Playtech expects 2026 adjusted EBITDA to exceed €300 million

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The Backstory

Americas momentum reset expectations

Playtech’s latest upgrade to its 2026 earnings outlook marks the second time this year that the gambling software supplier has had to recalibrate market expectations around the same core theme: the Americas are now central to its growth story. The company’s forecast for adjusted EBITDA above €300 million builds on a guidance increase issued in July, when Playtech lifted its full-year 2026 outlook to at least €270 million after what it called excellent first-half trading.

That earlier update already showed a business running well ahead of analyst forecasts. At the time, Playtech said first-half adjusted EBITDA would exceed €155 million, supported by performance in the U.S., Mexico, Colombia and parts of Europe. The company’s latest comments suggest that momentum continued through October, with the Americas still providing the main earnings engine even as management warned that some of the factors behind the surge may not repeat at the same scale in 2027.

The pattern is important because Playtech has spent several years repositioning itself around regulated and regulating markets while reducing exposure to consumer-facing assets. Its results now show the benefit of that shift, but also the risks of relying on fast-moving jurisdictions where product cycles, tax policy and regulation can change quickly.

Hard Rock partnership became the catalyst

The strongest single driver has been Playtech’s relationship with Hard Rock Digital, particularly in the U.S. The company’s first-half results showed how quickly one successful product can reshape a supplier’s earnings profile. In September, Playtech reported a 472% jump in adjusted post-tax profit for the first half of 2026, with revenue rising 10% to €425.1 million and adjusted EBITDA climbing 77% to €162.5 million.

The U.S. and Canada division delivered revenue growth of 161%, driven largely by games based on past motor racing results with Hard Rock Bet in Florida. Playtech also expanded in Connecticut, its sixth regulated U.S. iGaming state, and launched or deepened relationships with Fanatics, FanDuel, DraftKings and Bet365. In Canada, it added Superbet in Ontario and benefited from growth with DraftKings and FanDuel, while Alberta’s move toward regulation created another market to fold into its regulated footprint.

That performance illustrates the upside of Playtech’s B2B model: once a product gains traction with a large operator in a high-value market, profitability can scale quickly. But the same first-mover advantage that boosted 2026 results also creates a short shelf life. Playtech has already warned that rivals are launching similar past-results products in the U.S., a development expected to dilute its wallet share in 2027.

Latin America remains opportunity and risk

Latin America has been central to Playtech’s long-term pitch, though the region has become more complex. Earlier this year, the company flagged regulatory headwinds in Latin America, pointing to Brazil’s transition to a regulated gambling market and Colombia’s introduction of VAT on gambling products. Even then, management stressed that it remained optimistic about the region’s medium-term opportunities.

Mexico has been especially important because of Caliplay, Playtech’s joint venture with Caliente. The partnership had previously been strained by payment disputes, but a new strategic agreement that took effect at the end of March gave Playtech a clearer route to dividends on its 30.8% stake. Strong growth in fees from Caliplay helped support the company’s broader Americas performance and reinforced the importance of local partnerships in markets where regulation and payments infrastructure can be difficult to navigate.

The newest risk is Brazil. Playtech had been investing there with the expectation that the market would begin contributing revenue from 2027. Instead, the company now faces disruption after President Luiz Inácio Lula da Silva signed a provisional measure banning fixed-odds sports betting and online casino games nationwide. Playtech said it can absorb about three months of disruption in 2026, but a prolonged ban would have a more meaningful impact in 2027.

That timing matters. Brazil had been seen across the sector as one of the most significant emerging regulated markets, and suppliers built assumptions around licensing, tax collection and operator demand. If the ban remains in place, Playtech’s medium-term Latin American growth curve would be flatter than previously expected, even if Mexico and Colombia continue contributing.

A leaner Playtech after Snaitech sale

The earnings upgrade also comes after a major portfolio shift. Playtech completed the sale of Italian gaming company Snaitech to Flutter Entertainment on April 30 for €2.3 billion. The deal represented a nearly threefold increase on the €846 million Playtech paid for Snaitech and gave the company room to return €1.8 billion to shareholders through a special dividend.

The transaction was consistent with Playtech’s push to become a more focused B2B supplier. Without Snaitech, the company’s valuation narrative depends more directly on software, platform, live casino and content growth, rather than consumer-facing Italian retail and online operations. That can produce higher-quality earnings if regulated-market expansion continues, but it also leaves the company more exposed to operator concentration and regulatory shocks in key B2B markets.

The first-half results suggest the strategy is working financially. Free cash flow reached €101 million in the period, despite a decline in net cash after a €25 million share buyback. The company’s ability to convert growth into cash is one reason analysts and investors are focused less on near-term revenue and more on whether the elevated EBITDA base is sustainable beyond the current product cycle.

Legal dispute adds governance overhang

Alongside the commercial story, Playtech is dealing with a reputational and legal challenge involving rival Evolution. In October, Evolution said Playtech had been involved in an alleged campaign linked to a 2021 report produced by private intelligence firm Black Cube. The allegations triggered sharp market reaction after Playtech was named in the alleged smear campaign against Evolution.

The dispute stems from a report that accused Evolution of operating in unregulated jurisdictions and supplying unlicensed operators. Evolution says the report was defamatory and produced through deceptive tactics. A New Jersey court has found the report false and designed to harm Evolution for competitive advantage, according to Evolution’s account.

Playtech has denied wrongdoing. In a follow-up statement, Playtech rejected Evolution’s smear campaign allegation, saying its subsidiary commissioned the investigation lawfully in response to concerns raised by industry participants about regulatory and commercial risks. The company said it stands by the decision to commission the report and expects the proceedings to test the credibility of the underlying claims.

The legal fight is unlikely to determine Playtech’s 2026 EBITDA, but it may influence investor perception at a time when the company is asking the market to look through 2027 headwinds. For a supplier operating in heavily regulated markets, governance and trust are not abstract issues; they affect licensing relationships, operator partnerships and the cost of capital.

Higher taxes and competition shape 2027

The central tension in Playtech’s outlook is that 2026 is increasingly strong while 2027 looks less certain. The company has identified three main pressures: Brazil’s ban, intensifying U.S. competition in past-results products and higher taxes in Europe, including the full-year effect of the U.K.’s increased Remote Gambling Duty.

Those pressures explain why analysts’ 2027 adjusted EBITDA expectations are materially below Playtech’s upgraded 2026 target. They also frame the stakes for management. Playtech has demonstrated that its slimmer, B2B-focused model can generate rapid profit growth when products, partners and regulation align. The next test is whether it can replace one-off advantages with a broader base of recurring earnings across multiple regulated markets.

For investors, the story is no longer simply whether Playtech can grow in the Americas. It has already shown that it can. The more important question is how durable that growth will be once competitors close the product gap, governments revisit tax policy and Brazil’s regulatory path becomes clearer.