Gambling.com Group reported favorable third-quarter earnings amid a seismic shift within the American affiliate industry.
The digital marketing services provider generated a quarterly record $32.1 million in Q3 2024, a 37% increase year-over-year. Gambling.com also reported considerable adjusted EBITDA growth with the company closing the quarter with an adjusted EBITDA of $12.5 million, up 108% compared to the same period last year. The Dublin-based company attributed the results to organic market share growth and growth in its casino business.
In Q3, Gambling.com reported more than 116,000 new depositing customers with its casino business generating $24.8 million in revenue during the quarter. By comparison, its casino segment posted $15.1 million in revenue in Q3 2024. On the other hand, its sports business reported $6.8 million in Q3 revenue, a 14% year-over-year decline.
“The company’s diversified market exposure and thoughtful casino-first allocation of capital set the stage for this performance and our team’s relentless focus on execution drove these results,” said CEO Charles Gillespie during the company’s third-quarter earnings call. “Our global portfolio of websites has never been better at driving high-intent traffic.”
Recent changes in the US affiliate industry
Gambling.com saw its sports segment take a step back in Q3 2024 as several major players in the U.S. affiliate industry changed their approach.
Last month, Better Collective laid off more than 300 employees after undergoing a review of the company’s operational costs. The review led Better Collective to streamline operations as a result of its more than 30 acquisitions. The cuts were 15% of its workforce.
XLMedia and Catena Media have also made organizational changes.
Catena laid off 29 employees ahead of its third-quarter earnings report in an effort to streamline its content and marketing teams. Catena expects the cuts to cost the company $423,000 but it projects to save approximately $2.3 million annually from the layoffs.
XLMedia took a different approach by fully exiting the affiliate industry by selling its remaining North American domains to Sportradar in a deal valued at up to $30 million.
Gambling.com has acknowledged the dynamic nature of America’s sports betting market.
“We grew our U.S. sports betting business from a few million to over $60 million in just a few years. We did not, however, lose sight of our core priorities. And now that growth in North America has temporarily slowed, our assets outside the U.S. have taken back the baton and continue to drive us forward,” continued Gillespie.
Gambling.com projects strong finish
As a result of its third-quarter growth, Gambling.com has raised its full-year revenue and adjusted EBITDA guidance for FY2024. The company projects revenue in FY2024 to range between $125 million and $127 million with an adjusted EBITDA of between $46.5 million and $48.5 million. Its previous guidance estimated full-year revenue to range between $123 million and $127 million with an adjusted EBITDA of $44 million to $47 million. Gambling.com’s guidance takes into consideration a cost of sales of $7.5 million for 2024.
The company is poised to benefit from a recent acquisition. In April, Gambling.com completed its acquisition of Freebets.com and related assets from XLMedia. The deal has seen the company pay a total consideration of between $37.5 million and $42.5 million. The purchase is part of a larger acquisition of XLMedia’s European and Canadian assets.
Gambling.com projects its assets from XLMedia to generate $10 million in revenue in 2024.
