Inspired Entertainment Q4 2025 Earnings Call - Interactive Growth Drives Margin Turnaround Toward Mid-40s

Operator: Good morning, everyone, and welcome to the Inspired Entertainment fourth quarter and full year 2025 conference call. All participant lines have been placed on mute to prevent any background noise. After the speaker’s remarks, we will open the call for a question-and-answer session. Please note that today’s event is being recorded. Before we begin, please refer to the company’s forward-looking statements that appear in the fourth quarter 2025 earnings press release and in the accompanying slide presentation, both of which are available in the investor section of the company’s website at www.inseinc.com. These also apply to today’s conference call. Management will be making forward-looking statements within the meaning of the United States securities laws.

These statements are based on the management’s current expectations and beliefs and are subject to various risks, uncertainties, and other factors that may cause actual results to differ materially from those expressed or implied in such statements. For a discussion of these risks and uncertainties, please refer to the company’s filings with the Securities and Exchange Commission. During today’s call, the company will discuss both GAAP and non-GAAP financial measures. Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures can be found in today’s earnings release and slide presentation, which are both available on the website. With that, I would now like to turn the call over to Lorne Weil, the company’s Executive Chairman. Mr. Weil, please go ahead.

Lorne Weil, Executive Chairman, Inspired Entertainment: Thank you, operator. Good morning, everyone, and thank you for participating in our year-end conference call. As it happens, Brooks and I are doing this call from a major lottery conference in Florida, where there is a lot of buzz about the things we have going on in the lottery space, including the amazing cloud-based lottery platform we launched a few weeks ago that you may have read about in a recent press release. We won’t have much more to say about lottery today in our prepared remarks, but we’re happy to elaborate in the Q&A, and we certainly expect to be talking more about it in the coming quarters. That said, I’ll begin the call today with a few introductory remarks considering the fourth quarter and full year and then hand it over to Brooks to discuss the quarter in detail.

Beginning with slide three, I think we can look at the quarter as an important milestone in the steady transformation that’s been occurring in the company. As we’ve discussed previously, hopefully not ad nauseam, the transformation continues to be led by the interactive business, which grew revenue and EBITDA by 53% and 60% respectively in the fourth quarter. In a moment, Brooks will discuss the nature of the tremendous resilience we have built into this business together with the steps we’re taking to ensure that at the same time we continue to drive growth. These kinds of growth rates were moderately interesting a few years ago when we were growing off a base of a couple of $ million, but on a base upwards of $50 million at present, it’s a whole other story, obviously.

In our last conference call, we talked about targeting to get our company-wide EBITDA margin into the mid-40s. Our margin for the full year 2025 was 37%, but in the fourth quarter it reached 42%, a record for any single quarter in our company’s history. As noted in the slide, we’re comfortable with 2026 EBITDA guidance of $112 million-$118 million, with the midpoint of $115 million representing low double-digit growth over 2025 if we exclude the divestiture in Holiday Parks EBITDA. This would put our full-year company-wide margin squarely into the mid-40s. As I’ll touch on at the end of the program, we’re comfortable that this momentum for the company as a whole will continue through into 2027.

While the interactive business follows its growth trajectory, our equipment businesses are continuing to move in an asset-light direction, and these together are positively impacting free cash flow. As noted in the slide, we expect to be de-leveraging through 2026, targeting to be at 2.5-3 times net leverage by year-end. This will lead in turn to a step-down on our interest rate and perhaps other financing options as well. On that note, I’ll turn things over to Brooks.

Brooks, Chief Financial Officer or Chief Operating Officer, Inspired Entertainment: Okay, thanks, Lorne. Moving to slide four, we’re gratified to see the results in the fourth quarter justify the key premise that we’ve been discussing over the course of the year. That is, the combination of the mix of our business becoming more and more digital, and particularly with the strong growth in our interactive segment, and also the disposal of the lower-margin holiday parks business, would drive our EBITDA margins over 40%, and our fourth quarter results strongly validate that thesis. Moving to slide five. This slide visually depicts the progress we’ve made in our mix and its impact on our EBITDA margins, but it goes beyond that. We’ve made a conscious decision to focus on CapEx-light business.

