Inspired(INSE) - 2025 Q4 - Annual Results

Financial Performance - Fourth quarter revenue reached $77.2 million, primarily driven by record Interactive revenue, which increased by 53% year-over-year[5] - Adjusted EBITDA for the fourth quarter was $32.3 million, up 5% from the prior year, resulting in a record Adjusted EBITDA margin of 42%[5] - The company reported a net loss of $7.2 million for the fourth quarter, compared to a net income of $67.0 million in the same period last year[5] - Total revenue for Q4 2025 was $77.2 million, a decrease of 6.9% compared to $83.0 million in Q4 2024[33] - Service revenue increased to $68.4 million in Q4 2025 from $64.7 million in Q4 2024, representing a growth of 5.7%[33] - Product sales decreased significantly to $8.8 million in Q4 2025 from $18.3 million in Q4 2024, a decline of 52.0%[33] - Adjusted Net Income per diluted share for Q4 2025 was $(0.25), compared to $2.29 in Q4 2024[33] - Net loss for the year ended December 31, 2025, was $17.0 million, a significant decline from a net income of $64.8 million in 2024[37] - Total revenue for the twelve months ended December 31, 2025, was $304.1 million, a slight increase from $297.1 million in 2024[47][48] - Adjusted EBITDA for 2025 was $111.4 million, compared to $100.1 million in 2024, reflecting a year-over-year growth of 11.9%[47][48] - Net loss for the twelve months ended December 31, 2025, was $17.0 million, an increase from a net income of $64.8 million in 2024[41][43] Segment Performance - Interactive segment revenue for the full year 2025 was $58.6 million, a 49% increase compared to $39.3 million in 2024[15] - The gaming segment contributed $112.3 million to total revenue in 2025, accounting for 36.9% of total revenue[47] - The sports segment generated $36.6 million in revenue, representing 12.0% of total revenue for 2025[47] - Adjusted EBITDA for the gaming segment was $55.0 million, while the sports segment reported $26.8 million in adjusted EBITDA for 2025[47] Debt and Cash Management - The company repaid approximately $13 million of debt and repurchased shares, strengthening its balance sheet[3] - Long-term debt increased to $345.2 million in 2025 from $292.2 million in 2024, representing an 18.1% rise[35] - The company incurred $365.7 million in proceeds from long-term debt in 2025, with repayments totaling $338.6 million[37] - Cash and restricted cash at the end of the period totaled $43.3 million, up from $29.3 million in 2024, reflecting a 47.8% increase[37] - Net cash provided by operating activities rose to $52.0 million in 2025, compared to $31.7 million in 2024, marking a 64.4% increase[37] Operational Changes and Future Outlook - The company plans to streamline its reporting structure by merging Gaming and Leisure into a single "Retail Solutions" segment starting in 1Q 2026[14] - The company expects first quarter 2026 Adjusted EBITDA to increase by at least 20% year-over-year, with full year 2026 Adjusted EBITDA projected to be between $112 million and $118 million[10] - The new Virtual Soccer BetBuilder product in Greece is already driving increases in total bet volume and gross win, with plans for broader rollout ahead of the 2026 World Cup[3] - The company expanded into South Africa and launched new customer Jenningsbet with 470 terminals installed in 4Q 2025[14] - The company remains focused on capital allocation to high-return opportunities while improving profitability and financial flexibility[9] - The company plans to host a conference call on March 10, 2026, to discuss financial results and business trends[26] - Forward-looking statements indicate expectations for future product launches and market expansion, though subject to risks and uncertainties[30] Cost Management - Selling, general and administrative expenses remained stable at $34.3 million in Q4 2025, slightly down from $34.4 million in Q4 2024[33] - Interest expense increased to $10.7 million in Q4 2025 from $8.8 million in Q4 2024, reflecting a rise of 21.6%[33] - The company incurred $10.1 million in costs related to group restructuring during 2025[41] Asset Management - Total assets increased to $439.9 million in 2025 from $438.4 million in 2024, reflecting a growth of 0.34%[35] - Accounts receivable decreased to $43.9 million in 2025 from $65.4 million in 2024, a decline of 32.9%[35] - Total current liabilities decreased to $70.8 million in 2025 from $104.0 million in 2024, a reduction of 32.0%[35] Exchange Rates - The exchange rate for converting USD to GBP was 1.32 for the twelve months ended December 31, 2025[47]