Verifone

Verifone, Inc.

File:Verifone logo.svg Logo since 2014
Company type	Public (formerly), Private (after 2018 acquisition)
Industry	Electronic payment processing, technology solutions
Founded	1981 in Hawaii, United States
Founder	William "Bill" Melton
Headquarters	New York City , United States
Area served	Worldwide (over 150 countries)
Products	POS electronic payment hardware and software, payment systems, self-service terminals
Number of employees	~5,000 (2014)
Parent	Francisco Partners (since 2018)
Website	www.verifone.com

Verifone, Inc. is a global American enterprise based in New York City, focusing on technology solutions for electronic payment processing and value-added services at retail points of sale. The company provides payment systems operated by merchants, consumer interfaces, and self-service terminals across sectors such as finance, retail, hospitality, petroleum, government, and healthcare.

Its portfolio features POS electronic payment hardware equipped with proprietary operating systems, robust security measures, encryption technologies, and certified payment software tailored for both staffed and unattended environments. These devices accommodate a variety of payment methods including signature and PIN-secured debit and credit cards, contactless and RFID-enabled cards, smart cards, prepaid gift cards, electronic bill payments, check authorization and conversion services, signature capture functionality, and Electronic Benefit Transfer (EBT).

Verifone’s platform facilitates numerous applications—covering third-party offerings like gift and loyalty card programs, verification of healthcare insurance eligibility, and workforce time and attendance management—enabling these services to run on a unified system without the need for re-certification when new applications are integrated.

In 2018, Francisco Partners acquired Verifone for $3.4 billion, enhancing the company’s competitive positioning and expanding its worldwide footprint within the payments sector.

Overview

By October 31, 2013, Verifone had secured trademark registrations for the ‘VERIFONE’ name in 22 countries and its distinctive ribbon logo in 32 jurisdictions, including full coverage throughout the European Union. On November 3, 2014, the company unveiled a refreshed corporate logo and brand identity to symbolize its progression within the digital commerce arena where electronic payments intersect with mobile technology. Originating as the pioneer manufacturer of payment devices, Verifone has since broadened its offerings to encompass merchant-operated, consumer-facing, and self-service POS payment solutions that deliver advanced payment technology expertise at the point of sale.

Established in Hawaii in 1981, by 2014 Verifone operated globally with close to 5,000 employees serving over 150 countries. The company’s expansion has been propelled by innovation initiatives, strategic alliances, and acquisitions. Its primary areas of concentration include mobile commerce capabilities, security enhancements, service offerings, and growth in emerging markets. Strategic partnerships and acquisitions have played a significant role in boosting Verifone’s market presence and competitive edge within the payments industry.

The company’s headquarters are located in New York City with operational offices in more than 45 countries supporting its global activities.

History

Founded by William "Bill" Melton in 1981 in Hawaii, Verifone derived its name from its inaugural product—the Verification telephone.

From the late 1980s onward, Verifone dominated over 60% of the U.S. market share and secured more than half of the international POS system market during the 1990s. By 1996, sales had reached five million units. POS system sales have consistently been Verifone's main revenue source, with $387 million reported in 1995 and forecasts surpassing $500 million in subsequent years.

The Internet surge during the mid-1990s generated demand for secure online financial transactions. In response, Verifone developed software aligned with Secure Electronic Transaction (SET) protocols established by Visa Inc. and MasterCard. The company bolstered its software capabilities through a $28 million acquisition of Enterprise Integration Technologies in 1995—creators of Secure HyperText Transfer Protocol (S-HTTP)—and a $4 million equity investment in CyberCash, Inc., led by founder Melton. Collaborations with Netscape, Oracle, and Microsoft in 1996 allowed Verifone to introduce secure online transaction solutions for consumers, merchants, and financial institutions alike. Internet commerce was anticipated to expand from $10 million in 1995 to billions by the year 2000. Additionally, Verifone launched the Personal ATM (P-ATM), a smart card reader designed for home computers that enabled online purchases and card "recharging," partnering with Key Tronic to integrate P-ATM interfaces into computer keyboards.

