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Light & Wonder(LNW) - 2025 Q2 - Earnings Call Transcript
2025-08-06 21:32
Light & Wonder (LNW) Q2 2025 Earnings Call August 06, 2025 04:30 PM ET Company ParticipantsNick Zangari - SVP - IR & TreasuryMatt Wilson - President, CEO & DirectorOliver Chow - Executive VP, CFO & TreasurerRohan Gallagher - Managing DirectorBarry Jonas - Managing DirectorMatt Ryan - Co-Head - ResearchDavid Fabris - Equity research - Gaming & MediaDavid Katz - Managing DirectorAndre Fromyhr - ED - Equity ResearchAdrian Lemme - Director - Retail & Gaming ResearchConference Call ParticipantsRyan Sigdahl - Sen ...
Light & Wonder(LNW) - 2025 Q2 - Earnings Call Transcript
2025-08-06 21:30
Financial Data and Key Metrics Changes - Revenue for the quarter was $809 million, including partial contributions from Grover and record revenue at iGaming, offset by modest declines at gaming and SciPlay [22] - Net income increased 16% to $95 million, driven by lower cost of revenue and operating expenses [22] - Consolidated AEBITDA for the quarter was $352 million, an increase of 7% year over year, with a margin of 44%, a 400 basis point increase compared to the prior year [23] - Adjusted NPATA per share increased 11% to $1.58 compared to $1.42 in the prior year period [24] Business Line Data and Key Metrics Changes - Gaming revenue was $528 million, with partial contributions of $21 million from Grover, and AEBITDA was $280 million, an increase of 3% with a margin of 53% [25] - SciPlay revenue was $200 million, with AEBITDA of $74 million, a 6% increase year over year, representing a margin of 37% [28] - iGaming delivered record revenue of $81 million, a 9% increase over the prior year, with AEBITDA increasing 17% to $28 million [31] Market Data and Key Metrics Changes - Global game sales in the quarter were $191 million, primarily due to macroeconomic uncertainty impacting the timing of game sales [26] - North American unit sales were down moderately year over year, with operator apprehension affecting swap purchases early in the quarter [11] - iGaming in the U.S. and Canada continued its strong growth trajectory with over 25% growth in GGR year over year [19] Company Strategy and Development Direction - The company announced a transition to a sole ASX listing by November 2025, aiming to consolidate liquidity and maximize shareholder value [7][41] - Continued investments in R&D and expansion plans into Indiana, with expectations to deploy first units in the state this fall [7][12] - Focus on enhancing recurring revenue streams and operational efficiency across all business segments [24][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to execute with discipline and deliver a stronger growth trajectory in the second half of the year [12] - Positive feedback from operator partners indicates strong performance and value of Light and Wonder games amidst a competitive landscape [11] - The company expects third quarter year-over-year consolidated EBITDA growth to be in the low double digits, with momentum building into the fourth quarter [36] Other Important Information - The company has repurchased approximately $100 million of shares during the quarter, with a total of $1.3 billion returned to shareholders since the program's inception [35] - The Grover acquisition is performing ahead of expectations, contributing positively to the company's growth [62] Q&A Session Summary Question: Can you walk us through the investor engagement process regarding the sole ASX listing? - The decision followed extensive consultation with investors, with strong feedback received, and aims to optimize shareholder value by consolidating liquidity in a deep market [41][42] Question: Can you provide updates on the litigation? - Both Nevada and Australian Federal Court cases are expected to head to trial in 2026, with recent rulings moving in the company's favor [46][47] Question: Can you explain the new guidance range and its components? - The guidance includes $65 million from Grover, with the base business still targeting $1.4 billion, and investments planned for the second half to support long-term growth [50][52] Question: How is the integration with Grover progressing? - Integration is off to a fantastic start, with the business performing well and cultural alignment noted as a positive factor [62][63] Question: How does the company plan to address the impact of sweepstakes gaming on SciPlay? - The company is focusing on internal initiatives to stabilize and grow its social casino business, while also monitoring external market dynamics [80][82] Question: What are the expectations for free cash flow improvement? - Normalized free cash flow saw a considerable year-over-year increase, and the company remains focused on improving cash conversion moving forward [88][90]
Light & Wonder(LNW) - 2025 Q2 - Earnings Call Presentation
2025-08-06 20:30
Second Quarter 2025 Earnings Presentation August 6, 2025 © 2025 LIGHT & WONDER Forward-Looking Statements S E C T I O N T I T L E, 1 0 P T In this presentation, Light & Wonder makes "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements describe future expectations, plans, results or strategies and can often be identified by the use of terminology such as "may," "will," "estimate," "intend," "plan," "continue," "believe," "exp ...
