Light & Wonder (LNW) Q3 2026 earnings summary

Executive summary

• Q3 revenue fell 2% to $824 million, while net income rose 17% to $133 million and Consolidated AEBITDA rose 2% to $383 million.

• Gaming operations and iGaming growth partly offset Gaming systems and SciPlay softness; recurring revenue reached ~71% of 9M revenue.

• 9M revenue rose 1% to $2.44 billion; management expects FY26 AEBITDA growth toward the lower end of prior guidance.

Financial highlights

• Q3 diluted EPS was $1.72 versus $1.34; Adjusted NPATA rose 7% to $163 million and EPSa rose 17% to $2.12.

• 9M Adjusted NPATA rose 7% to $435 million; EPSa increased 18% to $5.56.

• Q3 operating cash flow rose 28% to $236 million; adjusted free cash flow rose 21% to $181 million.

• 9M adjusted free cash flow was $545 million versus $365 million, with 50% conversion of Consolidated AEBITDA versus 35%.

• Q3 capital expenditures were $90 million; 9M capital expenditures were $247 million, primarily supporting Gaming operations growth.

Outlook and guidance

• FY26 Consolidated AEBITDA growth is expected toward the lower end of the prior mid-to-high-single-digit range; Adjusted NPATA and EPSa are expected to grow faster.

• FY26 Gaming systems revenue is expected to decline in the mid-teens; SciPlay growth is expected below category forecasts, and iGaming growth is expected to moderate amid international headwinds.

• Leverage is targeted toward 3.0x by FY26-end and below 3.0x during 1H27; FY28 targets include $2.0 billion Consolidated AEBITDA and EPSa above $10.55.

• Gaming machine shipments are expected to accelerate in Q4; R&D and capital expenditures remain targeted at ~17% of consolidated revenue.

• FY26 modeling parameters include 6%-7% effective interest cost, 22%-24% effective tax rate and quarterly corporate costs in the mid-to-high $30 million range.