1980s: Emergence and swift expansion

During the early 1980s, Visa and MasterCard encouraged merchants to implement automated transaction technologies for purchases exceeding $50, which significantly propelled the point-of-sale (POS) authorization sector. In 1982, Verifone introduced its inaugural POS device priced at $500 by outsourcing manufacturing to minimize expenses. Partnering with Visa, the company rapidly increased its market presence. The ZON credit card authorization system was launched in 1984 at a cost of $125, benefiting from improvements in processor speed and reduced hardware costs. By 1985, Verifone shifted its headquarters to Redwood City, achieving revenues of $15.3 million alongside a net income of $864,000.

By 1986, the company’s revenue had doubled to approximately $30 million. In January 1988, Verifone commanded over 53% of the POS market share, reporting revenues of $73.4 million and net profits exceeding $6 million. The acquisition of Icot Corp.'s transaction automation division in 1989—then holding a 20.5% market share—further solidified Verifone’s market leadership and increased revenues to $125 million. The firm also expanded internationally, entering Australia in 1988 and Finland in 1989, where it installed its millionth ZON system.

1990s: Diversification and global growth

In March 1990, Verifone became a publicly traded company, raising more than $54 million. As the credit card industry evolved, Verifone broadened its product applications to sectors including restaurants, cinemas, taxis, as well as developing software solutions for healthcare, insurance, and government entities. Global acceptance of credit cards fueled international sales growth. The company established operations in Bangalore, Singapore, the United Kingdom, Dallas, and Ft. Lauderdale to complement existing facilities in Hawaii and California. Its Gemstone transaction systems were introduced with enhanced inventory management and pricing capabilities, aligning with Visa and MasterCard’s 1994 mandate that all transactions undergo authorization.

From $155 million in 1990, revenues climbed to $226 million by 1992. By 1993, Verifone was active in over 70 countries with more than three million systems deployed globally, experiencing notable expansion in Latin America. International sales surged from less than 10% prior to 1990 to over 30% of total revenue nearing $259 million.

With the rise of debit cards in the mid-1990s, Verifone developed PIN-enabled terminals. As domestic markets approached saturation, the company shifted emphasis toward software solutions and vertically integrated systems compatible with common operating systems. To enhance production capacity, a new manufacturing facility was opened near Shanghai in 1994.

Verifone entered the smart card arena through a joint venture named SmartCash alongside Gemplus International and MasterCard. That same year, a research and development center was inaugurated in Paris to foster European innovation efforts. The company rolled out its smart card technology in 1995 followed by the Personal ATM (P-ATM) smart card reader in 1996. Major clients included American Express, MasterCard, and Wells Fargo with anticipated orders exceeding 100,000 units each and a potential market encompassing over 100 million households. These smart card readers were designed as successors to conventional credit and debit card authorization devices.

In May 1995, Verifone ventured into online payment processing by collaborating with BroadVision Inc., integrating its Virtual Terminal software into web-based platforms. Later that year in August, it acquired Enterprise Integration Technologies for $28 million to secure rights related to the S-HTTP protocol for secure internet transactions and invested $4 million in CyberCash Inc., enhancing its Internet payment capabilities.

By 1996, Verifone launched its Payment Transaction Application Layer (PTAL) suite including Virtual Terminal for merchants; Internet Gateway (vGATE) facilitating merchant-to-bank communications; and Pay Window for consumer online payments. Partnerships with Netscape, Oracle, and Microsoft enabled integration of Verifone’s software into popular browsers; Microsoft incorporated Verifone’s virtual point of sale (vPOS) technology into its Merchant System within that year. The P-ATM device merged smart card functionality with Internet transaction processing as an external computer peripheral.

