Light & Wonder, Inc. (LNW), a global leader in gaming and digital entertainment, reported robust financial performance for the first quarter of 2025, continuing its streak of growth. The company posted consolidated revenue of $774 million, marking a 2% increase from the same period last year. This represents the 16th consecutive quarter of year-over-year revenue growth, a testament to Light & Wonder’s strong operational execution across its gaming, SciPlay, and iGaming segments.

iGaming and SciPlay show diverging trends:

The company’s gaming revenue surged 4% to $495 million, driven by solid performance in table products, gaming systems, and gaming operations. Notably, table products experienced a 9% growth, while gaming systems and operations grew by 5% each. The North American market remained a key driver, with gaming operations benefiting from a 9% increase in the installed base of machines, reaching 34,501 units. The company also maintained its top position in the Australian market, securing the #1 share in slot machine shipments.

The iGaming segment performed well, with a 4% increase in revenue to $77 million. This growth was fueled by strong momentum in North America and the expansion of Light & Wonder’s partner network. The iGaming platform also saw a record-breaking $25.2 billion in wagers processed during the quarter.

In contrast, SciPlay, the company’s social gaming division, experienced a slight decline in revenue. SciPlay’s revenue was $202 million, a 2% decrease compared to the previous year. Despite this, SciPlay outpaced the broader social casino market, with significant improvements in key metrics. Average revenue per daily active user (ARPDAU) increased by 5% to $1.06, reflecting strong engagement and monetization. The platform’s growing direct-to-consumer model, which contributed $27 million to the total revenue, was instrumental in driving a 3% increase in AEBITDA.

One of the major challenges discussed during Light & Wonder’s earnings call was the impact of recent U.S. tariffs on imported goods, which have placed additional duties on raw materials sourced from Asia. The company has implemented various strategies to mitigate the effects, including supplier diversification, adjusting supply chain operations, and negotiating better pricing with suppliers.

CEO Matt Wilson acknowledged the evolving nature of the tariff situation, noting that the company was actively managing the issue with a balanced approach. “It’s a moving target,” Wilson said in the company’s press release, highlighting the complexity of navigating the impact of tariffs, which could change “by the day, the hour, or the tweet.” Despite these hurdles, Light & Wonder remains confident that its operational efficiencies, combined with ongoing cost-control initiatives, will enable the company to meet its ambitious $1.4 billion AEBITDA target for 2025.

Financial performance and capital allocation:

The company’s financial results for the first quarter also reflect strong operational efficiency. Adjusted EBITDA reached $311 million, marking an 11% year-over-year increase. The company’s solid performance was underpinned by effective capital allocation and a focus on margin expansion. Free cash flow grew by 19% to $111 million, driven by higher earnings and lower capital expenditures compared to the previous year.

Light & Wonder’s strategic initiatives also included a share repurchase program, during which the company bought back approximately 1.9 million shares for $166 million. These efforts demonstrate the company’s commitment to delivering value to shareholders, even as it navigates global economic challenges.

Looking ahead, Light & Wonder remains focused on expanding its footprint in key markets. The company continues to benefit from its diversified product portfolio, which includes its popular gaming franchises and innovative content strategy. Wilson highlighted the company’s robust pipeline of new game launches and franchise expansions, as well as its growing footprint in the iGaming space.

One of the key growth drivers for Light & Wonder in 2025 is its pending acquisition of Grover Gaming, a leading provider of electronic pull-tab games. The $850 million acquisition, expected to close in the second quarter of 2025, will bolster Light & Wonder’s charitable gaming division and provide access to new markets in North America.