Flutter Entertainment (NYSE:FLUT) Q4 2025 Earnings call February 26, 2026 04:30 PM ET Company ParticipantsBen Shelley - Director of European Leisure, Media, and Internet Equity ResearchBrandt Montour - Director of Equity Research in Gaming, Lodging, and LeisureClark Lampen - Managing Director of Digital GamingDan Politzer - Executive Director of Equity Research in Gaming and LodgingJordan Bender - Managing Director of Gaming Equity ResearchMonique Pollard - Managing Director of Equity ResearchPaul Ruddy - H ...

Financial Data and Key Metrics Changes - In 2025, the company achieved record company-wide revenues with EBITDA of approximately $1.4 billion, maintaining property level margins at 40%, consistent with the previous year [5][24] - For the fourth quarter, revenues were $1.1 billion, and EBITDA was $337 million, reflecting continued growth in gaming revenues despite a $40 million impact from changes in the online segment and severe winter weather [9][24] Business Line Data and Key Metrics Changes - The Las Vegas Locals segment saw strong gaming revenue growth driven by core customers, although cash hotel revenues declined by nearly $6 million due to softness in destination business [10][11] - The Midwest and South segment experienced growth from core and retail customers, but revenues and EBITDAR were impacted by severe winter weather and the permanent closure of Sam's Town Tunica [12][13] Market Data and Key Metrics Changes - The company noted a 10% decline in pedestrian traffic on the Fremont Street Experience, affecting the downtown Las Vegas segment, while the Midwest and South markets continued to see strong play from core customers [11][12] - The online segment generated EBITDAR of $63 million for the full year, with expectations of $30-$35 million in 2026, driven by Boyd Interactive and changes in revenue share agreements [13][24] Company Strategy and Development Direction - The company plans to continue investing in property improvements and growth projects, including the opening of Cadence Crossing Casino and the completion of the Suncoast modernization project [7][18] - The company remains open to M&A opportunities but emphasizes a disciplined approach to ensure the right asset at the right price [36][37] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2026, expecting benefits from new investments and consumer spending supported by tax legislation [8][28] - The company anticipates continued growth from core customers and positive trends in retail spending, despite challenges in the destination business [29][72] Other Important Information - The company returned over $800 million to shareholders in 2025 through share repurchases and dividends, reducing the total share count by 11% [7][26] - The company expects to maintain quarterly share repurchases of approximately $150 million and regular dividends, equating to over $650 million annually [27][20] Q&A Session Summary Question: Can you bifurcate between real locals play and destination locals play? - Management noted strong play from Las Vegas local residents, while destination play showed weakness, particularly affecting hotel revenues at the Orleans [31][32] Question: Any updated thoughts on the M&A pipeline? - Management remains interested in M&A opportunities but emphasizes a disciplined approach to ensure the right fit [35][36] Question: What are your current views on the structure of potential acquisitions? - Management is open to both Holdco and Opco structures for acquisitions, focusing on the right asset and price [42][43] Question: How do you view the impact of the tax legislation on your customer base? - Management expects significant benefits from the tax legislation for both Nevada and Midwest customers, enhancing consumer spending [51][52] Question: What is the expected impact of weather on the first quarter results? - Management indicated a similar impact to the previous year, estimating around a $5 million effect from weather in January [73][75]

