Accel Entertainment: Q1 Record and a Chicago Catalyst Reset the Growth Narrative

Record revenue and adjusted EBITDA, TITO adoption ramping, and a hyperlocal model poised for the Chicago VGT market open.

ACEL · Earnings Call · 2026-05-05

Record Q1: Growth Across the Route

Accel Entertainment delivered a strong start to 2026, with Q1 revenue up 9% year over year to a record $352 million and adjusted EBITDA up 9% to $54 million. “Accel Entertainment, Inc. delivered a strong start to 2026, the company’s highest-ever Q1 adjusted EBITDA result.” — Andrew Harry Rubenstein, Chief Executive Officer · 2026-05-05 The growth was broad-based, with Illinois (the core market) up 6% excluding Fairmont Park, and developing markets accelerating: Nebraska revenue surged 57%, Georgia 43%, and Nevada expanded 27% in locations and 28% in terminals. hold per day improved 9% in Illinois and 5% in Montana, reflecting the ongoing route optimization strategy.

The Chicago Catalyst: A Multi-Year Opportunity

Management is positioning Chicago as one of the most compelling near-term growth opportunities in the company's history. “We are in the process of signing up Chicago locations and are well positioned to mobilize when the Illinois Gaming Board begins issuing approvals.” — Operator · 2026-05-05 The first locations are expected to go live in late 2026 or 2027. This is not a new theme—Andy Rubenstein noted in the prior call that the IGB had begun accepting applications—but the concrete progress and timeline are fresh. The market is expected to have higher average play per machine than the rest of the portfolio, given population density, even if location square footage is constrained. Chicago locations are now a tangible pipeline rather than a distant possibility.

TITO and the Shift to a Hospitality Model

Ticket-in, ticket-out (TITO) rollout in Illinois has reached full terminal enablement, and the adoption rate is already 13%, with management indicating potential to reach 20% as players become accustomed to the convenience. “What we are seeing so far in adoption is around 13%, and it has not fully tapered off yet.” — Brett Summerer, Chief Financial Officer · 2026-05-05 This is a new operational data point that sets expectations for cash handling cost reductions over time. More importantly, Mark Phelan framed a strategic pivot:

We increasingly view it less as a logistics business and more as a gaming and hospitality business.
Mark T. Phelan, President and Chief Operating Officer · 2026-05-05

This is a deliberate shift in how the company allocates capital and invests in content, exclusive games, and customer experience—evidenced by the launch of live dealer table games at Fairmont Park and increased purses to attract better horse racing fields.

Financial Strength and a Disciplined Capital Return

Accel's balance sheet remains strong, with net leverage at 1.4x and a fully undrawn revolving credit facility. Free cash flow conversion was 38% in Q1, and management highlighted free cash flow as a key priority going forward. “We expect free cash flow to continue to grow and view this as a key priority.” — Brett Summerer, Chief Financial Officer · 2026-05-05 The company repurchased 1.1 million shares for $12 million year-to-date. Revenue trend shows consistent growth, while free cash flow has been volatile but is now being emphasized. The new interest rate collar (cap 4%, floor 2.92%) provides protection against rate risk.

Macro Resilience and the Hyperlocal Tailwind

Management again underscored the hyperlocal nature of the business, arguing that trade-down behavior—players staying closer to home rather than traveling to regional casinos—is a stabilizing tailwind amid tariffs and inflation. The discussion of gas prices was notable: Andy Rubenstein said they have not seen a material impact, and in fact the model may benefit as players reduce travel. This theme has appeared in prior calls, but the current quarter's explicit dismissal of gas price sensitivity reinforces the resilience story. Overall, Accel's Q1 results confirm a steady growth trajectory with a powerful near-term catalyst in Chicago. The company's shift from a pure logistics operator to a hospitality-driven gaming platform, combined with disciplined capital returns and improving cash generation, makes it a name to watch as the Illinois market finally opens.