Light & Wonder Extends Growth Streak, Eyes $850M Grover Gaming Deal
Light & Wonder, Inc. reported a steady 2% revenue rise in Q1 2025, marking its 16th consecutive quarter of growth, alongside margin expansion and a $166 million share buyback. The company is on track to close its strategic $850 million acquisition of Grover Gaming’s charitable business.
- 16 consecutive quarters of year-over-year revenue growth
- Gaming revenue up 4%, driven by table products and systems
- SciPlay revenue down 2% but with improved margins and engagement
- iGaming revenue increased 4%, with record wagers processed
- Returned $166 million to shareholders via share repurchases
Steady Growth Amid Industry Challenges
Light & Wonder, Inc. (NASDAQ and ASX: LNW) has reported its first quarter results for 2025, continuing a remarkable streak of 16 consecutive quarters of year-over-year revenue growth. The company posted consolidated revenue of $774 million, a 2% increase from the prior year period, driven primarily by a 4% rise in its Gaming segment. This steady performance underscores the company’s resilience and strategic execution in a competitive and evolving gaming landscape.
Gaming revenue growth was broad-based, with table products leading at 9% growth, complemented by 5% increases in both gaming systems and operations. The North American premium installed base expanded for the 19th consecutive quarter, reflecting strong demand and successful product deployment. Meanwhile, the company maintained its leading ship share in Australia, signaling robust international presence.
Mixed Performance in Digital Segments
The SciPlay segment experienced a slight revenue decline of 2%, attributed mainly to a decrease in average monthly payers, particularly in the JACKPOT PARTY Casino title. However, SciPlay outperformed the broader social casino market by improving its margins by 200 basis points and increasing Average Revenue Per Daily Active User (ARPDAU) by 5% to $1.06. This was supported by a growing direct-to-consumer platform, which contributed 13% of SciPlay’s revenue and drove margin expansion.
iGaming revenue rose 4% to $77 million, with an 8% increase in AEBITDA and margin expansion of 100 basis points. The segment benefited from continued momentum in the U.S. market and an expanding partner network, processing a quarterly record $25.2 billion in wagers. These digital segments highlight Light & Wonder’s diversified revenue streams and adaptability to shifting consumer preferences.
Capital Allocation and Strategic Acquisition
Light & Wonder returned $166 million to shareholders through the repurchase of approximately 1.9 million shares during the quarter, reflecting confidence in its financial position and commitment to shareholder value. The company maintained a net debt leverage ratio of 3.0x, comfortably within its targeted range of 2.5x to 3.5x, balancing growth investments with disciplined capital management.
Strategically, Light & Wonder is progressing with its $850 million acquisition of Grover Gaming’s charitable gaming business, expected to close in Q2 2025 pending regulatory approvals. Grover Gaming operates electronic pull-tabs across five fast-growing U.S. states, representing a significant expansion into the charitable gaming market. The acquisition aligns with Light & Wonder’s omni-channel growth strategy and is supported by a committed $800 million credit facility.
Navigating Tariffs and Operational Efficiency
The company acknowledged recent U.S. and international trade tariffs impacting raw materials sourced from Asia. Management has implemented mitigation strategies including supplier diversification and cost controls, aiming to offset near-term cost pressures. Coupled with ongoing margin enhancement initiatives, Light & Wonder remains confident in achieving its 2025 Consolidated AEBITDA target of $1.4 billion (pre-Grover transaction).
Executive leadership emphasized the strength of the company’s R&D investments, diverse product portfolio, and operational agility. These factors position Light & Wonder to sustain growth and margin expansion despite external challenges, including regulatory and market dynamics.
Bottom Line?
With solid fundamentals and a transformative acquisition underway, Light & Wonder is poised for continued growth but must navigate tariff pressures and integration risks.
Questions in the middle?
- How will the Grover Gaming acquisition impact Light & Wonder’s financials post-closing?
- What are the long-term effects of recent trade tariffs on cost structures and margins?
- Can SciPlay reverse its payer decline while sustaining margin improvements?
