Accel Entertainment smashed records with $352 million in first-quarter revenue, up 9 percent from last year. Chief Operating Officer Mark Phelan urged investors to see the company not as a simple delivery service but as a player in gaming and hospitality. This fresh view promises better profits through top-notch experiences and strong ties with partners.
Accel Entertainment delivered its best quarter ever. Net revenue hit $351.6 million, a jump of 8.5 percent year over year. The company served 4,540 locations, up 3 percent, and ran 28,353 gaming terminals, up 4 percent.
Net income stood at $15 million, about the same as last year. Adjusted EBITDA climbed 9 percent to $54 million. Free cash flow rose to $20.2 million, up 8 percent.
A timing shift in expenses at Fairmount Park racetrack hurt results a bit. Without that, EBITDA would have topped estimates by $2 million.
Illinois drove most growth. Revenue there reached $252.8 million, up 8.3 percent and 72 percent of total sales.
| Metric | Q1 2026 | Q1 2025 | Change |
|---|---|---|---|
| Net Revenue | $351.6M | $323.9M | +8.5% |
| Adjusted EBITDA | $53.8M | $49.5M | +8.6% |
| Locations | 4,540 | 4,391 | +3.4% |
| Terminals | 28,353 | 27,180 | +4.3% |
Phelan Pushes Gaming Hospitality Over Logistics
Mark Phelan laid out a bold rethink during the May 5 earnings call. “We increasingly think of it less as a logistics business and more as a gaming and hospitality business,” he said. Logistics fights on cost and size alone. Gaming wins on fun, fresh games, close bonds, and unique perks, leading to fatter margins.
This shift shapes daily work. Accel focuses on player joy and partner wins. In Illinois, full rollout of ticket-in, ticket-out tech boosted play by 13 percent and growing. It cuts cash hassles and keeps folks coming back.
Phelan took over as president of U.S. gaming last year. He steps up to CEO on August 7, with founder Andy Rubenstein moving to chairman.
Illinois Leads but Chicago Beckons Big
Illinois remains Accel’s powerhouse. Revenue excluding Fairmount Park grew 6 percent on smarter routes and better daily holds of $902 per spot, up 9 percent.
Location count dipped 2.4 percent to 2,678 as the team cut weak links. Terminals fell 1.4 percent to 15,413. Still, hold per day soared to $962.
Chicago could change everything. The city eyes video gaming terminals after years of bans. Accel, with deep roots and 2,678 spots statewide, lines up to lead. First sites may open late this year or early 2027 as approvals roll in.
Fairmount Park added live table games like blackjack in April. It runs 57 racing days this year, with bigger purses to draw crowds.
New States Spark Revenue Fireworks
Accel spreads bets beyond Illinois. Nebraska revenue exploded 57 percent to $11.4 million on new spots and hot content. Georgia jumped 43 percent to $6.2 million, with 28 percent more locations.
Nevada grew 6 percent via buys like Dynasty Games and deals with Rebel stores. Louisiana rose 12 percent, chasing truck stop goldmines.
Montana slipped 1.2 percent to $40.6 million despite added spots. Proprietary games from Grand Vision help hold daily yields up 5 percent.
- Nebraska: +57% revenue, hold per day +57%
- Georgia: +43% revenue, locations +28%
- Locations total: 4,540 across 10 states
Gross margins ticked up to 31 percent. Capex guidance sits at $60-70 million for the year, mostly upkeep with quick payoffs.
Steady Cash Flow Backs Smart Moves
Accel ended Q1 with $274 million in cash and net debt of $306 million. Leverage stays low at 1.4 times EBITDA.
The firm bought back 1.1 million shares for $12 million. Total repurchases since 2021 top $195 million, with $151 million left.
No full-year guidance yet. But leaders eye organic wins, buys, and cash conversion. TITO perks build all year. Chicago adds upside without big risks.
Stock traded near $12 before the call. Analysts see room to climb on beats.
Accel proves local gaming thrives even in tough times. Players flock to nearby bars over big casinos. This setup shields from wild swings.
Owners love steady cash from terminals. It funds upgrades and draws crowds. For investors, fat free cash flow means buys or payouts ahead.
