LONDON - International Game Technology PLC (NYSE:IGT) reported a robust first quarter, surpassing analyst expectations with adjusted earnings per share (EPS) of $0.46, a significant $0.16 higher than the estimated $0.30.
The company's revenue also exceeded forecasts, reaching $1.07 billion against a consensus estimate of $1.03 billion. This performance represents a 1% increase from the previous year, primarily driven by substantial growth in the Global Lottery sector, which somewhat cushioned the impact of the timing of Gaming & Digital product sales.
CEO Vince Sadusky attributed the strong quarter to "innovative game, hardware, and systems solutions," which led to better-than-expected performance in Global Lottery and Gaming & Digital. The company is now upgrading its revenue and profit goals for the full year 2024, reflecting a positive momentum across key performance indicators. CFO Max Chiara highlighted a record organic profit performance for the quarter, citing the company's historically low net debt leverage and ample liquidity as indicators of its operational strength.
The Global Lottery segment saw a 6% year-over-year (YoY) revenue increase to $661 million, boosted by higher product sales and sustained sales strength in Italy. Meanwhile, the Gaming & Digital segment experienced a 7% YoY decline in revenue to $406 million, primarily due to lower product sales and fewer terminal shipments, offset partially by a 10% increase in iGaming revenue.
Operating income remained stable at $256 million, with an operating income margin of 24.0%, outperforming expectations by approximately 400 basis points. When excluding Separation & divestiture costs, operating income rose 7% to a record $273 million, and the margin expanded 150 basis points. Adjusted EBITDA was reported at $443 million with a margin of 41.5%. Without the Separation & divestiture costs, Adjusted EBITDA increased to $461 million, improving the margin to 43.1%.
Looking ahead, IGT provided guidance for the second quarter of 2024, projecting revenue of approximately $1.05 billion, which falls short of the analyst consensus of $1.095 billion. However, the company's full-year revenue guidance of roughly $4.4 billion is notably lower than the consensus estimate of $6.939 billion. Despite this, IGT anticipates an operating income margin of around 21%, or approximately 24% when excluding Separation & divestiture costs.
IGT's management remains confident in the company's direction, as evidenced by the CEO's statement on the progress made in separating the Global Lottery from Gaming & Digital and preparing for the proposed transaction with Everi. The company continues to innovate and earn accolades, such as top honors at ICE London 2024 awards and a AAA MSCI ESG rating, underscoring its commitment to sustainability and corporate responsibility.
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