As the Q1 earnings season wraps, let’s dig into this quarter’s best and worst performers in the gaming solutions industry, including Everi (NYSE:EVRI) and its peers.

Gaming solution companies operate in a dynamic and evolving market, and the digital transformation of the gaming industry presents significant opportunities for innovation and growth, whether it be immersive slot machine terminals or mobile sports betting. However, the gaming solution industry is not without its challenges. Regulatory compliance is a crucial consideration as companies must navigate a complex and often fragmented regulatory landscape across different jurisdictions. Changes in regulations can impact product offerings, operational practices, and market access, requiring companies to maintain flexibility and adaptability in their business strategies. Additionally, the competitive nature of the industry necessitates continuous investment in research and development to stay ahead of competitors and meet evolving consumer demands.

The 8 gaming solutions stocks we track reported a mixed Q1. As a group, revenues beat analysts’ consensus estimates by 1.6%.

Thankfully, share prices of the companies have been resilient as they are up 7.3% on average since the latest earnings results.

Everi (NYSE:EVRI)

Formed between the 2015 merger of Global Cash Access and Multimedia Games, Everi (NYSE:EVRI) is a producer of games and financial infrastructure for the casino and hospitality industries.

Everi reported revenues of $189.3 million, down 5.5% year on year. This print was in line with analysts’ expectations, but overall, it was a slower quarter for the company with a miss of analysts’ operating margin estimates.

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.

Interestingly, the stock is up 64.5% since reporting and currently trades at $13.31.

Read our full report on Everi here, it’s free.

Best Q1: Rush Street Interactive (NYSE:RSI)

Specializing in online casino gaming and sports betting, Rush Street Interactive (NYSE:RSI) is an operator of digital gaming platforms.

Rush Street Interactive reported revenues of $220.4 million, up 33.5% year on year, outperforming analysts’ expectations by 9.4%. The business had an incredible quarter with an impressive beat of analysts’ earnings and EBITDA estimates.

Rush Street Interactive scored the biggest analyst estimates beat, fastest revenue growth, and highest full-year guidance raise among its peers. The market seems content with the results as the stock is up 3.3% since reporting. It currently trades at $10.32.

Is now the time to buy Rush Street Interactive? Access our full analysis of the earnings results here, it’s free.

Weakest Q1: PlayStudios (NASDAQ:MYPS)

Founded by a team of former gaming industry executives, PlayStudios (NASDAQ:MYPS) offers free-to-play digital casino games.

PlayStudios reported revenues of $72.59 million, down 6.7% year on year, falling short of analysts’ expectations by 2.6%. It was a softer quarter as it posted full-year revenue guidance missing analysts’ expectations and a miss of analysts’ daily active users estimates.

PlayStudios delivered the weakest performance against analyst estimates, slowest revenue growth, and weakest full-year guidance update in the group. The company reported 13.6 million monthly active users, down 2% year on year. As expected, the stock is down 25.6% since the results and currently trades at $1.45.

Read our full analysis of PlayStudios’s results here.

DraftKings (NASDAQ:DKNG)

Getting its start in daily fantasy sports, DraftKings (NASDAQ:DKNG) is a digital sports entertainment and gaming company.

DraftKings reported revenues of $1.10 billion, up 26.2% year on year. This print met analysts’ expectations. It was a strong quarter as it also recorded an impressive beat of analysts’ operating margin estimates and full-year revenue guidance exceeding analysts’ expectations.

The stock is up 2.5% since reporting and currently trades at $36.39.

Read our full, actionable report on DraftKings here, it’s free.

Churchill Downs (NASDAQ:CHDN)

Famous for hosting the Kentucky Derby, Churchill Downs (NASDAQ:CHDN) operates a horse racing, online wagering, and gaming entertainment business in the United States.

Churchill Downs reported revenues of $628.5 million, up 9.8% year on year. This number was in line with analysts’ expectations. More broadly, it was a slower quarter as it produced a miss of analysts’ earnings estimates.

The stock is up 4.5% since reporting and currently trades at $140.20.

Read our full, actionable report on Churchill Downs here, it’s free.

Market Update

After much suspense, the Federal Reserve cut its policy rate by 50bps (half a percent) in September 2024. This marks the central bank’s first easing of monetary policy since 2020 and the end of its most pointed inflation-busting campaign since the 1980s. Inflation had begun to run hot in 2021 post-COVID due to a confluence of factors such as supply chain disruptions, labor shortages, and stimulus spending. While CPI (inflation) readings have been supportive lately, employment measures have prompted some concern. Going forward, the markets will debate whether this rate cut (and more potential ones in 2024 and 2025) is perfect timing to support the economy or a bit too late for a macro that has already cooled too much.

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