New York banking giant JP Morgan has released its Annual Slot Market Survey, providing industry with professional analysis and insights into the evolving EGM sector.
JP Morgan conducts the survey each year and analyses the results. The process tracks multiple key benchmarks, notably annual capex spend on machines, conversions, management perception of manufacturers, and the main issues of concern in the sector.
This year the survey is presented in four main categories:
- Slot (poker machine) market trends
- Competitor landscape
- Aristocrat-specific analysis and takeaways
- Light & Wonder-specific analysis and takeaways
Key findings in the 2023 report conclude that while Aristocrat remains the clear industry leader, the outlook for Light and Wonder looks positive; replacement spend is to increase, but at a reduced pace to 2022; player expenditure is down, although the decline appears to be weighted to larger venues.
Aristocrat remain dominant
The company recorded clear leads across all categories, including 12-month performance, floor share, new floor allocation, and linked jackpot performance.
However, 90 per cent of respondents (representing ~96 per cent of surveyed machines) saw an improvement in Light and Wonder’s game library over the last 12 months, and 77 per cent intend to increase their allocation in the coming year. The survey found that “when weighted by slot machines represented, Light and Wonder appears to be gaining more floor share than Aristocrat at present”.
Replacement and conversion cycle
The proportion of venues intending to increase spend on replacement machines fell to 52 per cent this year from 71 per cent in 2022. This is the lowest figure since 2017 and appears to be at least in part due to a small growth in respondents expecting growth in conversion spend.
Cabinet inflation
The percentage of participants expecting machine prices to increase at least two per cent in the coming year stayed steady, at 87 per cent (versus 88 in 2022).
Per Player Spend
Conversely, in the wake of the rising cost of living, per customer expenditure has fallen and operator expectations have followed. This year only 39 per cent of respondents estimate an increase in player expenditure, while 48 per cent estimate a decrease.
Key Concerns
The largest concern for survey respondents heading into 2024 was the potential for changes to mandatory carded play. After this, concerns were fairly evenly split on the topics of changes to venue hours, slower spin rates, and regulations on machine load-up limits.
