International Game Technology (IGT) raised its full-year revenue guidance after experiencing growth across every business segment and product type in Q3, helping overall revenue grow 20.6% to $984m.
Of IGT’s $984m in revenue, its global lottery business brought in $652m, up 14.1%.
Breaking down this global lottery revenue further, operating and management contracts – after accounting for $51m worth of license fee amortisation – brought in $539m, up 14.0%. Other services brought in $78m, up 4.0%, while global lottery product sales were up 70.6% to $35m.
Revenue from its global gaming business, meanwhile, was up 34.3% to $289m. This included $116m worth of terminal service – up 43.7% – plus $56m of systems, software and other services, an 8.2% increase, as well as $81m, up 64.3%, in terminal sales and other sales of $36.2m, a growth of 7.0%.
Digital and sports betting revenue came to $43m, up 36.8%. All of this revenue came from services.
In total, $832m of IGT’s sales were of services, up 16.7%, while product sales were up 46.2% to $152m.
Breaking down revenue geographically, the US and Canada brought in $556m, up 25.7%. $294m in revenue came from Italy, up 18.2%, while the rest of the world contributed the remaining 7.1%.
Operating expenses also grew, but much more slowly, by 5.8% to $772m.
This included costs of sales for services, which amounted to $422m, up slightly from 2020, while for product sales, this figure was up 12.0% to $93m.
Selling, general and administrative costs were up 8.8% to $195m, while research and development expenses increased 32.2% to $63m.
As a result, IGT’s revenue was up 143.7% to $212m.
After interest expenses of $79m, down 22.0%, and a $6m foreign exchange gain – compared with a considerable loss in 2020 – IGT’s pre-tax profit was $138m. This was a major improvement from 2020, when it recorded a $170m loss.
After paying $37m in taxes, IGT’s net profit was $101m, bouncing back from the $102m loss it made in 2020.
Chief executive Marco Sala noted that the improvement in IGT’s results came thanks to impressive growth in all areas.
“Broad-based momentum across our Lottery, Gaming, and Digital & Betting activities drove significant improvement in key financial and performance metrics in the third quarter,” Sala said. “Revenue grew over 20% and operating income more than doubled, highlighting the strength of our portfolio.
“Based on our excellent year-to-date results and our solid financial condition, the Board reinstated a quarterly cash dividend, signaling their confidence in the company’s prospects.”
As a result of the Q3 performance, IGT raised its full-year outlook for 2020. Where previously it expected revenue of $4.0bn, it now projects this figure to be $4.1bn. It also projected operating income of $900m, up from the previously projected $800m.
Looking ahead, chief financial officer Max Chiara said lottery sales in October suggest that Q4 could be another strong period for the business.
“In October, we are seeing lottery sales that are structurally above pre-pandemic level, we’re seeing consumption above historic trends,” Chiara said.
Chiara added that he expected future quarters to also be very strong, with 2022 revenue expected to be in line with 2021.
IGT has made a number of senior hires in recent weeks. Most recently, it appointed Gil Rotem, formerly of Bet365 and 888, as its new president of igaming. Last month, it selected Joe Asher, previously chief executive of William Hill US, as its new president of sports betting.