Combining this with our significantly reduced headcount discussed last quarter will prove to materially improve the cash flow of the business on a going-forward basis. We expect these trends to continue throughout 2026, and we’re targeting EBITDA margins in the mid-40s% with significant improvement in cash flow. Moving to slide 6. It’s important as well to note that our focus is not solely on improving the EBITDA margins and cash flow, but also in growing each of the segments of the business. More than 80% of our revenue is recurring. Along with growth, we need to continue to renew contracts with our key customers, and we are very proud of the long-term relationships we’ve had with customers like bet365 and Entain and the faith they put in us to continue to innovate our products and enhance player engagement.

I’ve discussed on previous calls the importance I place on getting access to the North American market for our Virtuals business and having the product fully integrated in the sportsbook section of the site rather than in the casino section. I’m excited to announce the successful launch with BetMGM as our first tier one customer to have launched with three sports, including our NFL licensed game, now live in New Jersey and hopefully going live in additional states in the near term. We’ve had success with BetMGM in Ontario and have worked with their team on this development, and I believe this will be the start of utilizing some of the key licenses we have with the NFL, the NBA, and the NHL in getting broader distribution in the North American market. We’re in discussions with several other sports betting operators, but BetMGM has the market to themselves for now.

Getting this launched in time for the World Cup is ideal, and we believe this will provide a good proof point for other operators. Moving on to slide 7. We’ve now had 10 quarters in a row of more than 40% EBITDA growth in our Interactive segment, and that shows no sign of slowing down. We just had the single highest day and the single highest weekend of GGR in this segment over the last weekend in February. I’m also happy to announce, just based on this morning’s results, that we had the best week we’ve ever had last week. We’re laser-focused on keeping this performance going and are expanding our brands, our unique game mechanics, and adding studio capacity that will come online in the second half of the year and increase the output of titles to support this high-growth segment.

Alongside this organic growth, we have several opportunities to expand our footprint geographically, and we still believe that it’s a matter of when and not if that additional states will legalize iGaming in their states, as we’ve seen with Maine and progress in other larger states like we’re seeing in Virginia. Although it’s difficult to forecast when this will happen and which states will add this capability, we do believe that it’s an underappreciated potential step change for Inspired. The upside is not limited to Interactive either, as we are excited to see the growth potential for our North American gaming machine sales with the recent changes in Illinois to expand into Chicago. We’re now indexing at our highest levels since we went into the market and have strong relationships with key customers like J&J and Accel.

We’re confident that we’ll grow our footprint over the next 12-18 months in Illinois substantially and believe that the Illinois model can be replicated in other states. Distributed gaming is in our DNA. It’s where content is the key differentiator, and that’s what we do best. Moving on to slide 8. We prepared slide 8 just to show that our iGaming performance isn’t driven by just recent momentum or one-hit wonders. This graph shows how our games produced even earlier than 2022 continue to generate a consistent base of revenue year over year. Each year’s new games simply build on top of that foundation. We’re not starting from zero every year. We continue to grow and sustain that growth by building on brands and game families that resonate with players as well as unique game mechanics.

The key is to continue to innovate and add capacity on top of that foundation. Moving on to slide 9. Our proprietary game titles and mechanics create multiple important advantages. Firstly, they build strong brand recognition and loyalty with players. Players know and trust brands like Wolf It Up, which allows us to do multiple iterations and extensions faster and more cost-efficiently. We’re using this to expand our Hybrid Dealer portfolio as well and are looking forward to the release of our Wolf It Up Roulette game to build on the momentum we’re seeing in Hybrid Dealer, where turnover is up 51% quarter-over-quarter and 39% increase in customers live. We just went live yesterday with the Flutter brands like Paddy Power and Betfair in the UK, and we’ll be adding both DraftKings and Betfred in the next quarter.

