%			6.7	%		(1,210	) bps		(50	) bps
Net income (loss)		$	(199.1	)		$	31.6			$	(30.3	)		$	8.0			N/M			N/M
Diluted earnings/(loss) per share5		$	(2.52	)		$	0.38			$	(0.39	)		$	0.10			N/M			N/M
Adjusted EBITDA						$	70.9							$	86.3						(17.8	)

• Total net sales decreased 9.7%, or 91.8 million YoY, primarily due to the foreign currency translation impact of the declining value or the Euro in comparison to the U.S. dollar and longer lead times resulting from global supply chain and logistics issues.

• Non-GAAP operating profit declined 17.1% to $52.3 million and Non-GAAP operating margin decreased 50 bps to 6.2% due primarily to revenue delays and net inflationary costs.

	Q2 2022		Q2 2021		YTD     6/30/2022		YTD     6/30/2021		TTM   6/30/2022
Net cash (used) provided by operating activities (GAAP measure)	$	(80.4)	$	(78.5)	$	(306.6)	$	(143.7)	$	(39.6)
Excluding the impact of changes in cash of assets held for sale and the use of cash for M&A activities		—		8.2		3.4		7.6		16.8
Excluding the use of cash for the settlement of foreign exchange derivative instruments		0.7		0.1		0.7		4.5		0.7
Excluding the use of cash for the legal settlement related to the impaired cloud-based ERP implementation fees		5.0		—		5.0		—		5.0
Capital expenditures		(4.1)		(3.7)		(8.1)		(6.2)		(18.8)
Capitalized software development		(9.8)		(5.3)		(17.4)		(11.2)		(37.3)
Free cash flow (use) (Non-GAAP measure)	$	(88.6)	$	(79.2)	$	(323.0)	$	(149.0)	$	(73.2)
Add back: cash interest	$	27.9	$	27.0	$	86.5	$	87.0	$	174.6
Unlevered free cash flow (use) (Non-GAAP measure)	$	(60.7)	$	(52.2)	$	(236.5)	$	(62.0)	$	101.4

• Free cash use of $88.6 million in the quarter was unfavorable by $9.4 million versus the prior year quarter reflecting reduced profitability and cash used for inventory purchases, partially offset by strict payables management.

⁴ - See note 1 below for GAAP to Non-GAAP adjustments to net sales, gross profit and operating expenses, which include selling and administrative expense, research, development and engineering expense and impairment of assets; note 2 for adjusted EBITDA; and note 3 for adjusted net income/loss and adjusted EPS.

⁵ - Represents Diluted earnings/(loss) per share attributable to Diebold Nixdorf, Incorporated.

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Financial Results of Operations and Segments

GAAP Revenue Summary by Reportable Segment & Business Line - Unaudited

Three months ended June 30, 2022 compared to three months ended June 30, 2021

	Three months ended              June 30
($ in millions)	2022		2021		% Change		% Change in CC6
Banking
Services	$	389.3	$	424.0		(8.2)%		(4.5)%
Products		200.9		214.5		(6.3)%		(0.4)%
Total Banking Revenue	$	590.2	$	638.5		(7.6)%		(3.1)%
Retail
Services	$	136.1	$	162.7		(16.3)%		(7.2)%
Products		125.4		142.3		(11.9)%		(3.5)%
Total Retail Revenue	$	261.5	$	305.0		(14.3)%		(5.5)%
Total by Business Line
Services	$	525.4	$	586.7		(10.4)%		(5.2)%
Products		326.3		356.8		(8.5)%		(1.6)%
Total Revenue	$	851.7	$	943.5		(9.7)%		(3.9)%
Six months ended June 30, 2022 compared to six months ended June 30, 2021
		Six months ended
	June 30
($ in millions)		2022		2021		% Change		% Change in CC6
Banking
Services	$	772.9	$	841.2		(8.1)%		(5.2)%
Products		380.0		436.8		(13.0)%		(8.7)%
Total Banking Revenue	$	1,152.9	$	1,278.0		(9.8)%		(6.3)%
Retail
Services	$	278.7	$	319.1		(12.7)%		(5.2)%
Products		249.9		290.3		(13.9)%		(7.2)%
Total Retail Revenue	$	528.6	$	609.4		(13.3)%		(6.2)%
Total by Business Line
Services	$	1,051.6	$	1,160.3		(9.4)%		(5.2)%
Products		629.9		727.1		(13.4)%		(8.1)%
Total Revenue	$	1,681.5	$	1,887.4		(10.9)%		(6.3)%

⁶ - The company calculates constant currency by translating the prior-year period results at current year exchange rates.

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GAAP and Non-GAAP Profit/Loss Summary - Unaudited Three months ended June 30, 2022 compared to three months ended June 30, 2021
	Three months ended
	June 30, 2022						June 30, 2021						Change
($ in millions)	GAAP			Non-GAAP7			GAAP			Non-GAAP7			GAAP		Non-GAAP
Services	$	525.4		$	524.6		$	586.7		$	586.7		$	(61.3)	$	(62.1)
Products		326.3			321.4			356.8			356.8			(30.5)		(35.4)
Total net sales	$	851.7		$	846.0		$	943.5		$	943.5		$	(91.8)	$	(97.5)
Services	$	150.3		$	158.7		$	176.8		$	185.0		$	(26.5)	$	(26.3)
Products		10.5			51.2			75.1			76.8			(64.6)		(25.6)
Total gross profit	$	160.8		$	209.9		$	251.9		$	261.8		$	(91.1)	$	(51.9)
Services		28.6	%		30.3	%		30.1	%		31.5	%		(150) bps		(130) bps
Products		3.2	%		15.9	%		21.0	%		21.5	%		(1,780) bps		(560) bps
Total gross margin		18.9	%		24.8	%		26.7	%		27.7	%		(780) bps		(290) bps
Operating expenses	$	252.3		$	157.6		$	239.0		$	198.7		$	13.3	$	(41.1)
Operating profit (loss)	$	(91.5	)	$	52.3		$	12.9		$	63.1		$	(104.4)	$	(10.8)
Operating margin		(10.7	)%		6.2	%		1.4	%		6.7	%		(1,210) bps		(50) bps
Six months ended June 30, 2022 compared to six months ended June 30, 2021
	Six months ended
		June 30, 2022						June 30, 2021						Change
($ in millions)	GAAP			Non-GAAP7,8			GAAP			Non-GAAP7			GAAP		Non-GAAP
Services	$	1,051.6		$	1,048.1		$	1,160.3		$	1,160.3		$	(108.7)	$	(112.2)
Products		629.9			622.3			727.1			727.1			(97.2)		(104.8)
Total net sales	$	1,681.5		$	1,670.4		$	1,887.4		$	1,887.4		$	(205.9)	$	(217.0)
Services	$	302.3		$	312.1		$	360.8		$	368.6		$	(58.5)	$	(56.5)
Products		43.8			83.8			164.3			166.6			(120.5)		(82.8)
Total gross profit	$	346.1		$	395.9		$	525.1		$	535.2		$	(179.0)	$	(139.3)
Services		28.7	%		29.8	%		31.1	%		31.8	%		(230) bps		(200) bps
Products		7.0	%		13.5	%		22.6	%		22.9	%		(1,560) bps		(940) bps
Total gross margin		20.6	%		23.7	%		27.8	%		28.4	%		(720) bps		(470) bps
Operating expenses	$	521.0		$	344.5		$	476.0		$	393.1		$	45.0	$	(48.6)
Operating profit (loss)	$	(174.9	)	$	51.4		$	49.1		$	142.1		$	(224.0)	$	(90.7)
Operating margin		(10.4	)%		3.1	%		2.6	%		7.5	%		(1,300) bps		(450) bps

⁷ - See note 1 below for GAAP to Non-GAAP adjustments to net sales, gross profit and operating expenses, which include selling and administrative expense, research, development and engineering expense and impairment of assets.

⁸ - Excludes the results of the non-core European retail business that is held for sale, which represents a change to the previously published first quarter information. Refer to note 1 below for further information.

7 of 15

Profit/Loss Summary by Segment - Unaudited⁹

Three months ended June 30, 2022 compared to three months ended June 30, 2021

	Three months ended
	June 30, 2022						June 30, 2021						Change
		Banking			Retail			Banking			Retail			Banking		Retail
($ in millions)
Services	$	389.3		$	135.3		$	424.0		$	162.7		$	(34.7)	$	(27.4)
Products		200.9			120.5			214.5			142.3			(13.6)		(21.8)
Total net sales	$	590.2		$	255.8		$	638.5		$	305.0		$	(48.3)	$	(49.2)
Services	$	117.7		$	41.0		$	135.9		$	49.1		$	(18.2)	$	(8.1)
Products		29.8			21.4			48.4			28.4			(18.6)		(7.0)
Total gross profit	$	147.5		$	62.4		$	184.3		$	77.5		$	(36.8)	$	(15.1)
Services		30.2	%		30.3	%		32.1	%		30.2	%		(180) bps		10  bps
Products		14.8	%		17.8	%		22.6	%		20.0	%		(770) bps		(220) bps
Total gross margin		25.0	%		24.4	%		28.9	%		25.4	%		(390) bps		(100) bps
Operating expenses10	$	67.0		$	27.8		$	82.5		$	38.4		$	(15.5)	$	(10.6)
Operating profit	$	80.5		$	34.6		$	101.8		$	39.1		$	(21.3)	$	(4.5)
Operating margin		13.6	%		13.5	%		15.9	%		12.8	%		(230) bps		70  bps
Six months ended June 30, 2022 compared to six months ended June 30, 2021
		Six months ended
	June 30, 2022						June 30, 2021						Change
		Banking			Retail			Banking			Retail			Banking		Retail
($ in millions)
Services	$	772.9		$	275.2		$	841.2		$	319.1		$	(68.3)	$	(43.9)
Products		380.0			242.3			436.8			290.3			(56.8)		(48.0)
Total net sales	$	1,152.9		$	517.5		$	1,278.0		$	609.4		$	(125.1)	$	(91.9)
Services	$	230.2		$	81.9		$	268.8		$	99.8		$	(38.6)	$	(17.9)
Products		43.1			40.7			107.8			58.8			(64.7)		(18.1)
Total gross profit	$	273.3		$	122.6		$	376.6		$	158.6		$	(103.3)	$	(36.0)
Services		29.8	%		29.8	%		32.0	%		31.3	%		(220) bps		(150) bps
Products		11.3	%		16.8	%		24.7	%		20.3	%		(1,330) bps		(350) bps
Total gross margin		23.7	%		23.7	%		29.5	%		26.0	%		(580) bps		(230) bps
Operating expenses10	$	147.1		$	63.8		$	165.8		$	77.3		$	(18.7)	$	(13.5)
Operating profit	$	126.2		$	58.8		$	210.8		$	81.3		$	(84.6)	$	(22.5)
Operating margin		10.9	%		11.4	%		16.5	%		13.3	%		(550) bps		(200) bps

⁹ - There is no difference between GAAP and Non-GAAP segment results; as the GAAP to Non-GAAP adjustments shown in Note 1 below are not assigned to the segment, as these adjustments relate to items that are considered non-routine in nature and thus do not impact the way in which the business is managed or performance is assessed.

¹⁰ - Operating expenses include shared corporate charges of $62.8 and $77.8 in the three months ended June 30, 2022 and 2021 and $133.6 and $150.0 in the six months ended June 30, 2022 and 2022 which are not reflected in the segment operating results, as these expenses are managed separately and not included in the segment results used to manage the business and assess performance. The unassigned corporate charges consist primarily of finance, IT, HR and legal expenditures.

