Hypercom Corp. is offering merchants the option of not offering customers paper receipts.
The Scottsdale, Ariz., company announced Wednesday that it would incorporate software from TransactionTree Inc. into its popular Optimum L4150 point of sale terminal, enabling retailers to deliver receipts by e-mail.
The TransactionTree application enables merchants to collect customers' e-mail addresses, and prompts checkout clerks to ask if consumers prefer a paper receipt or to receive one electronically.
Hypercom said the L4150 "is our most popular terminal for multilane retailers." It has been available since 2007, and a software upgrade will deliver the TransactionTree service to devices already in place.
TransactionTree, of Atlanta, said there is no legal difference between a printed receipt and a digital version. Consumers can also view their receipts through an account set up with TransactionTree that collects and organizes their purchase records.
"The transaction will still be valid and will allow the consumer a much easier way to track their expenses in a centralized location rather than looking for a receipt that fades quickly," said Vanessa Jimenez, TransactionTree's chief creative officer.
As for whether merchants will use the service, Jimenez cited a study by the trade publication Retail Info Systems News that found that 12% of retailers already provide digital receipts and another 18% plan to do so this year.
Gil Luria, a vice president of research at Wedbush Securities, a Los Angeles investment research firm, said merchants will likely be intrigued by the idea, but could not say if it would catch on.
"It's very hard to predict how successful a product like that is going to be when it's first introduced into a market," he said. "It appears to be totally compelling."
But he noted that such technology advances still rely on consumer adoption. "Sometimes, cool technology doesn't get received well by consumers," he said.
Luria said this type of innovation is to be expected from payment-terminal makers in saturated markets. "Innovations in payment terminals are what drives upgrades in equipment," he said.
George Sutton, an analyst with Craig-Hallum Capital Group LLC in Minneapolis, said the e-mail-enabled Hypercom terminal is emblematic of what to expect from terminal makers in 2010.
"This is another innovation that represents what we're starting to see from terminal vendors this year, which is trying to move forward with some fairly significant changes in the way terminals play in the overall [payment] system," Sutton said.
Hypercom also said Wednesday that it has renewed through 2012 its contract with Philippe Tartavull, the company's president and chief executive.
Tartavull joined Hypercom in February 2007 as president and in December of that year added CEO to his title.
Neither Sutton nor Luria were surprised that Tartavull's contract was renewed.
"Much of the investment enthusiasm in regards to the stock has been driven by our comfort with his strategy," Sutton said. "We will see a lot of those strategies unveiled this year in terms of how Hypercom manufactures products."
Hypercom said in November that it is pursuing a "joint development manufacturer" strategy. Under this model, Hypercom will design devices and a hardware manufacturer will choose the actual components used in them.
"They're going to look like a marketing and design group that marries up with a builder," Sutton said, a model that is similar to Apple Inc.
Tartavull's influence has also driven Hypercom's financial results, Luria said.
"Hypercom has had a very hard time through several attempted turnarounds over the last several years," Luria said. Financial results from 2009 show that "maybe this company has been able to turn it around and made some progress to being consistently profitable."
Hypercom had profits of $1.3 million in the second quarter of 2009 and $1.2 million in the third quarter of last year, the first profitable consecutive quarters since the third quarter of 2006, Hypercom said.
"Let's not forget they had two profitable quarters in the midst of the greatest recession in 70 years," Luria said.
He also credited Tartavull with the successful integration of the e-Transactions business Hypercom bought from Thales SA of France in 2008.