Online casino software developer, NetEnt, has a new CEO in the form of Therese Hillman. Hillman has recently insisted that the company is taking action after a slowdown in the UK market contributed to its slow revenue growth in the second quarter of 2018.
In a recent trading update in July, NetEnt reported a six per cent rise in revenue year-on-year to just over SEK430 million. However, that is a 0.8 per cent decline. Even though earnings before tax did grow by 1.2 per cent, the company’s share price on the Stockholm Nasdaq dropped around 17 per cent following the release of the Q2 results.
Hillman has said she could not be too confided that the revenue outlook would significantly improve in the next quarter.
NetEnt is now said to be taking action where they feel they are not doing enough. They have noted a slowdown in the UK, which is a challenging market at the best of times. In spite of the emergence of new players in the UK market, NetEnt’s share in the country is just 10%.
Hillman reportedly said that she is confident that the company’s portfolio of games will be better in the second half of the year. The brand is focusing on its live casino growth, too, along with more growth initiatives.
Looking towards the future, NetEnt plans to strengthen its customer offering, freeing up resources for new projects and cutting lead times. The company is flourishing in southern Europe and experiencing increased competition in those markets that are maturing.
The brand is said to continue reviewing its cost structure so as to improve scalability across the board and is already noting a lower pace of cost growth. According to Hillman, this year’s FIFA World Cup had a positive impact on the company’s performance.
Meanwhile, Regulus Partners have said that NetEnt’s slowdown mirrors two trends that may well be difficult to overcome.
In a note, it said that the company’s key Northern European markets continue to mature, making growth more difficult, especially for online casino operators and suppliers that already have a large market share.
Secondly, the rapid growth of mobile businesses has put a spanner in the supply-chains works. Today’s top online casino operators constantly seek out the best content from an array of sources, reducing the value of time in terms and increasing growth risk of clients.
Regulus Partners believe that these two pressures can put companies at a disadvantage.
But, we are confident that NetEnt will pull off growth in the second two quarters of 2018. We’ve become accustomed to them releasing top-of-the-range online slots based on a huge variety of themes to suit all kinds of players. They’ve also already created several millionaires this year, showing no signs of dwindling in popularity.
Whether you prefer to have a go at progressive pokies or fun-themed reels, NetEnt is sure to have games to whet your appetite and keep you playing.