In April 1997, Hewlett-Packard acquired Verifone through a stock swap valued at $1.18 billion. Four years later in May 2001, Gores Technology Group purchased the company. A recapitalization by GTCR Golder Rauner occurred in 2002 before Verifone returned to public trading on the New York Stock Exchange (NYSE: PAY) via an initial public offering in 2005.

2000s: Strategic Acquisitions

In October 2004, Lipman Electronics, an Israeli company, expanded its portfolio by acquiring the UK-based Dione plc, thereby enhancing its "NURIT" brand lineup. Subsequently, on November 1, 2006, Verifone finalized the purchase of Lipman, incorporating both Dione and NURIT product lines into its offerings for an undisclosed amount.

In September 2006, Verifone further broadened its capabilities by acquiring segments of Trintech Group plc, an Irish payment services provider, through a cash deal valued at $12.1 million (€9.4 million).

Originally known as VeriFone Holdings, Inc., the company underwent rebranding phases: adopting the name VeriFone Systems, Inc. in 2010 and simplifying to Verifone in 2014. Based in San Jose, California, Verifone maintained a network of marketing and sales offices worldwide. During this timeframe, revenue from international markets grew more rapidly than domestic sales; the North American market share declined from 57.4% of total revenues in 2006 to 39% ($359.14 million) by 2008, while revenues outside North America increased to 61% ($564.46 million).

In April 2018, private equity firm Francisco Partners acquired Verifone for $3.4 billion.

Products

Verifone, Inc. is a leading global developer and manufacturer of electronic payment hardware and software solutions. The business operates through two primary divisions: Systems Solutions, responsible for selling electronic payment devices facilitating transactions, and Services, which provides warranty coverage and technical support. For fiscal year 2008, Systems Solutions generated 87.5% of total revenue ($807.46 million), with Services contributing the remaining 12.5% ($114.46 million).

Their core offerings encompass point-of-sale terminals designed for merchants and consumers alike, as well as self-service payment platforms. Verifone’s countertop terminals support a variety of payment methods including card payments, mobile wallets, chip-and-PIN technology, contactless payments such as NFC, credit and debit cards, EBT transactions, EMV standards compliance, and other PIN-secured transactions. These devices integrate specialized software applications and provide connectivity options including 3G, GPRS, Bluetooth, and WiFi.

Additionally, the company supplies multimedia-enabled consumer-facing POS terminals; unattended self-service payment kiosks; integrated systems that combine payment processing with fuel dispensing and cash register management; mobile payment solutions tailored for diverse POS settings; contactless peripherals; network interface devices; security systems; payment-as-a-service platforms; terminal management tools; and server-based payment processing software along with middleware. Their service portfolio also covers equipment repair and maintenance, gateway transaction processing, remote terminal administration, software support services, bespoke application development, helpdesk assistance, warehousing logistics, encryption technologies, and tokenization solutions.

Countertop Terminals and PIN Pads

Verifone’s countertop devices accommodate multiple payment technologies such as Near field communication (NFC), mobile wallet transactions, chip-and-PIN authentication, QR code scanning, and contactless payments. The VX Evolution series supports applications including prepaid cards, gift card programs, and loyalty program management by integrating VeriFone’s proprietary NFC software to handle various mobile wallet platforms and loyalty schemes. Other VX models feature hybrid card readers compatible with both magnetic stripe and chip cards alongside diverse connectivity options like battery power and color display interfaces. VeriFone also offers PIN pads that support credit/debit cards, EBT benefits processing, EMV compliance with connectivity options such as 3G and NFC. These devices are designed to seamlessly interface with electronic cash registers (ECRs) and POS systems through certified software integrations.

