IGT sees 300% online revenue boost
Interactive revenues hit $144m " Entraction closure causes $15m setback.
International Game Technology (IGT) saw revenues from its interactive business increase by some 293% to US$144m in 2012 compared to the previous year, the company has announced in its financial results for the year ended 30 September 2012.
Total revenues for the year increased by 10% to $2.15bn following a strong fourth quarter which saw significant revenue boosts in both online and social gaming.
The acquisition of social game developer DoubleDown Interactive has started to bear fruit, with social gaming revenues in the fourth quarter increasing by 20% from Q3 to $36m ($87m for the year), primarily driven by an increase in both daily active users (DAU) and bookings per DAU. DAUs were 1.4 million in the fourth quarter, an increase of 4% compared to Q3.
IGT, which in June became one of the first companies to obtain an online poker licence in Nevada, acquired DoubleDown Interactive for up to US$500m in January.
During the final quarter the gaming machine manufacturer announced the closure of the Entraction poker network it acquired for approximately £70m in May 2011 due to “change and uncertainty in European market conditions [diminishing] the expected returns”. The decision to shut down the network led to $15m in reorganisation costs.
As well as its traditional B2C slot and games machine business “ in which sales increased by 22% year-on-year to $313m in the fourth quarter “ IGT has recently announced a raft of North American casino clients to integrate the freeplay DoubleDown Casino app onto their proprietary websites in a revenue sharing agreement.
Last month it announced it had signed up a further 15 casinos in addition to the four it announced earlier in the year, including Hard Rock Hotel & Casino in Vegas, Jacobs Entertainment casinos and Casino Del Sol Resort in Arizona.
Revenues from real-money online gaming, meanwhile, reached $56.9m in fiscal 2012, a year-on-year increase of 55%.
IGT CEO Patti Hart said the interactive business is “gaining traction at an accelerating rate” and that “the pieces [are] in place to generate significant value for shareholders now and into the future”.
“At DoubleDown, the world’s largest social casino, we expect to launch a more complete mobile product. We expect to add localised content for the international market and to leverage even more of our proven IGT brands and game content,” she said.
“In our IGTi group, we expect to see continued growth in our mobile, real-money wagering business, consistent with our past trends.”