Inspired Entertainment, Inc. (INSE) Stock Analysis and Metrics

Inspired Entertainment

NASDAQ: INSE

$7.04 ▼ -0.06 (-0.85%)

At close: Jul 28, 2026 · 3:59 PM UTC

Financial Ratios

Market Cap207.07 Mn

P/E-20.30

P/S0.73

Div. Yield0.00

ROIC (Qtr)0.01

Total Debt (Qtr)326.30 Mn

Revenue Growth (1y) (Qtr)-5.30

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About

Inspired Entertainment, Inc. is a global gaming technology company that supplies 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. The company provides end to end digital gaming solutions on its own proprietary secure network and through third party networks, serving venues such as licensed betting offices, casinos, gaming halls, adult gaming centers, pubs, bingo halls and motorway service areas. It holds licences from regulators in the United Kingdom, Italy, Greece, Malta, Gibraltar, Alderney, Belgium, Romania, Sweden, Peru and numerous US states and Canadian provinces, allowing it to operate in multiple jurisdictions.

Inspired Entertainment, Inc. generates revenue primarily through the sale and licensing of gaming terminals, software and game content as well as through participation based arrangements where it receives a share of the gross revenue generated by its machines. The company also earns income from upfront software licensing fees, integration fees, hosting fees and fixed daily fees for certain installed units. A significant portion of its revenue is recurring, derived from long term participation based contracts that typically run for three to five years, providing visibility and stability to cash flows. Revenue is derived across its four business segments Gaming, Virtual Sports, Interactive and Leisure.

The company operates through the following segments: Gaming, Virtual Sports, Interactive and Leisure.

• Gaming: The segment supplies gaming terminals, gaming software and/or game content for terminals located in licensed betting offices, casinos, gaming halls and adult gaming centers, utilizing server based gaming technology to deliver content to approximately 38,000 terminals and also deploying games on terminals purchased from the company or licensed for third party platforms, with a portfolio that includes slots, roulette, blackjack and numbers games distributed via proprietary game management systems such as CORE and CORE CONNECT, and as of December 31 2025 maintained an installed base of approximately 35,000 terminals under participation based or fixed rental contracts, generating revenue of $112.3 million and adjusted EBITDA of $55.0 million for the fiscal year. The segment also generates income from the sale of terminal units, with approximately 5,500 units sold in 2025, the majority of which were destined for the United Kingdom market.

• Virtual Sports: The segment designs develops markets and distributes ultra high computer rendered simulations of sporting events such as soccer, football, basketball and horse racing, providing fixed odds wagering through a software and networking package that is offered to operators via participation based revenue sharing plus upfront software licensing integration and hosting fees, with content available in approximately 25,000 retail venues and multiple online platforms, and for the fiscal year 2025 generated revenue of $36.6 million and adjusted EBITDA of $26.8 million. The segment benefits from partnerships with major sports leagues and distributors, which enhance its content offering and market reach.

• Interactive: The segment develops and distributes interactive only content hosted on remote gaming servers, enabling online gaming operators to offer a portfolio of random number generated casino games including feature rich bonus games European style table games free spins and branded titles such as Cops nRobbers Gold Cash and the Cash bank games Wolf it Up and Big Piggy Bank through the Virgo Remote Gaming System, with notable partnerships with operators like Flutter Entain bet365 Evoke Gamesys Kaizen Betfred in Europe and BetMGM DraftKings Group Caesars FanDuel Rush Street Interactive and Loto Québec in North America, and for the fiscal year 2025 generated revenue of $58.6 million and adjusted EBITDA of $40.6 million. The segment continues to expand its library with new titles released each month, which can be quickly deployed across operator networks via its remote gaming system.

• Leisure: The segment supplies and operates gaming terminals and amusement machines in pubs, bingo halls and adult gaming centers, maintaining an installed base of approximately 5,800 terminals with about 2,800 under maintenance only contracts, generating revenue through participation based arrangements where it receives a share of gross revenue from each machine as well as from the sale of units and fixed daily fees, and for the fiscal year 2025 generated revenue of $96.6 million and adjusted EBITDA of $21.2 million. The segment focuses on delivering a lower capital intensity model by shifting from service and collection activities to primarily supplying content and machines.

