Meridian Holdings Inc. (NASDAQ: MRDN) on Tuesday reported third-quarter 2026 revenue of $46.0 million, down 3% year-over-year, and a net loss attributable to the company of $13.3 million, or $(1.05) per basic and diluted share. The results, announced via NEWMEDIAWIRE, included $11.5 million of non-cash impairment charges that weighed heavily on the quarter.
The largest impairment, $5.5 million, stemmed from the full write-off of the company's Brazilian gaming license and related intangible assets after Brazil issued Provisional Measure No. 1,394/2026 on September 25, 2026, prohibiting fixed-odds betting, including online casinos, by all operators. Operators were required to take platforms offline and return player balances in early October, and existing federal authorizations were terminated 30 days after publication without reimbursement of fees already paid. Meridian suspended its Brazilian operations and does not expect to resume them during the remainder of 2026; revenue from Brazil was not material to the company.
A further $5.9 million goodwill impairment was recorded in the reporting unit holding RKingsCompetitions Ltd., the company's 80% interest in Classics Holdings Co. Pty Ltd., which owns Classics For A Cause Pty Ltd. and GMAG, following continued operating losses. After the charge, goodwill on the balance sheet stood at $3.0 million as of September 30, 2026.
Despite the loss, Meridian highlighted continued growth in its core Meridianbet Group, where nine-month revenue rose 16% to $103.8 million, led by online casino revenue up 21% to $46.9 million. Third-quarter Meridianbet revenue grew 2% to $33.1 million, with online casino up 17% to $17.1 million, new registrations up 25% to 458,680, and customer deposits up 9% to $101.1 million.
The company also reported operating cash flow of $17.7 million for the nine months ended September 30, 2026, up 3% year-over-year, which fully funded investment activities and $9.0 million in debt repayment. Total debt fell 47% to $24.1 million from a year earlier, while net debt declined 65% to $8.1 million, marking a seventh consecutive quarter of deleveraging without raising additional equity capital. Cash and cash equivalents were $16.0 million against $7.8 million of bank and other loans.
CEO Zoran Milosevic called it a challenging quarter impacted by customer-favorable sports results, regulatory developments in Brazil, and higher operating costs, including marketing around the FIFA World Cup. He noted that the core business remains healthy and continues to generate cash to drive its own growth. The company updated its full-year 2026 outlook to revenue of $195 million to $198 million, assuming no resumption of Brazil operations, and anticipates a modest increase in sports betting revenue in the fourth quarter alongside continued online casino growth.
The results matter for investors because they illustrate how regulatory shocks and impairment charges can obscure underlying cash generation. Meridian's ability to reduce debt while funding investments from operations, without diluting shareholders, may reassure stakeholders about its financial discipline even as it navigates a difficult regulatory environment in Brazil and pending changes to Australia's Interactive Gambling Act, which take effect January 1, 2027, and affect Classics for a Cause's trade promotion business model.
