Key Takeaways:
- Unlicensed operators forecast to exceed £1 billion in UK gambling ad spend by 2028.
- Licensed UK operators to reduce advertising spend 9.2% to £1.05 billion in 2025-26.
- Westminster Hall debate on gambling advertising scheduled for April 23.
Crossover point arrives as the Gambling Commission is mid-leadership transition
WARC’s analysis projects unlicensed gambling ad spend will grow from £844.7 million in 2025-26 to £934.2 million in 2026-27, exceeding £1 billion by 2028. Regulated UK operators, by contrast, are forecast to cut advertising budgets by 9.2% in the 2025-26 period and by a further 2.6% to £1.022 billion in 2026-27.
“While ad spend within the UK’s gambling sector is set to rise to £1.9bn this year, WARC research has found that there is a two-speed market at play, with almost all growth now being driven by unlicensed firms,” the advertising intelligence firm explained in its research statement. “These operators are predominantly based overseas and are paying ever-increasing amounts to reach UK consumers online via search and social media.”
WARC characterized the projected 2028 overtake as “a sign of the tectonic shift currently occurring within the market.” The research also flagged a faster crossover in sponsorship spending. WARC projects unlicensed operators will account for more than half of gambling sponsorship ad spend as early as the 2026-27 period.
Overall gambling sponsorship outlay has grown from £158 million in 2019-20 to a projected £260 million in 2026-27, with regulated firms’ share peaking in 2021-22 and declining since. The Betting and Gaming Council, the UK gambling industry’s standards body and trade association, which carried the research on its site, responded through chief executive Grainne Hurst, who described the findings as a “tipping point where illegal operators overtake licensed firms in advertising spend, fundamentally reshaping what consumers see.”
In a statement accompanying the research, Hurst said the shift “should ring alarm bells in Westminster,” adding: “The real question is whether advertising is coming from regulated operators, who are held to strict standards, or from the harmful, illegal black market, which operates entirely outside the rules.”
Hurst argued that further restrictions on licensed operators would accelerate rather than contain the shift. “Targeting licensed operators when their advertising spend is already falling will not reduce overall advertising; it will simply bolster the harmful illegal black market, which is aggressively targeting UK customers,” she said. “The government must go further and faster to clamp down on the black market before it is too late.”
The research lands amid significant regulatory pressure on UK licensed operators. The Remote Gaming Duty rose from 21% to 40% on April 1, and the Remote Betting Duty is scheduled to increase from 15% to 25% from April 2027. The Office for Budget Responsibility estimated in November 2025 that the tax changes would drive approximately £500 million in additional gambling activity to the black market, alongside broader yield reductions from demand substitution and operator price pass-through. The tax changes compound an ongoing dispute over proposed affordability checks, which the BGC has similarly warned would push customers toward unregulated operators.
Separate research from the Campaign for Fairer Gambling and Yield Sec, published in January 2026, estimated that unlicensed operators already account for roughly 9% of the £8.2 billion UK online gambling market. Chris Sanger, EY’s Global Government Tax Leader, told a BGC industry event this year that the illegal market had grown from 0.5% of the legal market “a few years ago” to 10-12% today.
The UK Gambling Commission is navigating the mid-transition shift, with chief executive Andrew Rhodes set to step down on April 30 and deputy Sarah Gardner assuming the acting CEO role. The government committed an additional £26 million to the Commission’s black market taskforce in the November 2025 budget. Thursday’s Westminster Hall debate is expected to focus on how the regulated advertising framework should respond as the unlicensed share of spend expands.
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