Image source: NCR.

It's been a long time since you could find traditional cash registers at most stores, but the history of NCR (NYSE:NCR) hasn't stopped it from keeping up with the times. The company once known as National Cash Register has become a key player in technology that enables transactions of all kinds, going up against rivals like PayPal (NASDAQ:PYPL) and Square (NYSE:SQ) in the mobile-payment arena. Coming into its fourth-quarter financial report, NCR had seen its stock struggle lately, and investors were braced for lower sales and flat earnings performance. Even though NCR posted solid numbers to finish 2015, its guidance for the coming year was less upbeat. Let's look more closely at the latest from NCR and what to expect in 2016 from the payment technology company.

NCR rings up its profits
NCR's fourth-quarter results were generally in line with what the company had expected to see. Revenue fell 5% to $1.68 billion, falling just short of the $1.70 billion consensus estimate among investors. On the bottom line, income from operations nearly quadrupled to $138 million, and NCR posted adjusted earnings of $0.92 per share, $0.05 greater than what most investors had expected.

Looking more closely at NCR's segment numbers, you can see dramatic differences in performance across different divisions. The hospitality arena saw revenue jump 10%, producing a 38% rise in operating income. On the other hand, the financial services business suffered a sales decline of 11%, and operating income fell 3%. Retail solutions and emerging industries were mixed, with flat revenue but growing profits from retail offsetting weakening bottom-line results from emerging industries.

The strong dollar also had an impact on NCR's numbers. Revenue would have been flat in constant-currency terms, pointing to 5 percentage points of dollar-related headwinds. The impact was even clearer on earnings, with a 9-percentage-point drop to total operating income.

CEO Bill Nuti summarized the opportunities and challenges that NCR had during the quarter. "In Retail Solutions ... we capitalized on an improving industry environment," Nuti said, "and in Hospitality ... we generated strong fourth-quarter and full-year software and cloud growth." The CEO noted that "Financial Services faced more difficult currency and geographic headwinds this year," but Nuti was especially happy with free cash flow growth and high-value software offerings.

What's next for NCR?
NCR has high hopes for 2016. Nuti believes that the company can take advantage of its leadership position in the industry over newer entrants like PayPal and Square and "take advantage of the expected widespread increase in connected devices and continued shift in consumer transaction preferences."

What that means in terms of guidance, though, isn't as favorable as investors had hoped to see. NCR said that it expects first-quarter revenue of $1.44 billion to $1.45 billion, with adjusted earnings of $0.30 to $0.35 per share. Both of those figures are well short of expectations, especially compared to the current consensus forecast for $0.52 per share in earnings.

Similarly, full-year 2016 projections fell below even modest growth projections among investors. NCR guided investors toward revenue of $6.1 billion to $6.2 billion, and adjusted earnings of $2.72 to $2.82 per share. Those figures reflect the expected sale of NCR's interactive printer solutions business, but it still points to results that could be lower than 2015's year-end totals.

NCR shares didn't react immediately to the news, leaving prices unchanged in after-hours trading following the announcement. Given that PayPal and Square have also seen share-price challenges recently, NCR will need to produce better growth prospects than it's currently projecting in order to convince shareholders that it can keep up with its rivals and take full advantage of the rapid growth in the industry.