In June, Evolution’s live dealer gameshow Crazy Time hit a payout so huge that it all but wrecked the company’s H1 2024 profitability. The top prizes for casino games can be life-changing for players, and the need to pay out a jackpot sometimes shows up in a smaller operator’s state-level revenue reports. However, a prize so big that it warrants a mention by the CEO on an earnings report is a rarity.
Despite strong revenue growth, Evolution’s record-setting online casino payout of €34.5 million ($37.4 million) meant lower-than-expected profits and the need to explain the situation to investors.
Evolution’s latest financial filing shows the company generated over €508 million ($551 million) in Q2, a 15.3% year-over-year increase. Q1 was similar, so for the first half of 2024, the company generated just over €1 billion ($1.1 billion), up by 16% compared to 2023. However, profitability didn’t rise by the same amount. For Q2, it was up just 1.9%, while for H1, it was 4.5%.
In his filing comments, Evolution’s CEO Martin Carlesund described the results as “solid,” noting that they don’t fully reflect the company’s operational performance. He cited the record payout as one significant factor causing the company to show less growth than it might have otherwise.
To put those numbers in context, Evolution’s increase in gross revenue from Q2 2023 to Q2 2024 was roughly €67 million. The Crazy Time jackpot payout was roughly half of that, although how much of that came directly from Evolution’s pockets depends on the terms of its deals with operators. Meanwhile, in the same quarter, Evolution increased its operating expenses by 24%, in keeping with the revenue it expected to be making. Having lost a big chunk of that expected additional revenue to the jackpot cut its operating profits substantially. Increased taxes further hurt the bottom line.
How Does Crazy Time Produce Such Massive Payouts?
It’s worth noting that the €34.5 million in prize money didn’t go to a single player. Rather, it was split between 4,988 participants who had bet on the winning segment of the Crazy Time wheel.
Crazy Time is Evolution’s most popular live dealer game internationally. It features a money wheel with four bonuses: Cash Hunt, Pachinko, Coin Flip, and Crazy Time. In addition, the Top Slot feature can multiply certain payouts. What happened in June was that a 50x multiplier was applied to the Pachinko bonus round, which produced a base 200x payout. Compounding that with the Top Slot multiplier resulted in a 10,000x payout for everyone who’d selected Pachinko for their bet.
The fact that all players share the same game result makes game shows like Crazy Time a risk for Evolution. At the same time, it’s those shared fortunes that create the community spirit that draws players to the game, just like a “hot hand” at the craps table can bring energy to a retail casino.
Due to its international success, Evolution decided to bring Crazy Time to US online casinos. The game show made its US debut in New Jersey in December 2023. As it’s one of the more established and competitive markets, New Jersey is often the first destination for Evolution and other content providers. Delaware, which now streams games from New Jersey studios, could get Crazy Time soon, too.
Evolution followed New Jersey with a Crazy Time launch in Pennsylvania and West Virginia in early June. Michigan is the last of the “big three” iGaming states to receive the game. Live dealer games in Michigan must be streamed from in state, so bringing it there will require a new studio.
New Releases Are Key for Evolution’s US Growth
The expansion of Crazy Time and other games could be a key to Evolution’s growth in the US. The latest financial filing shows that revenue growth in North America (US and Canada) was only 8.5%, just over half the global rate. While it’s an improvement over previous quarters, the company continues to struggle to keep up with the market.
A primary reason is that unlike in Europe, US states (except Delaware and West Virginia) require Evolution to stream its games within their borders. That means the company must build new studios and hire more people to introduce new games, which takes time and resources.
Evolution is working on that. Recently, it was revealed that the company is looking to build a new studio building in New Jersey. When it opens in 2026, it could employ up to 2,000 people. In addition, Evolution’s North American CEO, Jacob Claesson, expects to hire about 1,000 people this year to meet demand.
In the meantime, the company has introduced several games to boost revenue. That includes live dealer video poker in Pennsylvania and Spanish-speaking live dealer table games in New Jersey. Evolution also recently acquired Livespins, a company making a “bet behind” slots streaming product expressly aimed at the US market, pending regulatory approval.
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