FDJ United revenue falls 8.1% in third quarter as group cuts outlook
Key Facts
FDJ United cut its financial outlook for 2026 after third-quarter revenue fell 8.1% year on year to 794 million euros, according to its disclosure published on October 21. The group now targets a mid-single-digit decline in annual revenue, reflecting mounting pressure on its gaming and betting businesses. Revenue for the first nine months totalled 2,576 million euros, down 5.6% from the same period a year earlier. Quarterly performance was weaker than in the first half, when revenue reached 1,782 million euros, down 4.5%. The decline thus accelerated in the third quarter after the group ended the first half with a less pronounced fall.
The latest revision marks a further departure from the outlook the group announced with its previous annual results, when it targeted slight revenue growth in 2026. That original guidance also included a stable recurring earnings before interest, taxes, depreciation and amortisation margin of 24.5%. The group then cut its outlook with its first-half results, targeting a low-single-digit decline in annual revenue. At that time, it set a recurring EBITDA margin range of 23% to 24%, according to its first-half results statement. It now targets a full-year margin of around 23%, at the bottom of the range announced in July.
Gaming tax increases weighed on group revenue by 62 million euros in the first nine months, according to the company's disclosure. Over the same period, gross gaming revenue before public levies totalled 6,264 million euros. That total fell 2.8% year on year, a smaller decline than the drop in group revenue after levies. Chief Financial Officer Dan Levy said during the earnings call, according to the transcript published on Investing, that "gross gaming revenue is the appropriate indicator for understanding underlying business trends." His clarification addressed the impact of taxes on reported revenue, alongside the pressures facing the gaming business itself.
Gaming activities delivered mixed results over the nine months, with gross gaming revenue from instant games rising 1.9%, while gross gaming revenue from draw games fell 10.3%. The group had said with its first-half results that fewer and smaller jackpots, particularly in EuroMillions, were weighing on its lottery business. In its latest disclosure, it added that higher sports bettor winnings were among the reasons for weaker third-quarter performance. Revenue at the online betting and gaming unit totalled 619 million euros in the first nine months. Excluding the Netherlands and the United Kingdom, the unit's gross gaming revenue rose 5.7% over the same period. The unit's revenue excluding those two markets increased 0.8%, according to the comparison published by the group.
The group generated recurring EBITDA of 404 million euros in the first half. Its recurring EBITDA margin was 22.7%, according to the results statement for that period. Implementation of its performance improvement plan helped reduce the group's fixed costs by 2.8% during the first half. As it cut its annual financial outlook, the company reaffirmed its goal of increasing annual dividends to shareholders. It maintained its commitment to distribute at least 75% of adjusted net profit, retaining its dividend target while revising its revenue and profitability outlook.
The group is reviewing the markets in which its online betting and gaming business operates. The review also covers its non-core assets, particularly in payments and services, according to its disclosure. It intends to announce the results of the review by early 2027 at the latest. For the full financial year, management expects the impact of additional gaming taxes to exceed 70 million euros, according to coverage of the earnings call published on Investing. The group is scheduled to publish its annual results on Thursday, February 18, 2027, before the market opens.