Light & Wonder Increase Revenues By 12% In Q2 Report

Light & Wonder’s revenue for the second quarter of 2024 reached $818 million, a 12% increase compared to the same period in the prior year. This marked the company’s 13th consecutive quarter of year-over-year growth and its 8th consecutive quarter of double-digit consolidated revenue growth. The impressive performance was driven by strong results across all of Light & Wonder’s business segments, including Gaming, SciPlay, and iGaming.

The Gaming segment was a standout performer, with revenue increasing by 14% to $539 million. This growth was primarily fueled by a 32% surge in global Gaming machine sales, coupled with a 14% rise in Gaming systems revenue and a 5% increase in Gaming operations revenue. The expansion of the North American installed base, which grew by 7% to 32,566 units, and the successful launch of new game content like “DRAGON TRAIN” and “HUFF N’ EVEN MORE PUFF” in the U.S. market, contributed to the segment’s robust performance.

The SciPlay segment also delivered a solid performance, with revenue growing by 8% to $205 million. This growth was driven by the continued strength of the social casino business, which maintained a high level of player engagement and monetization. The company’s growing direct-to-consumer platform, which generated 12% of SciPlay’s total revenue, also contributed to the segment’s AEBITDA growth and margin expansion.

The iGaming segment experienced a 6% revenue increase to $74 million, reflecting the ongoing momentum in the North American market and successful content launches. However, the prior year period benefited from $2 million in license termination fees, which impacted the current year’s revenue and AEBITDA growth.

Light & Wonder’s strong revenue performance translated into robust earnings growth, with the company reporting a 17% increase in Consolidated AEBITDA to $330 million. This growth was driven by the revenue expansion and sustained margin strength across all business segments.

Net income for the quarter also saw a significant improvement, reaching $82 million compared to $5 million in the prior year period. This was primarily due to the higher revenue and strong margins, coupled with lower depreciation and amortization expenses, partially offset by higher restructuring and other costs.

Adjusted NPATA, a non-GAAP metric widely used in the gaming industry, increased by 40% to $130 million, further demonstrating the company’s ability to drive profitability and create value for its shareholders.

Light & Wonder’s financial performance was also reflected in its cash flow generation. Net cash provided by operating activities reached $141 million, compared to $34 million in the prior year period, benefiting from the earnings growth. Free cash flow, a key metric for the company, increased to $70 million, up from $24 million in the same period last year.

The company’s capital allocation initiatives further reinforced its commitment to shareholder value creation. During the first half of 2024, Light & Wonder returned $175 million to shareholders through the repurchase of approximately 1.8 million shares of its common stock, completing the full $750 million share repurchase authorization. Additionally, the Board of Directors approved a new three-year, $1.0 billion share repurchase program, demonstrating the company’s confidence in its long-term growth prospects.

Light & Wonder’s efforts to strengthen its balance sheet and reduce its debt burden, as of June 30, 2024, the company’s principal face value of debt outstanding stood at $3.9 billion, translating to a net debt leverage ratio of 3.0x, well within the company’s targeted range of 2.5x to 3.5x.

The company further enhanced its financial flexibility by repricing its Term Loan B in July 2024, reducing the interest rate by 50 basis points and resulting in a decrease of approximately $11 million in annualized interest costs, or $19 million including the January repricing.