• ATG reports a drop in net gaming revenue and parent company results for 2025.
• Increased gambling tax and lower income directly impact funding for Swedish horse racing.
• Long-serving CEO Hans Lord Skarplöth steps down amid strategic disagreements with the board.
• CFO Lotta Nilsson warns that the current tax burden weakens the sector’s financing.
• ATG continues to advocate for differential tax rates based on product risk.

Sweden’s historic horse racing operator, AB Trav och Galopp (ATG), has posted a sombre set of annual results for 2025, revealing that a combination of declining gaming income and increased fiscal pressure is eroding the financial bedrock of the sport.

The operator confirmed that net gaming revenue slipped by two per cent over the year, dragging the parent company’s result down from SEK 2.346 billion (£182 million) to SEK 2.099 billion (£163 million). This downturn arrives at a precarious moment for the Swedish market, where the government’s 2024 decision to raise the gambling tax continues to reverberate through the licensed sector.

Tax Hikes Squeeze Returns

Lotta Nilsson, ATG’s Chief Financial Officer and Deputy Chief Executive, did not mince words regarding the impact of state policy on the industry’s ecosystem. In a statement accompanying the financial release, she highlighted that the dual pressures of falling revenue and higher taxation are cutting directly into the funds available for horse racing.

"Both the lower revenues and the increased gambling tax hit the return to our owners directly and thus weaken the financing of the horse racing sector," Nilsson stated. "It is a development we take seriously."

The tax increase has deepened a fracture within the Swedish gambling community. While commercial online operators argue that higher operational costs drive players toward the unlicensed black market, ATG has taken a distinct stance. The former monopoly contends that gambling products should be taxed according to their risk profile and social utility, aggressively lobbying for a more favourable rate on horse wagering compared to high-risk verticals like online casino.

Leadership Shake-up Amidst Financial Slide

The financial disclosure came just twenty-four hours after ATG announced the departure of Hans Lord Skarplöth, its Chief Executive of thirteen years. While the timing naturally invites speculation, ATG Chair Peter Norman was quick to dismiss any correlation between the disappointing figures and the leadership change.

According to the board, the separation was driven by divergent views on future strategy rather than immediate financial performance. Norman, who steps in as interim CEO, paid tribute to Skarplöth’s transformative tenure, noting his success in diversifying ATG from a pure racing operator into a "professional gambling company" with a robust presence in sports betting and casino.

"Hasse has driven the company in an exemplary way, which has also included an international expansion," Norman said. "The board would like to thank Hasse for his great efforts for ATG through all the years."

Skarplöth echoed these sentiments, describing his time at the helm as a "growth journey without parallel" and expressing pride in the company's current market position.

The 2025 results from ATG serve as a stark validation of the warnings issued by the industry regarding Sweden's tax policies. When a state-controlled entity specifically designed to fund a national sport begins to falter under the weight of taxation, it suggests the fiscal balance has tipped too far. The government's objective to raise revenue is now actively cannibalising the very sector, horse racing, that the regulatory framework was partly designed to protect. If the "financing of the horse racing sector" is indeed weakening, we may soon see a more desperate lobbying effort from the agricultural and sporting bodies that rely on ATG’s dividends.

Skarplöth’s departure is equally significant, marking the end of the modernisation era for ATG. Under his leadership, the operator successfully navigated the reregulation of the Swedish market in 2019, managing to hold its ground against agile commercial giants like Kindred and Betsson. His exit suggests a potential pivot in strategy. Given the board's mention of "different views," one might speculate whether the future direction involves retrenching to core racing products to justify a differential tax status, or perhaps a more aggressive push into international markets to offset domestic stagnation.

Finally, ATG’s isolationist stance on taxation, advocating for lower rates for itself while throwing online casinos under the bus, may prove risky in the long run. By breaking ranks with the broader industry trade bodies, ATG alienates potential allies in the fight against the black market. If the government refuses to adopt a tiered tax system, ATG is left with the same high costs as its competitors but without the same flexibility to pivot entirely to high-margin casino products, leaving it in a strategically vulnerable position.