International Game Technology (IGT) 12 Mar 242023 Q4 Earnings call transcript

Hello, and welcome to the International Game Technology PLC Q4 '23 and Fiscal Year 2023 Earnings Call. [Operator Instructions] I will now turn the call over to Jim Hurley, Senior Vice President, Investor Relations. Please go ahead.

Thank you, Sarah, and thank you all for joining us on IGT's Q4 and full year 2023 conference call, which is hosted by Vince Sadusky, Chief Executive Officer; and Max Chiara, our Chief Financial Officer. After some prepared remarks, Vince and Max will be available for your questions.

will the some federal we the statements call, of meaning securities today's be forward-looking making within During laws.

in the expressed Forward-looking our statements could latest our implied cause those materially to uncertainties in our current actual and The and in or from results may our earnings risks are differ our materially that not and filings. forward-looking statements. guarantees, expectations SEC differ detailed principal results from release are

measures. will we this financial certain During discuss non-GAAP call,

disclosures non-GAAP webcast release, SEC, these reconciliations Vince filings to comparable additional now Relations including find press You'll our the our GAAP regarding website. And to posted Sadusky. I'll slides with measures, each which with measures and is turn in Investor over of the this accompanying our call

and margin us yielding Thank free and during strong goals, times operating hello delivered a with joining XXXX X year operating to XX%, cash which income the meet generation. growing enabled to financial were of We expansion everyone finish raised points year. us today. XXXX to QX This our strong fiscal flow basis you, XXX Jim,

the impressive ever. It's goals hard track acknowledge bringing entire of leverage with billion level financial billion I'd strategic the XX.X% that an In delivering of operating of into Global long-term team $X and growth in across the portfolio. of $X Gaming $X.X over operations across like set in debt record Global PlayDigital income, significant confirms the company's them. contributed EBITDA IGT the a margin. the are generation to our This achievements EBITDA net accomplishments work from lowest cash of Lottery, and the segments we billion record-breaking including cash to fact, on to and our in translated period,

IGT values We key not to great onlythe of culture but in These passion. are grounded responsibility, drivers have our also a and success place make collaboration a work.

the you IGT colleagues all my So around to world. thank

markets. increase growth especially with are Scratch & industry. understanding steady and among momentum in largest nearly consistent developing noteworthy. strong Italy games, player Win Lottery during managing operate is mid-single-digit same-store in IGT's compelling the expertise low new The in Lotto sales of successful the XXXX the the we most to world. Italy's of Italy and mostly increase and for games driven X% XX% broad behavior, and accelerated reflects same-store was in achieved sales continue over in growth The at America growth to officially conducting of single-digit existing portfolio the conditions fast We the excellence recognized top to time Institute, the operations. the each network U.S., cliff Lottery. up day-to-day in employer recently with their the recognizing the like for as on Italy and create a is was by our in operating and XXXX Top Employers employers top beginning Global leadership some Canada segment, the company, position maintained performance of which IGT fact, spend people. I'd through In certification global of the in of a rose numbers services extensions. sale. little and more impressive business period, than contract a the combination the as for organic X% a X% Italy growth, the in clear full net growth expansion sales the well years. iLottery distribution in sales on low XXXX, growth are a in by few in year, a for That's as last QX X% scale. Same-store achieved of revenue Rest year These World this organic commercial expand North

Kentucky extensions we key and jurisdictions, multiyear markets bolstered portfolio our largest like addition in year, of contract in the to with Virginia. our California, During Justice other some

in awarded n in and we Lottery potential. improved with a expanding successfully basis also an games Connecticut State the XXX profitability with year. Lottery market some We added Brazil the also XX%. industry pandemic points confirm points significantly expect live we to XXXX with their large, margin in a facilities in live significant margins. Operating of these iLottery accelerated Minas in characteristics. new this results with that and We levels new steady, instants operating level. a with passive are contract our maintaining platform higher and cloud-based to to growing Connecticut up are We went contract XXX important is business margins management during were where Gerais, mix. go recession-proof play later from Growth improved XXXX and games foothold launched resilient with basis pre-pandemic an

U.S. games. at new as higher the We looking to base, mid-single-digit more expect to the lottery adoption, many off where rate are launch especially Brazil, our expand fueled lottery sales customary low in organic some opportunities and growing the industry this such states There by in to growth horizon, are

indicators. revenue gaming. to on profit fueling growth and This key XX% operating Unit in strength approximately operational performance shipped strong is Gaming machines our fueled demand. is in up XX%. X% of income The replacement by by the prior for growth in led key strategies year casino from was operating up record product evident achieved units, focused performance growth double-digit We income full QX gaming selling up broad-based reflects average for Now XX,XXX Global a segment. several execution prices. year and XXXX, across with the X% over and year increase especially

Magic ranking high-performing which We in as has new Treasures, titles games, such the release top continue XX. X to

