Lottomatica has emerged from Q1 with modest but meaningful growth across its core metrics, buoyed by robust online expansion that has largely neutralised a disappointing performance in sports betting. The Italian gaming heavyweight reported a 2% rise in gross gaming revenue to €1.25 billion alongside a 3% uplift in total revenue to €602 million. Adjusted EBITDA performed strongest at 7% growth to €236 million.

Online Drives Resilience

The standout performer was undoubtedly the online segment, which delivered double-digit revenue growth of 10% to €264.7 million. This proved decisive in offsetting flatness in the gaming division and a more troubling 5% contraction in sports betting revenue, which fell to €142.4 million from €150.4 million year-on-year.

The sports betting decline tells a cautionary story about unfavourable hold dynamics. Despite total betting volume climbing 11% to €12.4 billion, Lottomatica faced a headwind of adverse sports payouts compared to the same quarter in 2025. Volume growth alone doesn’t guarantee revenue expansion when hold works against you. It’s a useful reminder of what actually matters in this space.

What should encourage investors is Lottomatica’s market positioning. The company expanded its share of the Italian online market to 31.8%, up 1.4 percentage points year-on-year, whilst maintaining dominant positions in both iSports (32.5%, up 0.7 points) and iGaming (32.2%, up 1.9 points). These gains underline its ability to capture market share even as the overall Italian market matures.

Portfolio Recovery in Progress

PlanetWin365 deserves particular attention here. The SKS365 acquisition was rebranded and integrated onto Lottomatica’s proprietary platform in 2024, and the recovery trajectory has been impressive. The brand’s sports market share has climbed back to 9%, matching pre-migration levels, whilst iGaming share recovered half of the losses incurred during the migration to 5.5%. Platform migrations are notoriously disruptive. To see this kind of recovery within a year speaks volumes about both the underlying quality of the brand and the execution of the transition itself.

Management’s outlook remains confident. Chairman and CEO Guglielmo Angelozzi indicated the company expects to hit the upper end of its FY2026 adjusted EBITDA guidance range of €940 million to €980 million. On top of that, the company is planning to return up to €1 billion to shareholders across 2026 and 2027. That combination of growth guidance and capital returns suggests board-level conviction in the business trajectory.

Prediction Markets: A Non-Event in Italy

During the earnings call, Angelozzi offered a characteristically bullish assessment of prediction markets, which have faced regulatory headwinds across Europe. France, Germany, Belgium, and Italy have all moved to restrict them, and the sector faces considerable friction. Lottomatica’s stance is pragmatic. Prediction markets are illegal in Italy, and more fundamentally, there’s simply no consumer demand for the single and pre-match betting formats on which they depend. It’s a product-market mismatch, frankly, and Lottomatica appears content to let international competitors chase that particular dragon.

For a company of Lottomatica’s scale and market dominance, Q1 represents solid footing from which to navigate 2024. Online strength, improving portfolio dynamics, and disciplined market share gains paint a picture of a business executing its strategic priorities effectively.