Light & Wonder(LNW) - 2025 Q1 - Earnings Call Transcript
2025-05-07 21:30
Financial Data and Key Metrics Changes - The company reported consolidated revenue growth for the sixteenth consecutive quarter, with a 2% increase to $774 million compared to the prior year, driven by gaming and iGaming businesses [20][21] - Net income was $82 million, resulting in diluted net income per share of $0.94, up from $0.88 in the prior year [21] - Consolidated EBITDA grew by 11% to $311 million, with a consolidated EBITDA margin of 40%, a 300 basis point increase year over year [21][30] - Adjusted NPATA increased by 11% year over year to $117 million, with adjusted NPATA per share rising 21% to $1.35 [21][22] Business Line Data and Key Metrics Changes - Gaming revenue reached $495 million, a 4% uplift, with EBITDA growing 9% to $254 million, reflecting a margin expansion of 200 basis points to 51% [22][23] - Gaming operations generated $173 million in revenue, a 5% increase year over year, with an average revenue per day of over $48 [23] - SciPlay revenue was $202 million, with Quick Hit Slots achieving record performance, contributing to a 3% EBITDA growth to $64 million [26][27] - iGaming revenue increased 4% year over year to $77 million, with EBITDA growing 8% to a record $27 million [29] Market Data and Key Metrics Changes - The North American installed base increased by approximately 500 units sequentially, totaling over 34,000 units, with 51% of the fleet classified as premium [6][23] - The company regained the number one position in Australia for ship share, supported by strong game franchises [7] - The U.S. and Canada markets saw GGR increases of 3011% year over year, indicating robust growth in iGaming [12] Company Strategy and Development Direction - The company is focused on operational excellence, a comprehensive product roadmap, and reinvesting in R&D for sustainable growth [4][5] - A strategic acquisition of Grover Gaming's charitable gaming asset is expected to enhance the company's role in the global games market [16][17] - The company aims to maintain a high return on investment while expanding its direct-to-consumer platform [11][55] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the gaming industry's resilience despite potential macroeconomic challenges [5][34] - The company is committed to achieving its 2025 consolidated EBITDA target of $1.4 billion, despite tariff headwinds [34] - Management noted that GGR remains a critical metric, with strong performance observed across U.S. markets [84] Other Important Information - The company has implemented measures to mitigate tariff impacts, including diversifying the supply chain and pulling forward inventory [89][91] - The direct-to-consumer platform has seen significant growth, now accounting for over 13% of revenue [11][54] Q&A Session Summary Question: Impact of tariffs on business - Management indicated that tariffs are currently manageable, with strategies in place to mitigate costs and maintain revenue targets [40][41] Question: U.S. gaming operations yield - Management noted that weather-related factors impacted yields, but overall trading has returned to normal [48][49] Question: SciPlay business and DTC strategy - Management expressed excitement about a recent favorable ruling regarding alternative payment methods, which will enhance the DTC strategy [54][55] Question: International gaming business performance - Management acknowledged a decline in international installed base due to tough comparisons from the previous year but remains optimistic about future contributions [61][62] Question: Update on dual listing strategy - Management confirmed ongoing discussions regarding an Australian listing but indicated a cautious approach due to market uncertainties [70][72] Question: Pathways to achieving EBITDA guidance - Management reiterated the importance of maintaining momentum in gaming operations and optimizing costs to achieve the $1.4 billion EBITDA target [76][80]
Light & Wonder(LNW) - 2025 Q1 - Earnings Call Presentation
2025-05-07 21:16
First Quarter 2025 Earnings Presentation May 7, 2025 © 2025 LIGHT & WONDER Forward-Looking Statements SECTION TITLE, 10PT In this presentation, Light & Wonder makes "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements describe future expectations, plans, results or strategies and can often be identified by the use of terminology such as "may," "will," "estimate," "intend," "plan," "continue," "believe," "expect," "anticipate ...