Flutter Entertainment has credited strong performances from its operations in India, Southern Europe and Africa, as well as its scaling US business, for a year-over-year uptick in net income and adjusted EBITDA in the first quarter of 2025.
Taking into account the completion of the Snai acquisition and the anticipated completion of the NSX acquisition, the operator has also updated its guidance for the year, increasing revenue and adjusted EBITDA by $1.07bn and $120m, respectively.
CEO Peter Jackson added that Flutter is “uniquely positioned to win” in the global regulated gambling market.
Net income and adjusted EBITDA growth
Publishing its Q1 financials, Flutter reported an 8% YoY increase in revenue to $3.67bn (Q1 2024: $3.4bn), with average monthly players growing by 8% as well to 14.9 million (2024: 13.7 million).
Net income increased by 289% YoY to $335m (2024: $177m loss) following “non-cash impacts of a gain in the fair value of the Fox Option liability of $205m (2024: $184m loss) and a charge relating to the amortisation of acquired intangibles of $158m (2024: $172m)”.
Meanwhile, adjusted EBITDA rose by 20% to $616m (2024: $514m), while its margin rose to 16.8% (2024: 15.1%). As previously mentioned, operations in India, Southern Europe and Africa, as well as the US, were a driving factor behind net income and adjusted EBITDA increasing.
Jackson said during Flutter’s Q1 earnings call: “I continue to be really pleased with how the scaling of our US business is driving a step change in the earnings profile of the group.
“Our international business is also demonstrating the benefits of scale and diversification, with particularly strong performances in SEA (Southern Europe and Africa) and India. These factors combined to drive year-over-year net income and adjusted EBITDA growth of 289% and 20%, respectively, in Q1.”
Flutter’s net cash provided by operating activities dropped by 44% YoY in Q1 to $188m (2024: $337m), while free cash flow declined by 52% to $88m (2024: $185m).
Flutter cited that the declines were due to a player deposit liabilities swing, after the last day of Q1 was a weekday compared to it taking place during the weekend in the previous year, “when customers typically hold a greater amount of funds in their wallets”, offsetting the adjusted EBITDA expansion.
India, Southern Europe and Africa operations perform
Per segment, Flutter’s international revenue in Q1 grew by 1% YoY to $2bn (2024: $1.99bn), while its adjusted EBITDA fell by 1% to $518m (2024: $524m) with a margin of 25.9%. The segment’s iGaming revenue rose by 4% to $1.05bn, sportsbook revenue declined by 2% to $880m, while other revenue dropped by 15% to $69m. Average monthly players grew by 8% to 10.6 million.
The operator stated that the international growth was caused by increases in Southern Europe and Africa, Central and Eastern Europe, as well as iGaming in the UK and Ireland, being offset by sportsbook in Asia Pacific.
Per region, UK&I revenue rose by 2% YoY to $882m (2024: $861m), Southern Europe and Africa revenue grew by 14% to $448m (2024: $394m) with sportsbook, iGaming, Italy and Turkey revenue increasing by 27%, 8%, 9% and 57% respectively.
Meanwhile, Asia Pacific revenue dropped by 13% YoY to $313m (2024: $358m), but included iGaming growth in India of 45% that was offset by an 18% drop in Australian sportsbook revenue.
Central and Eastern Europe revenue rose by 15% to $140m (2024: $122m) following strong performances in Georgia and Serbia, but Brazil revenue declined by 44% to $9m (2024: $16m), due to the “transitory impact of customer re-registration friction in the newly regulated market”.
Other regions’ revenue decreased by 12% to $207m (2024: $236m) due to market departures and changes in regulation.
US growth despite customer-friendly March Madness
In the US, Flutter’s revenue in Q1 rose by 18% YoY to $1.67bn (2024: $1.4bn), while its adjusted EBITDA increased by 519% to $161m (2024: $26m) with a margin of 9.7%.
The operator noted that sportsbook revenue increased by 15% YoY to $1.13bn during the quarter despite customer-friendly March Madness results, while iGaming revenue grew by 32% to $472m and other revenue fell by 9% to $60m. Average monthly players rose by 11% to 4.3 million.
Jackson commented: “FanDuel continues to win in the US, retaining leadership positions in both online sports betting and iGaming, while we saw a positive performance within International, where our scale and the competitive advantages of our Flutter Edge have been enhanced by the acquisition of Snai in Italy.”
Updated 2025 guidance
As a result of the impact since its Q4 earnings of US sports results and foreign currency movements, as well as the anticipated contributions from Snai and NSX, Flutter has updated its 2025 guidance.
The Snai acquisition and the anticipated May completion of the NSX acquisition are expected to increase the operator’s group revenue and adjusted EBITDA by $1.07bn and $120m, respectively.
Group revenue is now expected to be $17.08bn at the midpoint, a 22% YoY increase, while adjusted EBITDA is expected to be $3.18bn at the midpoint, a 35% increase. Before including the Snai and NSX acquisitions, revenue growth would be 14%, while adjusted EBITDA growth would be 30%.
US revenue and adjusted EBITDA midpoints are expected to be $7.4bn and $1.13bn, respectively, while international revenue and adjusted EBITDA midpoints are expected to be $9.68bn and $2.3bn, respectively.
Jackson concluded: “We are delivering against our strategic priorities, with clear optionality as an ‘and’ business that can create significant value through a combination of organic growth, accretive M&A, and returns to shareholders. The global regulated market opportunity is significant, and Flutter remains uniquely positioned to win.”