Financial Data and Key Metrics Changes - In 2025, the company achieved record company-wide revenues with EBITDA of approximately $1.4 billion, maintaining property level margins at 40% [4][21] - For Q4 2025, revenues were $1.1 billion and EBITDA was $337 million, reflecting continued growth in gaming revenues [7][21] - Year-over-year EBITDA comparisons in Q4 were impacted by approximately $40 million due to changes in the online segment and severe winter weather [7][21] Business Line Data and Key Metrics Changes - The Las Vegas Locals segment saw strong gaming revenue growth driven by core customers, although cash hotel revenues declined by nearly $6 million due to softness in destination business [8][9] - The Midwest and South segment experienced growth from core and retail customers, but revenues were impacted by severe winter weather and the permanent closure of Sam's Town Tunica [10][11] - The online segment achieved EBITDAR of $63 million for the full year, with projections of $30-$35 million in 2026 [11][21] Market Data and Key Metrics Changes - The Las Vegas locals market showed strong play from local residents, while destination play remained weak, particularly affecting hotel revenues at the Orleans [31][32] - The company expects consumer spending to benefit from last year's tax legislation, particularly in Southern Nevada [6][27] - The Midwest and South markets are anticipated to continue benefiting from customers staying closer to home [11][70] Company Strategy and Development Direction - The company plans to continue investing in property improvements and growth projects, with capital expenditures expected to be between $650 million and $700 million in 2026 [22][23] - New projects include the opening of Cadence Crossing Casino and the development of a $160 million gaming facility at Par-A-Dice [16][23] - The company remains open to M&A opportunities but emphasizes a disciplined approach to acquisitions [35][42] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2026, citing strong customer trends and the expected benefits from new investments and tax legislation [5][27] - The company noted that while destination business remains weak, core customer segments continue to perform well [70][90] - Management highlighted the importance of operational discipline and cost controls in maintaining performance [7][21] Other Important Information - The company returned over $800 million to shareholders in 2025 through share repurchases and dividends, reducing the total share count by 11% [5][24] - The company plans to continue repurchasing approximately $150 million in shares per quarter, supplemented by regular dividends [25][27] - The transitional casino in Norfolk, Virginia, is expected to break even until the permanent resort opens in late 2027 [61] Q&A Session Summary Question: Can you bifurcate between real locals play and destination locals play? - Management noted strong play from Las Vegas local residents, while destination play has shown weakness, particularly affecting hotel revenues at the Orleans [31][32] Question: Any updates on the M&A pipeline? - Management remains interested in M&A opportunities but emphasizes a disciplined approach to ensure the right asset at the right price [35][36] Question: What are the expectations for the customer base aged 65 and older? - Approximately 40% of the customer base is 65 and older, and management expects positive impacts from tax legislation for both Nevada and Midwest customers [49][51] Question: How is the weather impacting the Midwest and South segments? - Management indicated a similar impact to last year, estimating about a $5 million impact from weather in January [72][73] Question: What is the operational perspective on the transitional casino in Virginia? - Management expects the transitional casino to break even until the permanent facility opens [61] Question: How does the company view iGaming expansion? - The company supports iGaming expansion and sees it as complementary to their business, looking for opportunities to participate in new state launches [62][88]

Core Insights - Expanse Studios has entered a strategic content distribution partnership with Brazino777, enhancing its presence in Brazil's online gaming market, which is expected to exceed $2.6 billion in revenue by 2026 due to new regulatory changes [1][2]. Group 1: Partnership Details - The agreement allows Expanse Studios to integrate its portfolio of online casino games, including slots and table games, into Brazino777's platform through a direct distribution model [2]. - This partnership is part of Golden Matrix Group's strategy to expand high-margin B2B operations in regulated and high-growth markets [2]. Group 2: Market Dynamics - Brazil is recognized as a highly dynamic and competitive iGaming market, providing Expanse Studios with access to a large and engaged player base [3]. - The collaboration aims to deliver innovative and high-performing content that aligns with player preferences, enabling rapid optimization and enhancement of the gaming experience [3]. Group 3: Company Overview - Expanse Studios is a B2B iGaming content provider with a portfolio of 56 proprietary titles, serving over 1,300 casino brands across Europe, Latin America, and North America [4]. - Golden Matrix Group operates globally through various B2B and B2C divisions, including online casinos and sports betting platforms, licensed in multiple jurisdictions [5].