8 of 15

DIEBOLD NIXDORF, INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED

(IN MILLIONS, EXCEPT EARNINGS PER SHARE)

	Q2 2022			Q2 2021			YTD 6/30/2022			YTD 6/30/2021
Net sales
Services	$	525.4		$	586.7		$	1,051.6		$	1,160.3
Products		326.3			356.8			629.9			727.1
Total		851.7			943.5			1,681.5			1,887.4
Cost of sales
Services		375.1			409.9			749.3			799.5
Products		315.8			281.7			586.1			562.8
Total		690.9			691.6			1,335.4			1,362.3
Gross profit		160.8			251.9			346.1			525.1
Gross margin		18.9	%		26.7	%		20.6	%		27.8	%
Operating expenses
Selling and administrative expense		213.8			204.8			394.8			408.2
Research, development and engineering expense		33.1			35.6			65.4			69.7
(Gain) loss on sale of assets, net		—			(1.4	)		0.2			(1.9	)
Impairment of assets		5.4			—			60.6			—
Total		252.3			239.0			521.0			476.0
Percent of net sales		29.6	%		25.3	%		31.0	%		25.2	%
Operating profit (loss)		(91.5	)		12.9			(174.9	)		49.1
Operating margin		(10.7	)%		1.4	%		(10.4	)%		2.6	%
Other income (expense)
Interest income		1.0			2.3			2.3			4.0
Interest expense		(49.6	)		(49.7	)		(97.7	)		(98.4	)
Foreign exchange gain (loss), net		2.3			(9.2	)		(2.4	)		(3.5	)
Miscellaneous, net		4.6			2.7			7.2			2.0
Total other (expense)		(41.7	)		(53.9	)		(90.6	)		(95.9	)
Loss before taxes		(133.2	)		(41.0	)		(265.5	)		(46.8	)
Income tax expense (benefit)		64.2			(11.2	)		115.1			(10.0	)
Equity in loss of unconsolidated subsidiaries		(1.7	)		(0.5	)		(2.4	)		(1.6	)
Net loss		(199.1	)		(30.3	)		(383.0	)		(38.4	)
Net income (loss) attributable to noncontrolling interests		0.1			—			(0.7	)		—
Net loss attributable to Diebold Nixdorf, Incorporated	$	(199.2	)	$	(30.3	)	$	(382.3	)	$	(38.4	)
Basic and diluted weighted-average shares outstanding		79.0			78.3			78.9			78.2
Net loss attributable to Diebold Nixdorf, Incorporated
Basic and diluted loss per share	$	(2.52	)	$	(0.39	)	$	(4.85	)	$	(0.49	)

9 of 15

DIEBOLD NIXDORF, INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS - UNAUDITED

(IN MILLIONS)

	6/30/2022			12/31/2021
ASSETS
Current assets
Cash, cash equivalents, and restricted cash	$	249.9		$	388.9
Short-term investments		31.4			34.3
Trade receivables, less allowances for doubtful accounts		563.1			595.2
Inventories		642.2			544.2
Other current assets		362.0			324.7
Total current assets		1,848.6			1,887.3
Securities and other investments		8.2			11.0
Property, plant and equipment, net		117.2			138.1
Goodwill		688.9			743.6
Customer relationships, net		242.3			301.7
Other assets		276.9			425.5
Total assets	$	3,182.1		$	3,507.2
LIABILITIES AND EQUITY
Current liabilities
Notes payable	$	10.8		$	47.1
Accounts payable		718.1			706.3
Deferred revenue		335.0			322.4
Other current liabilities		592.4			673.6
Total current liabilities		1,656.3			1,749.4
Long-term debt		2,411.7			2,245.6
Long-term liabilities		361.3			349.2
Total Diebold Nixdorf, Incorporated shareholders’ equity		(1,257.7	)		(845.1	)
Noncontrolling interests		10.5			8.1
Total equity		(1,247.2	)		(837.0	)
Total liabilities and equity	$	3,182.1		$	3,507.2

10 of 15

DIEBOLD NIXDORF, INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED

(IN MILLIONS)

	YTD 6/30/2022			YTD 6/30/2021
Cash flow from operating activities
Net loss	$	(383.0	)	$	(38.4	)
Adjustments to reconcile net loss to cash flow used by operating activities:
Depreciation and amortization		29.1			38.5
Amortization of Wincor Nixdorf purchase accounting intangible assets		36.1			39.8
Amortization of deferred financing costs into interest expense		8.3			8.7
Deferred income taxes		130.4			(3.9	)
Impairment of assets		60.6			—
Other		8.7			6.1
Changes in certain assets and liabilities
Trade receivables		(4.3	)		(2.3	)
Inventories		(136.0	)		(96.0	)
Accounts payable		46.0			70.4
Income taxes		(36.1	)		(34.2	)
Deferred revenue		24.0			(40.6	)
Warranty liability		(2.8	)		(0.2	)
Certain other assets and liabilities		(87.6	)		(91.6	)
Net cash provided (used) by operating activities		(306.6	)		(143.7	)
Cash flow from investing activities
Capital expenditures		(8.1	)		(6.2	)
Capitalized software development		(17.4	)		(11.2	)
Proceeds from divestitures, net of cash divested		10.5			5.8
Net short-term investment activity		8.1			27.0
Change in certain other assets		—			1.7
Net cash provided (used) by investing activities		(6.9	)		17.1
Cash flow from financing activities
Net debt borrowings (repayments)		186.0			23.1
Contributions from noncontrolling interest holders		—			12.7
Other		(5.7	)		(6.3	)
Net cash provided by financing activities		180.3			29.5
Effect of exchange rate changes on cash, cash equivalents and restricted cash		(5.5	)		(0.6	)
Change in cash, cash equivalents and restricted cash		(138.7	)		(97.7	)
Add: Cash included in assets held for sale at beginning of period		3.1			2.7
Less: Cash included in assets held for sale at end of period		3.4			5.2
Cash, cash equivalents and restricted cash at the beginning of the period		388.9			324.5
Cash, cash equivalents and restricted cash at the end of the period	$	249.9		$	224.3

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Notes for Non-GAAP Measures

To supplement our condensed consolidated financial statements presented in accordance with GAAP, the company utilizes certain financial measures that are not prepared in accordance with GAAP, including Non-GAAP results, EBITDA and Adjusted EBITDA, adjusted earnings per share, free cash flow (use) and net debt.

1. Profit/loss summary ($ in millions):

Three months ended June 30, 2022 compared to three months ended June 30, 2021

	Q2 2022															Q2 2021
		Net Sales			Gross Profit	% of Sales			OPEX			OP		% of Sales			Net Sales		Gross Profit		% of Sales			OPEX			OP		% of Sales
GAAP results	$	851.7		$	160.8	18.9	%	$	252.3		$	(91.5	)	(10.7	)%	$	943.5	$	251.9		26.7	%	$	239.0		$	12.9		1.4	%
Restructuring and transformation expenses		—			13.1				(65.2	)		78.3					—		11.2					(19.2	)		30.4
Amortization of Wincor Nixdorf purchase accounting intangible assets (non-cash)		—			—				(17.6	)		17.6					—		—					(19.9	)		19.9
Held for sale non-core European retail business		(5.7	)		0.5				(4.8	)		5.3					—		—					—			—
Non-routine income/expense:
Legal/deal expense		—			—				(0.8	)		0.8					—		—					(1.7	)		1.7
Crisis in Ukraine costs		—			—				(1.2	)		1.2					—		—					—			—
Divestitures and fixed asset sales		—			—				—			—					—		—					1.3			(1.3	)
Impairment from facility closure		—			—				(5.4	)		5.4					—		—					—			—
Inventory charge for legacy products		—			34.4				—			34.4					—		—					—			—
Other		—			1.1				0.3			0.8					—		(1.3	)				(0.8	)		(0.5	)
Non-routine expenses, net		—			35.5				(7.1	)		42.6					—		(1.3	)				(1.2	)		(0.1	)
Non-GAAP results	$	846.0		$	209.9	24.8	%	$	157.6		$	52.3		6.2	%	$	943.5	$	261.8		27.7	%	$	198.7		$	63.1		6.7	%

	Q2 2022							Q2 2021
	Services		Products			Total		Services			Products		Total
GAAP Gross Profit	$	150.3	$	10.5		$	160.8	$	176.8		$	75.1	$	251.9
Restructuring and transformation expenses		4.4		8.7			13.1		10.1			1.1		11.2
Held for sale non-core European retail business		2.9		(2.4	)		0.5		—			—		—
Non-routine income/expense:
Inventory charge for legacy products		—		34.4			34.4		—			—		—
Other		1.1		—			1.1		(1.9	)		0.6		(1.3	)
Non-routine expenses, net		1.1		34.4			35.5		(1.9	)		0.6		(1.3	)
Non-GAAP Gross Profit	$	158.7	$	51.2		$	209.9	$	185.0		$	76.8	$	261.8

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Six months ended June 30, 2022 compared to six months ended June 30, 2021

	YTD Q2 2022																	YTD Q2 2021
	Net Sales			Gross Profit		% of Sales			OPEX			OP			% of Sales			Net Sales		Gross Profit			% of Sales			OPEX			OP			% of Sales
GAAP results	$	1,681.5		$	346.1		20.6	%	$	521.0		$	(174.9	)		(10.4	)%	$	1,887.4	$	525.1			27.8	%	$	476.0		$	49.1			2.6	%
Restructuring and transformation expenses		—			13.1					(65.2	)		78.3						—		11.7						(41.9	)		53.6
Amortization of Wincor Nixdorf purchase accounting intangible assets (non-cash)		—								(36.1	)		36.1						—		—						(39.8	)		39.8
Held for sale non-core European retail business		(11.1	)		1.4					(10.3	)		11.7						—		—						—			—
Non-routine income/expense:
Legal/deal expense		—			—					(1.9	)		1.9						—		—						(2.3	)		2.3
North America ERP impairment		—			—					(38.4	)		38.4						—		—						—			—
Russia/Ukraine Impairment		—			—					(16.8	)		16.8						—		—						—			—
Crisis in Ukraine Costs		—			—					(2.5	)		2.5						—		—						—			—
Divestitures and fixed asset sales		—			—					—			—						—		—						1.9			(1.9	)
Impairment from facility closures		—			—					(5.4	)		5.4						—		—						—			—
Inventory charge for legacy products		—			34.4					—			34.4						—		—						—			—
Other		—			0.9					0.1			0.8						—		(1.6	)					(0.8	)		(0.8	)
Non-routine expenses, net		—			35.3					(64.9	)		100.2						—		(1.6	)					(1.2	)		(0.4	)
Non-GAAP results	$	1,670.4		$	395.9		23.7	%	$	344.5		$	51.4			3.1	%	$	1,887.4	$	535.2			28.4	%	$	393.1		$	142.1			7.5	%

	YTD Q2 2022							YTD Q2 2021
	Services		Products			Total		Services			Products		Total
GAAP Gross Profit	$	302.3	$	43.8		$	346.1	$	360.8		$	164.3	$	525.1
Restructuring and transformation expenses		4.4		8.7			13.1		10.1			1.6		11.7
Held for sale non-core European retail business		4.5		(3.1	)		1.4		—			—		—
Non-routine income/expense:
Inventory charge for legacy products		—		34.4			34.4		—			—		—
Other		0.9		—			0.9		(2.3	)		0.7		(1.6	)
Non-routine expenses, net		0.9		34.4			35.3		(2.3	)		0.7		(1.6	)
Non-GAAP Gross Profit	$	312.1	$	83.8		$	395.9	$	368.6		$	166.6	$	535.2

Restructuring and transformation expenses incurred in 2022 relate to the recently announced cost savings initiative focused on operational simplification and automation of processes, and the expenses incurred include severance charges, payroll expenses of employees transitioning out of the organization and costs of third-parties assisting with the execution of the program. Restructuring and transformation expenses incurred in 2021 are consistent in nature with 2022, but relate to the DN Now initiative focused on transitioning to a shared service model which culminated in the fourth quarter of 2021. The Wincor Nixdorf intangible asset amortization relates to the intangible assets established in purchase accounting as management believes that this is useful information to investors by highlighting the impact on the company’s operations. Held for sale non-core European retail business relates to the 2022 results of a majority-owned business that the company is committed to deconsolidate, that beginning in 2022 is excluded from the metrics used to evaluate the core business and assign resources, and which will be autonomous following completion of a data center project which commenced in 2022. Legal and deal expense primarily relates to third-party expenses and fees paid by the company for M&A activity. North America ERP impairment relates to the decision made by new leadership to indefinitely suspend the North America ERP implementation and strategically shift the digital transformation initiatives to the Company’s distribution subsidiaries which have a much greater opportunity for process standardization and related cost reductions. Russia/Ukraine impairment relates to the charges taken for trade receivables from customers in the region that are doubtful of being collected, inventory specifically for customers in the region and various other assets which are not recoverable. Crisis in Ukraine costs primarily relate to humanitarian efforts for our employees and their families, as well as expenses incurred in connection with the economic sanctions levied and steps taken to-date to liquidate our Russian distribution subsidiary. The divestitures and fixed asset sales relates primarily to the divestitures of non-core businesses in 2021. Impairment from facility closures is the write-down of right-of-use assets and related leasehold improvements for facilities identified for closure under the simplified operating model. The inventory charge for legacy products relates to excess and obsolete inventory as a result of a decision to streamline the company’s product portfolio.

