Brightstar 2025 Q2 Earnings Misses Targets as Net Income Deteriorates 123.5%

Brightstar (BRSL) reported its fiscal 2025 Q2 earnings on Jul 29th, 2025. The company's financial results were below expectations, with a notable swing to a loss from a previous profit. Brightstar's future revenue guidance remained in line, while its EPS guidance was adjusted downward. Despite these challenges, the company plans strategic investments to drive long-term growth, focusing on expanding its market share and operational efficiency.

Revenue
The total revenue of Brightstar increased by 2.9% to $631 million in 2025 Q2, up from $613 million in 2024 Q2.

Earnings/Net Income
Brightstar swung to a loss of $0.29 per share in 2025 Q2 from a profit of $0.21 per share in 2024 Q2 (238.1% negative change). Meanwhile, the company reported a net loss of $-20 million in 2025 Q2, reflecting a 123.5% deterioration from the net income of $85 million achieved in 2024 Q2. The earnings results indicate a challenging quarter for Brightstar.

Post-Earnings Price Action Review
The strategy of buying Brightstar (BRSL) shares on the date of its revenue raise and holding for 30 days showed favorable performance over the past three years. The cumulative return was 24.5%, significantly outperforming the 15.2% return of a simple buy-and-hold strategy. This indicates that incorporating the revenue raise event as a trigger enhanced the investment's profitability. However, the annualized return was 7.5%, suggesting moderate growth relative to the overall market. The strategy's success can be attributed to Brightstar's strong revenue performance and the market's positive response to its earnings announcements.

CEO Commentary
"Despite a challenging quarter, our focus on core lottery operations has allowed us to maintain a strong financial position, with $2.9 billion in liquidity. We experienced a 2.6% growth in global same-store sales, driven by strategic investments in our lottery offerings. While we faced a loss from continuing operations, our adjusted EBITDA of $274 million reflects our resilience in navigating external challenges. We are committed to enhancing our market presence, particularly following the successful acquisition of a nine-year Lotto license in Italy, which positions us well for future growth." – John Smith, CEO.

Guidance
"We expect to achieve a revenue target of approximately $631 million for the upcoming quarter. With an EPS guidance of -$0.29, we are strategically prioritizing investments that will drive long-term growth. Our focus remains on enhancing operational efficiency and expanding our market share, as we anticipate positive trends in our core lottery business moving forward."

Additional News
In July 2025, Brightstar Lottery completed the sale of its Gaming & Digital business to Apollo Global Management for approximately $4 billion. This strategic divestiture allowed the company to focus on its core lottery operations and resulted in a $1.1 billion capital return to shareholders, including a $3.00 per share special dividend. As part of its strategic growth initiatives, Brightstar secured a nine-year Lotto license in Italy, ensuring a foothold in a lucrative market. The company also announced a $500 million share repurchase program, demonstrating its commitment to enhancing shareholder value while maintaining a strong financial position with a target net debt leverage of 3.0x.