Playtech’s Earnings Call: Strategic Shifts and Optimism

Playtech plc ((GB:PTEC)) has held its Q2 earnings call. Read on for the main highlights of the call.

Playtech plc’s recent earnings call reflects a cautiously optimistic sentiment, highlighting a strategic shift towards high-growth B2B markets, particularly in the Americas. The company maintains a strong financial position and is expanding its Live Casino segment. However, challenges persist with revenue declines due to revised agreements and regulatory headwinds in emerging markets. The B2C division also faces significant hurdles, yet the focus remains on long-term growth.

Strong First Half Performance

Playtech reported an adjusted EBITDA of EUR 92 million for the first half, consistent with upgraded expectations. This performance underscores solid growth and strategic progress in core markets, especially in the Americas, showcasing the company’s resilience and adaptability in a competitive landscape.

Snaitech Disposal and Financial Flexibility

The disposal of Snaitech has significantly strengthened Playtech’s balance sheet, resulting in a net cash position of EUR 77 million as of June 2025. This financial flexibility allows for strategic capital allocation and debt repayment, positioning the company for future growth opportunities.

U.S. Market Growth

Revenues in the U.S. and Canada surged by 64%, driven by substantial investments in Live Casino and strategic partnerships with major operators. This growth highlights Playtech’s successful penetration into the North American market and its commitment to expanding its footprint in this lucrative region.

Live Casino Expansion

The demand for Live Casino continues to rise, with revenues increasing by 9%. Significant growth in the U.S. has prompted Playtech to plan capacity expansions in Latin America and Europe, indicating a robust strategy to capitalize on this high-growth segment.

Revenue Decline Due to Revised Agreements

Playtech experienced a 10% year-on-year decline in group revenue, primarily due to a revised agreement with Caliente Interactive, which affected the collection of service fees. This highlights the challenges of navigating contractual changes in dynamic markets.

Challenges in Emerging Markets

Regulatory transitions in Brazil and VAT implementation in Colombia have created headwinds, impacting revenue growth in these emerging markets. These challenges underscore the complexities of operating in diverse regulatory environments.

B2C Division Struggles

The B2C division faced a 17% year-on-year revenue decline, with significant losses from the HappyBet business due to the closure of the Austrian business and the winding down of German operations. This reflects the ongoing struggles within the B2C segment.

Exposure to Unregulated Markets

Concerns were raised about unregulated revenue streams, including sweepstakes in the U.S., which contribute to approximately 1% of group revenues. This highlights the risks associated with reliance on unregulated markets.

Positive Outlook and Guidance

Playtech’s leadership remains optimistic about the future, with expectations to exceed full-year 2025 adjusted EBITDA forecasts. The company has revised its CapEx guidance to EUR 80 million to EUR 90 million and maintains an effective tax rate guidance of 25% to 28%. Playtech is confident in meeting its medium-term adjusted EBITDA target of EUR 250 million to EUR 300 million, alongside free cash flow targets of EUR 70 million to EUR 100 million. Strategic priorities focus on regulated markets such as the U.S. and Brazil, with continued investment in high-growth areas like Live Casino.

In summary, Playtech’s earnings call reflects a cautiously optimistic outlook, with a strategic focus on high-growth B2B markets and Live Casino expansion. While challenges persist in revenue declines and regulatory headwinds, the company’s strong financial position and strategic initiatives provide a solid foundation for future growth.