Everi’s Q1 Performance: A Dip Amidst Strategic Transitions
Everi Holdings Inc. reported a decrease in consolidated revenues for the first quarter of 2024, totaling $189.3 million, down from $200.5 million in Q1 2023.
Gaming Segment Performance
In the gaming segment, Everi’s revenues dropped to $97.1 million, slightly down from the previous year. Notably, the decline in the installed base was partly due to Everi’s deliberate strategy to avoid replacing cabinets in lower-performing locations. The recent launches of the Dynasty Sol cabinet in late Q4 2023 and the premium-leased Dynasty Sol Sync cabinet in Q1 2024 are anticipated to gain traction as new games are introduced.
Randy Taylor, Chief Executive Officer of Everi, commented on the gaming segment’s progress: “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.”
FinTech Segment Analysis
FinTech revenues were also slightly down, totaling $92.2 million year over year and sequentially. The early quarter’s bad weather negatively impacted financial access revenues, affecting much of Everi’s customer base. However, an uptick in same-store volumes towards the quarter’s end indicates a steady improvement, expected to continue into Q2. The first quarter saw a decline in hardware sales, primarily due to reduced ticket redemption kiosk sales in specific international markets and lower loyalty equipment sales, attributed to the timing of initial software sales and installations. Everi projects growth in hardware sales over the year despite these fluctuations.
Taylor highlighted the mixed performance within the FinTech division, noting, “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.”
Strategic Investments and Future Outlook
Everi is also focused on long-term growth through significant investments in its workforce and technology, aimed at developing next-generation products. This strategy includes the anticipated introduction of video lottery terminal (VLT) placements and new gaming products for the Australian market in the latter half of 2024. While these investments have increased payroll and related expenses, the company believes they will drive substantial revenue growth and long-term success.
CEO Randy Taylor expressed optimism about the company’s strategic direction and upcoming merger: “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.”
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