Galaxy Gaming reported a loss of $27.8m ($22.0m/EUR25.7m) for the 2023 fiscal year, despite an increase of 18.8% in revenue.
In 2023, revenue was up across all operations (land-based as well as digital) Galaxy Gaming posted another net loss in 2023, despite the fact that costs were also on the rise.
Matt Reback, CEO and President, was generally pleased with the results. Reback was hired by Galaxy to replace Todd Cravens who had been leading the company since mid-2017.
Reback, in his analysis of the results for Galaxy, highlighted that revenue growth was a positive. Reback also expressed his enthusiasm for future business prospects.
Reback stated that “we believe the opportunistic sale of perpetual licenses peaked by 2023.” In 2024, we will switch to a model of sustainable growth based on revenue from our core felt and premium products library, GOS and our gaming business.
I have been at Galaxy for four months and half and I am excited by the future prospects of the company.
Over the medium term, we’ll develop a strategy that allows us to maintain double-digit growth in revenue through organic growth as well as potential acquisitions.
Galaxy’s land-based strategy is the best way to go
In 2023, the GG Core business remained the main source of revenues. Revenue from this segment rose 25.7% during the year to $19.3m.
Galaxy claimed that this growth was due to the $3.7m in revenue generated from perpetual licenses sold to clients, an increase of 1,226.5%. Some of the increases can be attributed to a new distributor agreement.
GG Core’s revenue also increased year-on-year in the GG digital business. Digital revenue increased by 4.8%, from $8.0m to $8.4m.
Galaxy said that this increase was due to the growth of online customers in both traditional and new markets.
In terms of revenue, $17.0m came in from the Americas. This represents a 34.9% increase. Other $10.8m came from Europe, Middle East, and Africa. This is a 0.9% decrease from 2022.
Net loss still remains despite higher spending
Operating expenses for 2023 were higher by 21.3% at $21.1m. The main reason for this was the 25.6% increase in sales, general and administration spending.
Operating profit rose by $9.8%, to $6.7m. The higher finance related expenses of $8.5m resulted in a loss before tax of $1.7m compared with $1.6m the year prior.
Galaxy reported a total tax of $79,228 but a foreign exchange translation benefit of $51,612. It ended up with a loss net of $1.8m which was the same as the previous year.
The adjusted EBITDA increased by 1.0%, to $10,6m.
The same story is expected in the Q4
Galaxy has only released certain numbers for the third quarter. This included an increase of 6.4% in the net revenue, which reached $6.7m.
GG Core revenues increased 18.0% to $4.6m, but GG Digital revenues fell 12.5% to $2m.
The group’s net loss in the third quarter was $820,000, compared to $55,000 in profit in 2022. The adjusted EBITDA also declined by 10.0%, to $2.8m.
