ATG reports 5% NGR decline amid Swedish gambling tax rise

Swedish gaming operator AB Trav och Galopp (ATG) has released its financial results for the first half of 2025, reporting a 5% decline in net gaming revenue (NGR). The operator attributes part of the downturn to an increase in gambling taxes, highlighting the ongoing challenges faced by regulated gaming operators in Sweden amid a changing tax and market environment.

First Half 2025 Financial Overview

For the six-month period, ATG reported total net gaming revenue of SEK 2.6 billion ($236.6 million), reflecting a 5% decrease compared to the same period in the previous year. Total revenue mirrored this trend, falling to SEK 2.9 billion, also down 5%.

A closer look at ATG’s product segments shows varying levels of performance. Revenue from horse racing dropped by 5%, sports betting saw a 3% reduction, and casino earnings experienced a sharper decline of 13%. The significant drop in casino revenue suggests that this segment is under pressure from both regulatory changes and market competition.

Despite these declines, ATG maintained a steady customer base of approximately 1.4 million active players. Of these, 89% were categorized as ‘green’ players—those not impacted by problem gambling—and 83% of total turnover came from these responsible players.

Tax Impact on Operating Profit

Operating costs for ATG increased modestly by 1% to SEK 2.2 billion in H1 2025. A key contributor to the financial pressures was the Swedish government’s decision to raise the gambling tax from 18% to 22%. The total tax burden for the first half amounted to SEK 627 million.

Excluding taxes, ATG’s operational costs actually decreased by SEK 47 million compared to H1 2024, totaling SEK 1.6 billion. However, the overall effect of the higher gambling tax contributed to a decline in operating profit to SEK 671 million, down SEK 170 million from the same period last year.

CFO Lotta Nilsson commented on the results: “The way forward is about achieving revenue growth while tightly controlling costs to increase ATG’s results. One part of this effort is retaining our large customer base by developing our gaming offerings, and this fall, we have exciting news with V85, the new major horse racing game on Saturdays.”

Stable Customer Base and Green Player Engagement

ATG’s customer statistics indicate strong engagement among responsible players. The classification of ‘green’ players, accounting for 89% of all users, demonstrates the operator’s focus on responsible gambling initiatives. These players generated 83% of the company’s turnover, underscoring the importance of a stable, engaged customer base even during periods of regulatory and tax-driven pressure.

Maintaining this customer base is central to ATG’s long-term strategy. By emphasizing responsible gaming and innovation in its product offerings, ATG aims to sustain loyalty and reduce reliance on higher-risk gambling segments.

Market Environment and Unlicensed Gaming Challenges

The Swedish gambling market has continued to face challenges from unlicensed operators. A March report by ATG highlighted the persistence of unlicensed gaming activity, which continues to attract a segment of Swedish players. These unregulated operators are not subject to Swedish gambling taxes or responsible gaming requirements, creating competitive pressures for licensed companies like ATG.

ATG has called attention to the importance of strong regulatory enforcement and compliance measures to safeguard both the integrity of the market and player protection. The coexistence of licensed and unlicensed operators represents a significant challenge to revenue growth in Sweden.

Product Development and Innovation

In response to market pressures, ATG has focused on product development and innovation. The operator announced the launch of V85, a new major horse racing game scheduled for Saturdays, designed to attract both casual and dedicated racing fans.

Nilsson emphasized the strategic role of new gaming offerings in retaining customers: “One part of this effort is retaining our large customer base by developing our gaming offerings, and this fall, we have exciting news with V85, the new major horse racing game on Saturdays.”

Product innovation remains a cornerstone of ATG’s approach, aimed at maintaining engagement among its core green player base while attracting new players in a competitive environment.

Financial Resilience Despite Tax Hikes

While the 5% decline in NGR reflects pressures from increased taxation, ATG’s underlying operational resilience is evident in its ability to sustain a large and engaged player base. By controlling costs and focusing on responsible player engagement, the company has maintained profitability even amid rising tax burdens.

The company’s financial performance highlights how regulatory shifts are affecting the gaming sector. Increased taxation, while essential for public revenue and problem gambling prevention, can challenge operators’ margins. ATG’s approach demonstrates a careful balance between compliance and business growth.

Competitive Dynamics in Nordic Markets

ATG’s performance emerges against the backdrop of evolving dynamics in the Nordic gambling sector. Recent accusations by ATG suggest that Veikkaus, Finland’s state monopoly gaming operator, is engaging in anti-competitive practices. As Finland moves toward potential market liberalization, ATG’s observations highlight the importance of fair competition and transparency in regulated markets.

These developments underscore the evolving landscape for gaming operators across the Nordic region. Companies must navigate tax changes, regulatory scrutiny, and competitive dynamics while prioritizing responsible gaming and player protection.

Strategic Outlook for the Second Half of 2025

Looking ahead, ATG plans to focus on revenue growth, cost efficiency, and product innovation. The launch of V85 and other gaming offerings aims to enhance engagement among existing players and attract new participants to the platform.

ATG’s strategic priorities also include strengthening its position against unlicensed operators and ensuring compliance with Sweden’s evolving regulatory framework. By emphasizing responsible gaming and player loyalty, the operator intends to maintain steady turnover and operational profitability despite external challenges.

Conclusion

ATG’s H1 2025 results illustrate a challenging environment for Swedish gaming operators, with net gaming revenue declining 5% due in part to a gambling tax hike from 18% to 22%. Despite these pressures, the company maintains a strong customer base, with 89% of players classified as green and generating 83% of total turnover.

Through a combination of cost management, product innovation, and a focus on responsible gaming, ATG is positioning itself for sustainable growth in the second half of 2025. The introduction of V85 and continued engagement with licensed players highlight the operator’s commitment to navigating regulatory challenges while enhancing its offerings.

The competitive landscape in Sweden, coupled with the presence of unlicensed operators, remains a key factor influencing the company’s strategy. ATG’s financial results and ongoing initiatives reflect a careful balance of compliance, growth, and market positioning in a regulated yet dynamic environment.

FAQs

What contributed to ATG’s 5% decline in NGR?
The decline was primarily due to an increase in Sweden’s gambling tax from 18% to 22%, affecting overall profitability.

How did ATG’s customer base perform in H1 2025?
ATG maintained approximately 1.4 million active players, showing stability despite declining revenues.

What are green players, and why are they important?
Green players are those not affected by problem gambling. They represented 89% of ATG’s customers and generated 83% of turnover.

How did horseracing and casino segments perform?
Horseracing revenue fell 5%, sports betting 3%, and casino revenue 13%, indicating varied performance across product lines.

What is ATG’s strategy for retaining players?
The company focuses on responsible gaming, customer engagement, and product innovation, such as the upcoming V85 horse racing game.

What impact did higher gambling taxes have on operating costs?
Total costs grew by 1% to SEK 2.2 billion, with taxes accounting for SEK 627 million of that total.

How does ATG address unlicensed gaming challenges?
ATG emphasizes regulatory compliance, market enforcement, and responsible gaming initiatives to compete with unlicensed operators.

What is the significance of the V85 game?
V85 is a new major Saturday horse racing game aimed at enhancing player engagement and boosting revenue.

How is ATG navigating competition in the Nordic market?
The company monitors competitive dynamics, including concerns about Veikkaus in Finland, while focusing on fair play and compliance.

What are ATG’s priorities for the second half of 2025?
ATG aims to achieve revenue growth, control costs, launch innovative products, and maintain engagement with responsible players.