Sweepstakes growth defies **stock market** challenges for Playstudios

Playstudios bets big on sweepstakes despite regulatory hurdles and revenue dip

Playstudios, a leading social casino operator, launched its sweepstakes casino, The Win Zone, during the third quarter. Despite regulatory challenges, the company remains optimistic about the sweepstakes market.

Playstudios' co-founder, Andrew Pascal, is hopeful for the future of sweepstakes, envisioning a regulated market with oversight and taxation. The company's social offerings, including myVEGAS Slots and MGM Slots Live, have contributed to its success.

However, the road hasn't been smooth. California and Google have taken actions against sweepstakes casinos, with California banning online games and Google declassifying sweeps as social casino games. Despite these setbacks, Playstudios has seen steady improvements in The Win Zone's retention, engagement, and monetization, resulting in the highest returns on ad spend.

Critics argue that sweepstakes casinos enable real-money gambling, while operators insist they do not, and digital currency cannot be cashed out but can be redeemed for cash prizes. Playstudios has identified Latin America and certain US states as potential markets for regulated sweepstakes legislation in the future.

Playstudios reported Q3 revenue of $57.6 million, down from $71.2 million a year ago, and a net loss of $9.1 million compared to a net loss of $3.1 million in Q3 2024. Despite a 25% reduction in the total addressable stock market due to regulatory contraction, growth in the remaining open states remains strong, with an addressable market of $3.5 billion to $4 billion.