Core Points - Inspired Entertainment, Inc. has completed the sale of its UK holiday parks business and associated leisure assets to GENDA Inc. for approximately £18.6 million in cash [1][2] - The transaction received all necessary regulatory approvals and met all closing conditions [2] Company Overview: Inspired Entertainment, Inc. - Inspired is a leading B2B provider of gaming content, technology, hardware, and services, operating in approximately 35 jurisdictions worldwide [3] - The company supplies gaming systems and associated terminals for around 75,000 gaming machines and offers virtual sports products through approximately 25,000 retail venues [3] Company Overview: GENDA Inc. - GENDA is a global entertainment company that operates a diverse range of businesses, including amusement, karaoke, lifestyle, tourism, food & beverage, and character merchandising [5][6] - The company operates around 1,100 locations and approximately 14,000 mini-locations across various countries, including Japan, the United States, and the United Kingdom [6]

Group 1: Market Sentiment - Wall Street exhibits a bullish outlook on the stocks discussed, with price targets indicating significant upside potential [1] - Analysts tend to avoid issuing sell ratings due to potential conflicts of interest with their firms seeking business from the companies they cover [1] Group 2: Salesforce (CRM) - Salesforce has a consensus price target of $331.81, suggesting a 38.5% implied return [3] - Currently trading at $239.60 per share, Salesforce has a forward price-to-sales ratio of 5.4x [5] Group 3: Inspired (INSE) - Inspired has a consensus price target of $13.50, indicating a 66.5% implied return [6] - The stock is trading at $8.11 per share, with a forward P/E ratio of 30.2x [8] Group 4: Live Nation (LYV) - Live Nation's consensus price target is $171.55, reflecting a 25% implied return [9] - Demand for Live Nation's offerings has been low, with a weak average annual ARR growth of 9% over the last year [10][11] - Projected sales decline of 10.9% over the next 12 months indicates ongoing deterioration in demand [12]