Inspired Entertainment, Inc. holds a strong position in the global gaming technology market due to its established presence across multiple product verticals including gaming terminals, virtual sports, interactive content and leisure amusement machines. The company benefits from a diversified revenue base that spans geography and business lines, reducing reliance on any single market. Its competitive advantages include a substantial installed base of gaming terminals, long term participation based contracts that generate predictable recurring revenue, and a proprietary technology stack supported by approximately 25 patents and 390 trademarks worldwide. While it faces competition from larger firms with greater financial resources and some operators that have combined manufacturing and retail operations, its focus on innovation, content development and flexible distribution channels helps it maintain relevance and win contracts with major lottery betting and gaming operators. The company’s strategy emphasizes expanding into regulated North American markets and pursuing selective acquisitions to broaden its product portfolio and geographic footprint.

Inspired Entertainment, Inc. serves a diverse customer base that includes licensed lotteries, sports bookmakers, operators of gaming and bingo halls, casinos, pubs, adult gaming centers and online operators. Specific customers mentioned in the filing comprise William Hill, SNAI, Sisal, Betfred, Paddy Power, Betfair, Jenningsbet, Corbett Bookmakers, Genting, bet365, Sky Bet, OPAP, Entain, DraftKings, FanDuel, the Pennsylvania Lottery, the Alberta Gaming Liquor and Cannabis agency, the Western Canada Lottery Corporation, Moto, Welcome Break, Buzz Bingo, Mecca Bingo, JD Wetherspoon, Merkur Slots and Luxury Leisure. In addition to the listed names, the company supplies content to operators such as Flutter, Evoke, Gamesys, Kaizen and various regional lottery corporations.

Investment Thesis

▲ Bull case

The company is finalizing an internal game development studio that will start delivering new titles in the second half of the current fiscal year. By integrating artificial intelligence into the creative process the studio aims to cut the typical production cycle by several weeks. This acceleration should enable a steadier flow of fresh content to operator partners which is critical for maintaining player engagement. A stronger pipeline of exclusive games is expected to help the business gain additional market share in North America and the UK while supporting higher average revenue per user.
The retail solutions division is experiencing renewed momentum as it rolls out newer gaming machines across multiple venues in the UK and Greece. Early data shows that the win per unit per day metric climbed 11% after the introduction of the Valor Slant top cabinet. Management anticipates that this hardware refresh will continue to generate incremental revenue throughout 2026 and into 2027. Furthermore the addition of new customers Jenningsbet and Corbett s together with a multiyear contract extension with Paddy Power provides a more stable and predictable earnings base.
Through disciplined capital management the company has lowered its annualized spending from approximately forty million dollars to roughly thirty million dollars per year. At the same time headcount has been reduced by about one third which trims fixed expenses and improves operating leverage. Debt repayments combined with share repurchases have brought the leverage ratio down to three times EBITDA while free cash flow generation remains robust. The resulting margin expansion and cash generation give management flexibility to pursue strategic acquisitions or to return capital to shareholders through dividends and buybacks.
The company sees attractive growth prospects in newly regulated iGaming markets across the United States and in emerging jurisdictions such as South Africa. Recent discussions indicate that additional states may soon authorize online casino and sports betting platforms which would expand the addressable market without requiring major new infrastructure. Because the firm already operates a proven content platform and has strong relationships with existing operators the incremental cost of serving new jurisdictions is relatively low. Capturing even a modest share of these nascent opportunities could meaningfully boost interactive revenue and improve overall earnings volatility.
The deleveraging trajectory has already lowered interest expense and the company expects interest payments to decline further as debt levels continue to fall. Lower financing costs combined with rising EBITDA margins are projected to improve free cash flow conversion rates into the mid teen % range. A higher free cash flow yield enhances the capacity for shareholder returns whether through increased dividends or accelerated share repurchase programs. Investors who focus on the improving balance sheet may find the stock undervalued relative to its peers that still carry higher leverage.

