Betsson Operating Income Drops 47 Percent as Rising European Tax Burdens and B2B Stalls Erase Profits

Betsson AB reports a 47% drop in EBIT for Q1 2026, citing Swedish tax hikes and B2B setbacks despite a 24% revenue increase in Latin America.

By: AXL Media

Published: Apr 24, 2026, 10:55 AM EDT

Source: Information for this report was sourced from Gambling Insider

Fiscal Headwinds and Market Misses Define First Quarter Results

Betsson AB reported a significant across the board miss for its first quarter 2026 earnings, failing to meet analyst expectations for revenue, earnings per share, and operating income. The group’s revenue of 285 million euros fell short of the projected 298 million euros, while earnings per share came in 26 percent off target. Most notably, while total revenue saw a modest 3 percent year on year decrease, operating income experienced a drastic 47 percent decline. Management attributed this sharp drop to the high costs associated with funding future growth in several currently unprofitable B2C markets.

Regulatory Transition Increases Fiscal Pressure on European Operations

The group has successfully shifted its revenue mix toward a record 73 percent from locally regulated markets, up from 59 percent in the previous year. While this transition improves the long term quality of earnings, it has resulted in a substantially heavier fiscal burden. Gaming taxes paid by the firm surged 17.7 percent year on year to 53 million euros. More stringent regulatory oversight and significant tax increases in jurisdictions like Sweden have squeezed margins, particularly in Western Europe and the Nordics, where the fiscal downside was most pronounced.

Regional Revenue Collapse in Central and Eastern Europe

Betsson faced a 21 percent collapse in revenue within its Central and Eastern Europe and Central Asia (CEECA) division, which fell to 96 million euros. Analysts noted a concerning trend where high margin revenue from gray market regions is being displaced by lower margin revenue from newly regulated territories. This regional slump was further exacerbated by a plateauing of organic growth that had been observed throughout 2025. The shift in regional focus has forced the company to reevaluate its strategic priorities as it balances regulatory compliance with profitability.