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2. Reconciliation of GAAP net loss to EBITDA and Adjusted EBITDA (Non-GAAP measures) ($ in millions):

	Q2 2022			Q2 2021			YTD 6/30/2022			YTD 6/30/2021			TTM 6/30/2022
Net loss	$	(199.1	)	$	(30.3	)	$	(383.0	)	$	(38.4	)	$	(422.7	)
Income tax expense (benefit)		64.2			(11.2	)		115.1			(10.0	)		152.8
Interest income		(1.0	)		(2.3	)		(2.3	)		(4.0	)		(4.4	)
Interest expense		49.6			49.7			97.7			98.4			194.6
Depreciation and amortization		32.2			38.6			65.2			78.3			136.0
EBITDA		(54.1	)		44.5			(107.3	)		124.3			56.3
Share-based compensation		5.2			4.5			6.9			8.0			12.7
Amortization of cloud-based software implementation costs		0.5			—			1.0			—			1.0
Foreign exchange (gain) loss, net		(2.3	)		9.2			2.4			3.5			0.9
Miscellaneous, net		(4.6	)		(2.7	)		(7.2	)		(2.0	)		(8.6	)
Equity in loss of unconsolidated subsidiaries		1.7			0.5			2.4			1.6			0.5
Restructuring and transformation expenses		77.5			30.4			77.5			51.6			122.9
Non-routine (income)/expense, net		42.6			(0.1	)		100.2			(0.4	)		119.1
Held for sale non-core European retail business		4.4			—			9.9			—			9.9
Adjusted EBITDA	$	70.9		$	86.3		$	85.8		$	186.6		$	314.7
Adjusted EBITDA % revenue		8.3	%		9.1	%		5.1	%		9.9	%		8.5	%

The company defines EBITDA as net loss excluding income tax benefit/expense, net interest expense, and depreciation and amortization expense. Consistent with the company’s credit agreement, Adjusted EBITDA is EBITDA excluding the effects of the following items: share-based compensation, amortization of cloud-based software implementation costs, foreign exchange gain/loss net, miscellaneous net, equity in earnings of unconsolidated subsidiaries, restructuring and transformation expenses, non-routine expenses and the adjusted EBITDA loss of our held for sale non-core European retail business, as outlined in Note 1 of the Non-GAAP measures. To remain comparable to the U.S. GAAP depreciation and amortization measures, the company excluded the amortization of Wincor Nixdorf purchase accounting intangible assets from non-routine expenses, net in the Adjusted EBITDA reconciliation of $17.6 and $19.9 for the three months ended June 30, 2022 and 2021 and $36.1 and $39.8 for the six months ended June 30, 2022 and 2021. Additionally, $0.8 of restructuring-related share-based compensation activity was excluded from restructuring and transformation expenses for the three and six months ended June 30, 2022 and $2.0 of accelerated depreciation expense for the six months ended June 30, 2021 was excluded from restructuring and transformation expenses. Deferred financing fees amortization is included in interest expense; as a result, the company excluded from the depreciation and amortization caption $4.0 and $4.3 for the three months ended June 30, 2022 and 2021 and $8.3 and $8.7 for the six months ended June 30, 2022 and 2021.

These are Non-GAAP financial measures used by management to enhance the understanding of our operating results. EBITDA and Adjusted EBITDA are key measures we use to evaluate our operational performance. We provide EBITDA and Adjusted EBITDA because we believe that investors and securities analysts will find EBITDA and Adjusted EBITDA to be useful measures for evaluating our operating performance and comparing our operating performance with that of similar companies that have different capital structures and for evaluating our ability to meet our future debt service, capital expenditures, and working capital requirements. However, EBITDA and Adjusted EBITDA should not be considered as alternatives to net income as a measure of operating results or as alternatives to cash flows from operating activities as a measure of liquidity in accordance with GAAP.

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3. Reconciliation of GAAP net loss and net loss attributable to Diebold Nixdorf, Incorporated to Non-GAAP net income (loss) and net income (loss) attributable to Diebold Nixdorf, Incorporated, and diluted GAAP EPS to Non-GAAP EPS ($ in millions, except per share data):

	Q2 2022						Q2 2021						YTD 6/30/2022						YTD 6/30/2021
	$			per share			$			per share			$			per share			$			per share
Net loss	$	(199.1	)	$	(2.52	)	$	(30.3	)	$	(0.39	)	$	(383.0	)	$	(4.85	)	$	(38.4	)	$	(0.48)
Net income (loss) attributable to noncontrolling interests		0.1			—			—			—			(0.7	)		—			—			0.01
Net loss attributable to Diebold Nixdorf, Incorporated	$	(199.2	)	$	(2.52	)	$	(30.3	)	$	(0.39	)	$	(382.3	)	$	(4.85	)	$	(38.4	)	$	(0.49	)
Restructuring and transformation expenses		78.3			0.99			30.4			0.39			78.3			0.99			53.6			0.69
Amortization of Wincor Nixdorf purchase accounting intangible assets (non-cash)		17.6			0.22			19.9			0.25			36.1			0.46			39.8			0.51
Held for sale non-core European retail business		5.3			0.07			—			—			11.7			0.15			—			—
Non-routine income/expense:
Legal/deal expense		0.8			0.01			1.7			0.02			1.9			0.02			2.3			0.03
North America ERP Impairment		—			—									38.4			0.49
Russia/Ukraine Impairment		—			—									16.8			0.21
Crisis in Ukraine costs		1.2			0.02									2.5			0.03
Divestitures and fixed asset sales		—			—			(1.3	)		(0.02	)		—			—			(1.9	)		(0.02	)
Impairment from facility closure		5.4			0.07			—			—			5.4			0.07			—			—
Inventory charge/gain		34.4			0.44			—			—			34.4			0.44			—			—
Other		0.8			0.01			(0.5	)		—			0.8			0.01			(0.8	)		(0.01	)
Non-routine (income)/expense, net		42.6			0.55			(0.1	)		0.02			100.2			1.27			(0.4	)		0.03
Valuation allowance		127.4			1.61			—			—			127.4			1.61			—			—
Tax impact (inclusive of allocation of discrete tax items)		(40.5	)		(0.51	)		(11.9	)		(0.15	)		(66.4	)		(0.84	)		(23.2	)		(0.30	)
Total adjusted net income (loss) (Non-GAAP measure)	$	31.6		$	0.38		$	8.0		$	0.10		$	(96.3	)	$	(1.22	)	$	31.4		$	0.40
Net income (loss) attributable to noncontrolling interests		0.1			—			—			—			(0.7	)		(0.01	)		—			—
Total adjusted net income (loss) attributable to Diebold Nixdorf, Incorporated (Non-GAAP measure)	$	31.5		$	0.38		$	8.0		$	0.10		$	(95.6	)	$	(1.21	)	$	31.4		$	0.40

Refer to note 1 for additional information on non-routine (income)/expense for the periods presented.

4. Net debt is calculated as follows ($ in millions):

	June 30, 2022			December 31, 2021			June 30, 2021
Cash, cash equivalents, restricted cash and short-term investments (GAAP measure)	$	281.3		$	423.2		$	232.4
Cash included in assets held for sale		3.4			3.1			5.2
Debt instruments		(2,422.5	)		(2,292.7	)		(2,351.6	)
Net debt (Non-GAAP measure)	$	(2,137.8)		$	(1,866.4	)	$	(2,114.0	)

We believe that given the significant cash, cash equivalents and short-term investments on its balance sheet that net cash against outstanding debt is a meaningful measure.

###

PR_22-4065

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EX-99.2

Exhibit 99.2

 

Shareholder Letter

Second Quarter 2022

Customer Stories

	Ann-Charlotte Bergstroem, Manager, Strategic Relationships & ATM FOREX “Since many of our customers are travelers, it’s very important that our ATMs are available around the clock, and it’s more efficient for us to partner with an expert in the ATM technology space. By using Diebold Nixdorf’s Managed Services solutions, we can keep downtime to a minimum, which gives us peace of mind to focus on serving our customers.”
	Sara Ahmad, Chief Executive Officer Al Qurtas Islamic Bank “The new [DN Series] devices are already getting our customers’ attention, and in our next phase, the ATM’s integrated cash recycling capabilities will enable us to optimize cash handling and provide our customers with innovative technology that improves their banking experience.”
	Michelle Lesh, Chief Commercial Officer Alfen “The demand for fast and reliable charging has grown rapidly in the last few years, with an increasing number of European retailers turning to Alfen for our market-leading solutions. Joining forces with a strong partner like Diebold Nixdorf will help Alfen maintain our high-quality standards in our services.”

2  |  Shareholder Letter / Q2 2022

To Our Shareholders

Our solutions were in demand during the second quarter as we saw an increase in sequential quarter-over-quarter total order entry and a record $1.4billion in backlog as of the end of June. We delivered on our prior commitments with sequential quarter-over-quarter improvement on several key measures, including 3% revenue growth, margin expansion, adjusted EBITDA, and cost-savings through our restructuring initiatives. Leading us to reaffirm our EBITDA guidance for the year.

Our laser-focus on our supply chain, especially accelerating revenue conversion, progressed in the second quarter with constructive customer conversations around options to prepay or assume a higher price due to inflationary pressures. To date, customers have been more responsive to the former option. We continue to talk with our customers and appreciate their understanding and willingness to work with us during this challenging macro-economic environment we all face.

In the second quarter we also continued to face inflationary pressures, uncertainty around financial markets, logistics and supply chain disruptions, challenges from the ongoing pandemic and the war in Ukraine. At the same time, we remained focused on delivering on our business objectives and saw sequential improvement in our performance across key metrics. We continue to expand our capabilities to serve our customers with best-in-class solutions. We also identified and are executing against $120m through our cost savings restructuring plan and have a clear line of sight to more than $30m in additional cost savings as we transform the business into a more customer centric, simpler model – operating at a lower cost – to drive growth across our core businesses.

Over the past several weeks, our company has worked quickly to take important steps to become more agile, customer-focused, and better equipped to face the challenges that come our way in this difficult environment. We recently implemented a new and simplified operating model that will help us improve our financial performance, elevate customer service and put us on a path toward a stronger future. We have confidence in our operating model to drive us forward and double our efforts on what matters most – our customers.

Going forward, in addition to talking about Banking and Retail, we will be talking about our business in terms of Product and Services. This segment and business line reporting is representative of our simplified operating structure and how we run our business and measure success.

We continue to add value through our core businesses as our customers are seeking self-service and automation to meet the needs of changing customer preferences. In Banking, we address the demand for cash recyclers as banks rethink their branch footprint and move toward more automation and efficiency around their real estate. In Retail, we provide best-in-class, innovative self-checkout (SCO) solutions, which are increasingly sought after by retailers as they navigate rapidly changing labor dynamics and customer demand for improved shopping experiences.

Product and Services provide a holistic view of how we operate our business and why we continue to be our customers’ preferred partner. With Product, our continuous focus on innovation and providing the latest and greatest products and solutions is why we continue to win market share, especially with our cash recyclers and SCOs. Our global Services organization is one of our best assets, and we expect to grow our footprint with more advanced Managed Services as clients look to outsource more of their business.

3  |  Shareholder Letter / Q2 2022

Throughout this letter we will detail our Q2 2022 performance with a focus on the following highlights:

· Continued shift from legacy systems to DN Series^TM ATMs as the latter, specifically cash recyclers, composed 82% of total new Banking orders in North America in Q2

· Momentum for Retail remained strong with our self-checkout (SCO) business growing faster than the market in Europe

· Growth of 79% YoY in connected devices for our DN AllConnect^SM Data Engine

· Continued growth and progress for our electric vehicle (EV) charging stations services initiative

· Progress with ESG/DEI initiatives, including our Employee Resource Groups (ERGs) hosting several events around the globe including observance of the Juneteenth holiday in the U.S.

In the coming quarters, we look forward to continuing to meet the needs of our customers by providing innovative solutions and outstanding service they’re accustomed to receiving from us as we continue delivering on our growth and financial performance for our valued shareholders and debtholders.

4  |  Shareholder Letter / Q2 2022

Business Highlights

Banking

In Q2 2022, order entry for our banking solutions remained strong and was up 6% sequentially driven by demand from the U.S. and Brazil. Our DN Series ATM solutions are now live in over 90 countries with more than 570 certifications, and we continue to see the shift away from our legacy devices with our DN Series cash recyclers comprising 82% of new banking orders in North America. Additionally, approximately 63% of the total product backlog for Banking is composed of DN Series solutions.     In the second quarter we:   ·   Secured an approximately $8 million deal with one of the largest banks in Egypt including expansion of their fleet to now ~50% DN Series devices including cash recyclers as well as a software win for our DN Vynamic^TM software suite, and a six-year maintenance and support contract for these solutions.   ·   Won an approximately $6 million Managed Services deal for a large bank in India. This is a new contract which was achieved through our comprehensive solution set, including ATM monitoring, event management, help desk, cash forecasting, and site maintenance.   ·   Secured an approximately $5 million contract with a major U.S.-based financial institution operating in ~30 states to refresh their existing fleet of ATMs with the DN Series – displacing a competitor.   ·   Won an approximately $7 million deal in Germany with a pan-European commercial bank including DN Series devices and a 5-year services contract expanding our services or contract base (cBase) for devices. With this deal, their fleet of DN devices in Germany will expand to >80%.   

