IG Group (IGG) Investor update summary

Strategic rationale

• Underdog adds a high-growth product adjacency, broadens the customer base and diversifies U.S. growth and product mix.

• Pro forma U.S. revenue rises to £596m from £206m standalone, increasing the U.S. share of revenue from 19% to 41%.

• Prediction markets and DFS represent 27% of combined revenue; largely uncorrelated streams are expected to diversify products and reduce short-term variability.

• The deal is expected to meet the M&A return framework, accelerate growth and support medium-term growth of at least double digits.

Trading and customer trends

• Organic active customers grew 17% YoY; OTC revenue retention averaged 80% after July 2025 measures through Q3 2026, with potential to improve further.

• Q3 net revenue was $105m, up 118% YoY, with $1,075m handle and estimated average monthly active users of 705k; 2026 YTD net revenue was ~$355m, up 30%.

• Q3 monthly actives rose 13%, handle per customer 165% and deposits per customer 109%; Q3 actives were also reported up 118% YoY.

• Q3 results benefited partly from the sporting calendar, including the World Cup, and a softer comparison after an unusually weak margin period a year earlier.

• Q3 trading outcomes were disappointing due to customer positioning but within modeled scenarios; marketing spend was down over 30% YTD during the product rebuild, with strong early NFL engagement.

Underdog product and operating momentum

• Net revenue grew from $9m in 2021 to $441m in 2025; Underdog has over 5.5m deposited customers.

• Fantasy Pick’em was limited to player picks in ~36 states; prediction markets expand the core sports experience to 46 states under the CFTC.

• Underdog secured FCM capability and DCM/DCO licenses in H1 2026, launched UDX in July and integrated Kalshi via FCM in September 2026; it is the only sports-first operator live with an FCM, DCM and DCO.

• One app combines fantasy sports, prediction markets, UDX, other FCM-connected DCMs and games; its orchestration layer routes orders across venues while keeping the experience in one app, account and wallet.

• Crash and Rips launched after the deal announcement, Supercharge was planned for October, and early signs show cross-sell in both directions for new games.