Entain Holds FY26 Guidance as UK Online Grows 14% and Brazil Falls 36%

Entain's British online business grew 14% under the new 40% gaming duty, while customer-friendly football results and a Brazilian unit that shrank by more than a third before the ban held the group to 2%. Guidance survives with profit pinned to the bottom of the range, and the chief executive used the update to lobby the government before the Budget.

• Entain's third-quarter group net gaming revenue (NGR) rose 2% at constant currency and online NGR 3%, with gaming up 8% offsetting customer-friendly football results, according to its trading update on 15 October
• UK and Ireland online NGR rose 14%, ahead of expectations, while Brazil fell 36% before the ban that took licensed sites offline
• Entain reiterated FY26 guidance of 4% to 6% online NGR growth and underlying EBITDA at the lower end of £910 million to £960 million, two days after BetMGM kept its own guidance at the low end
• Chief executive Stella David urged the UK Government to "carefully consider any further gambling tax increases", as the 28 October Budget weighs a doubling of Machine Games Duty
• The sale of 20% of Entain CEE remains on track for the fourth quarter, and the shares were 2.34% lower at 434p by 09:00 BST, according to Sharecast

Gaming Carried the Quarter While Football Results and Brazil Held It Back

Entain plc published its update for 1 July to 30 September on Thursday 15 October. All figures are at constant currency and for continuing operations, which now exclude Entain CEE, the Polish and Croatian business it has begun to sell. Group NGR rose 2% and online NGR 3%. Online gaming grew 8%, but online sports NGR fell 3% on wagers down 1%, which the company attributes to customer-friendly football results in August and September that more than offset a strong July.

Entain puts the sports margin headwind at about 1 to 2 percentage points, a drag of about 4% on online growth. Excluding Brazil, online NGR rose 5% on volumes up 7%, and is up 8% for the year to date. Retail NGR fell 2% despite volumes rising 2%.

The UK and Ireland was the standout. Divisional NGR rose 8%, ahead of expectations, with online up 14%, gaming up 17% and sports up 3%, on volumes up 15%, which the company calls evidence of market share gains. Retail grew 3% like for like. Entain says the division is "digesting the increasingly challenging tax environment".

International NGR fell 4%, or rose 1% online excluding Brazil. Australia's online NGR rose 1%, in line with expectations, and Italy fell 6% despite volumes up 9%, after a sports margin 3.1 points lower than a year earlier. New Zealand, Spain and Canada each delivered double-digit online growth. Brazil fell 36%, which Entain attributes to "disciplined marketing and player engagement in an increasingly challenging market" before the online gambling ban announced on 25 September. Entain CEE, reported as a discontinued operation, was flat.

Guidance Kept, With Brazil Written Off for the Year

Entain reiterated the guidance it reset on 28 September, three days after Brazil's provisional measure withdrew all operators' authority to offer online betting and gaming. It expects FY26 online NGR growth of 4% to 6% at constant currency, or the top end of 5% to 7% excluding Brazil, and an online underlying EBITDA margin at the lower end of 21% to 22%. Group underlying EBITDA, excluding the parent fees BetMGM now pays, is expected at the lower end of £910 million to £960 million. It assumes the Brazilian ban holds for the rest of 2026; Entain had expected Brazil to be about 5% of online NGR this year, with a "modest" EBITDA contribution.

The update repeats BetMGM's guidance of $2.9 billion to $3.1 billion of net revenue and $300 million to $350 million of adjusted EBITDA, towards the lower end of both. Entain still expects £500 million of annual adjusted cashflow in 2028, including a 47.5% minority stake in Entain CEE, while noting that the effect of "forthcoming taxation and regulatory developments" is unknown. The 20% stake sale to EMMA Capital, agreed in June for about €425 million, approximately £366 million, as we reported, is expected to close in the fourth quarter, subject to regulatory approvals.

David said online and retail are both "valued contributors to tax revenues and local communities", and that Entain "strongly" urged the government to consider any further tax rises carefully, as they "would threaten the viability of many shops, jobs and livelihoods".

The British Online Business Is Growing Through the Tax, Not Around It

The 14% is the most important number in the update. Remote Gaming Duty rose from 21% to 40% in April, and Entain's British online gaming revenue grew 17% in the quarter anyway. The duty shows up in margins rather than in the growth rate, but the growth still matters in Westminster. A company growing British online gaming at this pace will struggle to persuade the Treasury that the online rise has broken the model, which is why David's appeal is aimed at the shops. Doubling the standard rate of Machine Games Duty would add about £100 million a year to the cost of running Entain's UK shops, she wrote to the Prime Minister in September, according to NEXT.io's report of the letter. That is about 11% of the bottom of its EBITDA range on our arithmetic, landing on a retail estate growing 3%.

The Guidance Asks Less of the Fourth Quarter Than the Year So Far

Excluding Brazil, online NGR is up 8% for the year to date, yet Entain guides to the top end of 5% to 7%. If the quarters were of similar size, that implies fourth-quarter growth of about 4%, half the pace so far. The profit wording has also shifted: on 28 September Entain expected EBITDA "towards" the lower end; it now says "at" the lower end. Neither change breaks guidance, but both leave little room for another run of bad football results, and BetMGM, which needs its biggest quarter yet to reach its own range, is no obvious source of upside.

Brazil Was Shrinking Before It Was Shut

Brazil's 36% fall came before licensed sites went dark on 6 October, which suggests Entain was already pulling back from a market it describes as challenging. A business with modest EBITDA that had lost a third of its revenue was not carrying the group, so the write-off costs less than its revenue share implies. The growth now comes from markets that are regulating rather than banning: Canada, Spain and New Zealand, where Entain's Playvia entity won two rights to apply for an online casino licence, according to iGaming Expert. It is a portfolio argument, and this quarter supports it.

Entain has shown that its British online business can grow through a near-doubled gaming tax, and that losing Brazil trims the group rather than breaking it. Whether the Budget on 28 October adds a second bill for its shops will decide how far that resilience stretches.