For arcade operators, the decision between leasing and outright purchasing machines is a fundamental financial strategic choice that impacts cash flow, profitability, and long-term business viability. Each model presents a distinct set of advantages and challenges.

Ownership involves a significant upfront capital expenditure. Operators must purchase the cabinet, which can represent a substantial portion of their startup or expansion budget. The primary benefit is that once paid for, the machine generates pure profit for its entire operational life. The operator also has complete control over the machine's placement, maintenance, and eventual sale. However, ownership carries the risks of technological obsolescence and major repair costs. If a game underperforms, the operator is saddled with a costly asset that is difficult to move.

Leasing, or participating in a revenue-share program, offers a low-barrier entry. Operators avoid the large initial investment, preserving capital for other expenses like marketing or location fees. The leasing company typically handles all maintenance and repairs, reducing downtime and unexpected costs. This model also allows for greater flexibility; operators can easily rotate games to keep the offerings fresh and adapt to player preferences. The major drawback is the long-term cost. Lease payments or revenue shares (often a 50/50 split) continually cut into profits, meaning a popular game may cost more over time than if it had been purchased outright.

The optimal choice often depends on the operator's financial health and business stage. New or small-scale operators may prefer leasing to mitigate risk and conserve cash. Established arcades with strong capital might favor ownership for higher lifetime returns on hit games. A hybrid approach is common: owning core, reliable money-makers while leasing new or experimental titles to test player demand without committing to a full purchase. Ultimately, a careful analysis of cash flow projections, total cost of ownership, and market trends is essential for making the most profitable decision.