Light & Wonder, Inc. Reports First Quarter 2025 Results

16th Consecutive Quarter of Year-Over-Year Consolidated Revenue Growth with Expanded Margins Driving Strong Cash Flow Generation

Added 2,900+ North American Gaming Operations Units Year-Over-Year and 500 Units Sequentially

Returned $166 million of Capital to Shareholders through Share Repurchases during the Quarter

Strategic Acquisition of Grover Gaming's Charitable Gaming Business on Schedule

LAS VEGAS--(BUSINESS WIRE)--May 07, 2025-- 

Light & Wonder, Inc. (NASDAQ and ASX: LNW) ("Light & Wonder," "L&W," "we" or the "Company") today reported results for the first quarter ended March 31, 2025.

We delivered another solid quarter, achieving a 16(th) consecutive quarter of year-over-year consolidated revenue growth, expanding margins across all three of our businesses and generating strong cash flow, while continuing to execute on our robust content roadmap and cross-platform strategy, and remain committed to $1.4 billion 2025 Consolidated AEBITDA target(1) (pre-Grover transaction). We also repurchased approximately 1.9 million shares of common stock at an aggregate cost of $166 million during the three months ended March 31, 2025.

   -- Gaming revenue increased to $495 million, up 4% compared to the prior 
      year period, primarily driven by growth across all lines of business, 
      including 9% growth in Table products and 5% growth in both Gaming 
      systems and Gaming operations. The growth was fueled by the success of 
      our diversified portfolio of game franchises and gaming solutions, 
      resulting in Gaming Operations North American premium installed base 
      growing for 19 consecutive quarters, 30% growth year-over-year in North 
      American unit shipments, and maintaining #1 ship share in Australia(2). 
      AEBITDA increased by 9% on revenue growth and margin expansion of 200 
      basis points. 
   -- SciPlay revenue was $202 million, a decrease of 2% compared to the prior 
      year period, but continued to outpace the social casino market with 
      strong payer metrics. AEBITDA increased 3%, while margin expanded 200 
      basis points, driven by our growing direct-to-consumer platform, while we 
      continued to invest in high return marketing initiatives to fuel future 
      growth. Our social casino business continued to deliver consistently high 
      player engagement and monetization, with ARPDAU(3) increasing by 5% to 
      $1.06. 
   -- iGaming revenue increased 4% to $77 million, and AEBITDA increased 8% 
      with margin expanding by 100 basis points, primarily reflecting continued 
      momentum in the U.S. and expansion of our partner network. 

Matt Wilson, President and Chief Executive Officer of Light & Wonder, said, "Our R&D investment, vast array of product offerings and comprehensive content strategy continue to deliver success in game deployment and franchise expansions. We continue to see our omni-channel strategy prosper with enhanced game development and performance fueling our existing businesses, and further opportunity to extend this strategy with the pending Grover Charitable Gaming Acquisition. We remain confident in the various avenues of growth that we see for 2025 with continued execution on our robust product roadmap driving performance across the business. We are committed to executing off the strong foundation of world class talent and game portfolio that we have built for long-term success."

Oliver Chow, Chief Financial Officer of Light & Wonder, added, "This quarter is a further testament to our commitment to value creation as we generated strong cash flow coupled with another meaningful quarter of share buyback. Our solid performance continues to be underpinned by a focus on streamlining and optimizing our business to enhance margins as reflected in the quarter across the three business units and corporate functions. The initiatives and processes that we have in place enable us to remain nimble and adaptable to a dynamic environment and positions us well to be a sustainable compounder of growth well into the future."