We continue to execute well on our payments initiative. One of the largest U.S. banks, already well underway in implementing our Vynamic Payments^TM software to replace their debit switch, has now contracted with Diebold Nixdorf to also replace their credit switch with Vynamic Payments. We also won a competitive RFP and proof of concept process with a European processor and are currently engaged in proof of concepts with multiple banks, with a strong sales pipeline for the remainder of the year.

5  |  Shareholder Letter / Q2 2022

Our AllConnect Data Engine continues to see growth with 79% more self-service devices connected to this solution year-over-year versus Q2 2021. Because of the war in Ukraine, we have reduced our year-end target to 215,000 connected devices, removing the 10,000 units located in Russia. We are still tracking to this goal, which equates to approximately 40% of all Diebold Nixdorf devices serviced, by the end of 2022. As a reminder, as DN connects more DN Series units to our ACDE platform, there is an opportunity to further optimize services margins.

Retail

Our SCO products continue to drive our Retail business with these solutions growing faster than the market, specifically in Europe. The evolution of consumer behavior along with labor shortages and wage inflation continues to drive increased demand for our self-service and automation. Additionally, we continue to look for ways to deploy one of our best assets – our Services organization – and continue to make progress with our EV charging station services business. This is an opportunity that originated through our retailer customer relationships and is a great example of a Services horizontal that aligns with our core business.   In the second quarter we:   ·   Secured an approximately $20 million win with a conglomerate that encompasses both high-end retail stores and grocery in the UK for SCO replacements as well as a five-year contract for services, including maintenance.   ·   We continue to make progress with our SCO solutions in the U.S. as we won an approximately $5 million contract for a U.S.-based chain of specialty discount stores for these products and are accelerating deployments with large European grocers across the U.S.   ·   For EV, we extended our pilot with Chargepoint to additional regions; went live with Alfen and added eight additional countries; became a member of ChargeUp (an organization focused on EV); and added countries and retail projects with Compleo. We continue to track to our goal of servicing 30,000 or more units by the end of this year.     

Demand for our SCO suite continues to drive momentum in 2022, contributing to growth in our Retail business, whereas EPOS remains largely stable. Increased SCO deployments provide an opportunity to capture more services business as we generally have a high attachment rate for services with SCO devices. Additionally, we look forward to more opportunities, like EV, where we can leverage our Managed Services organization and add horizontals or verticals that are a good fit for our operating model.

6  |  Shareholder Letter / Q2 2022

ESG and DEI Initiatives

We recognize all the ways that our organization touches and impacts the world around us, and we remain focused on our commitment to diversity and sustainability. Our 2021 Environmental, Sustainability and Governance (ESG) Report, which includes a comprehensive overview of our accomplishments to date, will be available in the coming weeks.
In the second quarter we:
·   Hosted two Purple Table Talks on the importance of Allyship and Financial Literacy, had two eternal speakers in Celebration of Pride month and nine additional events around the globe through our Employee Resource Groups (ERGs) as well as observed the Juneteenth holiday on June 20 in the U.S.
·   Collaborated and engaged with two of our largest data center providers in the U.S. on the topic of environmental sustainability. Our data center partners have strong commitments to source 100% of their energy needs from renewable energy by 2030 and shared their expectation to avoid over five million metric tons of CO2 annually. We plan to extend this collaboration and engagement outside of the U.S. through the end of 2022.
·   Worked on an internal employee engagement platform that will launch in the near future and will allow Diebold Nixdorf employees to report on various environmental and sustainability initiatives they are practicing and implementing to support our overall ESG goal. We intend to use this platform to learn and share experiences with our global employees to promote Diebold Nixdorf’s sustainability program globally and to share results in future reporting.

7  |  Shareholder Letter / Q2 2022

Financial Summary

Second Quarter 2022

Total Revenue ($M)

GAAP Revenue	Non-GAAP Revenue	·   Reported revenue was up sequentially 3% with the improvement driven by product sales and down 10% on a year-over-year basis due to $58 million from unfavorable FX and approximately $28 million from divestitures including Ukraine/Russia, with the remainder of the year-over-year decline due to supply chain impacts, installation delays and exiting certain low margin service contracts.
$944 $830 $852 $944 $824 $846 Q2-21 Q1-22 Q2-22 Q2-21 Q1-22 Q2-22
Gross Profit ($M) & Gross Margin
GAAP Gross Profit & Gross Margin	Non-GAAP Gross Profit & Gross Margin	·   GAAP Gross Profit and Margin decreased sequentially and year-over-year as a result of one-time charges recorded in Q2 2022 for an inventory reserve on legacy product which will no longer be sold and severance accruals for employees exiting the simplified organization. Non-GAAP Gross Profit and Margin increased sequentially, driven by price increases beginning to take hold. However, they decreased as compared to Q2 2021 due primarily to FX, lower volume, and higher non-GAAP non-billable inflation associated with supply chain disruptions.
$252 $185 $161 $262 $186 $210 26.7% 22.3% 18.9% 27.7% 22.5% 24.8% Q2-21 Q1-22 Q2-22 Q2-21 Q1-22 Q2-22
Operating Profit ($M) & Operating Margin
GAAP Operating Profit & Operating Margin	Non-GAAP Operating Profit & Operating Margin	·   GAAP Operating Profit and Margin decreased from the prior periods presented as a result of $78M in restructuring charges and a $34M inventory write-off of legacy products in Q2 2022.
$13 ($83) ($92) $63 ($1) $52 1.4% (10.1)% (10.7)% Q2-21 (0.1)% 6.7% 6.2% Q1-22 Q2-22 Q2-21 Q1-22 Q2-22		·   Non-GAAP Operating Profit and Margin increased sequentially driven by our focus on cost management and pricing, but decreased year-over-year as a result of lower gross profit despite operating expense favorability.
EBITDA ($M) & EBITDA Margin1
EBITDA1 & EBITDA Margin1	Adj. EBITDA1 & Adj. EBITDA1	·   The EBITDA metrics are directly attributable to the change in operating margins. Depreciation and amortization continue to decline as a result of consecutive years of reduced capital expenditures.
$45 4.7% ($53) (6.4)% ($54) (6.3)% $86 9.1% $15 1.8% $71 8.3% Q2-21 Q1-22 Q2-22 Q2-21 Q1-22 Q2-22

1) Non-GAAP metric. See “Use of Non-GAAP Financial Information” and the Financial Tables in the back of this document for additional information.

8  |  Shareholder Letter / Q2 2022

GAAP Net Loss ($M)

Net Loss ($30) Q2-21 ($184) Q1-22 ($199) Q2-22		·   Net Loss has grown since the prior periods presented as a result of the Q2 2022 restructuring and inventory charges previously mentioned, as well as a Q2 2022 $129 million valuation allowance recorded against deferred tax assets.
Product Related Order Entry & Backlog ($M)
Order Entry	Product Related Backlog
$515 $439 $466 6% $1,107 $1,235 11% $1,372 Q2-21 Q1-22 Q2-22 Q2-21 Q1-22 Q2-22		·   Order Entry, a forward-looking indicator of revenue, remained strong and was up sequentially, but down on a year-over-year basis due to FX and a challenging prior year comparison. ·   Backlog increased 24% closing Q2 at a record of approximately $1.4 billion, fueled by continued demand for our Banking & Retail products.

1) Non-GAAP metric. See “Use of Non-GAAP Financial Information” and the Financial Tables in the back of this document for additional information.

9  |  Shareholder Letter / Q2 2022

Financial Discussion

Second Quarter 2022

Banking Highlights

As discussed earlier in this letter, and in connection with our new operating model and simplified structure, the reportable segments are Banking and Retail. From this quarter forward, and consistent with how we manage the business, we will be disclosing Banking on a global basis vs. Americas and Eurasia.

Revenue ($M) $639 $598 $563 $590 Q2-21 Q2-21** Q1-22 Q2-22	Banking Revenue improved sequentially by 5% with improvement in both products and services. Excluding the $29m impact of unfavorable FX and $11M from divestitures including Russia/Ukraine, revenue was negatively affected by supply chain / logistics headwinds and terminated services contracts.
Gross Profit ($M) & Margin
$184 28.9% $170 28.5% $126 22.4% $148 25.0% Q2-21 Q2-21** Q1-22 Q2-22	Banking Gross Profit and Gross Margin improved sequentially based on higher revenue, realization of pricing actions and reduced spending on spot buys and expedited freight. The year-over-year decline was primarily due to inflationary impacts (materials / logistics) and to a lesser degree, decreased revenue, and unfavorable country / product mix.

** Presented on a constant currency basis and excluding divestitures and Russia/Ukraine impact (Non-GAAP metric)

Note: There is no difference between GAAP and non-GAAP segment results; as the GAAP to non-GAAP adjustments are not assigned to the segment, as these adjustments relate to items that are considered non-routine in nature and thus do not impact the way in which the business is managed or performance is assessed.

10  |  Shareholder Letter / Q2 2022

Retail Highlights

Revenue ($M)
$305 $255 $262 $256 Q2-21 Q2-21** Q1-22 Q2-22	Retail revenue was down on a sequential basis due to timing of installations and flat year-over-year after adjusting for currency and divestitures.
Gross Profit ($M) & Margin $78 25.4% $67 26.0% $60 23.0% $62 24.4% Q2-21 Q2-21** Q1-22 Q2-22	Retail Gross Profit and Margin improved sequentially with improvements across product and service and as a result of solution and geographical mix, as well as cost management initiatives. The year-over-year decline was primarily due to lower revenues, heightened inflation (particularly in products) and sequencing of pricing actions.

** Presented on a constant currency basis and excluding divestitures and Russia/Ukraine impact (Non-GAAP metric)

Note: There is no difference between GAAP and non-GAAP segment results; as the GAAP to non-GAAP adjustments are not assigned to the segment, as these adjustments relate to items that are considered non-routine in nature and thus do not impact the way in which the business is managed or performance is assessed.

11  |  Shareholder Letter / Q2 2022

Services and Product Gross Profit and Margins

GAAP Services Gross Profit ($M) & Margin $177 30.1% $152 28.9% $150 28.6% Q2-21 Q1-22 Q2-22	GAAP Services Margins decreased sequentially largely as a result of Q2 2022 severance charges impacting the services organization. Non-GAAP Services Margins increased sequentially as a result of cost optimization initiatives tied to our organizational simplification. GAAP and Non-GAAP Services Margins decreased on a year-over-year basis due to lower revenues as a result of FX, lower high-margin attached Services and inflationary wage and logistics costs.
Non-GAAP Services Gross Profit1 ($M) & Margin $185 31.5% $171 31.8% $153 29.3% $159 30.3% Q2-21 Q2-21** Q1-22 Q2-22
GAAP Products Gross Profit ($M) & Margin $75 21.0% $33 11.0% $11 3.2% Q2-21 Q1-22 Q2-22	GAAP Products Margins decreased sequentially and year- over-year as a result of a $34M inventory write-off in Q2 2022 as a result of a management initiative to focus on the core business and discontinue certain legacy products. Non-GAAP Products Margins increased sequentially due to early indications of price increases from the backlog flowing through and cost management initiatives. On a year-over-year basis margins declined due to continued elevated Product inflationary costs (raw materials / freight) in relation to an otherwise normalized cost period (Q2 2021).
Non-GAAP Products Gross Profit1 ($M) & Margin $77 21.5% $66 20.9% $33 11.1% $51 15.9% Q2-21 Q2-21** Q1-22 Q2-22

** Presented on a constant currency basis and excluding divestitures and Russia/Ukraine impact (Non-GAAP metric)

12  |  Shareholder Letter / Q2 2022

Free Cash Flow, Leverage and Debt Maturities

Levered & Unlevered Free Cash Flow¹

  $101 2021 $276 $123 Q2 2021 Q2 2022 ($80) ($52) ($79) ($89) ($61) ($80) Unlevered free cash use of $61 million in the quarter reflects lower EBITDA and higher cash use on net working capital driven by supply chain challenges.   Leverage ratio² increased to 6.8x with net debt³ of $2,138M and TTM adjusted EBITDA¹ of $315M   Available liquidity³ of $210M

Debt Maturities

FacilitiesBalances as of June 30, 2022 ($M) Interest Rate index & Margin"Maturity Dates Revolving Credit($330 at 6/30/22) 5Term Loan B US$Term Loan B¬US$ SeniorUnsecured Notes due 2024 US$ Senior Secured Notes due 2025¬ Senior Secured Notes due 2025 $253 $383 $346 $400 $700 $364 $253 $383 $346 $400 $700 $364 LIBOR +4.50% LIBOR +2.75% EURIBOR+3.00% 8.50% 9.38% 9.00% July 2023 November 2023 November 2023 April 2024 July 2025 July 2025

1) Non-GAAP metric. See “Use of Non-GAAP Financial Information” and “Supplemental Slides” for further information.

