Key Points
- Gentoo Media’s forecast for revenues by 2026 was lowered to €92 million, the second revision in five weeks owing to the temporary betting ban in Brazil and lower-than-expected performance in Q3.
- The €100 million financing framework comprising an agreed €50 million shareholders’ loan and a €50 million share sale to be approved in an Extraordinary General Meeting will be targeted at bonds that mature on 18 December 2026.
- Executives from the betting industry and Blask data show a growing trend for offshore betting in Brazil, although the volume of users switching to unregulated betting sites is unknown.
Guidance for 2026 was revised earlier by Gentoo Media in late August. Later, Brazil issued a decree on 25 September, prompting another revision by the company.
Presidential Decree Law, Provisional Measure 1,394 signed by Luiz Inácio Lula da Silva prohibited the conduct of operation, offer and advertising of fixed odds betting and online gaming. Licenses for such businesses will be compulsorily closed by 6 October, and the federal licenses will expire 30 days after publication on 25 October. Within six days of the issuing of the provision, Gentoo Media released its second guidance revision, which was accompanied by a €100 million refinancing plan for the December bond issue.
Two Pressures Behind One Guidance Cut
Its Nasdaq Stockholm-listed subsidiary is forecasting 2026 annual revenue of around €92m, lower than its previous forecast of €97m-€100m. EBITDA excluding one-time items is reduced to approximately €40m compared to €44m-€47m. Operating cash flow forecast is lowered to approximately €30m compared to €32m-€36m.
Gentoo cited two separate reasons for the reduction. As it no longer generates any revenue from Brazil in the remaining part of 2026 following its ban, it now forecasts no additional revenues from there. Moreover, lower-than-expected tracking results during Q3 were caused by lower player engagement and weak margins in the sports book during the second part of the quarter resulting in lower revenue share income.
In absolute terms, Brazil’s share of the story is contained. From January through August 2026, the country contributed approximately €3.8m in net revenue. Because Gentoo had been treating Brazil as a long-term investment market and spending on customer acquisition throughout the year, its EBITDA and cash contribution ran lower, proportionally, than its revenue share. Q4 growth had been planned as the return on that spending. It will not arrive.
€91.5m Bonds and What Covers Them
On the same day as the guidance revision, Gentoo disclosed a refinancing structure targeting bonds worth approximately €91.5m maturing on 18 December 2026. The arrangement combines two parts: a €50m senior secured term loan, agreed with the Juroszek family foundation, Fundacja Zbigniewa Juroszka Fundacja Rodzinna, a major shareholder, and a planned €50m share issue that the same family has agreed to fully underwrite if other shareholders do not take up their allocation. The share issue remains subject to further approvals, including shareholder vote at an Extraordinary General Meeting on 2 November 2026.
Combined secured commitments of approximately €100m exceed the bond amount, with surplus funds intended to reduce the company’s existing €16m debt facilities by roughly €8.5m. An independent refinancing committee approached more than 100 potential financing providers during 2026 before arriving at this structure.
CEO Jonas Warrer said: “This financing package puts a clear, fully committed solution in place ahead of our December bond maturity, backed by the continued support of our largest shareholders. It allows us to repay the bond in full, reduce our existing debt and take back control of our cash flow.”
This marks Gentoo’s second guidance cut since 26 August, when the company had already lowered its outlook and committed to a refinancing update by 1 October.
How the Rest of the Industry Is Reading Brazil?
Gentoo’s exposure sits at the smaller end of what the ban has cost listed companies so far. Better Collective had been tracking toward approximately €45m in Brazilian revenue for 2026, representing roughly 12% of analyst group revenue consensus. Its 2026 organic growth guidance dropped from 7% to 12% down to 3% to 8%, and the group suspended 2027 and 2028 targets entirely while halting share buybacks. As of 29 September, its share price had fallen more than 37% since the measure was announced.
