International Game Technology faces cybersecurity breach

Sankunni K November 20, 2024

SiGMA news

International Game Technology PLC (IGT), a global leader in gaming technology and operator of popular casino slot machines, has reported a significant cybersecurity breach that disrupted portions of its internal IT systems. In a with the Securities and Exchanges Commission (SEC) on Tuesday, the company confirmed that an unauthorised third party had accessed specific systems, prompting IGT to activate its cybersecurity incident response plan and seek assistance from external advisors.

The breach resulted in certain systems being taken offline, affecting operations to some extent. While IGT continues to investigate the incident and work to restore normalcy, management has not yet determined whether the breach is material to its financial standing. Communication with customers and stakeholders is ongoing to ensure transparency and mitigate disruptions.

This cyberattack comes at a challenging time for the gaming and gambling industry, which has been increasingly targeted by cybercriminals. Other major companies in the sector, including MGM Resorts International and Caesars Entertainment, faced notable breaches. In October 2023, MGM Resorts reported that a ransomware attack disrupted its systems for over a week, leading to revenue losses of approximately $100 million. Similarly, Caesars Entertainment disclosed that hackers accessed customer information, including Social Security and driver’s license numbers, with the company reportedly paying millions to resolve the issue.

IGT’s Q3 earnings: A mixed bag

The cybersecurity incident coincides with the company’s release of its third-quarter results on November 12. IGT reported revenue of $587 million, falling short of Wall Street’s expectations of $594.33 million. Adjusted earnings per share reflected a loss of $0.02, missing analysts’ forecasts of a $0.41 profit.

The revenue decline was primarily attributed to a significant 56 percent drop in U.S. multi-state jackpot wager-based revenue compared to the previous year. However, instant ticket and draw wager-based revenue provided a slight buffer with a 1 percent year-over-year increase.

Despite these setbacks, IGT remains optimistic about the remainder of 2024. The company projects Q4 revenue between $640 million and $690 million, exceeding market expectations of $632.04 million. For the full year, IGT forecasts revenue in the range of $2.5 billion to $2.55 billion, demonstrating confidence in its business resilience.

“Our third-quarter and year-to-date performance underscores the strength and resilience of our business model marked by our scale, attractive margin structure, and strong cash generation,” said Vince Sadusky, CEO of IGT, in the earnings announcement.

Additionally, IGT is proceeding with the sale of its Gaming & Digital business for $4.05 billion in cash, a move expected to close by the end of Q3 2025.

Industry implications

The breach at IGT highlights a growing trend of cyber threats targeting high-profile gaming and gambling companies, sectors often perceived as lucrative targets due to their vast financial transactions and customer data.

With hackers becoming more sophisticated, companies like IGT must bolster their cybersecurity defenses to protect critical infrastructure and customer information. IGT’s prompt response, including taking systems offline and seeking external expertise, aligns with best practices but underscores the need for proactive, rather than reactive, measures in an increasingly hostile cyber landscape.