iGaming Wrap-Up of CW 45-46 2024
#iGaming News of the week
0.?????? Better Collective lays off 300+ staff amid Brazil and US strains
Better Collective has confirmed that more than 300 employees, representing 15% of its workforce, were let go following a challenging Q3.
This restructuring is part of a larger €50m cost reduction programme aimed at realigning the affiliate business with current market dynamics, particularly in the US and Brazil.
For Q3 2024, Better Collective reported revenue of €81m, marking an 8% increase overall but reflecting a 6% drop in organic growth.
Recurring revenue, however, rose 14% to €53m, and EBITDA before special items reached €22m, up 14% year-on-year.? Despite these gains, Better Collective downgraded its 2024 guidance in October, lowering revenue forecasts to between €355m and €375m, down from the previously anticipated €395m-€425m range. The company also revised EBITDA projections to between €100m and €110m and launched a cost-saving initiative.
#Breaking News
1.?????? Raketech dire Q3 as performance tumbles on all media activities
Raketech Plc trades cautiously as challenging conditions continue to impact the performance of its affiliate network and media partnerships.
In its Q3 report, Raketech disclosed a 39% drop in corporate revenues to €12.9m, compared to €21.5m in Q3 2023.
Trading during the period showed performance declines across all core business segments, with affiliate revenues decreasing to €6.8m (Q3 2023: €9.5m).
The firm’s affiliate network continues to adjust to changes in Google’s core algorithm, which have affected the search rankings of its flagship asset, Casumba. Additionally, Raketech has observed reduced spending on affiliate marketing in Sweden due to increased taxes on online gambling activities.
2.?????? FanDuel Parent Stock Hits New High On Q3 Report
FanDuel turned what is expected to be one of the worst streaks of industry sports betting losses into a win, as it reported earnings that showcased more resilience than its competitors and Flutter shares hit an all-time high in New York.
FanDuel parent Flutter announced on Tuesday that revenue grew 27% year over year to $3.25 billion in the third quarter, beating Wall Street estimates by 7%. Adjusted EBITDA grew 75% to $450 million, exceeding analysts’ expectations by 25%.
Flutter’s stock (FLUT) closed Wednesday at $265.52, a new 52-week high. Shares rose 7% the day after earnings with volume 1.5 times its daily average.
Investors seemed encouraged by Flutter’s better-than-expected US guidance, despite challenging NFL results for sportsbooks. One sports betting operator reported its “most customer-friendly week ever” during the quarter, while a five-week streak of favorites winning recently prompted FanDuel’s chief competitor to lower year-end guidance by $175 million.
Flutter’s guidance adjustments were far more modest, lowering adjusted EBITDA guidance by $30 million to $710 million at the midpoint — a 4% adjustment. The company raised full-year revenue guidance by 1% and forecasts 22% growth at the midpoint thanks to its performance in other international markets.
3.?????? French gambling giant FDJ to launch bonds worth €1.5bn
The French gambling giant La Fran?aise des Jeux FDJ has announced that it will issue bonds totalling €1.5bn on the Paris Euronext exchange. The bonds will be issued in three tranches with maturity dates of six, nine and 12 years.
The proceeds raised from the bond issue will go towards refinancing a €2bn bridge loan that FDJ secured to cover its €2.6bn acquisition of the Swedish igaming operator Kindred Group. It will repay the bonds using cash flow.
The company, which runs the French national lottery and used to be a state-owned monopoly, will meet with investors in the coming days to gauge market sentiment. FDJ is also arranging a €400m syndicated loan from major French and international banks. It will repay the loan over five years.
4.?????? GMGI tops $100m revenues on MeridianBet efficiencies
Golden Matrix Group (GMGI) has surpassed $100 million in corporate revenues for the year, underscoring its successful integration of MeridianBet.
Publishing its Q3 trading statement, the Nasdaq-listed global online gambling group registered consolidated revenues of $41 million (+85%).
For the year-to-date, GMGI revenues increased to $105 million, driven by the continued growth of MeridianBet and GMGI tech services.
