Gaming and gambling content developer NetEnt has posted a 2.8 percent year-on-year decline in revenues for the first quarter. The dip in the revenues has been attributed to the slowdown in the Nordic markets primarily in Sweden.
The company has said that the dampened revenues from the Swedish market have taken a toll on the overall revenues for the first quarter.
While the company has been focussing on the US markets and has managed to secure a bunch of deals including licenses to enter the market in Pennsylvania and securing a permanent license in New Jersey, the performance for the first quarter is not as impressive as expected.
The Q1 revenues dropped to SEK 418m (£344.1m) from SEK 430m (£354m) for the same period the previous year. Company’s EBITDA for the first quarter increased from SEK 182m (£149.8m) to SEK 196m (£161.3m). The operating profits tanked from SEK 134m (£110.3m) to SEK 126m (£103.7m) dropping 5.9 percent year on year.
Therese Hillman, group CEO of NetEnt said: “In the first quarter, NetEnt’s total revenues decreased by 2.8 percent (-7 percent in euro) compared to the corresponding period in the previous year.
“The Nordic countries accounted for almost the entire slowdown, mainly due to lower volumes in Sweden as the new regulation was introduced at the start of the year. The new rules have impacted our customers and players to the extent that we had not foreseen, and the combined effect of fewer players and lower average revenue per user has led to a weak start on the newly regulated market.”
Explaining the company’s plans and progress in the US markets Hillman said: “In the US, we see continuing strong growth in New Jersey, a market that still has much lower online penetration than the Nordic markets and hence the potential to grow for many years to come. For Pennsylvania, the latest estimate is that the market will open in July.”