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Q1 Earnings Highs And Lows: Inspired (NASDAQ:INSE) Vs The Rest Of The Gaming Solutions Stocks


Petr Huřťák /
2024/06/26 6:23 am EDT

Earnings results often indicate what direction a company will take in the months ahead. With Q1 now behind us, let’s have a look at Inspired (NASDAQ:INSE) 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 decent Q1; on average, revenues beat analyst consensus estimates by 3.3%. Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good end of 2023. But the beginning of 2024 has seen more volatile stock performance due to mixed inflation data, and gaming solutions stocks have held roughly steady amidst all this, with share prices up 2.9% on average since the previous earnings results.

Weakest Q1: Inspired (NASDAQ:INSE)

Specializing in digital casino gaming, Inspired (NASDAQ:INSE) is a provider of gaming hardware, virtual sports platforms, and server-based gaming systems.

Inspired reported revenues of $63.1 million, down 2.8% year on year, falling short of analysts' expectations by 2.8%. It was a weak quarter for the company, with a miss of analysts' operating margin and earnings estimates.

“As we begin 2024, we remained focused on our long-term strategy to shift a greater proportion of our earnings to our aggregate digital business, which includes our Virtual Sports and Interactive segments. In the first quarter, our digital business accounted for 76% of our Adjusted EBITDA contribution1 compared to 69% in the prior year. At the same time our strategy of moving our retail business in the capital light direction is taking hold as well,” said Lorne Weil, Executive Chairman of Inspired.

Inspired Total Revenue

Inspired delivered the weakest performance against analyst estimates of the whole group. The stock is down 2.9% since the results and currently trades at $9.18.

Read our full report on Inspired 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 $217.4 million, up 33.9% year on year, outperforming analysts' expectations by 9.8%. It was an incredible quarter for the company, with an impressive beat of analysts' earnings estimates.

Rush Street Interactive Total Revenue

Rush Street Interactive pulled off the biggest analyst estimates beat and highest full-year guidance raise among its peers. The stock is up 47.7% since the results and currently trades at $9.45.

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

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, in line with analysts' expectations. It was a weak quarter for the company, with a miss of analysts' operating margin and earnings estimates.

Everi had the slowest revenue growth in the group. The stock is down 3% since the results and currently trades at $7.85.

Read our full analysis of Everi's results here.

Light & Wonder (NASDAQ:LNW)

With names as crazy as Ultimate Fire Link Power 4 for its products, Light & Wonder (NASDAQ:LNW) is a gaming company supplying the casino industry with slot machines, table games, and digital games.

Light & Wonder reported revenues of $756 million, up 12.8% year on year, surpassing analysts' expectations by 5.4%. It was a very strong quarter for the company, with an impressive beat of analysts' operating margin estimates and a decent beat of analysts' earnings estimates.

The stock is up 5.4% since the results and currently trades at $101.74.

Read our full, actionable report on Light & Wonder 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 $590.9 million, up 5.6% year on year, surpassing analysts' expectations by 4.4%. It was a very strong quarter for the company, with an impressive beat of analysts' earnings estimates and a decent beat of analysts' Horse Racing revenue estimates.

The stock is up 12.4% since the results and currently trades at $138.78.

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

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