Industry Overview - The American iGaming industry is still growing and has not yet reached maturity compared to its European counterparts [1] - The analysis focuses on the four strongest stocks in American iGaming and their potential performance by 2026 [1] DraftKings – DKNG - DraftKings started as a fantasy sports service and expanded into sports betting and online casino services following the easing of betting restrictions in 2018 [3] - The stock is currently trading in the $35 to $36 range, with previous highs of $47 and $53 in 2025 [4] - DraftKings is entering the predictions market, driven by services like Kalshi and Polymarket, and plans to offer this in regions where sports betting is not available [4] - Anticipated boost in usage during the FIFA World Cup, co-hosted by the US, with a moderate buy recommendation targeting $44 [5] FanDuel – FLUT - FanDuel has transitioned from a fantasy sports service to a comprehensive iGaming platform, focusing heavily on online casino technology [6] - The stock is trading in the $215 to $219 range, with expectations for growth due to consistent profitability and favorable regulatory trends [7] - Rated as a strong buy with a price target of $300 for the year [7] BetMGM – MGM - BetMGM, associated with the MGM brand, has been expanding its online casino experience since 2018 and has formed partnerships with major sports leagues [8] - The focus for 2026 is on achieving a $500 million positive EBITDA, which could lead to a re-rating of the stock [9] theScore Bet – PENN - theScore Bet operates in the US under Penn Entertainment and is focusing on a lean, efficient operation after exiting an ESPN partnership [11] - The strategy involves cutting excess and leveraging technology for profitability, with a loyal customer base in Ontario [12] - The launch of a new iGaming market in Alberta could impact its operations, leading to a speculative buy rating [12]

Core Insights - Expanse Studios, a subsidiary of Golden Matrix Group Inc., is set to release Super Heli Premium, an enhanced version of its popular crash game, featuring new gameplay mechanics and improved operator customization [1][3]. Game Performance and Features - The original Super Heli game quickly became a top-requested title in European iGaming, with session lengths exceeding industry averages and retention metrics significantly better than category norms [2]. - Super Heli Premium will introduce new gameplay modes that expand strategic options, including prediction-based betting and range-based outcomes, catering to both conservative and aggressive play styles [7]. - The game will feature improved Return to Player (RTP) rates, enhancing player return while maintaining the volatility profile that contributed to the original game's success [7]. Operator Flexibility and Market Reach - Super Heli Premium is designed as a platform play, allowing operators to configure the game for various audience segments, from casual players to those seeking deeper strategic engagement [3]. - Expanse Studios currently has over 1,300 B2B partnerships globally, with more than 300 new operators added in Q3 2025, indicating strong market expansion [4]. - The game will be available across Expanse's global operator network, including active integrations in the US, Brazil, Europe, and emerging markets in Eastern Europe and Africa [4]. Company Overview - Expanse Studios specializes in B2B iGaming content, offering a portfolio of 56 proprietary titles and powering over 1,300 casino brands across Europe, LATAM, and North America [5]. - Golden Matrix Group Inc. operates globally through B2B divisions and B2C operations, including various gaming platforms and services across multiple jurisdictions [6].

Core Insights - Expanse Studios has entered a content distribution agreement with Vegas.hr, enhancing its presence in the Croatian iGaming market [1][2] - The partnership allows Vegas.hr to offer a range of certified games from Expanse's portfolio, including popular titles [2][3] - Croatia's online casino revenue is projected to reach $482 million in 2025, indicating a rapidly growing market [4] Company Developments - Expanse Studios has received Croatian certification from the Ministry of Finance, starting with Super Heli and expanding to 15 certified titles [5] - The CEO of Expanse Studios highlighted the importance of regulatory compliance and content quality for market access [6] - The partnership with Vegas.hr is part of Expanse's strategy to build relationships in regulated markets [6] Market Context - Croatia's iGaming market is characterized by accelerating digital adoption, with internet penetration at 84.4% at the start of 2024 [4] - Expanse Studios has also secured regulatory approvals in Romania and Sweden, expanding its European B2B distribution network [7] - The company has over 1,300 B2B operator partnerships globally and a portfolio of 56 proprietary titles [8]

