Inspired Entertainment (NASDAQ: INSE) trims loss as revenue falls 19%
Rhea-AI Filing Summary
Inspired Entertainment, Inc. reported second-quarter 2026 revenue of $60.8 million, down from $80.3 million a year earlier, mainly due to the sale of its UK holiday parks business and changes to a pub operator model. Despite lower revenue, net operating income rose to $9.9 million from $7.9 million as cost of service, SG&A and other one-time costs declined.
For the first six months of 2026, revenue was $118.0 million versus $140.7 million in 2025, while net operating income nearly doubled to $19.1 million. The company posted a small year-to-date net loss of $0.3 million, a sharp improvement from a $7.9 million loss. Operating cash flow was $29.5 million, and long-term debt fell to $319.4 million after scheduled and voluntary repayments, leaving net leverage at 2.91x versus a 5.0x covenant.
Management had $22.0 million of cash and positive working capital at June 30, 2026 and believes available liquidity, together with expected cash generation and borrowing capacity, will cover net cash requirements through August 2027. The company repurchased 707,225 shares for approximately $5.2 million under its $25 million share repurchase program and continued to expand Virtual Sports and Interactive distribution through new agreements and market entries.
Positive
- Net operating income nearly doubled to $19.1 million for the first six months of 2026, from $9.5 million a year earlier, reflecting lower operating costs after the UK holiday parks divestiture and other restructuring.
- Leverage and debt profile improved: long-term debt declined to $319.4 million, with covenant net leverage at 2.91x versus a 5.0x maximum, supported by interest rate swaps now in a $1.6 million net asset position.
Negative
- Total revenue declined by 19% on a functional-currency basis for the first six months of 2026, to $118.0 million from $140.7 million, driven largely by the sale of the UK holiday parks business and changes to the UK pub operator model.
Filing Explained
The filing adds a $14.5 million equipment commitment and 1.63 million unvested RSUs to the disclosed share and debt mechanics.
As a Form 10-Q, this filing is an unaudited interim report, and it places the company’s operating, equity and contractual positions at
At that date, Inspired Entertainment had
The filing separately reports 1,630,176 unvested restricted stock units and 2,313,875 vested awards that had not yet been issued, so these are equity-linked amounts at different stages rather than one additional share issuance.
The company had
The senior notes mature on
The company also changed its reportable segments during the first quarter to Retail Solutions, Virtual Sports and Interactive, and recast prior-period segment information without changing consolidated results, assets or cash flows.
Key Figures
Key Terms
Senior Notes financial
Sterling Overnight Index Average financial
cash flow hedges financial
ISDA Master Agreement financial
consolidated senior secured net leverage ratio financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
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What is the liquidity position of Inspired Entertainment (INSE) as of June 30, 2026?
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For
the quarterly period ended
OR
For the transition period _______________
Commission
File Number:
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of | (I.R.S. Employer | |
| incorporation or organization) | Identification Number) |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s
telephone number, including area code:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically every Interactive Date File required to be submitted pursuant to Rule
405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ☐ | ||
| Non-accelerated filer ☐ | Smaller
reporting company | |
| Emerging
growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
As of July 31, 2026, there were shares of the Company’s common stock issued and outstanding.
TABLE OF CONTENTS
| PART I. | FINANCIAL INFORMATION | 1 |
| ITEM 1. | FINANCIAL STATEMENTS (Unaudited) | 1 |
| Condensed Consolidated Balance Sheets | 1 | |
| Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income | 2 | |
| Condensed Consolidated Statement of Stockholders’ Deficit | 3 | |
| Condensed Consolidated Statements of Cash Flows | 5 | |
| Notes to Condensed Consolidated Financial Statements | 6 | |
| ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | 21 |
| ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK | 41 |
| ITEM 4. | CONTROLS AND PROCEDURES | 42 |
| PART II. | OTHER INFORMATION | 43 |
| ITEM 1. | LEGAL PROCEEDINGS | 43 |
| ITEM 1A. | RISK FACTORS | 43 |
| ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS | 43 |
| ITEM 3. | DEFAULTS UPON SENIOR SECURITIES | 43 |
| ITEM 4. | MINE SAFETY DISCLOSURES | 43 |
| ITEM 5. | OTHER INFORMATION | 43 |
| ITEM 6. | EXHIBITS | 44 |
| SIGNATURES | 45 | |
| i |
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
References in this report to “we,” “us,” “our,” the “Company” and “Inspired” refer to Inspired Entertainment, Inc. and its subsidiaries unless the context suggests otherwise.
Certain statements and other information set forth in this report, including in Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere herein, may relate to future events and expectations, and as such constitute “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 27A of the Securities Act of 1933, as amended (the “Securities Act”). Our forward-looking statements include, but are not limited to, statements regarding our business strategy, plans and objectives and our expected or contemplated future operations, results, financial condition, beliefs and intentions. In addition, any statements that refer to projections, forecasts or other characterizations or predictions of future events or circumstances, including any underlying assumptions on which such statements are expressly or implicitly based, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “can,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “scheduled,” “seek,” “should,” “would” and similar expressions, among others, and negatives expressions including such words, may identify forward-looking statements.
Our forward-looking statements reflect our current expectations about our future results, performance, liquidity, financial condition, prospects and opportunities, and are based upon information currently available to us, our interpretation of what we believe to be significant factors affecting our business and many assumptions regarding future events. Actual results, performance, liquidity, financial condition, prospects and opportunities could differ materially from those expressed in, or implied by, our forward-looking statements. This could occur as a result of various risks and uncertainties, including the following:
| ● | government regulation and taxation of our industries; | |
| ● | our ability and our customers’ ability to compete effectively in our industries; | |
| ● | the impact of evolving and disruptive technologies, including artificial intelligence, on our business; | |
| ● | risks associated with the use, development and deployment of AI technologies | |
| ● | our ability to maintain relationships with suppliers; | |
| ● | our ability to protect and enforce our intellectual property rights, and to do so in all markets in which we operate; | |
| ● | our ability to protect our business against cybersecurity threats; | |
| ● | our ability to successfully grow by acquisition as well as organically; |
| ● | fluctuations due to seasonality; | |
| ● | our ability to attract and retain key members of our management team; | |
| ● | our need for working capital; | |
| ● | our ability to secure capital for growth and expansion; | |
| ● | changing consumer, technology and other trends in our industries; | |
| ● | our ability to successfully operate across multiple jurisdictions and markets around the world; | |
| ● | changes in local, regional and global economic and political conditions; | |
| ● | risks associated with responsible gaming, and social impact expectations, including heightened regulatory scrutiny and reputational impacts; and | |
| ● | other factors described in the reports and documents we file from time to time with the U.S. Securities and Exchange Commission (the “SEC”). |
In light of these risks and uncertainties, and others discussed in this report, there can be no assurance that any matters covered by our forward-looking statements will develop as predicted, expected or implied. Readers should not place undue reliance on any forward-looking statements. Except as expressly required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason. We advise you to carefully review the reports and documents we file from time to time with the SEC.
| ii |
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
INSPIRED ENTERTAINMENT, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions, except share data)
| June 30, 2026 | December 31, 2025 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash | $ | $ | ||||||
| Restricted cash | ||||||||
| Accounts receivable, net | ||||||||
| Inventory | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Corporate tax and other current taxes receivable | ||||||||
| Total current assets | ||||||||
| Property and equipment, net | ||||||||
| Software development costs, net | ||||||||
| Other acquired intangible assets subject to amortization, net | ||||||||
| Goodwill | ||||||||
| Finance lease right of use asset | ||||||||
| Operating lease right of use asset | ||||||||
| Costs of obtaining and fulfilling customer contracts, net | ||||||||
| Deferred tax | ||||||||
| Other assets | ||||||||
| Total assets | $ | $ | ||||||
| Liabilities and Stockholders’ Deficit | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | $ | ||||||
| Corporate tax and other current taxes payable | ||||||||
| Deferred revenue, current | ||||||||
| Operating lease liabilities | ||||||||
| Current portion of finance lease liabilities | ||||||||
| Other current liabilities | ||||||||
| Total current liabilities | ||||||||
| Long-term debt | ||||||||
| Finance lease liabilities, net of current portion | ||||||||
| Deferred revenue, net of current portion | ||||||||
| Operating lease liabilities | ||||||||
| Other long-term liabilities | ||||||||
| Total liabilities | ||||||||
| Commitments and contingencies | ||||||||
| Stockholders’ deficit | ||||||||
| Preferred stock; $ par value; shares authorized, shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively. | ||||||||
| Common stock; $ par value; shares authorized; shares and shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively | ||||||||
| Additional paid in capital | ||||||||
| Accumulated other comprehensive income | ||||||||
| Accumulated deficit | ( |
) | ( |
) | ||||
| Total stockholders’ deficit | ( |
) | ( |
) | ||||
| Total liabilities and stockholders’ deficit | $ | $ | ||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 1 |
INSPIRED ENTERTAINMENT, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(in millions, except share and per share data)
(Unaudited)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Revenue: | ||||||||||||||||
| Service | $ | $ | $ | $ | ||||||||||||
| Product sales | ||||||||||||||||
| Total revenue | ||||||||||||||||
| Cost of sales: | ||||||||||||||||
| Cost of service (1) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Cost of product sales (1) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Selling, general and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Depreciation and amortization | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net operating income | ||||||||||||||||
| Other expense | ||||||||||||||||
| Interest expense, net | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other finance income | ||||||||||||||||
| Total other expense, net | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net income (loss) before income taxes | ( | ) | ( | ) | ||||||||||||
| Income tax (expense) benefit | ( | ) | ( | ) | ( | ) | ||||||||||
| Net income (loss) | ( | ) | ( | ) | ( | ) | ||||||||||
| Other comprehensive (loss) income: | ||||||||||||||||
| Foreign currency translation (loss) gain | ( | ) | ( | ) | ( | ) | ||||||||||
| Change in fair value of hedging instrument | ( | ) | ||||||||||||||
| Reclassification of gain on hedging instrument to comprehensive income | ( | ) | ( | ) | ||||||||||||
| Reclassification of loss on pension plan to comprehensive income | ||||||||||||||||
| Other comprehensive (loss) income | ( | ) | ( | ) | ( | ) | ||||||||||
| Comprehensive (loss) income | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | ||||||
| Net income (loss) per common share – basic and diluted | $ | $ | ) | $ | ) | $ | ) | |||||||||
| Weighted average number of shares outstanding during the period – basic | ||||||||||||||||
| Weighted average number of shares outstanding during the period – diluted | ||||||||||||||||
| Supplemental disclosure of stock-based compensation expense | ||||||||||||||||
| Stock-based compensation included in: | ||||||||||||||||
| Selling, general and administrative expenses | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| (1) |
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 2 |
INSPIRED ENTERTAINMENT, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
FOR THE PERIOD JANUARY 1, 2026 TO JUNE 30, 2026
(in millions, except share data)
(Unaudited)
| Common stock | Additional paid in | Accumulated other comprehensive | Accumulated | Total stockholders’ equity | ||||||||||||||||||||
| Shares | Amount | capital | income | deficit | (deficit) | |||||||||||||||||||
| Balance as of January 1, 2026 | ( | ) | ( | ) | ||||||||||||||||||||
| Foreign currency translation adjustments | — | |||||||||||||||||||||||
| Change in fair value of hedging instrument | — | |||||||||||||||||||||||
| Reclassification of gain on hedging instrument to comprehensive income | — | ( | ) | ( | ) | |||||||||||||||||||
| Reclassification of loss on pension plan to comprehensive income | — | |||||||||||||||||||||||
| Issuances under stock plans | ||||||||||||||||||||||||
| Repurchase of common stock | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Stock-based compensation expense | — | |||||||||||||||||||||||
| Net loss | — | ( | ) | ( | ) | |||||||||||||||||||
| Balance as of March 31, 2026 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||
| Foreign currency translation adjustments | — | ( | ) | ( | ) | |||||||||||||||||||
| Change in fair value of hedging instrument | — | ( | ) | ( | ) | |||||||||||||||||||
| Reclassification of gain on hedging instrument to comprehensive income | — | ( | ) | ( | ) | |||||||||||||||||||
| Reclassification of loss on pension plan to comprehensive income | — | |||||||||||||||||||||||
| Issuances under stock plans | ||||||||||||||||||||||||
| Repurchase of common stock | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Stock-based compensation expense | — | |||||||||||||||||||||||
| Net income | — | |||||||||||||||||||||||
| Balance as of June 30, 2026 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 3 |
INSPIRED ENTERTAINMENT, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
FOR THE PERIOD JANUARY 1, 2025 TO JUNE 30, 2025
(in millions, except share data)
(Unaudited)
| Common stock | Additional paid in | Accumulated other comprehensive | Accumulated | Total stockholders’ | ||||||||||||||||||||
| Shares | Amount | capital | income | deficit | deficit | |||||||||||||||||||
| Balance as of January 1, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||
| Foreign currency translation adjustments | — | ( | ) | ( | ) | |||||||||||||||||||
| Reclassification of loss on pension plan to comprehensive income | — | |||||||||||||||||||||||
| Issuances under stock plans | ||||||||||||||||||||||||
| Stock-based compensation expense | — | |||||||||||||||||||||||
| Net loss | — | ( | ) | ( | ) | |||||||||||||||||||
| Balance as of March 31, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||
| Foreign currency translation adjustments | — | ( | ) | ( | ) | |||||||||||||||||||
| Reclassification of loss on pension plan to comprehensive income | — | |||||||||||||||||||||||
| Issuances under stock plans | ||||||||||||||||||||||||
| Stock-based compensation expense | — | |||||||||||||||||||||||
| Net loss | — | ( | ) | ( | ) | |||||||||||||||||||
| Balance as of June 30, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 4 |
INSPIRED ENTERTAINMENT, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
(Unaudited)
Six Months Ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||
| Depreciation and amortization | ||||||||
| Amortization of finance lease right of use asset | ||||||||
| Amortization of operating lease right of use asset | ||||||||
| Stock-based compensation expense | ||||||||
| Amortization of deferred financing fees relating to senior debt | ||||||||
| Deferred tax | ( | ) | ||||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable | ||||||||
| Inventory | ||||||||
| Prepaid expenses and other assets | ( | ) | ||||||
| Corporate tax and other current taxes payable | ( | ) | ( | ) | ||||
| Accounts payable and accrued expenses | ( | ) | ||||||
| Deferred revenue and customer prepayment | ( | ) | ||||||
| Operating lease liabilities | ( | ) | ( | ) | ||||
| Pension contributions | ( | ) | ( | ) | ||||
| Other long-term liabilities | ( | ) | ||||||
| Net cash provided by operating activities | ||||||||
| Cash flows from investing activities: | ||||||||
| Purchases of property and equipment | ( | ) | ( | ) | ||||
| Purchases of capital software and internally developed costs | ( | ) | ( | ) | ||||
| Contract cost expense | ( | ) | ( | ) | ||||
| Net cash used in investing activities | ( | ) | ( | ) | ||||
| Cash flows from financing activities: | ||||||||
| Debt introduced | ||||||||
| Repayments of long-term debt | ( | ) | ( | ) | ||||
| Repayments of short-term debt | ( | ) | ||||||
| Repurchase of common stock | ( | ) | ||||||
| Debt fees incurred | ( | ) | ||||||
| Repayments of finance leases | ( | ) | ( | ) | ||||
| Net cash (used in) provided by financing activities | ( | ) | ||||||
| Effect of exchange rate changes on cash | ( | ) | ||||||
| Net (decrease) increase in cash | ( | ) | ||||||
| Cash, beginning of period | ||||||||
| Cash and restricted cash, end of period | $ | $ | ||||||
| Components of cash and restricted cash | ||||||||
| Cash | ||||||||
| Restricted cash | ||||||||
| Total cash and restricted cash, end of period | $ | $ | ||||||
| Supplemental cash flow disclosures | ||||||||
| Cash paid during the period for interest | $ | $ | ||||||
| Cash paid during the period for income taxes | $ | $ | ||||||
| Cash paid during the period for operating leases | $ | $ | ||||||
| Supplemental disclosure of non-cash investing and financing activities | ||||||||
| Lease liabilities arising from obtaining finance lease right of use assets | $ | $ | ( | ) | ||||
| Lease liabilities arising from obtaining operating lease right of use assets | $ | ( | ) | $ | ( | ) | ||
| Right of use property and equipment acquired through finance lease | $ | $ | ||||||
| Asset retirement obligation assets arising during the period | $ | $ | ||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 5 |
INSPIRED ENTERTAINMENT, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. Nature of Operations, Management’s Plans and Summary of Significant Accounting Policies
Company Description and Nature of Operations
We are a global gaming technology company, supplying content, platform and other products and services to licensed online and land-based lottery, betting and gaming operators worldwide through a broad range of distribution channels, on a business-to-business basis. We provide end-to-end digital gaming solutions (i) on our own proprietary and secure network, which accommodates a wide range of devices, including land-based gaming machine terminals, mobile devices and online computer applications and (ii) through third party networks. Our content and other products can be found through the consumer-facing portals of our customers operating digital channels, on aggregator platforms, and in licensed betting offices, adult gaming centers, pubs, bingo halls and motorway service areas for our customers operating land-based venues.
