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Brightstar pledges cost reductions as revenue rise fails to halt Q2 net loss

Steve Tyler Free Content

Brightstar pledges cost reductions as revenue rise fails to halt Q2 net loss

Summary

Brightstar Lottery reported a mixed Q2: group revenue rose 3% year‑on‑year to $631m, but higher costs and post‑split adjustments led to a net loss attributable to the company of $58m. The business is now operating standalone following the sale and restructuring around IGT’s Gaming & Digital business, and Brightstar has expanded its OPtiMa 3.0 cost‑reduction programme to $50m to “right‑size” the operation.

Content summary

For the three months to 30 June, Brightstar recorded $631m in revenue, driven by a 59% jump in product sales to $42m while service activity remained flat at $588m. Regional performance varied: US & Canada generated $293m (down 4%), Italy rose 10% to $259m, and rest of world grew 9% to $79m. Brightstar also secured an extension to run the Italian lottery through November 2034.

Despite revenue gains, operating expenses rose 13% to $492m and non‑operating costs spiked — partly due to foreign exchange losses and costs tied to the OPtiMa 3.0 programme. The quarter produced a pre‑tax loss of $10m (versus a $127m pre‑tax profit in Q2 2024). After discontinued operations and other items, the headline net loss attributable to Brightstar was $58m. Adjusted EBITDA for the quarter was $274m, down 5% year‑on‑year.

For the six months to 30 June, revenue fell 4.7% to $1.21bn, adjusted EBITDA declined 15% to $524m, and bottom‑line net loss attributable to Brightstar was $31m (versus a $123m profit in H1 2024) after discontinued operations adjustments.

Key Points

  • • Q2 revenue rose 3% to $631m, aided by a 59% increase in product sales.
  • • Operating expenses climbed 13% to $492m; non‑operating costs surged due to FX and restructuring items.
  • • Pre‑tax result: $10m loss (Q2 2024: $127m profit); net loss attributable to Brightstar: $58m.
  • • OPtiMa 3.0 cost‑reduction programme expanded to $50m to “right‑size” the standalone lottery business.
  • • Adjusted EBITDA for Q2 was $274m (down 5%); H1 adjusted EBITDA $524m (down 15%).
  • • Regional mix: US & Canada $293m (‑4%), Italy $259m (+10%), rest of world $79m (+9%).
  • • The IGT Gaming & Digital sale to Apollo ($6.3bn) completed in July; Brightstar now operates independently.

Why should I read this?

Because if you follow the lottery or broader gaming sector, this is a tidy snapshot of how post‑split companies perform under pressure. Brightstar has revenue momentum but is being nailed by costs — and management is cutting hard. Short version: revenue isn’t enough right now, cost control is the story.

Context & relevance

The results matter to investors, operators and suppliers in the lottery ecosystem. The IGT divestment and Apollo deal reshuffle market dynamics; Brightstar’s moves to reduce structural costs and secure long‑term contracts (notably in Italy) show how legacy businesses are repositioning after major M&A. Watch margins, OPtiMa savings delivery and regional sales mix for signs of a sustained recovery.

Source

Source: https://igamingbusiness.com/finance/quarterly-results/brightstar-revenue-rise-q2-net-loss/