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Flutter Entertainment plc (FLUT)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 results were mixed on the headline: “Primary EPS” (per S&P, aligns with company Adjusted EPS) beat consensus by ~$0.84 (2.95 vs 2.11*) on stronger US profitability, while revenue was roughly in line/slightly below ($4.19B vs $4.22B*) . Values retrieved from S&P Global.
  • Flutter raised FY25 guidance midpoints to $17.26B revenue (+$0.18B) and $3.295B Adj. EBITDA (+$0.115B), with upgrades concentrated in the US, and International unchanged; interest expense midpoint rose to $535M on Boyd financing .
  • US iGaming outperformance (+42% YoY revenue) and record June sportsbook gross revenue margin month underpinned a 530 bps YoY US EBITDA margin expansion (22.3%); group Adj. EBITDA grew 25% YoY to $919M (21.9% margin) .
  • GAAP net income fell 88% YoY to $37M, with EPS down to $0.59, driven by non‑cash Fox Option revaluation, higher amortization of intangibles from Snai/NSX, and higher tax expense; adjusted EPS rose to $2.95 on EBITDA strength .
  • Near‑term catalysts: upgraded FY guide, 100% FanDuel ownership and ~$65M annual market access savings from Boyd, mitigation actions (Illinois transaction fee), continued buyback program (target ~$1B in 2025) .

What Went Well and What Went Wrong

What Went Well

  • US profitability inflected: US Adj. EBITDA rose to $400M (+54% YoY) with margin +530 bps to 22.3% on operating leverage and product‑led margin expansion .
  • Record product engagement and margin: “June … highest gross revenue margin month on record of 16.3%,” with structural sportsbook margin up 70 bps to 13.6% on SGP penetration and live betting; iGaming revenue +42% YoY with AMPs +32% .
  • Execution on strategy/M&A: closed Snai and NSX, leadership in Italy (30.2% online share), Brazil scale position; large migrations (Sky Bet >9M customers; PokerStars Italy) to shared platforms; management reiterates $300M cost program confidence .

Quotes

  • CEO: “Revenue grew by 16% year‑on‑year… Since Q1, Flutter … accelerated ownership of FanDuel to 100% … became the largest operator in Italy with Snai … and established a scale position in Brazil through NSX.”
  • CEO on product: “Fanduel’s same game parlay experience … underpinned a further … margin expansion … We also expanded SGP live to tennis … delivering a record Wimbledon.”
  • CFO: “We are upgrading our full year adjusted EBITDA guidance … to $3,295,000,000 … US revenue $7,580,000,000 and $1,245,000,000 adjusted EBITDA.”

What Went Wrong

  • GAAP compression: Net income down 88% YoY to $37M; EPS to $0.59, reflecting Fox Option fair value charge ($81M vs $91M gain prior year), higher amortization (+$62M YoY), and higher taxes (+$115M YoY) .
  • Cost pressure pockets: Unallocated corporate overhead +60% YoY to $72M (FX revaluation, inflation, Flutter Edge investments); International cost of sales +320 bps (mix shift to iGaming, Snai/NSX, Brazil taxes) .
  • Regulatory headwinds: Illinois wager fee increased operating costs; Flutter to implement $0.50 per‑bet fee from Sep 1 to mitigate; guidance assumes partial state tax headwind offset by Boyd savings .

Financial Results

Headline metrics vs prior periods and S&P Global estimates

MetricQ2 2024Q1 2025Q2 2025 ActualQ2 2025 S&P Estimate*
Revenue ($USD Millions)3,611 3,665 4,187 4,216.1*
GAAP Diluted EPS ($)1.45 1.57 0.59 N/A
Primary EPS (S&P; aligns to Adj. EPS here) ($)2.04 1.59 2.95 2.1139*
Adjusted EBITDA ($USD Millions)738 616 919 N/A
Adjusted EBITDA Margin (%)20.4% 16.8% 21.9% N/A

*Values retrieved from S&P Global.