2) Leverage ratio is defined as net debt to trailing 12-month adjusted EBITDA. Ending cash balance includes $3.4M of cash in assets held for sale, which was not realized as of June 30, 2022.

3) Net debt and liquidity as of June 30, 2022. Net debt is a non-GAAP financial measure defined as notes payable plus long-term debt less cash, cash equivalents, short-term investments, and cash expected to be realized from assets held for sale. Available liquidity includes a portion of total cash and short-term investments plus available borrowing under the revolving credit facility, less letters of credit.

4) LIBOR and EURIBOR rates are subject to certain floors.

5) Capacity under the revolving credit facility is $330 at June 30, 2022, which reflects a reduction of $39 from December 31, 2021.

13  |  Shareholder Letter / Q2 2022

Outlook for 2022

Total Revenue Adjusted EBITDA1 Free cash flow2 ROIC3 2022 Previous $3.7 - $3.9B 2022 Revised $3.55 - $3.75B Key Expectations4 Change is primarily the result of FX headwinds, Primarily related to the weakening of the euro in comparison to the US dollar $320 - $350M $320 - $350M Revenue decline is offset by additional cost savings opportunites Break even Break even No change based on the EBITDA guidance remaining consisted and working capital management -13% -13% No change

1 - With respect to the company’s adjusted EBITDA and Return on Invested Capital (ROIC) outlook for 2022, it is not providing a reconciliation to the most directly comparable GAAP financial measures because it is unable to predict with reasonable certainty those items that may affect such measures calculated and presented in accordance with GAAP without unreasonable effort. These measures primarily exclude future restructuring actions and net non-routine items. These reconciling items are uncertain, depend on various factors and could significantly impact, either individually or in the aggregate, operating profit and net income calculated and presented in accordance with GAAP. Please see “Non-GAAP Financial Measures and Other Information” for additional information regarding our use of non-GAAP financial measures.

2 - Free cash flow is a non-GAAP financial measure defined as net cash provided by operating activities from continuing operations less capital expenditures, less cash used for capitalized software development, and excluding the impact of changes in cash of assets held for sale and the use of cash for M&A and the legal settlement for impaired cloud implementation costs and excluding the use of cash for the settlement of foreign exchange derivative instruments. With respect to the company’s non-GAAP free cash flow outlook for 2022, it is not providing a reconciliation to the most directly comparable GAAP financial measure because it is unable to predict with reasonable certainty those items that may affect such measure calculated and presented in accordance with GAAP without unreasonable effort. This measure primarily excludes the future impact of changes in cash of assets held for sale, cash used for M&A activities and the settlement of foreign exchange derivative instruments. These reconciling items are uncertain, depend on various factors and could significantly impact, either individually or in the aggregate, net cash provided (used) by operating activities calculated and presented in accordance with GAAP. Please see “Non- GAAP Financial Measures and Other Information” for additional information regarding our use of non-GAAP financial measures.

3 - ROIC is defined as tax-effected adjusted operating profit (NOPAT), utilizing an estimated 30% effective tax rate, divided by average invested capital for the period.

4 - Key expectations explain changes from guidance provided in May 2022.

14  |  Shareholder Letter / Q2 2022

Discussion of Financial Outlook

For our 2022 financial outlook, we are reiterating our 2022 adjusted EBITDA guidance range.

We also are reiterating our 2022 Free Cash Flow outlook, which is directly correlated with our expected adjusted EBITDA guidance range as well as working capital normalization. The Free Cash Flow guidance includes cash restructuring charges.

Our adjusted 2022 revenue guidance is primarily due to FX.

We remain encouraged by our order entry activity, a forward-looking indicator of demand, and are confident in our operating model as we implement cost savings and additional operational rigor to accelerate the pace of the backlog conversion to revenue. Also, as noted we ended the quarter with ~$1.4 billion in backlog and expect to cross into 2023 with approximately $1.2 billion of backlog.

In terms of inflation, in the first half of 2022 we experienced 11% inflation and expect the full year inflation to moderate to approximately 7 to 8% by year-end.

With respect to our cost savings plan, initiated in May, to streamline operations, focus the organization on our customers, drive efficiencies, and automate processes – we have identified and are executing against approximately $120 million through our cost-savings restructuring plan and have a clear line of sight to more than $30 million in additional cost-savings.

This quarter we also thought it would be helpful to provide some additional color on our business, financial model and growth in our markets.

In terms of secured and recurring revenue for 2022:

● Approximately 70% of our Services revenue is recurring given the contractual nature of this business

● In excess of 90% of our total company revenue is secured via either contract or scheduled backlog/committed spend; we expect the remainder to come from billed work and scheduling of current professional services backlog

● Approximately $920m of backlog is scheduled to be delivered in 2022 implying a 1.4x book-to-bill ratio as of Q2 2022 and ~70% coverage of product revenue (note for a more normalized view, average book-to-bill ratio was 1.1x in 2020)

Note as we mentioned last quarter, our product or hardware revenue is correlated to installations which fall under Services revenue. Installation revenue, license revenue, professional services and billable work are all part of non-recurring revenue. Additionally, product revenue is generally not recognized until the device is installed – hence the correlation between product revenue and installations.

With respect to Banking and both our installed base of ATMs and our contract base (cBase) we are providing the following details (note these are global numbers):

● We have an installed base of ~800k ATMs¹ after excluding certain non-cash kiosk and dispensing units out of which ~250k that are located where DN does not have a service presence, leaving an addressable service base of ~550k

¹  This excludes China and India and ~100k non-cash kiosk and dispensing units

15  |  Shareholder Letter / Q2 2022

● We provide product related services (PRS) to over 480k ATMs with a renewal rate greater than 95% (generally the primary fluctuation in cBase is due to machines being removed); and

● The difference between installed base and cBase is primarily a result of markets where Diebold Nixdorf does not go to market or provide PRS services directly and instead partners with local distributors. The remaining gap is a function of banks servicing their own fleets.

We view this as an opportunity to convert more of our installed base to cBase where possible as well as add on additional more advanced services beyond PRS to our current cBase.

In terms of our Retail business, as noted in our Q4 2021 Shareholder Letter, we sold 21k SCO units and 132k EPOS units in 2021. We expect the following:

● SCO units sold to grow at a ~22% CAGR through 2024; and

● EPOS units sold to grow at a ~1% CAGR through 2024

Also, as noted previously, but as a reminder, the average services attachment rates for our SCO and EPOS businesses, are >90% and >30%, respectively, with both having contract renewal rates greater than 95%.

For further clarity with our financial model and 3-year targets, we are providing the following information:

● From 2022 to 2024, revenue is expected to grow ~3% annually;

● From 2022 to 2024, gross margin is expected to increase ~200 to 250bps as a percentage of revenue;

● From 2022 to 2024, SG&A is expected to decline ~150bps as a percentage of revenue and R&D is expected to trend downward 50bps as a percentage of revenue;

● Adjusted EBITDA margin is expected to contract 220bps in 2022 as a percentage of revenue, ultimately increasing to ~13% in 2024;

● From 2022 to 2024, unlevered free cash flow margin is modeled to expand from ~50% in 2022 to ~70% in 2024; and

● Forecasting to be in compliance with our total net leverage ratio covenant through 2022.

In 2023 and 2024, we expect:

● In 2023 / 2024, we expect to continue to close the gap between pricing and inflation via incremental price increases and modest inflation normalization – particularly as it relates to spot buys and freight. Otherwise, raw material costs are expected to remain at a similar elevated level in 2023 / 2024;

● Going forward, we believe that pricing will cover direct cost increases; and

● Continuous improvement efficiencies will be the primary cost of goods sold (COGS) savings contributor with ~$30m in 2023 and ~$25m in 2024. Also, ~$7m and ~$3m of COGS savings in 2023 and 2024, respectively, from the $150m+ cost savings plan.

Despite the macroeconomic challenges we are facing in 2022, we believe the trends in our business and markets we serve are favorable for Diebold Nixdorf and will support our 3-year targets and return to growth and profitability. With our focus on operational rigor and simplification of our business, we believe we are well-positioned to capitalize on the strong demand for our solutions and deliver value to our shareholders.

16  |  Shareholder Letter / Q2 2022

Non-GAAP Financial Measures and Other Information

To supplement our condensed consolidated financial statements presented in accordance with GAAP, the company considers certain financial measures that are not prepared in accordance with GAAP, including non-GAAP results, adjusted diluted earnings per share, free cash flow (use) and unlevered free cash flow (use), net debt, EBITDA, adjusted EBITDA and constant currency results. The company calculates constant currency by translating the prior year results at current year exchange rates. The company uses these non-GAAP financial measures, in addition to GAAP financial measures, to evaluate our operating and financial performance and to compare such performance to that of prior periods and to the performance of our competitors. Also, the company uses these non-GAAP financial measures in making operational and financial decisions and in establishing operational goals. The company also believes providing these non-GAAP financial measures to investors, as a supplement to GAAP financial measures, helps investors evaluate our operating and financial performance and trends in our business, consistent with how management evaluates such performance and trends. The company also believes these non-GAAP financial measures may be useful to investors in comparing its performance to the performance of other companies, although its non-GAAP financial measures are specific to the company and the non-GAAP financial measures of other companies may not be calculated in the same manner. We provide EBITDA and Adjusted EBITDA because we believe that investors and securities analysts will find EBITDA and adjusted EBITDA to be useful measures for evaluating our operating performance and comparing our operating performance with that of similar companies that have different capital structures and for evaluating our ability to meet our future debt service, capital expenditure and working capital requirements. We are also providing EBITDA and adjusted EBITDA in light of our credit agreement and the secured and unsecured senior notes. We consider free cash flow (use) to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that, after the purchase of property and equipment and capitalized software development, changes in cash of assets held for sale and the use of cash for M&A and the legal settlement for impaired cloud implementation costs, and excluding the use/proceeds of cash for the settlement of foreign exchange derivative instruments, can be used for debt servicing, strategic opportunities, including investing in the business, making strategic acquisitions, strengthening the balance sheet and paying dividends. Unlevered free cash flow (use) provides incremental visibility into the company’s liquidity by excluding cash used for interest payments from free cash flow (use). For more information, please refer to the section, “Notes for Non-GAAP Measures.”

Differences throughout may occur due to rounding.

Segment Reporting Structure

As previously mentioned, the company reorganized its reportable segments due to the simplification of its organizational structure. The new reportable segments are Global Banking and Global Retail, which aligns with how the company makes key operating decisions, allocate resources and assess performance going forward. The new Banking segment’s sales and cost of sales are the summation of the historical Americas Banking and Eurasia Banking segments. The segment change has no impact on Retail’s sales or cost of sales. Certain corporate costs and Non-GAAP adjustments are not assigned to our reportable segments, as these charges are managed separately from the segment information the company uses to make operating decisions and assess performance.

Also in connection with the operating structure simplification, the company will no longer be separately reporting software sales and software cost of sales in its earnings materials. Rather, and consistent with its historical reporting on Form 10-Q and Form 10-K, the company will report product and service sales and cost of sales. Software licenses are included in product, while software maintenance and support and professional services are reported within service.

Prior-periods have been recast to conform to the new reporting structure. Reconciliations between the new and historical format are included in the back of this shareholder letter. These changes did not impact the consolidated financial statements.

Forward-Looking Statements

This letter contains statements that are not historical information and are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding potential impact of the ongoing coronavirus (COVID-19) pandemic, anticipated operating results, future liquidity and financial position.

