Times remain tough for terminal vendors. PAX Global (Bermuda-registered, Hong Kong-listed, with main operations in China) reported H1 2025 revenue of US$348 million, down 10% year-on-year and continuing a decline that began in 2022.

Management once again blamed “global economic uncertainty” for the slump.

Europe remains PAX’s strongest region, generating US$139 million (–2%). Italy, the UK, and France performed well, with good demand for the A920Pro and A35 terminals, while the IM30 unattended unit is reportedly doing well with EV charging providers.

North America delivered the best positive performance, possibly buoyed by distributors front-loading orders ahead of looming import tariffs, but sales were down in Latin America and APAC.

Services revenue rose 8% to US$22 million, driven by SaaS fees from MAXSTORE, which now connects 15 million terminals to a marketplace of up to 16,000 applications. The idea is that banks and PSP’s white-label the MAXSTORE and encourage their merchants to download apps. Yet with services revenues amounting to less than US$3 per terminal per year, these recurring fees are welcome but far from transformational.

Hardware sales fell 4% although management is keen to highlight that 65% of terminal revenue came from the newer Android-based machines.

Overall, gross profit declined 10% to US$163 million, and operating profit slipped 12% to US$60 million. Weaker top-line growth is squeezing margins despite good cost control.

Encouragingly PAX isn’t cutting corners on R&D, which held steady at US$39 million, and headcount remained flat at around 1,500 employees. Management highlighted two key certifications: the A920Pro achieved EMVCo C-8, and the A77 Mini became the world’s first terminal certified under PCI v7.0.

Despite continued tough market conditions, PAX remains financially strong and will pay a dividend yielding around 8.3% at current share price.

The story remains familiar: terminal sales in their third year of decline, services inching forward, and Android dominance intact. PAX remains profitable, cash generative and dividend-friendly, but its core challenge stays the same – how to turn a shrinking hardware business into sustainable, services-led growth.

Times are tough for payment terminal vendors. PAX Technologies, a market leader with a fine set of products, reported sales falling 15% in H1 2024 to US$386m, the lowest level since 2020. 

PAX, registered in Bermuda, listed on the Hong Kong stock exchange and with its main operations in China, blamed “global economic uncertainty” for its steadily declining topline. Although profitable and generating plenty of cash, PAX’s share price is bombed out. The market capitalisation is just $625m and the stock yields 10% at a PE of 5. 

On the positive side, over 50% of sales are now Android “smart terminals.” This is a segment in which PAX, with a range of elegant keenly priced devices such as the A920, had early market leadership. Android offers terminal vendors the opportunity to upsell value added services – such as app stores – to bank and PSP customers. Critically, service revenue is recurring and can be secured under long-term contract.

PAX’s turnover from services, including maintenance and installation, is growing quickly from a low base, up 33% to $21m. Of this, $8m was software as a service revenue linked to the Maxstore product which brings together terminal management, reporting and a white-label app store. The apps themselves are supplied by 3^rd parties and include booking, loyalty, labour scheduling and many more. Here’s a full list. 

Maxstore generates big numbers. The service connects 12m terminals, 2m merchants, thousands of app developers and manages 215m push tasks annually. 

Yet total service revenue of $21m in the last six months equates to less than $4 per installed terminal each year. There is a long way to go for Maxstore to make up for the long-term decline in device sales which fell 17% in H1 to $365m.

Competitors – notably Castles, Newland and Ingenico – are releasing new Android devices themselves and PAX will need to innovate to retain its leadership. PAX has launched a number of new models including the A8900 and A99 portables and the IM25 for unattended. The company is, very sensibly, extending into ECR hardware with new Elys series. 

The devices are put together at the new PAX Smart Terminals Industrial Park at Huizhou, China, built at cost of $91m and featuring production lines, R&D and “well equipped dormitories” with a total floor area of 261.000 square metres.

Although PAX sells its product worldwide, most revenue comes from Europe and Latin America. In H1, the business was hit by a notably poor performance in LATAM where sales fell 21% to $137m. Brazil was particularly weak which management blames on the economy as well as slowing demand as the terminal market has matured. EMEA was more resilient, revenue was down just 4% to $137m with the region now accounting for 37% of global sales. 

The best European markets were Italy, UK and Hungary with “fluctuating demand” reported in Germany and Spain. The A920PRO is reportedly selling well. PAX believes it has a major opportunity with the growing deployment of EV charging points following the EU’s AFIR directive.

In the US, PAX has seen a sharp slowdown in demand from ISOs and banks. Like many other payment businesses, it is reorientating sales to ISVs.

In APAC, PAX is buying its Australian distributor for up to $20m, depending on performance.

Cost of sales fell 19% to $205m resulting in a 10% decline in gross profit to $180m. Gross margin rose 2ppt to 47%, mainly due to the depreciation in the Renminbi reflecting PAX’s cost base in mainland China. 

Management has taken a firm line with controllable costs. Employee expense was cut 18% to $50m. Staff numbers have been cut by 10% to 1596 staff, earning on average 9% less at an average of $31.4K.

R&D spend was steady at $39m.

Operating profit fell 21% to $69m. The operating margin fell just 1ppt to 18%, an impressive performance by most standards. But investors won’t be questioning how PAX makes money today. The worry is how it will continue to generate cash if terminal sales keep falling.