Light & Wonder this week outlined plans to use Artificial Intelligence (AI) to improve the quality and scale of its gaming products, at the same time detailing the defensive strategy it has established to prevent industry rivals from using AI technology to encroach on its market position.
The AI strategy formed a central theme of Light & Wonder’s 4Q25 earnings call on Wednesday (Asia time), with President and CEO Matt Wilson revealing the company views AI through both a “defensive moat lens” and through an offensive lens.
On the defensive side, Light & Wonder believes its established position – including over 500 licenses globally, annual R&D spend of over US$500 million, unique IP brands like “Huff N’ Puff” and “Dancing Drums” and proven math models – provides the moat that can keep smaller competitors at bay.
“We do have strong and durable structural moats around this industry and around our business,” Wilson said during the earnings call. “We have strong established market positions. We’ve been building these positions for decades and we’re either #1 or #2 in all the markets that we operate in.
“We’ve got valuable IP and brands [that are] the Coca-Colas of the gaming industry. Players love them. They trust them … and they’re unique to us. They can’t be leveraged by competitors or start-ups entering the space.”
Wilson added that the company’s math models, data sets and proprietary cabinets are now well and truly established and can’t be replicated by a few quantitative analysts using a Large Language Model.
“These are things that are built over time, so yes, through my perspective, we have massive structural moats around the Gaming business, and that will persist over time, and AI will be a massive opportunity for us.”
Light & Wonder will, however, also “go on the offensive” from a growth and productivity standpoint, leveraging across three different areas.
These are to include using technology to accelerating new platform development and technical debt reduction through AI-assisted architecture, code generation, test automation and security reviews. On the content side, the company wants to focus on improved quality, hit rate and quantum of games – targeting improvement in non-creative lead times such as localization and regulatory adaptation across jurisdictions, and driving more studio focus on concept to game polish.
And in business operations it will extend AI across sales enablement, customer support, supply chain optimization, predictive analytics, IT operations and more – unlocking margin improvement and operational scalability across the enterprise.
“Importantly to note for investors, we launched an AI transformation program in 2025,” Wilson said. “We intended to come to market and explain that to our investor base sometime in 2026, but we thought just given a lot of the anxiety in the market today, we wanted to give you a bit of a precursor to that. The Board is aligned around that transformation program, as is the management team, and we see significant opportunities.”
Victor Blanco, Light & Wonder’s Executive VP & Chief Technology Officer, pointed specifically to the company’s game development kit called “Carbon” – established last year as a completely AI-led platform development initiative offering a new development language and a brand-new game engine.
“Carbon is now delivering 100% game portability across land, social and web, where before we were just sitting at around 70%,” Blanco said.
“Our first Carbon land-based game is still on track for launch this year, and we’ve aggressively pulled in our first iGaming Carbon game into 2026 as well, just given the confidence of what we’re seeing. And now finally, because Carbon was developed entirely through AI-led methodologies, these same tools, the workflows and all the productivity gains that we’re seeing in the platform are going to carry forward directly into our studios as they adopt Carbon as their basis for building games.”
Light & Wonder explained that it sees AI as a tool from which to achieve its ambitious growth targets through 2028, where it has set an EBITDA target of US$2 billion. The company achieved its 2025 target of US$1.4 billion, reporting this week annual EBITDA of US$1.44 billion for the year.
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