Entain CEO Stella David believes Brazil will reinstate betting and expects to return to the market with the Sportingbet brand.
On September 25, Brazil’s President, Luiz Inácio Lula da Silva, signed a decree banning sports betting and online casinos in the country, an activity that his own government had regulated just a few years earlier.
The measure forced all companies licensed by the Secretariat of Prizes and Betting (SPA), including Entain, to suspend their operations in the country. And the situation doesn’t seem likely to be resolved soon.
Today (October 15), during the presentation of its third-quarter financial results, Entain referenced the impact of the regulated market’s closure on its performance. Even though the ban didn’t take effect until late in the quarter, the operator’s net gaming revenue in Brazil fell 36% year-on-year.
However, David expressed optimism about the future. She said that Entain is confident in its position within the Brazilian market and highlighted both the track record and the value of the Sportingbet brand.
She also explained that Sportingbet is a brand primarily focused on sports (approximately 70% of the business), meaning the company is well positioned to handle a possible scenario in which online casinos remain banned.
“Our intention is to resume operations in Brazil,” David said. “If the market reopens, but is limited solely to sports betting, I think we are well prepared.”
“If it reopens with advertising restrictions, we are also well positioned, thanks to the value of our brand,” she added.
“I think that, one way or another, the regulated market in Brazil will be up and running again,” she predicted.
Entain is betting on caution
Despite its interest in resuming operations in Brazil, David noted that Entain will take a “sensible” approach to investment, given the recent volatility.
She also pointed out that the company had already adopted a “pragmatic” strategy before the ban, focusing on high-value customers rather than “chasing volume at any cost.”
The operator is prioritizing a “disciplined approach to marketing and player retention” in the country.
Currently, Entain has a relatively small team in Brazil, whose members are working on other areas of the business while they wait for greater clarity on the sector’s direction.
“Once the market opens, we’ll maintain a conservative approach so as not to operate at a loss in an environment where it’s very hard to predict the future,” David noted.
UK tax hike hits the sector
Beyond Brazil, Entain’s CEO also referred to the situation facing the industry in the UK, where the remote gaming duty rose from 21% to 40% in April of this year. Additionally, starting in 2027, a new 25% tax rate will apply to most online bets.
The UK accounts for a large share of Entain’s activity, both in physical shops and online gaming. Net gaming revenue for the Ladbrokes owner in the British market rose 8% during the third quarter, driven by a 14% increase in revenue from the online channel.
Meanwhile, retail sector revenue saw a slight year-on-year increase; although David warned that activity could be affected by the tax measures currently in force.
In this regard, David stressed that a further tax increase on the sector could lead to the closure of approximately 1,500 betting shops and the loss of 16,000 jobs.
“It’s important that the message is clear: tax hikes lead to shop closures, unemployment, and lower tax revenue,” she stated.
Last month, Entain confirmed that it was planning to cut 400 jobs to deal with the impact of the sector’s tax increase.