Gaming ‘one of most important’ markets for Crane NXT payment hardware: CEO

The gaming sector is “one of the most important” end markets for Crane NXT Co’s payment hardware business, and one in which the company has a “very significant market share”, says group chief executive Aaron Saak. The CEO also said the introduction of new-design U.S. banknotes would generate a hardware and software upgrade cycle for equipment used to process and authenticate cash, including in the gaming sector. Mr Saak made the comments during a recent fireside chat at the Jefferies Global Industrials Conference. He appeared alongside Crane NXT chief financial officer, Christina Cristiano. Crane NXT supplies payment and cash-processing technology to the casino industry via its Crane Payment Innovations (CPI) business. Discussing the group’s payment hardware operation, Mr Saak said: “Gaming is one of the most important end markets for us, in which we have a very significant market share.” Mr Saak described the payment hardware market as an “oligopoly”, with Crane NXT facing only “one or two natural competitors,” that were also “very mature” in terms of their business development. The CEO said the payment hardware business had margins that were “high relative to the rest” of Crane NXT segments, and generated free-cash-flow conversion of “over 100 percent”. The executive also pointed to a potential upgrade cycle linked to the introduction of new U.S. banknotes. “When the new US$20 bill comes out, there will be now a hardware upgrade cycle,” Mr Saak stated, referring to the need to upgrade both hardware and software used to read and authenticate the redesigned currency. Crane NXT had previously highlighted its strong position in gaming payment hardware. During the company’s second-quarter earnings call, Mr Saak described the group as “by far the number one player in the world” in that market. The company’s latest investor presentation shows payment hardware accounting for approximately 25 percent of Crane NXT’s sales in the 12 months ended June 30, 2026. Group sales were about US$1.8 billion over the period, with an adjusted earnings before interest, taxation, depreciation, and amortisation (EBITDA) margin of approximately 24 percent. Crane NXT reported in August second-quarter net sales of US$493.2 million, up 22.0 percent from the prior-year period. Net income attributable to shareholders increased 42.2 percent year-on-year, to US$63.0 million. The firm also appointed Jason Lund last month as president of both the CPI business and the Detection and Traceability Technologies segment. The company is pursuing expansion in authentication and traceability technologies alongside its established currency and payment equipment businesses. Its most recent presentation reiterated a target of approximately US$2.5 billion in annual revenue by 2028, including contributions from potential future acquisitions. “One of the hallmarks of our company is our free cash flow and strong balance sheet,” Mr Saak noted. Regarding capital allocation, the CEO said the priority would be “to invest in organic growth,” with the company planning to spend “anywhere between 3 to 5 percent of sales to grow the top line”. Mr Saak said “a lot of that” investment would be allocated to expand the firm’s currency business, which he noted “has a backlog that is at an all-time high and a robust pipeline of opportunities”. Secondly, the company would continue pursuing merger and acquisition opportunities, whenever viable. “We’ve done three sizable deals for us over the first three years. We’ll have about a billion dollars of dry powder to deploy to continue to build the franchise,” the CEO added.