Historically significant products in VeriFone’s lineup include successful terminals like the ZON Jr (1984), Tranz 330, Omni 460 (1991), and Omni 3200 (1999). Present-day flagship models consist of the Omni 3700 Family—specifically the Omni 3750 and Omni 3740—and the Vx Solutions series introduced in 2004. The Vx Solutions range includes countertop terminals such as Vx510, Vx520, and Vx570 offering dial-up or Ethernet connectivity alongside portable units like Vx610 and Vx670 equipped with batteries and integrated wireless modules (GPRS, CDMA, WiFi). The Vx670 additionally supports Bluetooth connectivity enabling secure "pay at table" functionality that allows customers to retain their credit cards during transactions. The Vx510 has been rebranded as Omni 3730 to capitalize on the Omni 3700 series’ market recognition; meanwhile, the Omni 3750LE model provides a cost-effective option with fewer features. The VX Evolution line continues to incorporate VeriFone’s NFC technology to sustain competitive positioning in managing mobile wallet applications.

Multimedia Customer-Facing Devices

Verifone’s multimedia point-of-sale (POS) products, marketed under the "MX solutions" brand, are designed for multi-lane retail merchants to facilitate direct interaction with customers via tailored multimedia presentations, in-store advertising, digital promotions, and enhanced service offerings. These devices come equipped with color graphic screens, compatibility with electronic cash registers (ECR), keypads, signature capture functionality, and a modular hardware design that supports integration of contactless or NFC technology. The "MX solutions" lineup also caters to self-service sectors such as taxis, parking lots, ticket dispensers, vending machines, fuel pumps, self-checkout stations, and fast food establishments.

In 2005, Verifone introduced the MX 870, its inaugural full-color EFT-POS terminal featuring full-screen video playback and enabling customers to develop their own applications. This launch initiated the MX 800 series of Visual Payment Terminals—including models MX 850, MX 860, and MX 880—which operate on Embedded Linux with the FST FancyPants framework and utilize the Opera browser for their graphical user interface.

By 2009, Verifone collaborated with Hypercom and Ingenico to establish the Secure POS Vendor Alliance aimed at raising security standards within the payment industry.

The VX Evolution series was unveiled in 2010 to comply with PCI PED 2.0 requirements and natively incorporate VeriShield Total Protect encryption and tokenization technologies. This product range expanded Verifone’s countertop terminals and PIN pads by introducing features such as full-color displays, ARM 11 processors, and fully programmable PIN pads.

Competition

Verifone is recognized as one of the leading three providers worldwide in electronic payment systems and related services. The company operates within a highly competitive environment marked by pricing pressures that have contributed to shrinking profit margins and erosion of market share. For example, First Data Corporation—once a customer—developed proprietary electronic payment solutions tailored for the U.S. market, intensifying competition. Verifone also faces rivalry from cash register manufacturers integrating payment functions, software vendors supporting online transactions, as well as smaller companies with strong regional footholds. Notable competitors include:

• PAX Technology
• Ingenico
• NCR Corporation

In 2011, Verifone broadened its market footprint by acquiring competitor Hypercom through an all-stock transaction.

Acquisitions

November 2006 Lipman Electronics (NURIT brand) Israel $793M Payment terminal manufacturing September 2006 Trintech Ireland $12.1M Linux-based unattended POS terminals October 2004 Dione plc. United Kingdom n.a. Payment terminal supplier November 1995 Enterprise Integration Technologies USA $28M Internet commerce software and consulting August 1995 CyberCash Inc. USA $4M (stock) Internet payment service provider January 1989 LCOT Corp. USA n.a. Transaction automation technology vendor %}

Divestitures

• In 2014, Manhattan Associates acquired Global Bay.

Corporate Structure

The organization is overseen by a board of directors largely made up of independent individuals, a common practice among publicly listed companies. As of June 2014, the board members were Robert W. Alspaugh (Director), Karen Austin (Director), Paul Galant (Director; Chief Executive Officer), Alex W. (Pete) Hart (Chairman), Robert B. Henske (Director), Wenda Harris Millard (Director), Eitan Raff (Director), Jonathan I. Schwart (Director), and Jane J. Thompson (Director).

