Diebold Nixdorf reported strong financial results for the second quarter of 2026, showcasing notable increases in various key performance indicators. The company achieved a non-GAAP revenue of $927.6 million, reflecting a 1.4% year-over-year growth and a 4% sequential increase. This performance was largely driven by a substantial 24% year-over-year growth in the retail sector. Despite facing some delays in banking sector projects, the company's first-half order entry reached its highest level in four years, contributing to a robust product backlog of $814 million. This positive momentum led management to reaffirm their full-year financial outlook, highlighting ongoing commercial success and operational efficiency.
During the second quarter, Diebold Nixdorf's non-GAAP revenue reached $928 million, driven by strong commercial demand and operational effectiveness. Order entry saw a 3% year-over-year increase and a 6% sequential rise, setting a four-year high for first-half order entries. Adjusted EBITDA grew to $121 million, an 8% increase year-over-year and a 22% sequential rise, while adjusted earnings per share climbed 17% year-over-year to $1.10. The banking segment continued its branch automation strategy, expanding beyond traditional ATMs to include teller cash recyclers, transaction middleware, and managed services. The retail division reported robust growth across all regions, fueled by innovation in store technology, AI-powered solutions, and managed services. The company also improved its service level performance to record highs, indicating enhanced customer satisfaction and operational efficiency.
Despite these achievements, Diebold Nixdorf encountered certain obstacles. Elevated memory costs in its electronic point-of-sale portfolio presented a headwind, although the company implemented pricing adjustments and diversified its sourcing to mitigate these effects. To ensure component availability and support deployment schedules, the company strategically increased its inventory, which temporarily affected quarterly free cash flow. This inventory investment is expected to normalize by the fourth quarter. The company also benefited from a one-time tariff refund of approximately $13 million, which helped offset the impact of higher memory costs. These factors underscore the company's proactive approach to market challenges while maintaining its growth trajectory.
Looking ahead, Diebold Nixdorf reaffirmed its full-year 2026 revenue guidance between $3.86 billion and $3.94 billion, supported by recurring service revenue and a substantial product backlog. The company anticipates full-year adjusted EBITDA to be in the range of $510 million to $535 million. Free cash flow guidance remains between $255 million and $270 million, excluding approximately $50 million in discrete tax payments related to prior fiscal years. The company's commitment to lean operating principles has yielded significant productivity gains, process improvements, and quality enhancements across its manufacturing facilities and service operations. These initiatives are expected to continue driving efficient growth and sustainable long-term value for shareholders. Share repurchases also continued, with $60 million used to repurchase 752,000 shares, reflecting the company's commitment to returning value to shareholders.
The company's performance in the second quarter of 2026 demonstrated sustained commercial momentum across all business segments. Record-setting order entries in the first half of the year, coupled with a growing backlog, underscore a healthy demand environment. The retail sector showed exceptional growth, while strategic initiatives in banking began to yield positive results. Despite challenges posed by memory costs and project timing, Diebold Nixdorf effectively managed its operations and maintained its financial projections for the full year. The continued focus on operational discipline, inventory optimization, and service productivity is expected to drive further improvements and long-term value creation for stakeholders.