Evolution CEO calls Brazil betting ban a 'total negative' as studio stays closed pending court ruling

Evolution CEO Martin Carlesund has described Brazil's ban on licensed betting as a "total negative" for the industry, saying the supplier is waiting for clarity on how the situation will develop. He spoke to analysts on the company's call following its third-quarter results.

In late September, President Luiz Inácio Lula da Silva announced a ban on gambling in Brazil, less than two years after the regulated online market opened. The suspension came into force in early October. As a result, Evolution has temporarily closed the São Paulo studio it launched last year. Carlesund said the facility could reopen at short notice and that Evolution would be "ready to accelerate" in Brazil if that happens. The market is now waiting for a ruling from the Supreme Federal Court on whether the ban is unconstitutional.

Carlesund said "everyone is flabbergasted" by the situation and called it unfortunate that a populist agenda could overturn a framework in place for only a year and a half. Asked whether Brazilian revenue would fall to zero if the ban stayed, he said the country is not ring-fenced and that no one knows what will happen. Evolution kept its full-year margin guidance, and Carlesund said the outlook was unchanged even if Brazil produced no revenue in the fourth quarter. LatAm revenue grew 23.1% year on year in Q3, a figure that does not reflect the suspension.

Group net revenue rose 3.7% year on year to €526.1 million, and adjusted EBITDA increased 2.7% to €345.9 million. It was the first quarter since 2024 in which every region grew quarter on quarter. Africa rose 23.7% and North America 13.6% year on year, while Europe declined 4.7% year on year and grew just 0.4% on the quarter. Carlesund called the European result "not exciting" and said Evolution "should do better", suggesting that regulatory changes and taxes were distracting from work with customers.

On Asia, where Evolution has said its products are being stolen through cyberattacks on its distribution, revenue rose 0.8% quarter on quarter and 1.6% year on year. Carlesund said there is no quick fix, but that the company is making technical progress and playing the long game.

He declined to say much about the lawsuit with Playtech, which stems from a 2020 Black Cube investigation commissioned by Playtech. He said only that the case continues and that new steps are taken every day.