Evolution faces revenue risks following Brazilian gambling ban

The Brazilian government has issued a provisional decree banning sports betting and online casinos, effective immediately. Under the new regulations, operators are prohibited from accepting new deposits and must shut down their websites and applications by approximately October 5. Licenses are expected to be revoked around October 25.

This move is expected to impact the Swedish live casino provider Evolution. While Evolution has declined to comment on how the ban will affect the company or its future outlook, Pareto Securities has issued an analysis suggesting a negative impact on revenues.

According to Pareto, Latin America accounted for 8.6 percent of Evolution's revenue over the last twelve months, with Brazil being the largest market in the region. The bank estimates that the ban will cause a short-term revenue decline in the low to mid-single-digit percentage range as regulated operators in Brazil cease accepting deposits. However, the impact may lessen in the medium term if offshore operators utilizing Evolution's services absorb some of the lost market volume.