Evolution AB Faces Allegations of Operating in Banned Markets

In a significant development for Stockholm-based Evolution AB, a gaming company known for its fully integrated B2B live casino solutions, allegations have surfaced regarding its operations in markets where gambling is either banned or under U.S. sanctions. This news has sent ripples through the Consumer Discretionary sector, particularly within the Hotels, Restaurants & Leisure industry, where Evolution AB holds a strong presence.

Allegations and Legal Proceedings

According to reports from Bloomberg News and filings submitted to a New Jersey court, Evolution AB is accused of delivering casino games to countries such as Iran, Sudan, and China, where gambling is prohibited or under U.S. sanctions. These allegations are based on secret recordings captured by the private intelligence firm Black Cube, which reportedly feature current and former executives of Evolution AB discussing the illegal distribution of their casino games to these markets.

Market Reaction and Company Response

Despite the limited new information provided by Bloomberg News, the market anticipated a negative reaction to these allegations. Citi, in a brief comment, noted that a downturn in Evolution AB’s stock price was expected. As of August 11, 2025, Evolution AB’s stock closed at 885.4 SEK, having experienced a significant drop from its 52-week high of 1,096.25 SEK on October 23, 2024, to a low of 639.4 SEK on May 22, 2025. The company’s market capitalization stands at 181,030,839,954 SEK, with a price-to-earnings ratio of 13.52.

In response to these allegations, Evolution AB has vehemently denied any wrongdoing. The company has labeled the accusations as “false and defamatory,” emphasizing its lack of interest in operating in markets where its games are not permitted. Carl Linton, Evolution’s IR chief, stated that the company is committed to preventing its games from being available in unauthorized markets.

Regulatory and Market Implications

The allegations have prompted Nasdaq to declare stressed market conditions in derivatives on Evolution AB for four hours, pending a reassessment of market conditions. This move underscores the potential regulatory and financial implications for Evolution AB, as it navigates these serious allegations.

Looking Forward

As Evolution AB faces these challenges, the company’s future actions and the outcome of the legal proceedings will be closely watched by investors and industry observers. The allegations not only pose a risk to Evolution AB’s reputation but also highlight the broader challenges faced by companies operating in the global online gambling industry, where regulatory environments vary significantly across jurisdictions.

In conclusion, while Evolution AB has denied the allegations and expressed its commitment to compliance, the situation underscores the importance of stringent regulatory adherence and the potential consequences of operating in restricted markets. The coming weeks and months will be crucial for Evolution AB as it seeks to address these allegations and restore confidence among its stakeholders.