Entain reports resilient H1 growth despite higher taxes and market pressure

Entain reported a solid first-half performance for 2026, with group net gaming revenue increasing 5% year on year to €3.0bn (£2.55bn). The result reflects continued activity across online and retail operations in several of the group’s core markets, although higher gambling duties and taxation placed pressure on profitability.

The company said the revenue performance was ahead of its expectations. Online net gaming revenue increased 7% on a constant-currency basis while retail revenue rose 1%. Growth was supported by stronger customer engagement, product improvements and continued execution across established markets.

The figures provide an important indication of the progress being made under Entain’s current strategy. The group has been focused on improving operational execution while concentrating investment on markets where it believes it can generate sustainable returns.

The first-half performance also came during a period of significant regulatory and fiscal change. In the UK, the Remote Gaming Duty rate increased from 21% to 40% from 1 April 2026. This change has created additional pressure for operators with significant exposure to remote gaming.

Online operations remain a key growth driver

Online operations were among the strongest contributors to Entain’s first-half performance. The 7% constant-currency increase indicates continued momentum across the company’s digital betting and gaming businesses.

The UK and Ireland were particularly important to the overall result, with Entain reporting double-digit growth across both sports and gaming. The company also pointed to Australia and Canada as important contributors to its performance during the period.

In Spain, online net gaming revenue increased 28% on a constant-currency basis, making the market one of the strongest performers within Entain’s European operations.

The company attributed part of the progress to product development and improvements to its customer-facing platforms. Its work around major sporting events also supported engagement, with the group highlighting improvements to sportsbook and application experiences in Australia.

For Entain, the importance of these developments extends beyond a single reporting period. Improvements in product functionality, customer experience and technology can help the group compete more effectively while supporting its broader objective of generating organic growth.

Stella David highlights player engagement

Stella David, Chief Executive Officer of Entain, said:

“I am pleased with Entain’s start to 2026 with strong momentum and volume growth continuing as well as strong player engagement across the Group throughout the World Cup tournament. This performance reflects our strengthening operations and focused execution which reinforces the resilience of our globally scaled business and its ability to consistently deliver high-quality growth.”

David has been Entain’s permanent CEO since April 2025, following her earlier periods serving as interim chief executive. Her current leadership has been closely associated with the group’s efforts to strengthen operational performance and improve execution.

The company’s recent strategy has placed greater emphasis on organic growth, margin expansion and cash generation. Its 2025 results also reaffirmed the objective of producing at least £500m of annual adjusted cash flow from 2028.

Higher gambling duties affect profitability

Although revenue increased, Entain’s earnings performance was more subdued. Underlying EBITDA declined 2% to €560.7m (£479.3m), compared with €571.8m (£488.7m) in the comparable period.

The company attributed the decline primarily to higher gambling duties in the UK and other markets. The UK tax changes are particularly significant because Remote Gaming Duty increased to 40% from April 2026.

Entain’s tax charge increased to €67.6m (£57.8m) from €22.8m (£19.5m). The underlying effective tax rate also increased to 34.4% from 30.3%.

Tax receipts more than doubled to €108.9m (£93.1m), compared with €49.1m (£42m) in the previous corresponding period. These figures demonstrate how changes in the fiscal environment can affect earnings even when underlying customer activity and revenue remain positive.

Underlying operating profit declined 10% to €372.1m (£318.9m). Group operating profit was €154.3m (£131.9m), while gross margin moved down to 60%.

The company also recorded €218.8m (£187m) in separately disclosed items. These included €112.5m (£96.1m) relating to legal and onerous contract provisions connected with German player claims.

From a legal and reporting perspective, such provisions should be understood as accounting items recorded in the company’s financial statements. Their inclusion does not by itself establish the merits or outcome of any underlying claims.

Despite the pressure on operating earnings, Entain returned to a pre-tax profit of €54.3m (£46.4m), compared with a pre-tax loss of €77.6m (£66.3m) a year earlier. The loss after tax narrowed to €13.3m (£11.4m), from €100.4m (£85.8m).

Brazil remains a challenging market

Brazil continued to represent a weaker part of Entain’s international portfolio during the first half. Net gaming revenue declined 25% on a constant-currency basis.

Entain said the comparison was affected by adverse sports margins in the first quarter. At the same time, the company reported signs of continued customer activity, with sports wagers increasing 10% during the first half.

Rather than prioritising market share at any cost, Entain said it intends to focus on returns in Brazil. Sportingbet remains a central brand within its Brazilian strategy.

This approach reflects a broader shift in the online betting industry towards more disciplined customer acquisition and profitability. Highly competitive markets can generate significant volumes while still producing weaker financial returns if promotional spending and customer acquisition costs remain elevated.

Entain’s stated focus therefore appears to be on balancing growth with financial discipline. The approach could result in slower headline expansion in some periods but may provide greater emphasis on the quality and sustainability of revenue.

Entain continues its strategic exit from CEE

Another important development during 2026 has been Entain’s phased exit from Central and Eastern Europe.

In June, Entain announced an agreement to sell an initial 20% interest in Entain CEE to its joint venture partner EMMA Capital for approximately €425m. The transaction implies an enterprise value of approximately €2.1bn for Entain CEE. Completion is expected in the fourth quarter of 2026, subject to regulatory approvals.

