Q2 in Latin America: Brazilian Growth and Tax Hurdles

The Latin American gambling market remains a focal point for global operators, with Brazil’s newly regulated online sector attracting significant investment seven months after its launch. However, escalating tax burdens in Peru and Colombia continue to temper regional optimism. Flutter Entertainment’s acquisition of a 56% stake in NSX — parent of the Betnacional brand — has quickly boosted its footprint. The deal, which complements Flutter’s Betfair Brazil operations, helped drive Brazilian revenue up 144% year-on-year in Q2 to $44 million, offsetting a slight decline for Betfair Brazil due to adverse sports results and friction from new know-your-customer (KYC) rules.

CEO Peter Jackson signaled further Latin American ambitions, stressing Brazil’s “very significant” potential. Flutter aims to improve both sportsbook and iGaming products over the next 12 months, targeting “quick wins” in product and marketing to consolidate market share. Entain also reported a solid first half in Brazil, with net gaming revenue (NGR) up 21% year-on-year, making it the company’s fastest-growing market outside the US. However, CEO Stella David acknowledged compliance challenges tied to KYC re-registration and warned about potential black market growth if Brazil makes its provisional gross gaming revenue (GGR) tax hike from 12% to 18% permanent.

BetMGM, operating in partnership with Grupo Globo, is aiming for a 10% Brazilian market share. CEO Bill Hornbuckle described the launch as making “great strides,” with aggressive Q2 marketing spend following an initial product-focused phase. Betsson posted record Q2 Latin American revenue of €84.7 million, a 35.4% year-on-year increase. The region now accounts for 28% of the group’s total revenue, with strong contributions from Peru and Argentina. Sportsbook growth more than offset a small casino revenue dip. CEO Pontus Lindwall noted impending challenges, including possible ad restrictions and tax rises in Brazil, as well as increased taxes in Peru and Colombia. Still, he maintained confidence in Brazil’s long-term potential, signaling openness to mergers and acquisitions once market conditions stabilize.

 

Operator	Key Market	Q2 Revenue / NGR	Growth / Change	Notes
Flutter	Brazil	$44M	+144% YoY	NSX acquisition boosts Betnacional; Betfair Brazil slightly down
Entain	Brazil	N/A	+21% YoY	Compliance challenges; £28M EBITDA hit from taxes
BetMGM	Brazil	N/A	N/A	Targets 10% market share; Q2 marketing push
Betsson	LatAm (Peru, Argentina)	€84.7M	+35.4% YoY	Record regional revenue; Brazil tax/ad restrictions noted
Codere Online	Mexico	€29M	+2.8% YoY	Brazil entry cautious; Colombia scaled back due to VAT
Rush Street Interactive	Mexico	N/A	+125% YoY	Strong growth; Colombia VAT impacts profitability
Super Group	LatAm	$5M	-44% YoY	Brazil exit; weak Mexico performance

 

Mixed Fortunes in Mexico, Colombia

Codere Online saw steady growth in Mexico, with Q2 revenue up 2.8% to €29 million despite peso devaluation. However, CEO Aviv Sher remains cautious about Brazil, citing high entry costs. The company has significantly reduced Colombian operations in response to a temporary 19% VAT. Rush Street Interactive (RSI) also reported robust Mexican growth, with revenue surging 125% year-on-year. CEO Richard Schwartz expects Mexico to become one of RSI’s largest markets, though Colombia’s VAT continues to pressure profitability despite higher gross gaming revenue. CFO Kyle Sauers anticipates a turnaround in 2026 when the VAT expires.

Super Group’s Latin American revenue almost halved year-on-year after its Betway brand exited Brazil, compounded by weak performance in Mexico. Supplier Kambi reported modest gains, with a 3.4% increase in operator turnover in the Americas, driven by Brazil’s launch and strong Club World Cup betting.

 

We retain a strong conviction that the market opportunity [in Brazil] will be very significant, and that those operators with scale and the best product will win the largest share of the market.

 

Outlook

Brazil is emerging as Latin America’s growth engine for global gambling operators, with rapid market penetration, high player engagement, and strong product investment. However, the region’s regulatory environment remains volatile. Tax increases and compliance requirements in Peru and Colombia threaten profitability, while Brazil’s policy direction will be critical in determining whether operators’ bullish strategies can deliver sustainable returns.