Management Liquidity Plans
As
of June 30, 2026, the Company’s cash on hand, excluding restricted cash, was $
Historically,
the Company has generally had positive cash flows from operating activities and has relied on a combination of cash flows provided by
operations and the incurrence of debt and/or the refinancing of existing debt to fund its obligations. Cash flows provided by operations
amounted to $
Management currently believes that the Company’s cash balances on hand, cash flows expected to be generated from operations, ability to control and defer capital projects and amounts available from the Company’s external borrowings will be sufficient to fund the Company’s net cash requirements through August 2027.
Basis of Presentation
The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations, or cash flows. It is management’s opinion, however, that the accompanying unaudited interim condensed consolidated financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.
The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements and notes thereto for the year ended December 31, 2025. The financial information as of December 31, 2025 is derived from the audited consolidated financial statements presented in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC on March 10, 2026, as amended on May 22, 2026 (the “2025 Form 10-K”). The financial information for the three and six months ended June 30, 2025 is derived from the unaudited consolidated financial statements presented in the Company’s Quarterly Report on Form 10-Q for the three and six months ended June 30, 2025 filed with the SEC on August 6, 2025. The interim results for the three and six months ended June 30, 2026 are not necessarily indicative of the results to be expected for the year ending December 31, 2026 or for any future interim periods.
| 6 |
2. Allowance for Credit Losses
Changes in the allowance for credit losses are as follows:
June 30, 2026 | December 31, 2025 | |||||||
| (in millions) | ||||||||
| Beginning balance | $ | ( | ) | $ | ( | ) | ||
| Additional allowance for credit losses on contracts with customers | ( | ) | ||||||
| Write offs | ||||||||
| Foreign currency translation adjustments | ||||||||
| Ending balance | $ | ( | ) | $ | ( | ) | ||
3. Inventory
Inventory consists of the following:
June 30, 2026 | December 31, 2025 | |||||||
| (in millions) | ||||||||
| Component parts | $ | $ | ||||||
| Work in progress | ||||||||
| Finished goods | ||||||||
| $ | $ | |||||||
Component parts include parts for gaming terminals. Our finished goods inventory primarily consists of gaming terminals which are ready for sale.
4. Prepaid Expenses and Other Assets
Prepaid expenses and other assets consist of the following:
June 30, 2026 | December 31, 2025 | |||||||
| (in millions) | ||||||||
| Prepaid expenses and other assets | $ | $ | ||||||
| Fair value of hedging instrument | ||||||||
| Unbilled accounts receivable | ||||||||
| $ | $ | |||||||
5. Accounts Payable and Accrued Expenses
Accounts payable and accrued expenses consist of the following:
June 30, 2026 | December 31, 2025 | |||||||
| (in millions) | ||||||||
| Accounts payable | $ | $ | ||||||
| Intellectual property licenses | ||||||||
| Payroll and related costs | ||||||||
| Cost of sales including inventory | ||||||||
| Other creditors | ||||||||
| $ | $ | |||||||
| 7 |
6. Contract Related Disclosures
The following table summarizes contract related balances:
Accounts Receivable | Unbilled Accounts Receivable | Right to recover asset | Deferred Income | Customer Prepayments and Deposits | ||||||||||||||||
| (in millions) | ||||||||||||||||||||
| At June 30, 2026 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||
| At December 31, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||
During
the six months ended June 30, 2026 and 2025, the Company recognized $
No significant amounts of revenue were recognized during the periods presented as a result of changes in contract transaction prices related to performance obligations satisfied in prior periods.
Transaction Price Allocated to Remaining Performance Obligations
At
June 30, 2026, in respect of contracts exceeding one year duration, the aggregate amount of the transaction price allocated to
the performance obligations which are unsatisfied (or partially unsatisfied) at the end of the reporting period was approximately $
7. Long Term Debt
Senior Notes
Long-term
debt consists of £
The Notes Purchase Agreement which governs the Senior Notes requires that the Company maintain a maximum consolidated senior secured net leverage ratio of 5.0x on the test date for the relevant periods ended or ending September 30, 2025, December 31, 2025, March 31, 2026, June 30, 2026, September 30, 2026, December 31, 2026 and March 31, 2027, stepping down to 4.75x on June 30, 2027 and each relevant period thereafter (the “Notes Financial Covenant”). The Notes Financial Covenant is calculated as the ratio of consolidated senior secured net debt to consolidated pro forma EBITDA (defined as consolidated net income after adding back certain items including (without limitation) interest expense, taxes, depreciation and amortization expenses and exceptional or non-recurring costs and losses and after adjusting for certain projected savings and synergies) for the 12-month period preceding the relevant quarterly testing date and is tested quarterly on a rolling basis. The Notes Purchase Agreement does not include a minimum interest coverage ratio or other financial covenants. Covenant testing at June 30, 2026 showed covenant compliance with a net leverage of 2.91x.
On
March 6, 2026, as permitted by the Notes Purchase Agreement, the Company repaid £
| 8 |
8. Derivatives and Hedging Activities
On
November 12, 2025, subsidiaries of the Company entered into two interest rate swap agreements with Macquarie Bank Limited designed
to manage our exposure to interest rate volatility associated with our Senior Notes. The swaps are effective from December 9, 2025,
until maturity on
Risk Management Objective of Using Derivatives
The Company is exposed to certain risk arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its assets and liabilities and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company’s known or expected cash receipts and its known or expected cash payments principally related to the Company’s borrowings.
Cash Flow Hedges of Interest Rate Risk
The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. During the six months ended June 30, 2026, such derivatives were used to hedge the variable cash flows associated with existing variable-rate debt.
For
derivatives designated and that qualify as cash flow hedges of interest rate risk, the gain or loss on the derivative is recorded in
Accumulated Other Comprehensive Income and subsequently reclassified into interest expense in the same period(s) during which the hedged
transaction affects earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified
to interest expense as interest payments are made on the Company’s variable-rate debt. During the next twelve-months, the Company
estimates that an additional $
| 9 |
As of June 30, 2026, and December 31, 2025, the Company had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk:
| Interest Rate Derivative | Number of Instruments |
Notional | ||
| Interest rate swaps | £ |
The table below presents the fair value of the Company’s derivative financial instruments as well as their classification in the consolidated balance sheet as of June 30, 2026 and December 31, 2025.
| June 30, 2026 | December 31, 2025 | |||||||
| (in millions) | ||||||||
| Other short-term assets | $ | $ | ||||||
| Other long-term assets | ||||||||
| Other current liabilities | ( | ) | ||||||
| Other long-term liabilities | ( | ) | ||||||
| Total derivatives designated as hedging instruments | $ | $ | ( | ) | ||||
There was no effect of offsetting of the derivative financial instruments at June 30, 2026 or December 31, 2025.
The tables below present the effect of fair value and cash flow hedge accounting on accumulated other comprehensive income for the six months ended June 30, 2026 and June 30, 2025.
Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives
Six Months Ended June 30, 2026 | Six Months Ended June 30, 2025 | |||||||
| (in millions) | ||||||||
| Interest rate products | $ | $ | ||||||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
Six Months Ended June 30, 2026 | Six Months Ended June 30, 2025 | |||||||
| (in millions) | ||||||||
| Interest expense, net | $ | $ | ||||||
| 10 |
The tables below present the effect of the Company’s derivative financial instruments on the consolidated statements of operations for the six months ended June 30, 2026 and June 30, 2025.
Six Months Ended June 30, 2026 | Six Months Ended June 30, 2025 | |||||||
| (in millions) | ||||||||
| Total amounts of income and expense line items presented in the statement of operations and comprehensive loss in which the effects of fair value or cash flow hedges are recorded | ||||||||
| Interest expense, net | $ | ( | ) | $ | ( | ) | ||
Six Months Ended June 30, 2026 | Six Months Ended June 30, 2025 | |||||||
| (in millions) | ||||||||
| Amount of gain (loss) reclassified from accumulated other comprehensive income into income | ||||||||
| Interest expense, net | $ | $ | ||||||
Credit-risk-related Contingent Features
In November 2025, each of Inspired Gaming (UK) Limited and Gaming Acquisitions Limited, wholly owned (indirect) subsidiaries of the Company (each, a “Hedging Subsidiary”), entered into an industry standard ISDA Master Agreement, with a negotiated Schedule thereto (each, an “ISDA Agreement”), with Macquarie Bank Limited, the counterparty to the derivative transactions, and which ISDA Agreements set forth various provisions which govern the relationship between each such Hedging Subsidiary and the counterparty with respect to such derivative instruments. Such provisions include certain events which, if triggered by either party, may give rise to a termination of the relevant derivative instruments, which may trigger a requirement for the exchange of a breakage payment between the parties.
Each ISDA Agreement contains a provision whereby if any of the Company’s subsidiaries that has granted credit support in respect of such derivative transactions defaults on any of its indebtedness above a threshold amount, including default where repayment of such indebtedness has not been accelerated by the relevant creditor, then the relevant Hedging Subsidiary could also be declared in default on its derivative obligations. Each ISDA Agreement also contains a provision where the relevant Hedging Subsidiary could be declared in default on its derivative obligations if repayment of the underlying indebtedness is accelerated by the lender due to the relevant Hedging Subsidiary’s default on its indebtedness.
As of June 30, 2026, no derivatives were in a net liability position. As of June 30, 2026, no Hedging Subsidiary has posted any collateral related to the ISDA Agreement, as no collateral is required under the terms thereof. If the Hedging Subsidiaries had breached any of the provisions under the terms which resulted in an acceleration of the ISDA Agreements, as at June 30, 2026, no assets would have been required for the Company to settle its obligations under the respective ISDA Agreements.
9. Fair Value Measurements
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset and liability in an orderly transaction between market participants at the measurement date. We estimate the fair value of our assets and liabilities utilizing an established three-level hierarchy. The hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date as follows:
| Level 1: | Quoted prices in active markets for identical assets or liabilities. | |
| Level 2: | Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets with insufficient volume or infrequent transactions (less active markets), or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated with observable market data for substantially the full term of the assets or liabilities. Level 2 inputs also include non-binding market consensus prices that can be corroborated with observable market data, as well as quoted prices that were adjusted for security-specific restrictions. | |
| Level 3: | Unobservable inputs that are supported by little or no market activity that are significant to the fair value of the asset or liability. Level 3 inputs also include non-binding market consensus prices or non-binding broker quotes that are unable to be corroborated with observable market data. |
| 11 |
The fair value of our financial assets and liabilities is determined by reference to market data and other valuation techniques as appropriate. We believe the fair value of our financial instruments approximates their recorded values.
For each period, derivative financial instrument assets and liabilities measured at fair value on a recurring basis are included in the financial statements as per the table below.
| June 30, | December 31, | |||||||||||
| Level | 2026 | 2025 | ||||||||||
| (in millions) | ||||||||||||
| Derivative asset (see note 8) | 2 | $ | $ | |||||||||
| Derivative liability (see note 8) | 2 | $ | $ | ( | ) | |||||||
Level 3 liabilities are valued using unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the derivative liabilities. For fair value measurements categorized within Level 3 of the fair value hierarchy, the Company’s Principal Financial and Accounting Officer determines its valuation policies and procedures. The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Company’s Principal Financial and Accounting Officer.
At June 30, 2026 and December 31, 2025, there were no Level 3 inputs, and no transfers in or out of Level 3 from other levels in the fair value hierarchy.
| Number of Shares | ||||
| Unvested Outstanding at January 1, 2026 | ||||
| Granted (1) | ||||
| Forfeited | ( | ) | ||
| Vested | ( | ) | ||
| Unvested Outstanding at June 30, 2026 | ||||
| (1) |
The Company issued a total of shares during the six months ended June 30, 2026, in connection with the Company’s equity-based plans, which primarily reflected the net settlement of RSUs that vested on December 31, 2025.
11. Accumulated Other Comprehensive (Income) Loss
The accumulated balances for each classification of comprehensive (income) loss are presented below:
Foreign Currency Translation Adjustments | Fair Value of Hedging Instrument | Unrecognized Pension Benefit Costs | Accumulated Other Comprehensive (Income) | |||||||||||||
| (in millions) | ||||||||||||||||
| Balance at January 1, 2026 | $ | ( | ) | $ | $ | $ | ( | ) | ||||||||
| Change during the period | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Balance at March 31, 2026 | ( | ) | ( | ) | ( | ) | ||||||||||
| Change during the period | ( | ) | ||||||||||||||
| Balance at June 30, 2026 | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | ||||||
Foreign Currency Translation Adjustments | Fair Value of Hedging Instrument | Unrecognized Pension Benefit Costs | Accumulated Other Comprehensive (Income) | |||||||||||||
| (in millions) | ||||||||||||||||
| Balance at January 1, 2025 | $ | ( | ) | $ | $ | $ | ( | ) | ||||||||
| Change during the period | ( | ) | ||||||||||||||
| Balance at March 31, 2025 | $ | ( | ) | $ | $ | $ | ( | ) | ||||||||
| Change during the period | ( | ) | ||||||||||||||
| Balance at June 30, 2025 | $ | ( | ) | $ | $ | $ | ( | ) | ||||||||
| 12 |
Basic income/loss per share (“EPS”) is computed by dividing net income/loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential shares of common stock outstanding during the period, including stock options and RSUs, unless the inclusion would be anti-dilutive.
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| RSUs | ||||||||||||||||
Income (Numerator) (in millions) | Shares (Denominator) | Per-Share Amount | ||||||||||
| Basic EPS | ||||||||||||
| Income available to common stockholders | $ | $ | ||||||||||
| Effect of Dilutive Securities | ||||||||||||
| RSUs | $ | |||||||||||
| Diluted EPS | ||||||||||||
| Income available to common stockholders | $ | $ | ||||||||||
There were no reconciling items for the six months ended June 30, 2026, or the three and six months ended June 30, 2025.
The calculation of Basic EPS includes the effects of and shares for the three and six months ended June 30, 2026 and 2025, respectively, with respect to RSU awards that have vested but have not yet been issued.
| 13 |
13. Repurchase of Common Stock
In
November 2025, the Board of Directors authorized the Company to use up to $
During
the six months ended June 30, 2026, the Company repurchased shares under the Share Repurchase Program for gross payments of approximately
$
Refer to Part II, Item 2 of this report for further details regarding shares repurchased during the three months ended June 30, 2026.
14. Other Finance Income
Other finance income consisted of the following:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| (in millions) | (in millions) | |||||||||||||||
| Pension interest cost | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Expected return on pension plan assets | ||||||||||||||||
| $ | $ | $ | $ | |||||||||||||
15. Income Taxes
The
effective income tax rate for the three months ended June 30, 2026 and 2025 was
The effective tax rate reported in any given year will continue to be influenced by a variety of factors, including the level of pre-tax income or loss, the income mix between jurisdictions, and any discrete items that may occur.
16. Related Parties
Macquarie
Bank Limited (“Macquarie Bank”) (a party to our interest rate swap agreements, as described in Note 8) and Macquarie
Corporate Holdings Pty Limited (UK Branch) (“Macquarie UK”) (an arranger and lending party under our previous revolving
credit facility (“RCF”) which was repaid on June 9, 2025) are affiliates of MIHI LLC, which beneficially owned
approximately
Richard
Weil, the brother of A. Lorne Weil, our Executive Chairman, provides consulting services to the Company relating to our lottery operations
under a consultancy agreement dated December 31, 2021, as amended and extended. The aggregate amount incurred by the Company in consulting
fees was $
| 14 |
17. Leases
Certain of our arrangements include leases for equipment installed at customer locations. As the lessor, we combine lease and non-lease components for all classes of underlying assets in arrangements that involve operating leases. The single combined component is accounted for under ASC 606, Revenue from Contracts with Customers based on the consideration that the non-lease components are the predominant items in the arrangements. If a component cannot be combined, the consideration is allocated between the lease component and the non-lease component based on relative standalone selling price. The lease component is accounted for under ASC 842, Leases and the non-lease component is accounted for under ASC 606.
Lease income from operating leases is not material for any of the periods presented. Lease income from sales type leases is as follows:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| (in millions) | (in millions) | |||||||||||||||
| Interest receivable | $ | $ | $ | $ | ||||||||||||
| Profit recognized at commencement date of sales type leases | ||||||||||||||||
| $ | $ | $ | $ | |||||||||||||
18. Commitments and Contingencies
Employment Agreements
We are party to employment agreements with our executive officers and other employees of the Company and our subsidiaries which contain, among other terms, provisions relating to severance and notice requirements.
Legal Matters
From time to time, the Company may become involved in lawsuits and legal matters arising in the ordinary course of business. While the Company believes that, currently, it has no such matters that are material, there can be no assurance that existing or new matters arising in the ordinary course of business will not have a material adverse effect on the Company’s business, financial condition or results of operations.
Purchase Commitments
At
June 30, 2026, the Company had commitments to purchase property and equipment amounting to $
| 15 |
19. Pension Plan
We operate a defined contribution plan in the US, and both defined benefit and defined contribution pension schemes in the UK. The defined contribution scheme assets are held separately from those of the Company in independently administered funds.
