BUSINESS

IGT Q3 profit jumps 40% on 105% boost in DoubleDown Casino revenue

TAGs: DoubleDown Casino, IGT, international game technology, New Jersey Online Gambling, Patti Hart, social gaming

igt-doubledown-casino-patti-hartNevada-based gaming device maker International Game Technology (IGT) saw revenue rise 8.7% to $579m in ifs fiscal Q3 ending June 30, thanks in part to the growing strength of its social gaming division. Net income hit $65.7m, a 40% boost from the $46.6m in the same period last year, while earnings rose from $0.23 to $0.33 per share.

Slot machine sales rose 12% to $259.2m thanks to a 39% increase in North American replacement unit shipments, including 1,300 units in Illinois and 3,300 units north of the border in Canada. At the end of Q3, IGT had 56,700 machines in the market. If there was a downside to Tuesday’s report, it was in IGT’s gaming operations, where revenue fell 4% to $247.3m, which IGT CEO Patti Hart (pictured right) blamed on tight consumer spending.

While revenue from the DoubleDown Casino social gaming operations accounted for just $61.4m of IGT’s total tally, that figure represents a 13% rise from Q2 and a whopping 105% boost over Q3 2012. DoubleDown’s daily active users rose 25% to 1.7m during Q3, while average monthly active users rose 28% to 6.7m. Revenue per user rose 50% to 60 cents per day, which was a surprise to CFO John Vandermore, who told analysts that the company had expected some “downward pressure” on average revenue per user as DoubleDown expanded into more international markets. In addition to its ‘native’ tongue, DoubleDown is currently available in German, French, Spanish and Italian languages.

Vandermore also trumpeted the fact that DoubleDown was consistently ranking as the #3 highest-grossing app on Facebook, “not the #3 social casino app, but the #3 app overall.” DoubleDown, which hit the 10m download mark in Q3, recently passed Zynga Poker as the top-grossing social game on Facebook, while DoubleDown’s share of the overall social gaming market is only 1% behind Zynga’s. Hart told analysts that DoubleDown was generating monetization rates that “frankly are the envy of the industry, nearly double that of our nearest competitor.”

On the convergence front, this month saw DoubleDown add selected Century Casinos‘ websites to the growing list of brick-and-mortar casinos offering their customers the social casino experience. Vandermore also noted that IGT was “excited about new markets like New Jersey,” where IGT was focusing on “our prospects to partner with some of our land-based customers” in the state’s nascent online gambling market. Hart said IGT was “working with a whole host of folks who are preparing for that market to open.” Hart touted IGT’s progress toward becoming “a global gaming ecosystem that is ubiquitous across platforms and devices, where scale and breadth of product and broad distribution of content will matter.” Hart said IGT was “several years ahead, I think, of others when we really think about where the business is going.”

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