Europe ringfencing hits hard as Evolution CEO laments ‘unbalanced’ regulation in 2025
Article Date: 2026-02-05T12:24:00+00:00
Author: Nicole Macedo
Summary
Evolution Group AB reported a largely flat full-year 2025 revenue of €2.07bn, but its European business suffered materially in Q4 as ringfencing and stricter channelisation measures cut market access. CEO Martin Carlesund described Europe’s regulatory environment as “unbalanced” and said the company’s geolocation-based exit from unregulated European markets weighed on results.
Despite Europe weakness, Evolution saw signs of recovery in Asia as efforts to counter cyberattacks started to pay off, and the CEO highlighted North and Latin America as more stable growth markets. The planned acquisition of Galaxy Gaming is “progressing” but has been delayed by Nevada regulator requirements.
Key Points
- Q4 2025 Europe revenues fell 8% year-on-year to €366.7m, driven by lower channelisation and ringfencing moves.
- Full-year group revenue was essentially flat at €2.07bn (0.2% increase vs 2024); live games made up 86% of revenue.
- Operating expenses rose 8.34% to €860.9m, mainly from personnel and new studio/table launches; operating profit dropped to €1.26bn (margin 59.4%).
- Evolution implemented geolocation blocking in Europe in 2025 to exit unregulated markets, a move that proved costlier than expected.
- CEO Martin Carlesund called Europe regulation “unbalanced”, saying channelisation in some countries fell to around 50%, limiting Evolution’s accessible market share.
- Asia returned to growth in Q4 as measures to counter persistent cyberattacks reduced product theft, though the company remains unsure when attacks will cease.
- North America and LATAM are positioned as more stable markets and areas of strategic focus.
- The Galaxy Gaming acquisition faces regulatory delays in Nevada but is not expected to materially change Evolution’s business model.
Content summary
On the FY25 earnings call Martin Carlesund expressed frustration at Europe’s regulatory environment and the immediate financial impact of ringfencing. The group’s overall top-line was steady, but margins and operating profit softened due to rising costs and regional headwinds. Evolution is balancing short-term European pain with expansion and stability efforts in the Americas and recovery in Asia as it combats cybercrime.
Context and relevance
This story sits at the intersection of regulation, compliance and supplier strategy in iGaming. Ringfencing and stricter channelisation are reshaping supplier access to European players, forcing big vendors like Evolution to retrench or increase spend on compliance and geolocation technologies. For operators, regulators and investors, the piece signals where market access is tightening and why suppliers are pivoting to the Americas and doubling down on security in Asia.
Why should I read this?
Quick and to the point: if you work in iGaming, finance or regulation, this explains why a sector heavyweight’s European revenue took a hit and where the company is looking for calmer waters. Saves you the call — read this to know how ringfencing, cybercrime and regulatory grind are reshaping supplier strategy.