Defined Benefit Pension Scheme
The defined benefit plan has been closed to new entrants since April 1, 1999 and closed to future accruals for services rendered to the Company for the entire financial statement periods presented. The latest triennial actuarial valuation of the plan as at March 31, 2024, which was finalized in March 2025, determined that the statutory funding objective was not met, i.e., there were insufficient assets to cover the plan’s technical provisions and there was a funding shortfall.
In
March 2025, a recovery plan was put in place to eliminate the funding shortfall. The recovery plan included a requirement for the plan
actuary to assess the funding position of the plan at March 31, 2026 and if the funding level at that point was less than 100% the Company
would pay a single lump sum contingent contribution calculated as the lower of the deficit calculated by the plan actuary at March 31,
2026 and £
The following table presents the components of our net periodic pension cost:
Six Months Ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| (in millions) | ||||||||
| Components of net periodic pension cost: | ||||||||
| Interest cost | $ | $ | ||||||
| Expected return on plan assets | ( | ) | ( | ) | ||||
| Amortization of net loss | ||||||||
| Net periodic cost | $ | $ | ||||||
| 16 |
20. Segment Reporting and Geographic Information
Operating segments are identified as components of an enterprise for which separate and discrete financial information is available and is used by the chief operating decision maker, or decision-making group, (the “CODM”), in making decisions on how to allocate resources and assess performance. The Company’s CODM consists of our Executive Chairman and our President and Chief Executive Officer.
The Company’s CODM uses measures of segment profit and loss to evaluate the performance areas of 1) revenue and gross margin; 2) staff and non-staff expenses against budget; 3) investment in capitalized software development; and 4) additional cash expenditures impacting working capital. The CODM uses the information to allocate financial resources and drive operation decisions such as investing in new customers, products, geographies and refocusing commercial teams to drive new sales, accelerating or delaying staffing or other selling, general and administrative expenditures and ensuring technology staff utilization on new product development.
During the first quarter of 2026, we changed our reportable segments to align with changes in our internal management reporting structure and the manner in which the CODM assesses performance and allocates resources.
As
a result of these changes, the Company now reports the following reportable segments: Retail Solutions, Virtual Sports, and Interactive.
Previously, the Company reported the following reportable segments: Gaming, Virtual Sports, Interactive, and Leisure. The change in reportable
segments reflects organizational realignment and did not affect the Company’s consolidated financial position, results of operations,
or cash flows. We believe this method of
Prior-period segment information has been recast to conform to the current period presentation. The recast had no impact on previously reported consolidated totals.
The refence below to “Other segment items” consist of costs incurred in restructuring activities.
| 17 |
The following tables present revenue, cost of sales, excluding depreciation and amortization, staff-related selling, general and administrative expenses, non-staff related selling, general and administrative expenses, labor costs capitalized, depreciation and amortization, stock-based compensation expense, other segment items, operating profit/(loss) and total capital and other long-lived asset expenditures for the periods ended June 30, 2026 and June 30, 2025, respectively, by business segment. Certain unallocated corporate function costs have not been allocated to the Company’s reportable operating segments because these costs are not allocable and to do so would not be practical. Corporate function costs consist primarily of selling, general and administrative expenses, depreciation and amortization and capital expenditures relating to corporate/shared functions. Asset information by reportable segment is not given as this information is not provided to the Company’s CODM due to it not being considered necessary in order for the CODM to assess the reportable segments’ performance or to make decisions concerning the allocation of resources.
Segment Information
Three Months Ended June 30, 2026
| Retail Solutions | Virtual Sports | Interactive | Corporate Functions | Total | ||||||||||||||||
| (in millions) | ||||||||||||||||||||
| Revenue: | ||||||||||||||||||||
| Service | $ | $ | $ | $ | $ | |||||||||||||||
| Product sales | ||||||||||||||||||||
| Total revenue | ||||||||||||||||||||
| Cost of sales, excluding depreciation and amortization: | ||||||||||||||||||||
| Cost of service | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Cost of product sales | ( | ) | ( | ) | ||||||||||||||||
| Staff-related selling, general and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Non-staff related selling, general and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Labor costs capitalized | ||||||||||||||||||||
| Stock-based compensation expense | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Depreciation and amortization | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Other segment items | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Segment operating income (loss) | ( | ) | ||||||||||||||||||
| Net operating income | $ | |||||||||||||||||||
| Total capital and other long-lived asset expenditures for the three months ended June 30, 2026 | $ | $ | $ | $ | $ | |||||||||||||||
Three Months Ended June 30, 2025
| Retail Solutions | Virtual Sports | Interactive | Corporate Functions | Total | ||||||||||||||||
| (in millions) | ||||||||||||||||||||
| Revenue: | ||||||||||||||||||||
| Service | $ | $ | $ | $ | $ | |||||||||||||||
| Product sales | ||||||||||||||||||||
| Total revenue | ||||||||||||||||||||
| Cost of sales, excluding depreciation and amortization: | ||||||||||||||||||||
| Cost of service | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Cost of product sales | ( | ) | ( | ) | ||||||||||||||||
| Staff-related selling, general and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Non-staff related selling, general and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Labor costs capitalized | ||||||||||||||||||||
| Stock-based compensation expense | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Depreciation and amortization | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Other segment items | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Segment operating income (loss) | ( | ) | ||||||||||||||||||
| Net operating income | $ | |||||||||||||||||||
| Total capital and other long-lived asset expenditures for the three months ended June 30, 2025 | $ | $ | $ | $ | $ | |||||||||||||||
| 18 |
Six Months Ended June 30, 2026
| Retail Solutions | Virtual Sports | Interactive | Corporate Functions | Total | ||||||||||||||||
| (in millions) | ||||||||||||||||||||
| Revenue: | ||||||||||||||||||||
| Service | $ | $ | $ | $ | $ | |||||||||||||||
| Product sales | ||||||||||||||||||||
| Total revenue | ||||||||||||||||||||
| Cost of sales, excluding depreciation and amortization: | ||||||||||||||||||||
| Cost of service | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Cost of product sales | ( | ) | ( | ) | ||||||||||||||||
| Staff-related selling, general and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Non-staff related selling, general and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Labor costs capitalized | ||||||||||||||||||||
| Stock-based compensation expense | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Depreciation and amortization | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Other segment items | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Segment operating income (loss) | ( | ) | ||||||||||||||||||
| Net operating income | $ | |||||||||||||||||||
| Total capital and other long-lived asset expenditures for the six months ended June 30, 2026 | $ | $ | $ | $ | $ | |||||||||||||||
Six Months Ended June 30, 2025
| Retail Solutions | Virtual Sports | Interactive | Corporate Functions | Total | ||||||||||||||||
| (in millions) | ||||||||||||||||||||
| Revenue: | ||||||||||||||||||||
| Service | $ | $ | $ | $ | $ | |||||||||||||||
| Product sales | ||||||||||||||||||||
| Total revenue | ||||||||||||||||||||
| Cost of sales, excluding depreciation and amortization: | ||||||||||||||||||||
| Cost of service | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Cost of product sales | ( | ) | ( | ) | ||||||||||||||||
| Staff-related selling, general and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Non-staff related selling, general and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Labor costs capitalized | ||||||||||||||||||||
| Stock-based compensation expense | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Depreciation and amortization | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Other segment items | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Segment operating income (loss) | ( | ) | ||||||||||||||||||
| Net operating income | $ | |||||||||||||||||||
| Total capital and other long-lived asset expenditures for the six months ended June 30, 2025 | $ | $ | $ | $ | $ | |||||||||||||||
| 19 |
Geographic Information
Geographic information for revenue is set forth below:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| (in millions) | (in millions) | |||||||||||||||
| Total revenue | ||||||||||||||||
| UK | $ | $ | $ | $ | ||||||||||||
| Greece | ||||||||||||||||
| USA | ||||||||||||||||
| Rest of world | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
UK revenue includes revenue from customers headquartered in the UK, but whose revenue is generated globally.
Geographic information of our non-current assets excluding goodwill is set forth below:
June 30, 2026 | December 31, 2025 | |||||||
| (in millions) | ||||||||
| UK | $ | $ | ||||||
| Greece | ||||||||
| Rest of world | ||||||||
| Total | $ | $ | ||||||
Software development costs are included as attributable to the market in which they are utilized.
21. Customer Concentration
During
the three months ended June 30, 2026 one customer represented at least 10% of the Company’s revenue, accounting for
During
the six months ended June 30, 2026, there were two customers that represented at least 10% of the Company’s revenues, accounting
for approximately
At June 30, 2026 and December 31, 2025, there were no customers that represented at least 10% of the Company’s accounts receivable.
22. Subsequent Events
The Company evaluates subsequent events and transactions that occur after the balance sheet date up to the date that the financial statements were issued. The Company did not identify subsequent events that would have required adjustment or disclosure in the consolidated financial statements.
| 20 |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the financial statements and related notes thereto included elsewhere in this report. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual future results could differ materially from the historical results discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in the section titled “Risk Factors” included elsewhere in this report.
Forward-Looking Statements
We make forward-looking statements in this Management’s Discussion and Analysis of Financial Condition and Results of Operations. For definitions of the term Forward-Looking Statements, see the definitions provided in the “Cautionary Note Regarding Forward-Looking Statements” at the front part of this report.
Revenue
We generate revenue in four principal ways: i) on a participation basis, ii) on a fixed rental fee basis, iii) through product sales and iv) through software license fees. Participation revenue generally includes a right to receive a share of our customers’ gaming revenue, typically as a share of net win but sometimes as a share of the handle or “coin in” which represents the total amount wagered.
Geographic Range
Geographically, the majority of our revenue is derived from, and the majority of our non-current assets are attributable to, our UK operations. The remainder of our revenue is derived from, and non-current assets attributable to, Greece and the rest of the world (including North America).
For the three- and six-month periods ended June 30, 2026, we derived approximately 57% and 59% of our revenue from the UK (including customers headquartered in the UK but whose revenue is generated globally), respectively 10% and 9% from USA respectively; 11% and 11% from Greece, respectively; and the remaining 22% and 21% across the rest of the world. During the three- and six-month periods ended June 30, 2025, we derived approximately 72% and 69% from the UK, respectively; 5% (in both periods) from USA; 8% and 9% from Greece respectively; and the remaining 15% and 17% across the rest of the world.
As of June 30, 2026, our non-current assets (excluding goodwill) were attributable as follows: 71% to the UK, 16% to Greece and 13% across the rest of the world. As of June 30, 2025, our non-current assets (excluding goodwill) were attributable as follows: 73% to the UK, 13% to Greece and 14% across the rest of the world.
Foreign Exchange
Our results are affected by changes in foreign currency exchange rates as a result of the translation of foreign functional currencies into our reporting currency and the re-measurement of foreign currency transactions and balances. The impact of foreign currency exchange rate fluctuations represents the difference between current rates and prior-period rates applied to current activity. The geographic region in which the largest portion of our business is operated is the UK, and the British pound (“GBP”) is our functional currency. Our reporting currency is the U.S. dollar (“USD”). Our results are translated from our functional currency of GBP into the reporting currency of USD using average rates for profit and loss transactions and applicable spot rates for period-end balances. The effect of translating our functional currency into our reporting currency, as well as translating the results of foreign subsidiaries that have a different functional currency into our functional currency, is reported separately in Accumulated Other Comprehensive Income.
During the three- and six-month periods ended June 30, 2026, we derived approximately 43% and 41% respectively of our revenue from sales to customers outside the UK (see discussion above), compared to 28% and 31% respectively during the three- and six-month periods ended June 30, 2025.
In the section “Results of Operations” below, currency impacts shown have been calculated as the current-period average GBP:USD rate less the equivalent average rate in the prior year period, multiplied by the current period amount in our functional currency (GBP). The remaining difference, referred to as functional currency at constant rate, is calculated as the difference in our functional currency, multiplied by the prior-period average GBP:USD rate. This is not a U.S. GAAP measure, but one which management believes provides a useful indication of results. In the tables below, variances in particular line items from period to period exclude currency translation movements, and currency translation impacts are shown independently.
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Non-GAAP Financial Measures
We use certain financial measures that are not compliant with U.S. GAAP (“Non-GAAP financial measures”), including EBITDA and Adjusted EBITDA, to analyze our operating performance. In this discussion and analysis, we present certain non-GAAP financial measures, define and explain these measures and provide reconciliations to the most comparable U.S. GAAP measures. See “Non-GAAP Financial Measures” below.
Seasonality
Our results of operations can fluctuate due to seasonal trends and other factors. Sales of our gaming terminals can vary quarter to quarter due to both supply and demand factors.
Results of Operations
Our results are affected by changes in foreign currency exchange rates, primarily between our functional currency (GBP) and our reporting currency (USD). During the three-month periods ended June 30, 2026 and June 30, 2025, the average GBP:USD rates were 1.34 and 1.34, respectively, and rates for the six-month periods ended June 30, 2026 and June 30, 2025 were 1.34 and 1.30, respectively.
The following discussion and analysis of our results of operations has been organized in the following manner:
| ● | a discussion and analysis of the Company’s results of operations for the three- and six-month periods ended June 30, 2026, compared to the same periods in 2025; and | |
| ● | a discussion and analysis of the results of operations for each of the Company’s segments (Retail Solutions, Virtual Sports and Interactive) for the three- and six-month periods ended June 30, 2026, compared to the same periods in 2025, including key performance indicator (“KPI”) analysis. |
In the discussion and analysis below, certain data may vary from the amounts presented in our consolidated financial statements due to rounding.
For all reported variances, refer to the overall company and segment tables shown below. All variances discussed in the overall company and segment results are on a functional currency (at constant rate) basis, which excludes the impact of any changes in foreign currency exchange rates.
Key Events during the three-month period ended June 30, 2026
On May 18, 2026, the Company announced that James Richardson had stepped down from his role as Executive Vice President and Chief Financial Officer. The Company’s Board of Directors promoted Craig Wilson, previously Inspired’s Vice President of Finance and Accounting, to the role of Executive Vice President and Chief Financial Officer, effective May 14, 2026.
During the period ended June 30, 2026, the Retail Solutions segment was affected by a customer’s shop closures that resulted in the removal of a number of Vantage terminals from the field. The Company has agreements in place to redeploy the majority of these terminals within the retail estate during the remainder of 2026.
During the period ended June 30, 2026, the company broadened the distribution of its Virtual Sports portfolio through a new Software as a Service (“SaaS”) distribution agreement with Playtech (LSE: PTEC). Under the agreement, Inspired’s Virtual Sports portfolio will be integrated into Playtech’s Sportsbook platform and accessible to operators worldwide. The SaaS solution features a cloud-hosted back-end integration with Playtech, allowing for modular delivery that can be adapted to customer needs.
During the period a company subsidiary was approved by the Alberta Gaming, Liquor and Cannabis Commission (AGLC) and obtained registration as an iGaming Goods or Services Supplier-Critical Gaming Systems (IGCS) allowing it to launch both interactive and virtual products into the newly regulated market. Content was launched subsequent to quarter end, further strengthening the Company’s presence across North America.
During the period the company Interactive segment launched its iGaming portfolio in South Africa, enabled through its ongoing agreement with Light & Wonder and distributed via the Light & Wonder iGaming content marketplace.
Key agreements signed during the period include a four-year contract extension as the exclusive provider of gaming terminals and content to Paddy Power, and a three year contract extension with Mecca Bingo for providing service, maintenance and logistics services to gaming machines installed at ‘Mecca’ bingo halls and Adult Gaming Centre’s (“AGCs”) in the UK.
