DAVY VIEW

BetMGM has reported Q2 revenue growth of 3%. It has guided to the lower end of its prior guidance range of $2.9-3.1bn (DavyF: $3.0bn) and the lower end of its range of aEBITDA of $300-350m (DavyF: $300m). At the bottom end of the revenue range, it indicates c.4% year-on-year (yoy) growth. Management has alluded to regulatory complexity and an increasingly competitive environment. It has also stepped back from its prior expectations of delivering $500m of aEBITDA in 2027 and is instead confident of delivering this in the coming years. Overall, the projected revenue growth is somewhat underwhelming, and management will need to flesh out its comments on the environment being increasingly competitive and its expected response to abate concerns.