No deal
Evolution nixes Galaxy deal but regulatory questions linger
‘Nothing to see here’ message on Galaxy fails to quell concerns.
In +More: Tencent reportedly in talks to acquire Playtika’s SuperPlay.
Earnings: Kambi and Hacksaw Gaming report.
Venture playground: Eccles’ BetHog closes, pivots to AI live casino.
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Not done, not dusted
Galaxy quest: Evolution said its decision to terminate its proposed acquisition of Galaxy Gaming will be financially and strategically immaterial, despite the company having to pay a $5.23m break fee.
But the collapse of the two-year-old transaction is likely to increase investor scrutiny of the regulatory issues surrounding the live casino supplier in both Nevada and the UK.
Let’s call the whole thing off: Evolution announced on Monday it had terminated the merger but provided no explanation for abandoning the acquisition, saying only that it expected to continue working with Galaxy under the companies’ existing commercial relationship.
The all-cash transaction was announced in July 2024 and valued Galaxy at $3.20 a share, representing a 124% premium to its previous closing price.
It valued the Las Vegas-based table games supplier at ~$85m on an equity basis and $124m including net debt.
Evolution originally expected to complete the acquisition by mid-2025 but that was subsequently extended to earlier this month after failing to obtain all the necessary regulatory approvals.
Brushed off: Speaking shortly before the contractual outside date last week, Evolution CEO Martin Carlesund acknowledged the company had devoted “significant time, effort and resources” to the process.
However, he insisted that due to Galaxy’s size the collapse of the deal would have no material impact on Evolution’s US operations or long-term ambitions.
That may be true financially, but the reasons why the deal failed to close now risk becoming more significant than the loss of Galaxy itself.
Nevada crossing: Questions over the transaction intensified in January after NEXT.io reported that regulatory approvals were understood to remain outstanding in Nevada and Louisiana.
The report followed new Nevada Gaming Control Board guidance that increased the expectations placed upon licensees regarding business conducted in jurisdictions where online gaming is prohibited or subject to enforcement action.
Rothschild & Co Redburn analysts argued at the time that Evolution could be forced either to implement additional ring-fencing of markets regarded as prohibited by Nevada or abandon the Galaxy acquisition.
They also suggested the Nevada regulator might wait for the outcome of the UK Gambling Commission’s review of Evolution before deciding whether to approve the deal.
Stumbling block: Evolution has not said whether Nevada’s regulatory position caused the transaction to fail but it does nonetheless represent a roadblock to its US ambitions. North American revenue reached €81m in Q2, increasing 9.5% YoY.
Evolution also opened its second Michigan studio and continued rolling out localized products across regulated US states.
The Galaxy deal was supposed to reinforce that expansion by adding a portfolio of proprietary table games.
Its termination therefore sits awkwardly alongside Evolution’s insistence that the US remains an important long-term growth opportunity.
Holes in the fence: The Nevada question also intersects with renewed concerns over Evolution’s controls in the UK. Evolution revealed last week that it had agreed to pay £4.75m to settle the UK Gambling Commission license review first disclosed in December 2024.
Evolution said the settlement primarily related to its content being offered to UK consumers by two operators across six websites without UK licenses.
It added that the review found no broader pattern of unauthorized UK access.
Carlesund described the settlement as “a bit high in relation to the actual issue” but said he was pleased to bring the matter to a close.
But, notably, the UKGC has yet to publish its own account of the settlement.
A game of skull: That absence is particularly relevant because a Rothschild note issued on July 10, before Evolution notified investors of the UK settlement, claimed to have identified fresh weaknesses in the supplier’s technical controls.
Following reporting by Investigate Europe concerning Soft2Bet, Rothschild tested whether the Evolution-owned Red Tiger games could be accessed from the Fat Pirate website using two separate UK internet connections.
The analysts said games loaded successfully through both a standard home broadband connection and a 5G mobile hotspot, without using a VPN.
“Holes have consistently been found in Evolution’s technical ring-fencing implementation,” the analysts said.
The timing of the report creates obvious questions around whether the UKGC knew about, considered or investigated the access identified by Rothschild before agreeing the £4.75m settlement.