The transaction forms part of Entain’s broader decision to pursue an exit from its remaining interest in the CEE business. According to the company, the proceeds are intended to support debt reduction.

Entain CEE generated €314.7m (£269m) in net gaming revenue and €111.2m (£95m) in underlying EBITDA during the first half, according to the figures provided in the company’s results.

Entain has indicated that proceeds from a complete exit could help reduce group reported leverage below 3x. The company has also said that excess capital could subsequently be returned to shareholders.

The CEE transaction is therefore not simply a portfolio adjustment. It is linked to Entain’s wider capital allocation strategy and its stated objective of strengthening the balance sheet while focusing resources on businesses with attractive long-term prospects.

Full-year guidance remains unchanged

Despite the mixed effect of revenue growth and higher taxation, Entain maintained its guidance for 2026.

The group continues to expect online net gaming revenue growth of 5% to 7% on a constant-currency basis. Underlying EBITDA guidance remains at €1.06bn to €1.12bn, equivalent to approximately £910m to £960m.

Maintaining guidance following the first-half results suggests that management continues to see sufficient momentum in its core operations to offset some of the pressure from taxation and weaker performance in individual markets.

The longer-term cash-generation target also remains important. Entain has reiterated its objective of reaching approximately €585m (£500m) in annual adjusted cash flow from 2028.

The target forms part of a broader financial strategy that places greater emphasis on converting operational improvements into sustainable cash generation. Entain’s 2025 reporting similarly highlighted adjusted cash flow of £151m and confidence in reaching at least £500m from 2028.

A more disciplined growth strategy

The first half of 2026 presents a mixed but broadly constructive picture for Entain. Revenue growth remained positive across the group, online operations performed particularly well and several major markets delivered strong momentum.

At the same time, the figures show that revenue growth does not automatically translate into higher earnings. Changes in gambling taxation have become an increasingly important factor for the economics of regulated betting and gaming businesses.

The UK provides a clear example. The increase in Remote Gaming Duty from 21% to 40% from April 2026 represents a substantial change in the tax environment for remote gaming operators.

Entain’s response has been to maintain its focus on operational efficiency, product improvements and disciplined market participation. Its approach in Brazil demonstrates this strategy, while the planned reduction of its CEE exposure represents a more structural portfolio decision.

For investors and industry observers, the next stage will be to assess whether stronger online momentum can continue through the second half while the company manages taxation, market competition and capital allocation.

Conclusion

Entain’s first-half 2026 performance illustrates both the opportunities and pressures facing a large regulated betting and gaming group. The 5% increase in net gaming revenue to €3.0bn demonstrates that the company continues to generate growth across important markets, with online operations providing much of the momentum.

However, the decline in underlying EBITDA shows that the quality of growth must be considered alongside the headline revenue figures. Higher gambling duties, particularly in the UK, are changing the financial landscape and increasing the importance of cost discipline and efficient capital deployment.

The company’s decision to maintain its full-year guidance indicates continued confidence in the underlying business. At the same time, the planned divestment of part of Entain CEE signals a willingness to reshape the portfolio and direct capital towards balance-sheet improvement and longer-term value creation.

With Stella David leading the group, Entain is continuing to emphasise operational execution, customer engagement and sustainable growth. The remainder of 2026 will be important in determining whether the stronger online performance seen in the first half can be maintained while the company navigates higher taxation and increasingly competitive regulated markets.

Overall, the results point to a business that is pursuing growth with greater financial discipline. The combination of stronger digital performance, portfolio optimisation and a continued focus on cash generation could remain central to Entain’s strategy as it moves towards its longer-term financial objectives.

FAQs

What did Entain report for the first half of 2026?
Entain reported a 5% increase in group net gaming revenue to €3.0bn (£2.55bn) for the first half of 2026.

How did Entain’s online revenue perform?
Entain’s online net gaming revenue increased 7% on a constant-currency basis during the first half of 2026.

Which European market delivered particularly strong growth?
Spain was one of the strongest European markets, with online net gaming revenue increasing 28% on a constant-currency basis.

Why did Entain’s underlying EBITDA decline?
Underlying EBITDA declined 2% to €560.7m, with higher gambling duties identified as a major factor affecting earnings.

What happened to Remote Gaming Duty in the UK?
The UK Remote Gaming Duty rate increased from 21% to 40% from 1 April 2026.

How did Entain perform in Brazil?
Brazil was a weaker market during the first half, with net gaming revenue down 25% on a constant-currency basis. Sports wagers nevertheless increased 10%.

What is happening with Entain CEE?
Entain agreed to sell an initial 20% interest in Entain CEE to EMMA Capital for approximately €425m as part of a planned phased exit from the business.

Who is the CEO of Entain?
Stella David is the Chief Executive Officer of Entain. She was appointed permanent CEO in April 2025.

Did Entain change its 2026 guidance?
No. Entain maintained its full-year 2026 guidance, including online NGR growth of 5% to 7% and underlying EBITDA of €1.06bn to €1.12bn.

What is Entain’s longer-term cash-flow target?
Entain has reiterated its objective of generating at least £500m in annual adjusted cash flow from 2028.