Bet On It: Las Vegas Recovery Potentially Underway As Restrictions Loosen

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Shares of Gan Limited (GAN) were down as much as 7% on Friday after the company reported Q4 results that missed analyst expectations on Thursday night. The company reported losses per share of (26c), versus analyst's consensus estimate of (6c). The company's Q4 revenue of $8.9M came in nearly $2M behind Street consensus.

Dermot Smurfit, CEO of Gan stated: "2020 was a highly successful, foundation-building year for GAN. We expanded our top-line, doubled our new client launches, signed numerous new customers that we believe will support stable and growing recurring revenue, and rounded out our product portfolio through multiple new content partnerships and the critical acquisition of Coolbet. Our annual revenue increased 17% in 2020, but the key recurring components of that, our U.S. RMiG and Simulated offerings, saw revenue growth of 92% and 77%, respectively. We also invested in our infrastructure and have fully converted to U.S. GAAP during the fourth quarter, which completed our journey to becoming a public company listed and based in the U.S. Most importantly, we filled a significant need in our product offering through Coolbet's best-in-class sportsbook engine, which positions Gan as a full-service B2B solution for real money gaming in the U.S. and as a vertically integrated B2C player in select international markets."

On the other hand, GAN provided EPS and revenue guidance for Q1, and FY21 well above the Street. CFO Karen Flores cited the CoolBet acquisition, among other factors, for the optimistic projections. Flores said: "Our first quarter has started off very strong across all of our business lines. This should support strong growth in 2021 and we expect to almost treble our top-line performance, inclusive of strong organic growth and Coolbet's contribution. We also expect to drive operating leverage that will yield stronger profitability results year-over-year. We remain confident that we will continue to onboard new customers as well as deepen our relationship with our existing customers, and we look forward to the launch of new states in 2021 to further support our growth trajectory. In the meantime, we are acutely focused on the integration of Coolbet to round out our B2B offering. We maintain a strong financial position and have a differentiated IP portfolio and management team that will continue to support and drive our multiprong growth strategy."

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