Until the regulator publishes its decision, investors have only Evolution’s description of what was resolved.
Steady, but exposed: Deutsche Bank took a more positive post-earnings view, describing the settlement as better than expected given Evolution’s near-10% share-price fall when the investigation was originally announced.
But while Q2 trading provided some encouragement, they said the recovery remains incomplete. Live revenue fell 4%, Asia declined again and only 49% of total revenue came from players in regulated markets, according to the DB team.
They also noted no further update on the litigation relating to Black Cube and Playtech, with the process, according to management, expected to extend through 2026.
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+More
Evoke has formally recommended shareholders approve Bally’s Intralot’s £243m takeover following publication of the scheme document. The board said it unanimously considers the terms fair and reasonable. Investors will receive 0.537 new Intralot shares per Evoke share, or may elect for 52p in cash per share, subject to a £117.1m aggregate cap. Shareholder meetings are scheduled for August 17, with completion targeted for late 2026 or early 2027.
Deal talk
Social reverse: Tencent is in talks to acquire Playtika’s SuperPlay in a deal valuing the Israeli mobile gaming studio at $1bn-$1.5bn, according to Calcalist. Playtika bought SuperPlay for $690m in 2024, plus an earnout of up to $1.25bn. Stronger-than-expected growth has lifted the estimated liability to $829m. Tencent would reportedly assume those payments, easing pressure on Playtika’s balance sheet ahead of $2.3bn in debt maturities during 2028-29, while reversing its push beyond its traditional social casino business.
CIRSA is expanding in Portugal by acquiring a stake in Sociedade Figueira Praia, operator of the land-based Casino Figueira in Figueira da Foz. The transaction represents CIRSA’s second Portuguese acquisition following its 2024 purchase of online operator Casino Portugal. Terms were undisclosed and the deal will be funded in cash.
Compliance+More
Trump Media & Technology has pitched Wall Street firms a high-speed Truth Social data feed costing up to $100,000 a month. Truth API, due to launch August 1, would deliver posts from President Donald Trump and nine other influential accounts faster than ordinary notifications, potentially giving traders an edge on market-moving announcements. The proposal has prompted conflict-of-interest concerns.
Earnings
Kambi
On the turn: The sportsbook provider said its turnaround gathered momentum in Q2 as revenue rose 13.5% YoY to €45.9m, while adj. EBITDA increased 26% to €15.7m and its margin expanded to 34.2% from 30.7%.
Growth reflected strong trading, including the first half of the FIFA World Cup, new partner launches and a record 14% operator trading margin, while its efficiency program helped reduce operating expenses, despite credits for April operational issues.
CEO Werner Becher said the first half demonstrated Kambi had “turned a corner and returned to growth,” driven by product development, commercial progress and its transition to an AI-first organization.
Kambi raised its 2026 adj. EBITA (acq) outlook to €23m-€27m.
An Earnings Extra covering Kambi’s Q2 call will be sent to E+M PRO subscribers later today.
Hacksaw Gaming
Isn’t it organic: Q2 revenue rose 31% YoY to €59.3m, or 33% at constant currencies, driven by new game releases and continued customer growth. Adj. EBITDA increased 31% to €49.9m, with the margin unchanged at 84%.
The supplier released 17 in-house games and 17 through partner studios on its OpenRGS platform, while signing 106 deals, including 63 with new clients.
Hacksaw now supplies content in more than 40 locally licensed markets and secured approval in Alberta after the quarter.
The company intends to maintain organic expansion by investing in game development and selectively backing studios through Hacksaw Ventures.
“We are focusing on growing organically and making opportunistic investments in these ventures,” said interim CEO Ana Vrabic Verdir.
“Apart from that, we don’t see any transformative big M&A coming up [in the] near-term.”
Monarch Casino & Resort
Room to grow: Q2 revenue rose 4.2% to $142.6m, while adj. EBITDA increased 3.3% to $53m. Casino, food and beverage and hotel revenue all increased, with hotel revenue up 13% on additional Atlantis room availability and stronger convention business. Monarch ended Q2 still debt-free.