Statements can generally be identified as forward looking because they include words such as “believes,” “anticipates,” “expects,” “could,” “should” or words of similar meaning. Statements that describe the company’s future plans, objectives or goals are also forward-looking statements. Forward-looking statements are subject to assumptions, risks and uncertainties that may cause actual results to differ materially from those contemplated by such forward-looking statements. The factors that may affect the company’s results include, among others:

17  |  Shareholder Letter / Q2 2022

● the overall impact of global supply chain complexities on the company and its business, including delays in sourcing key components as well as longer transport times, especially for container ships and U.S. trucking, given the company’s reliance on suppliers, subcontractors and availability of raw materials and other components;

● the ultimate impact of the ongoing COVID-19 pandemic, and other public health emergencies, including further adverse effects to the company’s supply chain, maintenance of increased order backlog, and the effects of any COVID-19 related cancellations;

● the company’s ability to successfully meet its cost-reduction goals and to continue to achieve benefits from its cost-reduction initiatives and other strategic initiatives, such as the current $150m+ cost savings plan;

● the success of the company’s new products, including its DN Series line and EASY family of retail checkout solutions;

● the impact of a cybersecurity breach or operational failure on the company’s business;

● the company’s ability to generate sufficient cash to service its debt or to comply with the covenants contained in the agreements governing its debt and to successfully refinance its debt;

● the company’s ability to attract, retain and motivate key employees;

● changes in the company’s intention to further repatriate cash and cash equivalents and short-term investments residing in international tax jurisdictions, which could negatively impact foreign and domestic taxes;

● the company’s success in divesting, reorganizing or exiting non-core and/or non-accretive businesses and its ability to successfully manage acquisitions, divestitures, and alliances;

● the ultimate outcome of the appraisal proceedings initiated in connection with the implementation of the Domination and Profit Loss Transfer Agreement with the former Diebold Nixdorf AG (which was dismissed in the Company’s favor at the lower court level in May 2022) and the merger/squeeze-out;

● the impact of market and economic conditions, including the proliferation of cash and any deterioration or disruption in the financial and service markets, including the bankruptcies, restructurings or consolidations of financial institutions, which could reduce the company’s customer base and/or adversely affect its customers’ ability to make capital expenditures, as well as adversely impact the availability and cost of credit;

● the impact of competitive pressures, including pricing pressures and technological developments;

● changes in political, economic or other factors such as currency exchange rates, inflation rates (including the impact of possible currency devaluations in countries experiencing high inflation rates), recessionary or expansive trends, hostilities or conflicts (including the conflict between Russia and Ukraine), disruption in energy supply, taxes and regulations and laws affecting the worldwide business in each of the company’s operations;

● the company’s ability to maintain effective internal controls;

● unanticipated litigation, claims or assessments, as well as the outcome/impact of any current/pending litigation, claims or assessments;

● the effect of changes in law and regulations or the manner of enforcement in the U.S. and internationally and the company’s ability to comply with government regulations; and

● other factors included in the company’s filings with the SEC, including its Annual Report on Form 10-K for the year ended December 31, 2021 and in other documents the company files with the SEC.

You should consider these factors carefully in evaluating forward-looking statements and are cautioned not to place undue reliance on such statements. The company assumes no obligation to update any forward-looking statements, which speak only to the date of this document.

18  |  Shareholder Letter / Q2 2022

Supplemental Schedules

Q2 2022 QTD Profit & Loss Statement

Reconciliation of GAAP to Non-GAAP ($ in Millions)

	Q2 2022 (GAAP)			% of Net Sales			Restructuring & Transformation expenses			Amortization of Wincor Nixdorf purchase accounting intangible assets (non-cash)			Held for sale non-core European retail business			Legal / Deal expense			Crisis in Ukraine Costs			Impairment from Facility Closure			Inventory Charge/(Gain)		Other non- routine income / expense		Q2 2022 (non-GAAP)		% of Net Sales
Services		525.4			61.7	%		—			—			(0.8	)		—			—			—			—		—		524.6		62.0	%
Products		326.3			38.3	%		—			—			(4.9	)		—			—			—			—		—		321.4		38.0	%
Total Revenue		851.7			100.0	%		—			—			(5.7	)		—			—			—			—		—		846.0		100.0	%
Services		150.3			28.6	%		4.4			—			2.9			—			—			—			—		1.1		158.7		30.3	%
Products		10.5			3.2	%		8.7			—			(2.4	)		—			—			—			34.4		—		51.2		15.9	%
Total Gross Profit		160.8			18.9	%		13.1			—			0.5			—			—			—			34.4		1.1		209.9		24.8	%
Operating Expenses		—						—			—			—			—			—			—			—		—		—
Selling, G & A		213.8						(57.9	)		(17.6	)		(3.2	)		(0.8	)		(1.2	)		—			—		0.3		133.4
R, D, & E		33.1						(7.3	)		—			(1.6	)		—			—			—			—		—		24.2
(Gain)Loss of Sale		—						—			—			—			—			—			—			—		—		—
Impairment of Assets		5.4						—			—			—			—			—			(5.4	)		—		—		—
Total Operating Expenses		252.3			29.6	%		(65.2	)		(17.6	)		(4.8	)		(0.8	)		(1.2	)		(5.4	)		—		0.3		157.6		18.6	%
Total Operating Profit (Loss)		(91.5	)		-10.7	%		78.3			17.6			5.3			0.8			1.2			5.4			34.4		0.8		52.3		6.2	%

Q2 2021 QTD Profit & Loss Statement

Reconciliation of GAAP to Non-GAAP ($ in Millions)

	Q2 2021 (GAAP)			% of Net Sales			Restructuring & Transformation expenses			Amortization of Wincor Nixdorf purchase accounting intangible assets (non-cash)			Legal / Deal expense			Divestiture of Fixed Assets			Other non- routine income / expense			Q2 2022 (non-GAAP)			% of Net Sales
Services		586.7			62.2	%		—			—			—			—			—			586.7			62.2	%
Products		356.8			37.8	%		—			—			—			—			—			356.8			37.8	%
Total Revenue		943.5			100.0	%		—			—			—			—			—			943.5			100.0	%
Services		176.8			30.1	%		10.1			—			—			—			(1.9	)		185.0			31.5	%
Products		75.1			21.0	%		1.1			—			—			—			0.6			76.8			21.5	%
Total Gross Profit		251.9			26.7	%		11.2			—			—			—			(1.3	)		261.8			27.7	%
Operating Expenses		—						—			—			—			—			—			—
Selling, G & A		204.8						(19.2	)		(19.9	)		(1.7	)		—			(0.8	)		163.2
R, D, & E		35.6						—			—			—			—			—			35.6
(Gain)Loss of Sale		(1.4	)					—			—			—			1.3			—			(0.1	)
Impairment of Assets		—						—			—			—			—			—			—
Total Operating Expenses		239.0			25.3	%		(19.2	)		(19.9	)		(1.7	)		1.3			(0.8	)		198.7			21.1	%
Total Operating Profit (Loss)		12.9			1.4	%		30.4			19.9			1.7			(1.3	)		(0.5	)		63.1			6.7	%

19  |  Shareholder Letter / Q2 2022

Q2-22 v Q2-21 QTD Revenue Reconciliation

Segment View ($ in Millions)

	Q2-22			Q2-21			Variance F/(U)			Variance %
Banking Revenue (GAAP)		590.2			638.5			(48.3	)		-7.6	%
FX Impact		-			(29.2	)
Held for sale non-core European retail business		-			-
Divestitures and Related Actions		-			(2.2	)
Russia / Ukraine Impact		-			(8.9	)
Banking Adjusted Revenue (Non-GAAP)		590.2			598.2			(8.0	)		-1.3	%
Retail Revenue (GAAP)		261.5			305.0			(43.5	)		-14.2	%
FX Impact		-			(28.4	)
Held for sale non-core European retail business		(5.7	)		(5.2	)
Divestitures and Related Actions		-			(7.7	)
Russia / Ukraine Impact		-			(8.9	)
Retail Adjusted Revenue (Non-GAAP)		255.8			254.8			1.0			0.4	%
Total Revenue (GAAP)		851.7			943.5			(91.8	)		-9.7	%
Fx Impact		-			(57.6	)
Held for sale non-core European retail business		(5.7	)		(5.2	)
Divestitures and Related Actions		-			(9.9	)
Russia / Ukraine Impact		-			(17.8	)
Total Adjusted Revenue (Non-GAAP)		846.0			853.0			(7.0	)		-0.8	%

Business Line View ($ in Millions)

	Q2-22			Q2-21			Variance F/(U)			Variance %
Services Revenue (GAAP)		525.4			586.7			(61.3	)		-10.4	%
FX Impact		-			(32.4	)
Held for sale non-core European retail business		(0.8	)		(2.8	)
Divestitures and Related Actions		-			(7.0	)
Russia / Ukraine Impact		-			(6.5	)
Services Adjusted Revenue (Non-GAAP)		524.6			538.04			(13.4	)		-2.5	%
Products Revenue (GAAP)		326.3			356.8			(30.5	)		-8.5	%
FX Impact		-			(25.2	)
Held for sale non-core European retail business		(4.9	)		(2.4	)
Divestitures and Related Actions		-			(2.9	)
Russia / Ukraine Impact		-			(11.3	)
Products Adjusted Revenue (Non-GAAP)		321.4			315.0			6.4			2.0	%
Total Revenue (GAAP)		851.7			943.5			(91.8	)		-9.7	%
Fx Impact		-			(57.6	)
Held for sale non-core European retail business		(5.7	)		(5.2	)
Divestitures and Related Actions		-			(9.9	)
Russia / Ukraine Impact		-			(17.8	)
Total Adjusted Revenue (Non-GAAP)		846.0			853.0			(7.0	)		-0.8	%

20  |  Shareholder Letter / Q2 2022

Q2-22 v Q2-21 QTD Gross Profit Reconciliation

Segment View ($ in Millions)

	Q2-22		Q2-21			Variance F/(U)			Variance %
Banking Gross Profit		147.5		184.3			(36.8	)		-20.0	%
FX Impact		-		(12.8	)
Held for sale non-core European retail business		-		-
Divestitures and Related Actions		-		0.1
Russia / Ukraine Impact		-		(1.4	)
Banking Adjusted Gross Profit (Non-GAAP)		147.5		170.2			(22.7	)		-13.3	%
Retail Gross Profit1		61.9		77.5			(15.6	)		-20.1	%
FX Impact		-		(6.3	)
Held for sale non-core European retail business		0.5		(0.8	)
Divestitures and Related Actions		-		(2.2	)
Russia / Ukraine Impact		-		(1.7	)
Retail Adjusted Gross Profit (Non-GAAP)		62.4		66.5			(4.1	)		-6.2	%
Total Gross Profit1		209.4		261.8			(52.4	)		-20.0	%
Fx Impact		-		(19.1	)
Held for sale non-core European retail business		0.5		(0.7	)
Divestitures and Related Actions		-		(2.1	)
Russia / Ukraine Impact		-		(3.1	)
Total Adjusted Gross Profit (Non-GAAP)		209.9		236.7			(26.8	)		-11.3	%

Business Line View ($ in Millions)

	Q2-22			Q2-21			Variance F/(U)			Variance %
Services Gross Profit1		155.8			185.0			(29.2	)		-15.8	%
FX Impact		-			(11.9	)
Held for sale non-core European retail business		2.9			1.2
Divestitures and Related Actions		-			(2.0	)
Russia / Ukraine Impact		-			(1.3	)
Services Adj. Gross Profit (Non-GAAP)		158.7			171.0			(12.3	)		-7.2	%
Products Gross Profit1		53.6			76.8			(23.2	)		-30.2	%
FX Impact		-			(7.2	)
Held for sale non-core European retail business		(2.4	)		2.0
Divestitures and Related Actions		-			(0.1	)
Russia / Ukraine Impact		-			(1.8	)
Products Adj. Gross Profit (Non-GAAP)		51.2			65.7			(14.5	)		-22.1	%
Total Gross Profit1		209.4			261.8			(52.4	)		-20.0	%
Fx Impact		-			(19.1	)
Held for sale non-core European retail business		0.5			(0.8	)
Divestitures and Related Actions		-			(2.1	)
Russia / Ukraine Impact		-			(3.1	)
Total Adjusted Gross Profit (Non-GAAP)		209.9			236.7			(26.8	)		-11.3	%

¹ Amounts include the impact of held for sale non-core European retail business for comparability purposes. Otherwise, there is no difference between GAAP and Non-GAAP segment results; as the GAAP to Non-GAAP adjustments shown in Note 1 of the Earnings Release are not assigned to the segments, as these adjustments relate to items that are considered non-routine in nature and thus do not impact the way in which the business is managed or performance is assessed.

