v3.25.4
Segment Reporting and Geographic Information
 12 Months Ended
Dec. 31, 2025
Segment Reporting [Abstract]  
Segment Reporting and Geographic Information

27. Segment Reporting and Geographic Information

 

Operating segments are identified as components of an enterprise for which separate and discrete financial information is available and is used by the chief operating decision maker, or decision-making group, in making decisions on how to allocate resources and assess performance. The Company’s chief decision-making group consists of the Executive Chairman and the President and Chief Executive Officer.

 

The Company’s chief decision-making group uses measures of segment profit and loss to evaluate the performance areas of 1) Achievement of revenue and gross margin; 2) Level of staff and non-staff expenses against budget; 3) Investment in capitalized software development; and 4) Additional cash expenditures impacting working capital. The decision-making group uses the information to allocate financial resources and drive operation decisions such as investing in new customers, products, geographies and refocusing commercial teams to drive new sales, accelerating or delaying staffing or other selling, general and administrative expenditures and ensuring technology staff utilization on new product development.

 

The Company operates its business along four operating segments, which are segregated on the basis of revenue stream: Gaming, Virtual Sports, Interactive and Leisure. The Company believes this method of segment reporting reflects both the way its business segments are managed and the way the performance of each segment is evaluated.

 

Other segment items consist of costs incurred in restructuring activities.

 

The accounting policies of the segments are the same as those described in the “Summary of Significant Accounting Policies.”

 

 

INSPIRED ENTERTAINMENT, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

 

The following tables present revenue, cost of sales, excluding depreciation and amortization, staff-related selling, general and administrative expenses, non-staff related selling, general and administrative expenses, labor costs capitalized, depreciation and amortization, stock-based compensation expense, other segment items, operating profit/(loss), and total capital and other long-lived asset expenditures for the years ended December 31, 2025 and December 31, 2024, respectively, by business segment. Certain unallocated corporate function costs have not been allocated to the Company’s reportable operating segments because these costs are not allocable and to do so would not be practical. Corporate function costs consist primarily of selling, general and administrative expenses, depreciation and amortization, capital expenditures, right of use assets, cash, prepaid expenses and property and equipment and software development costs relating to corporate/shared functions. Asset information by reportable segment is not given as this information is not provided to the Company’s chief decision-making group due to it not being considered necessary in order for the group to assess the reportable segments’ performance or to make decisions concerning the allocation of resources.

 

Segment Information

 

Schedule of Segment Reporting Information by Segment

Year Ended December 31, 2025

 

    Gaming    

Virtual

Sports

     Interactive     Leisure    

Corporate

Functions

     Total  
    (in millions)  
Revenue:                                    
Service   $ 88.8     $ 36.6     $ 58.6     $ 94.6     $ —     $ 278.6  
Product sales     23.5       —       —       2.0       —       25.5  
Total segment revenue     112.3       36.6       58.6       96.6       —       304.1  
Cost of sales, excluding depreciation and amortization:                                                
Cost of service     (20.6 )     (2.1 )     (2.9 )     (44.6 )     —       (70.2 )
Cost of product sales     (15.4 )     —       —       (0.9 )     —       (16.3 )
Staff-related selling, general and administrative expenses     (16.1 )     (9.3 )     (11.2 )     (15.4 )     (17.7 )     (69.7 )
Non-staff related selling, general and administrative expenses     (11.7 )     (2.1 )     (6.9 )     (14.6 )     (14.5 )     (49.8 )
Labor costs capitalized     6.5       3.7       3.0       0.1       —       13.3  
Stock-based compensation expense     (1.2 )     (0.4 )     (0.7 )     (0.5 )     (3.9 )     (6.7 )
Depreciation and amortization     (24.0 )     (7.8 )     (5.2 )     (12.5 )     (2.9 )     (52.4 )
Loss on sale of business     —       —       —       (6.6 )     —       (6.6 )
Other segment items     (2.2 )      —       —       (0.5 )      (12.5 )     (15.2 )
Segment operating income (loss)     27.6       18.6       34.7       1.1       (51.5 )     30.5  
                                                 
