Evolution, a leading global online gaming provider, has released its financial results for the second quarter of 2025, revealing a mixed picture of modest revenue growth amid profitability challenges. The company posted total net revenues of €524 million ($607.4 million), marking a 3.1% year-over-year increase, while adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) remained largely flat at €345.3 million, reflecting a margin contraction to 65.9% from 68.0% in Q2 2024.
Despite the revenue uptick, Evolution’s profit for the quarter declined by 7.7% to €248.3 million, with earnings per share falling to €1.22 from €1.28 the previous year. CEO Martin Carlesund acknowledged the financial pressures but expressed cautious optimism about the company’s trajectory. “To be clear though, we are not satisfied with this quarter’s growth, and we are working hard to increase the pace. However, operationally speaking we are where we set out to be at the beginning of the year,” he said during the July 17 earnings call.
One of the key factors weighing on profitability has been Evolution’s proactive regulatory positioning, particularly in Europe. Following a December 2024 investigation by the UK Gambling Commission (UKGC) into the company’s provision of games to unlicensed operators, Evolution adopted geolocation blocking technology across Europe in Q1 2025. This move, aimed at restricting access to licensed markets only, led to the company exiting black and grey markets, which negatively impacted earnings. Carlesund noted that the financial hit from geo-blocking was more severe than initially anticipated but was less pronounced in Q2 compared to Q1.
“On top of what we have already done in the UK to meet regulatory requirements, we have taken proactive and self-initiated actions in February to ring-fence additional regulated markets in Europe,” Carlesund explained. He also highlighted the delicate balance regulators must strike, warning that “a too heavily regulated market will cause a decrease in player protection and a reduced market for regulated companies.”
Europe’s revenue fell 5.8% year-on-year to €180.2 million in Q2, reflecting the financial impact of these ring-fencing measures. However, Carlesund reaffirmed his belief that regulation is ultimately positive over time, fostering greater market trust and stability.
Meanwhile, Asia presented a brighter picture for Evolution. The company’s revenue in the region rose 4.2% year-over-year to €209.1 million, marking a return to growth after several quarters of stagnation caused by cyberattacks and hijacked video streams. Evolution has invested heavily in cybersecurity to protect its intellectual property and product streams, with Carlesund emphasizing that the company is “at the absolute technological forefront” of such defenses. The opening of Evolution’s first Asian studio in the Philippines in June 2025 further underscores the company’s commitment to expansion in this high-growth market.
Latin America also showed steady progress, with Q2 revenue of €37.6 million, up 2.7% year-over-year. Evolution recently launched a new state-of-the-art studio in São Paulo, Brazil, timed to capitalize on the country’s transition to a regulated iGaming environment earlier in 2025. The Brazilian market is seen as a significant growth opportunity, with industry estimates suggesting it could add €100 million in annual revenue by 2026. This studio, along with others in Colombia and the Czech Republic, forms part of Evolution’s strategic focus on expanding its footprint in regulated markets worldwide.
North America remains a key growth driver, with revenue soaring 22.9% year-over-year to €74.0 million. Evolution has cemented its presence in all seven U.S. states currently offering regulated online casino gaming, thanks in part to a new partnership with Bally’s Corporation in Rhode Island and plans for a new studio in Grand Rapids, Michigan. The anticipated acquisition of Galaxy Gaming, valued at $85 million and boasting 131 global licenses, is expected to further strengthen Evolution’s U.S. operations and its portfolio of table games.
On the product front, Evolution is maintaining a robust development pipeline, with more than 110 new games scheduled for release in 2025, including four new live casino titles and 20 online slots launched in Q2. The company also expanded its licensing agreement with Hasbro, preparing to introduce Monopoly Live and other branded games in the U.S. market, signaling ongoing innovation and diversification of its offerings.
Operating expenses rose 10.4% to €218 million in Q2, driven largely by investments in new studios and regulatory compliance. Personnel costs increased by 27% year-over-year, reflecting the company’s expanding workforce, which grew 21% to 21,141 employees. These investments, while pressuring margins in the short term, are part of Evolution’s strategy to secure long-term dominance in the regulated online gaming sector.
Despite the challenges, Evolution has maintained its full-year EBITDA margin guidance of 66–68%, underscoring confidence in its ability to navigate current headwinds. The company’s fortress balance sheet, with approximately €950 million in cash, and a $400 million share buyback program further signal financial strength and shareholder commitment.
Carlesund summarized the company’s position by acknowledging the difficulties but emphasizing the groundwork laid for future growth: “I am not satisfied with the financial development during the first half of 2025, but I am very satisfied with how we are addressing our challenges. Even though the quarter is not financially brilliant, it is — on a total level — in line with where we foresaw we would be when initiating measures to address our challenges, given all the outside norms and circumstances. 2025 will be a great year for Evolution, even if not financially our best, but a year where we lay the foundation necessary to keep our growth trajectory going forward.”
Following the earnings release, Evolution’s shares surged nearly 7.5% in early trading, reflecting investor confidence in the company’s strategic direction despite short-term margin pressures.
In a sector marked by regulatory complexity and technological threats, Evolution’s blend of proactive compliance, geographic expansion, and product innovation positions it well to capitalize on the global shift toward regulated online gaming markets. While challenges remain, particularly in Europe and North America, the company’s disciplined approach and strong cash flow generation suggest it is primed for sustainable growth in the years ahead.
