Even with the departure of big names like DraftKings and Penn over the past year, Kambi is still growing and succeeding, per its most recent earnings report. The company finished the year strong with a big Q4 buoyed by World Cup performance.
Here is a look at the top-line numbers from Kambi:
Q4 revenue of €57.8 million, up 66% YoY from €34.9 million
Q4 EBIT of €27.3 million, up 104% YoY from €13.4 million
These numbers were heavily skewed by a €12.6 million one-time termination fee from Penn Entertainment. While that one-time payment obfuscated performance, Kambi CFO David Kenyon nonetheless said the quarter was a good indicator of where Kambi’s performance is at because it was the first full year of reporting without DraftKings contributing to the bottom line. Even without the benefit of the termination fee, revenue was up 30% year over year.
“This was the first full year without DraftKings which was a major contributor last year for the first nine months of the year,” Kenyon said. “And we also had some regulatory headwinds which impacted our revenues from the Netherlands, which impacted our revenues in the first half of this year. On the flip side, we’ve had many signings in the year, we’ve launched into new markets such as Arizona, Connecticut, Louisiana, and New York online. And we have a full year of Abios revenues.”
Q4 was positively impacted by the winter World Cup as well.
“The soccer World Cup was also an important event for us during the period. Overall, player engagement was excellent with the World Cup final the highest turnover for a soccer game in Kambi’s history. However, the trade-off was a significant reduction in domestic soccer fixtures as top leagues took a mid-season break. A key World Cup highlight was the strength of our product, driven by our third-gen algorithmic trading capability, which we discussed in depth at our recent Capital Markets Day,” said Kambi CEO Kristian Nylén in the press release around the quarterly financials.
Kambi has moved that new trading capability across many new leagues since the World Cup and are pleased with its performance. The acquisition of Shape Games was also cited as a big boon to Kambi’s user-interface capailities and helped broaden the product.
The company is also happy with the expansion of its partnerships, particularly in North America. The company signed up nine new US partners in 2022 and also did a large deal with Great Canadian Gaming to help expand its footprint on the continent.
The continued partnership with Rush Street also helped with Kambi’s presence in Latin America, as the company is one of the top operators in Mexico and Colombia.
“We are already a clear market leader as I said in the Americas, but I think we need to keep and position and extend it into new markets as we roll out. And there are a few key markets more important than ours, namely Brazil, Texas, and California. Which we hope and believe will be regulated here next,” said Nylén.
Kambi recently partnered with Rei do Pitaco, the top fantasy operator in Brazil. The hope is when the country does regulate, that will position Kambi well for entry into the market.
The company also has its eye on Asia as a target for 2023.
“We need to launch in a major regulated or Asian markets. And we are looking especially at two here, Japan or India. If we are successful with drivers, we are very confident that the EBITDA target of €150 million is very achievable,” he added.