21  |  Shareholder Letter / Q2 2022

Q2-22 v Q1-22 QTD Revenue Reconciliation

Segment View ($ in Millions)

	Q2-22			Q1-22			Variance F/(U)			Variance %
Banking Revenue (GAAP)		590.2			562.7			27.5			4.9	%
Held for sale non-core European retail business		-			-
Russia / Ukraine Impact		-			(5.9	)
Banking Adjusted Revenue (Non-GAAP)		590.2			556.8			33.4			6.0	%
Retail Revenue (GAAP)		261.5			267.1			(5.6	)		-2.1	%
Held for sale non-core European retail business		(5.7	)		(5.5	)
Russia / Ukraine Impact		-			(3.8	)
Retail Adjusted Revenue (Non-GAAP)		255.8			257.8			(2.0	)		-0.8	%
Total Revenue (GAAP)		851.7			829.8			21.9			2.6	%
Held for sale non-core European retail business		(5.7	)		(5.5	)
Russia / Ukraine Impact		-			(9.7	)
Total Adjusted Revenue (Non-GAAP)		846.0			814.6			31.4			3.9	%

Business Line View ($ in Millions)

	Q2-22			Q1-22			Variance F/(U)			Variance %
Services Revenue (GAAP)		525.4			526.2			(0.8	)		-0.2	%
Held for sale non-core European retail business		(0.8	)		(2.5	)
Russia / Ukraine Impact		-			(3.8	)
Services Adjusted Revenue (Non-GAAP)		524.6			519.9			4.7			0.9	%
Products Revenue (GAAP)		326.3			303.6			22.7			7.5	%
Held for sale non-core European retail business		(4.9	)		(3.0	)
Russia / Ukraine Impact		-			(5.9	)
Products Adjusted Revenue (Non-GAAP)		321.4			294.7			26.7			9.1	%
Total Revenue (GAAP)		851.7			829.8			21.9			2.6	%
Held for sale non-core European retail business		(5.7	)		(5.5	)
Russia / Ukraine Impact		-			(9.7	)
Total Adjusted Revenue (Non-GAAP)		846.0			814.6			31.4			3.9	%

22  |  Shareholder Letter / Q2 2022

Q2-22 v Q1-22 QTD Gross Profit Reconciliation

Segment View ($ in Millions)

	Q2-22		Q1-22			Variance F/(U)		Variance %
Banking Gross Profit		147.5		126.3			21.2		16.8	%
Held for sale non-core European retail business		-		-
Russia / Ukraine Impact		-		(0.3	)
Banking Adjusted Gross Profit (Non-GAAP)		147.5		126.0			21.5		17.1	%
Retail Gross Profit1		61.9		59.0			2.9		4.9	%
Held for sale non-core European retail business		0.5		0.8
Russia / Ukraine Impact		-		(0.5	)
Retail Adjusted Gross Profit (Non-GAAP)		62.4		59.3			3.1		5.2	%
Total Gross Profit1		209.4		185.3			24.1		13.0	%
Held for sale non-core European retail business		0.5		0.8
Russia / Ukraine Impact		-		(0.8	)
Total Adjusted Gross Profit (Non-GAAP)		209.9		185.3			24.6		13.3	%

Business Line View ($ in Millions)

	Q2-22			Q1-22			Variance F/(U)		Variance %
Services Gross Profit1		155.8			152.0			3.8		2.5	%
Held for sale non-core European retail business		2.9			1.5
Russia / Ukraine Impact		-			(0.8	)
Services Adj. Gross Profit (Non-GAAP)		158.7			152.7			6.0		3.9	%
Products Gross Profit1		53.6			33.3			20.3		61.0	%
Held for sale non-core European retail business		(2.4	)		(0.7	)
Russia / Ukraine Impact		-			-
Products Adj. Gross Profit (Non-GAAP)		51.2			32.6			18.6		57.1	%
Total Gross Profit1		209.4			185.3			24.1		13.0	%
Held for sale non-core European retail business		0.5			0.8
Russia / Ukraine Impact		-			(0.8	)
Total Adjusted Gross Profit (Non-GAAP)		209.9			185.3			24.6		13.3	%

¹ Amounts include the impact of held for sale non-core European retail business for comparability purposes. Otherwise, there is no difference between GAAP and Non-GAAP segment results; as the GAAP to Non-GAAP adjustments shown in Note 1 of the Earnings Release are not assigned to the segments, as these adjustments relate to items that are considered non-routine in nature and thus do not impact the way in which the business is managed or performance is assessed.

23  |  Shareholder Letter / Q2 2022

Q2 2022 QTD Adjusted EBITDA

($ in Millions)

	Q2 2022			Q2 2021
GAAP Revenue		851.7			943.5
GAAP Net Income		(199.1	)		(30.3	)
Income tax expense (benefit)		64.2			(11.2	)
Interest income		(1.0	)		(2.3	)
Interest expense		49.6			49.7
Depreciation and amortization		32.2			38.6
EBITDA		(54.1	)		43.5
Share-based compensation		5.2			4.5
Amortization of cloud-based software implementation costs		0.5			-
Foreign exchange (gain) loss, net		(2.3	)		9.2
Miscellaneous, net		(4.6	)		(2.7	)
Equity in earnings of unconsolidated subsidiaries		1.7			0.5
Restructuring and DN Now transformation expenses		77.4			30.4
Non-routine expenses, net		42.6			(0.1	)
Held for Sale Entities		4.4			-
Adjusted EBITDA		70.9			86.3
Adjusted EBITDA as a % of GAAP Revenue		8.3	%		9.1	%

Trailing 12-month Adjusted EBITDA

($ in Millions)

	Q2 2022			Q2 2021
GAAP Revenue		3,699.3			3,988.0
GAAP Net Income		(422.7	)		(189.7	)
Income tax expense (benefit)		152.8			(28.0	)
Interest income		(4.5	)		(7.0	)
Interest expense		194.6			295.0
Depreciation and amortization		136.0			164.0
EBITDA		56.3			234.0
Share-based compensation		12.7			15.0
Amortization of cloud-based software implementation costs		1.0			-
Foreign exchange (gain) loss, net		0.9			11.0
Miscellaneous, net		(8.6	)		(3.0	)
Equity in earnings of unconsolidated subsidiaries		0.5			1.0
Restructuring and DN Now transformation expenses		122.9			159.0
Non-routine expenses, net		119.1			11.0
Held for Sale Entities		9.9			-
Adjusted EBITDA		314.7			428.0
Adjusted EBITDA as a % of GAAP Revenue		8.5	%		10.7	%

The company defines EBITDA as net loss excluding income tax benefit/expense, net interest expense, and depreciation and amortization expense. Consistent with the company’s credit agreement, Adjusted EBITDA is EBITDA excluding the effects of the following items: share-based compensation, amortization of cloud-based software implementation costs, foreign exchange gain/loss net, miscellaneous net, equity in earnings of unconsolidated subsidiaries, restructuring and transformation expenses, non-routine expenses and the adjusted EBITDA loss of our held for sale non-core European retail business, as outlined in Note 1 of the non-GAAP measures. To remain comparable to the U.S. GAAP depreciation and amortization measures, the company excluded the amortization of Wincor Nixdorf purchase accounting intangible assets from non-routine expenses, net in the Adjusted EBITDA reconciliation of $17.6 and $19.9 for the three months ended June 30, 2022 and 2021 and $36.1 and $39.8 for the six months ended June 30, 2022 and 2021. Additionally, $0.8 of restructuring-related share-based compensation activity was excluded from restructuring and transformation expenses for the three and six months ended June 30, 2022 and $2.0 of accelerated depreciation expense for the six months ended June 30, 2021 was excluded from restructuring and transformation expenses. Deferred financing fees amortization is included in interest expense; as a result, the company excluded from the depreciation and amortization caption $4.0 and $4.3 for the three months ended June 30, 2022 and 2021 and $8.3 and $8.7 for the six months ended June 30, 2022 and 2021.

These are non-GAAP financial measures used by management to enhance the understanding of our operating results. EBITDA and Adjusted EBITDA are key measures we use to evaluate our operational performance. We provide EBITDA and Adjusted EBITDA because we believe that investors and securities analysts will find EBITDA and Adjusted EBITDA to be useful measures for evaluating our operating performance and comparing our operating performance with that of similar companies that have different capital structures and for evaluating our ability to meet our future debt service, capital expenditures, and working capital requirements. However, EBITDA and Adjusted EBITDA should not be considered as alternatives to net income as a measure of operating results or as alternatives to cash flows from operating activities as a measure of liquidity in accordance with GAAP.

24  |  Shareholder Letter / Q2 2022

Q2 2022 QTD Free Cash Flow

($ in Millions)

	Q2 2022			Q2 2021
Net cash (used) provided by operating activities (GAAP measure)		(80.4	)		(78.5	)
Excluding the impact of changes in cash of assets held for sale and the use of cash for M&A activities		-			8.2
Excluding the use of cash for the settlement of foreign exchange derivative instruments		0.4			0.1
Excluding the termination of certain interest rate swaps due to debt refinancing		-			-
Excluding the use of cash for the legal settlement related to the impaired cloud-based ERP implementation fees		5.0			-
Capital expenditures		(4.1	)		(3.7	)
Capitalized software development		(9.8	)		(5.3	)
Free cash flow/(use) (non-GAAP measure)		(88.6	)		(79.2	)
Add back: cash interest		27.9			27.0
Unlevered Free Cash Flow (Use) (non-GAAP Measure)		(60.7	)		(52.2	)

Trailing 12-month Free Cash Flow

($ in Millions)

	Q2 2022			Q2 2021
Net cash (used) provided by operating activities (GAAP measure)		(39.6	)		42.2
Excluding the impact of changes in cash of assets held for sale and the use of cash for M&A activities		16.8			4.6
Excluding the use of cash for the settlement of foreign exchange derivative instruments		0.7			18.0
Excluding the termination of certain interest rate swaps due to debt refinancing		-			10.3
Excluding the use of cash for the legal settlement related to the impaired cloud-based ERP implementation fees		5.0			-
Proceeds from the surrender of company-owned life insurance policies		-			8.4
Capital expenditures		(18.8	)		(24.9	)
Capitalized software development		(37.3	)		(19.5	)
Free cash flow/(use) (non-GAAP measure)		(73.2	)		39.1
Add back: cash interest		174.6			140.1
Unlevered Free Cash Flow (Use) (non-GAAP measure)		101.4			179.2

Free cash flow is a non-GAAP financial measure defined as net cash provided by operating activities from continuing operations less capital expenditures, less cash used for capitalized software development, and excluding the impact of changes in cash of assets held for sale and the use of cash for M&A and the legal settlement for impaired cloud implementation costs, and excluding the use of cash for the settlement of foreign exchange derivative instruments. With respect to the company’s non-GAAP free cash flow outlook for 2022, it is not providing a reconciliation to the most directly comparable GAAP financial measure because it is unable to predict with reasonable certainty those items that may affect such measure calculated and presented in accordance with GAAP without unreasonable effort. This measure primarily excludes the future impact of changes in cash of assets held for sale, cash used for M&A activities and the settlement of foreign exchange derivative instruments. These reconciling items are uncertain, depend on various factors and could significantly impact, either individually or in the aggregate, net cash provided (used) by operating activities calculated and presented in accordance with GAAP.

25  |  Shareholder Letter / Q2 2022

Q2 2022 Net Debt

($ in Millions)

	30-Jun-22			31-Dec-21			30-Jun-21
Cash, cash equivalents, restricted cash and short-term investments (GAAP measure)		281.3			423.2			232.4
Cash included in assets held for sale		3.4			3.1			5.2
Debt instruments		(2,422.5	)		(2,292.7	)		(2,351.6	)
Net debt (non-GAAP measure)		(2,138.8	)		(1,866.4	)		(2,114.0	)

Trailing 12-month Return on Invested Capital (ROIC)

($ in Millions)

	2019			2020			2021			TTM Q2 2022
Revenue		4,409.0			3,902.0			3,905.0			3,699.3
GAAP Operating Profit (Loss)		(27.0	)		24.0			137.0			(86.8	)
Non-GAAP Adjustments2		295.0			331.0			196.0			328.9
Non-GAAP Operating Profit2		268.0			355.0			333.0			242.1
Effective Tax Rate of 30%		80.4			106.5			99.9			72.6
Net Operating Profit after Tax (NOPAT)2		188.0			248.0			233.0			169.5
Cash & Short-Term Investments3		(388.0	)		(364.0	)		(426.1	)		(281.0	)
Debt		2,141.0			2,346.0			2,293.0			2,423.0
Leases		172.0			154.0			164.0			152.6
Pensions & Other Post-Retirement Liabilities		265.0			222.0			104.0			92.0
Redeemable Noncontrolling Interest		21.0			19.0			-			-
Equity		(506.0	)		(832.0	)		(837.0	)		(1,247.2	)
Total Invested Capital		1,705.0			1,545.0			1,298.0			1,140.0
Average Invested Capital		1,977.0			1,625.0			1,546.0			1,420.6
Return on Invested Capital (ROIC)2		9.5	%		15.3	%		15.1	%		11.9	%

² Return on invested capital (ROIC) is a non-GAAP financial measure defined as adjusted net operating profit after tax (NOPAT) utilizing a 30% estimated effective tax rate divided by average invested capital for the period. Invested capital consists of net debt, leases, pension and other post-retirement liabilities and equity.

