"Don't trust, but Verifone" would be the twist Verifone might
put on the "Trust but Verify" proverb used in arms negotiations.
The company is a leading supplier of electronic payment hardware
and software for merchant-operated, consumer-facing, and
self-service payment systems. Its products include point-of-sale
(POS) software and terminals, smart card and check readers, receipt
printers, and Internet commerce software. It also provides
installation, training, and other services. Customers include
companies in the hospitality, retail, and healthcare markets, as
well as government agencies. VeriFone generates more than 70% of
sales outside the US.
The US is VeriFone's largest single market, accounting for more
than a quarter of sales. Brazil, where the electronic payment card
industry is quickly growing, contributes about 11% of sales.
Outside the US it has offices in France, India, Brazil, Israel,
Sweden, Philippines, New Zealand, Taiwan, China, Germany, Denmark,
Norway, Singapore, Australia, Mexico, Finland, South Africa, the
UK, and Latvia.
Sales and Marketing
With clients ranging from small merchants to government-sponsored
payment processors, VeriFone augments its direct sales force with a
network of distributors, resellers, and systems integrators.
VeriFone's revenue increased 10% in 2014, recharging sales growth
that stalled in 2013. Revenue reached $1.87 billion in 2014 from
$1.7 billion in 2013. Its systems solutions segment benefited from
customers refreshing their technology and governments expanding
cashless payments. Also, the timing of purchases by customers that
worked against VeriFone in 2013 worked for the company in 2014 as
deals were consummated. While VeriFone lost money in 2014, $37
million below break even, the loss was not as bad as the $296
million loss posted for 2013.
VeriFone has benefited from a general trend away from cash and
check transactions toward electronic credit and debit payments. In
addition to credit and debit card readers, the company has
developed systems that handle radio-frequency identification (RFID)
cards, mobile phone transactions, gift cards, electronic bill
payments, signature capture, and benefits transfers.
The trend toward cashless payments has drawn competition to the
market, much of it aimed at the small and medium business (SMB)
market. In 2015 VeriFone offered its Payment-as-a-Service (PaaS)
products to the SMB market in North America, where it had been
available onto the big businesses. PaaS moves the payment
management functions to cloud-based computers.
VeriFone began working with First Data to help merchants move
quickly to accept credit and debit cards enabled by computer chips,
which are more secure than previous cards. Merchants are interested
in the chip-enabled cards to due to consumer concern about fraud
and the shift of responsibility to merchants for fraud from
Mergers and Acquisitions
The company uses acquisitions to build out its product and
technology portfolio while pushing into new geographies. In 2013
VeriFone bought two New Zealand businesses -- EFTPOS New Zealand
and Sektor Payments, both of which provide payment solutions and