Casino Communications

Q&A with Hector Fernandez

Chief Executive Officer, Aristocrat Gaming

A recent restructuring of divisions of Aristocrat Technologies established three sections devoted to iGaming, social gaming and land-based gaming. Hector Fernandez was elevated to CEO of the gaming division at that time. He joined Aristocrat in 2018 as CFO for the Americas and EMEA after a long career in finance. With Aristocrat producing many of the most popular casino games, Fernandez could just steer the ship, but he understands that to stay on top, the company must continue to lead with innovation and compassion. He spoke with GGB Publisher Roger Gros at the company’s Las Vegas headquarters in May. To hear and view a full podcast of this interview, visit GGBMagazine.com.

You’ve been president and now CEO of Aristocrat Gaming for about two years now. What’s the most important thing you learned during that time here at Aristocrat?

Hector Fernandez: It’s all about our people. At the end of the day, every single thing we’ve accomplished over the last two years is because of our people and their resilience. Their commitment to the business. Our commitment back to them. And overall, quite frankly, it’s about picking the right people, setting the right expectations, setting the right rewards system, and setting the right accountability metrics.

At your last earnings call, Aristocrat Gaming produced a 41 percent increase in profits, and more impressively on your part, it was a 61 percent increase in the North American market, which, of course, you’re responsible for. How did you do that?

We talked about this through the pandemic— this concept that companies that continue to invest through economic shocks can actually leapfrog the competitors. And it’s one of the things that we, as a business, understood was important. We were fortunate that we had a strong balance sheet, and we just continued our D&D investment.

If you look at the number of games that we sold for the half, it was an all-time record half for us. It really is a byproduct of the choices we’ve made through the pandemic, starting with being there for our customers, through our Aristocrat Assist program. As we saw the world start coming back, we realized that there were going to be some supply chain challenges because those companies had kind of hunkered down, not spending as much money. So we saw that early on, and one of the things that we did is we were aggressive and took long positions of inventory. If you look at our results for the half, the reason we were able to fulfill all that demand, and the reason we had a very profitable business is because of our forward investment into inventory, that proved to be the right decision.

You’ve got a financial background. How does that help you manage the successful bottom line but also the creative side?

Having a finance background allows me to worry a lot less about the numbers on a day-to-day basis. I think when folks come up through different paths without a finance background, that’s where they have to spend the vast majority of their time because it’s a very hard skillset, and it requires a lot of experience. What really helped me is I’ve been able to spend more of my time on our people and our customers, and far less time on the P&L, if you will. Because within a 15minute meeting, I can have a grasp of what’s happening, and what the future kind of looks like, based on trends, without having to spend hours of discussions.

Aristocrat has had a lot of breakthrough products over the last few years, the Buffalo series and Lightning Link, just to name the two that are most copied in the industry. How important are these products to the success of the company?

They are the backbone of what we’ve been able to build. If you think about Aristocrat seven or 10 years ago, if you think about our entry into the U.S., we were not anywhere in the top five.

We were able to take some of the lessons from the Australian market, which is where our roots are. A lot of the products that have been successful there, a lot of the math that has been successful there, some of the volatility from a game performance standpoint, we were able to bring it to this market, and over time, really accelerate the growth. So, today we’re the undeniable No. 1 player globally, not just in the lease market, but also now in the for-sale market. And it’s really behind these investments and some of these proprietary brands that we have built over time.

One of the new products we launched almost a year ago was Buffalo Link. And Buffalo Link is essentially Buffalo, with Lightning Link math behind it, and we believed it would be a fantastic combination. It was the most-anticipated game. It was the fastest-ramping game we’ve ever put out there. And we continue to have installs out in the marketplace. And so that’s been a very important part of our portfolio, this diversification element.

We were at the groundbreaking of your new manufacturing facility in Henderson, Nevada in April. There were over 100 employees there that will work in that building and they were clearly excited. How gratifying is that?

Honestly, every day I wake up—particularly in this new role—there’s over 4,000 families that depend on the decisions that our team makes and that’s the first thing I think about. And I think that people can feel that. People can feel that commitment for their personal well-being, their personal progression—the ability to create wealth over a lifetime of work. And they give us that love back. This is what I love about coming to the office—that gives me a ton of energy. It makes it so we want to win every day. And we want to win the right way.