According to the Corporate Governance Guidelines, the board independently appoints its Chairman and CEO based on what best benefits the company. Since 2008, these positions have been held separately to enable the CEO to concentrate on strategic business leadership while the board supervises management oversight, enterprise risk, and governance matters. The board and its committees convene regularly, generally on a quarterly basis, with meeting agendas jointly prepared by management and directors. These sessions focus on strategic planning, operational performance, financial matters, risk oversight, governance policies, and regulatory compliance.

Board’s Responsibility for Risk Management

Risk oversight is conducted directly by the Board and through its committees. The Audit Committee bears primary responsibility for managing enterprise risks, reviewing assessments of financial risks, operational risk frameworks, significant exposures, legal compliance issues, and management’s mitigation strategies. The Vice President of Internal Audit provides quarterly reports on internal audit findings and controls related to financial reporting, while the Chief Information Officer delivers updates regarding information security measures.

During the fiscal year, the Audit Committee meets at least twice each quarter, inviting management to present on critical topics such as management reporting effectiveness, cybersecurity, treasury functions, insurance programs, tax strategies, disaster recovery plans, and overall operational risk management.

The Compensation Committee monitors risks associated with executive pay and talent acquisition. It engages independent consultants to develop compensation structures that balance fixed salaries with both short-term bonuses and long-term incentives linked to financial outcomes and shareholder value. Executive bonuses are primarily tied to company performance and complemented by equity awards designed to align executives’ interests with those of shareholders.

The Corporate Governance and Nominating Committee addresses risks related to corporate governance practices. Its responsibilities include formulating governance policies, ensuring adherence to securities laws and insider trading regulations, evaluating director independence, and conducting formal assessments of both the Board’s and management’s effectiveness.

Implementation of Majority Voting Policy

During fiscal year 2013, the company revised its Bylaws and Corporate Governance Guidelines to introduce a majority voting standard effective immediately following the 2013 Annual Meeting of Stockholders. This rule mandates that in uncontested director elections—where the number of nominees equals available seats—each candidate must secure more "for" votes than "against" votes to be elected. In contested elections—defined as situations where nominees exceed board seats as determined ten days before the initial meeting notice—directors are chosen by a plurality vote.

Under these amended guidelines, any nominee in an uncontested election who receives a greater number of "against" votes than "for" votes is required to promptly submit a resignation following vote certification. The Corporate Governance and Nominating Committee reviews these resignations and advises the Board on appropriate actions after considering factors such as shareholder feedback, director qualifications, tenure duration, and contributions made. Directors subject to this review do not participate in the decision-making process. The Board must act within 90 days after certification or extend this period if necessary to comply with NYSE or SEC requirements.

External links

Date	Company Acquired	Headquarters	Purchase Price	Area of Expertise
September 2020	2checkout	USA
November 2018	Dimebox	Netherlands
February 2016	AJB Software Design	Canada	$75M	Electronic payment technologies
November 2015	InterCard AG	Germany		Payment services acquisition
December 2012	EFTPOS New Zealand Limited	New Zealand	$70M	Payment terminals and online gateways
December 2012	Sektor Group	United Arab Emirates	$8.2M	EFT-POS hardware systems
March 2012	Lift Retail Marketing	USA	n.a.	Digital retail marketing platforms
November 2011	Point International AB	Sweden	$818M	Provider of electronic payment solutions
November 2011	Global Bay Inc.	USA	$28M (stock)	Mobile retail software enhancing retailer-consumer engagement
May 2011	Destiny Electronic Commerce Pvt. Ltd.	South Africa	$37M	Electronic payments solutions
January 2011	Gemalto NV (point of sale division)	France	$14M	Point-of-sale solution provider
November 2010	Hypercom Corporation	USA	$485M	Transaction processing and network payment technology
September 2010	Semtek Innovative Solutions Corporation	USA	$18M	Endpoint encryption products
September 2010	WAY Systems, Inc.	USA	$9M	Mobile POS platforms and gateway services
May 2010	Orange Logic Ltd.	South Korea	n.a.	Payment systems provider
April 2010	"VeriFone Transportation Systems"	"USA"	"n.a."	"Payment terminals for transportation industry"