These proprietary brands strengthen our relationships with our operator customers. When they know our game families and mechanics will consistently perform well, they place the games in the most desirable positions on their sites and keep them there longer. This benefits everyone in the ecosystem and creates opportunities for us to do creative commercial arrangements with key operators for exclusivity and promotions. A true win-win for all. Moving on to slide ten. As noted in the past few slides and then on slide ten, this is really all about building a scalable and sustainable Interactive business. Typically, adding more games comes at the expense of revenue per title. As the portfolio grows, performance per game often declines, but that’s not the case with our Interactive portfolio. We’ve been able to expand the number of games while also increasing revenue per title.

That’s why we’ve been able to deliver the kind of growth that you’ve seen in the segment, improving overall digital mix for Inspired and ultimately higher EBITDA margins. Of course, that’s why we’re adding another high-quality studio to our network. Moving on to slide 10. Whether it’s Interactive, whether it’s Virtuals or gaming machines, we’ve consistently stated that content drives everything we do at Inspired. Our recent success in the rollout of Vantage cabinet to the William Hill estate and our improvement and leading position in Greece, which we’ve maintained for years now, is a testament to not only the content, but also leveraging our industrial design to build high-performing cabinets at a fraction of the cost that you would see for a Class III casino floor in North America.

We’re proving that we can replicate our success in the U.K. and Greece further in North America with our performance in Illinois, as well as our continuing share gain in key VLT markets in Canada. Moving to slide 12. Finally, slide 12 gives some of the latest data on the size and scale of iGaming compared to sports betting GGR. In states where they go head-to-head with sports betting, iGaming is more than three times the size of sports betting. Extrapolating that to other states is a big outsized opportunity for us that we don’t include in our forecast, but believe that it is inevitable and would be transformative for Inspired as the flow-through margins and cash contribution would be very significant. With that, I’ll hand it back over to Lorne.

Lorne Weil, Executive Chairman, Inspired Entertainment: Thanks, Brooks. That was a terrific deep dive. Before I move into a discussion of the guidance, let’s take a minute to recap where we ended 2025 on slide 13. Our EBITDA was $111 million, a little ahead of consensus in both revenue and EBITDA, 11% up over 2024, with an EBITDA margin of 37% of revenue. Our digital business accounted for 51% of EBITDA and leverage was 3.3. Turning now to slide 14, we see 2026 and 2027 evolving as shown. As mentioned earlier, we’re projecting 2026 EBITDA at the midpoint to be low double digits ahead of 2025, excluding the divested holiday parks EBITDA. From midpoint to midpoint, this growth rate should continue comfortably through 2027.

At the same time, we’re projecting that our digital business will grow from 51% of EBITDA to more than 60%. EBITDA margin to expand to 45%+, and the leverage to be 2.5 approaching 2. Finally, with reference to slide 15, I’d like to announce at this time a change in the way we will be reporting going forward, which we think simplifies our story and much more accurately reflects the operating characteristics of the businesses. As we have explained before, our leisure segment, until very recently, comprised two very different businesses. A server-based machine business focused on pubs, motorway service, bingo halls, et cetera, whose business model is very similar in nature to what we’ve been calling gaming. The recently divested holiday parks business that was predominantly an amusement machine business with a very different business model.

Now that we have divested Holiday Parks, we’ll be combining gaming and the remaining leisure businesses into one reporting entity to be called Retail Solutions. We think this will reflect our current management structure and make the company more easily understood, as well as generate some interesting operating synergies. Now looking at slide 16. Finally, let’s touch on our investment thesis, which is very simple and which is being pretty well validated at this time. The swing in the business mix to higher growth, higher margin, less capital intensity is having the intended result. Revenue is overwhelmingly recurring in nature and growing. EBITDA margins in the forties and moving higher. Capital expenditure showing meaningful decline despite growing revenue and EBITDA, and steady declines in leverage and interest expense. At this point, operator, we’re happy to turn the program over to Q&A.

