IGT’s Second Quarter 2022 Financial Performance Stalled

IGT’s Second Quarter 2022 Financial Performance Stalled

Supplier of gambling technology, software and equipment International Game Technology (IGT) announced Tuesday its second quarter 2022 results and revealed the business is slowing down.

Revenues Showed the Business Stalled

For the three months ended June 30, 2022, IGT showed total consolidated revenue of $1.02 billion, down 2% from $1.04 billion for the same three months in 2021 and down 3% when compared to the first quarter 2022 reading of $1.05 billion.

Across IGT’s divisions, Global Lottery accounted for $648 million to post a decline of 3% year-over-year on the $725 million generated in Q2 2022 and 5% when compared to the $680 million in Q1 2022. IGT noted that the division’s second quarter 2021 result included $70 million in benefits from the closure of gaming halls in Italy.

Global Gaming registered $330 million in revenue, an increase of 21% on the $274 million accounted for in the second quarter of the year before and 2% on the $325 million in the first quarter of 2022. IGT pointed to the strong replacement unit demand in Canada and the US, higher average selling prices and increased installed base yields as the main factors driving growth within the division.

Digital & Betting, the division created by IGT in September 2021, generated revenue of $43 million to post a marginal 1% increase year-over-year. When compared to Q1 2022, the second quarter result is 9% lower. IGT outlined that the division saw mixed results as online casino growth in the US was partially offset by other markets, while US sports betting was impacted by lower betting margin levels.

Operating Income, Adjusted EBITDA, Net Income

Total operating income in the reported quarter was $228 million, down 7% on the $244 million in Q2 2021. The decline was 10% when compared to the $255 million in the previous quarter.

Total adjusted EBITDA in Q2 2022 was $409 million, down 7% on the $442 million in Q1 2021 and 6% on the $433 million in Q1 2022, while the adjusted EBITDA margin fell from 44% in Q2 2022 to 40% in the reported quarter.

“Strong customer and player demand for IGT’s products and solutions drove some of our strongest profit results ever in the second quarter and first half of the year,” said Vince Sadusky, chief executive officer of IGT but his words do not seem to reflect the company’s Q2 2022 bottom line decline measured both against the previous year and the previous quarter.

IGT finished the second quarter with a net loss of $4 million as compared to a net income of $306 million in Q2 2021 and a net income of $117 million in Q1 2022. As of June 30, 2022, IGT had total liquidity of $2.1 billion comprising $700 million in unrestricted cash and $1.4 billion in additional borrowing capacity.