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Overall Company Results
Three and Six Months ended June 30, 2026, compared to Three and Six Months ended June 30, 2025
For the Three-Month | Variance | For the Six-Month | Variance | |||||||||||||||||||||||||||||||||||||||||||||
| Period ended | 2026 vs 2025 | Period ended | 2026 vs 2025 | |||||||||||||||||||||||||||||||||||||||||||||
| (In millions) | June 30, 2026 | June 30, 2025 | Variance Attributable to Currency Movement | Variance on a Functional currency basis | Total Functional Currency Variance % | Total Reported Variance % | June 30, 2026 | June 30, 2025 | Variance Attributable to Currency Movement | Variance on a Functional currency basis | Total Functional Currency Variance % | Total Reported Variance % | ||||||||||||||||||||||||||||||||||||
| Revenue: | ||||||||||||||||||||||||||||||||||||||||||||||||
| Service | $ | 54.3 | $ | 73.8 | $ | 0.3 | $ | (19.8 | ) | (27 | )% | (26 | )% | $ | 107.6 | $ | 130.8 | $ | 3.5 | $ | (26.7 | ) | (200 |
)% | (18 | )% | ||||||||||||||||||||||
| Product | 6.5 | 6.5 | - | - | - | - | 10.4 | 9.9 | 0.2 | 0.3 | 3 | % | 5 | % | ||||||||||||||||||||||||||||||||||
| Total revenue | 60.8 | 80.3 | 0.3 | (19.8 | ) | (25 | )% | (24 | )% | 118.0 | 140.7 | 3.7 | (26.4 | ) | (19 | )% | (16 | )% | ||||||||||||||||||||||||||||||
| Cost of Sales, excluding depreciation and amortization: | ||||||||||||||||||||||||||||||||||||||||||||||||
| Cost of Service | (8.7 | ) | (21.2 | ) | 0.1 | 12.4 | (58 | )% | (59 | )% | (17.3 | ) | (36.2 | ) | (0.2 | ) | 19.1 | (53 | )% | (52 | )% | |||||||||||||||||||||||||||
| Cost of Product | (3.5 | ) | (4.0 | ) | - | 0.5 | (13 | )% | (13 | )% | (6.1 | ) | (6.9 | ) | (0.1 | ) | 0.9 | (13 | )% | (12 | )% | |||||||||||||||||||||||||||
| Staff-related selling general and administrative expenses | (14.9 | ) | (18.7 | ) | (0.2 | ) | 4.0 | (21 | )% | (20 | )% | (27.7 | ) | (33.9 | ) | (1.3 | ) | 7.5 | (22 | )% | (18 | )% | ||||||||||||||||||||||||||
| Non-staff related selling, general and administrative expenses | (9.2 | ) | (11.8 | ) | - | 2.6 | (22 | )% | (22 | )% | (21.6 | ) | (24.2 | ) | (0.9 | ) | 3.5 | (14 | )% | (11 | )% | |||||||||||||||||||||||||||
| Labor costs capitalized | 2.6 | 3.8 | - | (1.2 | ) | (32 | )% | (32 | )% | 5.4 | 7.3 | 0.1 | (2.0 | ) | (27 | )% | (26 | )% | ||||||||||||||||||||||||||||||
| Other segment items: | ||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | (1.6 | ) | (1.8 | ) | - | 0.2 | (11 | )% | (11 | )% | (3.0 | ) | (3.2 | ) | (0.1 | ) | 0.3 | (9 | )% | (6 | )% | |||||||||||||||||||||||||||
| Depreciation and amortization | (14.5 | ) | (15.3 | ) | (0.1 | ) | 0.9 | (6 | )% | (5 | )% | (27.0 | ) | (25.9 | ) | (0.8 | ) | (0.3 | ) | 1 | % | 4 | % | |||||||||||||||||||||||||
| Other selling, general and administrative expenses | (1.1 | ) | (3.4 | ) | - | 2.3 | (68 | )% | (68 | )% | (1.6 | ) | (8.2 | ) | (0.1 | ) | 6.7 | (82 | )% | (80 | )% | |||||||||||||||||||||||||||
| Net operating Income (Loss) | 9.9 | 7.9 | 0.1 | 1.9 | 24 | % | 25 | % | 19.1 | 9.5 | 0.3 | 9.3 | 98 | % | 101 | % | ||||||||||||||||||||||||||||||||
| Other income (expense) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Interest expense, net | (9.5 | ) | (7.1 | ) | - | (2.4 | ) | 34 | % | 34 | % | (20.0 | ) | (14.1 | ) | (0.6 | ) | (5.3 | ) | 38 | % | 42 | % | |||||||||||||||||||||||||
| Other finance income (expense) | 0.2 | 0.2 | - | - | - | - | 0.3 | 0.4 | - | (0.1 | ) | (25 | )% | (25 | )% | |||||||||||||||||||||||||||||||||
| Total other income (expense), net | (9.3 | ) | (6.9 | ) | - | (2.4 | ) | 35 | % | 35 | % | (19.7 | ) | (13.7 | ) | (0.6 | ) | (5.4 | ) | 39 | % | 44 | % | |||||||||||||||||||||||||
| Net Income (loss) from continuing operations before income taxes | 0.6 | 1.0 | 0.1 | (0.5 | ) | (50 | )% | (40 | )% | (0.6 | ) | (4.2 | ) | (0.3 | ) | 3.9 | (93 | )% | (86 | )% | ||||||||||||||||||||||||||||
| Income tax expense | (0.4 | ) | (8.8 | ) | 0.1 | 8.3 | (94 | )% | (95 | )% | 0.3 | (3.7 | ) | 0.4 | 3.6 | (97 | )% | (108 | )% | |||||||||||||||||||||||||||||
| Net Income (Loss) | $ | 0.2 | $ | (7.8 | ) | $ | 0.2 | $ | 7.8 | (100 | )% | (103 | )% | $ | (0.3 | ) | $ | (7.9 | ) | $ | 0.1 | $ | 7.5 | (95 | )% | (96 | )% | |||||||||||||||||||||
| Exchange Rate - $ to £ | 1.34 | 1.34 | 1.34 | 1.30 | ||||||||||||||||||||||||||||||||||||||||||||
See “Segments Results” below for a more detailed explanation of the significant changes in our components of revenue within the individual segment results of operations.
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Revenue (for the three and six months ended June 30, 2026, compared to the three and six months ended June 30, 2025)
Consolidated Reported Revenue by Segment
For the three-month period ended June 30, 2026, Total Revenue on a functional currency (at constant rate) basis decreased by $19.8 million or 25% compared to the three-month period ended June 30, 2025 and for the six-month period ended June 30, 2026, total revenue on a functional currency basis decreased by $26.4 million or 19% compared to the six-month period ended June 30, 2025.
For the three-month period ended June 30, 2026 compared to the three-month period ended June 30, 2025, Retail Solutions revenue declined by $21.5 million, due to a decrease in service revenue, primarily reflecting the sale of the UK holiday parks business and certain associated leisure assets in November 2025, and the pub operator model change. Virtual Sports revenue declined by $0.4 million, due to a decrease in online revenue, while Interactive revenue grew by $2.0 million, due to growth in the UK, mainland Europe and North American markets. UK growth was partially offset by higher UK remote gaming taxes.
For the six-month period ended June 30, 2026 compared to the six-month period ended June 30, 2025, Retail Solutions revenue declined by $31.1 million, predominantly due to a decrease in service revenue of $31.4 million, reflecting the sale of the UK holiday parks business and certain associated leisure assets, and the pub operator model change. This was partially offset by an increase in product sales of $0.3 million (reflecting the variable nature of terminal sales).
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Cost of Sales, excluding depreciation and amortization
Cost of sales, excluding depreciation and amortization, for the three- and six-month periods ended June 30, 2026, decreased by $12.9 million and $20.0 million, or 51% and 46%, respectively, compared to the three- and six-month periods ended June 30, 2025. The decreases were predominantly driven by a $12.4 million and $19.1 million decrease in cost of service, respectively, primarily due to the sale of the UK holiday parks business and certain leisure assets and the pub operator business model change, as well as a $0.5 million and $0.9 million decrease in cost of product, respectively, attributable to the same restructuring activity.
Staff related selling, general and administrative expenses
Staff related selling, general and administrative expenses for the three- and six-month periods ended June 30, 2026 decreased by $4.0 million, and $7.5 million, or 21% and 22%, respectively compared to the threes and six-month periods ended June 30, 2025. This was predominantly related to the sale of the UK holiday parks business and certain associated leisure assets.
Non-staff related selling, general and administrative expenses
Non-staff related selling, general and administrative expenses for the three- and six-month periods ended June 30, 2026 decreased by $2.6 million and $3.5 million, or 22% and 14%, respectively, compared to the three- and six-month periods ended June 30, 2025.
The decrease in the three-month period ended June 30, 2026, compared to the three-month period ended June 30, 2025, was mainly driven by lower facility costs of $1.0 million, fleet costs of $0.9 million (both related to the sale of the UK holiday parks business and certain leisure assets and the pub operator business model restructuring activity), professional fees of $0.4 million and storage costs of $0.3 million.
The decrease in the six-month period ended June 30, 2026, compared to the period ended June 30, 2025 was driven by lower fleet costs of $1.7 million, facility costs of $1.6 million (both related to the sale of the UK holiday parks business and certain leisure assets and the pub operator business model restructuring activity) and storage costs of $0.6 million partially offset by higher professional fees of $0.5 million.
Stock-based compensation
During the three- and six-month periods ended June 30, 2026, the Company recorded expenses of $1.6 million and $3.0 million, respectively, compared to expenses of $1.8 million and $3.2 million for the three- and six-month periods ended June 30, 2025. All expenses related to outstanding awards.
Depreciation and amortization
Depreciation and amortization for the three-month period ended June 30, 2026 decreased by $0.9 million compared to the three-month period ended June 30, 2025, mainly driven by a decrease in Retail Solutions of $1.3 million due to the sale of the UK holiday parks business and certain leisure assets and pub operator business model, partially offset by increases in Virtual Sports of $0.7 million and Interactive of $0.3 million for increased software development and intangible assets.
Depreciation and amortization for the six-month period ended June 30, 2026 increased by $0.3 million compared to the six-month period ended June 30, 2025. This increase was driven by increases in Virtual Sports of $1.5 million and Interactive of $0.6 million, partially offset by a reduction in Retail Solutions of $1.3 million mainly due to the sale of the UK holiday parks business and certain leisure assets and the pub operator business model restructuring activity.
Other selling, general and administrative expenses
Other selling, general and administrative expenses for the three- and six-month periods ended June 30, 2026, decreased by $2.3 million and $6.7 million, or 68% and 82%, respectively compared with the three- and six-month periods ended June 30, 2025. The decrease in the three-month period ended June 30, 2026, compared to the three-month period ended June 30, 2025 was primarily driven by the costs relating to refinancing during the three-month period ended June 30, 2025. The decrease in the six-month period ended June 30, 2026, compared to the period ended June 30, 2025, was driven by costs relating to the restructure of previously issued financial statements not repeated, expenses relating to restructuring costs, and costs relating to refinancing during the six-month period ended June 30, 2025.
Net operating income
During the three- and six-month periods ended June 30, 2026, net operating income was $9.9 million and $19.1 million, respectively, representing an increase of $1.9 million and $9.3 million, respectively, compared to the three- and six-month periods ended June 30, 2025.
The increase in the three-month period ended June 30, 2026, compared to the three-month period ended June 30, 2025, was predominantly due to lower staff and non-staff related selling, general and administrative expenses (due to sale of the UK holiday parks business and certain leisure assets), and costs relating to refinancing during the three-month period ended June 30, 2025.
The growth in the six-month period ended June 30, 2026, compared to the six-month period ended June 30, 2025, was mainly due to lower staff and non-staff related selling, general and administrative expenses (due to sale of the UK holiday parks business and certain associated leisure assets), and costs relating to the restructure of previously issued financial statements not repeated, expenses relating to restructuring costs, and costs relating to refinancing during the six-month period ended June 30, 2025.
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Net Income / (Loss)
For the three-month period ended June 30, 2026, net income was $0.2 million compared to a net loss of $7.8 million, primarily due to a decrease of income tax expense of $8.3 million (the effective rate in any given year is influenced by a variety of factors including the level of pre-tax income or loss, the income mix between jurisdictions, and any discrete items that may occur), and the increase of net operating income of $1.9 million, partially offset by higher interest expense of $2.4 million.
For the six-month period ended June 30, 2026, net loss was $0.3 million compared to a net loss of $7.9 million mainly due to the increase of net operating income of $9.3 million and a favorable movement in income taxes of $3.6 million, partially offset by higher interest expense of $5.3 million.
Deferred Tax
The Company maintains a valuation allowance related to capital loss carryovers in the United Kingdom, state net operating losses unable to be utilized in the United States, and United States interest expected to be limited under Section 163(j).
Segment Results (for the three and six months ended June 30, 2026, compared to the three and six months ended June 30, 2025)
Retail Solutions
We generate revenue from our Retail Solutions segment through delivery of our gaming terminals preloaded with proprietary gaming software, server-based content, as well as services such as terminal repairs, maintenance, software upgrades and upgrades on a when and if available basis and content development. We receive rental fees for machines, typically in conjunction with long-term contracts, on both a participation and fixed fee basis. Our participation contracts are typically structured to pay us a percentage of net win (defined as net revenue to our operator customers, after deducting player winnings, free bets or plays and any relevant regulatory levies) from gaming terminals placed in our customers’ facilities. Typically, we recognize revenue from these arrangements on a daily basis over the term of the contract.
Revenue growth for our Retail Solutions business is principally driven by changes in (i) the number of operator customers we have, (ii) the number of Retail Solutions machines in operation, (iii) the net win performance of the machines and (iv) the net win percentage that we receive pursuant to our contracts with our customers.
Retail Solutions, Key Performance Indicators
For the Three-Month Period ended | Variance | For the Six-Month Period ended | Variance | |||||||||||||||||||||||||||||
| June 30, | June 30, | 2026 vs 2025 | June 30, | June 30, | 2026 vs 2025 | |||||||||||||||||||||||||||
| Retail Solutions | 2026 | 2025 | % | 2026 | 2025 | % | ||||||||||||||||||||||||||
| End of period installed base (# of terminals) (2) | 38,195 | 42,000 | (3,805 | ) | (9.1 | )% | 38,195 | 42,000 | (3,805 | ) | (9.1 | )% | ||||||||||||||||||||
| Total Retail Solutions - Average installed base (# of terminals) (2) | 38,704 | 42,087 | (3,383 | ) | (8.0 | )% | 38,923 | 42,076 | (3,153 | ) | (7.5 | )% | ||||||||||||||||||||
| Participation - Average installed base (# of terminals) (2) | 31,066 | 30,762 | 304 | 1.0 | % | 31,296 | 30,802 | 494 | 1.6 | % | ||||||||||||||||||||||
| Fixed Rental - Average installed base (# of terminals) | 12,518 | 16,304 | (3,786 | ) | (23.2 | )% | 12,557 | 15,265 | (2,708 | ) | (17.7 | )% | ||||||||||||||||||||
| Service Only - Average installed base (# of terminals) | 8,944 | 9,994 | (1,050 | ) | (10.5 | )% | 8,805 | 9,966 | (1,161 | ) | (11.6 | )% | ||||||||||||||||||||
| Customer Gross Win per unit per day (1) (2) | £ | 104.3 | £ | 99.3 | £ | 5.0 | 5.0 | % | £ | 103.1 | £ | 99.2 | £ | 3.9 | 3.9 | % | ||||||||||||||||
| Customer Net Win per unit per day (1) (2) | £ | 77.2 | £ | 73.5 | £ | 3.7 | 5.0 | % | £ | 76.0 | £ | 73.3 | £ | 2.7 | 3.7 | % | ||||||||||||||||
| Inspired Blended Participation Rate | 5.9 | % | 6.5 | % | (0.6 | )% | (9.2 | )% | 5.9 | % | 5.4 | % | 0.5 | % | 9.3 | % | ||||||||||||||||
| Inspired Fixed Rental Revenue per Retail Solutions Machine per week | £ | 37.0 | £ | 47.5 | £ | (10.5 | ) | (22.1 | )% | £ | 36.4 | £ | 48.6 | £ | (12.2 | ) | (25.1 | )% | ||||||||||||||
| Inspired Service Rental Revenue per Retail Solutions Machine per week | £ | 7.9 | £ | 8.1 | £ | (0.2 | ) | (2.5 | )% | £ | 8.1 | £ | 8.4 | £ | (0.3 | ) | (3.6 | )% | ||||||||||||||
| Retail Solutions Long term license amortization (£’m) | £ | 965.7 | £ | 599.7 | £ | 366.0 | 61.0 | % | £ | 1,933.9 | £ | 1,064.2 | £ | 869.7 | 81.7 | % | ||||||||||||||||
| Number of Machine sales | 795 | 538 | 257 | 47.8 | % | 1,314 | 851 | 463 | 54.4 | % | ||||||||||||||||||||||
| Average selling price per terminal | £ | 5,523 | £ | 7,787 | £ | (2,264 | ) | (29.1 | )% | £ | 5,323 | £ | 6,990 | £ | (1,667 | ) | (23.8 | )% | ||||||||||||||
| Total Holiday Parks Revenue (£’m) | £ | - | £ | 11.0 | £ | (11.0 | ) | (100.0 | )% | £ | - | £ | 14.0 | £ | (14.0 | ) | (100.0 | )% | ||||||||||||||
| (1) | Includes all SBG terminals in which the Company takes a participation revenue share across all territories. |
| (2) | Includes approximately 2,500 lottery terminals where the revenue share is on handle instead of net win. |
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In the table above:
“End of Period Installed Base” represent the number of gaming machines installed (excluding Holiday Park machines) that are Category B and Category C only (UK Gambling Act 2005 places machines into categories dependent on maximum stake and prize available), This is equal to the number of deployed Retail Solutions terminals at the end of each period that have been placed on a participation or fixed rental basis. Retail Solutions participation revenue, which comprises the majority of Retail Solutions service revenue, is directly related to the participation terminal installed base. This is the medium by which our customers generate revenue and pay a revenue share to the Company. To the extent all other KPIs and certain other factors remain constant, the larger the installed base, the higher the Company’s revenue would be for a given period. Management gives careful consideration to this KPI in terms of driving growth across the segment. This does not include Service Only terminals.
Revenue is derived from the performance of the installed base as described by the Gross and Net Win KPIs.
If the End of Period Installed Base is materially different from the Average Installed Base (described below), we believe this gives an indication as to potential future performance. We believe the End of Period Installed Base is particularly useful for assessing new customers or markets, to indicate the progress being made with respect to entering new territories or jurisdictions.