Financial Data and Key Metrics Changes - The company reported Q3 adjusted EBITDA of $32.3 million and trailing 12-month adjusted EBITDA of $110 million, both exceeding consensus expectations [3][10] - The trailing 12-month revenue reached $310 million, with an adjusted EBITDA margin of 35% [16][19] Business Line Data and Key Metrics Changes - The interactive segment achieved over 40% year-over-year adjusted EBITDA growth for the ninth consecutive quarter, with October being the largest revenue month in the segment's history [7][10] - The virtual sports segment showed stabilization for the second consecutive quarter, with expectations for year-over-year growth in Q4 [7][10] Market Data and Key Metrics Changes - The company is gaining market share in the U.K. and North America, with strong performance noted in both regions [7][13] - In North America, performance in Illinois and key Canadian provinces reached the highest levels since product introduction [15] Company Strategy and Development Direction - The sale of the holiday parks business is a strategic move to enhance adjusted EBITDA margins, reduce capital expenditures, and lower headcount by nearly 40% [8][19] - The company plans to increase game deliveries through a new interactive studio to meet customer demand for more content [11][49] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating potential tax changes in the U.K. gaming industry, citing past experiences with similar challenges [5][6] - The company anticipates significant operating leverage from the expansion of iGaming states, viewing it as a transformational opportunity [11][19] Other Important Information - A $25 million share buyback plan has been reauthorized as part of the company's future plans [8][19] - The company is focusing on organic growth without immediate expectations of M&A impacts, although it continues to evaluate potential tuck-in acquisitions [20][27] Q&A Session Summary Question: Can you walk through the revenue growth and margin expectations? - Management indicated that the holiday parks business's divestiture is the main driver for projected revenue changes, while other segments are expected to grow [22][23] Question: What gives confidence in the virtual sports segment's growth? - Adjustments with major customers and new customer additions in Brazil and Turkey are expected to drive growth in the virtual sports segment [24][25] Question: Can you elaborate on M&A strategy? - The company is focused on tuck-in acquisitions that enhance existing operations, avoiding large diversification deals [26][27] Question: What is the status of the interactive studio? - The new interactive studio will be developed organically, with plans to enhance content offerings [34][35] Question: How does the company view share buybacks? - The share buyback will be opportunistic, balancing leverage reduction and potential M&A opportunities [37][39] Question: What is the outlook for the interactive business growth? - The company expects continued strong growth in the interactive segment, driven by increased game delivery and customer demand [48][49]

Group 1 - MGM Resorts International experienced a net revenue increase of 2% year over year to $4.3 billion for Q3 2025, driven by growth in MGM China [6][7] - The company reported a net Q3 loss of $285 million, primarily due to the withdrawal of its application for a commercial gaming license in Yonkers, New York [4] - Las Vegas saw a decline in net revenue by 7% year over year for the quarter, attributed to room remodels at MGM Grand Las Vegas and decreases in RevPAR, table games win percentage, and food and beverage revenue [7] Group 2 - MGM's Las Vegas segment has faced declines for four consecutive quarters, with a Q2 decline of 4% year over year, while Caesars Entertainment reported a nearly 10% decline in the market [3] - CEO Bill Hornbuckle noted a decline in international visitation, particularly from Canada, and the impact of Spirit Airlines' bankruptcy on canceled routes [3] - Despite current challenges, MGM anticipates over 40 million visitors to Las Vegas in 2025 and is working on initiatives to increase visitation [4] Group 3 - MGM China reported net third-quarter revenue of $1.1 billion, a 17% increase year over year, despite a $12 million impact from a typhoon [6] - The segment adjusted EBITDAR for MGM China increased by 20% year over year to $284 million, with a market share of 15.5% [6] - The company highlighted the divestment of MGM Northfield Park casino operations in Ohio for $546 million in cash [5] Group 4 - There are signs of stabilization in Las Vegas for Q4, with the return of groups and conventions and a strengthening luxury market segment [6] - MGM Digital saw a 23% year-over-year growth in Q3, with the appointment of Gary Fritz as chief commercial officer to accelerate digital and iGaming growth [7]

Event Overview - FUTURUM GEORGIA by MEXC brought together crypto, iGaming, and AI sectors in Tbilisi [1] - The event featured insights from top speakers, a Startup Pitch Battle, an expo zone, networking, and an afterparty [1] Target Audience - The event targeted builders, traders, and innovators [1] MEXC's Role - MEXC hosted the FUTURUM GEORGIA event [1]