Gambling.com Q3 revenue climbs over $10m in first report since public listing

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Gambling.com Group has released its financial results for the third quarter of 2021, its first interim report since listing on the Nasdaq earlier this year.

Total revenues came to $10.1m for the period, up 36.7% year-on-year, and consisted of $4.5m from the UK and Ireland, $2.7m from the rest of Europe, $2.3m from North America, and $652,000 from the rest of the world.

The UK and Ireland showed a modest growth rate of 4.0%, while rest of world revenues declined 23.5% year-on-year.

Meanwhile, revenue from other European markets and North America skyrocketed, with Europe experiencing growth of 133.9% and North American revenue up 110.0% year-on-year.

Gambling.com said the overall revenue increase was primarily driven by organic growth in these markets.

Charles Gillespie, co-founder and chief executive of Gambling.com Group, commented: “Importantly, after the quiet summer months of July and August, we delivered all-time-high revenue in September.” 

“With the launch of Arizona and the kickoff of the NFL season, we saw a significant uplift in US revenue in September and our US performance exceeded our internal expectations.”

By revenue type, the majority, $5.5m, came from cost-per-acquisition (CPA) agreement commissions, with hybrid agreements bringing in the next largest revenue segment, at $2.8m. 

CPA revenue grew by 115.2%, while hybrid agreements brought in 27.0% less than in Q3 2020.

Other revenues totalled $1.0m, up significantly from just $230,000 in Q3 2020, while revenue share commission increased slightly – from $794,000 to $829,000.

By vertical, casino continued to bring in the lion’s share of revenue, at $8.0m, or 78.7% of the quarterly total. Sports betting generated a further $2.1m, or 20.5% of revenue.

Sports grew significantly faster than casino, however, bringing in 142.0% more than in Q3 2020, when betting revenue came in at just $858,000, or 11.6% of total revenue.

Other revenue was down at $82,000, compared to $194,000 in the same period last year.

Total operating expenses for the quarter came to $7.7m, almost double the $3.9m expenses registered in Q3 2020.

This consisted of $3.6m in sales and marketing expenses, $1.1m in technology expenses, $3.0m in general and administrative costs and a $34,000 allowance for credit losses and write offs.

Gambling.com said the increased costs were driven primarily by increased headcount across several of its departments, as well as the increased administrative expenses associated with operating as a public company.

Adjusted EBITDA for the period was down against Q3 2020, coming in at $3.5m, compared to $4.0m in the prior year. This gave the business an EBITDA margin of 34% for the period. 

The decrease was driven primarily by increased operating expenses, but was partly offset by the increase in revenues, Gambling.com said.

Operating profit for the period was also down, at $2.4m compared to $3.5m in Q3 2020. 

Net income for the period, however, more than doubled compared to Q3 2020, totalling $4.7m, up from $2.3m.

The business said this was primarily driven by the recognition of deferred tax assets related to transferred intangible assets.

The business’ financial targets for 2021-2023 include total revenue growth of an average of 40% year-on-year, as well as an adjusted EBITDA margin of 40% on average.

“Our third quarter results came in a bit above our expectations and after slow summer trading our financial performance accelerated in September to close out the quarter with the best month in the Company’s history,” said Elias Mark, chief financial officer of Gambling.com Group 

“Our Adjusted EBITDA margin of 34% in the quarter was healthy despite a seasonally slow quarter and investments in scaling the organisation for organic growth initiatives and operating as a public company. This is consistent with our prior guidance that our near-term margins may deviate from our average 40% target as we invest in our organic growth plan and pursue our M&A strategy.” 

“For the full year, we are reiterating our expectation to achieve both above 40% year-on-year organic revenue growth and approximately 40% Adjusted EBITDA margin. We remain in a very strong financial position after the IPO last quarter which offers us significant optionality going forward to execute our growth plan and each of our capital allocation priorities,” Mark concluded.

About the author

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Conor Mulheir

Conor entered the gaming industry in 2018 producing high-level live event content for audiences in London, Amsterdam and São Paulo. From 2020, he went on to report news and commission exclusive content for various gaming media brands before joining iGaming NEXT as editor in January 2022.

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