“Total Retail Solutions - Average Installed Base” is the average number of deployed Retail Solutions terminals during the period consisting of both participation terminals and fixed rental terminals. Therefore, it is more closely aligned to revenue in the period. We believe this measure is particularly useful for assessing existing customers or markets to provide comparisons of historical size and performance. This does not include Service Only terminals.
“Participation - Average Installed Base” is the average number of deployed Retail Solutions terminals that generated revenue on a participation basis.
“Fixed Rental - Average Installed Base” is the average number of deployed Retail Solutions terminals that generated revenue on a fixed rental basis.
“Service Only - Average Installed Base” is the average number of terminals that generated revenue on a Service only basis.
“Customer Gross Win per unit per day” is a KPI used by our management to (i) assess impact on the Company’s revenue, (ii) determine changes in the performance of the overall market and (iii) evaluate the impact of regulatory change and our new content releases on our customers. Customer Gross Win per unit per day is the average per unit cash generated across all Gaming terminals in which the Company takes a participation revenue share across all territories in the period, defined as the difference between the amounts staked less winnings to players divided by the Average Installed Base in the period, then divided by the number of days in the period.
Retail Solutions revenue accrued in the period is derived from Customer Gross Win accrued in the period after deducting gaming taxes (defined as a regulatory levy paid by the Customer to government bodies) and applying the Company’s contractual revenue share percentage.
Our management believes Customer Gross Win measures are meaningful because they represent a view of customer operating performance that is unaffected by our revenue share percentage and allow management to (1) readily view operating trends, (2) perform analytical comparisons and benchmarking between customers and (3) identify strategies to improve operating performance in the different markets in which we operate.
“Customer Net Win per unit per day” is Customer Gross Win per unit per day after giving effect to the deduction of gaming taxes.
“Inspired Blended Participation Rate” is the Company’s average revenue share percentage across all participation terminals where revenue is earned on a participation basis, weighted by Customer Net Win per unit per day.
“Inspired Fixed Rental Revenue per Gaming Machine per week” is the Company’s average fixed rental amount across all fixed rental terminals where revenue is generated on a fixed fee basis, per unit per week.
“Inspired Service Rental Revenue per Retail Solutions Machine per week” is the Company’s average service rental amount across all service only rental terminals where revenue is generated on a service only fixed fee basis, per unit per week.
“Retail Solutions Long term license amortization” is the upfront license fee per terminal which is typically spread over the life of the terminal.
Our overall Retail Solutions revenue from terminals placed on a participation basis can therefore be calculated as the product of the Participation - Average Installed Base, the Customer Net Win per unit per day, the number of days in the period, and the Inspired Blended Participation Rate, which is equal to “Participation Revenue”.
“Number of Machine sales” is the number of terminals sold during the period.
“Average selling price per terminal” is the total revenue in GBP of the Retail Solutions terminals sold divided by the “number of Machine sales”.
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Retail Solutions, Recurring Revenue
Set forth below is a breakdown of our Retail Solutions recurring revenue. Retail Solutions recurring revenue principally consists of Retail Solutions participation revenue and fixed rental revenue.
For the Three-Month Period ended | Variance | For the Six-Month Period ended | Variance | |||||||||||||||||||||||||||||
| June 30, | June 30, | 2026 vs 2025 | June 30, | June 30, | 2026 vs 2025 | |||||||||||||||||||||||||||
| (In £ millions) | 2026 | 2025 | % | 2026 | 2025 | % | ||||||||||||||||||||||||||
| Retail Solutions Recurring Revenue | ||||||||||||||||||||||||||||||||
| Total Retail Solutions Revenue | £ | 27.0 | £ | 43.1 | £ | (16.1 | ) | (37 | )% | £ | 50.6 | £ | 74.5 | £ | (23.9 | ) | (32 | )% | ||||||||||||||
| Retail Solutions Participation Revenue | £ | 12.8 | £ | 13.5 | £ | (0.7 | ) | (5 | )% | £ | 25.4 | £ | 26.8 | £ | (1.4 | ) | (5 | )% | ||||||||||||||
| Retail Solutions Project Recurring Revenue | £ | 6.9 | £ | 11.1 | £ | (4.2 | ) | (38 | )% | £ | 13.7 | £ | 21.3 | £ | (7.6 | ) | (36 | )% | ||||||||||||||
| Other Fixed Fee Recurring Revenue | £ | 0.2 | £ | 0.7 | £ | (0.5 | ) | (71 | )% | £ | 0.3 | £ | 0.9 | £ | (0.6 | ) | (67 | )% | ||||||||||||||
| Retail Solutions Long-term license amortization | £ | 1.0 | £ | 0.6 | £ | 0.4 | 67 | % | £ | 1.9 | £ | 1.1 | £ | 0.8 | 73 | % | ||||||||||||||||
| Retail Solutions Holiday Parks Recurring Revenue | £ | - | 11.0 | £ | (11.0 | ) | (100 | )% | £ | - | £ | 14.0 | £ | (14.0 | ) | (100 | )% | |||||||||||||||
| Total Retail Solutions Recurring Revenue | £ | 20.9 | £ | 36.9 | £ | (16.0 | ) | (43 | )% | £ | 41.3 | £ | 64.1 | £ | (22.8 | ) | (36 | )% | ||||||||||||||
| Retail Solutions Recurring Revenue as a % of Total Retail Solutions Revenue | 77 | % | 86 | % | (9 | )% | 82 | % | 86 | % | (4 | )% | ||||||||||||||||||||
In the table above:
“Retail Solutions Participation Revenue” includes our share of revenue generated from (i) our Retail Solutions terminals placed in gaming and lottery venues; and (ii) licensing of our game content and intellectual property to third parties.
“Retail Solutions Other Fixed Fee Recurring Revenue” includes service revenue in which the Company earns a periodic fixed fee on a contracted basis.
“Retail Solutions Project Recurring Revenue” relates specifically to a single customer for machine estate upgrades and distribution.
“Retail Solutions Long term license amortization” – see the definition provided above.
“Total Retail Solutions Recurring Revenue” is equal to Gaming Participation Revenue plus Gaming Other Fixed Fee Recurring Revenue.
Retail Solutions, Service Revenue by Region
Set forth below is a breakdown of our Retail Solutions service revenue by geographic region. Retail Solutions service revenue consists principally of Retail Solutions participation revenue, Retail Solutions other fixed fee revenue, Retail Solutions long-term license amortization and Retail Solutions other non-recurring revenue. See “Retail Solutions Segment Revenue” below for a discussion of Retail Solutions service revenue between the periods under review.
| For the Three-Month | For the Six-Month | |||||||||||||||||||||||||||||||||||||||
| Period ended | Variance | Period ended | Variance | |||||||||||||||||||||||||||||||||||||
| (In millions) | June 30, 2026 | June 30, 2025 | 2026 vs 2025 | Total Functional Currency % | June 30, 2026 | June 30, 2025 | 2026 vs 2025 | Total Functional Currency % | ||||||||||||||||||||||||||||||||
| Service Revenue: | ||||||||||||||||||||||||||||||||||||||||
| UK LBO | $ | 11.8 | $ | 12.1 | (0.3 | ) | (2 | )% | (3 | )% | $ | 23.7 | $ | 22.0 | $ | 1.7 | 8 | % | 4 | % | ||||||||||||||||||||
| UK Holiday Parks | - | 14.7 | (14.7 | ) | (100 | )% | (100 | )% | - | 18.4 | (18.4 | ) | (100 | )% | (100 | )% | ||||||||||||||||||||||||
| UK Other | 10.1 | 17.8 | (7.7 | ) | (43 | )% | (44 | )% | 19.7 | 33.9 | (14.2 | ) | (42 | )% | 2 | % | ||||||||||||||||||||||||
| Italy | 0.4 | 0.4 | - | - | 4 | % | 0.8 | 0.7 | 0.1 | 14 | % | 4 | % | |||||||||||||||||||||||||||
| Greece | 4.7 | 4.6 | 0.1 | 2 | % | 4 | % | 9.6 | 9.2 | 0.4 | 4 | % | 4 | % | ||||||||||||||||||||||||||
| Rest of the World | 1.3 | - | 1.3 | 100 | % | 100 | % | 1.3 | 0.3 | 1.0 | 333 | % | 11 | % | ||||||||||||||||||||||||||
| Lotteries | 1.4 | 1.4 | - | - | (2 | )% | 2.5 | 2.7 | (0.2 | ) | 7 | % | 3 | % | ||||||||||||||||||||||||||
| Total Service revenue | $ | 29.7 | $ | 51.0 | $ | (21.3 | ) | (42 | )% | (42 | )% | $ | 57.6 | $ | 87.2 | $ | 29.6 | 34 | % | 2 | % | |||||||||||||||||||
| Exchange Rate - $ to £ | 1.34 | 1.34 | 1.34 | 1.30 | ||||||||||||||||||||||||||||||||||||
Note: Exchange rate in the table is calculated by dividing the USD total service revenue by the GBP total service revenue, therefore this could be slightly different from the average rate during the period depending on timing of transactions.
| 28 |
Retail Solutions, Results of Operations
| For the Three-Month | Variance | For the Six-Month | Variance | |||||||||||||||||||||||||||||||||||||||||||||
| Period ended | 2026 vs 2025 | Period ended | 2026 vs 2025 | |||||||||||||||||||||||||||||||||||||||||||||
| (In millions) | June 30, 2026 | June 30, 2025 | Variance Attributable to Currency Movement | Variance on a Functional currency basis | Total Functional Currency Variance % | Total Reported Variance % | June 30, 2026 | June 30, 2025 | Variance Attributable to Currency Movement | Variance on a Functional currency basis | Total Functional Currency Variance % | Total Reported Variance % | ||||||||||||||||||||||||||||||||||||
| Revenue: | ||||||||||||||||||||||||||||||||||||||||||||||||
| Service | $ | 29.7 | $ | 51.0 | $ | 0.2 | $ | (21.5 | ) | (42 | )% | (42 | )% | $ | 57.6 | $ | 87.2 | $ | 1.8 | $ | (31.4 | ) | (36 | )% | (34 | )% | ||||||||||||||||||||||
| Product | 6.5 | 6.5 | - | - | - | - | 10.4 | 9.9 | 0.2 | 0.3 | 3 | % | 5 | % | ||||||||||||||||||||||||||||||||||
| Total revenue | 36.2 | 57.5 | 0.2 | (21.5 | ) | (37 | )% | (37 | )% | 68.0 | 97.1 | 2.0 | (31.1 | ) | (32 | )% | (30 | )% | ||||||||||||||||||||||||||||||
| Cost of Sales, excluding depreciation and amortization: | ||||||||||||||||||||||||||||||||||||||||||||||||
| Cost of Service | (7.3 | ) | (19.7 | ) | 0.1 | 12.3 | (62 | )% | (63 | )% | (14.6 | ) | (33.6 | ) | (0.1 | ) | 19.1 | (57 | )% | (57 | )% | |||||||||||||||||||||||||||
| Cost of Product | (3.5 | ) | (4.0 | ) | - | 0.5 | (13 | )% | (13 | )% | (6.1 | ) | (6.9 | ) | (0.2 | ) | 1.0 | (14 | )% | (12 | )% | |||||||||||||||||||||||||||
| Total cost of sales | (10.8 | ) | (23.7 | ) | 0.1 | 12.8 | (54 | )% | (54 | )% | (20.7 | ) | (40.5 | ) | (0.3 | ) | 20.1 | (50 | )% | (49 | )% | |||||||||||||||||||||||||||
| Staff-related selling, general and administrative expenses | (4.8 | ) | (8.7 | ) | (0.2 | ) | 4.1 | (47 | )% | (45 | )% | (9.3 | ) | (16.1 | ) | (0.7 | ) | 7.5 | (47 | )% | (42 | )% | ||||||||||||||||||||||||||
| Non-staff related selling, general and administrative expenses | (3.3 | ) | (6.5 | ) | 0.1 | 3.1 | (48 | )% | (49 | )% | (7.7 | ) | (12.9 | ) | (0.3 | ) | 5.5 | (43 | )% | (40 | )% | |||||||||||||||||||||||||||
| Labor costs capitalized | 1.1 | 1.9 | - | (0.8 | ) | (42 | )% | (42 | )% | 2.4 | 3.9 | 0.1 | (1.6 | ) | (41 | )% | (38 | )% | ||||||||||||||||||||||||||||||
| Other segment items: | ||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | (0.2 | ) | (0.5 | ) | - | 0.3 | (60 | )% | (60 | )% | (0.4 | ) | (0.8 | ) | - | 0.4 | (50 | )% | (50 | )% | ||||||||||||||||||||||||||||
| Depreciation and amortization | (9.7 | ) | (10.9 | ) | (0.1 | ) | 1.3 | (12 | )% | (11 | )% | (18.1 | ) | (18.8 | ) | (0.6 | ) | 1.3 | (7 | )% | (4 | )% | ||||||||||||||||||||||||||
| Other selling, general and administrative expenses | (0.8 | ) | (0.4 | ) | - | (0.4 | ) | 100 | % | 100 | % | (1.1 | ) | (0.6 | ) | - | (0.5 | ) | 83 | % | 83 | % | ||||||||||||||||||||||||||
| Net operating Income | $ | 7.7 | $ | 8.7 | $ | 0.1 | $ | (1.1 | ) | (13 | )% | (11 | )% | $ | 13.1 | $ | 11.3 | $ | 0.2 | $ | 1.6 | 14 | % | 16 | % | |||||||||||||||||||||||
| Exchange Rate - $ to £ | 1.34 | 1.34 | 1.34 | 1.30 | ||||||||||||||||||||||||||||||||||||||||||||
Note: Exchange rate in the table is calculated by dividing the USD total revenue by the GBP total revenue, therefore this could be slightly different from the average rate during the period depending on timing of transactions.
All variances discussed in the Retail Solutions results below are on a functional currency (at constant rate) basis, which excludes the impact of any changes in foreign currency exchange rates.
| 29 |
Retail Solutions Operating / Net Income
Net income for the three-month period ended June 30, 2026, decreased by $1.1 million, compared to the three-month period ended June 30, 2025, and net income for the six-month period ended June 30, 2026, increased by $1.6 million, compared to the six-month period ended June 30, 2025, primarily driven by the sales of the UK holiday parks business and certain associated leisure assets, and the pub operator model restructuring.
Virtual Sports
We generate revenue from our Virtual Sports segment through the provision of our products to customers for deployment both on-premise in licensed gaming venues and online through customers’ websites and mobile applications across multiple regulated jurisdiction. We primarily receive fees on a participation basis. Our participation contracts are typically structured to pay us a percentage of net win (defined as net revenue to our operator customers, after deducting player winnings, free bets or plays and other promotional costs and any relevant applicable gaming taxes) from Virtual Sports content placed on our customers’ websites or in our customers’ facilities. Typically, we recognize revenue from these arrangements on a daily basis over the term of the contract.
Revenue growth for our Virtual Sports segment is principally driven by the number of customers we have, the number of jurisdictions across which they operate, the net win performance of the games and the net win percentage that we receive pursuant to our contracts with our customers.
Virtual Sports, Key Performance Indicators
For the Three-Month Period ended | Variance | For the Six-Month Period ended | Variance | |||||||||||||||||||||||||||||
| June 30, | June 30, | 2026 vs 2025 | June 30, | June 30, | 2026 vs 2025 | |||||||||||||||||||||||||||
| 2026 | 2025 | % | 2026 | 2025 | % | |||||||||||||||||||||||||||
| Virtual Sports | ||||||||||||||||||||||||||||||||
| No. of Live Customers at the end of the period | 59 | 59 | - | - | 59 | 59 | - | - | ||||||||||||||||||||||||
| Average No. of Live Customers | 59 | 58 | 1 | 1.7 | % | 60 | 58 | 2 | 3.4 | % | ||||||||||||||||||||||
| Total Revenue (£’m) | £ | 6.6 | £ | 6.9 | £ | (0.3 | ) | (4.3 | )% | £ | 13.1 | £ | 13.9 | £ | (0.8 | ) | (5.8 | )% | ||||||||||||||
| Total Revenue £’m - Retail | £ | 2.2 | £ | 2.3 | £ | (0.1 | ) | (4.3 | )% | £ | 4.3 | £ | 4.4 | £ | (0.1 | ) | (2.3 | )% | ||||||||||||||
| Total Revenue £’m - Online Virtuals | £ | 4.4 | £ | 4.6 | £ | (0.2 | ) | (4.3 | )% | £ | 8.8 | £ | 9.4 | £ | (0.6 | ) | (6.4 | )% | ||||||||||||||
In the table above:
“No. of Live Customers at the end of the period” and “Average No. of Live Customers” represent the number of customers from which there is Virtual Sports revenue at the end of the period and the average number of customers from which there is Virtual Sports revenue during the period, respectively.
“Total Revenue (£m)” represents total revenue for the Virtual Sports segment, including recurring and upfront service revenue. Total revenue is also divided between “Total Revenue (£m) – Retail,” which consists of revenue earned through players wagering at Virtual Sports venues, “Total Revenue (£m) – Online Virtuals,” which consists of revenue earned through players wagering on Virtual Sports online.