Financial Performance - Total revenue for Q3 2025 was $86.2 million, an increase of 11.7% compared to $77.2 million in Q3 2024[17]. - Service revenue reached $79.4 million, up 8.9% from $72.9 million in the same quarter last year[17]. - Net loss for Q3 2025 was $1.9 million, compared to a net income of $2.8 million in Q3 2024[17]. - The company reported a comprehensive loss of $1.0 million for Q3 2025, compared to a loss of $2.8 million in Q3 2024[17]. - For the nine months ended September 30, 2025, total revenue reached $226.9 million, an increase from $214.1 million in the same period of 2024, reflecting a year-over-year growth of approximately 5.1%[109]. - The segment operating income for Q3 2025 was $9.7 million, with Gaming contributing $6.4 million and Interactive contributing $8.6 million[107]. - Net income (loss) for the three-month period was $(1.9) million, a decrease of 157% compared to a profit of $2.8 million in the same period in 2024[150]. - Net loss for the three and nine-month periods ended September 30, 2025, was $1.9 million and $9.8 million, compared to net income of $2.8 million and a net loss of $2.2 million in the same periods in 2024[167]. Assets and Liabilities - Total assets increased to $485.8 million as of September 30, 2025, up from $438.4 million at the end of 2024[15]. - Current liabilities rose to $109.1 million, compared to $104.0 million at the end of 2024[15]. - Long-term debt increased to $344.4 million, up from $292.2 million at the end of 2024[15]. - The accumulated deficit increased to $451.3 million as of September 30, 2025, from $441.5 million at the end of 2024[15]. - Total liabilities classified as held-for-sale amount to $10.9 million, with a write-down loss of $5.9 million recognized in net operating income[40]. Cash Flow and Capital Expenditures - Cash flows from operating activities for the nine months ended September 30, 2025, amounted to $50.8 million, an increase from $24.8 million in the prior year[30]. - The company had cash on hand of $36.3 million as of September 30, 2025, with additional working capital of $23.0 million[29]. - Total capital and other long-lived asset expenditures for Q3 2025 were $8.0 million[107]. - Total capital and other long-lived asset expenditures for the nine months ended September 30, 2025, amounted to $27.6 million, reflecting ongoing investments in growth[109]. Debt and Financing - The company issued £270.0 million ($363.5 million) in Series B Notes on June 9, 2025, to refinance existing debt and for general corporate purposes[50]. - The Senior Notes bear interest at a rate of SONIA plus a margin of 5.50% to 6.00% and mature on June 9, 2030[54]. - The outstanding principal amount of senior debt is $363.5 million, with total long-term debt outstanding at $384.6 million as of September 30, 2025[76]. - The Company maintains a maximum consolidated senior secured net leverage ratio of 5.0x, with a reported net leverage of 2.83x as of September 30, 2025[59]. - A secured revolving credit facility of £17.8 million ($24.0 million) was established, set to terminate on December 9, 2029, for general corporate and working capital purposes[64]. Taxation - The effective income tax rate for Q3 2025 was 25.5%, compared to 27.3% in Q3 2024, resulting in a $0.7 million tax benefit for 2025 and a $1.0 million expense for 2024[13]. - For the nine months ended September 30, 2025, the effective tax rate was (44.5)%, leading to a $3.0 million tax expense, while in 2024, it was 14.5% with a $0.4 million benefit[13]. - The One Big Beautiful Bill Act ("OBBBA") signed on July 4, 2025, allows for a higher interest deduction, potentially lowering the Company's income tax expense[88]. Revenue Sources and Growth - Geographic revenue for the UK in the three months ended September 30, 2025, was $63.1 million, up from $59.7 million in the same period of 2024, showing a growth of approximately 5.7%[111]. - The company reported no customers representing at least 10% of total revenue during the three months ended September 30, 2025, indicating a diversified customer base[114]. - Gaming revenue for the three-month period increased by $3.8 million, with product sales up $2.7 million and service sales up $1.1 million[153]. - Interactive revenue for the three-month period increased by $4.5 million, driven by growth in the UK and North America[153]. - Total Gaming Revenue for the three-month period ended September 30, 2025, was £20.1 million, representing a 16% increase from £17.3 million in 2024[193]. Operational Metrics - The number of installed gaming terminals at the end of the period decreased by 1,022 (2.9%) to 33,853 for the three-month period ended September 30, 2025, compared to 34,875 in 2024[173]. - The average selling price per terminal decreased by £4,914 (66.2%) to £2,506 for the three-month period ended September 30, 2025, compared to £7,420 in 2024[173]. - Customer Gross Win per unit per day increased by £2.5 (2.6%) to £97.7 for the three-month period ended September 30, 2025, compared to £95.2 in 2024[173]. - Total Service Revenue for the nine-month period ended September 30, 2025, was $61.0 million, reflecting a 14% increase from $53.6 million in 2024[197]. Miscellaneous - The defined benefit pension scheme has a funding shortfall, with a recovery plan in place expected to eliminate the shortfall by October 31, 2026[100]. - The company identified immaterial errors in previously reported financial statements for the periods ended March 31, June 30, and September 30, 2024, leading to revisions in the financial statements[116].

Group 1 - The article does not provide any relevant content regarding company or industry insights [1]

Core Insights - Inspired Entertainment reported quarterly earnings of $0.28 per share, missing the Zacks Consensus Estimate of $0.30 per share, but showing an increase from $0.12 per share a year ago, resulting in an earnings surprise of -6.67% [1] - The company posted revenues of $86.2 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 2.21% and increasing from $78 million year-over-year [2] - The stock has underperformed, losing about 16.1% since the beginning of the year compared to the S&P 500's gain of 15.1% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.39 on revenues of $84.17 million, and for the current fiscal year, it is $0.64 on revenues of $309.21 million [7] - The estimate revisions trend for Inspired Entertainment was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Technology Services industry, to which Inspired Entertainment belongs, is currently in the top 39% of over 250 Zacks industries, suggesting that stocks in the top 50% outperform those in the bottom 50% by more than 2 to 1 [8] - Another company in the same industry, Airship AI Holdings, Inc., is expected to report quarterly earnings of $0.02 per share, reflecting a year-over-year change of +133.3%, with revenues projected to be $8.3 million, up 189.2% from the previous year [9]

