Betting giants Flutter and Entain have warned over a hit to annual results after Brazil’s shock move to ban online gambling.
Paddy Power and Betfair owner Flutter joined Ladbrokes and Sportingbet rival Entain in hitting out at the sudden decision by Brazilian President Luiz Inacio Lula da Silva on Friday to sign an order that “prohibits all sports betting and online casinos”.
Flutter, which is now listed in New York, said it would be facing a full-year revenue impact of around 70 million US dollars (£52.8 million) and a blow to underlying earnings of about 20 million dollars (£15.1 million) if its Brazilian operations are shut down for the rest of 2026.
Ladbrokes and Sportingbet owner Entain cut its online sales outlook and said earnings will be at the lower end of guidance because of the decision.
The measure was put into place amid efforts in Brazil to clamp down on surging levels of gambling addiction across the country.
Entain said it was “disappointed” with the announcement, which it said was made “without consultation of industry stakeholders regarding its significant adverse consequences”.
The London-listed firm said it would comply with the provisional ban, which must now secure congressional approval within 120 days to become permanent.
Entain downgraded its full-year online net gaming revenues outlook to between 4% to 6% as a result of the ban and said underlying earnings were now expected at the lower end of its guidance for between £910 million and £960 million.
Brazil was expected to account for around 5% of its total online net gaming revenues this year, though it said the earnings contribution was forecast to be “modest” because of the “challenging and highly competitive operating environment” in the country.
Shares in FTSE 250 listed Entain fell 4% in Monday afternoon trading.
Flutter said it was also “extremely disappointed” with the Brazilian betting ban and was “reviewing all available options, including the potential to appeal”.
It said: “Flutter continues to engage constructively with the Brazilian authorities on sensible, effective regulation to protect customers from the risks of the unregulated market.”
It said that Flutter Brazil’s carrying value was largely made up of 539 million dollars (£407 million) in goodwill, 127 million dollars (£96 million) in online customer relationships, 124 million dollars (£94 million) in trademarks and 31 million dollars (£23 million) for computer software and technology.
The blow compounds a number of headwinds facing the firms, which have been under pressure amid tax rises in the UK.
Earlier this month, Entain revealed around 400 jobs were being cut worldwide as it blamed increased gambling taxes and warned more could be at risk amid speculation the Chancellor is planning to double machine games duty in the Budget.
The group, which also owns brands including Coral, said it had launched a consultation that could see a fifth of its 2,000-strong customer care jobs go across 11 countries, including the UK, as part of ongoing efforts to “address the impact of the UK’s increased gambling taxes”.
It did not reveal how many jobs would go in the UK as part of the consultation, which is set to end by November.
