Hypercom Corp. has returned to profitability despite a drop in revenue that it said was related to exchange rates.
New customer wins, as well as continued business from clients that have stuck with Hypercom through the economic downturn, helped the Scottsdale, Ariz., terminal maker swing to a second-quarter profit.
"During these very difficult times, customers have increasingly viewed Hypercom as a trusted partner and, as a result, we continue to have very good revenue traction and we expect to announce new contracts and partnerships," Philippe Tartavull, the company's president and chief executive, said in a conference call Tuesday.
Though Hypercom's business in North America may remain flat or increase only slightly in the near term, Tartavull said the region has shown interest in mobile payments. He said that his company had "good revenue momentum" in Asia and that he expects sales in Europe and Latin America to improve later this year.
Hypercom is also nearing the announcement of some new international contracts, Tartavull said.
The company's revenue fell 14%, to $106.8 million, in the second quarter from a year earlier.
Its net income was $1.3 million, compared with a net loss of $10.9 million a year earlier. In the first quarter it had revenue of $83.6 million and a net loss of $9.9 million.
Robert Dodd, an analyst at Regions Financial Corp.'s Morgan Keegan & Co. Inc., wrote in a research note Wednesday that Hypercom had a "significant outperformance on all metrics" in all regions.
Exchange rates are still an issue, but Hypercom has done a good job of countering the problem by controlling its costs and signing new contracts, Dodd wrote.