Puts+takes
Chomped: Bank of America has lowered its Q2 EBITDA forecasts for both DraftKings and Flutter’s FanDuel ahead of earnings, with the analysts now questioning whether there is a rising risk of prediction market cannibalization as the volumes have exploded.
BofA estimates that prediction market consumer volume on a comparable basis with OSB reached an estimated $10bn in June, equivalent to around 85% of US online sportsbook handle.
The team said 9.5% of DraftKings users also used Kalshi, up from 4% in January.
Low blow: For DraftKings, BofA cut its Q2 EBITDA estimate to $120m, well below the $173m consensus, while reducing its 2026 forecast from $700m to $625m, reflecting unfavorable sports outcomes and a belief that prediction investment will run above DraftKings $250m guidance.
BofA nevertheless expects DraftKings to maintain its full-year guidance, supported by better results and handle trends early in Q3.
It also expects strong growth from DraftKings Predictions, although rapid market-share gains could deepen the product’s near-term investment “J-curve.”
For FanDuel, BofA lowered its Q2 EBITDA estimate to $110m from $113m, but left its 2026 forecast broadly unchanged at $634m.
That remains substantially below the $970m midpoint of Flutter’s guidance.
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Venture playground
Funding news
Blaising saddles: Prediction markets startup Pascal has raised $9m in a Series A led by Union Square Ventures, taking its total funding to $15m. Previous backers include Wintermute Ventures and DBA.
Founded by former dYdX traders Ivo Crnkovic-Rubsamen and Matthew Downey, Pascal is targeting professional traders with exchange grade infrastructure rather than competing primarily for mainstream users.
Its Solana-based platform combines on-chain collateral with an off-chain matching engine, offering 50-millisecond order matching, maker rebates and APIs for algorithmic trading.
Pascal, which is named after 17th-century mathematician Blaise Pascal, said its private beta has already processed more than two million contracts without liquidity incentives or trading rewards.
U-Roy, which dub is this? Sports-betting creator marketplace DubClub has appointed former DraftKings product executive Ed Silva as CEO, following a funding round backed by existing investors Uncork Capital, Renegade Partners and Will Ventures.
Silva spent a decade at DraftKings, ultimately serving as vice-president of product, and most recently advised prediction market startups.
Co-founder Lewis Burik becomes president, overseeing revenue and monetization, while Andrew Daschbach remains head of creator success.
The new unspecified financing will support investment in DubClub’s consumer product, its team, and creator and fan community growth.
Hey dudes: Bettor Capital has revealed it was the seed and first institutional investor in Hey Seven, funding development of what the company calls gaming’s first AI-native premium-player development platform.
Now being deployed by land-based, online and omnichannel operators, the technology combines gaming, behavioral and conversational intelligence to identify VIPs earlier and deliver personalized, host-level engagement at scale.
Hey Seven said its autonomous AI operates within operator-defined guardrails, helping improve staff productivity, player loyalty and incremental revenue.
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Growth company news
Hog tied: BetHog will close its crypto casino and sportsbook on July 31, three months after raising $10m, as the company shifts its entire product and engineering operation to AI-dealer supplier Sentient Studios.
Customers have until the closure date to withdraw their funds, while all 16 product and engineering employees and the underlying technology will transfer to the B2B business.
CEO and co-founder Nigel Eccles insisted the closure was not driven by financial distress.
BetHog was generating monthly betting and casino handle in the “low tens of millions” and, with further investment, “would definitely be on the path to sustainability,” he told BettingStartups.
However, management concluded that the opportunity for Sentient was too large to pursue as a side project.
Sentient launched alongside April’s Series A round, which lifted BetHog’s total funding to $16m. Its technology is built around Sunny, the AI blackjack dealer introduced in late 2025.
Upcoming earnings
Jul 22: Las Vegas Sands
Jul 23: Boyd Gaming
Jul 28: Caesars Entertainment, BetMGM
Jul 29: MGM Resorts, Robinhood, VICI (e), Rush Street, Churchill Downs (e)
Octoplay has officially launched in Alberta on the first day of the province’s regulated iGaming market opening, going live simultaneously with BetMGM, FanDuel, DraftKings, Betty, Rush Street Interactive, PENN, and bet365. 🇨🇦
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