Ainsworth Game Technology posted a 10% revenue increase in FY25 to $291 million, driven by strong Asia Pacific growth, while North American challenges weigh on H1 2026 outlook.
- FY25 revenue up 10% to $291 million
- Asia Pacific revenue surges 52% on A-Star Raptor™ launch
- North America faces regulatory and competitive pressures
- H1 2026 revenue expected to decline 24%
- Heavy R&D investment continues with dividends suspended
FY25 Revenue Growth Masks Underlying Challenges
Ainsworth Game Technology Ltd (ASX:AGI) reported a 10% increase in revenue to $290.8 million for the financial year ended 31 December 2025, buoyed by a 52% surge in Asia Pacific sales following the launch of its A-Star Raptor™ cabinet. Underlying EBITDA held steady at $48 million, though margins compressed to 16.5% from 18.3% the prior year, reflecting gross margin pressures and tariff impacts.
Despite the top-line growth, the company’s statutory results were weighed down by significant one-off charges, including a $45.2 million impairment and $8.3 million in transaction costs related to a terminated scheme of arrangement and takeover offers. Currency translation losses of $12 million further contributed to a reported loss before tax of $44.4 million, a sharp reversal from the prior year’s $33.9 million profit.
North America Remains Largest Market but Faces Headwinds
North America accounted for more than half of group revenue at $151.3 million, a modest 3% increase on the prior period in constant currency terms. However, the region saw a decline in gaming operations units to 2,618 from 3,015, driven by regulatory changes in states like New Hampshire and Louisiana and a shift from lease to outright sales in Mexico and Argentina.
Participation and lease revenues fell slightly to $38.5 million, reflecting fewer units under operation and a lower average fee per day. The company noted increased competition and adverse economic conditions as primary factors behind softer sales and recurring revenue growth. This challenging environment is expected to continue into 2026, with the company forecasting a 24% revenue decline in H1 2026 to approximately $116 million, largely due to North American softness.
Asia Pacific and Latin America Show Resilience
The Asia Pacific region delivered a standout performance, with revenue climbing to $65 million, driven by strong demand for the A-Star Raptor™ dual screen cabinet and new game releases such as Year of the Snake™ and Nugget Hunter™. Segment profit margins improved significantly to 21%, leveraging higher volumes and fixed overhead absorption.
Latin America and Europe revenue rose 4% to $69.3 million, despite ongoing import restrictions in Mexico and economic pressures in Argentina. The region experienced a 10% decline in gaming operations units, offset by increased sales of higher-priced A-Star Raptor™ cabinets and a growing share of recurring Historical Horse Racing connection fees.
R&D Investment and Liquidity Priorities
Ainsworth continues to pour resources into research and development, with R&D expenses representing 17% of revenue in FY25 and expected to rise to 22% in H1 2026. The company emphasised that R&D is critical not only for product innovation but also to meet stringent regulatory requirements across its markets.
To support ongoing operations and strategic initiatives, Ainsworth renegotiated its credit facility in June 2025, increasing it to US$75 million from US$50 million. The company ended FY25 with net debt of $11.8 million, reversing from a net cash position the previous year. Dividends remain suspended to preserve liquidity and fund product development, a stance the board reiterated as necessary given the current market and investment climate.
Governance and Board Changes
At the AGM, shareholders re-elected directors Graeme John Campbell and Dr Haig Edwin Asenbauer and elected new director Birgit Hermine Wimmer. However, the election of Samuel Lawrence Levy was narrowly rejected amid ongoing governance debates linked to recent takeover activity.
The meeting also approved amendments to the company’s constitution, including the renewal of proportional takeover provisions for three years, a move that aligns with the recent corporate activity involving the company’s majority shareholder Novomatic AG and takeover offers by Mr Kjerulf Ainsworth at a premium price of $1.30 per share. These developments unfold against the backdrop of a complex shareholder landscape and strategic positioning efforts by major stakeholders.
These governance updates follow the company’s recent CEO appointment and incentive plan and the underlying profit and impairment disclosures earlier this year, highlighting a period of transition and strategic recalibration for Ainsworth.
Bottom Line?
Ainsworth’s strong FY25 top line belies margin pressures and North American challenges, making its heavy R&D spend and liquidity management critical to watch as H1 2026 unfolds.
Questions in the middle?
- Will North American regulatory and competitive pressures ease to support a revenue rebound?
- How quickly can Ainsworth’s R&D investments translate into improved product margins and market share?
- What impact will ongoing governance shifts and shareholder activism have on strategic direction?