IGT posts $1.06B revenue in Q3, tightens full-year guidance to upper end of forecast

International Game Technology (IGT) has reported its financial results for the third quarter of the year, driven by strong key performance indicators across its business segments. IGT's consolidated revenue for Q3 2023 reached $1.06 billion, in line with the previous year, up by a slight 0.9%.

IGT has now tightened its full-year guidance to the upper end of previous forecasts based on its Q3 results. For the full year, IGT now expects revenue to amount to $4.30 billion; while operating profit is forecast to reach 23% for the 12-month period.

IGT also reported an operating income of $239 million, representing a 13% increase from the prior year; led by double-digit growth in Global Gaming and PlayDigital. The operating income margin also expanded by 250 basis points to 22%, a record level for a third-quarter period. Diluted earnings per share came at $0.46.

Vince Sadusky, CEO of IGT, stated: "The strength of our leadership positions across Global Lottery, Global Gaming, and PlayDigital is evident in our third quarter and year-to-date results."

"Excellent momentum in key performance indicators is driving revenue growth and even stronger profit expansion. With a compelling pipeline of innovative products and solutions showcased at recent tradeshows, I am confident we can achieve our near and medium-term goals as we focus on unlocking the intrinsic value of IGT's market-leading assets," he noted.

Vince Sadusky, CEO of IGT

Breaking down the revenue by segment, IGT's Global Lottery segment generated $601 million, showing a 4% decline year-over-year. However, after considering the Italy commercial services sale, the segment's revenue increased by 5% fueled by strong same-store sales in Italy, with continued strength in both instant tickets and draw games, and elevated U.S. multi-state jackpot activity.

Global Gaming, another key segment for IGT, saw remarkable growth, with revenue reaching $407 million, up 8% increase from $379 million in the prior year, primarily driven by growth in the installed base and higher system and software sales.

PlayDigital, IGT's digital gaming division, saw revenue of $55 million, in line with the prior year, as growth in iCasino was offset by the impact of exiting certain legacy iSoftBet jurisdictions and unusually high sports betting hold levels in the prior year

Adjusted EBITDA of $433 million rose 8% from $402 million in the prior-year period, partially offset by lower transaction expenses associated with the sale of Italy commercial services in the prior year. Meanwhile, Adjusted EBITDA margin increased to 41% from 38% in the prior year, led by margin expansion in Global Gaming and PlayDigital.

Max Chiara, CFO of IGT, commented: "We are pleased with the financial results we delivered in the third quarter, including top-line growth, margin expansion, and strong cash flow generation."

"Our financial position is solid with net debt leverage at a historical low point and already comfortably within our long-term target range, which coupled with no meaningful near-term debt maturities and access to significant liquidity, greatly enhances our balance sheet and creates additional financial flexibility," he added.

Max Chiara, CFO of IGT

In terms of operational achievements, during Q3, IGT secured a 7-year lottery contract extension as a primary technology provider to the California Lottery through 2033, and 10-year contract extensions as a retail and iLottery systems partner to the Kentucky Lottery Corporation through July 2036.

The company's commitment to innovation was further strengthened with its deployment of an end-to-end cloud-based iLottery platform for Totalizator Sportowy in Poland. Moreover, the company launched its bespoke Caesars Cleopatra game for Caesars Palace Online Casino.

During the quarter, the business also debuted its PeakBarTop cabinet with sports betting, as well as expanded its PlaySports technology footprint, including IGT's trading advisory services, with deployments at Palace Casino Resort in Mississippi and St. Croix Casino in Wisconsin.

Turning to the year-to-date performance, IGT posted $3.12 billion in revenue in the nine months to 30 September, 1.5% ahead of the same point last year. Net profit attributable to IGT reached $164 million, down 51.6%; while Adjusted EBITDA was 6.4% higher at $1.33 billion.

See IGT's full Q3 2023 report here.