Recasts, adding size of online betting drop in paragraph 1, shares in paragraph 2, prediction markets context in paragraphs 7-8, and chart illustrating share performance since market debut.

By Javi West Larrañaga

May 21 (Reuters) - Blackstone-backed Spanish gambling company Cirsa's CIRSA.MC first-quarter core earnings rose about 8%, it said on Thursday, although increased gaming taxes in Peru knocked profits from its online betting business 12% lower.

Shares in the company, which operates casinos, gambling platforms and slot machines in Spain, Latin America, Italy, Morocco and Portugal, fell as much as 2.9% in early trading.

Cirsa reported earnings before interest, tax, depreciation and amortisation of €193.9 million ($225.3 million) for the quarter, up from €178.8 million in the same period last year. Aside from online betting, earnings grew across its business units.

The company reiterated its 2026 outlook and said it was fully on track to meet the high end of its core earnings target range of €800 million to €820 million.

Cirsa was listed in July 2025 by private equity giant Blackstone BX.N but it has failed to gather steam, shedding about 11% of its value since then. Blackstone kept a 78% stake in Cirsa after the listing.

Despite fears that traditional betting platforms could face increasing competition from prediction markets such as Polymarket and Kalshi, Cirsa said in February that its operations remained unaffected, while adding it did not expect any impact going forward either, given the current regulatory frameworks.

Growing numbers of customers use prediction markets to bet on the outcome of events such as the date of the potential peace deal between the U.S. and Iran or whether Rihanna's next album will be released before the widely expected "Grand Theft Auto VI" video game.

($1 = 0.8605 euros)