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Shares in Gambling.com Group dropped more than 7% after the company revised its full-year 2024 targets downwards.

Yesterday (16 May), the group posted a 9% year-on-year revenue increase to a record $29.2m for Q1 2024, reflecting growth across all geographic markets.

However, adjusted EBITDA for Q1 decreased 5% year-on-year to $10.2m, with a margin of 35%, due to higher sales costs related to media partnerships.

“The investments we have made for years in our proprietary technology, website portfolio, and accretive acquisitions are driving consistent growth,” said the group’s CEO and co-founder Charles Gillespie.

“As we continue to expand our leadership and influence across global online gambling markets and leverage the many growth drivers we have, we see a clear road ahead to generate substantially higher adjusted EBITDA and free cash flow.”

CFO Elias Mark added that the business generated year-on-year improvements in all its geographic markets, although the previous period benefitted from significantly more new US state launches.

During Q1, Gambling.com Group delivered over 107,000 new depositing customers and secured a new $50m credit facility to fund potential growth opportunities.

2024 guidance

However, the group also updated its 2024 full-year revenue and adjusted EBITDA guidance due to changes made in early May by Google in how it treats commercial content on high-authority websites.

This change has, for now, “diminished the effectiveness” of Gambling.com Group’s media partnerships.

The company now expects full-year revenue of $118m to $122m, down from the initial guidance of $129m to $133m.

Moreover, Gambling.com Group anticipates adjusted EBITDA to fall between $40m and $44m, a shift from the earlier projection of $44m to $48m.

The midpoint of the updated adjusted EBITDA outlook of $42m reflects expected year-on-year growth of 14%.

“Even with these shifts in the digital landscape, the strength and resilience of our business will enable us to deliver strong year-over-year adjusted EBITDA and free cash flow growth,” Gillespie added.

“With less competition in the search engine results pages, our owned and operated assets are better positioned for the long term than ever before.”

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