Flutter warned of a potential $70m revenue reduction and $20m adjusted EBITDA impact if Brazil remained closed for the rest of 2026. Entain cut its online net gaming revenue growth forecast to 4% to 6%, now expecting results at the lower end of its £910m to £960m EBITDA range.
Genius Sports sat apart from all of them. Because of how its commercial agreements are structured, the company said Brazil’s financial impact would be immaterial. Genius Sports reaffirmed full-year revenue guidance of $1.005bn to $1.025bn unchanged. CEO Mark Locke said: “We have been sceptical about how long it would take to generate meaningful betting revenue in Brazil, and we have been fairly conservative in the way that we think about the market.”
What Industry Executives Are Warning About?
This proposal was justified on public health grounds by the government. In 2023, the Ministry of Health of Brazil stated that there were 10.9 million people in Brazil who have had risky or problematic gambling behaviour. In addition, the National Committee of Finance Secretaries blamed gambling for the shortfall of R$62.5bn in households’ budgets in 2025. It was also indicated that there is 62% support from Brazilians for regulating online gambling according to the Quaest poll held from 24 to 27 September.
What the licensed industry disputes is not the harm data but the instrument used to address it. Industry executives told NEXT.io that 25 million Brazilians held registered betting accounts and that demand does not dissolve when a licensed platform goes dark. Tiago Almeida, CEO of iGaming platform OddsGate, said: “Twenty-five million CPFs placed bets in 2025. That demand is Brazilian, it doesn’t ask the Planalto for permission, and it won’t disappear.”
Early market data gives the concern measurable shape, without proving its full scale. Blask monitoring showed offshore brands’ share of measured Brazilian iGaming demand rising from 3.4% on 24 September to 9.9% by 29 September, per NEXT.io analysis. That is a directional signal from the first days after publication, not a complete account of where displaced demand went.
Licensed platforms also carried responsible gambling obligations, dispute resolution mechanisms and transaction monitoring. Unlicensed platforms carry none of that. The National Association of Games and Lotteries (ANJL) and the Brazilian Institute for Responsible Gaming (IBJR) filed a legal challenge at Brazil’s Supreme Federal Court seeking suspension of the measure; the case was assigned to Justice Luiz Fux. By 2 October, football clubs had joined petitions to the same court, according to Reuters, after Serie A clubs received R$1bn in betting advertising revenue in 2025, up 67% year-on-year, per a Convocados and Outfield study.
What Congress Actually Decides Next?
The provisional decree will have legal binding from the date of its issuance but needs approval by Congress for permanence. The initial review period is until 23 November 2026, while there is also a provision for constitutional extension should the process be incomplete; congressional recess shall not be included within this period.
The 4 October presidential election adds uncertainty to the congressional trajectory, since the make-up of the legislative agenda will partly depend on the political outcome. Whatever Congress decides, the operational timetable is already set: licensed sites go dark from 6 October, and authorisations terminate on 25 October.
Gentoo’s revised guidance takes no position on the legislative result. It removes Brazilian revenue from 2026 entirely and treats the market as closed for the current year.
Expert Analysis
We think the question most coverage is not asking is what happens to the licensing investment if the provisional measure lapses rather than converts into permanent law. Operators paid R$30m each for five-year federal licences. The government has not confirmed refunds. Legal analysis in industry coverage suggests that licences extinguished on 25 October do not revive automatically if the measure lapses in 2027; a separate act from the Secretariat of Prizes and Betting would be required to restore them.
For Gentoo, the near-term financial perspective is covered. The Brazil number at €3.8m has already been taken out of the outlooks and the bonds have been refinanced with the exception of the EGM approval process. However, the difficult issue lies in whether the market that Gentoo once operated in mid-2026 will still be there when it tries to re-enter it. It might be an entirely different situation due to changes in the regulatory framework and cost structure. In our opinion, the industry assumption concerning the impossibility of passing this measure is probably correct from the standpoint of the odds involved. But the important thing is that it does not preclude anything from happening later on, because the expiring provisional measure does not equal the market being fully licensed.
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