Kambi’s sales increased to €42.9m (£36.8m/$47.5m) from €34.7m in Q2 2022. This lifted H1 revenue to €86.9m, up from €71.5m last year.
“The second quarter of the year was another encouraging period for Kambi as we made significant strategic progress towards executing our long-term growth strategy, including a tier-one partner signing, key partner renewals and the continued development of our AI trading capability,” Nylén said.
Bally’s opportunities
The importance of a partnership with Bally’s Corporation in Q2 was also underlined.
“From a commercial perspective, we were delighted to welcome Bally’s Corporation to the Kambi network in Q2,” Nylén said. “As we further solidify our market leadership position, this partner win is a major milestone for the business and comes on the back of our flexible product strategy.
“As one of the world’s leading gaming operators, Bally’s commands strong brand recognition, a large customer database and expansive global footprint that has the potential to open up significant opportunities for Kambi in both the US and beyond.”
Nylén later said in his presentation that the partnership opened up growth opportunities in “Europe, Asia and possibly Latin America going forward”.
More broadly, Nylén added that there was “very strong momentum, headlined by the Bally’s signing”. He added that the “sales pipeline is still very strong” and the company is making “significant progress” towards its 2027 growth targets.
Shape Games
Quarterly operating profit was €3.7m, down from €4.9m year-on-year, and €8.2m for H1 – a 33.0% decline on €12.2m yearly.
Earnings before interest, tax and amortisation (EBITA) was €5.0m, a fall of €0.2m year-on-year. This was partly due to recurring additional operating expenses of €2.9m relating to Shape Games.
Shape Games was acquired for an initial €38.5m last September. The front-end technology specialist contributed revenue of €3.2m in the quarter, according to chief financial officer David Kenyon.
BetWarrior, featuring a Shape Games front end in Mendoza, Argentina was one of five partner launches for Kambi in Q2.
Meanwhile, operator trading margin – defined as gross gaming revenue as a percentage of operator turnover – reached 9.9% in the quarter. This figure, driven by favourable football and basketball results, was up from 8.6% in the corresponding period in 2022 and up from 8.2% in Q1 of 2023.
Operator turnover growth
Kambi said that the above-average figure was the highest such margin for at least five years. Conversely, the provider added that such a margin actually dampens operator revenue growth, which was a modest 4% in the quarter.
Operator turnover growth was also impacted by rising foreign exchange headwinds and Penn Entertainment’s year-on-year decline in US market share. Excluding the impact of foreign exchange movements, EBITA increased by €2.8m year-on-year.
In October, Penn announced it would migrate its sportsbooks from Kambi to its own proprietary technology. However, Kambi will receive $15m in transition fees from Penn, split over five quarters, as part of the migration. Kenyon confirmed that the first of these payments would occur in Q3.
Kambi is aiming for turnover of €330m to €500m by 2027 – approximately two to three times the total revenue posted in 2022. The company is also targeting earnings above €150m in 2027.
Original article: https://igamingbusiness.com/sports-betting/kambi-q2-results/
