Galaxy Gaming Reports Mixed Q3 Results with an Eye on Future Growth

The quarter saw a modest 3% increase in revenue, reaching $6,104K. However, Adjusted EBITDA witnessed a significant 36% decrease, standing at $1,510K. The company also reported a net loss of $(1,455)K, a decline compared to the $(699)K net loss in the same period last year.

Yearly Financial Performance

Looking at the nine-month period of 2023, Galaxy Gaming shows a more positive trend. Revenue increased by 20% to $21,052K, and Adjusted EBITDA grew by 6% to $7,807K.

The net loss for this period was $(988)K, which is an improvement over the $(1,828)K net loss in the same period of 2022.

Balance Sheet Changes

The company’s financial position experienced some shifts. Cash reserves decreased by 13% to $15,938K.

Total long-term debt saw a slight decrease, and stockholders’ deficit increased marginally.

Executive Insights

Todd Cravens, President and CEO of Galaxy, acknowledged challenges in Q3 but remains optimistic about 2023 being a record year. The lower sales of perpetual licenses in Q3 were a contributing factor to the revenue decline. Galaxy’s recent distribution agreement for EZ Baccarat, adding around 500 tables in 120 casinos, is viewed as a strategic move to expand their market presence.

Harry Hagerty, CFO of Galaxy, provided more detailed insights into the financials. Perpetual license sales in Q3 were lower than in the previous two quarters. The revenue in GG Core and GG Digital segments also showed slight variations. The company’s increased expenses were attributed to various factors including cost of sales, compensation costs, legal and regulatory expenses, and an increased allowance for doubtful accounts.

Future Outlook

Galaxy Gaming remains positive about its future, with forecasts for Q4 of fiscal 2023 projecting revenue in the range of $7.0-$7.5 million and Adjusted EBITDA between $2.8-$3.2 million.

These forecasts are based on several assumptions including stable currency exchange rates and no significant external economic impacts.

Our Comment on the Article

Galaxy Gaming’s Q3 2023 financial results present a mixed picture, with a slight revenue increase overshadowed by a significant decline in EBITDA and an increased net loss.

The company’s strategic initiatives, particularly the distribution of EZ Baccarat, indicate a focus on diversifying and expanding its product offerings. The detailed analysis by the executives provides insight into the complexities of the gaming industry and the challenges faced by Galaxy Gaming.