Stockholders' Equity

9 Months Ended

Sep. 30, 2023

Changes in Stockholders’ Equity (Deficit)

The following tables present certain information regarding our stockholders’ equity as of September 30, 2023 and 2022:


	Nine Months Ended September 30, 2023
	Common Stock		Additional Paid in Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Loss		Noncontrolling Interest		Total
January 1, 2023	$	1	$	1,370	$	517	$	(580)	$	(318)	$	171	$	1,161
Settlement of liability awards	—		25		—		—		—		—		25
Vesting of RSUs, net of tax withholdings and other	—		(14)		—		—		—		—		(14)
Purchase of treasury stock	—		—		—		(28)		—		—		(28)
Purchase of SciPlay’s Class A common stock	—		(8)		—		—		—		—		(8)
Stock-based compensation	—		15		—		—		—		—		15
Net income	—		—		22		—		—		5		27
Other comprehensive income	—		—		—		—		6		—		6
March 31, 2023	$	1	$	1,388	$	539	$	(608)	$	(312)	$	176	$	1,184
Vesting of RSUs, net of tax withholdings and other	—		1		—		—		—		—		1
Purchase of treasury stock	—		—		—		(5)		—		—		(5)
Purchase of SciPlay’s Class A common stock	—		(15)		—		—		—		—		(15)

Stock-based compensation	—		13		—		—		—		—		13
Net (loss) income	—		—		(1)		—		—		6		5
Other comprehensive income	—		—		—		—		47		—		47
June 30, 2023	$	1	$	1,387	$	538	$	(613)	$	(265)	$	182	$	1,230
Vesting of RSUs, net of tax withholdings and other	—		3		—		—		—		—		3
Purchase of treasury stock(1)	—		—		—		(113)		—		—		(113)

Stock-based compensation	—		12		—		—		—		—		12
Net income	—		—		75		—		—		5		80
Other comprehensive loss	—		—		—		—		(66)		—		(66)
September 30, 2023	$	1	$	1,402	$	613	$	(726)	$	(331)	$	187	$	1,146

(1) Includes excise taxes of $1 million for the three and nine months ended September 30, 2023.


	Nine Months Ended September 30, 2022
	Common Stock		Additional Paid in Capital		Retained Earnings (Accumulated Loss)		Treasury Stock		Accumulated Other Comprehensive Loss		Noncontrolling Interest		Total
January 1, 2022	$	1	$	1,337	$	(3,158)	$	(175)	$	(261)	$	150	$	(2,106)
Settlement of liability awards	—		43		—		—		—		—		43
Vesting of RSUs, net of tax withholdings and other	—		(31)		—		—		—		—		(31)
Purchase of treasury stock	—		—		—		(51)		—		—		(51)
Stock-based compensation	—		17		—		—		—		—		17
Net income	—		—		26		—		—		2		28
Other comprehensive loss	—		—		—		—		(37)		—		(37)

March 31, 2022	$	1	$	1,366	$	(3,132)	$	(226)	$	(298)	$	152	$	(2,137)
Vesting of RSUs, net of tax withholdings and other	—		—		—		—		—		—		—
Purchase of treasury stock	—		—		—		(152)		—		—		(152)
Purchase of SciPlay’s Class A common stock	—		(6)		—		—		—		(1)		(7)
Stock-based compensation	—		15		—		—		—		—		15
Net income	—		—		3,291		—		—		4		3,295
Other comprehensive loss(1)	—		—		—		—		(48)		—		(48)
June 30, 2022	$	1	$	1,375	$	159	$	(378)	$	(346)	$	155	$	966
Vesting of RSUs, net of tax withholdings and other	—		(3)		—		—		—		—		(3)
Purchase of SciPlay’s Class A common stock			(10)								(1)		(11)
Stock-based compensation	—		14		—		—		—		—		14
Net income	—		—		328		—		—		7		335
Other comprehensive loss(1)	—		—		—		—		(69)		—		(69)
September 30, 2022	$	1	$	1,376	$	487	$	(378)	$	(415)	$	161	$	1,232

(1) Includes reclassifications of $51 million and $74 million for the three and nine months ended September 30, 2022, respectively, from accumulated other comprehensive loss into income due to the sales of discontinued operations (see Note 2).

Stock-based Compensation

The following reflects total stock-based compensation expense recognized under all programs:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Related to L&W stock options	$	—	$	—	$	—	$	1
Related to L&W RSUs	19		12		59		39
Related to SciPlay RSUs	12		3		26		7
Total(1)	$	31	$	15	$	85	$	47

(1) Includes $19 million and $45 million classified as liability awards for the three and nine months ended September 30, 2023, respectively, and $6 million and $16 million for the three and nine months ended September 30, 2022, respectively.

Restricted Stock Units

A summary of the changes in RSUs outstanding under our equity-based compensation plans during the nine months ended September 30, 2023 is presented below:


	Number of Restricted Stock Units	Weighted Average Grant Date Fair Value
Unvested RSUs as of December 31, 2022	1.7	$	46.66
Granted	1.1	$	57.54
Vested	(1.0)	$	44.52
Cancelled	(0.1)	$	50.43
Unvested RSUs as of September 30, 2023	1.7	$	54.66

The weighted-average grant date fair value of RSUs granted during the nine months ended September 30, 2023 and 2022 was $57.54 and $57.26, respectively. The fair value of each RSU grant is based on the market value of our common stock at the time of grant. As of September 30, 2023, we had $58 million in total unrecognized stock-based compensation expense relating to unvested RSUs that will be amortized over a weighted-average period of approximately two years. The fair value at vesting date of RSUs vested during the nine months ended September 30, 2023 and 2022 was $58 million and $72 million, respectively.

Series A Junior Participating Preferred Stock and Rights Agreement

The 2018 Amended and Restated Rights Agreement, as described in Note 17 of our 2022 10-K, expired on June 19, 2023. Immediately prior to its expiration, no shares of Series A Junior Participating Preferred Stock were outstanding and no preferred share purchase rights had been exercised. At the time of the expiration of the agreement, the preferred share purchase rights expired and are no longer outstanding.

Share Repurchase Programs

On March 1, 2022, our Board of Directors approved a share repurchase program under which we are authorized to repurchase, from time to time through February 25, 2025, up to an aggregate amount of $750 million of our outstanding common stock. During the nine months ended September 30, 2023, we repurchased 2.1 million shares of common stock under the program at an aggregate cost of $146 million (including excise tax).

On May 9, 2022, SciPlay’s Board of Directors approved a share repurchase program under which it is authorized to repurchase, from time to time through May 9, 2024, up to an aggregate amount of $60 million of its outstanding Class A common stock. On May 3, 2023, SciPlay’s Board of Directors approved another share repurchase program under which it is authorized to repurchase, from time to time through May 3, 2024, up to an aggregate amount of $60 million of its outstanding Class A common stock. During the nine months ended September 30, 2023, SciPlay repurchased 1.4 million shares of Class A common stock under the programs at an aggregate cost of $23 million. As described in Note 1, on October 23, 2023, we completed the SciPlay Merger, and upon its completion, the SciPlay share repurchase program was terminated.