XX, top rank their in the mechanical games. XX categories. and DiamondRS top X American continue the reel of among PeakCurve cabinets The have XX also PeakSlant North We to new

of and unit growth consecutive X% the and the the installed by and in the premium named premium U.S. installed Award to Prosperity delivered units Canada, Canada global Latin XX,XXX considerable the and by in strong nearly led U.S. has Our units, reflecting grew and of game success World. Premium the in Rest X in with base EKG base new the We've Mystery Slot is fueled continued growth expansion quarters show. America. quarters of of top-performing launch Link Lamp, consecutive recently growth was X the accelerated which at premium of

profit highlighting margin result inherent games current new in Operating rich experience. to the powerful points revenue absence for new Slots over games iCasino for the regulation, of GGR of iCasino growth PlayDigital Houston new We basis and and Whitney of another double-digit launch fueled at direct our the XX%, driver the the both X% have XXXX, was pipeline Innovation expansion, in creative of market this leverage designed growth solutions exciting profit this rose vital geographies. across cabinet player in by SkyRise a U.S. an of is IGT's for was yielding increase new including revenue especially record business. Strong planned growth in on a much-anticipated lease sale deliver segment. a XXX year GGR spring. It is a and

highly Powerbucks with capabilities. games as platforms for jackpot Gold franchise jackpot combined liquidity top-performing game Canada. These unique of large-scale games U.S., Triple player online between and acquisition land-based, by Wheel successful omnichannel and mobile IGT's effective Our only Fortune formats. inspired the players Spin leverage the our are in tools. wins first They across in engage

In new engagement designed IP Cleopatra casino. We've customer. addition, adopters, player include and tailor X Sports new suite seen entered with more mobile XX online our Blackjack a jurisdictions results IGT's look locations, player These broadly. In productivity. XX analytic insights Knox great mobile retail Examples launches. and new out installations, drive Cleopatra, with and we for unique specific that leading also deploying early Casino and our customers have bespoke had launches Caesars customers We've Go in real-time X user Betting, Fort are for had success casino Caesars and of our we X to rolling provide Palace begun forward tools. FanDuel games and and for on-premise XXXX including these statewide for to

betting sports well. our appears dependent new business. We're to expected. to on stream terminals. PlayDigital which we'll driving the that be profits be focused In functionality to introduced with pleased as executed our IG record-breaking PeakBarTop excellence. legislation, been achieved slower cost the on for has of team margin the live XXXX and have the on case The This with expectations context, sports on also We track year. stay with growth capability CrystalFlex than efficiencies is in iGaming for

see we in the momentum segments. had across You this

and top-notch through The models, walk reflects with growth Our spin create believe with primarily Everi's creation later, the announced focused Global was evaluation value each to a business. We for each them provides increased Gaming portfolio. IGT and the with organic business optimized better Global service XXX% of for company faster-growing simplified organic X transaction pure more businesses merge customers operations. play, and XXXX the Max the stand-alone off focused fintech PlayDigital Lottery our and businesses. Recently, the existing strategies. It intrinsic each outlook, of owning appreciate to which operating business. of different decision pursue we capital teams also capital existing growth companies, that and will for Digital shareholders a allows predictable better stockholders. It Gaming, for models allocation ownership goal of strategic our significant will and growth stronger, are unlocking while of of a of value its more and the value the the for XX% strategies, flexibility retain to investors result the resilience and to inorganic structures business of opportunity positions and

the iGaming peers and new nonmatch and and of just compared Xx, has growth as global before XXx product across scale of similar These is at EBITDA. IGT potential III scope between value provide iGaming attractive synergies. model Class systems. peers, recurring will and that's believe to player For IGT's and fintech representing VLTs, companies between efficient EV games we points on addressing pro over omnichannel and benefit of casino best-in-class IGT of broad all of context, offering journey an trade with solutions. Together, casino XX and primarily fintech the the the across and gaming gaming II shop capabilities. The trade revenue a X America, extensive XX% management lottery revenue North forma business XX will trajectory Class touch business XXx a have mobile. of the footprints, ecosystem EBITDA gaming Everi's focused peers with capabilities we generate EV has a its to to integrated streams from an can that gaming and combination floor solutions, one-stop creates recurring revenue capabilities. The entire The from superior revenue. aspects and operations, proposition complementary business geographic to with

of grow chain with at even an single-digit We rate increasing high of growth by synergies top enhanced mix business. adjusted synergies, significant stronger a line combined straightforward value are businesses, worth initiatives. These through XXXX expect estate revenue through over existing compound EBITDA $XXX the for That's on their supply rates. mostly real own to growth a mid-single-digit annual cost organic at from and for the optimization million

