Evolution CEO Slams Brazil Betting Ban As Q3 Revenue Returns To Growth

Evolution CEO Martin Carlesund has strongly criticised Brazil's decision to suspend licensed betting operations, describing the regulatory uncertainty as a major setback for the gambling industry despite the company's return to revenue growth in the third quarter of 2026.

Speaking during Evolution's latest earnings call, Carlesund expressed frustration at the abrupt restrictions introduced by President Luiz Inácio Lula da Silva, which have forced the supplier to temporarily close its live casino studio in São Paulo.

“I think that everyone is flabbergasted about the situation in Brazil,” Carlesund told analysts. “It's a total negative for anyone in this business, that it happens in this way.”

He added: “It's highly unfortunate that a populist agenda can overthrow a regulatory framework that has only been in place for a year and a half.”

The comments came as Evolution reported third-quarter net revenue of €526.1 million, representing a 3.7% increase year-on-year, while adjusted EBITDA rose 2.7% to €345.9 million.

Evolution Prepared To Reopen Brazil Studio

Brazil's restrictions were announced in late September, less than two years after the country introduced its regulated online gambling market. The decision has created considerable uncertainty for licensed operators and suppliers that invested in the market following its launch.

Evolution opened its São Paulo studio in 2025 but has since suspended operations at the facility while awaiting greater clarity on the legal position.

The country's Supreme Federal Court is expected to consider a challenge to the constitutionality of the restrictions, although the timing and outcome remain uncertain.

Carlesund confirmed that Evolution could resume operations at short notice if circumstances change, with the company prepared to accelerate its Brazilian activities once the regulatory position becomes clearer.

Asked whether Evolution's Brazilian revenue could disappear entirely if the restrictions remain in place, he said: “The country as such is not ring fenced, and we will see what will happen with the players.”

He added: “The only comment I had is that we have to monitor the situation in Brazil. No one really knows what will happen. It could be reopened again.”

Despite the disruption, Evolution maintained its full-year adjusted EBITDA margin guidance of approximately 66%, even when questioned about the possibility of generating no Brazilian revenue during the fourth quarter.

Latin America remained one of Evolution's strongest-performing regions during Q3, recording year-on-year revenue growth of 23.1%. However, those figures largely preceded the impact of the Brazilian restrictions, which took effect in early October.

European Performance Disappoints Despite Revenue Growth

Evolution's third-quarter results showed improving momentum across several international markets, with all geographical regions recording quarter-on-quarter revenue growth for the first time since 2024.

North American revenue increased 13.6% year-on-year, while Africa recorded growth of 23.7%. Live casino revenue rose 2.6%, with the company's RNG division delivering stronger growth of 10.1%.

However, Europe continued to underperform, with revenue declining 4.7% compared with the corresponding period in 2025. Quarter-on-quarter growth was limited to 0.4%.

Carlesund described the region's performance as “not exciting” and acknowledged that Evolution needed to deliver stronger results.

“No matter the regulatory situation or low channelisation rates, we should do better,” he said.

The CEO suggested that frequent regulatory changes and tax increases across European markets had diverted attention away from commercial development and customer relationships.

He argued that greater stability would allow Evolution to concentrate on its core operations and improve performance, rather than continually adapting to changing regulatory requirements.

Cybercrime Continues To Affect Asian Operations

Evolution also reported continuing difficulties in Asia, where cybercriminal activity has affected the distribution of its gaming products.

Revenue in the region increased 0.8% quarter-on-quarter and 1.6% year-on-year, although the company acknowledged that progress in addressing the underlying security challenges remains gradual.

Carlesund previously warned that unauthorised parties were stealing Evolution's products, and the issue remains unresolved despite ongoing technical measures.

“There's no quick solution to these cybercrime issues that we continue to see,” he told analysts.

Evolution is continuing to invest in technical protections intended to prevent unauthorised distribution and strengthen control over its products.

“We are playing the long game, and I am confident that it will pay off,” Carlesund said, while acknowledging that regional performance could remain volatile as the measures are implemented.

Playtech Legal Dispute Remains Ongoing

Carlesund also addressed Evolution's continuing legal dispute with Playtech, which centres on allegations made following an investigation commissioned by Playtech in 2020.

The investigation, conducted by intelligence firm Black Cube, resulted in a report alleging that Evolution had supplied gaming products in prohibited and sanctioned markets.

Evolution has disputed the allegations and pursued legal action against Black Cube, while seeking to hold Playtech accountable in related defamation proceedings.

Asked for an update during the earnings call, Carlesund declined to discuss the substance of the dispute but confirmed that litigation was continuing.

“We are in a full lawsuit with them, and that will continue as we go forward,” he said. “We're doing everything we can, and now there's new steps taken every day.”

Evolution enters the final quarter of 2026 with revenue growth restored and its profitability outlook unchanged. However, the company's immediate prospects remain affected by Brazil's uncertain regulatory environment, continued weakness in Europe and the ongoing challenges surrounding unauthorised distribution in Asia.