Virtual Sports, Recurring Revenue
Set forth below is a breakdown of our Virtual Sports recurring revenue, which consists of Retail Virtuals and Online Virtuals recurring revenue as well as long-term license amortization. See “Virtual Sports Segment Revenue” below for a discussion of Virtual Sports service revenue between the periods under review.
For the Three-Month Period ended | Variance | For the Six-Month Period ended | Variance | |||||||||||||||||||||||||||||
| June 30, | June 30, | 2026 vs 2025 | June 30, | June 30, | 2026 vs 2025 | |||||||||||||||||||||||||||
| (In £ millions) | 2026 | 2025 | % | 2026 | 2025 | % | ||||||||||||||||||||||||||
| Virtual Sports Recurring Revenue | ||||||||||||||||||||||||||||||||
| Total Virtual Sports Revenue | £ | 6.6 | £ | 6.9 | £ | (0.3 | ) | (4 | )% | £ | 13.1 | £ | 13.8 | £ | (0.7 | ) | (5 | )% | ||||||||||||||
| Recurring Revenue - Retail Virtuals | £ | 2.0 | £ | 2.1 | £ | (0.1 | ) | (5 | )% | £ | 3.9 | £ | 4.1 | £ | (0.2 | ) | (5 | )% | ||||||||||||||
| Recurring Revenue - Online Virtuals | £ | 4.3 | £ | 4.5 | £ | (0.2 | ) | (4 | )% | £ | 8.6 | £ | 9.1 | £ | (0.5 | ) | (5 | )% | ||||||||||||||
| Total Virtual Sports Long-term license amortization | £ | 0.2 | £ | 0.3 | £ | (0.1 | ) | (33 | )% | £ | 0.4 | £ | 0.5 | £ | (0.1 | ) | (20 | )% | ||||||||||||||
| Total Virtual Sports Recurring Revenue | £ | 6.5 | £ | 6.9 | £ | (0.4 | ) | (6 | )% | £ | 12.9 | £ | 13.7 | £ | (0.8 | ) | (6 | )% | ||||||||||||||
| Virtual Sports Recurring Revenue as a Percentage of Total Virtual Sports Revenue | 98 | % | 100 | % | 98 | % | 99 | % | ||||||||||||||||||||||||
“Recurring Revenue” includes our share of revenue generated from (i) our Virtual Sports products placed with operators; (ii) licensing our game content and intellectual property to third parties; and (iii) our games on third-party online gaming platforms that are interoperable with our game servers.
“Virtual Sports Long term license amortization” is the upfront license fee which is typically spread over the life of the contract.
| 30 |
Virtual Sports, Results of Operations
| For the Three-Month | Variance | For the Six-Month | Variance | |||||||||||||||||||||||||||||||||||||||||||||
| Period ended | 2026 vs 2025 | Period ended | 2026 vs 2025 | |||||||||||||||||||||||||||||||||||||||||||||
| (In millions) | June 30, 2026 | June 30, 2025 | Variance Attributable to Currency Movement | Variance on a Functional currency basis | Total Functional Currency Variance % | Total Reported Variance % | June 30, 2026 | June 30, 2025 | Variance Attributable to Currency Movement | Variance on a Functional currency basis | Total Functional Currency Variance % | Total Reported Variance % | ||||||||||||||||||||||||||||||||||||
| Service Revenue | $ | 8.9 | $ | 9.2 | $ | 0.1 | $ | (0.4 | ) | (4 | )% | (3 | )% | $ | 17.6 | $ | 17.9 | $ | 0.7 | $ | (1.0 | ) | (6 | )% | (2 | )% | ||||||||||||||||||||||
| Cost of Service | (0.6 | ) | (0.7 | ) | (0.1 | ) | 0.2 | (29 | )% | (14 | )% | (1.1 | ) | (1.2 | ) | (0.1 | ) | 0.2 | (17 | )% | (8 | )% | ||||||||||||||||||||||||||
| Staff-related selling, general and administrative expenses | (2.2 | ) | (2.4 | ) | 0.1 | 0.1 | (4 | )% | (8 | )% | (4.4 | ) | (4.6 | ) | (0.1 | ) | 0.3 | (7 | )% | (4 | )% | |||||||||||||||||||||||||||
| Non-staff related selling, general and administrative expenses | (0.1 | ) | (0.5 | ) | - | 0.4 | (80 | )% | (80 | )% | (0.6 | ) | (1.1 | ) | (0.1 | ) | 0.6 | (55 | )% | (45 | )% | |||||||||||||||||||||||||||
| Labor costs capitalized | 0.7 | 1.0 | - | (0.3 | ) | 30 | % | 30 | % | 1.3 | 1.9 | 0.1 | (0.7 | ) | (37 | )% | (32 | )% | ||||||||||||||||||||||||||||||
| Other segment items: | ||||||||||||||||||||||||||||||||||||||||||||||||
| Staff-related selling, general and administrative expenses | ||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | (0.1 | ) | (0.1 | ) | - | - | - | - | (0.3 | ) | (0.2 | ) | - | (0.1 | ) | 50 | % | 50 | % | |||||||||||||||||||||||||||||
| Depreciation and amortization | (2.7 | ) | (1.9 | ) | (0.1 | ) | (0.7 | ) | 37 | % | 42 | % | (4.8 | ) | (3.2 | ) | (0.1 | ) | (1.5 | ) | 47 | % | 50 | % | ||||||||||||||||||||||||
| Net operating Income | $ | 3.9 | $ | 4.6 | $ | - | $ | (0.7 | ) | (15 | )% | (15 | )% | $ | 7.7 | $ | 9.5 | $ | 0.4 | $ | (2.2 | ) | (23 | )% | (19 | )% | ||||||||||||||||||||||
| Exchange Rate - $ to £ | 1.34 | 1.34 | 1.34 | 1.30 | ||||||||||||||||||||||||||||||||||||||||||||
Note: Exchange rate in the table is calculated by dividing the USD service revenue by the GBP service revenue, therefore this could be slightly different from the average rate during the period depending on timing of transactions.
All variances discussed in the Virtual Sports results below are on a functional currency (at constant rate) basis, which excludes the impact of any changes in foreign currency exchange rates.
Virtual Sports Revenue
During the three- and six-month periods ended June 30, 2026, revenue decreased by $0.4 million and $1.0 million, or 4% and 6%, respectively compared to the three- and six-month periods ended June 30, 2025 primarily driven by lower revenue from a key customer, partially offset by increased revenue from other customers.
Virtual Sports Operating income
During the three-month period ended June 30, 2026, operating income decreased by $0.7 million compared to the three-month period ended June 30, 2025, primarily due to an increase in depreciation and amortization of $0.7 million and a decrease in gross margin of $0.2 million, partially offset by a reduction in non-staff related selling, general and administrative expenses of $0.4 million.
During the six-month period ended June 30, 2026, operating income decreased by $2.2 million compared to the six-month period ended June 30, 2025, mainly due to an increase in depreciation and amortization of $1.5 million and a decrease in gross margin of $0.8 million, partially offset by a reduction in non-staff related selling, general and administrative expenses of $0.6 million.
| 31 |
Interactive
We generate revenue from our Interactive segment through the Remote Gaming Server (“RGS”) enabling bespoke or general game content either via third party aggregation platforms, or directly on the customers gaming platform. Typically, we receive fees on a participation basis. Our participation contracts are usually structured to pay us a percentage of net win (defined as net revenue to our operator customers, after deducting player winnings, free bets or plays and other promotional costs and any relevant regulatory levies) from Interactive content placed on our customers’ websites. Typically, we recognize revenue from these arrangements on a daily basis over the term of the contract.
Revenue growth for our Interactive segment is principally driven by the number of customers we have, the number of live games, the net win performance of the games and the net win percentage that we receive pursuant to our contracts with our customers.
Interactive, Key Performance Indicators
| For the Three-Month Period ended | Variance | For the Six-Month Period ended | Variance | |||||||||||||||||||||||||||||
| June 30, | June 30, | 2026 vs 2025 | June 30, | June 30, | 2026 vs 2025 | |||||||||||||||||||||||||||
| 2026 | 2025 | % | 2026 | 2025 | % | |||||||||||||||||||||||||||
| Interactive | ||||||||||||||||||||||||||||||||
| No. of Live Customers at the end of the period | 219 | 196 | 23 | 11.7 | % | 219 | 196 | 23 | 11.7 | % | ||||||||||||||||||||||
| Average No. of Live Customers | 214 | 194 | 20 | 10.3 | % | 214 | 189 | 25 | 13.2 | % | ||||||||||||||||||||||
| No. of Games available at the end of the period | 359 | 320 | 39 | 12.2 | % | 359 | 320 | 39 | 12.2 | % | ||||||||||||||||||||||
| Average No. of Games available | 357 | 318 | 39 | 12.3 | % | 351 | 321 | 30 | 9.3 | % | ||||||||||||||||||||||
| No. of Live Games at the end of the period | 336 | 296 | 40 | 13.5 | % | 336 | 296 | 40 | 13.5 | % | ||||||||||||||||||||||
| Average No. of Live Games | 334 | 294 | 40 | 13.6 | % | 328 | 297 | 31 | 10.4 | % | ||||||||||||||||||||||
| Total Revenue (£’m) | £ | 11.6 | £ | 10.1 | £ | 1.5 | 14.9 | % | £ | 24.1 | £ | 19.7 | £ | 4.4 | 22.3 | % | ||||||||||||||||
In the table above:
“No. of Live Customers at the end of the period” and “Average No. of Live Customers” represent the number of customers from which there is Interactive revenue at the end of the period and the average number of customers from which there is Interactive revenue during the period, respectively.
“No. of Games available at the end of the period” and “Average No. of Games available” represents the number of games that are available for operators to deploy at the end of the period (including inactive legacy games still available and inactive new games that are available but have not yet gone live with any operators) and the average number of games that are available for operators to deploy during the period, respectively. This incorporates both live games and inactive games.
“No. of Live Games at the end of the period” and “Average No. of Live Games” represents the number of games from which there is Interactive revenue at the end of the period and the average number of games from which there is Interactive revenue during the period, respectively.
“Total Revenue (£m)” represents total revenue for the Interactive segment, including recurring and upfront service revenue.
| 32 |
Interactive, Results of Operations
For the Three-Month | Variance | For the Six-Month | Variance | |||||||||||||||||||||||||||||||||||||||||||||
| Period ended | 2026 vs 2025 | Period ended | 2026 vs 2025 | |||||||||||||||||||||||||||||||||||||||||||||
| (In millions) | June 30, 2026 | June 30, 2025 | Variance Attributable to Currency Movement | Variance on a Functional currency basis | Total Functional Currency Variance % | Total Reported Variance % | June 30, 2026 | June 30, 2025 | Variance Attributable to Currency Movement | Variance on a Functional currency basis | Total Functional Currency Variance % | Total Reported Variance % | ||||||||||||||||||||||||||||||||||||
| Service Revenue | $ | 15.7 | $ | 13.6 | $ | 0.1 | $ | 2.0 | 15 | % | 15 | % | $ | 32.4 | $ | 25.7 | $ | 1.2 | $ | 5.5 | 21 | % | 26 | % | ||||||||||||||||||||||||
| Cost of Service | (0.8 | ) | (0.8 | ) | - | - | - | - | (1.6 | ) | (1.4 | ) | (0.1 | ) | (0.1 | ) | 7 | % | 14 | % | ||||||||||||||||||||||||||||
| Staff-related selling, general and administrative expenses | (3.4 | ) | (3.0 | ) | - | (0.4 | ) | 13 | % | 13 | % | (6.2 | ) | (5.4 | ) | (0.2 | ) | (0.6 | ) | 11 | % | 15 | % | |||||||||||||||||||||||||
| Non-staff related selling, general and administrative expenses | (2.0 | ) | (1.6 | ) | (0.1 | ) | (0.3 | ) | 19 | % | 25 | % | (4.2 | ) | (3.6 | ) | (0.2 | ) | (0.4 | ) | 11 | % | 17 | % | ||||||||||||||||||||||||
| Labor costs capitalized | 0.8 | 0.9 | - | (0.1 | ) | (11 | )% | (11 | )% | 1.7 | 1.5 | 0.1 | 0.1 | 7 | % | 13 | % | |||||||||||||||||||||||||||||||
| Other segment items: | ||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | (0.2 | ) | (0.2 | ) | - | - | - | - | (0.3 | ) | (0.3 | ) | - | - | - | - | ||||||||||||||||||||||||||||||||
| Depreciation and amortization | (2.0 | ) | (1.6 | ) | (0.1 | ) | (0.3 | ) | 19 | % | 25 | % | (3.0 | ) | (2.3 | ) | (0.1 | ) | (0.6 | ) | 26 | % | 30 | % | ||||||||||||||||||||||||
| Net operating Income | $ | 8.1 | $ | 7.3 | $ | (0.1 | ) | $ | 0.9 | 12 | % | 11 | % | $ | 18.8 | $ | 14.2 | $ | 0.7 | $ | 3.9 | 27 | % | 32 | % | |||||||||||||||||||||||
| Exchange Rate - $ to £ | 1.34 | 1.34 | 1.34 | 1.30 | ||||||||||||||||||||||||||||||||||||||||||||
Note: Exchange rate in the table is calculated by dividing the USD service revenue by the GBP service revenue, therefore this could be slightly different from the average rate during the period depending on timing of transactions.
All variances discussed in the Interactive results below are on a functional currency (at constant rate) basis, which excludes the impact of any changes in foreign currency exchange rates.
Interactive Revenue
During three- and six-month periods ended June 30, 2026, revenue increased by $2.0 million and $5.5 million, or 15% and 21%, respectively, compared to the three- and six-month periods ended June 30, 2025 mainly driven by recurring revenue growth in the UK, mainland Europe and North America. UK revenue growth was partially offset by higher UK remote gaming taxes.
Interactive Net Operating Income
Operating income for the three-month period ended June 30, 2026 increased by $0.9 million, compared to the three-month period ended June 30, 2025. This increase was driven by the increase in revenue, partially offset by increases in staff and non-staff related selling, general and administrative expenses of $0.7 million and depreciation and amortization of $0.3 million.
For the six-month period ended June 30, 2026, compared to the six-month period ended June 30, 2025, operating income increased by $3.9 million driven by the increase in gross margin of $5.4 million, partially offset by increases in Staff and non-staff related selling, general and administrative expenses of $10.0 million and depreciation and amortization of $0.6 million, incurred to support the revenue growth.
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Non-GAAP Financial Measures
We use certain non-GAAP financial measures, including EBITDA, to analyze our operating performance. We use these financial measures to manage our business on a day-to-day basis. We believe that these measures are also commonly used in our industry to measure performance. For these reasons, we believe that these non-GAAP financial measures provide expanded insight into our business, in addition to standard U.S. GAAP financial measures. There are no specific rules or regulations for defining and using non-GAAP financial measures, and as a result the measures we use may not be comparable to measures used by other companies, even if they have similar labels. The presentation of non-GAAP financial information should not be considered in isolation from, or as a substitute for, or superior to, financial information prepared and presented in accordance with U.S. GAAP. You should consider our non-GAAP financial measures in conjunction with our U.S. GAAP financial measures.
We define our non-GAAP financial measures as follows:
EBITDA is defined as net income (loss) excluding depreciation and amortization, interest expense, interest income and income tax expense.
Adjusted EBITDA is defined as net income (loss) excluding depreciation and amortization, interest expense, interest income and income tax expense, and other additional exclusions and adjustments (see Adjusted EBITDA reconciliation table). Such additional excluded amounts include stock-based compensation U.S. GAAP charges where the associated liability is expected to be settled in stock, and changes in the value of earnout liabilities and income and expenditure in relation to legacy portions of the business (being those portions where trading no longer occurs) including closed defined benefit pension schemes. Additional adjustments are made for items considered outside the normal course of business, including but not limited to (1) restructuring costs, which include charges attributable to employee severance, impairments, management changes, restructuring, dual running costs, costs related to facility closures and integration costs, (2) merger and acquisition costs and (3) gains or losses not in the ordinary course of business (4) the costs of the restatement of previously issued financial statements.
We believe Adjusted EBITDA, when considered along with other performance measures, is a particularly useful performance measure, because it focuses on certain operating drivers of the business, including sales growth, operating costs, selling and administrative expense and other operating income and expense. We believe Adjusted EBITDA can provide a more complete understanding of our operating results and the trends to which we are subject, and an enhanced overall understanding of our financial performance and prospects for the future. Adjusted EBITDA is not intended to be a measure of liquidity or cash flows from operations or a measure comparable to net income or loss, because it does not take into account certain aspects of our operating performance (for example, it excludes non-recurring gains and losses which are not deemed to be a normal part of underlying business activities). Our use of Adjusted EBITDA may not be comparable to the use by other companies of similarly termed measures. Management compensates for these limitations by using Adjusted EBITDA as only one of several measures for evaluating our operating performance. In addition, capital expenditures, which affect depreciation and amortization, interest expense, and income tax benefit (expense), are evaluated separately by management.