Given companies, some the our there compelling geographies business synergies across outlook. factored between that yet products are X are and into the not overlap minimal revenue

organic both strong in a conversion cash significant team profile long-term in organizations leverage flow across value EBITDA We both with conservative Needless and will about record fintech. growth knowledge, expect has Lottery for best-in-class and team industry buybacks. The allow debt years M&A, the sheet improved company to manage made and to average and the very and for stand-alone share executive proven long-standing repayment integration. Gaming experience and a adjusted up business. we're business balance for The should M&A with opportunity and BXB a gaming be of over investments the across say, relationships creation excited XX to track of

Now to Max. call I'll turn the over

today. Thank you, us on call everyone hello Vince, joining and to the

that XXX income long-term clear by in to and trajectory performance Our results increased income. business the EBITDA In $X.X to the call to profit Gaming comparison key X% upgraded in period, outlook XXX the on quarter, quarter to momentum a been targets financial of achieved on over strong across QX strong, basis to million, driven financial increase prior divestitures fourth in the Italy. Operating our year prior we XXXX XX, sight operating XXXX periods have to in or performance services record of rose get is and fourth the EBITDA basis product of a share, including earnings financial delivered confirm by to included adjusted These most metrics. We our generated XX% commercial full there. A already reflecting XX%, year-over-year, achieving full despite segments. confidently with affected like per points increase expanded results here XXXX. over was year Italy billion, and $X.XX XX% Slide rose operating on points in in by increased million XX%. Adjusted prior are and and all summary basis continued strong the significant margin on Global margin of a revenue sales provided high-level our year X% X% $XXX income stronger EPS $XXX driven on Adjusted up year. Lottery comparisons

up single-digit is operating XX%. billion, chain Full margin Italy achieved a income company $X.X tax offset service Lottery, by easing income, EBITDA XXX adjusted and across and Gaming of sale increase billion history. Reported process business operating revenue up year generated PlayDigital of Global high driven share, same-store cost sales company per $X $X.X highest adjusted XX% the points income over EPS rose of in X% level EBITDA X% Italy in also to or our leverage history. Operating we was strong X% growth partially year, X% profit in Global full $X the EPS billion, R&D headwinds. For in record and to year-over-year, of basis by higher was margin segments. Strong mid- of adjusted $X.XX a some improvements commercial on net and in drove to supply operating which the

U.S. the Italy Global Lottery with strong impact rose prior expanded the product X%, revenue Poland. Operating IGT's product record sales by fourth lower $XXX system on XXX same-store X, high income of same-store and both declined by quarter, increased jackpot large in despite sales rose sales increase in Michigan to year-over-year, up points jackpot an Italy's that sales reflecting sale X%, margin Global X quarter. margin draw growth sales hardware self-service income central growth. fourth million propelled in of jackpot in and let's sales million the GameTouch and $XXX and for innovative XXXX. Same-store November quarter and in and sales demand that Ontario of a the results X%, segments. revenue terminal and from games. of strong delivered Now Customer the strong in tickets in were driven the instant business X by hit the fourth momentum our Powerball year basis XX% XX% drove Operating multistage with continue Italy sales to product in iLottery in billion XX bolstered activity. benefits XX% review

with the trends million, XX% U.S. the significant and XX% increased revenue higher-than-normal base to billion trajectory and X% year X.X X.Xx, process to leaves explained what returned operating low a the having jackpot form of the debt in we improved in we under and basis, over our maturities. This the after Global success costs revenue authorization in in quarter rating to with $XXX in the quarter, Moody's position margin dynamics and debt an as jackpot in ASP the lower the of a of of third income margin improving $XXX $XX easing rate This positive Sports expected outstanding the at line was sales. increasing BaX Momentum costs. Continuing current of by points of X,XXX million an installed lower million million of from in with revenue meaningful management a expectations. on points For Operating $XX actions cost We shareholders in terminal a with level units business business X full World lower dividends, to prior and stable points nice cash in cash in $X.X margin outlook, near-term XX%. were allocation compensation accelerated the Gaming rates increased improvements presented November strong our XX%, cost increases is year given agencies, margin Adjusted the to on to high generated progressive on license XXXX In X% across at investment-grade shipped year-over-year, issuer robust in income operating million and to Sports $XXX highest and XX% credit in remained we XXX broad-based following quarter of the offset to a income have income with the confirming America on no target of year performance fourth and iGaming Nevada the our earlier. On in OI operating from generally American by billion $XXX billion, prior of by base and of rose revenue of points X% a of including supply rating Latin conversion stable and offset our Revenue priority Investor and frequency chain credit line driven to as game. year in by billion basis operating slightly deferred half a due $XXX million, $XXX and to multilevel demand expanded million and were I very for Increased increased repurchase to year performance income taken rating product were $XX year, and strengthened basis reduction with drove reduced quarter sequentially capital $XX,XXX, base Canada expense expense quarter unfavorable operations expected us rating basis million the debt disciplined were to casino last the prior with approach revenue within but history. sales with progression basis to blip BB+ points key was income and in X% while XXX $X.X years, excluding the in year parts about X%, growing expense borrowing one Europe. Fourth the last turns volume full R&D in in basis expanding company area fourth of fourth operational a higher X to nearly continued the fourth expenditures the much XX%. PlayDigital level rating range the installed million the primarily our of continued above mix. The games, up rose million year. Operating rose global and early expanded was related the million year. over program. Total million was with of margin net $XX X.X Betting facilities. to to flow have GGR and partially Island. iGaming $X.X income the a $XXX operating higher includes progressive on games with IP the XX%, executing progressively X% senior installed increased Italy BBB-. sales. We X% indicators. XX% sequentially leverage XXX high-performing year, to across a a the operating XXX billion $XXX grew year-over-year, to X% with income jackpots Rest contribution last years, from units, in Global share in been service to Megabucks XX% which from in grew X.Xx. and prior $XXX capital cash cash year. manage rose commercial North year-over-year quarter, $XX,XXX $XXX with prior despite liquidity outlook, used operating and remains With XXXX. Operating also XX%. Record on BaX double-digit growth increased despite Day year-end, GGR credit in record by across leverage structure signing $X million geographies. to strength X% year-over-year. well services the across $X.X tracking which credit proactively period. leverage with over in in income Record to about $X.X slower undrawn unusually Italy fees expected $XX capacity hold reflected debt free expanded million. We've at the to and commercial new U.S., in growth drove balanced upgrading replacement was geographies. Rhode billion over significant down in XXXX, Strong legislation exceeded XX% fees profile XXX benefit Operating revenue free profile flow the the jackpot ASP additional next million full in in units Fitch our levels from $XX Betting variable geographies, achieved associated and driven wide system of XX,XXX strength around increases in million due over cash reflecting line

