Brightstar Lottery (BRSL) Q1 2025 earnings summary

Executive summary

• Q1 2025 results showed resilient profit and sustained global demand for instant and draw games, with normalized same-store sales up 1.4–1.5% and iLottery sales up over 25% year-over-year, despite lower U.S. jackpot activity and product sales timing shifts.

• Adjusted EBITDA was $250 million at a 42.8–43% margin, with strong cash conversion and liquidity, highlighting a resilient profit structure.

• Strategic initiatives included the $5 Mega Millions launch, retail network expansion, technology upgrades, and a focus on product innovation and iLottery adoption.

• Innovation and new product launches, especially in Italy and the U.S., drove growth, with iLottery penetration rising notably in Kentucky and Georgia.

Financial highlights

• Q1 2025 revenue was $583 million, down 12% year-over-year, mainly due to lower U.S. jackpot activity and LMA incentives, with a $45 million impact.

• Adjusted EBITDA was $250 million, down 24% year-over-year; margin declined to 42.8% from 49.5%.

• Free cash flow was $92 million, up from $30 million in Q1 2024; net cash from operating activities was $168 million.

• Net debt increased to $5.0 billion, with a pro forma net debt leverage of 2.8x.

Outlook and guidance

• Full-year 2025 revenue is expected at approximately $2.55 billion and adjusted EBITDA at $1.1 billion, both at the low end of prior guidance due to jackpot and macro headwinds.

• Q2 2025 revenue is expected to be flat to slightly up, with adjusted EBITDA down by about $30 million due to lower LMA incentives and ongoing investments.

• Cash from operations projected to be a use of ~$350 million, mainly due to Italy Lotto license fee payments and FX impact.