Kambi Reports 6.5% Revenue Increase in Q2 2024 Amid Leadership Transition
Kambi, a leading sportsbook specialist, reported a 6.5% increase in revenue for the second quarter of 2024, reaching €45.7 million. This marks an improvement from Q2 2023 and reverses a marginal decline seen in Q1 2024. The company’s outgoing CEO, Kristian Nylén, attributed this growth to a busy sports calendar and strong performances from both existing and new partners.
Impact of Major Sports Events
Wagers placed through Kambi-powered operators increased by 3.1% during the quarter. However, excluding the migration of Penn Entertainment to its proprietary platform, turnover would have surged by 20%.
Penn Entertainment’s transition fees, linked to brands such as ESPN Bet and theScore, will cease this month, potentially reducing Kambi’s revenue by €5 million in the latter half of 2024.
Despite this, major sports events like the Euro 2024 and Copa America 2024, along with new launches including LiveScore in the UK and Svenska Spel’s Oddset brand, significantly boosted Kambi’s performance.
“During the second half of June, activity on the Kambi platform was at its highest ever levels in terms of bets processed and number of players per day,” noted Nylén.
Regional Revenue Distribution and New Partnerships
Kambi’s revenue distribution in Q2 was evenly split between Europe and the Americas. Europe’s contribution rose to 50%, up from 44% last year, while the Americas’ share decreased to 46%, down from 53%.
The addition of a new client in the US, the Choctaw Nation of Oklahoma, is expected to positively impact this distribution in the future.
This exclusive agreement will see Kambi providing sports betting technology and services across both online and retail platforms.
Financial Performance and Cost Management
Despite inflationary pressures, Kambi managed to reduce its operating expenses marginally to €29.7 million. Although staff costs increased to $16.4 million, savings were achieved across data costs and other operating expenses, as well as currency exchange losses.
This cost management contributed to a significant improvement in the company’s EBITDA margin, which rose to 16.4% from 11.7% the previous year. Operating profit increased by 67% to €6.2 million, with net profit climbing 83% to €4.7 million.
Leadership Transition
The publication of these financial results coincides with the end of Kristian Nylén’s tenure as CEO. Nylén, who has led Kambi since its spin-off from Kindred Group in 2010, will remain on the board.
Werner Becher, formerly of Sportradar, will take over as CEO. Nylén expressed confidence in Becher’s ability to lead Kambi into a new era of multi-product provision.
Outlook for the Future
Kambi has described 2024 as a transitional year, with expected revenue in the range of €170 million to €180 million. This outlook accounts for the impact of Penn’s migration and renewed contracts with Kindred and other clients.
The delayed opening of Brazil’s regulated market has also slowed growth in 2024, but with market opening scheduled for January 1, 2025, Kambi anticipates a gradual increase in market share.
