Progress in the rapidly emerging US market was writ large across the Q3 financial update issued by sportsbook specialist Kambi Group this week amid an expected slower quarter that saw gains in revenue against a dip in operating profit.
Revenue came in at $25.5m versus $22.75m year-on-year, while operating profit was down to $3.77m against $4.66m for the corresponding period. Profit after tax was $2.55m compared with $3.66m year-on-year. The firm cited a solid financial performance, however, with 12% revenue and 23% operator turnover growth despite a quiet sporting calendar.
Among the key highlights of the update was Kambi’s signing of Penn National Gaming, the largest regional gaming operator in North America, and JACK Entertainment, a leading gaming entertainment brand in Ohio.
The firm also noted the completion of multiple customer launches, including seven casinos in the US and taking the first legal bet in New York as well as launching on the first day of regulation in Indiana and Iowa.
CEO Kristian Nylén said: “The third quarter is traditionally a challenging one for the sports betting industry, particularly in a year with no major summer football tournament. This, along with our ongoing investments to capitalize on the huge US opportunity, was the reason for the year-on-year decrease in operating result.
“However, despite the tough World Cup comparatives and a relatively quiet July sporting calendar, I’m pleased to report Kambi Q3 revenue grew 12% year-on-year while operator turnover increased 23%.”
Focusing on the US, he added: “We signed two new customers during the quarter, the first being Penn National Gaming, the largest regional gaming operator in North America. With market access to as many as 19 states, Penn National was always a key US target for us. In addition to the land-based establishments Penn National operates, the company has a sports betting philosophy that complements our own, which bodes well for a long and successful relationship.
“We also signed a deal with JACK Entertainment, which covers two retail establishments and an online offering in Ohio. A digital-savvy operator with a strong, local brand, JACK Entertainment is an operator we are excited about working with.
“Meanwhile, we also secured contract extensions with NagaWorld and DraftKings, the latter of which has already seen us enter a number of additional states as we build upon the partnership’s early success in New Jersey.
“Overall, there were multiple US customer launches to mention in Q3, with online or on-property launches taking place across the states of New York, Iowa, Indiana, Pennsylvania, New Jersey and West Virginia. Among those launches was Unibet, who made its US sports betting debut in New Jersey and then launched retail in Pennsylvania. Once again, this demonstrates our market leading US proposition based on our regulatory expertise and operational capability.”
On the outlook, he concluded: “In general, Kambi remains well positioned for the future and I look forward to building on our successes in Q4 and beyond, a period which has begun well with an industry award win at the recent G2E exhibition in Las Vegas.”
