Light & Wonder (LNW) Q2 2026 earnings summary

Executive summary

• Consolidated revenue for Q2 2026 rose 2% year-over-year to $828 million, with net income up 26% to $120 million and EPSA at $1.99, a 26% increase year-over-year.

• Growth was driven by strong performance in Gaming operations, iGaming, and Grover, each delivering double-digit year-over-year revenue increases, while SciPlay revenue declined 9%.

• Recurring revenue rose 6% year-over-year to $580 million, now representing 70-71% of consolidated revenue, supporting earnings stability.

• Margin expansion and disciplined capital allocation led to robust cash flow generation and continued share repurchases, with $134 million returned to shareholders in Q2.

• Adjusted free cash flow conversion improved to 41%, up 1,100 basis points year-over-year.

Financial highlights

• Consolidated AEBITDA for Q2 2026 was $383 million, up 9% year-over-year, with margin expanding to 46%.

• Adjusted NPATA grew 16% to $156 million; adjusted free cash flow was $156 million, up 50% year-over-year.

• Net cash from operating activities was $241 million, up 127% year-over-year.

• Net debt leverage ratio at 3.4x, with $5.2 billion in principal debt and $928 million in available liquidity.

• Capital expenditure was $83 million in Q2, about 10% of consolidated revenue.

Outlook and guidance

• Reaffirmed mid to high single-digit consolidated AEBITDA growth for full year 2026, with earnings expected to be weighted toward the second half.

• Targeting net debt leverage below 3.0x in H1 2027, aiming for investment-grade profile.

• Buyback activity expected to slow in the second half as focus shifts to deleveraging.

• Guidance incorporates external risks such as U.S. tariffs, U.K. iGaming tax changes, and legal costs.