GVC Holdings, which owns Ladbrokes, said it expects profits to be cut by about £160m (US$215m) in the first year that the new limit is in force.
"These machines are a social blight and prey on some of the most vulnerable in society, and we are determined to put a stop to it and build a fairer society for all", Matt Hancock, Secretary of State for Sport, said in a statement.
The measure, which requires parliamentary approval, is being taken for the controversial Category B2 machines following a consultation involving the public and the gambling industry.
The government announced this morning that the maximum stakes on fixed odds betting terminals are to be cut from £100 to £2 to clamp down on the risk of "gambling-related harm".
"It is a pity they took quite this long to come to a decision, but each and every move is welcome if it means we do something to tackle the issue of problem gambling which causes difficulties and hardships for so many families".
The cross party group of MPs and Peers, published a report in January 2017, assessing the impact of FOBTs, and called for a substantial reduction in the maximum stake playable, stating that there was a strong case for this to be no more than £2. We are increasing protections around online gambling, doing more on research, education and treatment of problem gambling and ensuring tighter rules around gambling advertising. "Today's move will have a short-term impact on our business, but we think it's a really important step towards building a sustainable industry". The decision is a victory for campaigners against the excesses of the gambling industry, including a number of Christian groups.
The campaign has secured the widespread support with the General Synod of the Church of England, 93 local authorities, the Royal Society for Public Health and politicians from all parties supporting the campaign.
The age limit for playing National Lottery games will also be reviewed as part of the next licence competition, with the government saying it was needed to take into account "developments in the market and the risk of harm to young people".
Changes to the stake will be through secondary legislation.
Changes to the stake will need to be brought through leglislation and will need to be approved by parliament.
September's Betting on Sports conference will be looking at the situation in the Betting on Retail track at a session entitled: New Reality - Adapting to the post-FOBT landscape.
Stakes of up to £100 could be placed in quick succession. What is in the pipeline?