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Adjusted Revenue (Revenue Excluding Low Margin Gaming Hardware Sales) is defined as revenue excluding Gaming hardware sales that are sold at Low Margin with the intention of securing longer term recurring revenue streams.
Functional Currency at Constant rate. Currency impacts discussed have been calculated as the current-period average GBP: USD rate less the equivalent average rate in the prior period, multiplied by the current period amount in our functional currency (GBP). The remaining difference, referred to as functional currency at constant rate, is calculated as the difference in our functional currency, multiplied by the prior-period average GBP: USD rate, as a proxy for functional currency at constant rate movement.
Currency Movement represents the difference between the results in our reporting currency (USD) and the results on a functional currency (at constant rate) basis.
Reconciliations from net loss, as shown in our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss), to Adjusted EBITDA are shown below:
Reconciliation to Adjusted EBITDA by segment for the Three and Six Months ended June 30, 2026
| For the Three-Month Period ended | For the Six-Month Period ended | |||||||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2026 | |||||||||||||||||||||||||||||||||||||||
| (In millions) | Total | Retail Solutions | Virtual Sports | Interactive | Corporate | Total | Retail Solutions | Virtual Sports | Interactive | Corporate | ||||||||||||||||||||||||||||||
| Net Income/ (loss) | $ | 0.2 | $ | 7.7 | $ | 3.9 | $ | 8.1 | $ | (19.5 | ) | $ | (0.3 | ) | $ | 13.1 | $ | 7.7 | $ | 18.8 | $ | (39.9 | ) | |||||||||||||||||
| Pension charges (1) | 0.3 | 0.3 | 0.5 | 0.5 | ||||||||||||||||||||||||||||||||||||
| Costs of group restructure (2) | 0.8 | 0.8 | - | 1.1 | 1.1 | - | ||||||||||||||||||||||||||||||||||
| Stock-based compensation expense (4) | 1.6 | 0.2 | 0.1 | 0.2 | 1.1 | 3.0 | 0.4 | 0.3 | 0.3 | 2.0 | ||||||||||||||||||||||||||||||
| Depreciation and amortization (4) | 14.5 | 9.7 | 2.7 | 2.0 | 0.1 | 27.0 | 18.1 | 4.8 | 3.0 | 1.1 | ||||||||||||||||||||||||||||||
| Interest expense net (4) | 9.5 | 9.5 | 20.0 | 20.0 | ||||||||||||||||||||||||||||||||||||
| Other finance expenses / (income) (4) | (0.2 | ) | (0.2 | ) | (0.3 | ) | (0.3 | ) | ||||||||||||||||||||||||||||||||
| Income tax (4) | 0.4 | 0.4 | (0.3 | ) | (0.3 | ) | ||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 27.1 | $ | 18.4 | $ | 6.7 | $ | 10.3 | $ | (8.3 | ) | $ | 50.7 | $ | 32.7 | $ | 12.8 | $ | 22.1 | $ | (16.9 | ) | ||||||||||||||||||
| Adjusted EBITDA | £ | 20.1 | £ | 13.7 | £ | 5.0 | £ | 7.6 | £ | (6.2 | ) | £ | 37.8 | £ | 24.3 | £ | 9.5 | £ | 16.4 | £ | (12.4 | ) | ||||||||||||||||||
| Exchange Rate - $ to £ (5) | 1.34 | 1.34 | ||||||||||||||||||||||||||||||||||||||
Note: Certain corporate function costs have not been allocated to the Company’s reportable operating segments because to do so would not be practical; these are shown in the Corporate category.
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Reconciliation to Adjusted EBITDA by segment for the Three and Six Months ended June 30, 2025
| For the Three-Month Period ended | For the Six-Month Period ended | |||||||||||||||||||||||||||||||||||||||
| June 30, 2025 | June 30, 2025 | |||||||||||||||||||||||||||||||||||||||
| (In millions) | Total | Retail Solutions | Virtual Sports | Interactive | Corporate | Total | Retail Solutions | Virtual Sports | Interactive | Corporate | ||||||||||||||||||||||||||||||
| Net Income/ (loss) | $ | (7.8 | ) | $ | 8.7 | $ | 4.6 | $ | 7.3 | $ | (28.4 | ) | $ | (7.9 | ) | $ | 11.3 | $ | 9.5 | $ | 14.2 | $ | (42.9 | ) | ||||||||||||||||
| Pension charges (1) | 0.3 | 0.3 | 0.5 | 0.5 | ||||||||||||||||||||||||||||||||||||
| Cost of Group Restructure (2) | 3.2 | 0.4 | 2.8 | 3.7 | 0.6 | 3.1 | ||||||||||||||||||||||||||||||||||
| Costs of group restatement (3) | (0.1 | ) | (0.1 | ) | 4.0 | 4.0 | ||||||||||||||||||||||||||||||||||
| Stock-based compensation expense (4) | 1.8 | 0.5 | 0.1 | 0.2 | 1.0 | 3.2 | 0.8 | 0.2 | 0.3 | 1.9 | ||||||||||||||||||||||||||||||
| Depreciation and amortization (4) | 15.3 | 10.9 | 1.9 | 1.6 | 0.9 | 25.9 | 18.8 | 3.2 | 2.3 | 1.6 | ||||||||||||||||||||||||||||||
| Interest expense net (4) | 7.1 | 7.1 | 14.1 | 14.1 | ||||||||||||||||||||||||||||||||||||
| Other finance expenses / (income) (4) | (0.2 | ) | (0.2 | ) | (0.4 | ) | (0.4 | ) | ||||||||||||||||||||||||||||||||
| Income tax (4) | 8.8 | 8.8 | 3.7 | 3.7 | ||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 28.4 | $ | 20.5 | $ | 6.6 | $ | 9.1 | $ | (7.8 | ) | $ | 46.8 | $ | 31.5 | $ | 12.9 | $ | 16.8 | $ | (14.4 | ) | ||||||||||||||||||
| Adjusted EBITDA | £ | 21.3 | £ | 15.4 | £ | 5.0 | £ | 6.8 | £ | (5.9 | ) | £ | 35.8 | £ | 24.1 | £ | 9.9 | £ | 12.9 | £ | (11.1 | ) | ||||||||||||||||||
| Exchange Rate - $ to £ (5) | 1.34 | 1.30 | ||||||||||||||||||||||||||||||||||||||
Note: Certain corporate function costs have not been allocated to the Company’s reportable operating segments because to do so would not be practical; these are shown in the Corporate category.
Notes to Adjusted EBITDA reconciliation tables above:
| (1) | “Pension charges” are profit and loss charges included within selling, general and administrative expenses, relating to a defined benefit scheme which was closed to new entrants in 1999 and to future accrual in 2010. As well as the amortization of net loss, the figure also includes charges relating to the Pension Protection Fund (which were historically borne by the pension scheme) and a small amount of associated professional services expenses. These costs are included within Corporate Functions. |
| (2) | “Costs of Group Restructure” includes redundancy costs, Payments In Lieu of Notice costs and any associated employer taxes. To qualify as being an adjusting item, costs must be part of a large restructuring project, which will net save ongoing future costs or be in relation to the exit of an Executive. |
| (3) | “Costs of Group Restatement” includes accounting advice and other related costs associated with the restatement of financial statements. It also includes costs relating to the SEC inquiry that was concluded in January 2025. To qualify as an adjusting item, costs must be specific to the event and be neither normal nor recurring in nature. |
| (4) | Stock-based compensation expense, Depreciation and amortization, Total other expense, net and Income tax are described above in the Results of Operations line item discussions. Total expense, net includes interest income, interest expense, change in fair value of earnout liability, change in fair value of derivative liability and other finance income. |
| (5) | Exchange rate in the table is calculated by dividing the USD Adjusted EBITDA by the GBP Adjusted EBITDA, therefore this could be slightly different from the average rate during the period depending on timing of transactions. |
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Liquidity and Capital Resources
Six Months ended June 30, 2026, compared to Six Months ended June 30, 2025
| Six Months ended | Variance | |||||||||||
| June 30, | June 30, | 2026 to | ||||||||||
| (in millions) | 2026 | 2025 | 2025 | |||||||||
| Net loss | $ | (0.3 | ) | $ | (7.9 | ) | $ | 7.6 | ||||
| Amortization of debt fees | 2.0 | 1.3 | 0.7 | |||||||||
| Change in fair value of stock-based compensation expense | 3.0 | 3.2 | (0.2 | ) | ||||||||
| Deferred income taxes | - | (0.1 | ) | 0.1 | ||||||||
| Depreciation and amortization (incl right of use assets) | 28.1 | 27.5 | 0.6 | |||||||||
| Other net cash (utilized)/generated by operating activities | (3.3 | ) | 16.7 | (20.0 | ) | |||||||
| Net cash provided by operating activities | 29.5 | 40.7 | (11.2 | ) | ||||||||
| Net cash used in investing activities | (18.7 | ) | (31.2 | ) | 12.5 | |||||||
| Net cash (used)/generated by financing activities | (30.5 | ) | 4.1 | (34.6 | ) | |||||||
| Effect of exchange rates on cash | (0.4 | ) | 3.4 | (3.8 | ) | |||||||
| Net (decrease)/increase in cash and cash equivalents | $ | (20.1 | ) | $ | 17.0 | $ | (37.1 | ) | ||||
Net cash provided by operating activities
For the six months ended June 30, 2026, net cash provided by operating activities was a $29.5 million inflow, compared to a $40.7 million inflow for the six months ended June 30, 2025, representing an $11.2 million decrease in cash generation from operating activities. This decrease was driven primarily through the collection of receipts in the prior year relating to machine sales made at the end of 2024 and unfavorable timing on supplier payments.
Change in fair value of stock-based compensation expense decreased by $0.2 million to $3.0 million due to a $0.2 million reduction in the stock-based compensation expense.
Depreciation and amortization increased by $0.6 million, to $28.1 million, with increases of $2.2 million for contract costs, $0.5 million for software development amortization and $0.3 million for other intangible assets which were partly offset by a decrease of $2.2 million for machine depreciation.
Other net cash (utilized)/generated by operating activities decreased by $20.0 million, to a $3.3 million outflow. The relative movements between the six months ended June 30, 2026 and the six months ended June 30, 2025 resulted in adverse movements in accounts receivable of $15.9 million, in accounts payable and other creditors of $20.7 million and in inventory of $4.9 million. The adverse movement in accounts receivable was due to collection of receipts in the first half of 2025 from several significant machine hardware sales made at the end of 2024. The adverse movements in accounts payable were due to timing of supplier payments and the relative activity levels seen. These were partly offset by favorable movements in prepaid expenses and other assets of $21.5 million.
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Net cash used in investing activities
Net cash utilized in investing activities decreased by $12.5 million, to $18.7 million during the six months ended June 30, 2026. This was driven by lower spend on plant, property and equipment of $12.4 million and on contract costs of $1.7 million partly offset by higher capital software spend of $1.6 million.
Net cash used by financing activities
During the six months ended June 30, 2026, net cash utilized by financing activities was $30.5 million. This included discretionary spend making debt repayments of $23.3 million and repurchase of shares of $5.2 million. The remaining $2.0 million spend related to finance lease spend. During the six months ended June 30, 2025, net cash of $4.1 million was generated by financing activities due to the refinancing of the business in June 2025 which resulted in a net generation of cash of $8.2 million which was partly offset by a $4.1 million outflow relating to finance lease spend.
Funding Needs and Sources
To fund our obligations, we have historically relied on a combination of cash flows provided by operations and the incurrence of additional debt or the refinancing of existing debt. As of June 30, 2026, we had liquidity consisting of $23.2 million in cash and cash equivalents, of which $1.2 million is restricted in escrow until November 2026 and a further $24.4 million of undrawn revolver facility. This compares to $46.3 million of cash and cash equivalents as of June 30, 2025, with a further $24.4 million of revolver facilities undrawn. We had a working capital outflow of $3.3 million for the six months ended June 30, 2026, compared to a $16.7 million inflow for the six months ended June 30, 2025.
The level of our working capital surplus or deficit varies with the level of machine production we are undertaking and our capitalization as well as the seasonality evident in some of the businesses. In periods with minimal machine volumes and capital spend, our working capital is typically more stable. In periods where significant numbers of machines are being produced, the levels of inventory and creditors are typically higher and there is a natural timing difference between converting the stock into sellable or capitalized plant and settling payments to suppliers. These factors, along with movements in trading activity levels, can result in significant working capital volatility. In periods of low activity, our working capital volatility is reduced. Working capital is reviewed and managed with the aim of ensuring that current liabilities are covered by the level of cash held and the expected level of short-term receipts.
Historically, some of our business operations require cash to be held within the machines. However, with the sale of our holiday park business and certain associated leisure assets in November 2025, the operational float requirement was removed. As of June 30, 2026, none of our $23.2 million of cash was held as operational floats within the machines. At June 30, 2025, $7.2 million of our $46.3 million of cash was held as operational floats within the machines.
Management currently believes that the Company’s cash balances on hand, cash flows expected to be generated from operations, and the ability to control and defer capital projects will be sufficient to fund the Company’s net cash requirements through August 2027.
Long Term and Other Debt
| (In millions) | June 30, 2026 | June 30, 2025 | ||||||||||||||
| Cash held | £ | 17.5 | $ | 23.2 | £ | 33.8 | $ | 46.3 | ||||||||
| Revolver drawn | - | - | - | - | ||||||||||||
| Principal senior debt | (252.5 | ) | (335.1 | ) | (270.0 | ) | (370.0 | ) | ||||||||
| Cash interest accrued | (1.5 | ) | (2.0 | ) | (1.8 | ) | (2.4 | ) | ||||||||
| Finance lease creditors | (11.8 | ) | (15.7 | ) | (16.2 | ) | (22.2 | ) | ||||||||
| Total | £ | (248.3 | ) | $ | (329.6 | ) | £ | (254.2 | ) | $ | (348.3 | ) | ||||
Note: Table presented in GBP and USD as principle senior debt has a base currency of GBP, movements in the USD value represent foreign currency exchange rate fluctuations.
Debt Covenants
Under the Note Purchase Agreement in place as of June 30, 2026, we are subject to covenant testing on the Senior Notes. The Notes Purchase Agreement requires that the Company maintain a maximum consolidated senior secured net leverage ratio of 5.0x on the test date for the relevant periods ending September 30, 2025, December 31, 2025, March 31, 2026, June 30, 2026, September 30, 2026, December 31, 2026 and March 31, 2027, stepping down to 4.75x on June 30, 2027 and each relevant period thereafter (the “Notes Financial Covenant”). The Notes Financial Covenant is calculated as the ratio of consolidated senior secured net debt to consolidated pro forma EBITDA (defined as consolidated net income after adding back certain items including (without limitation) interest expense, taxes, depreciation and amortization expenses and exceptional or non-recurring costs and losses and after adjusting for certain projected savings and synergies) for the 12-month period preceding the relevant quarterly testing date and is tested quarterly on a rolling basis. The Notes Purchase Agreement does not include a minimum interest coverage ratio or other financial covenants.
The Senior Facilities Agreement also requires that the Company maintain a maximum consolidated senior secured net leverage ratio of 5.50x on the test date for the relevant periods ending September 30, 2025, December 31, 2025, March 31, 2026, June 30, 2026, September 30, 2026, December 31, 2026 and March 31, 2027, stepping down to 5.25x on June 30, 2027 and each relevant period thereafter (the “RCF Financial Covenant”). The RCF Financial Covenant is calculated as the ratio of consolidated senior secured net debt to consolidated pro forma EBITDA (defined as net loss excluding depreciation and amortization, interest expense, interest income and income tax expense) for the 12-month period preceding the relevant quarterly testing date and is tested quarterly on a rolling basis. The SFA does not include a minimum interest coverage ratio or other financial covenants.
Under the previous debt facilities, which operated up until the refinancing on June 4, 2025, we were not subject to covenant testing on the Senior Secured Notes. We were, however, subject to covenant testing at the level of Inspired Entertainment Inc., the ultimate holding company, on the previous RCF which required the Company to maintain a maximum consolidated senior secured net leverage ratio of 6.0x on March 31, 2022, stepping down to 5.75x on March 31, 2023 and 5.50x from March 31, 2024 and thereafter (the “RCF Financial Covenant”). The RCF Financial Covenant is calculated as the ratio of consolidated senior secured net debt to consolidated pro forma EBITDA (defined as net income (loss) excluding depreciation and amortization, interest expense, interest income and income tax expense) for the 12-month period preceding the relevant quarterly testing date and is tested quarterly on a rolling basis, subject to the Initial Facility (as defined in the RCF Agreement) being drawn on the relevant test date. The RCF Financial Covenant does not include a minimum interest coverage ratio or other financial covenants. These covenants have now been replaced by those of the new long term debt.
Covenant testing at June 30, 2026 showed covenant compliance with the current debt facilities in place and under the previous debt facilities, there were no covenant violations in the six-month period ended June 30, 2025.
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Liens and Encumbrances
As of June 30, 2026, our Senior Notes were secured by the imposition of a fixed and floating charge in favor of the lender over all the assets of the Company and certain of the Company’s subsidiaries.
