Allwyn has warned that its previous 2026 Adjusted EBITDA margin guidance will no longer apply if Brazil’s prohibition on online sports betting and iGaming remains in force for the rest of the year.
The Switzerland-headquartered lottery and gaming group owns 36.75 per cent of Kaizen Gaming, operator of the Betano brand. Brazil is Betano’s largest individual market.
Allwyn expects the effect on its overall financial position to remain limited because Betano represents a relatively small contribution to its consolidated results. However, an extended prohibition would invalidate its previous guidance of an approximately 37 per cent Adjusted EBITDA margin for 2026.
Brazil prohibition places authorised Betano operation under pressure
Brazil introduced the restriction on 25 September through Provisional Measure No. 1,394. It prohibits fixed-odds betting nationwide, including sports betting and online casino games, together with the promotion and facilitation of those services.
The measure took effect immediately, representing a significant change for a regulated market that formally launched on 1 January 2025.
Before the restriction, the Ministry of Finance continued to list Kaizen Gaming Brasil as an authorised operator. Betano operated through betano.bet.br under a five-year licence issued through SPA/MF Ordinance No. 246 of 7 February 2025.
Betano is assessing ways to reduce the effect of the prohibition and preparing legal action to protect its rights. The status of licences issued before the measure is now an important part of the regulatory dispute.
International markets provide some protection from Brazil disruption
Allwyn’s stake in Kaizen is accounted for at equity. Any effect from Betano’s Brazilian operations would therefore appear mainly through Allwyn’s share of profit from equity-method investments rather than as a direct fall in consolidated revenue.
The scale of the impact will depend on how quickly Betano can reduce costs that are not normally variable in the short term and whether other measures can offset lost revenue.
Duration will also matter. Allwyn said the consequences for later reporting periods will depend on how long the prohibition remains and what further cost and revenue measures Kaizen introduces.
Brazil is Betano’s largest market but does not provide most of its revenue. Its other international markets collectively generate more and have recently recorded significantly faster growth. The operator still plans to enter four additional countries in early 2027.
Allwyn’s indirect exposure limits the immediate financial damage, but withdrawing its margin guidance shows that Brazil is important beyond its accounting treatment. The decisive issues are how long the prohibition lasts, whether Betano can defend its existing licence and how quickly Kaizen can reduce costs.
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