The company is finalizing an internal game development studio that will start delivering new titles in the second half of the current fiscal year. By integrating artificial intelligence into the creative process the studio aims to cut the typical production cycle by several weeks. This acceleration should enable a steadier flow of fresh content to operator partners which is critical for maintaining player engagement. A stronger pipeline of exclusive games is expected to help the business gain additional market share in North America and the UK while supporting higher average revenue per user.
The retail solutions division is experiencing renewed momentum as it rolls out newer gaming machines across multiple venues in the UK and Greece. Early data shows that the win per unit per day metric climbed 11% after the introduction of the Valor Slant top cabinet. Management anticipates that this hardware refresh will continue to generate incremental revenue throughout 2026 and into 2027. Furthermore the addition of new customers Jenningsbet and Corbett s together with a multiyear contract extension with Paddy Power provides a more stable and predictable earnings base.
Through disciplined capital management the company has lowered its annualized spending from approximately forty million dollars to roughly thirty million dollars per year. At the same time headcount has been reduced by about one third which trims fixed expenses and improves operating leverage. Debt repayments combined with share repurchases have brought the leverage ratio down to three times EBITDA while free cash flow generation remains robust. The resulting margin expansion and cash generation give management flexibility to pursue strategic acquisitions or to return capital to shareholders through dividends and buybacks.
The company sees attractive growth prospects in newly regulated iGaming markets across the United States and in emerging jurisdictions such as South Africa. Recent discussions indicate that additional states may soon authorize online casino and sports betting platforms which would expand the addressable market without requiring major new infrastructure. Because the firm already operates a proven content platform and has strong relationships with existing operators the incremental cost of serving new jurisdictions is relatively low. Capturing even a modest share of these nascent opportunities could meaningfully boost interactive revenue and improve overall earnings volatility.
The deleveraging trajectory has already lowered interest expense and the company expects interest payments to decline further as debt levels continue to fall. Lower financing costs combined with rising EBITDA margins are projected to improve free cash flow conversion rates into the mid teen % range. A higher free cash flow yield enhances the capacity for shareholder returns whether through increased dividends or accelerated share repurchase programs. Investors who focus on the improving balance sheet may find the stock undervalued relative to its peers that still carry higher leverage.

▼ Bear case

Virtual sports revenue has shown little growth because gains in other regions are being counterbalanced by persistent weakness in the Brazilian market. Management concedes that the long term opportunity for virtual sports in North America is likely limited to the mid to high single digit range of online sports betting handle. Dependence on future catalysts such as the World Cup or potential lottery partnerships introduces uncertainty about timing and magnitude of any revenue uplift. Without a meaningful turnaround the virtual sports segment may continue to exert drag on overall interactive performance and impede margin expansion.
The UK interactive business faces a higher tax rate that rose from twenty one% to forty% effective April first. Although early results indicate that revenue growth has offset the immediate impact of the tax increase the sustainability of that offset remains unproven. If competitor withdrawal from the market does not continue or if player acquisition costs rise the net benefit could quickly erode. Ongoing exposure to this elevated tax environment may constrain the company’s ability to expand margins even as top line revenue advances.
The planned launch of an internal development studio in the second half of the year carries execution risk because any delay would postpone the anticipated flow of new games. The reliance on artificial intelligence to accelerate game creation is still untested at scale and may not produce the expected time savings. Should the studio fail to deliver titles that resonate with players or should AI tools prove difficult to integrate the content pipeline could stall. Such setbacks would weaken the competitive differentiation that management hopes to build in the interactive segment and could erode investor confidence.
The company’s growth narrative leans heavily on the expectation that additional U.S. states will legalize online gaming in the near term. If legislative progress stalls or if regulatory hurdles prove more severe than anticipated the addressable market may expand more slowly than projected. A slower rollout of new jurisdictions would limit the incremental revenue contribution from the interactive business and could force the firm to rely more heavily on existing markets. Overreliance on mature markets raises the risk of saturation and could constrain long term growth prospects.
Although management downplays near term macroeconomic and geopolitical risks these factors could still affect consumer discretionary spending on gaming. A prolonged period of inflation or higher interest rates might reduce the amount of money players are willing to wager online. Additionally any disruption to global supply chains could increase the cost of acquiring or maintaining gaming hardware. Such headwinds would pressure both top line growth and profitability thereby challenging the current optimistic outlook.

