Entain’s UK and Ireland operations demonstrated resilience during the third quarter of 2025, with both online and retail channels delivering year-on-year growth, though concerns remain regarding proposed tax changes in the region.
The gambling operator reported UK and Irish revenue rose 8% year-over-year compared to Q3 2024, driven by a 15% increase in online revenue and a 2% rise in retail operations. The retail growth continues a trend from Q2 and H1, marking a notable achievement given broader industry challenges in the UK retail betting sector.
Recent data from the Gambling Commission shows gross gambling yield figures for retail betting have declined, while the latest Gambling Survey for Great Britain indicates reduced retail betting participation. Despite this market-wide contraction, Entain’s retail division has maintained positive momentum across both sports and gaming categories.
Strong Group Performance Supports Full-Year Guidance
The company’s total group net gaming revenue, including its 50% share of BetMGM, increased 7% on a constant currency basis during Q3. Excluding the US market, group revenue grew 4%, with online revenue up 5% despite customer-friendly sports results in September that impacted performance by one to two percentage points.
Based on H1 and Q3 performance, Entain has reaffirmed its full-year 2025 guidance, projecting approximately 7% online net gaming revenue growth, online EBITDA of between £1.1 billion and £1.15 billion, and an accompanying margin of 25-26%.
Stella David, CEO of Entain Group, said during the company’s earnings call: “Entain’s transformation continues at pace, with our strategic execution and expanding bandwidth delivering growth across our portfolio. Whilst we still have more to do, our Q3 performance is further evidence of the quality of our diverse business and its underlying momentum.”
International Markets Deliver Mixed Results
The International division recorded 1% net gaming revenue growth, with online revenue up 1% and retail up 1%. Online volume growth of 5% was largely offset by customer-friendly sports results in September.
Double-digit online net gaming revenue growth was recorded across Austria, Canada, Georgia, Greece, Spain, and New Zealand, where Entain holds effective exclusive sports betting rights. Italian revenue increased 6%, while the Central and Eastern Europe division, anchored by SuperSport in Croatia, delivered 10% revenue growth with 9% online growth and 11% retail growth.
Brazil experienced an 11% decline in net gaming revenue due to adverse sports margins, though underlying betting volumes grew 14%.
BetMGM Exceeds Expectations, Plans Cash Distribution
Rob Wood, Group CFO and Deputy CEO, told investors the company is "delighted with the cash coming out of BetMGM." The joint venture’s Q3 net revenue reached $667 million, representing a 23% year-over-year increase on a constant currency basis.
BetMGM has raised its FY25 guidance to net revenue of at least $2.75 billion and EBITDA of approximately $200 million, up from previous guidance of at least $2.7 billion in net revenue and at least $150 million in EBITDA.
Adam Greenblatt, CEO of BetMGM, commented: “Strong underlying metrics and margin outperformance during July and August support our confidence in raising guidance for full year 2025. Furthermore, we have reached yet another inflection point in our journey, returning operating cash flow back to Entain and MGM Resorts.”
The joint venture plans to distribute at least $200 million in cash to its parent companies before the end of 2025.
Tax Uncertainty Clouds UK Outlook
While Entain’s UK performance remains robust, company leadership has expressed concern about potential tax increases that could impact the sector. The industry is closely watching the UK Budget announcement at the end of November, which represents a key area of uncertainty.
Wood noted during the earnings call that approximately a quarter of the online UK iGaming market comprises tier 3 and smaller operators, suggesting consolidation opportunities could emerge if material tax rate increases are implemented.
David stated earlier this month that the company may need to reconsider its UK investment if the Labour government implements significant gambling tax rises in its November Budget.
Strong Position for 2026 and Beyond
Looking ahead, Entain stated the group is well-positioned entering Q4 2025 and 2026. Wood confirmed that no known material adverse regulatory changes are expected in 2026, noting there will be no repeats of the Belgium and Netherlands regulatory impacts seen in previous periods.
The company’s focus on cash generation and strategic delivery supports its confidence in generating over £500 million of annual adjusted cash flow from 2028.
Jefferies analysts noted that Entain shares trade at 8.7 times EV/EBITDA on 2025 estimates and suggested approximately 60% upside to a £13 share price based on their revised sum-of-the-parts analysis.
Despite positive trading updates, Entain shares slipped 2.3% to 818.09p in early Wednesday trading in London, following the broader FTSE 100 index which dipped 0.1%.
Source: SBC News
