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At the halfway point of 2017, Cardtronics CEO Steve Rathgaber acknowledges that the atmosphere in the ATM business is somewhat unsettled — particularly in the company's core market, the United States.

In a Q2 earnings call late last week, Rathgaber referred to a "perfect storm" of events that are making it unusually difficult to understand the company's evolving same-store transaction data and to translate it into a forecast for the future.

"There are just too many moving parts to see clearly without the passage of some additional time," he told analysts on the call.

What the company does know is that the software update and EMV migration that played havoc with uptime throughout Cardtronics' U.S. fleet has now been mostly resolved.

Additionally, new agreements this year have managed to replace at least some of the revenue from the 8,000 ATMs that Cardtronics is now in the process of removing from 7-Eleven stores following last month's parting of ways between the longstanding partners.

Further, the company is currently integrating the largest acquisition in its corporate history — DCPayments — with the expectation that it will quickly bring the company to scale in both new and existing markets.

Also importantly, Cardtronics has shed $35 million in expenses over the past year while improving availability and services.

Additionally, Rathgaber said, the company has assembled a new senior management team of "exceptional industry depth and experience. And we are investing to strengthen elements of our core product and service infrastructure. So I feel that we are preparing very well for the next stage of our growth journey."

Still that journey will present challenges as Cardtronics makes its way through the fast-evolving and brutally competitive world of consumer payments.

As Rathgaber put it, "… [T]he same global industry trends that create unique opportunities for our company apply some pressure to our own economics. I am speaking of the gradually declining volumes of cash usage that manifest in the form of reduced ATM use."

However, he said, what presents a growing headwind in the near term also offers additional lift for the company over the longer haul.

"Our thesis has been and remains that gradual declines of cash use and ATM transactions enable a future source of growth for Cardtronics," he said.

This makes absolutely no sense at all … until you consider the side effects that declining cash will almost certainly produce.

These include cost pressures on financial institutions that operate their own ATM fleets, combined with ongoing branch closures for those same FIs as customers migrate in greater numbers to digital banking methods.

Rathgaber explained that this global trend in banking will present the opportunity to consolidate traffic at Cardtronics ATMs in all the markets the company serves.

"Cardtronics is mission-critical banking infrastructure, connecting our physical ATM network to the financial institution's digital offerings," Rathgaber said.

He added that the company believes it is seeing signs...

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