Q3 2023: Gambling.com Group US growth drives 19% revenue increase
The North American segment drove overall revenue growth, with the segment posting a 42% revenue increase to $12.9m.
The segment also represented a larger proportion of overall revenue than it had in the past. In Q3 2023 North American revenue accounted for 54.9% of the total, up from 46.4% in the prior year.
“Third quarter North American revenue… includes significant growth in our owned assets and a break-out performance from our media partnerships at the start of the fall sports season,” said CEO Charles Gillespie.
The reported Q3 revenue exceeded expectations while adjusted EBITDA for the period was in line with expectations, said CFO Elias Mark.
Profit rises despite EBITDA decline
In Q3, the business reported a 6% decline in adjusted EBITDA to $6.1m. The company’s EBITDA margin also fell from 33% to 26%.
Nevertheless, Gambling.com’s operating profit grew from $156,000 in Q3 2022 to $4.7m.
Due to significant non-operating financial income during the period, the group’s overall net income jumped 122% year-on-year to $5.0m.
In terms of non-financial metrics, the number of new depositing customers referred by Gambling.com rose 26% to over 86,000.“Our ability to quickly scale our strategic media partnerships complements the growth from our influential owned websites,” said Gillespie.
“This results in consistent year-over-year market share gains in existing states even as we face tougher comparisons given the significant organic growth we have already achieved.”
Gillespie also highlighted the UK and Ireland as a potential growth market. In support of this, the executive pointed to the previously announced partnership with The Independent newspaper.
The deal – announced in July – represented the affiliate’s first non-US partnership. Gillespie has in the past been bullish on the prospects of growth in the European markets.
Gambling.com said it expected its media partnerships to be a key contributor to revenue and cash flow growth going forward.
Despite this seemingly rosy picture, Gambling.com saw its shares slump 12.7% to $12.19 when markets opened on 16 November.
This pattern repeated with Gambling.com’s competitor in the North American affiliate space Better Collective, which today saw shares fall 17.2% despite posting a 26% rise in revenue.
Gambling.com reiterated its previous FY2023 guidance, announcing that it expects revenue to fall between $100m-$104m. This implies an organic revenue growth rate of 31%-36%.
The company added that it expects adjusted EBITDA to stand at $36m-$40m, assuming no further acquisitions.
In 2023 Gambling.com was much quieter on the M&A front than some of its competitors.
However, the business spent a great deal of energy launching its new brand Casinos.com, which it has committed to providing further investment for.