The numbers only mean something with the definitions
Gambling companies use a vocabulary that overlaps with general finance and diverges from it in ways that matter. The same word means different things at different companies, and the differences are large enough to change a conclusion. This lesson defines the terms, notes where definitions vary, and says which to trust.
Volume measures
Handle, stakes, turnover, amounts wagered. The total value of bets placed. In sports betting it is the headline volume figure and the basis of hold. In casino it is enormous relative to revenue (a slot player recycles the same money many times) and rarely reported: Flutter, for one, reports sportsbook stakes but says it does not use stakes to track its iGaming business. US state regulators publish handle operator by operator, as New York does in its monthly mobile sports wagering reports; companies choose which volume figures to disclose.
Deposits. Money customers put in. Disclosed by some operators and useful as a leading indicator; less noisy than revenue in casino, since it removes game variance.
Actives. Customers who placed a bet or played in the period. Defined by the company: monthly actives, quarterly actives, real-money actives, "unique active players". Definitions differ even between Flutter and DraftKings: Flutter's average monthly players leave out people who played only with new-player or retention incentives, while DraftKings' monthly unique payers include people who played only with promotional incentives and leave out people who deposited but have not yet played. The period matters too; a quarterly active count is not three times a monthly one. Compare a company only with itself.
First-time depositors (FTDs). New customers who made a first deposit; the acquisition unit.
Revenue measures
Gross gaming revenue (GGR), gross win, gaming revenue. Handle minus winnings paid. The base for most gaming taxes. In company accounts the revenue line is usually stated after bonuses and promotional credits: Flutter's sportsbook and casino revenue is the net win or loss "net of new player incentives and player retention incentives". Regulators' GGR follows their own tax rules instead: New York reports sports wagering GGR on a cash basis, taxing wagers on future events as current revenue, and in Britain remote gaming duty is charged on profits that include any free plays the operator gives away. A state's GGR and a company's revenue for the same quarter will not match.
Net gaming revenue (NGR), net revenue, revenue. GGR less bonuses and free bets, and at some companies less gaming tax. The definition varies most here: some companies deduct tax to reach NGR, some do not. Flutter and DraftKings both put gaming taxes in cost of sales, so their revenue is before tax. A company's "revenue" line may be GGR, NGR before tax, or NGR after tax, and the difference can exceed 30%: gaming taxes run as high as 51% of mobile sports wagering revenue in New York and 40% of remote gaming profits in Britain since 1 April 2026. Read the accounting policy note.
Hold, margin, win margin. GGR divided by handle. In sports betting the structural margin plus luck; reported as "sports margin" or "hold rate" and compared with a "normalised", "expected" or "structural" margin that the company estimates. Many companies report a net revenue margin instead, revenue after bonuses as a share of handle, which DraftKings describes as capturing both its margin and its promotional reinvestment. A quarter with hold below expected is unlucky (results went the customers' way, often because favourites won); above is lucky. Companies quote "normalised" revenue or margin to remove the effect: Flutter reported a US structural revenue margin of 14.2% for 2025 and put the drag from unfavourable sports results at 60 basis points. The normalisation is their own.
Net revenue by product. Sports and gaming (casino, poker, bingo); online and retail; by market. The segment note.
Cost measures
Cost of sales, cost of revenue. Gaming tax and duties, platform and content fees, payment processing, sometimes data, and in the US payments to the partners that provide market access. DraftKings lists product taxes, payment processing, platform costs, revenue share and market access, and data feeds. Mostly costs that scale with revenue.
Marketing, sales and marketing, customer acquisition. Affiliates, paid media, sponsorship, brand, CRM. Reported as a total and, by the better companies, split into acquisition and retention. The largest discretionary cost and the one management guides on.
Operating expenses. Staff, technology, compliance, overhead.
Adjusted EBITDA. Earnings before interest, tax, depreciation and amortisation, adjusted for the items in lesson one. The profit measure gambling companies headline, and a common basis for valuation. Each company writes its own definition: Flutter's excludes, among other items, transaction costs, restructuring, legal settlements and gaming tax disputes, impairments and share-based pay. Statutory operating profit and net income sit below it after depreciation, amortisation (large for acquisitive groups, since acquired brands and customer lists are amortised), interest, tax and the adjusted-out items.
Free cash flow. Cash from operations less capital expenditure, sometimes less lease payments and interest. It is not an accounting-standard measure and, as the US Securities and Exchange Commission warns, it has no uniform definition, so read how each company calculates it. But because it starts from the reported cash flow statement it is much harder to adjust than profit, and it is the one to compare with adjusted EBITDA: a company whose free cash flow is persistently far below its adjusted EBITDA is adjusting out real costs.
Balance sheet terms
Customer balances, player liabilities, customer funds. Money owed to players, held as a liability with the matching cash usually segregated: Flutter shows player deposits as a separate line from its own cash, held in segregated bank accounts and largely restricted by licensing rules. Segregated is not always the same as protected: Gambling Commission licensees must tell customers whether their funds are protected if the company becomes insolvent, and remote licensees must hold customer funds in a separate client bank account, with a reminder every six months where they are rated not protected. Not the company's money; a company that reports cash without noting how much is customer balances is flattering its liquidity.
Net debt. Borrowings less cash (the company's own cash, excluding customer balances). Leverage is net debt divided by adjusted EBITDA; lenders set covenants on a version of it, with EBITDA as their agreement defines it. Flutter's main bank facilities cap net borrowings at 5.2 times EBITDA, tested twice a year.
Goodwill and intangibles. The premium paid in acquisitions, sitting on the balance sheet until impaired; Flutter tests its goodwill for impairment at least once a year. Large at every consolidator: Flutter carried $15.8 billion of goodwill at the end of 2025. An impairment says an acquisition is now worth less than was paid, whether because it was overpaid or because the market changed: Flutter wrote off $517 million of goodwill on Junglee after India banned online real-money gaming in August 2025.
Provisions. For regulatory matters, litigation, and tax disputes. The note is where undisclosed trouble first appears.
Supplier-specific terms
Revenue share income, licence and platform fees, services revenue. Number of operator customers, number of regulated markets or "regulated market revenue as a share of total", content releases, studio and table counts for live casino. Aggregation revenue versus own content revenue for studio groups with aggregators.
Regulatory and tax terms
Point-of-consumption tax, gaming duty, remote gaming duty: the gaming taxes by name. Point of consumption means the tax follows the customer rather than the operator: British remote gaming duty is charged on profits from customers who usually live in the UK, wherever the operator is based. Regulatory settlement: a payment to resolve a regulator's findings, usually adjusted out of adjusted EBITDA. Provision for regulatory matters: money set aside for one not yet resolved. Licence expiry and renewal: noted where a concession or licence has a term.
The definitions to check first
Before comparing anything across companies: what is the revenue line (GGR, NGR before or after tax)? What is in cost of sales? What is adjusted out of EBITDA? What is an active? And what period is the comparison? Five questions, and the answers are in the accounting policies, the KPI definitions and the reconciliation tables, which is why lesson one said to read the tables before the story. The next lesson applies the vocabulary to an operator's results.