BetMGM has lowered its full-year 2026 revenue guidance after a weaker-than-expected first quarter in its online sports betting division, the company announced in its Q1 results.
The joint venture between MGM Resorts International and Entain now projects full-year net revenue of between $2.9 billion and $3.1 billion, down from its previous guidance of $3.1 billion to $3.2 billion. Despite the revenue downgrade, the company maintained its adjusted EBITDA guidance of $300 million to $350 million, though it indicated it expects to come in at the lower end of that range.
BetMGM generated $696 million in net revenue in Q1 2026, a 6% increase year-over-year. The growth was split between its two main business lines: online sports betting revenue rose 4% to $203 million, while iGaming revenue climbed 9% to $481 million. Adjusted EBITDA for the quarter reached $25 million, up from $22 million in the same period last year.
The company cited two primary factors behind the revenue shortfall in its sports betting segment. First, bettor-friendly outcomes weighed on margins, with unfavourable results accounting for approximately 60 basis points of margin drag. Second, customer acquisition costs rose materially during the period. According to CEO Adam Greenblatt, a significant portion of the increased acquisition cost pressure stemmed from companies positioning themselves as “prediction markets” bidding on sports betting keywords and purchasing sports media advertising, which in turn drove up the cost of acquiring new customers and extended payback periods.
In response, management said BetMGM plans to reduce marketing spend in online sports betting-only states and redirect capital toward markets where it holds stronger competitive positions, including multi-product states where iGaming is also available, Nevada, and markets with higher-value players.
Q1 2026 represented a full major-event calendar, encompassing the NFL playoffs, Super Bowl, the Winter Olympics, and March Madness, yet sports betting still delivered only modest year-on-year growth. BetMGM held a 13% gross gaming revenue market share across its 23 online sports betting states and four online casino jurisdictions.
On the capital side, the company for the first time paid a parent fee, amounting to $3 million distributed to MGM Resorts and Entain. In 2025, BetMGM returned $270 million to its parent companies. Greenblatt indicated that cash distributions to parent companies in Q1 2026 would be limited to the parent fee due to seasonal factors including elevated marketing spend around major sporting events and annual compensation payouts.
Looking further ahead, management reiterated a target of $500 million in adjusted EBITDA in 2027. Growth drivers cited for the remainder of the year and into 2027 include the 2026 FIFA World Cup, improvements to in-play trading capabilities, the launch of online sports betting and iGaming in Alberta in July, and continued omni-channel development in Nevada.
Image: Sarah Stierch (CC BY 4.0)