Operator: Thank you. The floor is now open for questions. If you have dialed in and would like to ask a question, please press star one on your telephone keypad to raise your hand and join the queue. If you wish to withdraw your question, simply press star one again. If you are called upon to ask a question and are listening via loudspeaker on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. Again, to join the queue, it is star one. Your first question comes from the line of Chad C. Beynon of Macquarie. Your line is open.

Chad C. Beynon, Analyst, Macquarie: Hi, good morning. Thanks for all the additional commentary on the deck and the guidance, guys. Just wanted to start with UK. I know last quarter you talked about how well you navigated the triennial review a couple of years ago. It doesn’t appear that any of your partners have really made any changes ahead of the upcoming tax change, but just wondering how that’s factored into your guidance, maybe your discussions with them, and if you expect you know, any mitigation either by you guys or your partners when that’s rolled out. Thank you.

Brooks, Chief Financial Officer or Chief Operating Officer, Inspired Entertainment: Yeah. Hi, Chad. Yeah, I think we are seeing that. I mean, if you go down the laundry list of customers in the UK, many of them are going to adjust their RTP to reflect the increase in taxes, and I think they’re also going to adjust their bonusing structures and how they bonus players because of that. I think, frankly, with the conversations we’ve had with them and the, you know, the

Lorne Weil, Executive Chairman, Inspired Entertainment: The target that we’ve said in terms of what we think the impact of taxes, we feel better about that now than we did even before, just because now the operators are certainly going forward and implementing their plans. We’ll know here in a few weeks once it goes in in April. I suspect there’ll be, you know, some impact in the beginning like there always is, but we expect to be able to mitigate that. We’re comfortable with the impact as we’ve talked about in the last quarter.

Chad C. Beynon, Analyst, Macquarie: Great. Thanks, Brooks. Then in terms of the capital allocation strategy, you know, across the entire digital sector globally, we’ve just seen, you know, some valuations come down, I think, mainly because of the threat of prediction markets, and it might give you guys an interesting opportunity to either, you know, repurchase stock or execute on that bolt-on acquisition that we had talked about in the past on conference calls. Wanted to get your update on that, Lorne and Brooks, how you kind of see the market at these valuations. Thank you.

Lorne Weil, Executive Chairman, Inspired Entertainment: Sure. I mean, it’s Chad, it’s actually a complicated and multifaceted question. Like, let me comment for a second first on the root of your question, which is about the prediction market. I mean, we know right now the overwhelming majority of prediction market handle is on sports. I think for calls, I think it’s upwards of 90%. You know, there’s a lot of talk about people betting on, you know, the fall of the regime in Iran and, you know, when some famous Hollywood actress is going to get pregnant. The fact is, it’s almost entirely about sports. What you’re seeing in terms of valuations is whether it makes sense or not, it’s pretty much focused on people whose business is primarily in the sports business.

You know, we’re not only completely insulated from that, but there’s actually an interesting case to be made that it will accelerate the growth in iGaming and in iGaming states because of the impact on state revenues of the swing and the sports betting handle from the sports betting operators to the prediction markets. You know, we’ll have to see how that plays out, but it would be an interesting irony that we would actually benefit from the prediction markets. In terms of the second part of the question, which is the impact on valuations. Yeah, for sure. I mean, you know, at our current valuations, you know, even though, as I said a number of times before, for a variety of reasons, strategically, we’re probably more focused on deleveraging than we are on share repurchase.

At a certain point in valuations, it’s too ridiculous to not do everything we can to take advantage of that opportunity. Since we have a pretty good buyback plan in place, and we have a significant headroom in our credit agreements to buy back stock, I think it’s safe to say that we’ll be putting stock valuation in proper perspective in our asset allocation, at least for the present time, Chad.

Chad C. Beynon, Analyst, Macquarie: Thanks, Lorne. Appreciate it. Good luck.

Operator: Your next question comes from the line of Jordan Bender of Citizens JMP. Your line is open.

