NCR Second-Quarter Earnings Better Than Expected; Driven by Strong Performance in Teradata Data Warehousing and Improvement in Customer Services

Business Wire, July 12, 2005

DAYTON, Ohio -- NCR Corporation (NYSE:NCR) today announced that it anticipates its second-quarter earnings to exceed its prior guidance. NCR now expects second-quarter earnings of $0.64 or more per share, including certain non-operational items that benefited NCR's results. Excluding the benefit of such items discussed below, earnings per share is expected to be $0.34(1) or more, which compares to NCR's previous guidance of $0.25 to $0.30 per share,(1) also excluding the benefit of such items. The $0.34(1) of earnings per share compares to $0.19(1) in the second quarter of 2004, which also excluded the benefit of certain non-operational items, and the $0.30 mean earnings per share estimate among Wall Street analysts for NCR's 2005 second quarter results, according to First Call.

Non-operational items in NCR's GAAP results for the quarter include $0.34 of benefit from the favorable settlement of prior-year tax audits, a $0.04 net benefit from other non-operational items, as well as $0.08 of incremental pension expense associated with a previously announced early-retirement program.

NCR expects to report second-quarter revenue of approximately $1.47 billion, an increase of 1 percent from the second quarter of 2004. The year-over-year revenue increase was benefited by 2 percentage points from foreign currency fluctuations.

Stronger-than-anticipated profitability in the company's Teradata Data Warehousing and Customer Services businesses more than offset lower-than-expected revenue and profitability in Financial Self Service, which was largely due to the adverse timing of transactions in international markets and the impact of currency fluctuations.

NCR is increasing its earnings expectation for 2005. Including the net favorable impact of non-operational items in the first and second quarters of 2005, full-year earnings per share is expected to be in the $1.68 to $1.73 range.

Excluding the net benefit of these items, full-year earnings per share is expected to be $1.40 to $1.45. Earnings per share in the third quarter is expected to be in the $0.28 to $0.33 range.

Reconciliation of GAAP to Non-GAAP Measures(1)
Non-GAAP measures exclude the effect of the items listed below

                                Results               Guidance
                           ------------------ ------------------------
                            Q2 2005  Q2 2004    Q3 2005     FY 2005
                            -------  -------    -------     -------
Earnings Per Share (GAAP)     $0.64    $0.64  $0.28-$0.33 $1.68-$1.73
  Benefit from the
   resolution of prior-year
   tax audits                  0.34     0.44            -        0.34
  Early retirement-related
   pension expense            (0.08)       -            -       (0.08)
  Net benefit from other
   non-operational items       0.04        -            -        0.04
  Receipt of acquisition-
   related break-up fee           -     0.01            -           -
  Net effect of non-
   operational items in Q1
   2005(2)                        -        -            -       (0.02)
                           ------------------ ------------------------

   Adjusted Earnings Per
    Share (Non-GAAP)          $0.34    $0.19  $0.28-$0.33 $1.40-$1.45

    (1) While NCR reports its results in accordance with Generally
        Accepted Accounting Principles in the United States, or GAAP,
        the company believes that the exclusion of certain
        non-operating items is useful for investors because it
        provides a more complete understanding of NCR's underlying
        operational performance, as well as consistency and
        comparability with past reports of financial results. In
        addition, management uses its earnings per share excluding
        these items to manage and determine the effectiveness of its
        business managers and as a basis for incentive compensation.
        This non-GAAP measure should not be considered as a substitute
        for or superior to earnings per share determined in accordance
        with GAAP.

    (2) Items include a $0.05 per share charge to decrease the value
        of an equity investment which was partially offset by a $0.03
        per share benefit from the reduction of accruals made in
        previous periods for purchased goods and services.

NCR will provide more detailed information regarding its second-quarter results when it reports earnings on July 26, 2005. The company will discuss its second-quarter results and its increased guidance during a conference call scheduled for 10:00 a.m. (ET) that day. Live access to the conference call, as well as a replay of the conference call, will be available on NCR's Web site at http://investor.ncr.com/.>

About NCR Corporation

NCR Corporation (NYSE: NCR) is a leading global technology company helping businesses build stronger relationships with their customers. NCR's ATMs, retail systems, Teradata(R) data warehouses and IT services provide Relationship Technology solutions that maximize the value of customer interactions and help organizations create a stronger competitive position. NCR (www.ncr.com) is based in Dayton, Ohio.