A Tough Year for Sweden’s Betting Leader

Sweden’s state-linked betting heavyweight AB Trav och Galopp (ATG) has reported a difficult 2025, as weaker consumer spending and higher taxes squeezed margins from both ends.

The operator’s latest financial report shows revenue down 2% to SEK 5.2 billion (approximately $490 million). On the surface, the dip looks manageable. Deeper in the figures, however, the strain becomes clear.

Operating profit fell 15% year-on-year to SEK 1.5 billion ($141 million). The company’s operating margin slipped from 29% to 26%, reflecting higher costs against a softer revenue base.

Tax Increase Takes Its Toll

Much of the pressure stems from Sweden’s 2024 decision to raise gambling tax from 18% to 22%.

That four-point increase translated into a significant financial hit:

  • SEK 216 million ($20 million) additional tax burden
  • Total gambling tax payments reaching SEK 1.3 billion
  • A 7% rise in taxes despite lower overall revenue

For ATG, the arithmetic is unforgiving: declining player spend combined with higher statutory obligations.

Consumer Behavior Shifts in a Recession

The 2025 results also offer insight into how Swedish consumers are adjusting their gambling habits during economic uncertainty.

Casino Revenue Falls Sharply

The online casino segment dropped 7%, making it the weakest-performing vertical. Discretionary spending on slots and instant-win games appears to be among the first cutbacks for households under financial strain.

Sports Betting Softens

Sports wagering revenue declined 2%, a modest contraction compared to casino.

Horse Racing Shows Resilience

Horse racing, ATG’s core product, fell just 1%. The figures suggest a loyal customer base remains engaged even as casual players retreat.

ATG continues to serve around 1.4 million active customers, reinforcing the brand’s entrenched position in Sweden’s betting landscape.

Ripple Effects on Swedish Racing

The implications extend beyond corporate performance.

ATG plays a central role in funding Sweden’s horse racing ecosystem. Reduced profitability directly affects:

  • Prize pools for races
  • Track maintenance budgets
  • Financial support for owners and breeders

When betting margins tighten, funding for the sport contracts accordingly. Management acknowledged the risk, warning that sustained pressure could weaken the broader racing industry.

Defensive Mode in 2026

With recessionary headwinds lingering and tax rates locked in at 22%, ATG appears to be entering a defensive phase. Cost control and margin protection will likely dominate its strategy heading into the next earnings cycle.

The company’s next update in April will offer a clearer view of whether stabilization is possible — or whether Sweden’s largest gambling operator faces a prolonged squeeze.

Summary

ATG’s 2025 results highlight the combined impact of Sweden’s gambling tax increase and reduced consumer spending. Revenue declined modestly, but operating profit dropped 15% as higher tax payments eroded margins. While horse racing remains resilient, weaker casino performance and mounting fiscal pressure raise concerns not only for ATG’s balance sheet but also for the future funding of Swedish racing.