Jordan Bender, Analyst, Citizens JMP: Everyone, good morning. Thanks for the question. If I compare your targets that you gave a couple of months ago to what you have in the deck today, the 27 targets, even adjusting for the UK taxes, appears to be better than what you had put out previously. You know, you guys have you kind of went through the prepared remarks and talked through the digital business and the positive momentum you’re seeing there. Can you just kind of help us unpack, you know, what you’re seeing, if I’m reading this correctly, that your expectations are maybe lifted from what you were seeing before? Thank you.

Lorne Weil, Executive Chairman, Inspired Entertainment: I mean, I think I guess to answer your question is, and I’m not sure exactly what the reference is to 27. I know Lorne just mentioned it in the remarks. We’re not seeing anything that would tell us that the momentum is not gonna continue. As I mentioned in my remarks, because I just happened to get them this morning, you know, the last week we had was the best week we’ve ever had. We’re seeing the momentum continue certainly in the interactive business. We have a number of drivers in the Virtual Sports business staying in the digital space that we think are just, you know, about to come upon us. Obviously, the North American launch.

Certainly, we’ve got some opportunities in Brazil that we are pretty excited about. The World Cup is coming up here in the next couple of months.

Brooks, Chief Financial Officer or Chief Operating Officer, Inspired Entertainment: We don’t see anything on the horizon that tells us anything other than this momentum is going to continue.

Jordan Bender, Analyst, Citizens JMP: Okay. Yeah, that was in reference to your EBITDA targets in 2027, but that answered that. Thank you. And then just on the follow-up, in the press release, you kind of talked about your iGaming market share in the U.S. improving, you know, quarter-over-quarter and the results that led to. Can you just kind of talk to what you’re seeing there from a customer perspective, and I guess also a spend perspective from those customers? Thank you.

Brooks, Chief Financial Officer or Chief Operating Officer, Inspired Entertainment: Yeah, I mean, it’s kind of an interesting dynamic going on with what’s called the big three customers, DraftKings, FanDuel, and BetMGM. You know, we talked a little bit about the game mechanics and some, you know, some titles that we have using this thing that we call CashBank. So it’s kind of morphed into each one of the big three have kind of taken under their wings an individual brand. DraftKings is really strong with Wolf It Up!. FanDuel is really strong with this new Kong It Up!. And so what’s happening is the big three are continuing to grow for us from a share perspective, and we’re getting better placement, et cetera, et cetera.

We’re also doing extremely well with companies like, you know, Rush Street Interactive and Fanatics and so on and so forth. It really is. It’s kind of across the whole board, but I’d say probably the biggest driver in terms of the share gain is our game with the top three operators.

Jordan Bender, Analyst, Citizens JMP: Understood. Thank you very much.

Brooks, Chief Financial Officer or Chief Operating Officer, Inspired Entertainment: Thanks, Jordan.

Operator: Your next question comes from the line of Ryan Sigdahl of Craig-Hallum. Your line is open.

Ryan Sigdahl, Analyst, Craig-Hallum: Hey, good morning, guys. Want to say on the UK, you mentioned kind of from a tax increase on the digital side and strategies changing. Curious if you’ve heard anything from a retail standpoint if any of your key customers are planning to shift promotions, marketing, et cetera, back to the retail side, just given the balance between online and retail.

Brooks, Chief Financial Officer or Chief Operating Officer, Inspired Entertainment: Yeah, I mean, I think they look at it holistically, as you know, as we’ve talked about before, kind of a whole ecosystem. I, you know, I think it’s pretty clear that from a margin standpoint, that they would be benefiting with some of this business moving to retail from online. Certainly the sense that we get from the, you know, the operator customers is that they’re trying to mitigate the online tax thing as much as possible. Obviously, you know, the more business that flows through the retail channel, is certainly better for them from a margin perspective. It’s interesting, you know, one of the things we’ve talked about is the, you know, some of the shop closures with William Hill.

