IGT reported lukewarm results in the company’s latest earnings report amid a multi-billion transaction to improve its bottom line.
The London-based gambling company generated $1 billion in revenue in Q2 2024 mirroring results posted for the same period last year. IGT’s revenue in Q2 2024 was spearheaded by its Global Lottery segment, which reported $613 million in revenue during the quarter. By comparison, IGT’s lottery business saw revenue reach $624 million in Q2 2023. In addition to the revenue decline, IGT reported flat revenue in Q2 for its Gaming & Digital segment, which has been a hot topic of discussion across the gaming industry in recent weeks. IGT’s Gaming & Digital business generated $436 million in revenue in Q2 2024 compared to $432 million for the same period in 2023.
IGT posted stagnant results amid a pending sale of the business.
Last week, Apollo Global Management agreed to acquire IGT’s Gaming & Digital business and Everi in a deal valued at $6.3 billion. IGT is offloading the business and Everi to the asset manager’s new holding company, Apollo Funds, following a strategic review. The review led IGT to consider separating its Gaming & Digital business into a taxable spin-off to shareholders with the company selling IGT Gaming and Everi to Apollo Funds.
“This simple straightforward transaction provides a clear-cut separation of global lottery from gaming and digital for IGT shareholders,” IGT CEO Vince Sadusky said during the company’s Q2 earnings call. “There is a substantial increase in cash, nearly $1.5 billion, which provides a quicker realization of value upon closing, thereby eliminating IGT shareholder exposure to execution risk regarding integration efforts and synergies.”
Apollo Funds plans to transition Everi and IGT Gaming into privately owned companies once the transaction is closed. IGT will use the fresh capital from its pending sale to Apollo Funds to improve its bottom line by repaying debt and returning value to shareholders.
“This establishes the company as the premier pure-play lottery business with a diversified contract mix, broad global reach, and strong positions in import markets,” added Sandusky.
IGT expands lottery operations
IGT made efforts to bolster its lottery business in Q2 by securing a three-year contract extension with the Mississippi Lottery Corporation. As part of the deal, IGT will continue to provide online gaming systems and instant ticket services in the state through 2029.
The company also landed a contract with the Colorado Lottery. IGT will be replacing the state’s current central system with its Aurora system as part of its seven-year agreement.
IGT reported an operating income of $230 million in Q2 2024, an 8% decline year-over-year. As of June 30, IGT had $1.7 billion of total liquidity. It is withdrawing its previously announced full-year revenue outlook for FY2024 amid its pending sale to Apollo Funds.
