Company: ACEL
Filing Date: 2025-08-05
Form Type: 10-Q
Source: 0001698991-25-000034
Chunk: 41

Company: Accel Entertainment, Inc.
Filing Date: 2025-08-05
Form: 10-Q
Item: Item 1
Chunk 41
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 SplitsNegotiated SplitsNet terminal income splits are statutorily predetermined; minimum and maximum wagers are mandated by the applicable governing bodiesNet terminal income splits are negotiated Pricing is not considered a factor as revenue splits with our locations are mandated by lawPricing is a driver in contract negotiations as all revenue splits are negotiatedLocation and customer experience are key differentiating factors for selecting us over our competitorsOur focus on player appeal, customer service and reputation are also key factors impacting competitionOur markets with statutory splits are: Illinois, Georgia, PennsylvaniaOur markets with negotiated splits are: Montana, Nevada, Nebraska, Iowa, Louisiana

Macroeconomic Factors 

Ongoing interest rate uncertainty, persistent inflation and increased and/or reciprocal tariffs may increase the risk of an economic recession and volatility in the capital or credit markets in the U.S. and other markets globally. Our location partners may be adversely impacted by changes in overall economic and financial conditions, and certain location partners may cease operations in the event of a recession or inability to access financing. Furthermore, our revenue is largely driven by players’ disposable incomes and level of gaming activity, and economic conditions that adversely impact players’ ability and desire to spend disposable income at our locations partners may adversely affect our results of operations and cash flows.

For the first half of 2025, we have not observed material impacts to our business or outlook from the macroeconomic factors noted above, outside of higher compensation-related costs. In the first half of 2024, we accelerated certain of our capital expenditures related to gaming terminals and related components to manage our supply chain. 

We intend to continue to monitor macroeconomic conditions closely and may determine to take certain financial or operational actions in response to such conditions to the extent our business begins to be adversely impacted. 

Components of Performance

Net revenues

Net gaming. Net gaming revenue represents net cash received from gaming activities, which is the difference between gaming wins and losses. Net gaming revenue includes the amounts earned by our location partners and is recognized at the time of gaming play.

Amusement. Amusement revenue represents amounts collected from amusement devices operated at various location partners and is recognized at the point the amusement device is used.

Manufacturing. Manufacturing revenue represents sales of gaming terminals and software as well as other ancillary equipment.

ATM fees and other. ATM fees and other consist of fees charged for the withdrawal of funds from our redemption devices and stand-alone ATMs and is recognized at the time of the ATM transaction. Beginning in the first quarter of 2025, revenues from our casino & racing operations