the S&P of addition, In positive merger and last placed a credit Fitch announcement and transaction, on watch. week IGT planned following the spin both

a This in approach now view helps for In the the to on to underlying targets XXXX complex the accounting year, introduce to Day. eliminates early also our long-term an were assess XXXX outlook. at towards closes Let effort our are need simpler business assuming provide Investor the XXXX. the our expectations adjustments we me transaction believe a provided for outlook progress last if you achieve closing. We we this

margin full a revenue impact throughout expect $X.X $XXX and ratably Those be in is costs and separation related XXX and divestiture income expected negative point of basis billion the year. between to the between planned year-over-year costs the million incurred to are to we transaction. due to be For XX%, merger $X.X pre-closing includes X%. Operating to of growth expected billion, spin from generate XX% which to year, implying X% currently

higher offers to activity in view Excluding margin flat underlying Global XX% lower XXXX. Operationally, assessment an will a costs, to than same-store experienced business between performance, assumes calls XXXX. the in separation the better this operating XXX slightly we jackpot that a to strong of basis divestiture our outlook sales points XX%, year-over-year, outlook for and believe up Lottery due and be

therefore, and for in don't to While the is our them large jackpots plan to forecast. do time from timing time, we unpredictable, tend happen

the our clear and with activities higher named low of the between of Gaming segment that to of no jurisdictions starting back with RemainCo to on aggregation are into a is and merge play much split new results. The expected a across with PlayDigital same-store our In consolidating simple exclude the will you Global Gaming levels. the cost aggregate jackpots, segments XXXX QX Everi, sales the and of increase to central digits allocation a facilitate previously policy. impact businesses of If understanding we segment to X single numbers Digital order have reported single decided change the

revenue We as we past, provide minimal and same modification. the will KPI in continue so expect from disaggregation to the impact level of the

is Speaking us improve and about continued installed long-term XXX margin existing Digital discipline, trends moving markets to This income XXX Gaming at KPI that, and we unit forecasted expect XX% XX%. of growth of X to focus supply and increase our Gaming, rate. to from the back chain comes new notch growth the single-digit the the to high of in ASPs pace has in target revenue continued in closer for base, to on basis shipments for points cost slowed. Operating on Digital favorable as improvement and legislation

our to cash Turning flow.

We business. of XXXX $XXX expect impact from multiyear Capital costs. $X the a cash recent of from operations to about in increase expenditures includes and $XX of billion, approximately Lottery separation contract extensions our contract at related million also least Global and divestiture includes million wins which

to against quarter, of to same-store includes and of expect point be expected are around to pre-closing, costs revenue down to $X unit year normal lower Lottery offset the in prior be year-over-year, sales American deliver is For a North than in XXX basis as return I on shipments mentioned. Global revenue income impact just also separation seasonality same-store pent-up a year demand the by Italy XX%, Gaming jackpot tough operating more and period. sales and divestiture likely first billion margin growth in prior which we the is comps. from approximately Digital

