Playtech Shares Decline Amid Strong US Growth and LATAM Challenges

Playtech shares were trading down 2.55% at 343.50 pence (about $4.59) per share in London as of May 21, following a trend in the decline of the company’s shares that has been observed over the past months.

Playtech Shares See Prominent Shifts

Despite this, in a report earlier today, the gambling software developer said it saw strong revenue growth in the US across its live, casino, and platform segments. Growth was driven by 2024 launches with major operators such as Bet365, Rush Street Interactive, and Hard Rock Digital. The company also noted especially strong demand for its live dealer solutions in the US market.

However, Playtech also noted initial setbacks amid new regulations in Latin American markets. Countries like Brazil have been tightening regulations on the gambling sector, such as the government recently discussing stricter rules on gambling advertisement. Meanwhile, Colombia’s introduction of a temporary VAT charge has resulted in a 30% drop in the market’s online gross gaming revenue (GGR) since it was implemented in February.

What’s the Wider Trend for Playtech’s Shares?

As mentioned before, the past couple of months have been tumultuous for its shares, which saw rapid decline on several occasions. Just a couple of weeks ago, Playtech’s shares dropped 60% following a huge special dividend. This was caused by the company selling Snai, one of Italy’s top omni-channel operators, to Flutter Entertainment to the tune of $2.6 billion.

The deal shifted Playtech’s focus almost entirely to B2B operations. Following the sale, the company stated that adopting a more streamlined business model presents “significant further upside” and opens the door to expanded B2B growth opportunities.

Playtech Remains Positive

Despite the difficulties the company has faced over the past few months, chief executive officer Mor Weizer remains positive about the future outlook of Playtech. According to him, it has been a busy start to the year for Playtech as it transitions to a predominantly pure-play business-to-business model. With the sale of Snai to Flutter now completed, the company has significantly strengthened its balance sheet and plans to return approximately €1.8 billion (around $2.04 billion) to shareholders in the form of a special dividend.

Weizer further explained that Playtech’s core B2B business has shown strong performance in the first four months of the year, with particularly notable results in the US due to the strategic and operational progress being made across the company. Playtech remains confident in its ability to capitalize on exciting growth opportunities in the medium term.