Yahoo Finance Everi Holdings Inc (EVRI) Reports Q1 2024 Earnings: A Detailed Financial Overview
Revenue: Reported $189.3 million, a decrease from $200.5 million in the previous year, exceeding estimates of $188.78 million.
Net Income: Recorded at $4.6 million, significantly below the prior year's $28.1 million and below estimates of $17.78 million.
Earnings Per Share (EPS): Posted at $0.05, a sharp decline from $0.30 year-over-year and below the estimated $0.18.
Free Cash Flow: Amounted to $14.0 million, down from $40.1 million in the same quarter last year.
Operating Income: Decreased to $24.8 million from $52.0 million year-over-year, impacted by $15.7 million in merger-related costs.
Adjusted EBITDA: Dropped to $80.3 million from $92.5 million in the comparable period, reflecting operational challenges.
Capital Expenditures: Increased to $42.7 million from $29.8 million, indicating ongoing investments in technology and product development.
On May 8, 2024, Everi Holdings Inc (NYSE:EVRI), a prominent provider of entertainment and technology solutions for the casino and gaming industry, disclosed its financial results for the first quarter ended March 31, 2024. The company announced these details through its 8-K filing. Everi operates through two segments: Games and Financial Technology Solutions (FinTech), offering a range of products from gaming machines and systems to financial transaction technologies used in casinos.
Company Performance and Strategic Developments
Everi's CEO, Randy Taylor, highlighted the ongoing efforts towards completing a significant merger with IGT's Global Gaming and PlayDigital businesses, expected to conclude later in 2024 or early 2025. This strategic move aims to unlock substantial growth opportunities by merging complementary product offerings across different customer needs, potentially enhancing long-term shareholder value.
The transition to new gaming cabinets and content in the Games segment has been slower than anticipated, although momentum is expected to build in upcoming quarters. The FinTech segment saw growth in its high-margin financial access and software categories, but this was offset by a decline in hardware revenues, which are less predictable quarterly.
Financial Highlights and Challenges
For Q1 2024, Everi reported consolidated revenues of $189.3 million, a decrease from $200.5 million in the same quarter the previous year. The decline was primarily due to lower Games revenues, which stood at $97.1 million compared to $107.4 million in Q1 2023. FinTech revenues slightly decreased to $92.2 million from $93.1 million year-over-year.
Operating income was reported at $24.8 million, significantly lower than the $52.0 million from the prior year, impacted by $15.7 million in merger-related costs. Net income also fell to $4.6 million, or $0.05 per diluted share, from $28.1 million, or $0.30 per diluted share, in Q1 2023. This reduction reflects not only the decreased segment revenues but also increased operating expenses and research and development costs associated with the merger and new product developments.
Operational and Financial Metrics
Key performance metrics for the quarter included a total installed base of 16,917 units across various gaming operations, with daily win per unit (DWPU) at $34.51. The financial access transactions processed totaled $12.4 billion, with hardware sales expected to recover throughout the year.
Everi's balance sheet remains robust with $268.6 million in cash and cash equivalents and a net cash position of $49.6 million. Total debt was slightly reduced to $980.5 million from $986.5 million at the end of December 2023.
Outlook and Forward Strategy
Looking ahead, Everi has adjusted its 2024 outlook, anticipating challenges in the Games segment to affect near-term performance but expecting improvement in the latter half of the year as new products gain traction. The FinTech segment is projected to achieve steady growth following a consistent performance. Adjusted EBITDA for 2024 is expected to be lower than in 2023, with free cash flow also anticipated to decrease.
In conclusion, while Everi faces short-term challenges, particularly in its Games segment, the strategic mergers and expansions into new product lines and geographical areas could set the stage for long-term growth. Investors and stakeholders will likely watch closely how these strategies unfold in the coming quarters.
For further details on Everi's financial performance and strategic initiatives, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from Everi Holdings Inc for further details.
This article first appeared on GuruFocus.
