888 Holdings ((GB:EVOK)) has held its Q2 earnings call. Read on for the main highlights of the call.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 55% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
The recent earnings call from 888 Holdings conveyed a generally positive sentiment, emphasizing significant improvements in profitability and consistent revenue growth. The company demonstrated effective deleveraging efforts, although challenges persist in certain markets and segments, particularly in U.K. online and retail sports.
Continued Revenue Growth
888 Holdings celebrated its fourth consecutive quarter of revenue growth, with a 5% increase in Q2. This growth was primarily driven by strong performances in international core markets and a resurgence in retail growth.
Significant Increase in Profitability
The company reported a remarkable 44% increase in EBITDA for the first half of 2025, reaching GBP 166 million. The last twelve months (LTM) EBITDA now stands at GBP 363 million, reflecting a substantial improvement in profitability.
Deleveraging Efforts
888 Holdings has successfully reduced its leverage to 5x, marking a 1.7 turn improvement over the past year. The company aims to further reduce leverage below 3.5x by 2027, showcasing its commitment to financial stability.
Strong International Segment Performance
The international segment was a standout performer, with revenue growing by 13%. This contributed to more than doubling the segment’s EBITDA to GBP 86 million, which now accounts for over half of the group’s total EBITDA.
Retail Growth
Retail operations returned to growth in Q2, driven by the rollout of 5,000 new gaming machines. This resulted in a 15% increase in gross win per machine per week, highlighting the success of the company’s retail strategy.
Flat Revenue in U.K. Online
The U.K. online segment faced challenges, with revenue down 1% for H1 2025. Issues included poor marketing returns for the 888 brand and a strategic focus on profitability over volume.
Decline in Retail Sports
Retail sports revenue declined by 2% for the half, impacted by market-wide issues such as pressure on the racing industry and changes in high street footfall dynamics.
Impact of Increased Costs
Higher fixed costs from changes in National Insurance and National Living Wage affected retail profitability, despite some cost-saving measures.
Challenges in Specific Markets
While international growth was robust, 888 Holdings faced challenges in specific markets like Spain, where sports product performance lagged, and Romania, which saw recent tax increases.
Forward-Looking Guidance
Looking ahead, 888 Holdings reiterated its guidance for 2025, targeting a revenue growth of 5% to 9% and an EBITDA margin of at least 20%. The company remains focused on short-term operational improvements and long-term strategic investments, aiming to sustain its positive momentum.
In summary, the earnings call from 888 Holdings reflected a positive outlook, with significant improvements in profitability and consistent revenue growth. While challenges remain in certain markets, the company’s strategic focus on deleveraging and international expansion positions it well for future success.