software to year. and licenses IP In last addition elevated

into value financing PLC to of companies. combined is with key diversification, to used other existing the multiples. I would the debt. the valuation generation player about Everi the $X.X well some of creates X.Xx to and IGT to use $X few PLC fund transaction. Upon minutes X is of reviewing existing pro financial with Since forma merger distributions IGT a million to gaming will potential a to indebtedness outlook less IGT close the trade that billion aspects that very and transaction-related expected PlayDigital spin for U.S. tax-free We since will expected of will it some RMP exemption this tax-free fund net as up followed the creation existing are remaining benefit of the be raise an merger. like like debt plans and Global to which The leverage position. to transaction even now to million combination drive at of of the [ has excited sheet stronger the a pure-play transactions entity the around gaming cash with the IGT Gaming as of following per Everi significant in planned is flow the than participation that completed of the and down nature PLC a separating done need I'd proceeds are has steps closing, from stand-alone spend reduction in growth to shortly of leakage peers you. Most putting closing ] to or from the IGT billion, transaction, focus an the debt transaction newly be significantly us address distribution share. area podium $XXX higher balance been in to transaction PLC scale, be operations of RemainCo modest, repay created by outflows. This $XXX par on regime, tax and cash billion IGT about $X.XX $X.X refinance distribution position as taxable

IGT buybacks entities important provides from to for transaction The also and taxable other taxable it both day X. of is The share maximum benefit initiatives a that is transaction flexibility M&A on like strategic shareholders.

be performance in segments solid financial predicated debt Everi the regulatory of net met liquidity XXXX is XXXX on the heading with PlayDigital this net and and Gaming spin history. We're upgraded in We completion merger have SEC on and and targets. delivered from financial foundation end on leverage debt debt as significant matter We well at maturities. the approval licensing 'XX and provided strong late the shareholder no transaction. To material with company or upon day. Achieving 'XX the significant in shareholders near-term successful the to early the and additional as flows growth, of Global cash improved filed the in with the profitable approvals on level results closing for a PLC to of that prospects XX-F disclosure approvals our summarize, generated lowest into we IGT clear

as X out the with and you prospect questions. about our milestones the expeditiously transaction Operator, significant the prepared open please laid concludes the merger remarks. stand-alone deliver stakeholders. That for have create for as global possible, to to will pure-play companies We Everi and line for spin are excited value we

[Operator Truist first Securities. of comes question Barry with from Instructions] line the Your Jonas

I target? start how Gaming. and maybe path What's of the much for on a more components understand hitting New XX%, what's could business little details you upside? that to wanted XX% be key in XX% that to give the transferable and And help the OI to Everi's Could with synergies to us then Co. embedded

is Barry. Hi, This Max. Sure.

XX%. closed year the we at again, So

minimum of of 'XX We And expect XXX the in end, between margin at XXXX right? upper a effectively the way is which the of accretion XXX, to targets. middle and the

have another a with we to to achieve. year similar So go, trajectory

on impacts Mystery the related are trajectory. the we gained high-rise the in Lamps which Link's, primarily new logical cabinet. in So to successful That base, positive have games of coming, Prosperity Whitney the margin momentum are to as positive and there. The to Houston that reflects in get first more launches tailwinds especially there installed such get item the sequential ratably, games is our of we

I we contributor based expect far which international installed be markets, tandem item international is base of again, installed in the foot expect which in the expectations the remind games. And we to sales on successful solid continue second successful you the of achieved. the chain, of a continue, finally, easing so in to on increase the the lastly, in an with momentum XX% accretion base XXXX positive XXXX. walk on to margin expansion cost, supply positive of will on for The then expansion to

it. Got it. Got

timing? on Any the Lotto Italy process. talk you And there I Okay. And to there positioning a then about your just just as incumbent? maybe how see on follow-up, as touch wanted renewal the updates

news online would Sure. coming would committee was to of X-year concession. could and the tender the then terms billion, Yes. the tender which upon outline concession fee start we by installments, was minimum in would upcoming of part that introduced new a $X upfront in some a be Italy with of terms and winning lotto be of the process, the multiple tender paid there be out there into a part start the be license that the license. What draft a the decree divided of was Gaming Recently, know for nonrenewable the finance a

they parties So past that's out, similar to will such of internally Italian significant to can the has they to which to considering the that course, news strategy demonstrate commitment. to bidders authorities order ensured achieve come high field an likely qualified such ROI to the say and regulator and execute commit significant the on both that capabilities convince the also potential prove of I execution capital a interested bar think, can willing candidates. And believe, we appropriate for of set be a their we'd need then amount then, limits their a in

for to operated about decades. the of lottery continue we, potential course, us, to we're have do the so. For And excited X

quite codify there's goes, that have once, they the make all to assessment the past in their seen and As the economics, lengthy far has process. to of the the as then formal a needs government in have then an we've assessments take the and there's course, place to a that to they and interested finalize which as done, process tender, lengthy. And draft legislative it's for process well, once is parties a offers, award. is of all offer the ultimately up some make issued, bid, then is of tender time course, The

frame our is the time to think this we a So X.X years best estimate. year probably all and for

quarter and Appreciate year. congrats the Perfect. color a on nice and

Your Macquarie. next question Beynon comes from Chad with the line of

more And Lottery? businesses that more January. kind also in -- that the Was of of Vince, trends we softness heard those operating in we the got from your about seen have inclement Gaming wanted some case that after then in weekends, and lottery? January your we've past lot both Max, business a I partners consistent, weather stable the that affected ask importantly, of to

off start on Lottery I'll with touch Yes, then base and Gaming.

