Flutter Entertainment has revised its financial outlook for fiscal year 2026 due to disappointing sports results and the recent ban on betting in Brazil. The company reported a net loss of $1.15 billion for the third quarter, which concluded on September 30. While its revenue inched up by 2% to $3.87 billion, the results were overshadowed by $873 million in non-cash impairment charges tied to its Brazilian operations. This total was significantly higher compared to the $789 million loss recorded during the same quarter in 2025.
The prohibition of betting in Brazil, enforced by President Lula towards the end of September, accounted for $537 million of Flutter's post-tax impairment charge. This charge largely stemmed from Flutter’s 56% ownership stake in Flutter Brazil, a venture established last year in which the Paddy Power parent company invested $356 million to acquire it from NSX Group.
As a direct consequence of the ban, Flutter shut down its Betfair operations in Brazil and is now focusing solely on the Betnacional brand within the market. Additionally, Flutter saw its adjusted EBITDA drop by 25% to $360 million for Q3, prompting the company to revise its guidance. The midpoint of its full-year revenue forecast has been lowered by $300 million to $17.61 billion, while its adjusted EBITDA guidance has decreased by $160 million to $2.495 billion.
Dan Taylor, Flutter's CEO who took over from Peter Jackson on October 1, expressed disappointment regarding the ban in a letter to shareholders. "In response, we have acted decisively; our operations are currently closed, and we have paused all discretionary and uncommitted spending," Taylor noted. He added that Brazil still represents a potential market for Flutter should the regulatory environment improve, while emphasizing the need for prudent capital deployment as conditions change. On the post-Q3 earnings call, Taylor affirmed the company's readiness to resume operations if the market reopens.
In the U.S., Flutter's FanDuel brand experienced a 6% revenue increase, totaling $1.46 billion, driven by a 4% growth in sportsbook offerings and an 8% rise in iGaming. Despite this growth, FanDuel's adjusted EBITDA plummeted by 94% to just $3 million, attributed to investments in its prediction market features and its recent launch in Alberta, Canada. Taylor remarked that initiatives such as the FanDuel Rewards program have shown promising returns, helping to solidify the company's position in the competitive North American market. He emphasized the need for continued innovation and rapid operations to enhance Flutter's U.S. leadership.
The prediction markets are seen as a crucial growth avenue for Flutter, especially following the launch of FanDuel Predicts in December, which reported an average of 66,000 players monthly in Q3, marking a significant 39% increase from the previous quarter. Taylor pointed out that the surge in prediction market operators has influenced the overall marketing landscape in the U.S. betting sector, with media spending rising significantly.
In the UK and Ireland, Flutter announced a restructuring plan potentially impacting 1,400 jobs. The downturn in adjusted EBITDA for Flutter’s International segment, down 14%, was largely due to the steep increase in the UK’s remote gaming tax from 21% to 40%, enacted in April. However, Flutter's UK and Ireland revenue climbed by 4% to $889 million in Q3, stemming from a 12% rise in iGaming revenues, which balanced a 6% drop in sportsbook revenue.
Flutter continued to gain market share in the UK, and Taylor suggested that the reorganization would strengthen the company’s competitive positioning following the tax hike.
When evaluating performance across regions, Flutter noted that Southern Europe and Africa led in revenue growth, rising 13% to $836 million due to a robust 17% increase in iGaming. In contrast, the Central and Eastern Europe segment reported a 10% rise to $166 million, buoyed by market share growth in Georgia, Serbia, and Armenia. This growth partially cushioned a 4% revenue decline to $349 million in the Asia Pacific region, which Flutter ascribed to the capping of real-money gaming in India.
Looking ahead, Taylor signaled a shift towards a more streamlined operational model aimed at maximizing efficiency. He projected an additional $500 million in cost and capital savings by 2029, targeting improvements through artificial intelligence, organizational restructuring, and technology simplification. "Flutter has an exceptional set of assets and opportunities," he stated, stressing the importance of effective execution and timely decision-making to unlock their full potential.
