Financial Data and Key Metrics Changes - EBITDA for Q2 2025 was $28.4 million, up 15% compared to Q2 2024, with EBITDA margins improving from 33% to 35% [5][19] - The Interactive business was the primary growth driver, with EBITDA growth of nearly 50% year over year [5][12] Business Line Data and Key Metrics Changes - The Interactive segment achieved its eighth consecutive quarter of over 40% year-over-year adjusted EBITDA growth, with an adjusted EBITDA margin expansion of 200 basis points to 67% [12][19] - Gaming EBITDA increased by 35% year over year, significantly driven by the performance of William Hill [17][19] - Virtual Sports EBITDA showed a sequential improvement, with expectations for continued growth in Q3 and Q4 [15][26] Market Data and Key Metrics Changes - Less than 10% of the U.S. population is in jurisdictions offering iGaming, compared to 70% for sports betting, indicating significant growth potential [6] - The company is seeing growth in Brazil, with a focus on launching additional operators and bespoke content [12][36] Company Strategy and Development Direction - The company is focusing on digital segments, aiming to improve cash conversion and EBITDA margins, with a target of approaching 40% [10][19] - The sale of the Holiday Park business is expected to enhance liquidity and shift the business mix further towards digital [10][19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the Interactive business, noting that it is still in its infancy and has considerable room for growth [6][12] - The company is cautiously optimistic about the Virtual Sports segment, expecting to see year-over-year growth by the end of the year [7][15] Other Important Information - The company successfully refinanced its credit facility and is in the process of converting floating rate debt to fixed rate [8][9] - A new contract was awarded to supply gaming machines for JenningsBet, the largest independent bookmaker in the UK [8][18] Q&A Session Summary Question: Can you elaborate on the momentum in hybrid dealer? - Management noted a good mix of customers, including tier one and tier two operators, with positive traction and increasing player volume [22][24] Question: Will Virtual Sports see a year-over-year increase in EBITDA? - Management indicated that while Q3 might not see significant growth, Q4 is expected to show improvements due to new product launches [26] Question: What drives the next leg of growth in the Gaming segment? - Management highlighted opportunities in Canadian provinces and Illinois, where the market is expanding and content refreshment is key [41][43] Question: What are the promising international markets for hybrid dealer? - Management stated that every market appears promising, with ongoing rollouts in North America, UK, Greece, and Brazil [45][46] Question: What are the capital deployment priorities? - The first priority is funding business growth, followed by debt reduction, with share repurchases considered afterward [52]

Financial Data and Key Metrics Changes - Adjusted EBITDA for Q4 was $30.9 million, up 22% from the previous year [6] - Full year adjusted EBITDA was $100.1 million, compared to $99.3 million for 2023 [6][7] - The company received a letter from the SEC indicating that their inquiry is now closed with no further action [7] Business Line Data and Key Metrics Changes - The Interactive business saw revenue and EBITDA growth of 45% and 105% respectively in Q4, accounting for approximately 22% of overall company EBITDA [8][9] - The Digital business is expected to approach 60% of EBITDA by year-end, driven by growth in Interactive and modest acceleration in Virtual Sports [12] - The land-based gaming segment had EBITDA growth of 42% year-over-year in Q4, attributed to gaming hardware sales [25] Market Data and Key Metrics Changes - The company noted that in states with both iGaming and Sports Betting, iGaming outperforms Sports Betting by a ratio of 4 or 5 to 1 [9] - The company is optimistic about the potential growth in the Brazilian market, which is expected to become a significant market for them [53] Company Strategy and Development Direction - The company is focusing on enhancing product development in the Virtual Sports segment to replicate the success seen in Interactive [75] - There is a strategic review ongoing for the holiday parks business, with a cautious optimism about a favorable conclusion [37] - The company is actively looking for M&A opportunities that fit their criteria, although nothing is currently on the horizon [39] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of their business structure, with over 85% of revenue being contractually recurring [13] - The company is optimistic about the future growth of the Virtual Sports business, especially with new innovations and market expansions [34][75] - Management indicated that the current economic environment is being navigated well, with a strong balance sheet and cash position [76] Other Important Information - The company plans to file their 10-K by the end of the week following the earnings call [7] - The company is experiencing a significant year-to-year increase in accounts receivable, impacting year-end cash [15] Q&A Session Summary Question: Challenges in Virtual Sports segment - Management acknowledged that the struggles are primarily driven by one customer but noted stabilization and modest growth in the rest of the business [32][34] Question: Updates on M&A strategy - The company is exploring the sale of holiday parks and remains optimistic about the outcome, while also looking for M&A opportunities that align with their strategy [36][39] Question: U.K. white paper impact - Management expects minimal impact from the upcoming stakes limits and is hopeful for the liberalization of B3 cabinets, which would benefit their sales [42][44] Question: Cash balance expectations - Management indicated that the cash balance is likely to be lower than previously guided due to delays in receivables and accelerated supplier payments [45][46] Question: Virtual Sports growth confidence - Management expressed confidence in the stabilization of Virtual Sports revenue and highlighted strong results from key customers in Brazil [50][53] Question: CapEx needs and cash flow - Management confirmed that CapEx needs are planned and budgeted, with no unexpected expenses anticipated [60][62] Question: Lottery business growth opportunities - Management is excited about the upcoming launch of a cloud-based lottery system and sees significant opportunities in the lottery segment [64][68]