Golden Entertainment (NASDAQ:GDEN) Misses Q1 Sales Targets

GDEN Cover Image — Golden Entertainment (NASDAQ:GDEN) Misses Q1 Sales Targets

Adam Hejl

Thu, May 8, 2025, 4:25 PM 4 min read

Revenue: $160.8 million vs analyst estimates of $164.2 million (7.6% year-on-year decline, 2.1% miss)
EPS (GAAP): $0.09 vs analyst expectations of $0.12 (27.5% miss)
Adjusted EBITDA: $37.58 million vs analyst estimates of $37.17 million (23.4% margin, 1.1% beat)
Operating Margin: 6.9%, down from 46% in the same quarter last year
Market Capitalization: $685.7 million

Blake Sartini, Chairman and Chief Executive Officer of Golden Entertainment, commented, “Our focus on customer experience and operational efficiencies allowed us to generate strong financial performance despite uncertain macroeconomic conditions. Our business remains resilient and we intend to continue to opportunistically repurchase our common stock under our current buyback authorization.”

Company Overview

Founded in 2001, Golden Entertainment (NASDAQ:GDEN) is a gaming company operating casinos, taverns, and distributed gaming platforms.

Sales Growth

A company’s long-term sales performance is one signal of its overall quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Golden Entertainment’s demand was weak over the last five years as its sales fell at a 7% annual rate. This wasn’t a great result and is a poor baseline for our analysis.

We at StockStory place the most emphasis on long-term growth, but within consumer discretionary, a stretched historical view may miss a company riding a successful new product or trend. Golden Entertainment’s recent performance shows its demand remained suppressed as its revenue has declined by 23.8% annually over the last two years. Note that COVID hurt Golden Entertainment’s business in 2020 and part of 2021, and it bounced back in a big way thereafter.

Golden Entertainment Year-On-Year Revenue Growth

This quarter, Golden Entertainment missed Wall Street’s estimates and reported a rather uninspiring 7.6% year-on-year revenue decline, generating $160.8 million of revenue.

Looking ahead, sell-side analysts expect revenue to grow 3.4% over the next 12 months. While this projection implies its newer products and services will spur better top-line performance, it is still below the sector average.

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Operating Margin

Operating margin is a key measure of profitability. Think of it as net income - the bottom line - excluding the impact of taxes and interest on debt, which are less connected to business fundamentals.

Golden Entertainment’s operating margin has been trending down over the last 12 months, but it still averaged 30.6% over the last two years, elite for a consumer discretionary business. This shows it’s an well-run company with an efficient cost structure.

Golden Entertainment Trailing 12-Month Operating Margin (GAAP)

This quarter, Golden Entertainment generated an operating profit margin of 6.9%, down 39.2 percentage points year on year. This contraction shows it was less efficient because its expenses increased relative to its revenue.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Golden Entertainment’s full-year EPS flipped from negative to positive over the last five years. This is encouraging and shows it’s at a critical moment in its life.

Golden Entertainment Trailing 12-Month EPS (GAAP)

In Q1, Golden Entertainment reported EPS at $0.09, down from $1.37 in the same quarter last year. This print missed analysts’ estimates, but we care more about long-term EPS growth than short-term movements. Over the next 12 months, Wall Street expects Golden Entertainment’s full-year EPS of $0.39 to grow 110%.

Key Takeaways from Golden Entertainment’s Q1 Results

We struggled to find many positives in these results. Its EPS missed significantly and its revenue fell short of Wall Street’s estimates. Overall, this was a weaker quarter. The stock remained flat at $25.90 immediately after reporting.

Golden Entertainment’s latest earnings report disappointed. One quarter doesn’t define a company’s quality, so let’s explore whether the stock is a buy at the current price. What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here, it’s free.

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