Australia’s gambling market is worth some $15 billion annually. Many of of the world’s biggest publicly listed gambling operators like Flutter Entertainment and Entain have exposure to it, and there are large domestic operators too like Tabcorp and PointsBet that are traded on the ASX. However, the sector is potentially entering a new phase.
Recently, Antony Albanese’s Labor government has announced sweeping gambling advertisement reforms, that will ban or heavily restrict gambling ads in various contexts from sports stadiums to social media.
As of this week, Aussie gambling operators TabCorp, Betr and PointsBet have all seen shares fall significantly since the news dropped.
The Ad Crackdown and the Direct Effects
The new ad reform is wide-ranging. Gambling operators and politicians across the spectrum are already calling for clarification before it takes effect in 2027.
The plan is to completely ban gambling advertising in sports venues, as well as on social media platforms where users are not confirmed to be 18. It will also ban celebrities and sports players from participating in gambling ads (details as yet unclear) and will limit adverts on the radio and TV during certain hours
Podcasts are also affected, which are big business among younger audiences. Sports podcasts in particular often have gambling ads or sponsors. If they want to continue to do so, they’ll need to be age gated on platforms first.
Australians have the highest per capita gambling spend in the world, at $34 billion wagered. One government survey suggested that annual spend could fall by around $62 million a year due to the changes – although that is only around 0.8% of the total spend.
International operators like Flutter and Entain are able to stomach these costs, and investors know global diversification reduces risk. So their share prices reacted less to the news.
For example, the largest local bookmaker Tabcorp’s shares are down 5.5% in the past month. Meanwhile Entain has remained steady and is currently 3.45% up over the same period.
This is, it must be said, early days. The actual implementation of the ban could be a year away, and local operators are already feeling the pinch.
Sports Leagues and Gambling Auxiliary Businesses Could Also Take a Hit
Australian gambling operators currently spend $155 million a year on ads. If the rules take effect as they are now, a lot of that will dissapears overnight. Which could well hit big digital media marketing businesses in the country hard.
For example, gamblers often look to third party comparison sites for unbiased reviews of online casinos in New Zealand and Australia. These sites let players assess their options in a crowded regional market, with a lot of different bonuses, games and other features available.
Sites offering this kind of service could well have to change how they do business in Australia, when the new regulations come in – and that could also mean lost revenue.
Another example is sports leagues. Some one million individual adverts a year will be banned or restricted under the new rules – and a lot of them will come from sports teams and stadiums.
The AFL’s Brisbane Broncos are already a volatile stock, falling 16% in one month in late 2025, so any lost revenue from gambling sponsorships could hit them hard.
Typically, these aren’t ASX traded companies but the sports market is huge so any losses there can have knock on effects on consumer spending elsewhere.
Outlook
The public and politicians are well aware of Australia’s high per capita gambling spend – and the population has been polled that it overwhelmingly supports restrictions. The Government initially proposed even tougher measures, which were successfully campaigned against by the gambling business.
But all of that suggests this isn’t the last of tightening regulation on the gambling business. Given that operators share prices have already shown volatility after initial announcements, if the rules are rolled out exactly as planned expect further losses in early 2027.
The most likely case is that Flutter (although facing its own problems with US dominant FanDuel) and Entain are likely to hold firm given their international market diversification. However, operators like PointsBet and Tabcorp may well see investors feeling less confident throughout the year.
Bull Case
- Clarification is still needed on some issues, which, if favorable to operators, could soften the blow
- Australians high demand for betting carries the market with minimal loss in spend despite restrictions
- A shift away from traditional advertising could spark a boom in in-house marketing channels (CRM and loyalty tech)
- International operators can weather the storm due to diversified risk – increasing their market share
- Regulation can lead to a more stable long term market, benefitting long investors
Bear Case
- Advertising restrictions come into force in 2027 as they are now, and operators lose around 1% of market overnight
- Smaller local operators see shares fall drastically, as their focus on aggressive promotions loses investor confidence
- Even international operators face global regulatory concerns, adding pressure across markets
- Broader trends including the cost of living pressures contribute to a cycle of decreased gambling spend
- Operators could cut promotions and tighten odds leading to an exodus to untaxed and unregulated offshore platforms