 
(1) Consolidated AEBITDA target range is a forward-looking non-GAAP financial 
measure presented on a supplemental basis and does not reflect Company 
guidance. Additional information on non-GAAP financial measure presented 
herein is available at the end of this release. 
(2) MaxGaming (April 2025) 
(3) Average Revenue Per Daily Active User 
 

LEVERAGE, CAPITAL ALLOCATION AND BUSINESS UPDATE

   -- Principal face value of debt outstanding(1) was $3.9 billion, translating 
      to a net debt leverage ratio(2) of 3.0x as of March 31, 2025, remaining 
      within our targeted net debt leverage ratio(2) range of 2.5x to 3.5x, 
      while we accelerated the pace of our share repurchases capitalizing on 
      the market dislocation and consistent with our capital allocation 
      strategy. 
   -- Returned $166 million of capital to shareholders through the repurchase 
      of approximately 1.9 million shares of L&W common stock during the 
      quarter. 
   -- Pending strategic acquisition of Grover Gaming's charitable gaming 
      business -- on February 18, 2025, we announced the pending acquisition 
      for an upfront consideration of $850 million, subject to customary 
      purchase price adjustments. Grover Gaming is a leading provider of 
      electronic pull-tabs distributed over five fast-growing U.S. states: 
      North Dakota, Ohio, Virginia, Kentucky and New Hampshire. The transaction 
      is expected to close during the second quarter of 2025, subject to 
      required regulatory and other approvals and customary closing conditions. 
      Our lead arranger has obtained commitments, subject to customary closing 
      conditions, for a new three-year $800 million Term Loan A credit facility 
      at leverage-based pricing expected to be in line with our current 
      revolving credit facility, the proceeds of which will be used for the 
      financing of this pending acquisition. 
   -- Impact of recent trade tariffs -- in April of 2025, the U.S. government 
      and many foreign countries imposed a series of new trade tariffs. These 
      tariffs place additional duties on imports, and we currently source a 
      portion of the raw materials and components for our Gaming Business from 
      China and across Asia. We have evaluated various mitigation strategies, 
      including but not limited to, supplier diversification, adjusting supply 
      chain operations, supplier pricing negotiations and cost control 
      initiatives, among other measures. Over the past several quarters, 
      through margin enhancement initiatives, we have successfully executed 
      meaningful operational efficiencies. While we expect recent tariffs and 
      trade policies to create incremental cost pressures in the near term, our 
      realized and ongoing operational efficiency initiatives coupled with 
      other measures are expected to mitigate these effects. We remain on track 
      to deliver our 2025 Consolidated AEBITDA target(3) of $1.4 billion 
      (pre-Grover transaction) and associated Adjusted NPATA targeted range(3). 
   -- Dragon Train litigation update -- Our external experts have now completed 
      a review of all hold and spin games released from 2015 to the present to 
      determine whether any of these games present issues with respect to 
      Aristocrat math values similar to those identified with Dragon Train and 
      Jewel of the Dragon, both of which were hold and spin games. Our experts 
      found no evidence that Aristocrat math values were used in any of these 
      games. 
   -- Hosting an investor day on May 20th in New York City, to provide an 
      update on our strategy and progress on key initiatives. 
 
(1) Principal face value of debt outstanding represents outstanding principal 
value of debt balances that conform to the presentation found in Note 10 to 
the Condensed Consolidated Financial Statements in our March 31, 2025 Form 
10-Q. 
(2) Represents a non-GAAP financial measure. Additional information on 
non-GAAP financial measures presented herein is available at the end of this 
release. 
(3) Consolidated AEBITDA target and Adjusted NPATA targeted range are 
forward-looking non-GAAP financial measures presented on a supplemental basis 
and do not reflect Company guidance. Additional information on non-GAAP 
financial measures presented herein is available at the end of this release. 
 
 
 
SUMMARY RESULTS 
 
                                         Three Months Ended March 31, 
                                  ------------------------------------------ 
($ in millions except per share 
amounts)                                  2025                  2024 
                                  ---------------------  ------------------- 
Revenue                              $              774   $              756 
Net income                                           82                   82 
Net income per share -- Diluted                    0.94                 0.88 
Net cash provided by operating 
 activities                                         185                  171 
Capital expenditures                                 61                   66 
 
Non-GAAP Financial Measures(1) 
-------------------------------- 
  Consolidated AEBITDA               $              311   $              281 
  Adjusted NPATA                                    117                  105 
  Adjusted NPATA per share -- 
   Diluted                                         1.35                 1.12 
  Free cash flow                                    111                   93 
 
                                                    As of 
                                  ------------------------------------------ 
Balance Sheet Measures               March 31, 2025       December 31, 2024 
--------------------------------  ---------------------  ------------------- 
  Cash and cash equivalents          $              134   $              196 

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