Virtual sports revenue has shown little growth because gains in other regions are being counterbalanced by persistent weakness in the Brazilian market. Management concedes that the long term opportunity for virtual sports in North America is likely limited to the mid to high single digit range of online sports betting handle. Dependence on future catalysts such as the World Cup or potential lottery partnerships introduces uncertainty about timing and magnitude of any revenue uplift. Without a meaningful turnaround the virtual sports segment may continue to exert drag on overall interactive performance and impede margin expansion.
The UK interactive business faces a higher tax rate that rose from twenty one% to forty% effective April first. Although early results indicate that revenue growth has offset the immediate impact of the tax increase the sustainability of that offset remains unproven. If competitor withdrawal from the market does not continue or if player acquisition costs rise the net benefit could quickly erode. Ongoing exposure to this elevated tax environment may constrain the company’s ability to expand margins even as top line revenue advances.
The planned launch of an internal development studio in the second half of the year carries execution risk because any delay would postpone the anticipated flow of new games. The reliance on artificial intelligence to accelerate game creation is still untested at scale and may not produce the expected time savings. Should the studio fail to deliver titles that resonate with players or should AI tools prove difficult to integrate the content pipeline could stall. Such setbacks would weaken the competitive differentiation that management hopes to build in the interactive segment and could erode investor confidence.
The company’s growth narrative leans heavily on the expectation that additional U.S. states will legalize online gaming in the near term. If legislative progress stalls or if regulatory hurdles prove more severe than anticipated the addressable market may expand more slowly than projected. A slower rollout of new jurisdictions would limit the incremental revenue contribution from the interactive business and could force the firm to rely more heavily on existing markets. Overreliance on mature markets raises the risk of saturation and could constrain long term growth prospects.
Although management downplays near term macroeconomic and geopolitical risks these factors could still affect consumer discretionary spending on gaming. A prolonged period of inflation or higher interest rates might reduce the amount of money players are willing to wager online. Additionally any disruption to global supply chains could increase the cost of acquiring or maintaining gaming hardware. Such headwinds would pressure both top line growth and profitability thereby challenging the current optimistic outlook.

Geographical Breakdown of Revenue (2025)

Peer Comparison

Companies in the Gambling

S.No.	Ticker	Company	Market Cap	P/E	P/S	Total Debt (Qtr)
1	CDRO	Codere Online Luxembourg, S.A.	425.84 Bn	295,184.22	1,812.57	0.00 Bn
2	FLUT	Flutter Entertainment plc	19.13 Bn	-51.01	1.12	12.14 Bn
3	DKNG	DraftKings Inc.	12.12 Bn	228.18	1.93	0.58 Bn
4	SGHC	Super Group (SGHC) Ltd	7.57 Bn	33.06	3.25	0.03 Bn
5	CHDN	Churchill Downs Inc	6.27 Bn	16.01	2.13	3.15 Bn
6	RSI	Rush Street Interactive, Inc.	3.15 Bn	35.38	2.53	-
7	BRSL	Brightstar Lottery PLC	1.94 Bn	10.92	0.77	4.01 Bn
8	ACEL	Accel Entertainment, Inc.	1.02 Bn	19.91	0.75	0.58 Bn

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Investment Thesis

Segments Breakdown of Revenue (2025)

Geographical Breakdown of Revenue (2025)

Peer Comparison

Research Tools

Developers

About

Investment Thesis

Segments Breakdown of Revenue (2025)

Geographical Breakdown of Revenue (2025)

Peer Comparison

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