IGT revenues fall 15% despite DoubleDown growth
Impressive increase in DoubleDown Interactive revenues fails to arrest decline in group performance as plans to bolster mobile platform accelerate
International Game Technology (IGT) has posted revenues of US$513m (£305m) for the second quarter of 2014, a 15% year-on-year decrease despite considerable growth in its social casino business DoubleDown Interactive.
Total revenues from DoubleDown were up 27% to $68.8m (£41m) for the three-month period compared with Q2 last year, while its real-money division IGTi generated $11m (£6.5m).
The increase was attributed to a rise in the number of players signing up through DoubleDown’s mobile platform following several upgrades and improvements over recent months.
“The progress we’ve made in mobile is largely a result of the effort we put behind improving our mobile products, and kudos to the DoubleDown mobile team up in Seattle because they’ve put a lot of time and energy into both ensuring stability on the system, but also introducing new products,” said IGT’s chief financial officer John Vandemore.
“If you played the game a year ago and you look at it today on mobile there is almost no resemblance, with a dramatically improved interface and product selection. I think that, coupled with the notion that certainly mobile game play is where the growth is in the market, has really led to the outsized growth in mobile bookings we’ve seen,” he added.
During the period Active Daily Users (ADU) increased 5% from 1.7m in 2013 to 1.8m, while Bookings per Daily User grew 16% to $0.43.
IGT will continue to grow its social casino business following the appointment of former Amazon VP Will Dougherty as general manager, with plans to launch a social version of its popular Wheel of Fortune branded slot game by the end of the year having recently renewed its licensing agreement with Sony.
Last month, sister-title eGR North America reported that IGT would cull 7% of its global workforce in a bid to realise cost savings of $30m by the end of the fiscal year, and an estimated $50m on an annual run-rate basis following a poor performance from its North America business.
“During the quarter, we took decisive action to reduce IGT’s cost structure and position the company for long-term earnings growth,” said Patti Hart, CEO of IGT.
“Looking forward, we are confident that we will be able to leverage our leaner cost structure, substantial R&D investments and premium brands to drive shareholder value,” she added.