2025, Bet365, a major player in the online gambling industry based in the UK, reported a group loss of £43 million. This outcome stems from the company’s strategic shift towards regulated markets, a move significant for regulatory compliance and long-term business sustainability. The pivot involved exiting several historically grey markets, including China, aiming to align operations with majority-regulated jurisdictions.
The company noted a 9% increase in its sports and gaming revenue, reaching £4.036 billion. This growth was primarily driven by a 25% rise in gaming revenue, facilitated by enhancements to Bet365’s product suite, which included a transition to a central casino vertical accessible across all platforms. Enhancements also included improvements to its in-house games recommendation engine, which expanded into more markets during the year. Despite these gains, the sports operating segment recorded a modest 5% growth, partly attributed to successful market entries and events like the UEFA Euro 2024 tournament.
However, the financial bottom line deteriorated, with sports and gaming operating profit falling by 43% to £227.6 million and profit before tax dropping by 44% to £348.7 million. This decline was largely due to increased costs linked to market expansion efforts and a one-off restructuring expense of £59.2 million. Total administrative costs rose to £324.7 million.
Part of the financial loss was also attributed to the reduction of fixed assets by £98.5 million following the divestment of its stake in Stoke City Holdings Limited. In contrast, the company reported a return to profitability in the sports and gaming segment at £626.6 million the previous year, following extensive operational improvements.
The strategic exit from non-regulated markets, including the costly withdrawal from China, incurred a loss of £10.2 million. CEO Denise Coates stated that the decision to pivot away from these markets was made because they no longer fit the criterion for long-term sustainable revenue. Consequently, Bet365 focused on obtaining licenses in regulated markets, with new licenses secured in countries such as Brazil, Peru, Serbia, and several US states.
The company’s decision to concentrate on regulated markets aligns with its strategy to prioritize jurisdictions offering robust regulation for sustainable revenue streams. Coates emphasized the importance of acquiring and maintaining gambling licenses where feasible, directing resources towards markets with promising long-term potential.
During the year, Bet365’s tax contributions in the UK increased by 32%, totaling £481.5 million. Meanwhile, the company is under investigation by AUSTRAC, Australia’s financial intelligence agency, for potential violations of anti-money laundering and counter-terrorism financing laws. Bet365 commissioned an external audit by Kord Mentha, whose recommendations have been implemented, and the findings are currently under review by AUSTRAC. Bet365 stated that it is too early to predict the outcome or timeline of the investigation.
Looking forward, Bet365 is positioned to continue its focus on securing licenses in commercially viable, regulated markets. The outcome of the AUSTRAC investigation remains pending, and its results could significantly influence the company’s operations in Australia. Meanwhile, Bet365 anticipates that its strategic realignment towards regulated markets will eventually stabilize and enhance its revenue streams.
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