Evolution Signals It May Abandon Galaxy Gaming Deal

Evolution, the Swedish live-casino supplier, looks ready to walk away from its roughly $85 million takeover of US table-games maker Galaxy Gaming — a deal it has chased for two years — after CEO Martin Carlesund told investors the agreement’s closing window expires today, July 17, 2026, leaving either side free to terminate. The signal came alongside second-quarter results that showed group revenue slipping again, though Europe returned to growth for the first time in several quarters.

Carlesund did not sound like a man expecting to close. Two years had passed, he told investors, and Evolution had poured significant time and resources into the administration required to complete the purchase. He then played down the fallout: “Galaxy is a great company; however, due to its size, the transaction is not significant for Evolution. The outcome has no material impact on our existing business, our US operations, or our long-term ambitions.”

Evolution agreed to buy Galaxy in July 2024, offering $3.20 a share in cash — a 124% premium — for a business it valued at about $85 million, or roughly $124 million including debt. Galaxy, based in Las Vegas, licenses proprietary casino table games and side bets such as 21+3 and Lucky Ladies to both land-based and online operators. For Evolution, the appeal was a deeper foothold in the US table-games market to sit alongside its dominant live-dealer studios.

What it never got was the sign-off. A gaming acquisition does not close when the parties sign; it closes when gaming regulators approve the change of control and clear the buyer as suitable. Galaxy shareholders backed the deal and Mississippi regulators approved it in November 2025, but the remaining US state approvals had not come through in time. The original mid-2025 target slipped, the two sides pushed the outside date to July 17, 2026, and that date has now come without the last clearances in hand.

Inside the numbers

For the second quarter, Evolution reported net revenue of €517.8 million, down 1.2% from a year earlier but up 2.4% at constant currency — the reported dip driven largely by currency swings. EBITDA held at €341 million, a 65.9% margin, and quarterly profit edged up to €251.4 million. Across the first half, revenue reached €1.03 billion.

Live casino remained the engine, generating €437.3 million, while the company’s random-number-generated slots and games brought in €80.5 million. That slots line grew 14% year-on-year — its first double-digit gain in about three years, a sign the group’s RNG brands are finally pulling weight after a slow stretch. Evolution also kept returning cash to shareholders, buying back 5.14 million shares, about 2.58% of its stock, for €303.2 million during the quarter.

A mixed map by region

The regional picture was uneven. Europe, long a drag, rose 3.5% quarter-on-quarter to €173 million, ending several quarters of decline, though it still sat about 4% below the prior year. Management credited demand for game shows and native-language tables while cautioning that low channelization — the share of play flowing to licensed sites — remains a concern as European governments raise gambling taxes and tighten rules. That squeeze has weighed on operators and suppliers across the region, from Rank Group to Sweden’s listed gaming names.

North America grew 9.5% year-on-year to €81 million, helped by the rollout of Monopoly Live across four states, a second Michigan studio, and Evolution’s expanded presence in Alberta after the Canadian province opened its regulated commercial market. Latin America was the standout, up 26.3% to €47.5 million, lifted by a relaunched Argentine studio and a localized version of its Ice Fishing title for Brazil. Asia remained the weak spot, falling 8.9% year-on-year to €190.5 million, a region Carlesund again described as volatile and dented by rising cybercrime.

A clearer regulatory runway

The results landed days after Evolution settled a long-running UK licence review for £4.75 million, closing a case the UK regulator opened in December 2024 after its content appeared on unlicensed sites reaching British players. Clearing that overhang matters beyond Britain. The same tightening scrutiny of suppliers’ place in the value chain has made US regulators more cautious about who they license — and it is exactly that kind of change-of-control review the Galaxy deal could not clear in time.

For a company that earns the bulk of its money from live dealers streamed to operators worldwide, an $85 million bolt-on was never going to move the needle. Letting it lapse frees Evolution to keep spending on studios, content and its own shares rather than on a US acquisition it spent two years failing to close.