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Online gaming SaaS provider GAN has released its financial results for the third quarter of 2021, showing a quarter-over-quarter decrease in revenues of 5.8%, and widening losses.

Total revenues for the quarter came to $32.3m, down 5.8% on Q2 2021, and consisted of $21.1m from the business’ B2C offerings and $11.2m from B2B.

Europe was GAN’s largest market by revenue, bringing in $11.6m. This was followed by Latin America, the US, and the rest of the world, which brought in $9,9m, $9.1m and $1.7m, respectively.

In the business’ B2C segment, GAN made a gross profit of $13.9m on its $21.1m revenue, after paying a cost of revenue of $7.2m. Revenue for the segment was down 12.0% on a quarter-over-quarter basis, while gross profit was down 12.9%.

In the B2B segment, revenue was up year-on-year and quarter-over-quarter by 8.8% and 4.9%, respectively.

The cost of revenue for B2B was $3.6m, leaving a gross profit for the segment of $7.6m.

This gave a gross profit across both segments of $21.5m, at a gross profit margin of 67%.

Total costs, however, came in at $27.8m for the quarter, including $12.9m in general and administrative costs, $5.7m in sales and marketing expense, and $4.6m each in product and technology, and depreciation and amortisation costs.

This left the business with an operating loss of $6.4m, compared to a $2.9m operating loss in Q3 2020 and a $1.7m operating loss in Q2 2021.

After $1.5m in income tax provision, the business declared a net loss of $7.9m for the quarter, compared to a $2.9m net loss in Q3 2020 and a $2.7m net loss in Q2 2021.

GAN’s chief executive, Dermot Smurfit, said: “Our third quarter financial results were in line with our expectations as our B2B segment revenues rose 5% compared to the prior quarter, while our B2C revenues experienced seasonality following a record second quarter.” 

“We added the iconic Treasure Island Hotel & Casino to our growing list of SIM clients during the quarter, and continued to demonstrate the value of our ‘multi-state, one app’ capability as we launched Churchill Downs’ online sports betting operation in Arizona.”

Smurfit said the business had also built upon its existing relationship with FanDuel, helping deliver the operator’s iGaming platform in Connecticut following the end of the quarter.

He continued that the business’ strategy “will ultimately yield over $500 million of revenue by 2026 and a long-term Adjusted EBITDA margin of 30-35% at scale.” 

“We continue to make exciting progress in each of our business segments and initiatives and are well-positioned going forward,” Smurfit concluded.

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