Notes: S&P “Primary EPS” tracks company “Adjusted EPS” in recent periods (Q1 actual 1.59; Q2 actual 2.95) .

Segment performance

SegmentQ1 2025 Revenue ($M)Q2 2025 Revenue ($M)Q2 2024 Revenue ($M)Q2 2025 Adj. EBITDA ($M)Q2 2024 Adj. EBITDA ($M)
US1,666 1,791 1,527 400 260
International1,999 2,396 2,084 591 523
Unallocated CorporateN/AN/AN/A(72) (45)
Group Total3,665 4,187 3,611 919 738

Revenue mix and KPIs

KPIQ2 2024Q2 2025
Group AMPs (000s)14,344 15,978
Group Handle ($M)18,398 19,669
Group Net Revenue Margin (%)11.4% 11.5%
Sportsbook Revenue ($M)2,096 2,260
iGaming Revenue ($M)1,354 1,775
US Net Revenue Margin (%)10.0% 10.4%
US iGaming Revenue ($M)357 507

US market share snapshot (Q2): sportsbook GGR 41%, NGR 44%, iGaming GGR 27% .

Guidance Changes

MetricPeriodPrevious Midpoint (May 7)Current Midpoint (Aug 7)Change
Group RevenueFY25$17.08B $17.26B Raised +$0.18B
Group Adjusted EBITDAFY25$3.18B $3.295B Raised +$0.115B
US Total RevenueFY25$7.40B $7.58B Raised +$0.18B
US Total Adj. EBITDAFY25$1.13B $1.245B Raised +$0.115B
US Existing States RevenueFY25$7.44B $7.61B Raised +$0.17B
US Existing States Adj. EBITDAFY25$1.22B $1.315B Raised +$0.095B
US New States RevenueFY25-$40M -$30M Improved +$10M
US New States Adj. EBITDAFY25-$90M -$70M Improved +$20M
International RevenueFY25$9.68B $9.68B Maintained
International Adj. EBITDAFY25$2.30B $2.30B Maintained
Unallocated Corporate OverheadFY25-$250M -$250M Maintained
Interest Expense (net)FY25$480–500M (range) $535M (mid) Raised

Drivers of upgrade: favorable US sports results in May/June (+$100M EBITDA), Boyd market access savings (+$35M), tax changes in IL/NJ/LA (net -$40M) largely offset, and timing of new state launches .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4’24 and Q1’25)Current Period (Q2’25)Trend
Product/SGP & LiveStructural margin reached 14.5% in Q4; Your Way rolled out; continued innovation . Q1 SGP penetration +260 bps; “Your Way” early results encouraging .Record June margin month (16.3% GGR); SGP+ and live expansion incl. tennis; MLB “Batter Up” and Quick Bets .Improving
US iGaming focusQ4 iGaming +43% YoY; direct casino strategy . Q1 iGaming AMPs hit 1M; jackpots/rewards rolled out .iGaming revenue +42% YoY; AMPs +32%; Rewards Club scaled; exclusive content .Improving
Regulatory/taxIL tax in 2024 impacted COGS; advocacy for balanced tax .IL wager fee; $0.50 transaction fee mitigation; expect balanced approach; Boyd savings offset .Mixed but mitigated
M&A / Market AccessSnai/NSX announced; guide excludes until Q2 closing . Q1 closed Snai, NSX near .Snai/NSX closed; 100% FanDuel; Boyd access to 2038, ~$65M annual savings .Positive
Cost transformationInvestor Day $300M target; ongoing . Q1 progress; Sky Bet/PokerStars migrations .Sky Bet >9M users migrated; PokerStars Italy migrated; reiterated $300M by 2027 .On track
Brazil strategyTransitory re‑registration friction in Q1 .Combined NSX+Betfair; “elevate proposition” targeting unit economics and product roadmaps .Building
Prediction/Event marketsMonitoring; exchange expertise (Betfair) .Evaluating opportunities; stakeholder considerations .Monitoring