One of the questions people ask, "Well, you know, what do you do with those machines that are gonna be coming out of the shops?" Ryan, as you know, we’ve talked a lot about, you know, the shop closures are generally on the, you know, long end of the tail. So they’re the least performing shops. But ironically, a number of these shops are being secured by other independent operators that are also customers of ours. So we’ve had the ability to be able to take the machines that would be coming out of the William Hill shops, and either somebody else, another operator will buy the shop themselves or they’re expanding on their own, and we’ll move the machines into that part of the business.

I think, you know, obviously, nobody likes to hear anything about shop closures, but I think ironically, at the end of the day, we might actually be better served with the reconfiguration, you know, across the portfolio of LBO companies in the UK with some of the lower performing shops going to other operators.

Ryan Sigdahl, Analyst, Craig-Hallum: Virtual Sports, last quarter, you expected growth year-over-year from a revenue standpoint in Q4. That didn’t happen. I’m just curious, you know, what changed versus your expectations, but you did see very nice margin expansion. I guess, is that sustainable? What happened on the top line? What happened on EBITDA? And should we expect kind of that higher level of EBITDA margin to be sustainable going forward? And then maybe last point on Virtual Sports, just the Bet Builder product. I know it’s very, very early, and OPAP launched it, but curious if you can quantify any kind of uplift, what you’ve seen there, and then how you plan to if you do accelerate that pipeline ahead of the World Cup. Thanks.

Brooks, Chief Financial Officer or Chief Operating Officer, Inspired Entertainment: Yeah. I mean, we’re certainly racing to answer your second question first. We’re racing to get everybody, you know, we announced the contract extensions with bet365 and Entain, both of which are, you know, very big customers of ours, and we’ve got long-term extensions with them. We’ve secured our future, I think, in the Virtual Sports business on a going forward basis. The Bet Builder product, you know, has shown modest growth in OPAP, and I don’t think there should be an expectation that this is gonna be, you know, anything more than a high single-digit increase.

To be perfectly honest, in the, you know, the first quarter, we’ve seen a little bit of softening in the Brazil market in Virtual Sports, and which we think is probably a little bit of the seasonality and a little bit of a lag pre-World Cup.

Lorne Weil, Executive Chairman, Inspired Entertainment: In Virtual Sports, we’ve got a lot of things going on in that space that we hope will be able to drive the top-line revenue. I think we are comfortable with the margin expansion that you saw in the, you know, in the fourth quarter. Obviously, a big part of that is can we get the revenue going, in the way that we’d like to see it go. Kind of a little bit of a mixed bag so far that we’ve seen in the first part of the first quarter. We’ll obviously be reporting on that here coming up in the not-too-distant future.

Ryan Sigdahl, Analyst, Craig-Hallum: Thanks, Brooks. Good luck, guys.

Lorne Weil, Executive Chairman, Inspired Entertainment: Thank you.

Operator: Your next question comes from the line of Barry Jonas of Truist Securities. Your line is open.

Barry Jonas, Analyst, Truist Securities: Hey, guys. I wanted to start with the Iran conflict. You know, I think a lot of investors are wondering how we should be thinking about any potential impacts to your business. Specifically, maybe talk about any historical sensitivity to higher oil and gas prices. Thank you.

Lorne Weil, Executive Chairman, Inspired Entertainment: Well, you know, over the course of the few years that we’ve been in this business and the many, many years that we’ve been in this industry in other companies, we’ve had a number of crazy gyrations in the energy market, and I don’t think, at least in my personal experience, Barry, I’ve seen much of an impact of that on our business. I mean, I suppose if the price of oil were to go up high enough, long enough that and that it impacted you know, players’ disposable incomes, that might show itself up in in our business. But I don’t I haven’t seen much evidence of that in the past, and I’m at least right now, it’s not something that we’re focused on.

There is sort of some issue, I suppose, in some businesses of supply chain disruption associated with this, let’s call it a situation since the president’s not calling it a war. Our supply chains are in terrific shape right now. You know, we had this thing with a memory chip shortage, but we have fixed that. I think right now I’m cautiously optimistic that we’re pretty well insulated from this. You know, it’s a crazy volatile world and anything is possible.