Share Repurchases
In November 2025 the Board of Directors authorized a new share repurchase program permitting the repurchase, subject to repurchases being effected on or before November 30, 2028 of up to an aggregate amount of $25.0 million of the Company’s issued and outstanding shares of common stock. Since the authorization, the Company has repurchased an aggregate of 763,829 shares at an aggregate cost of $5.6 million. Of these repurchased amounts an aggregate of 707,225 shares at an aggregate cost of $5.2 million were repurchased during the six months ended June 30, 2026.
The Company’s prior repurchase program expired on May 10, 2025. Under the prior program the Company repurchased an aggregate of 1,193,118 shares at an aggregate cost of $12.0 million (repurchases were effected during the years 2022-2023).
Total cumulative share repurchases under both share repurchase programs amount to an aggregate of 1,956,947 shares at an aggregate cost of $17.6 million.
Contractual Obligations
As of June 30, 2026, our contractual obligations were as follows:
| Less than | More than | |||||||||||||||||||
| Contractual Obligations (in millions) | Total | 1 year | 1-2 years | 3-5 years | 5 years | |||||||||||||||
| Operating activities | ||||||||||||||||||||
| Interest on long term debt | $ | 130.5 | $ | 32.6 | $ | 32.6 | $ | 65.3 | $ | - | ||||||||||
| Purchase of machines | 14.5 | 14.5 | - | - | - | |||||||||||||||
| Financing activities | ||||||||||||||||||||
| Senior bank debt - principal repayment | 335.1 | - | - | 335.1 | - | |||||||||||||||
| Finance lease payments | 15.7 | 4.3 | 5.3 | 6.1 | - | |||||||||||||||
| Operating lease payments | 8.0 | 2.3 | 1.4 | 2.9 | 1.4 | |||||||||||||||
| Interest on non-utilization fees | 1.1 | 0.3 | 0.3 | 0.5 | - | |||||||||||||||
| Total | $ | 504.9 | $ | 54.0 | $ | 39.6 | $ | 409.9 | $ | 1.4 | ||||||||||
Off-Balance Sheet Arrangements
As of June 30, 2026, there were no off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of Regulation S-K, promulgated by the SEC.
Critical Accounting Policies and Accounting Estimates
The preparation of our audited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. We exercise considerable judgment with respect to establishing sound accounting policies and in making estimates and assumptions that affect the reported amounts of our assets and liabilities, our recognition of revenue and expenses, and our disclosure of commitments and contingencies at the date of the consolidated financial statements. On an on-going basis, we evaluate our estimates and judgments. We base our estimates and judgments on a variety of factors, including our historical experience, knowledge of our business and industry and current and expected economic conditions, that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We periodically re-evaluate our estimates and assumptions with respect to these judgments and modify our approach when circumstances indicate that modifications are necessary. While we believe that the factors we evaluate provide us with a meaningful basis for establishing and applying sound accounting policies, we cannot guarantee that the results will always be accurate. Since the determination of these estimates requires the exercise of judgment, actual results could differ from such estimates.
For a discussion of other recently issued accounting standards, and assessments as to their impacts on the Company, see Note 1 “Nature of Operations, Management’s Plans and Summary of Significant Accounting Policies” in the Notes to Consolidated Financial Statements included in Part I, Item 1 of the Company’s 2025 Form 10-K.
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Revenue
Application of GAAP related to the measurement and recognition of revenue requires us to make judgments and estimates. Specifically, complex arrangements with nonstandard terms and conditions may require significant contract interpretation to determine the appropriate accounting. The Company often enters into contracts with customers that consist of a combination of services and products that are accounted for as one or more distinct performance obligations. Management applies judgment in evaluating the contractual terms and conditions that impact the identification of performance obligations and the pattern of revenue recognition. For these arrangements that contain multiple promises, judgement is also required to determine the stand-alone selling price (“SSP”) for each distinct performance obligation. In instances where SSP is not directly observable, such as when we do not sell the product or service separately, we determine the SSP using information that may include market conditions, size of the customer, geography and other observable inputs or, as necessary, unobservable considerations such as historical experience, knowledge of our business and industry and our current or expected selling practices.
Revenue recognition is also impacted by our ability to estimate variable consideration, including, for example, estimates for income earned but unbilled prior to the reporting period end. We consider various factors when making these judgments, including a review of specific transactional data and contracted terms, information obtained subsequent to the reporting period end and historical experience. Evaluations are conducted each quarter to assess the adequacy of the estimates.
Other significant judgments include determining whether the Company is acting as the principal or the agent in a transaction.
The Company recognized service and product revenue of $107.6 million and $10.4 million, respectively, for the six months ended June 30, 2026. The Company’s revenue recognition policy, which requires significant judgments and estimates, is fully described in Note 1 “Nature of Operations, Management’s Plans and Summary of Significant Accounting Policies” in the Notes to Consolidated Financial Statements included in Part I, Item 1 of the Company’s 2025 Form 10-K.
Goodwill Impairment Assessment
Application of the goodwill impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units, and determination of the fair value of each reporting unit. Performance of the qualitative goodwill assessment requires judgment in identifying and considering the significance of relevant key factors, events and circumstances that affect the fair value or carrying amount of the reporting units. Such events and circumstances that we have considered include macroeconomic conditions, industry specific and market considerations, and reporting unit-specific factors such as overall actual and projected financial performance, among other factors. We also considered the results from the most recent date that a fair value measurement was performed as a part of a quantitative goodwill assessment and specifically the cushion between each reporting unit’s fair value and carrying value. The estimates used to calculate the fair value of a reporting unit as a part of a quantitative goodwill assessment change from year to year based on operating results, market conditions, and other factors. Changes in these estimates and assumptions could materially affect the determination of fair value and goodwill impairment, if any, for each reporting unit.
Long-lived Assets and Finite-lived Intangible Assets
We evaluate the recoverability of intangible assets and other long-lived assets with finite useful lives by comparing the carrying value of the asset group to the estimated undiscounted future cash flows that we expect the asset to generate if events or changes in circumstances indicate that these assets are not recoverable. If the asset group fails the recoverability test, an impairment loss is measured as the amount by which the carrying amount of the asset group exceeds its fair value. The fair value is determined using a discounted cash flow approach where projections of future cash flows generated by those assets are discounted using an estimated discount rate. Significant judgment is required to estimate the amount and timing of future cash flows and the relative risk of achieving those cash flows. We also make judgments about the remaining useful lives of intangible assets and other long-lived assets that have finite lives. While we believe our estimates of future operating results and projected cash flows are reasonable, any significant adverse changes in key assumptions (i.e., adverse change in the extent or manner in which an asset or asset group is being used or expectation that, more likely than not, an asset or asset group will be sold or otherwise disposed of before the end of its useful life) or adverse changes in economic and market conditions may cause a change in our evaluation of recoverability or our estimation of fair value and could result in an impairment charge that could be material to our financial statements. Any impairment loss shall be allocated to the long-lived assets of the group on a pro rata basis using the relative carrying amounts of those assets, except that the loss allocated to an individual long-lived asset of the group shall not reduce the carrying amount of that asset below its fair value.
Software Development Costs
The Company must apply judgement in determining the amount of software development costs that should be capitalized. Specifically, we must evaluate, on a project-by-project basis, whether the resultant product or platform will be completed and generate ongoing economic benefits, principally through revenue from our customers, which is subject to uncertainties.
Once the software is substantially complete or available for general release, capitalized internal-use and external-use software costs are amortized on a straight-line basis over the estimated economic useful life of the software, which ranges from two to five years. There is judgement involved in estimating the useful life of developed software and the two-to-five-year period was determined based on factors such as the continuous development in the technology, obsolescence, and anticipated life of the service offering before significant upgrades. Management evaluates the useful lives of these assets on a recurring basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Our principal market risk consists of our exposure to changes in foreign currency exchange rates.
Interest Rate Risk
Following the Company’s debt refinancing in June 2025, the Company’s external borrowings are subject to floating interest rates. Our senior notes accrue interest at a rate per annum equal to SONIA plus a margin (based on the Company’s consolidated senior secured net leverage ratio) ranging from 5.50% to 6.00% per annum fixed rate. Therefore, movements in rates such as SONIA will impact on the current borrowings with increases in SONIA leading to a higher interest charge.
In November 2025, the Company entered into two interest rate swap agreements which fix the interest rate on £250.0 million of our debt at 3.6208% plus the margin significantly limiting our exposure to interest rate variations. The full details of the interest rate swaps are fully described in Note 8 Derivatives and Hedging Activities.
As at June 30, 2026, we had £252.5 million ($335.1 million) of senior note debt subject to a floating rate interest charge that can vary with the SONIA rate. If the floating interest rates increased by 1%, the additional interest charge would have been approximately $1.8 million for the six months ended June 30, 2026. If the floating interest rates increased by 5%, the additional interest charge would have been approximately $8.8 million for the six months ended June 30, 2026. The additional interest charges are based on the full senior note debt being unhedged.
Up until the debt refinancing in June 2025, the previous external borrowings of senior notes were provided at a fixed rate. Therefore, movements in rates such as SONIA did not impact on the borrowings and the only fluctuation that was reported was solely caused by movements in the exchange rates between the Company’s functional currency and its reporting currency.
Foreign Currency Exchange Rate Risk
Our operations are conducted in various countries around the world, and we receive revenue and pay expenses from these operations in a number of different currencies. As such, our earnings are subject to movements in foreign currency exchange rates when transactions are denominated in (i) currencies other than GBP, which is our functional currency, or (ii) the functional currencies of our subsidiaries, which is not necessarily GBP. To estimate our foreign currency exchange rate risk, we identify material Euro and US Dollar trading and balance sheet amounts and recalculate the result using a 10% movement in the GBP:US Dollar exchange rate. For the trading figures the 10% movement is based on the average exchange rate throughout the reported period and for the balance sheet figures the 10% movement is based on the exchange rate used at June 30, 2026.
Excluding intercompany balances, our Euro functional currency net assets total approximately $28.0 million, and our US Dollar functional currency net assets total approximately $12.9 million. We use a sensitivity analysis model to measure the impact of a 10% adverse movement of foreign currency exchange rates against the US Dollar. A hypothetical 10% adverse change in the value of the Euro and the US Dollar relative to GBP as of June 30, 2026, would result in favorable translation adjustments of approximately $2.4 million and $1.3 million, respectively, recorded in other comprehensive loss.
Included within our trading results are earnings outside of our functional currency. Retained gains from Euro based entities earned in Euros and retained losses from USD based entities earned in US Dollars in the six months ended June 30, 2026, were €6.4 million and $1.9 million, respectively. A hypothetical 10% adverse change in the value of the Euro and the US Dollar relative to GBP as of June 30, 2026, would result in translation adjustments of approximately $0.7 million favorable and $0.2 million unfavorable, respectively, recorded in trading operations.
The majority of the Company’s trading is in GBP, the functional currency, although the reporting currency of the Company is the US Dollar. As such, changes in the GBP:USD exchange rate have an effect on the Company’s results. A 10% weakening of GBP against the US Dollar would change the trading operations results favorably by approximately $0.6 million and would result in unfavorable translation adjustments of approximately $3.5 million, recorded in other comprehensive loss.
For further information regarding the new external borrowings, see Note 7 to the Consolidated Financial Statements, “Long Term and Other Debt”.
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ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are controls and other procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Certifying Officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.
Under the supervision, and with the participation of our management, including our Certifying Officers, we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a15(e) and 15d-15(e) under the Exchange Act. Based on the foregoing, our Certifying Officers concluded that our disclosure controls and procedures were not effective as of June 30, 2026, due to the material weaknesses described in Item 9A of the Company’s 2025 Form 10-K.
Management continues to progress throughout 2026, with its remediation efforts regarding the previously identified material weaknesses. Specifically, management has implemented new systems and processes to enhance their internal SOX management testing programs, and staffing resources were also increased in both the Finance and IT departments to strengthen internal controls and support ongoing process improvements.
With respect to the material weakness identified and reported in our 2025 Form 10-K related to IT General Controls (as it relates to software updates by third-party vendors), management has designed and implemented procedures to address such deficiencies.
With respect to the material weakness identified and reported in our 2025 Form 10-K related to Capitalized Software and Contract Costs, the Company continues to design and implement new controls, as well as enhance its existing controls and procedures, to address the deficiencies identified.
With respect to the material weakness identified and reported in our 2025 Form 10-K related to revenue and accounts receivable, the Company is progressing through its remediation procedures designed to revalidate historical contracts and address the deficiencies identified.
As of June 30, 2026, as discussed above, the Company has made substantial progress in enhancing its systems, processes, and internal controls over financial reporting, which will also increase operational efficiency. Management remains committed to maintaining a strong control environment through the ongoing evaluation and enhancement of its processes and internal controls to ensure they are appropriately designed and operating effectively to support reliable financial reporting.
Management will additionally continue to implement measures designed to improve processes and address any new, or newly identified, areas of risk. These measures include: (i) ongoing training and education for control owners on control design and execution requirements (ii) the continued development and periodic updating of a comprehensive risk & control matrix supported by detailed process flows and narratives for each reporting cycle (iii) use of standardized control templates to promote consistency in control performance and documentation (iv) further enhance the governance risk and compliance (“GRC”) system to support SOX compliance and (v) enhanced quarterly reporting to the Audit Committee on progress and internal audit reports and findings.
Management’s objective is to complete its remediation efforts by the end of 2026. However, the timing of full remediation will depend on the successful implementation of the enhanced controls and management’s ability to demonstrate sustained operating effectiveness over a sufficient period of time with appropriate supporting evidence before concluding that the remaining material weaknesses have been fully remediated.
Changes in Internal Control over Financial Reporting
Other than the control changes to remediate previously identified material weaknesses, there were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
From time to time, the Company is involved in legal matters arising in the ordinary course of business. While the Company believes that such matters in which it is currently involved are not material, there can be no assurance that such matters, or other legal matters, will not have a material adverse effect on its business, financial condition or results of operations.
ITEM 1A. RISK FACTORS
Our business is subject to a high degree of risk. You should carefully consider the risk factors discussed in Part I, Item 1A of our 2025 Form 10-K. Any of these risks could materially and adversely affect our business, operating results, financial condition and prospects, and cause the value of our common stock to decline, which could cause investors in our common stock to lose all or part of their investments.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
The Company’s share repurchase activities for the three months ended June 30, 2026 were as follows(1):
| Period | Number
of shares | Average
price paid | Total
number | Approximate | ||||||||||||
| April 1, 2026 to April 30, 2026 | — | $ | — | — | $ | — | ||||||||||
| May 1, 2026 to May 31, 2026 | 56,714 | $ | 7.73 | 56,714 | $ | 21,520,608 | ||||||||||
| June 1, 2026 to June 30, 2026 | 263,281 | $ | 7.93 | 263,281 | $ | 19,431,796 | ||||||||||
| 319,995 | $ | 7.90 | 319,995 | $ | 19,431,796 | |||||||||||
| (1) | On November 5, 2025, the Company announced that the Board of Directors authorized the Company to repurchase up to $25.0 million of shares of the Company’s common stock (the “Share Repurchase Program”) on, or prior to, November 30, 2028. Purchases made under the program can be effected through open market transactions, block purchases, accelerated share repurchase agreements or other negotiated transactions. The first repurchases under the Share Repurchase Program were made on November 20, 2025. | |
| (2) | Reflects shares traded and retired as of June 30, 2026. Due to administrative processing times, 37,392 shares remained on the records of the transfer agent until July 2, 2026. | |
| (3) | The average price paid per share includes commissions related to the repurchases. |
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
During
the three months ended June 30, 2026, none of our officers or directors, as defined in Rule 16a-1(f) under the Securities Exchange Act
of 1934, as amended,
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ITEM 6. EXHIBITS
The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q:
| Exhibit Number | Description | |
| 10.1# | Employment Agreement, dated May 14, 2026, by and between Inspired Gaming (UK) Limited and Craig Wilson (incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K of the Company, filed with the SEC on May 18, 2026). | |
| 10.2# | Settlement Agreement dated May 18,2026 between Inspired Gaming (UK) Limited and James Andrew Richardson (incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K of the Company, filed with the SEC on May 18, 2026). | |
| 31.1* | Certification of Principal Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a). | |
| 31.2* | Certification of Principal Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a). | |
| 32.1** | Certification of Principal Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350. | |
| 32.2** | Certification of Principal Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350. | |
| 101.INS* | Inline XBRL Instance Document | |
| 101.SCH* | Inline XBRL Taxonomy Extension Schema | |
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase | |
| 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase | |
| 101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase | |
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
| # | Indicates management contract or compensatory plan. |
| * | Filed herewith. |
| ** | Furnished herewith. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| INSPIRED ENTERTAINMENT, INC. | ||
| Date: August 5, 2026 | /s/ A. Lorne Weil | |
| Name: | A. Lorne Weil | |
| Title: | Executive Chairman | |
| (Principal Executive Officer) | ||
| Date: August 5, 2026 | /s/ Craig Wilson | |
| Name: | Craig Wilson | |
| Title: | Chief Financial Officer | |
| (Principal Financial and Accounting Officer) | ||
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