Evolution UK Operations Unchanged After £4.75m Settlement

Evolution Says UK Operations Unchanged After £4.75 Million Gambling Commission Settlement – Q2 Revenue Declines Despite Regional Growth

Key Takeaways

• Evolution will pay £4.75 million following a UK Gambling Commission investigation into content appearing on six unlicensed websites.
• CEO Martin Carlesund stated the settlement will not lead to changes in the company’s UK operations.
• Group net revenue declined 1.2% year-on-year in Q2 to €517.8 million, with EBITDA falling to €341 million.
• Europe returned to quarter-on-quarter growth, while Asia posted a 3.7% revenue decline linked to increased cybercrime activity.
• The proposed $85 million acquisition of Galaxy Gaming may lapse as the closing period expires.

UK Settlement Concludes Investigation Into Unlicensed Distribution

Evolution has reached a regulatory settlement with the UK Gambling Commission following an investigation that began in December 2024. The regulator found that Evolution’s content had been made available through two operators on six unlicensed websites. As part of the agreement, Evolution will pay £4.75 million, equivalent to approximately $6.4 million.

Speaking during the company’s Q2 earnings call, CEO Martin Carlesund said the settlement would not result in operational changes in the United Kingdom. He stated that there are no adjustments planned to the company’s current way of doing business in the UK.

For operators and platform users in the UK market, this confirms that Evolution’s live casino and gaming content will continue to be supplied under existing arrangements. The case focused on distribution controls rather than a suspension or restriction of licensed activity.

CEO Comments on Gambling Taxation and Channelisation

During the earnings call, Carlesund also addressed the broader regulatory environment in Europe, including recent tax increases. In the UK, the Remote Gaming Duty nearly doubled from 21% to 40% on 1 April this year.

Carlesund said that higher gambling taxes can reduce channelisation, referring to the share of players using regulated platforms instead of unlicensed alternatives. He cited examples including the UK and the Netherlands, where channelisation has reached 50%.

He added that regulatory decisions on taxation are made by authorities and that Evolution acts in accordance with existing rules. The comments were made in the context of discussing regulatory balance rather than announcing specific operational changes.

For users of licensed platforms, channelisation levels can influence product availability, pricing structures, and the competitive landscape between regulated and offshore operators.

Q2 Results Show Regional Divergence in Revenue Performance

Evolution reported net revenue of €517.8 million in the second quarter, representing a 1.2% decline compared with the same period in 2025. EBITDA decreased to €341 million from €345.3 million a year earlier.

For the first half of the year, net revenue fell 1.4% to €1.038 billion. EBITDA for the period declined to €676.3 million from €687.2 million in the previous year.

Despite the overall decline, regional trends varied. Europe, described by Carlesund as the company’s main headache in recent quarters, returned to quarter-on-quarter growth in Q2. Revenue in the region increased 3.5% compared with Q1.

Latin America delivered the strongest year-on-year growth rate, with revenue up 26.3%. North America also recorded growth, with revenue rising 9.5% compared with the same period last year.

In contrast, Asia experienced a 3.7% quarter-on-quarter revenue decline. The company linked this decrease to increased cybercrime activity in the region.

According to the Q2 presentation, 37% of Evolution’s net revenue was generated from customers’ players’ IP addresses in Asia, 33% from Europe, and 16% from North America. This geographic distribution highlights Asia as the largest contributor to group revenue during the period.

Carlesund stated that revenue and margin trends improved compared with the first quarter, while cost control remained strong and cash flow improved. He also noted ongoing expansion in key markets and continued execution of the company’s product roadmap.

Galaxy Gaming Acquisition Faces Expiry of Closing Period

In July 2024, Evolution announced an agreement to acquire all outstanding shares of Galaxy Gaming, a specialist in table games and casino technology. The transaction was valued at approximately $85 million.

The closing period for the deal expires on Friday. From that point, either party may terminate the agreement. The acquisition has encountered regulatory challenges in the United States during the approval process.

Carlesund stated that the transaction is not significant for Evolution due to Galaxy Gaming’s size. He said that the outcome would have no material impact on Evolution’s existing business, its US operations, or its long-term ambitions.

For US-facing operators and platforms, this indicates that Evolution does not view the potential termination of the deal as a factor that would alter its current product offering or market strategy in North America.

Our Assessment

Evolution has concluded a UK regulatory investigation with a £4.75 million settlement and confirmed that its operational approach in the UK will remain unchanged. Financial results for Q2 show a modest year-on-year decline in revenue and EBITDA, with regional growth in Europe, Latin America, and North America offset by a decline in Asia linked to cybercrime activity. The pending expiration of the Galaxy Gaming acquisition adds uncertainty to that transaction, although the company states that its overall business and US strategy are not materially affected.