Amaya GamingAmaya Gaming has recently report a highly profitable first quarter that's gone beyond the expectations of industry experts' estimations. This despite the fact that last year, meaning 2016, spelled disastrous results for the software provider. It just goes to show that bad PR doesn't necessarily equal bad profits. Amaya's many gaming products still did well even in the face of a bad reputation, which is still recovering from the significant blow it took the previous year.

As our readers probably know, Amaya Gaming is a Canadian born and bred gaming developer, and it has a big stake in the iGaming industry in Canada. It's for this reason that it's advisable that Canadian gaming enthusiasts pay some attention to what's going on with Amaya's finances, because it contributes towards the overall gambling industry's state in Canada.

Recent news regarding legislation in Australia has made us wonder if the company's continued success and high profits throughout 2016 and this year will last into the second quarter. Let's take a closer look at the situation right now.


There were two scandals surrounding Amaya last year, the ripple-effect of which is still happening right now in terms of publicity. First, then CEO David Baazov was accused of insider trading and other illegal activities early in 2016. He then had to resign from his position, and is currently awaiting trial as we speak. A merger worth around 4.5 billion that was planned with William Hill Casino subsequently fell through because of Baazov's accusations. Another CEO has taken his place, Rafi Ashkenazi, who is intent on rehauling Amaya's entire image – including a name change to ‘The Stars Group Inc'. The name-change reflects a move away from the Amaya associated with Baazov, and towards the company's largest and most profitable offspring – PokerStars.

The other major scandal concerning Amaya is a court sentence that was actually decided in December, 2015 but which still trails behind the company because they are contesting it. Amaya was accused of operating in Kentucky, where online gambling for real money is illegal according to certain standards. The judge presiding over the case ruled in favor of Kentucky, saddling the company with a massive $800 million fine.


amaya gaming profits
Despite the rocky events of 2016, Amaya started off 2017 with a bang. The company reported an 18.5% increase in profit due to a surge in customers (three million, to be precise). Their number of active customers also rose by 5%, which is quite an achievement in the competitive conditions of the iGaming industry. Amaya's net income also rose to $65.8 million in this first quarter, a while 10 million more than the previous quarter when Amaya stated it had made record-breaking profits.

Overall, Amaya's revenue went up by 10% to $317.3 million, even though analysts had expected a revenue of $316.7 million – just shy of the actual amount by less than a million. Following the success of the First Quarter, the company's main headquarters are relocating to Toronto from Montreal in the hopes of acquiring better control and management over their operations. We suspect it's another move to distance the company from its hardly reputable past. Either way, Canada's software provider will be going through the winds of change this year.

Will it last?

We're hoping that Amaya keeps on its upwards trajectory, and manages to shake off the illegal taint of its former CEO. But, as always, you never really know what the future is going to throw at you.

We're currently waiting with bated breath for the enactment of the Interactive Gambling Amendment Bill in Australia. Australia has been a major market for PokerStars and for online poker in general. However, ever since the bill was approved in 2016, PokerStars has been slowly detracting itself from the market due to the less than hospitable regulatory conditions the bill brings with it. PokerStars already stopped sponsoring major poker tournaments earlier this year in anticipation of eventually closing its Australian branch. Who knows what the financial ramifications of this are going to be on ‘The Stars Group'. Aussies are known for gambling at very high rates, they generate a market worth $18 billion per year. Amaya is going to be missing out on a chunk of that money because of the new bill.

Still, we think the reports of the First Quarter bode extremely well for the software provider. It's breaking into the U.S market again now that some time has passed since it was shamefully banished (not to mention, the intensive lobbying that must have gone on). The U.S market is not only larger, but it's also mostly untapped. If the gambling industry plays its cards right, and gets the right people on board, gambling regulations will loosen enough to make the U.S hospitable to gambling companies. Very much unlike the Australian market, which has reached its saturation point in terms of market profitability and reach, the U.S is a sleeping goldmine. If so – Amaya definitely won't be sweating the loss of the Australian market. It might even push it further towards investing in the U.S and Canada, which works out just fine for us.

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