The quarterly earnings season for gaming stocks kicked off last week, intensifying this week with key reports from companies like Las Vegas Sands, Boyd Gaming, and Monarch Casinos.
In the investment landscape, the Roundhill Sports Betting & iGaming ETF saw a slight decline of 1.6% last week, aligning with the movements of the S&P 500 Index. Notable performers included the Star Entertainment Group and Bally’s Corporation, both of which gained, while Bragg Gaming Group and Robinhood experienced significant losses.
**Major Gainers**
**The Star Entertainment Group (ASX: SGR) +10%**
Star Entertainment led the gains among gaming stocks, marking the only double-digit increase in coverage last week. The rise came without any major announcements, suggesting a technical rebound and short-covering following earlier declines. Despite last week's surge, Star’s shares are down nearly 39% year-to-date. The company is currently managing a challenging debt situation, highlighted by its recent sale of a 50% interest in the Queen’s Wharf Brisbane project and a $390 million debt facility secured earlier this year with WhiteHawk Capital Partners to stabilize liquidity.
The stock, viewed as speculative, has notable stakes held by US-based Bally’s Corporation and the Bruce Mathieson family, reinforcing its turnaround potential amidst ongoing financial challenges. Recent shifts in the operating headquarters of Betr Entertainment to Tasmania due to its more accommodating regulations have also attracted attention within the Australian gaming landscape.
**Bally’s Corporation (NYSE: BALY) +9.08%**
Bally's Corporation rose by over 9% last week, narrowing its year-to-date losses to just under 15%. This increase signals a recovery, as the stock had previously been listed among the biggest losers. Last week’s rebound was attributed to an oversold condition following a decline.
The company is pursuing significant long-term projects, including a $1.7 billion permanent casino in Chicago set to open in 2027, and a $4 billion resort in the Bronx, New York, which involved a $500 million gaming license fee earlier in the year. These developments have contributed to a growing debt load, prompting Fitch to adjust its outlook from “stable” to “negative” for the company.
**Light & Wonder Inc (ASX: LNW) +5.26%**
Light & Wonder's stock increased by over 5% last week, with management confirming its aim to meet its 2026 growth guidance predicting mid-to-high single-digit growth in adjusted EBITDA. The company committed to reducing its leverage ratio, projecting it will settle within its target range this year and fall below 3x in the first half of the following year. In Q2, Light & Wonder repurchased over 1.6 million CHS interests costing $134 million, retaining about $180 million for further repurchases under its current plan.
**Biggest Losers**
**Bragg Gaming Group (NYSE: BRAG) -15.42%**
Bragg Gaming was the most notable loser last week, sinking over 15%. This decline came after the stock previously surged following a series of operational restructuring efforts, notably a workforce reduction of approximately 19%. The initiatives are expected to generate annualized savings of €6 million, in addition to €4.5 million from an earlier restructuring. Despite initial positivity, last week’s broader market downturn led to a reversal of gains.
**Robinhood Markets (NYSE: HOOD) -10.73%**
Robinhood faced a turbulent week, falling over 10% amid risk-off sentiment striking tech and fintech sectors. The stock has been volatile this year, swinging between being a top performer and a notable loser. Although Robinhood is diversifying beyond crypto and stock trading towards prediction markets, the majority of its profits still depend on those sectors, leading to sell-offs during downturns.
The company has introduced Robinhood Earn, a decentralized lending product, alongside new stock tokens for 24/7 trading on the newly established Robinhood Chain. Despite potential long-term advantages, profit-taking occurred in anticipation of the upcoming Q2 earnings report.
**Betr Entertainment (ASX: BBT) -7.89%**
Betr Entertainment, which had previously seen gains, experienced a nearly 8% drop tied to profit-taking. With a market cap below AUD 200 million, the stock is prone to volatility, illustrated last Friday when trading volume dipped significantly, exacerbating price drops from limited demand.
**Major Gaming Industry Developments Last Week**
In regulatory news, Evolution settled a £4.75 million ($6.4 million) charge with the UK Gambling Commission for supplying game content to unlicensed operators. In a notable legal ruling, the Court of Justice of the European Union stated that YouTube could lose its legal protections concerning gambling channels, ramping up pressure on platforms to regulate unauthorized gaming content.
Stateside, DraftKings initiated legal action against Philadelphia over a local consumer protection inquiry into its sportsbook and casino operations, arguing the city exceeded its regulatory authority.
**Prediction Market Developments**
In Michigan, a temporary ban on Kalshi's sports contracts was extended by Judge Rosemarie Aquilina, allowing the company until August 12 to implement geo-blocking measures, or face potential penalties of $0.5 million per day. Despite uncertainties, prediction markets are thriving, highlighted by OpenAI’s partnership with Kalshi to incorporate real-time prediction data into ChatGPT. Kalshi reportedly added 3 million new members during the FIFA World Cup, trading $1.2 billion on its platform, marking a significant uptick in engagement.
