Supplier News
Everi down slightly in Q1 as fintech and gaming both dip
By Phil - 9 May 2024
Everi’s consolidated revenues for the three-month period ended March 31, 2024 dipped slightly coming in at $189.3m compared to $200.5m in the year-ago first quarter.
Games revenues of $97.1m were down from the prior year period, and essentially flat on a quarterly sequential basis as the company continues to transition to its new family of cabinets and content. Approximately half of the decline in the installed base during the quarter is attributable to the Company’s proactive decisions not to replace cabinets in lower performing locations. The company launched its new for-sale Dynasty Sol cabinet late in the 2023 fourth quarter and its new, premium-leased Dynasty Sol Sync cabinet late in the 2024 first quarter. These cabinets are expected to continue to grow in popularity as new games are introduced.
FinTech revenues of $92.2m were down slightly year over year and on a quarterly sequential basis. Financial access revenues experienced more modest growth in the quarter with bad weather impacting a large portion of the Company’s customer base early in the quarter. Same store volumes began to improve late in the first quarter and remain steady throughout the early part of the second quarter. In the first quarter, the Company experienced a decline in hardware sales, primarily from reduced unit sales of our ticket redemption kiosks in certain foreign jurisdictions and lower loyalty equipment sales due to timing of initial software sales and installations. FinTech Hardware sales tend to be large purchases tied to new contracts and contract renewals, and therefore, revenues can fluctuate on a quarterly basis. The Company expects to see growth in hardware sales for the year.
Randy Taylor, Chief Executive Officer of Everi, said: “We are making progress on the steps necessary to complete our proposed merger with IGT’s Global Gaming and PlayDigital businesses later this year or in early 2025. We are excited about the significant growth opportunities we believe this combination will unlock. This transaction will bring together a comprehensive and complementary product set focused on our customers and their diverse needs which we believe will deliver substantial long-term value to our shareholders.
“During the first quarter our games segment continued to make progress in our transition to our newest family of cabinets and new and innovative content to support these cabinets. While this transition has been slower than anticipated, we are gaining momentum with these efforts and expect our progress will continue to accelerate throughout the back half of the year. Starting in the second quarter we expect this momentum to translate into improvements in sequential quarterly unit sales. We will continue to support our portfolio of game products following the closing of the proposed merger.
“For our FinTech business, our highest margin financial access and software and other revenue categories continued to grow in the first quarter, though this growth was more than offset by a decline in hardware revenues, which are less predictable on a quarterly basis. Following the impact from weather related headwinds early in the year, our financial access revenue trends continued to improve, and we expect more consistent growth trends to continue. In addition, we expect consolidated hardware sales will recover over the balance of the year.
“Over the last several years, we have increased our investments in our employees and technology to develop our next generation of products that positions the Company for long-term growth. While conversion of these investments into increased revenues has taken longer than initially anticipated, we are on track to begin to deliver on several of our initiatives in the second half of 2024, including our initial video lottery terminal (“VLT”) placements and our first gaming products for Australia. While our investments have led to higher payroll and related expenses, we believe investing in new products for our FinTech segment, for-sale and for-lease gaming products and products focused on new segments and jurisdictions will drive revenue growth in the second half of 2024 and position the Company for long-term success.”
