Everi Holdings Inc., a prominent fintech and loyalty solutions provider, faced a challenging first quarter in 2024. The company experienced a 5.6% decline in revenue, totaling US$189.3 million, along with a 13.2% decrease in Adjusted EBITDA, which stood at US$80.3 million. These downturns were primarily attributed to a decline in core business segments coupled with increased costs. Notably, net income plummeted from US$28.1 million to US$4.6 million compared to the same period the previous year.
In the Games segment, revenues fell by 9.5% to US$97.1 million, remaining stagnant quarter-on-quarter. This decline was largely influenced by Everi’s transition to a new family of cabinets and content. The company specifically highlighted its decision not to replace cabinets in lower-performing locations as a contributing factor. Despite these challenges, Everi expressed optimism regarding the potential growth of its new Dynasty Sol cabinets, expecting an uptick in popularity with the introduction of new games.
On the other hand, the FinTech segment saw a marginal decrease in revenues to US$92.2 million. This dip was primarily driven by a decline in hardware sales, particularly in ticket redemption kiosks in certain foreign jurisdictions and lower loyalty equipment sales due to timing issues with initial software sales and installations. Everi clarified that FinTech hardware sales often fluctuate on a quarterly basis due to the nature of large purchases tied to new contracts and contract renewals.
CEO Perspective and Future Outlook
Everi’s CEO, Randy Taylor, acknowledged the company’s ongoing efforts to finalize its proposed merger with IGT’s Global Gaming and PlayDigital businesses. Taylor expressed confidence in the merger, anticipating significant growth opportunities and long-term value for shareholders. He emphasized Everi’s strategic investments in employees and technology to develop next-generation products, positioning the company for sustained growth. While acknowledging that the conversion of these investments into increased revenues has been slower than anticipated, Taylor remains optimistic about delivering on various initiatives in the second half of 2024, including initial video lottery terminal placements and gaming products for Australia.
Investment and Growth Strategy
Despite higher payroll and related expenses stemming from increased investments, Everi remains committed to driving revenue growth and positioning itself for long-term success. The company’s focus on developing new products for its FinTech segment, as well as for-sale and for-lease gaming products tailored to different segments and jurisdictions, underscores its dedication to innovation and market expansion.
Despite facing challenges in the first quarter of 2024, Everi Holdings Inc. remains optimistic about its future prospects. With strategic investments in technology and a forthcoming merger with IGT’s gaming businesses, the company aims to unlock significant growth opportunities and deliver long-term value to its shareholders. As Everi continues to navigate market dynamics and execute its growth strategy, stakeholders can anticipate further developments in the latter half of 2024 and beyond.