Brightstar Lottery reports $607m revenue in third quarter 2026
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Brightstar Lottery reported third-quarter 2026 revenue of $607m, down 4% from $629m a year earlier. Adjusted EBITDA was $289m, compared with $294m, while continuing-operations profit fell to $45m from $95m; chief executive Vince Sadusky said revenue and earnings met expectations.
Brightstar Lottery reported Q3 2026 revenue of $607m, down 4% from $629m a year earlier. Higher amortisation of service revenue linked to the new Italian Lotto concession was the main factor in the revenue decline, while product sales and service activity supported operating performance.
Adjusted EBITDA fell to $289m from $294m in Q3, although its margin rose to 47.5% from 46.7%. Continuing-operations profit fell 53% to $45m from $95m in Q3 2025. Diluted earnings per share from continuing operations fell to $0.12 from $0.29, while the adjusted figure was $0.10, down from $0.36 a year earlier. Chief executive Vince Sadusky said revenue and earnings met the company's expectations.
Product sales rose 137% to $60m in Q3 from $25m a year earlier, including distribution network hardware, software and instant lottery tickets. Other service revenue increased 11% to $121m from $109m, mainly due to software work on new and extended contracts outside the US and Italy. Expansion of Italian B2C activities supported results. Brightstar said lower same-store sales, particularly because of US multistate lottery jackpots, the UK service contract transition and currency movements weighed on results alongside the Lotto amortisation.
Amortisation of upfront licence fees rose to $99m in Q3 2026 from $53m a year earlier. For the first nine months, the figure increased to $300m from $154m. The company said its share of the after-tax impact on earnings was $43m, or $0.23 per share, in the quarter, compared with $23m, or $0.12 per share, in 2025.
Italian revenue declined 19% to $208m in Q3 from $257m a year earlier, or 18% at constant currency. Italian same-store sales of instant and draw games fell 1.2%, compared with growth of 6.1% in Q3 2025. Italian same-store revenue, including contract mix effects, declined 1.4%. US and Canadian revenue fell 1% to $301m from $304m a year earlier. Revenue in the rest of the world rose 42% to $98m from $69m. Worldwide same-store sales of instant and draw games fell 1%, while sales associated with US multistate jackpots declined 30.6%.
Q3 adjusted EBITDA fell 2% year on year, despite support from product sales, margin mix and operating efficiencies. Those gains partly offset lower same-store takings, investment in growth initiatives and the UK contract transition. Chief financial officer Max Chiara said debt was within the company's target range and it remained committed to returning capital to shareholders.
Revenue for the first nine months of 2026 fell 4% to $1.778bn from $1.843bn a year earlier. Adjusted EBITDA rose 5% to $861m from $818m, supported by product sales, improved margins and efficiencies from the OPtiMa programme. Nine-month continuing-operations profit rose to $164m from $43m a year earlier. The increase was mainly due to non-cash effects of euro-dollar exchange movements on debt, a lower effective tax rate and a tax benefit recorded in Q2.
Net debt stood at $3.842bn on 30 September 2026, up from $2.723bn at the end of 2025. The increase reflected the final €1.43bn payment for the Italian Lotto concession, equivalent to about $1.67bn, made during the year. Net debt was 3.30 times adjusted EBITDA. Available liquidity at 30 September was $1.9bn, including about $538m in cash and $1.3bn in unused financing capacity. Operating cash flow was positive $73m in Q3, compared with an outflow of $445m a year earlier. Free cash flow was negative $8m, compared with negative $509m a year earlier.
Brightstar reduced its 2026 revenue forecast to $2.435bn to $2.455bn from $2.50bn to $2.55bn. The revised forecast accounts for second-half same-store sales, the timing of Italian B2C expansion initiatives and currency effects. It includes about $175m in additional service revenue amortisation linked to the Italian Lotto concession. The company cut its 2026 adjusted EBITDA forecast to $1.14bn to $1.16bn from $1.16bn to $1.19bn, mainly because of revised exchange-rate assumptions. Brightstar maintained its operating cash flow forecast of about $750m excluding the Lotto concession payment. Including that payment, it expects a full-year net operating cash outflow of about $900m. Capital expenditure is forecast at about $450m, compared with the previous range of $450m to $475m.
Brightstar allocated more than $200m to dividends and share buybacks from the start of the year through 9 November. In September, the group issued €500m in secured senior notes with a 4.875% coupon, maturing in September 2032. The proceeds were used mainly to repurchase some notes due in 2028, repay revolving credit borrowings and cover transaction costs. The board declared a quarterly dividend of $0.23 per share, with a record date of 24 November and payment scheduled for 8 December 2026.