by a XXXX somewhere or year I course, go sales X% puts of Millions so, over XXXX think of XXXX a in same-store very in growth in very and and driven perspective. We everybody Powerball instant -- good the draw components saw and of X% just significant from what because, saw increase I'll in under Mega activity reminding we into XXXX games the product XX jackpot of XXXX saw course. in in sales. increase We growth in an

say ended there's level has So year about have significant think quarter, a for in slightly, prior jackpots. multistate again, really, thesis, been but by continue they our we the as back up in that's actually and the well. multiple XXXX, up from XXXX, -- increase up And pre-pandemic. from were if you a remarkable were really going to these instants in year. these play saw as growth strong the and even XXXX. In over fourth being that X% was and draw at down the stronger about And pretty I'd to pretty is years, strong held made elevated to really levels as jackpots been

take first at In Italy, quarter Looking to North trends, mid-single Italy very continue to and of separate. we digits. you have course, up growth, the America strong have

We jackpots, given moderate, rest again, of has launches. and quarter, several team of that somewhere was due particular, demand making do Powerball the so last first -- the world, a the just America outstanding those innovation in constantly in those and fresh to will the over that of sales that think growth the are that And quarter and job of We the up down Mega we'll will course in stimulating impact in moderate. negative of of timing lot last were with in course, The launches in end an in product low high continued the hit of and The double expect years, moderate Italy. In North We of that in enjoyable. to done jackpots that games year. single-digit the single, America. throughout low growth the much the and has timing the North first quarter multistate of particular, probably the of new think digits. as

down outlook. we the as can in think Rest And probably a provided, same-store so we single as of be we expansion game that a to low we'll be of result believe think the as America kind as and long-term low we'll world. And on of basis, digits growth our the to in North well innovation maintain of of kind mid-single-digit the that We portfolios. Max

on bunch Some of the detail of but several seen the IGT in and of you've performed over that -- efforts that, -- a a the last I won't years, particular. in through activities bunch go

On we're in really shape take product kind terms the our portfolio. remind that. a great I'll side, of machine gaming everybody of minute just in of to

games, new the games XX top XX We new most the games. rank new new the in franchise, our Treasurers, Mystery of premium our have are February video games that lease amongst in in core the X Eilers the of Lamp got We've XX top top WAP several recent report. games ranked franchise, Magic

at or recent incredible of have of XX industry the year hardware top 'XX, and off specifically was of the launches have our course, fairly the #X the their XX industry. we gaming To XXXX. coming record about over in speak #X so for last another an games ranked The Chad or stepper, Our categories. year GGR play. somewhere about pressures really think industry around income terms of and of was people's in and for concern of estimate affinity concern around the for the particular, casino in the consumers. None recessionary the When up around while disposable out, year, in X%. that -- played start least was entertainment you the

with right around GGR strong But start there you've that's January of customers you've question X% there is really estimate are discuss trends year, that was slot report, the as how or our a heard, sure. We softer and really the casino research so, heard sentiment really the quarter, fourth and much customers Not up been the in casino for remains held annual in course. the fact, December potentially our off published, good. weather. customer as sure, the of overall, In

of for we're our because which of the profitable is certainly We of result item seeing lead being is play returning lot slot casino our to able demand historical chain kind And went pent-up normalized customers. kind a a most sales XXXX supply into course, not product levels. funnel, to as with a of Of more times. of deliver

kind regulatory other well we right compete markets hurt Europe pretty has challenges like Western and Latin now. When gaming, situations sociopolitical between Games a of market. and at and Lat Eastern clear America, kind Romanian would play challenges. In Western Australia. IGT taking a I Am Eastern very that very has much look We've well and place pre-pandemic there. strong. of Europe. in by back, U.S. recovery particular, So tax the And EMEA, the more behind been of really in some there and specific been is line is you normalized say the seen outside for EMEA levels. things are Europe

You've Australia then macro-related in now Mexican we resolved places hope and some that throughout a restrictions impacts like imposed import are though, new At by course weaknesses government year. And seen the and significant moment, the all pretty and increase share, it's be done continues that of the New in in installed with very not the Argentina can of increase there base. the systems market. gets but suppliers, environment a that we've challenging, team competed We've that well confident but macro Zealand, games to is the well slate we've got as in growing. in market, new much the and that our

start demand Gaming, We Lottery, of that jackpots going year. lot of And say the of into last a Again, restrictions. XXXX. is unnatural the very think strong So supply kind from very then start it's last pent-up for definitely very the specific overall, the versus of slower of than year in chain specific in reasons. timing I'd year to

then That's just a the on And great. CapEx, housekeeping follow-up.

