Light & Wonder Shifts Focus Away from Live Casino Operations

Light & Wonder has unveiled a significant development during its Q4 earnings call, announcing the decision to phase out its live casino operations, particularly within the United States.

In a comprehensive transcript made public, Light & Wonder’s CEO, Matt Wilson, elaborated on the company’s objective to remain nimble, which translates to being competitive amid the challenges they encounter. The company revealed that after conducting a strategic review, it would be discontinuing and divesting from its live casino segment.

Wilson emphasized that the company prioritizes profitability and robust returns, implying that not every business vertical is worth pursuing with the same intensity. During the earnings call, Wilson encapsulated the rationale behind the company’s decision:

‘While we’re still in the relatively early days of investing in the business, we strive to stay nimble as an organization and are thus focusing on the risk-reward profile of our other businesses, which have better visibility to superior returns relative to live casino.’

This implies that in the United States, companies like Playtech and Evolution are expected to remain the predominant providers of such content. However, other entities such as Pragmatic Play are also making inroads into the North American market.

Wilson further noted that the company is now channeling its efforts towards iGaming, highlighted by the recent appointment of Simon Johnson to spearhead the department. This growth strategy will be driven by a ‘regionalized’ approach, where each high-value market is targeted in a customized manner.

Brazil emerges as a pivotal future market for Light & Wonder, where Johnson’s leadership could prove to be invaluable.

Some Market Opportunities Will Be Forgone, But It’s Not Entirely Negative

• The challenge with the live casino segment is less about the market’s potential and more about the intrinsic difficulties in sustaining a strong momentum within that specific sector.
• Additionally, the anticipated returns are relatively modest compared to the effort required, as Wilson seemed to suggest.
• Ultimately, Light & Wonder opted to withdraw before the market forced their hand, seeing it as a preemptive move away from a strategy they deemed unviable.
• Though Light & Wonder will relinquish part of the available market, the company remains largely unconcerned and plans to reinvest any proceeds from asset sales back into its ongoing operations.