Inspired Entertainment Q2 revenue falls 24% yr/yr after divestitures

Inspired Entertainment

05/08/2026 21:34

Overview
B2B gaming technology firm's Q2 revenue rose 6% sequentially, but fell 24% yr/yr after divestitures
Adjusted EBITDA for Q2 climbed 14% sequentially to $27.1 mln, with a record 45% margin
Company repaid $10 mln in debt and repurchased $2.6 mln in stock during the quarter

Outlook
Inspired Entertainment reaffirms 2026 Adjusted EBITDA target range of $112 mln to $118 mln
Company updates 2026 Free Cash Flow conversion outlook to 20%+, from prior 20%-25%
Inspired expects sequential Adjusted EBITDA growth through 2026, with less seasonality post-divestiture

Result Drivers
RETAIL SOLUTIONS GROWTH - Co said North American retail sales and continued strength in the UK drove strong performance in Retail Solutions
INTERACTIVE SEGMENT GAINS - Revenue and Adjusted EBITDA in Interactive increased 15% and 13% yr/yr, reflecting continued market share gains despite higher UK remote gaming duty
PORTFOLIO OPTIMIZATION - Divestiture of UK holiday parks and restructuring of pubs business reduced revenue but improved earnings quality and margins

Company press release: ID:nGNX3z8jX2

Key Details
Metric
Beat/Miss
Actual
Consensus Estimate
Q2 Revenue
 
$60.80 mln
 
Q2 Net Income
 
$200,000
 
Q2 Adjusted EBITDA
 
$27.10 mln
 
Q2 Adjusted EBITDA Margin
 
45.00%
 
Q2 Operating Income
 
$9.90 mln
 

Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the online services peer group is "buy"
Wall Street's median 12-month price target for Inspired Entertainment, Inc is $13.00, about 89.2% above its August 4 closing price of $6.87
The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 13 three months ago

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)