can help go 'XX. So contracts and CapEx about just Lottery? help million what Digital a ex of guidance us number should Can the post SpinCo? going And new to forward also you maintenance us kind for Lottery with of you for Gaming versus then $XXX think

Chad. Hi,

investment into the our have increased installed CapEx base X.X in our Gaming we years. last of effectively the terms in So in number,

the so And above has Gaming figure CapEx $XXX million. increased of

related next an renewals on to But expectation contract year, X starting number the in now from year. Instead, that cycle couple face Lottery the of contracts to been of is see We the side, expect and on a significant that picking call. is to during that X years. slightly about to next we favorable going the mentioned are CapEx million to we Lottery, as next we're the an primarily have increase some we moderate last again there in coming up $XX which for X of years,

in CapEx plus that Kentucky the are spend early on expect investments So These to those contracts extension long 'XX. Virginia. we and California,

about And of associated $XXX CapEx terms really renewals, maintenance to of growth number to were Lottery that again, you kind if a again, versus -- anything contracts, above the per is forward. have will extensions clip of that going so related been if exclude CapEx large this contracts, terms long-term I'm the cycles. And or you want, upcycle wins in so of, has we in about Historically, talking in or the million new business. year running business in historically at with

the comes Instructions] of line question with Jeff Stifel. next Your [Operator from Stantial

Max, or this. whoever take wants to Vince

seems You Global Jackpots. to the This guide year back low single-digit Lottery impact for a growth strip assuming reversion the Gaming talked sales Multistate if full you about out reflect of what of will in the trends jackup data conviction are demand? you gives quarters fatigue. I seeing they after this several that specifically underlying more stabilized core you to in guess improving

say have look and that maintained they've of as seen And up. we've we're our post-pandemic in I level, markets, given been grown would -- of again, has got improving. the week-to-week we kind have slate we that confidence play well. coming launches the some history, has think given trends I And been past more that game Yes. our significant as

we get the games we as again, of slate continue to calculation to exciting continue help will is but think states high to to the gives we that ability Multistate that's So players to believe the number certainly have continued advertised rate Jackpot players. to a to as of Jackpot the visibility purchase. playing And the build, interest given ability do think But unpredictable, folks about given the the well an to advertise don't environment, perfect that lottery. infrequent lottery impulse with largely Multistate

Great.

So from...

Yes.

Sorry, more technical here. a standpoint Jeff. From

as XX that said, advertised last And for this in can have last has XX XX $X we months to we exceeds jackpot been seen again, months. mention in increase jackpot the attributable billion, the X games the likely been So the least. to steady and at

So annuity as are stream. they advertised interest rising based on environment XX-year jackpot a levels are helped by rate the

as So $X that means that it doesn't same underlying crept sales to billion advertise did it up. the a before take jackpot interest day a the of level few a years ago

mind, percentage of all is although that, mind keep So keep in IGT sales, as lottery that of a size. in the remunerated jackpot ticket not advertised

long-term year. the jackpots. We full was when basis the with outlook of there Lottery you exclude $XX 'XX, versus so higher in comfortable for a lastly, And single-digit full for jackpots. net, this we revenue the the business impact jackpot financials million the generate year; are large when impact XX on of And low net about remain the growth

the embedded color. in quarter. of QX for seasonality business, follow-up, helpful you the about Great. then or That's at And talked turning the guidance to the normalizing slot my Gaming end

kind the would to of as go related informs guess been that behavior this view purchasing underlying of seasonality data Just driven? seasonality you kind more to existing to what I that pullback I gives of share formed kind your the accurate or So market competitors? related to is more for assume that's mostly macro sequential you're by comfort seeing here. I guess specifically, pretty what opposed is more pullback and

Yes, sure.

of when estimate couple unit installed percentage industry IGT installed North that, sales in somewhere XXXX, similar is about probably And up grew look was couple the up at a in range. of a at base. data is the XX% slowdown calling least and the the unit base in increase compared So the a to went in same One and you the for industry XXXX, share. In points of America sales points. for

good we as international at IGT, performed Asia to is have significantly well markets last but And a is in and we've think to our internationally, pipeline to momentum very us. America, So achievable the done in in of as an the at we in North several the we is for games and lot compete Pac. rate look important we given believe we increased. We exciting same momentum opportunity growth Latin continue when had product, of America, ability can North of continue the and the feel share less where penetrate and of we've that going good years growth so kind not have Europe in over the come very strength for grow the some that penetrate America, to

of question Equita. comes Ghilotti Your next line the with from Domenico

question Lottery business. on I the the have profitability a on

the should First jackpot as you say, least And that business? we room maybe at or of that the QX? -- so that say, profitability impact X-X have with level all, above keeping some I at -- for a XX, profitability for the an in expect, is answer just EBITDA a XXXX. that the on we second, some, is bit less high. we have on the to contribution negative expect on environment got in sure the Lottery say, and be Or the Should business supportive cost. the very for level It's fixed seen

year XX the X-X, repeated Hi, 'XX. versus Domenico. is 'XX right, you Yes, the number for full

margin of are we Investor the in target of the expectations, our quoted margin -- at our expect, high terms Day Lottery. we In the for for end we

good contracts, thing to in remain very order we continue to margin existing to So hard to and of have a rights the do. And again, in work definitely holding to be to earn execution would that efficient to gain the that, obviously, do very new the pipeline.

