Evolution's Q2 Revenue Dips Again as Galaxy Gaming Deal Hangs in the Balance

Dr. Annelies De Vos · 2026-07-17

Evolution, the leading live casino supplier, has reported a second straight quarter of declining revenue for 2026. The company posted net revenue of $560.5 million (converted from €517.8 million) for Q2, a 1.2% drop year-over-year from $567.6 million (converted from €524.3 million). While revenue slipped, EBITDA hit $369.2 million (converted from €341.0 million), keeping a healthy 65.9% margin. Net profit ticked up slightly to $272.2 million (converted from €251.4 million), and earnings per share rose to $1.37 (converted from €1.27). CEO Martin Carlesund highlighted improvements over Q1, pointing to better cost control, stronger cash flow, and growth in key markets. “Revenue and margin trends are stabilizing,” Carlesund said in a statement. For a company that's been a powerhouse in live dealer gaming, these numbers show a mixed picture—one that leaves investors and industry watchers wondering what's next. ### What's Behind the Revenue Dip? The revenue decline isn't a massive red flag, but it does raise questions. Evolution's core business—live casino games streamed from studios worldwide—still dominates. Yet, competition is heating up. New entrants in the live dealer space and shifting player preferences may be chipping away at Evolution's market share. Additionally, regulatory changes in some European markets have slowed growth. The company's reliance on a few big clients also makes it vulnerable to shifts in their strategies. Carlesund's optimism about cost control and cash flow is worth noting. Evolution has been trimming operational fat, which helped maintain that impressive EBITDA margin. But the real story here might be the Galaxy Gaming acquisition. ### The Galaxy Gaming Acquisition: Still Uncertain Evolution's planned acquisition of Galaxy Gaming has been a hot topic for months. Galaxy brings a strong portfolio of table game side bets and proprietary games, which could complement Evolution's live dealer offerings. But the deal remains in limbo. Regulatory approvals are taking longer than expected, and some shareholders have raised concerns about the price tag. * The acquisition was initially announced in early 2026. * It's valued at around $85 million (converted from €78.5 million). * Galaxy's products are popular in land-based casinos, but their online potential is untested. If the deal closes, Evolution could tap into new revenue streams. If it falls through, the company might need to pivot quickly. For now, investors are watching closely. ### Market Growth in the Americas One bright spot is Evolution's performance in the Americas. The U.S. market, in particular, is booming. States like Michigan, Pennsylvania, and New Jersey continue to see strong online casino growth. Evolution's live dealer games are a hit with American players who crave an authentic casino experience from home. > "We're seeing real momentum in North America," Carlesund said. "Our partnerships with operators there are deepening, and player engagement is up." This regional strength helps offset some of the softness in Europe. As more U.S. states legalize online gambling, Evolution is well-positioned to ride that wave. The company's investment in new studio space in New Jersey and plans for a Canadian studio show it's betting big on the region. ### What This Means for the Industry Evolution's mixed results offer a snapshot of the broader online gambling landscape. Growth isn't as explosive as it was during the pandemic boom. Now, companies need to focus on efficiency and innovation. Evolution's high margins suggest it's doing that, but the revenue decline is a reminder that no one is immune to market shifts. For competitors, this could be an opportunity. If Evolution stumbles, other live casino providers might grab market share. But for now, Evolution's brand strength and tech edge keep it in the lead. ### The Bottom Line Evolution's Q2 results are a tale of two stories: solid profitability and cautious revenue growth. The Galaxy Gaming deal could be a game-changer, but uncertainty lingers. Investors should keep an eye on regulatory updates and Q3 numbers. If the acquisition goes through, Evolution could unlock new value. If not, the company will need to find other ways to reignite growth. Either way, Evolution remains a key player in online gaming. Its ability to adapt will determine whether it stays on top or starts to fade. For now, the industry is watching—and waiting.