In This Article:
Slot machine and terminal operator Accel Entertainment (NYSE:ACEL) reported revenue ahead of Wall Street’s expectations in Q1 CY2025, with sales up 7.3% year on year to $323.9 million. Its non-GAAP profit of $0.23 per share was 17.8% above analysts’ consensus estimates.
Is now the time to buy ACEL? Find out in our full research report (it’s free).
Accel Entertainment (ACEL) Q1 CY2025 Highlights:
-
Revenue: $323.9 million vs analyst estimates of $318.8 million (7.3% year-on-year growth, 1.6% beat)
-
Adjusted EPS: $0.23 vs analyst estimates of $0.20 (17.8% beat)
-
Adjusted EBITDA: $49.51 million vs analyst estimates of $48.06 million (15.3% margin, 3% beat)
-
Operating Margin: 8%, in line with the same quarter last year
-
Free Cash Flow Margin: 5.6%, up from 2.7% in the same quarter last year
-
Video Gaming Terminals Sold: 27,180, up 1,151 year on year
-
Market Capitalization: $991.1 million
StockStory’s Take
Accel Entertainment's first quarter results were driven by continued growth in core markets and the integration of newly acquired operations. Management highlighted stable revenue in Illinois and Montana, double-digit gains in Nebraska and Georgia, and early momentum in Louisiana following recent acquisition activity. The company also completed Phase 1 construction of the Fairmount Park Casino in Illinois ahead of schedule and under budget, signaling operational execution and expansion potential in a new vertical.
Looking forward, management cited favorable trends in customer behavior and ongoing operational efficiencies as reasons for confidence in sustained growth. CEO Andy Rubenstein pointed to Accel's decentralized and scalable model as a foundation for capital flexibility, while President Mark Phelan noted that early results at Fairmount Park Casino are encouraging. The company plans to continue optimizing its portfolio and expects that recently implemented technology and proprietary content will drive differentiation and future performance.
Key Insights from Management’s Remarks
Accel Entertainment’s leadership identified several operational achievements and market trends influencing the quarter’s results and future outlook. The company’s approach centers on leveraging its distributed gaming model, integrating new acquisitions, and optimizing its asset base.
-
Core Market Stability: Illinois and Montana, Accel’s largest states, delivered consistent year-over-year revenue growth, demonstrating resilience in established markets despite competitive pressures.
-
New Market Expansion: The acquisition and integration of Louisiana operations added 96 locations and 614 terminals, contributing to revenue growth and broadening Accel’s southeastern presence. Management sees potential for ongoing operational improvements in this region.
-
Fairmount Park Casino Launch: The opening of Fairmount Park Casino, Illinois’ first racino, marks a milestone. The property opened ahead of Derby Day, and early customer engagement has been positive. Management expects the casino to become a key growth driver as marketing ramps up and additional amenities come online.
-
Portfolio Optimization: Accel continues to prune underperforming locations in Illinois and apply similar optimization strategies in other markets. This reallocation aims to boost overall profitability and capital returns by focusing on higher-margin properties.
-
Leadership Transition: CFO Matt Ellis’s planned departure was announced, with President Mark Phelan stepping in as interim CFO. Management expects a seamless transition, citing Phelan’s financial and operational experience.