IGT clocks first quarter revenue of $1.07 billion, raises full-year guidance

International Game Technology (IGT) has reported revenue of $1.07 billion for the first quarter of 2024, marking a marginal 1% increase from $1.06 billion in the year-ago period. The company has now increased its full-year revenue guidance after posting better-than-expected results.

Operating income of $256 million was in line with the prior year while operating income margin of 24% exceeded expectations by approximately 400 basis points. Excluding separation and divestiture costs, operating income increased 7% to a record $273 million and the margin expanded 150 basis points, the company said.

IGT said the growth was driven by strong Global Lottery expansion, but was partially offset by the timing of Gaming & Digital product sales.

Adjusted EBITDA was $443 million and Adjusted EBITDA margin was 41.5% during the quarter. Excluding separation and divestiture costs, Adjusted EBITDA was $461 million and the margin improved 80 basis points to 43.1%.

"Innovative game, hardware, and systems solutions drove better-than-expected Global Lottery and Gaming & Digital performance in the first quarter," said Vince Sadusky, CEO of IGT. "As a result, we are upgrading our full-year 2024 revenue and profit goals, which reflect broad-based momentum across key performance indicators in the balance of the year."

Global Lottery revenue of $661 million increased 6% year-over-year on significantly higher product sales, driven by the delivery of GameTouch 28 self-service terminals in Canada and software upgrades in Singapore and Germany, and continued same-store sales strength in Italy, as per the company.

Gaming & Digital revenue of $406 million, compared to $436 million in the prior year, reflects lower product sales due to fewer terminal unit shipments in the current year and elevated intellectual property and software licenses in the prior year. This was partially offset by higher service revenue driven by growth in the global installed base, which more than offset lower yields, and a 10% increase in iGaming revenue.

Operating income from Global Lottery stood at $258 million, up 8% compared to $240 million in the prior year while Gaming & Digital recorded operating income of $81 million compared to $83 million from last year. The latter was the result of research and development process improvements and easing of supply chain costs being offset by lower revenue and additional investments in the business. 

The full-year revenue guidance has been raised to $4.4 billion, with an operating income margin of approximately 21%, or approximately 24% when excluding separation and divestiture costs.

"We delivered a record organic profit performance in the first quarter, if we exclude Separation & divestiture costs," said Max Chiara, CFO of IGT. "The company is operating from a position of strength with historically low net debt leverage, ample liquidity, and manageable near-term debt maturities."

Sadusky said the company continues making progress on separating Global Lottery from Gaming & Digital and preparing for the proposed combination with Everi Holdings. He also said neither IGT nor Everi had received any negative comments from customers about the deal. 

Everi will rebrand to International Game Technology Inc. and trade on the New York Stock Exchange under the ticker IGT. The combined business will be worth an estimated $6.20 billion and the transaction is expected to close in late 2024/early 2025.