Net operating income                                           $ 30.5  
                                                 
Total goodwill at beginning of period   $ 12.0       44.0       1.8       20.5       —       78.3  
Accumulated goodwill impairment losses     —       —       —       (20.5 )     —       (20.5 )
Total goodwill at beginning of period, net     12.0       44.0       1.8       —       —       57.8  
Foreign currency translation adjustments     0.9       3.3       0.1       —       —       4.3  
Total goodwill at December 31, 2025, net   $ 12.9     $ 47.3     $ 1.9     $ —     $ —     $ 62.1  
Total capital and other long-lived asset expenditures for the year ended December 31, 2025   $ 29.2     $ 3.5     $ 1.1     $ 7.7     $ 5.1     $ 46.6  

 

Year Ended December 31, 2024

 

    Gaming    

Virtual

Sports

     Interactive     Leisure     Corporate Functions     Total  
    (in millions)  
Revenue:                                    
Service   $ 74.7     $ 45.4     $ 39.3     $ 99.2     $ —     $ 258.6  
Product sales     35.9       —       —       2.6       —       38.5  
Total revenue     110.6       45.4       39.3       101.8       —       297.1  
Cost of sales, excluding depreciation and amortization:                                                
Cost of service     (20.0 )     (1.7 )     (1.7 )     (46.9 )     —       (70.3 )
Cost of product sales     (21.2 )     —       —       (0.8 )     —       (22.0 )
Staff-related selling, general and administrative expenses     (18.1 )     (9.2 )     (8.9 )     (16.8 )     (12.5 )     (65.5 )
Non-staff related selling, general and administrative expenses     (10.5 )     (2.7 )     (5.4 )     (14.8 )     (17.6 )     (51.0 )
Labor costs capitalized     4.5       4.3       2.3       0.8       —       11.9  
Stock-based compensation expense     (0.9 )     (0.5 )     (0.4 )     (0.6 )     (5.2 )     (7.6 )
Depreciation and amortization     (16.8 )     (5.6 )     (5.5 )     (12.9 )     (2.5 )     (43.3 )
Other segment items     (3.7 )     —       —       —       (14.9 )     (18.6 )
Segment operating income (loss)     23.9       30.0       19.7       9.8       (52.7 )     30.7  
                                                 
Net operating income                                           $ 30.7  
                                                 
Total goodwill at beginning of period   $ 12.2       44.8       1.8       20.5       —       79.3  
Accumulated goodwill impairment losses     —       —       —       (20.5 )     —       (20.5 )
Total goodwill at beginning of period, net     12.2       44.8       1.8       —       —       58.8  
Foreign currency translation adjustments     (0.2 )     (0.8 )     —       —       —       (1.0 )
Total goodwill at December 31, 2024, net   $ 12.0     $ 44.0     $ 1.8     $ —     $ —     $ 57.8  
Total capital and other long-lived asset expenditures for the year ended December 31, 2024   $ 9.4     $ 9.6     $ 1.7     $ 11.5     $ 4.3     $ 36.5  

 

 

INSPIRED ENTERTAINMENT, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

 

Geographic Information

 

Geographic information for revenue is set forth below:

 

Schedule of Geographic Information

    Year Ended
December 31,
2025		     Year Ended
December 31,
2024		  
    (in millions)  
Total revenue                
UK   $ 209.7     $ 217.0  
Greece     27.1       21.3  
Rest of world     67.3       58.8  
Total   $ 304.1     $ 297.1  

 

UK revenue includes revenue from customers headquartered in the UK, but whose revenue is generated globally.

 

Geographic information of our non-current assets excluding goodwill is set forth below:

 

    December 31,
2025		     December 31,
2024		  
    (in millions)  
UK   $ 110.9     $ 115.1  
Greece     23.8       12.7  
Rest of world     19.8       25.5  
Total   $ 154.5     $ 153.3  

 

Software development costs are included as attributable to the market in which they are utilized.