Barry Jonas, Analyst, Truist Securities: Great. Just, you know, Lorne, you teased it in the opening remarks, so I’ll bite. Can you maybe talk more about the Strata lottery platform? You know, I think you’ve been working on this for a while, right?

Lorne Weil, Executive Chairman, Inspired Entertainment: Yeah.

Barry Jonas, Analyst, Truist Securities: SkillTech acquisition. We’d love to get your thoughts on the market opportunity and maybe potential timelines given how lengthy RFP processes are usually.

Lorne Weil, Executive Chairman, Inspired Entertainment: Sure.

Barry Jonas, Analyst, Truist Securities: Thank you.

Lorne Weil, Executive Chairman, Inspired Entertainment: Yeah. We’ve spent probably two and a half years developing this. We developed it completely from scratch with a complete clean sheet of paper. You know, we’ve done this. I think the first lottery system I personally was involved in developing was back in the seventies when I was working with a company who put in the very first digital lottery system in the world. We did it again very, very successfully at Scientific Games, and now we’ve just done it yet again. It seems like a life sentence. We assembled probably the best team of developers in the lottery industry. The system is completely cloud-based.

It was designed to be integrated retail and online, and it’s running flawlessly in a very commercially successful lottery in North America with about 2,500 retailers. This system could go to 25 million retailers if we ever had to. We’ve had, you know, very significant reaction to it in the market. I think probably our focus in terms of the market opportunity for it is gonna be outside the United States, at least for the first few years. These are customers and markets, again, going back to our Scientific Games days that we’re very familiar with. The architecture of the system and the functionality of the system is, let’s say, geared to those kinds of markets.

I wouldn’t right now want to try to predict when we’ll begin to see. I mean, we’re getting significant revenues, you know, $ a few million a year from the system right now in the Dominican Republic. But as we begin to expand that throughout the Caribbean, Latin America, and probably Europe, I certainly, over the course of the next couple of years, we should start to see significant revenue and again, that’s something that’s not factored at all into the guidance that we gave earlier.

Brooks, Chief Financial Officer or Chief Operating Officer, Inspired Entertainment: Yeah. Barry, just to add maybe one more point. I think that’s, you know, as Lorne said, our focus over the next couple of years is primarily outside the U.S., and that’s generally a sales market as opposed to, you know, recurring revenue market. We certainly have had a number of people that are interested when they’ve seen the results of what we’ve done in the DR. You know, we’re gonna start building a pipeline, hopefully of opportunities that we’ll be able to talk about, you know, coming up. But it’s not like bidding for, you know, a big U.S. state. That’s a completely different kind of business.

Barry Jonas, Analyst, Truist Securities: Perfect. Thank you so much.

Operator: Our last question comes from the line of Josh Nichols of B. Riley Securities. Your line is open.

Josh Nichols, Analyst, B. Riley Securities: Yeah. Thanks for taking my question. Great to see, you know, very strong quarter yet again for the interactive business. I was just curious, when you look at, you know, the north of 50% growth that you’re seeing here, what’s your expectations in terms of sustainability when you kind of look at the pipeline for 2026, 2027 to maintain that type of pace of growth? I know the U.K. tax increase may have some impact on margins, but I’m just curious, like, where you think the trajectory for that type of growth rate is likely to level out over the next 12 months or so.

Brooks, Chief Financial Officer or Chief Operating Officer, Inspired Entertainment: Yeah, that one is hard to say. I think if you had asked me several years ago if we would have more, you know, 10 quarters in a row of more than 40% EBITDA growth in this segment, would we have predicted that? I’d say no. You know, every time I look at the numbers, I keep wondering if, you know, we’re gonna start hitting a wall, and that doesn’t seem to be the case, certainly through as of this morning. I think in the U.K. in particular, and you’ve probably seen it, I know Entain in their results talked about this a lot, is I think the stronger both operators and suppliers are gonna tend to thrive in this environment.

