IGT shares dropped by 9.5% on 14 May after the company released its Q1 2025 earnings report, showing a sharp decline in both revenue and profit margins.
The lottery tech firm posted $583 million in revenue for the quarter – a 12% fall from $661 million in Q1 2024. Net income from continuing operations tumbled 93% to $8 million, with profit margins narrowing to just 1.4%, down from 17.5% a year earlier.
The downturn was largely attributed to reduced US multi-state jackpot activity and lower incentive earnings tied to lottery management contracts.
Vince Sadusky, CEO of IGT, mentioned:
Global sales of instant ticket and draw games continue to expand, driven by a steady pipeline of game innovation and portfolio optimization strategies. While the world is currently faced with great uncertainty, we are excited about the initiatives we are working on to drive sustainable, long-term growth and shareholder value.
Max Chiara, CFO of IGT, added:
First quarter profit was in line with expectations at constant currency and we delivered strong cash conversion. Given lower U.S. multi-state jackpot activity and the current worsening macroeconomic environment, we believe it is likely we will be at the low end of the full-year revenue and Adjusted EBITDA guidance provided in February. With a solid financial profile and ample liquidity in advance of important contract renewals, we remain well-positioned for the future.
Due to reduced U.S. multi-state jackpot activity and a deteriorating macroeconomic climate, the company now forecasts revenue of around $2.55 billion and adjusted EBITDA of approximately $1.10 billion – both at the lower end of the guidance issued in February 2025. Additionally, cash from operations is expected to show an outflow of roughly $350 million, largely driven by increased foreign exchange impact on the first two payments for the Italy Lotto license.
Still, IGT reaffirmed its quarterly dividend of $0.20 per share, with a record date of 29 May and payment on 12 June. It also highlighted a solid liquidity position of $2.2 billion, including $600 million in unrestricted cash and $1.5 billion in borrowing capacity – resources it says will support key contract renewals ahead.
