International Game Technology (IGT) announced a decline in Q3 revenue and a shift to net losses as the company continues its transition toward a lottery-focused business model. This marks the first quarter that IGT’s Gaming and Digital divisions have been classified as discontinued operations, following the announcement of their sale to Apollo Global Management for $4.05 billion. The deal, set to close by Q3 2025, will position IGT as a streamlined lottery-only company.
Revenue for the third quarter fell 2.3% year-on-year to $587 million, driven in part by decreased U.S. multi-state jackpot activity. IGT posted a net loss of $46 million from continuing operations, a reversal from the $77 million profit reported in the same quarter last year.
IGT’s operating expenses rose by 8.9%, primarily due to a $38 million restructuring charge associated with ongoing transformational actions as part of its reorganization efforts. The company also faced $94 million in non-operating costs, with significant losses related to foreign exchange fluctuations.
Despite these pressures, CEO Vince Sadusky noted the transformation will allow IGT to become a “leaner, more focused” operation and added: “Our Q3 and year-to-date performance underscores the strength and resilience of our business model marked by our scale, attractive margin structure and strong cash generation.”
CFO Max Chiara also highlighted the impact of cost-saving initiatives: “The value of IGT is enhanced on a go-forward basis by a low pro forma leverage profile and by the launch of a cost optimization initiative as we look to right-size the organization while supporting long-term growth initiatives.”
Revenue from Italy rose 4.6%, while revenue from the U.S. and Canada fell by 7.2%. The rest of the world experienced a 2.6% decline in revenue. For the first nine months of 2024, revenue inched up 0.7% to $1.9 billion. Net profit for this period was $130 million, marking a 20.7% drop compared to last year.
Adjusted EBITDA for the quarter was $264 million, reflecting a margin of 44.9%. For the full year, IGT has forecast adjusted EBITDA to fall between $1.16 billion and $1.18 billion, down from $1.78 billion in 2023.
For Q4, IGT expects revenue in the range of $640 million to $690 million, with full-year revenue guidance set between $2.50 billion and $2.55 billion. The company aims to capitalize on growth in Italy and enhanced instant ticket sales in the U.S., while further implementing its OPtiMa 3.0 cost optimization initiative, targeting $40 million in annual savings by 2026.
In addition, IGT declared a quarterly dividend of $0.20 per share, underscoring its focus on shareholder returns. The company reported liquidity of $1.9 billion at the end of Q3, comprising $0.5 billion in cash and $1.4 billion in undrawn credit.
Original article: https://www.yogonet.com/international/noticias/2024/11/13/85174-igt-reports-q3-revenue-decline-net-loss-amid-gaming-digital-division-sale-to-apollo-global
