Evolution CEO Martin Carlesund states that the group can reopen quickly and that the second round of the presidential election will bring more clarity.
During the Q3 2026 earnings call, held on October 23, Carlesund described the closure as “very unfortunate”.
In his view, the case shows how “a populist agenda can bring down a regulatory framework that had been in place for just a year and a half”.
The studio closed on October 5, after the end of the reporting period. According to Carlesund, this will make the fourth quarter “less smooth” than the third. The executive declined to speculate on the outcome, but directly linked it to Brazil’s political calendar.
“We’ll know more after the second round of the election this weekend,” he said, referring to the October 25 vote.
Growth in Latin America still unaffected by the ban
Latin America was one of Evolution’s strongest regions in the quarter. Revenue in the region grew 23.1% year-on-year, according to the group’s estimate based on players’ IP addresses. Carlesund noted that the figure “does not include any effect” from the ban in Brazil.
“If Brazil reopens the market, we are ready to accelerate,” he said.
In the interim report, Evolution stated that Brazil accounts for “well under half” of Latin American revenue. It added that strong momentum in the rest of the region should offset part of the impact.
On the earnings call, Carlesund said the group plans to expand in Colombia and gain traction in Argentina, where it operates two studios.
According to him, the effect on other Portuguese-speaking markets served by the Brazilian studio is, for now, “marginal”.
Questions over Q4 Brazilian revenue
Three analysts asked whether Evolution’s revenue in Brazil would fall to zero in the fourth quarter. Each time, Carlesund replied that the country has no ring-fencing.
He did not say whether Evolution would continue to receive revenue from Brazilian players through operators licensed in other jurisdictions. “Let’s see what happens with the players,” he said.
Andrew Tam, of Rothschild & Co Redburn, asked whether the absence of ring-fencing could make the closure positive for the supplier. Carlesund rejected the idea.
“I think everyone is baffled by the situation in Brazil,” he said. “It’s entirely negative for anyone in this industry for this to happen this way.”
“A new situation”
Ben Shelley, of UBS, asked whether India, where a regulatory change caused volatility in Q3 and Q4 2025, served as a comparison. Carlesund said Brazil is different.
“I think this situation is new: it’s very abrupt, in a regulated market where operators paid for five-year licenses,” he said. “It’s very hard to say where this will end.”
According to him, Evolution’s immediate priorities are its employees in the country and the practical consequences of the closure.
Margin target maintained
Carlesund did not say how much of Evolution’s costs in Brazil could be cut in the short term. According to him, the group doesn’t even know whether it will reopen.
The CEO confirmed that the full-year margin guidance remains unchanged, even if Brazil generates little or no revenue for the group in the fourth quarter. Year-to-date, Evolution’s EBITA margin stands at 65.7%, against an annual target of 66%.
Rasmus Engberg, of Kepler Cheuvreux, asked what portion of costs is variable. Carlesund did not give a figure and said the company is “quick to adapt and quick to adjust” when circumstances change.
In his view, the case follows a broader pattern. “It’s not the first time that a single market has gone through volatility or uncertainty, and I’m sure it won’t be the last,” he said.
Group performance
On a consolidated basis, Evolution reported revenue of €526.1 million in the third quarter, up 3.7% year-on-year, and adjusted EBITA of €345.9 million, with a margin of 65.8%. RNG revenue grew 10.1%, and live casino revenue grew 2.6%.