Hypercom Corporation Annual Report - CiteSeer

i.
to our StoCkhoLderS, CuStomerS, partnerS, and empLoyeeS:
Despite a global economic recession that created the most difficult business environment since the Great Depression,
Hypercom Corporation made significant gains financially in 2009, increased our customer base, led the industry in security,
and completed the transition of our business model from manufacturing to providing value-added solutions and services.
The worldwide recession further validated our strategy already planned
for 2009 to leverage localized capabilities across the organization,
many of which resulted from completing the integration of our Thales
e-Transactions acquisition. Our reshaped senior management team
worked together to align our vision and processes globally in businesscritical
departments, most notably in Finance with the hiring of Thomas
B. Sabol as Chief Financial Officer, and in our software platform, which
is now fully unified under the direction of Nassrin Tavakoli who joined
us as Senior Director of Global Software Engineering.
Among many other initiatives, our market-facing projects included
repositioning our HBNet business to create Phoenix Managed
Networks, LLC with The McDonnell Group to provide transaction
transport service to payment processors, banks and retailers
worldwide. Internally, we implemented a common IT infrastructure
and ERP system for all Hypercom sites. Internally and externally, we
pursued activities that aligned our organization with Hypercom’s
global strategic goals.
operating diSCipLine to inCreaSe
groSS margin
In line with our 2009 goal to reduce our production costs, we
advanced beyond our fully outsourced manufacturing model to include
joint design manufacturing (JDM), in which we provide specifications
to partners who design, develop and manufacture our hardware. As
a result, we expect to be in a unique position to add features to our
hyperCom Corporation
Philippe Tartavull
Chief Executive Officer and President
products while simultaneously reducing costs, as well as shorten our
time to market with new products. JDM will enable the company
to focus even more attention on our core competency of developing
value-added services on our software platform. We began our
transition to a JDM model in 2009, while paying close attention to
minimizing any potential impact on our customers.
In addition to these initiatives, which were targeted at increasing our
gross margins, company leaders responded to the economic downturn
by sharpening Hypercom’s focus on finding opportunities to align costs
properly and utilize resources more effectively. These actions have
not only helped us weather the economic downturn, but as soon as
the global economy begins to recover, will enable us to compete more
aggressively with resources focused directly on delivering the greatest
results. We are more efficient, agile, and competitive today than we
were before the recession began.
paving the way with innovation
in SeCurity
2009 marked another year of increased market demand for valueadded
solutions. In security, no competitor had a better product
lineup than Hypercom, perhaps the most of which was our industryleading
array of end-to-end encryption solutions. Some of Hypercom’s
2009 security highlights include the following:
• Introduced the HyperSafe ® Remote Key System (HRKS), the
industry’s first standards-based remote key injection solution