Financial Data and Key Metrics Changes - The company reported Q3 adjusted EBITDA of $32.3 million and trailing 12-month adjusted EBITDA of $110 million, both exceeding consensus expectations [3][10] - The trailing 12-month revenue reached $310 million, with an adjusted EBITDA margin of 35% [16][19] Business Line Data and Key Metrics Changes - The interactive segment achieved over 40% year-over-year adjusted EBITDA growth for the ninth consecutive quarter, with October being the largest revenue month in the segment's history [7][10] - The virtual sports segment showed stabilization for the second consecutive quarter, with expectations for year-over-year growth in Q4 [7][10] Market Data and Key Metrics Changes - The company is gaining market share in the U.K. and North America, with strong performance noted in both regions [7][13] - In North America, performance in Illinois and key Canadian provinces reached the highest levels since product introduction [15] Company Strategy and Development Direction - The sale of the holiday parks business is a strategic move to enhance adjusted EBITDA margins, reduce capital expenditures, and lower headcount by nearly 40% [8][19] - The company plans to increase game deliveries through a new interactive studio to meet customer demand for more content [11][49] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating potential tax changes in the U.K. gaming industry, citing past experiences with similar challenges [5][6] - The company anticipates significant operating leverage from the expansion of iGaming states, viewing it as a transformational opportunity [11][19] Other Important Information - A $25 million share buyback plan has been reauthorized as part of the company's future plans [8][19] - The company is focusing on organic growth without immediate expectations of M&A impacts, although it continues to evaluate potential tuck-in acquisitions [20][27] Q&A Session Summary Question: Can you walk through the revenue growth and margin expectations? - Management indicated that the holiday parks business's divestiture is the main driver for projected revenue changes, while other segments are expected to grow [22][23] Question: What gives confidence in the virtual sports segment's growth? - Adjustments with major customers and new customer additions in Brazil and Turkey are expected to drive growth in the virtual sports segment [24][25] Question: Can you elaborate on M&A strategy? - The company is focused on tuck-in acquisitions that enhance existing operations, avoiding large diversification deals [26][27] Question: What is the status of the interactive studio? - The new interactive studio will be developed organically, with plans to enhance content offerings [34][35] Question: How does the company view share buybacks? - The share buyback will be opportunistic, balancing leverage reduction and potential M&A opportunities [37][39] Question: What is the outlook for the interactive business growth? - The company expects continued strong growth in the interactive segment, driven by increased game delivery and customer demand [48][49]

Third Quarter 2025 Earnings NOVEMBER 5, 2025 Safe Harbor / Non-GAAP Financial Disclosures Forward-Looking Statements This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements regarding our business strategy, plans and objectives and our expected or contemplated future operations, results, financial condition, beliefs and intentions. In addition, any statements ...

Revenue Performance - Revenue for Q3 2025 was $86.2 million, an increase of 12% year-over-year, primarily driven by record Interactive revenue, which rose 48% year-over-year[3] - Total revenue for Q3 2025 was $86.2 million, a 11.7% increase from $77.2 million in Q3 2024[34] - Service revenue increased to $79.4 million in Q3 2025, up from $72.9 million in Q3 2024, representing a growth of 17.9%[34] - Total revenue for the nine months ended September 30, 2025, was $226.9 million, a 5.1% increase from $214.1 million in the same period of 2024[50][51] Adjusted EBITDA - Adjusted EBITDA for Q3 2025 was $32.3 million, up 11% from the prior year, with Interactive Adjusted EBITDA reaching an all-time high, increasing 55% year-over-year[3] - Fourth quarter 2025 Adjusted EBITDA is expected to increase year-over-year, with full year 2025 Adjusted EBITDA projected to exceed $110 million[3] - Adjusted EBITDA for the nine months ended September 30, 2025, was $79.1 million, up from $69.1 million in the prior year, reflecting a 14.5% increase[50][51] Net Income and Loss - The company reported a net loss of $1.9 million for Q3 2025, compared to a net income of $2.8 million in Q3 2024[4] - Net loss for Q3 2025 was $1.9 million, compared to a net income of $2.8 million in Q3 2024[34] - The company reported a comprehensive loss of $1.0 million for Q3 2025, compared to a loss of $2.8 million in Q3 2024[34] - Net loss for the nine months ended September 30, 2025, was $9.8 million, compared to a net loss of $2.2 million for the same period in 2024[38] Debt and Liabilities - Long-term debt increased to $344.4 million as of September 30, 2025, compared to $292.2 million at December 31, 2024, marking an increase of 17.9%[36] - Total current liabilities rose to $109.1 million as of September 30, 2025, compared to $104.0 million at December 31, 2024, an increase of 4.9%[36] - The company incurred $365.7 million in new debt during the nine months ended September 30, 2025, to support its operations and growth initiatives[38] Operational Efficiency - The company is optimizing workforce efficiency, reducing headcount from 1,460 to 975 employees by year-end 2025[12] - Selling, general and administrative expenses were $31.7 million in Q3 2025, slightly up from $31.4 million in Q3 2024[34] Strategic Initiatives - The sale of the UK holiday parks business for £18.6 million is expected to close on November 7, 2025, supporting the transition to a higher-margin digital-led business model[3] - The divestiture of the lower-margin holiday parks business is expected to enhance capital flexibility and support future growth investments[17] - The company launched new products, including the Hybrid Dealer™, which won the Global Gaming Award for Innovative Product of the Year[2] - Inspired expanded its presence in Brazil by launching Virtual Sports with six new operators during Q3 2025[11] - A $25 million share repurchase program has been authorized by the Board, reflecting confidence in the company's growth prospects[3] Segment Performance - The Gaming segment contributed $76.0 million, accounting for 33.5% of total revenue, while the Sports segment generated $27.2 million, representing 12.0% of total revenue[50] - The Interactive segment's revenue was $40.8 million, contributing 18.0% to total revenue, and the Leisure segment accounted for $82.9 million, or 36.5% of total revenue[50] - Segment-level adjusted EBITDA for Gaming was $27.8 million, for Sports was $16.9 million, for Interactive was $23.5 million, and for Leisure was $10.9 million[50] Cash Flow - Net cash provided by operating activities was $50.8 million for the nine months ended September 30, 2025, compared to $24.8 million for the same period in 2024, indicating a 104.8% increase[38] - Cash and cash equivalents at the end of the period were $36.3 million, slightly down from $36.5 million at the end of the previous period[38] Market Outlook - The company anticipates potential new customers and expects to execute its strategic plan in various markets[30] - The company plans to continue focusing on market expansion and new product development to drive future growth[50][51] - The overall performance indicates a positive trend in revenue growth and profitability across key segments, positioning the company for future opportunities[50][51]