Management Commentary

  • Strategy/M&A: “We … accelerated ownership of FanDuel to 100% … became the largest operator in Italy with the addition of Snai; established a scale position in Brazil through NSX; and successfully executed two transformative customer migrations.” — Peter Jackson, CEO .
  • US product/hold: “Same Game Parlay+ and profit boost … have been really pleased with engagement … [and] expanded … live to tennis … record Wimbledon for FanDuel.” — CEO .
  • Cost and leverage: “We expect leverage to increase in the near term [Boyd financing] but then reduce rapidly … We remain committed to our medium term leverage ratio target of 2.0–2.5x.” — CFO .
  • Guidance framing: “We are upgrading our full year adjusted EBITDA guidance … to $3,295,000,000 … US … $7,580,000,000 revenue and $1,245,000,000 adjusted EBITDA.” — CFO .

Q&A Highlights

  • US marketing leverage and phasing: Sales & marketing as % of revenue down ~440 bps YoY; ~$20–25M marketing shifted into H2 for NFL/NBA seasonality .
  • Illinois mitigation: $0.50 transaction fee introduced; guidance does not assume the fee is taxable; will adjust if state treatment changes .
  • Market access economics: Boyd renegotiation sets a lower benchmark; broader renegotiation opportunities exist but largely from 2030 onward .
  • New state cost template: ~$35M contribution loss per 1% population; Missouri (~1.8%) implies ~$70M EBITDA loss—consistent with guide .
  • Cost of sales levers: Payment processing initiatives, fraud reduction, focus on geolocation and other large cost buckets; non‑tax COGS scaling opportunities continue .

Estimates Context

  • Q2 2025: Revenue $4.187B vs $4.217B* (slight miss), “Primary EPS” 2.95 vs 2.11* (beat); Q1 2025: Revenue $3.665B vs $3.700B* (slight miss), “Primary EPS” 1.59 vs 1.89* (miss) . Values retrieved from S&P Global.
  • Street models likely need: higher US EBIT/EBITDA flow‑through (marketing leverage, SGP/live margin), slightly higher interest expense, and incorporate Boyd savings offsetting state tax headwinds .

Estimates detail

MetricQ1 2025 ActualQ1 2025 S&P*Q2 2025 ActualQ2 2025 S&P*
Revenue ($M)3,665 3,700.0*4,187 4,216.1*
Primary EPS ($)1.59 1.8865*2.95 2.1139*

*Values retrieved from S&P Global.

Key Takeaways for Investors

  • The quality of earnings improved: strong US operating leverage and product‑led margin expansion drove a material EPS beat despite modest revenue variance vs consensus .
  • FY25 outlook raised with upgrades centered in US; International steady. Importantly, management explicitly quantified sports result tailwinds and offsetting tax dynamics, plus Boyd savings that largely neutralize incremental 2H tax headwinds .
  • US iGaming leadership is a durable differentiator (AMPs +32%, revenue +42%), with jackpots, exclusive content and Rewards Club scaling—this should support mix, margins, and LTVs into NFL season .
  • Regulatory risk is being actively mitigated (IL transaction fee; marketing/promotional optimization; market access repricing), reducing downside to state‑level tax changes .
  • Balance sheet/capital returns: available cash $1.7B, net leverage 3.0x incl. Snai; continued buybacks ($1B in 2025; new $245M tranche announced for Q4) provide downside support while M&A/investment remains flexible .
  • Watch list: US sports outcomes normalizing into NFL; Missouri launch phasing costs; Brazil execution (product roadmap, unit economics) and Italy migration benefits through 2026 .
  • Near‑term stock drivers: sustained US margin/EBITDA momentum in Q3–Q4, evidence of IL fee mitigation holding, and further proof points on iGaming share and customer monetization .