Domestic gambling market faces first major growth crisis

The Ukrainian gambling market, which was legalised in August 2020, has shown significant growth in recent years. However, alongside its successes, there are also emerging challenges that may signal the first growth crisis. To determine whether we are truly experiencing such a crisis, let’s examine the key aspects of the market's development, its current economic state, and any indicators of a downturn.

Sustainable development requires a balance between state regulatory efforts, investor interest and capacity, and an active and loyal customer base. In addition, prompt law enforcement responses to illegal activities and a high level of infrastructure resilience are also essential.

Looking at the current state of the market, there appears to be a strong positive trend, particularly in the steady increase in contributions to the state budget and the consistent setting of new tax revenue records. For example, tax revenues in 2024 exceeded those of the previous year by nearly 60% (UAH 16.9 billion compared to UAH 10.4 billion in 2023). Data for the first quarter of 2025 (UAH 5.4 billion) also indicate a 20% increase compared to the same period in the previous year—and almost a 50% increase compared to January–March 2023.

The signs become clear when you start analysing not only absolute indicators of the gambling market but also the correlation between them. First of all, the difference between the total revenues of operators for different years and how many of them end the year with a profit and how many with a loss. And here we see the following: in 2024, the leading companies of the Ukrainian gambling business received 55.57 billion UAH of total revenue per year. It seems like a lot, but it is only 1% more than in 2023. Only 6 out of 10 companies finished 2024 with a profit - a total of UAH 4.34 billion. For comparison, in 2023, all 10 companies were profitable and earned UAH 7.25 billion.

There are several reasons for the current situation, but the most rational explanation is that, despite the challenges of wartime, the Ukrainian gambling industry is continuing to develop—and is now experiencing its first growth crisis. The market has shifted from a phase of rapid, expansionary growth across nearly all segments to a stage of segmentation and specialization. As a result, operators are now required to invest significantly more to establish themselves and remain competitive within these emerging niches.

This process was further complicated last year by a de facto ban on legal advertising, which coincided with the reorganisation of the national regulatory authority. These conditions temporarily increased the influence of the shadow market, whose actors, unsurprisingly, ignored the restrictions and used the opportunity to strengthen their positions in the online space—while government efforts were focused on creating a new regulatory framework. Now that the new regulator is in place and the advertising ban has been lifted, the situation is expected to gradually improve.

Overall, regulatory challenges, social risks, and economic instability are natural obstacles to the development of any market. However, the continued growth of gambling revenues and rising tax payments suggest that the crisis is not yet critical. Therefore, although the Ukrainian gambling market is facing a period of slowed growth, it still holds strong potential for further development—provided the current challenges are addressed effectively.