Core Insights - Inspired Entertainment, Inc. reported strong financial results for Q3 2025, with total revenue of $86.2 million, a 12% increase year-over-year, primarily driven by record Interactive revenue, which rose 48% [5][3] - The company is undergoing a strategic evolution towards a more digital and higher-margin business model, highlighted by the divestiture of its UK holiday parks business for £18.6 million [8][10] - The company expects continued growth in Adjusted EBITDA, projecting it to exceed $110 million for the full year 2025, supported by strong performance in the Interactive segment [5][11] Financial Performance - Total revenue for Q3 2025 was $86.2 million, up from $77.2 million in Q3 2024, with Interactive revenue reaching $15.1 million, a 48% increase [5][3] - Net operating income decreased to $9.7 million from $11.2 million year-over-year, while the company reported a net loss of $1.9 million compared to a net income of $2.8 million in the previous year [5][3] - Adjusted EBITDA for Q3 2025 was $32.3 million, an 11% increase from $29.2 million in Q3 2024, driven by a 55% increase in Interactive Adjusted EBITDA [5][6] Strategic Developments - The divestiture of the holiday parks business is part of the company's strategy to transition towards a digital-led model, which is expected to enhance margins and operational agility [8][10] - The company has formed a strategic partnership with Gaming Arts LLC to adapt its online slot titles for land-based markets, further reinforcing its digital growth strategy [10] - Inspired's Hybrid Dealer™ product won the Global Gaming Award for Innovative Product of the Year, showcasing the company's commitment to innovation [10] Market Position and Future Outlook - The company is gaining market share in its largest markets and anticipates further growth as it rolls out new titles and multiplayer experiences [2][5] - Management remains confident in its strategic direction, expecting fourth quarter 2025 Adjusted EBITDA to increase year-over-year, supported by strong momentum in the Interactive segment [11][5] - The company aims to optimize operations and reduce headcount from 1,460 to 975 employees by the end of 2025 to enhance efficiency and drive higher Adjusted EBITDA margins [15]

Core Insights - Inspired Entertainment, Inc. will report its financial results for Q3 2025 on November 5, 2025, before market opens [1] - A conference call and webcast will be held on the same day at 8:00 a.m. ET to discuss the results [1] Company Overview - Inspired Entertainment is a leading B2B provider of gaming content, technology, hardware, and services [4] - The company operates in approximately 35 jurisdictions globally, supplying gaming systems and content for around 50,000 gaming machines [4] - Inspired offers a diverse portfolio including gaming, Virtual Sports, interactive products, and leisure solutions, appealing to a wide range of players [4]