³ Includes cash included in assets held for sale

26  |  Shareholder Letter / Q2 2022

Software Business Line Distribution*

($ in Millions)

Q2 2022 QTD

GAAP

Historical Presentation			Adjustments						Current Presentation
Historical Segment	Amount		Professional,   Maintenance and Support Services			Software Licenses			Amount		Updated Segment
Services Sales	$	435.4		90.0					$	525.4	Services Sales
Products Sales		312.3					14.0			326.3	Products Sales
Software Sales		104.0		(90.0	)		(14.0	)		-
Total Sales	$	851.7		-			-		$	851.7	Total Sales
Services CoGS	$	328.0		47.1					$	375.1	Services CoGS
Products CoGS		307.0					8.8			315.8	Products CoGS
Software CoGS		55.9		(47.1	)		(8.8	)		-
Total COGS	$	690.9		-			-		$	690.9	Total CoGS
Services Gross Profit	$	107.4		42.9			-		$	150.3	Services Gross Profit
Product Gross Margin		24.7%								28.6%	Services Product Margin
Products Gross Profit		5.4		-			5.1			10.5	Products Gross Profit
Services Gross Margin		1.7%								3.2%	Products Product Margin
Software Gross Profit		48.1		(42.9	)		(5.1	)		-
Software Gross Margin		46.2%								0.0%
Total Gross Profit	$	160.8		-			-		$	160.8	Total Gross Profit
Total Gross Margin		18.9%								18.9%	Total Gross margin

Non-GAAP

Historical Presentation			Adjustments						Current Presentation
Historical Segment	Amount		Professional,   Maintenance and Support Services			Software Licenses			Amount		Updated Segment
Services Sales	$	434.6		90.0					$	524.6	Services Sales
Products Sales		308.2					13.2			321.4	Products Sales
Software Sales		103.2		(90.0	)		(13.2	)		-
Total Sales	$	846.0		-			-		$	846.0	Total Sales
Services CoGS	$	318.8		47.1					$	365.9	Services CoGS
Products CoGS		262.2					8.0			270.2	Products CoGS
Software CoGS		55.1		(47.1	)		(8.0	)		-
Total COGS	$	636.1		-			-		$	636.1	Total CoGS
Services Gross Profit	$	115.7		43.0			-		$	158.7	Services Gross Profit
Product Gross Margin		26.6%								30.3%	Services Product Margin
Products Gross Profit		46.1		-			5.1			51.2	Products Gross Profit
Services Gross Margin		14.9%								15.9%	Products Product Margin
Software Gross Profit		48.1		(43.0	)		(5.1	)		-
Software Gross Margin		46.6%								0.0%
Total Gross Profit	$	209.9		-			-		$	209.9	Total Gross Profit
Total Gross Margin		24.8%								24.8%	Total Gross Margin

*Current presentation is consistent with the notes historically presented within the 10-Q/10-K financials.

27  |  Shareholder Letter / Q2 2022

Q2 2022 YTD

GAAP

Historical Presentation			Adjustments						Current Presentation
Historical Segment	Amount		Professional, Maintenance and Support Services			Software Licenses			Amount		Updated Segment
Services Sales	$	873.8		177.8					$	1,051.6	Services Sales
Products Sales		603.1					26.8			629.9	Products Sales
Software Sales		204.6		(177.8	)		(26.8	)		-
Total Sales	$	1,681.5		-			-		$	1,681.5	Total Sales
Services CoGS	$	649.2		100.1					$	749.3	Services CoGS
Products CoGS		565.5					20.6			586.1	Products CoGS
Software CoGS		120.7		(100.1	)		(20.6	)		-
Total COGS	$	1,335.4		-			-		$	1,335.4	Total CoGS
Services Gross Profit	$	224.6		77.7			-		$	302.3	Services Gross Profit
Product Gross Margin		25.7%								28.7%	Services Product Margin
Products Gross Profit		37.6		-			6.2			43.8	Products Gross Profit
Services Gross Margin		6.2%								7.0%	Products Product Margin
Software Gross Profit		83.9		(77.7	)		(6.2	)		-
Software Gross Margin		41.0%								0.0%
Total Gross Profit	$	346.1		-			-		$	346.1	Total Gross Profit
Total Gross Margin		20.6%								20.6%	Total Gross Margin

Non-GAAP

Historical Presentation			Adjustments						Current Presentation
Historical Segment	Amount		Professional, Maintenance and Support Services			Software Licenses			Amount		Updated Segment
Services Sales	$	870.3		177.8					$	1,048.1	Services Sales
Products Sales		597.1					25.2			622.3	Products Sales
Software Sales		202.9		(177.8	)		(252	)		-
Total Sales	$	1,670.4		-			-		$	1,670.4	Total Sales
Services CoGS	$	639.0		97.0					$	736.0	Services CoGS
Products CoGS		518.8					19.7			538.5	Products CoGS
Software CoGS		116.7		(97.0	)		(19.7	)		-
Total COGS	$	1,274.5		-			-		$	1 274.5	Total CoGS
Services Gross Profit	$	231.4		80.7			-		$	312.1	Services Gross Profit
Product Gross Margin		26. 6%								29.8%	Services Product Margin
Products Gross Profit		78.3		-			5.5			83.8	Products Gross Profit
Services Gross Margin		13.1%								13.5%	Products Product Margin
Software Gross Profit		86.2		(80.7	)		(55	)		-
Software Gross Margin		42.5%								0.0%
Total Gross Profit	$	395.9		-			-		$	395.9	Total Gross Profit
Total Gross Margin		23.7%								23.7%	Total Gross Margin

28  |  Shareholder Letter / Q2 2022

Q2 2021 QTD

GAAP

Historical Presentation			Adjustments						Current Presentation
Historical Segment	Amount		Professional, Maintenance and Support Services			Software Licenses			Amount		Updated Segment
Services Sales	$	493.5		93.2					$	586.7	Services Sales
Products Sales		338.5					18.3			356.8	Products Sales
Software Sales		111.5		(93.2	)		(18.3	)		-
Total Sales	$	943.5		0.0			0.0		$	943.5	Total Sales
Services CoGS	$	355.6		54.3					$	409.9	Services CoGS
Products CoGS		276.1					5.6			281.7	Products CoGS
Software CoGS		59.9		(54.3	)		(56	)		-
Total COGS	$	691.6		0.0			0.0		$	691.6	Total CoGS
Services Gross Profit	$	137.9		38.9			0.0		$	176.8	Services Gross Profit
Product Gross Margin		27.9%								30.1%	Services Product Margin
Products Gross Profit		62.4		0.0			12.7			75.1	Products Gross Profit
Services Gross Margin		18.4%								21.0%	Products Product Margin
Software Gross Profit		51.6		(38.9	)		(12.7	)		-
Software Gross Margin		46.3%								0.0%
Total Gross Profit	$	251.9		0.0			0.0		$	251.9	Total Gross Profit
Total Gross Margin		26.7%								26.7%	Total Gross Margin

Non-GAAP

Historical Presentation			Adjustments						Current Presentation
Historical Segment	Amount		Professional, Maintenance and Support Services			Software Licenses			Amount		Updated Segment
Services Sales	$	493.5		93.2					$	586.7	Services Sales
Products Sales		338.5					18.3			356.8	Products Sales
Software Sales		111.5		(93.2	)		(18.3	)		-
Total Sales	$	943.5		-			-		$	943.5	Total Sales
Services CoGS	$	348.5		53.2					$	401.7	Services CoGS
Products CoGS		274.6					5.4			280.0	Products CoGS
Software CoGS		58.6		(53.2	)		(5.4	)		-
Total COGS	$	681.7		-			-		$	681.7	Total CoGS
Services Gross Profit	$	145.0		40.0			-		$	185.0	Services Gross Profit
Product Gross Margin		29.4%								31.5%	Services Product Margin
Products Gross Profit		63.9		-			12.9			76.8	Products Gross Profit
Services Gross Margin		18.9%								2 1.5%	Products Product Margin
Software Gross Profit		52.9		(40.0	)		(12.9	)		-
Software Gross Margin		47.4%								0.0%
Total Gross Profit	$	261.8		-			-		$	261.8	Total Gross Profit
Total Gross Margin		27.7%								27.7%	Total Gross Margin

29  |  Shareholder Letter / Q2 2022

Q2 2021 YTD

GAAP

Historical Presentation			Adjustments						Current Presentation
Historical Segment	Amount		Professional, Maintenance and Support Services			Software Licenses			Amount		Updated Segment
Services Sales	$	975.9		184.4					$	1,160.3	Services Sales
Products Sales		684.3					42.8			727.1	Products Sales
Software Sales		227.2		(184.4	)		(42.8	)		-
Total Sales	$	1,887.4		-			-		$	1,887.4	Total Sales
Services CoGS	$	695.7		103.8					$	799.5	Services CoGS
Products CoGS		547.3					15.5			562.8	Products CoGS
Software CoGS		119.3		(103.8	)		(15.5	)		-
Total COGS	$	1,362.3		-			-		$	1,362.3	Total CoGS
Services Gross Profit	$	280.2		80.6			-		$	360.8	Services Gross Profit
Product Gross Margin		28.7%								31.1%	Services Product Margin
Products Gross Profit		137.0		-			27.3			164.3	Products Gross Profit
Services Gross Margin		20.0%								22.6%	Products Product Margin
Software Gross Profit		107.9		(80.6	)		(27.3	)		-
Software Gross Margin		47.5%								0.0%
Total Gross Profit	$	525.1		-			-		$	525.1	Total Gross Profit
Total Gross Margin		27.8%								27.8%	Total Gross Margin

Non-GAAP

Historical Presentation			Adjustments						Current Presentation
Historical Segment	Amount		Professional, Maintenance and Support Services			Software Licenses			Amount		Updated Segment
Services Sales	$	975.9		184.4					$	1,160.3	Services Sales
Products Sales		684.3					42.8			727.1	Products Sales
Software Sales		227.2		(184.4	)		(42.8	)		-
Total Sales	$	1,887.4		-			-		$	1,887.4	Total Sales
Services CoGS	$	690.2		101.5					$	791.7	Services CoGS
Products CoGS		545.3					15.2			560.5	Products CoGS
Software CoGS		116.7		(101.5	)		(15.2	)		-
Total COGS	$	1,352.2		-			-		$	1,352.2	Total CoGS
Services Gross Profit	$	285.7		82.9			-		$	368.6	Services Gross Profit
Product Gross Margin		29.3%								31.8%	Services Product Margin
Products Gross Profit		139.0		-			27.6			166.6	Products Gross Profit
Services Gross Margin		20.3%								22.9%	Products Product Margin
Software Gross Profit		110.5		(82.9	)		(27.6	)		-
Software Gross Margin		48.6%								0.0%
Total Gross Profit	$	535.2		-			-		$	535.2	Total Gross Profit
Total Gross Margin		28.4%								28.4%	Total Gross Margin

30  |  Shareholder Letter / Q2 2022

XML

Document and Entity Information	Aug. 02, 2022
Cover [Abstract]
Entity Registrant Name	DIEBOLD NIXDORF, Inc
Amendment Flag	false
Entity Central Index Key	0000028823
Document Type	8-K
Document Period End Date	Aug. 02, 2022
Entity Incorporation State Country Code	OH
Entity File Number	1-4879
Entity Tax Identification Number	34-0183970
Entity Address, Address Line One	50 Executive Parkway
Entity Address, Address Line Two	P.O. Box 2520
Entity Address, City or Town	Hudson
Entity Address, State or Province	OH
Entity Address, Postal Zip Code	44236
City Area Code	(330)
Local Phone Number	490-4000
Written Communications	false
Soliciting Material	false
Pre Commencement Tender Offer	false
Pre Commencement Issuer Tender Offer	false
Security 12b Title	Common shares, $1.25 par value per share
Trading Symbol	DBD
Security Exchange Name	NYSE
Entity Emerging Growth Company	false