I would. You know, we’re more than 10% share in the UK, and I fully expect, even with the tax situation, that we’ll be increasing our share because there’s gonna be some, you know, providers that just don’t have enough scale to be able to make it. All I can say is we’re not seeing any indications of slowing yet. But certainly mathematically, you know, it’s not possible to sustain this forever. But we’re seeing nothing that would lead us to believe that it’s gonna slow down anytime soon, both in North America and in the UK. Don’t forget, we’re also adding. We’ve talked about this, we’re adding additional geographies. We’re going into South Africa, and we’ll go into another couple of geographies.

Our hope is that if there’s any softening in the two biggest markets, that we can fill that gap with new geographies, to just, you know, continue to keep this going.

Lorne Weil, Executive Chairman, Inspired Entertainment: Just one other point on that, Josh. You mentioned the impact of the tax on margins, but just to be clear, the way the tax works, it actually we shouldn’t have any effect on our margins because our revenue is a % of our customers’ GGR. Certainly the increase in the tax would have the effect of reducing our customers’ GGR, but our margin on the revenue that we get from that customer shouldn’t have any impact at all. Obviously, it’ll impact the revenue, but not the margin.

Josh Nichols, Analyst, B. Riley Securities: Yeah, thanks for clarifying. On that front, I think just one more follow-up. I mean, a pretty big shift. You go into a very asset-light model here. The headcount is already down pretty significantly, and we’re expecting to see, you know, CapEx step down as well too. I know it looks like there was some outsized CapEx, right, in 4Q. Is everything now on a more normalized, asset-light, digital-focused basis going forward as we start, you know, with 1Q of 2026? Or is there a little bit more work to be done to get to some of those targets that you kind of laid out for 2026 and 2027?

Brooks, Chief Financial Officer or Chief Operating Officer, Inspired Entertainment: No, I think the targets are solid. The composition’s gonna be slightly different because one of the things that we’re doing from a CapEx perspective, you know, we’ve talked a lot about this morning about the Dominican Republic lottery. We’ve replaced the system, and now we’re in the process over the next couple of years of replacing the terminals down there because this is a long-term contract. I think the total amount of CapEx is going to be as we’ve laid out for everyone. I think the composition will be slightly differently because there’ll be some investment over the next two years in lottery terminals and then

Lorne Weil, Executive Chairman, Inspired Entertainment: You know, going out to year three and four, we would hope to have a, you know, a step down even further other than potential expansion opportunities. I think the model, Eric or Amy can jump in if they feel or if they have anything else, but I think what we’ve laid out for you guys from a CapEx perspective, we feel very good about.

Eric, Finance Executive, Inspired Entertainment: Yeah. The only thing I’ll add to that, this is Eric, Josh, is when you look at our reporting, the, you know, CapEx will include sort of all our gross CapEx. It. In our presentation on slide 14, we have a cash CapEx number, which we footnoted. It excludes any purchases of PP&E that are customer funded, effectively where we receive the cash up front. So if you look at it through that perspective, 2025 is about $44 million as opposed to, I think the number is, like, upwards of $55-$56 million just from our financial statements. So just wanted to make sure you understood that caveat, and we can chat later offline if not.

Josh Nichols, Analyst, B. Riley Securities: No, I think I’m good. I’m right around, like, I think the 46 number. Appreciate it. Thanks, both.

Operator: That concludes our Q&A session. I’ll now turn the conference back over to Mr. Weil, Executive Chairman, for closing remarks.

Lorne Weil, Executive Chairman, Inspired Entertainment: Thanks, operator. I don’t really have much more to add to what we said already. As I said in my remarks earlier, I think the fourth quarter was a very important milestone in terms of the transformation or the evolution that we’re going through. We feel pretty good that it will continue in that direction into the first quarter of 2026 and through 2026. Thank you for your support. We’ll look forward to speaking to you again in a few months. Thanks.

Operator: This concludes today’s conference call. You may now disconnect.