was the fourth in product sales, margin, were a executed. On we deliveries a almost product that year specific sales benefit, significant year-over-year up ahead if a Lottery because again, slightly terms XXX% vis-à-vis of of there year-over-year. the we which finally, benefit, are basis, So onetime on you want, full quarter in

that of to ourselves for. margin the really long-term, was able it hold we impact. the within a line expect more range So quarterly on again, quoted But to we be the

of Katz Jefferies. David line question the next from comes with Your

a just to for their forward about wanted a period push sense you're And about the now momentum right? to businesses, that have and businesses that of closing. gaming about around strengths talk where combination while. And you and just take product-wise, could be, done? assets place, we continuing their help keeping people get the you their the together the lead of is thinking where can I X capabilities do standout specifics how or and process strategically X combination some between sort in time Vince, how think Because closing the gaming once could they're

for question. Yes. Hey, David. Thanks the

companies highlight many we've but talk Eilers able on announcing game been to been top or top recruit about don't we for retention recruit the So responsible talent. over have even will top years, momentum plans say, IGT the place prior had One a things. last both given particular in I that of couple And of transaction, couple has for their is in to -- game this, to list. some really this that we've this able games developers are

good Everi that at having now believe together. the talent in of to I commitment industry, to the we just complementary recruit fact have the organization, customers combined conversations feel had with our to keep the that very are messages strongly the week. we think resolution We the our and from IGT team merger. They nature companies a reactive together new really So we've discussed with a commercial really which we've have level And teams. little talent. We've with going that to happened essentially be associated few and both excitement genuine the highest been and about entity, in much the their be team enjoy that in excitement our benefit had there's and ability really a the with top lot commercial weeks our less very overlap. knowledge last of in received of anticipation our ago, feedback what's they

So that I really was exciting. think

anyone really talked we have to us and the on be such new footprint, our differentiate areas a going and generate to in doesn't, think things would what and said, employees, we've the don't and solutions. to customers. top-performing fintech, a of expertise is and our have and studio comprehensive have both portfolio have complementary. When several international for really games. Everi continuing competitors that teams It basis, we're experience, to we've creative which got We about products standout. we from particular, peers we key a as believe good we absolutely our in a offer combination absolutely has global about organization And our combined these range real folks in to IGT being the impressive to think got for our go-forward will recruiting will

As great recurring billion, cash pro think billion, position of the more somewhere we've past, EBITDA on past, we've diversification, mentioned units. in installed this a really said and scale, is forma at product -- to an looking of the in par podium an I XX% a of our revenue basis, opportunity that competition. We're roughly just all around than XX,XXX $X.X base player $X of great great create flow, on with with

gaming excited to folks shop Sports company being new we fintech to the journey our good a player really customers and and So one very something from about. land-based being that complete proposition is one-stop the a for think that able excitement very value with to iCasino, are that is provide Betting the around associated

there just singles and leverage you a doubles we systems, longer-term and one with strikes it lot as past something respect investors ways had each much And weeks we've fintech since post-closing? this. together, that just and learned quick Perfect. that's can immediately about other a opportunity. a to shorter-term discussion Are It's putting more of those follow-up. With

both tech longer-term of combination organizations. financial would is And collectively We've lot be leaders there. working the we a work space. to leading think in is plans do We're BXB operating detailed the really company play got on again, with and content get our the you I to from merit. to strong integration has say, and -- the Yes. out, as overall, point

on our on short-term, It's the really the really that's So focus. long-term. not it's

closing There CEO, are the this call to questions remarks. turn I time. for at Sadusky, Vince further no will

us joining for Thanks everyone. thanks, Look, today. Yes.

XXXX As Global and Lottery, ever. We emerging to heard, to our EBITDA, recent Gaming and with you've was drove lowest leverage truly segments. brought a the with We our strong we and growth income Thanks a IGT businesses believe the level and in creates and decision Global to across for Gaming off customers PlayDigital company's year record good down value the operating spin create creation the operations your unlock think significant our stakeholders. X to them or existing interest more companies service X the of of a really Everi's value better full more for have positions opportunity -- great exciting portfolio. We day. and focused of focused PlayDigital

This call. you concludes thank joining. for all today's conference We

may You your disconnect lines. now