As detailed, Q3 trading saw MeridianBet register a 19% increase in online activity and 6% in retail. Deposits rose to $61.9 million (+13% QoQ), with new registrations up 23% to 125,000. The online casino GGR margin reached 3.37% (+21% turnover), sports betting rose 7.4% YoY with GGR at 9.5%, retail sports GGR at 10.3% (a record 14.1% in August), and retail slots were up 17.5% YoY.
5.?????? Sportradar ups €1bn guidance on strength of partnerships
Sportradar AG is building strong commercial momentum as it pursues its post-IPO goal of surpassing €1bn in revenue.
In its Q3 report, this global Nasdaq-listed sports technology company announced a 27% increase in revenue to €255m (up from €201m in Q3 2023). Year-to-date, revenues have reached €799m, marking a 28% increase over the previous year’s €625m.
Betting Technology sales rose 32% to €210m, driven by a 37% jump in Betting & Gaming Content sales to €162m (compared to €118m in Q3 2023). The Sports Content, Technology & Services segment generated €45m, boosted by 10% growth in Marketing & Media Services.
The growth came from strong ad:s revenue in both Europe and North America, as sportsbooks ramped up marketing efforts. In the U.S., Sportradar’s revenue grew 46% to €51m, benefiting from cross-selling content and services to new partners.
6.?????? Aristocrat’s Pixel United sells game developer Plarium for up to $820m
Aristocrat subsidiary Pixel United has agreed to sell its mobile game development company, Plarium Global, to Modern Times Group (MTG) in a transaction worth up to $820 million. MTG is a Stockholm-based gaming and esports company. It will pay $620 million for Plarium Global and could fork out an additional $200 million based on Plarium’s performance from 2025 to 2028.
The sale is part of Aristocrat’s strategic review begun in May 2024 which is aimed at honing the company’s focus on core areas of the business, including land-based gaming, social casino offerings, and real-money gaming.
Aristocrat acquired Plarium in October 2017. The company develops free-to-play and social mobile and PC games, including Vikings: War of Clans, and has more than 500 million registered users worldwide. Unaudited Q3 2024 results show that Plarium contributed $615 million in revenue and $110 million in EBITA to Aristocrat.
7.?????? FY 2024: NeoGames integration fuels 84% Aristocrat Interactive growth
The integration of NeoGames’ assets drove an 83.9% revenue rise at Aristocrat Leisure’s Interactive division in full-year 2024.
Revenue at the online Real Money Gaming division increased to A$335.7m (€206.3m) in 2024, compared to the A$182.6m reported the previous year. The Australian B2B gaming giant said this was driven by organic growth in Platforms, scaling iGaming in Europe and North America, as well as inclusion of NeoGames and Roxor in the results.
Aristocrat launched its Interactive division in April 2024 after completing the $1.2bn acquisition of NeoGames, which had been first announced the year before.
Chief executive and managing director Trevor Croker hailed the division’s “strong momentum” during the year. He said: “This result again highlights resilience and scale as fundamental strengths of our business, supported by an effective focus on operational efficiency and extracting operating leverage.
#US / Canada
8.?????? Chris Christie predicts Texas to regulate sports betting next session
With the eyes of the gaming industry fixed on Texas, the godfather of legal U.S. sports betting believes it's only a matter of time before the Lone Star State joins the club.
"I think (legalization will) happen in Texas in the next legislative session," Chris Christie told Covers in a recent wide-ranging interview. Christie, who served as governor of New Jersey from 2010-18, was the catalyst for the wide-scale legalization of sports betting, spearheading the efforts to have the Professional and Amateur Sports Protection Act (PASPA) repealed by the Supreme Court in May 2018.
In the 5 1/2 years since that landmark decision, a whopping 39 states have adopted some form of legal retail and/or online sports wagering, with Missouri set to enter the fray some time in 2025. And Christie believes that Texas might very well be next, though Covers industry news analyst Ryan Butler contends that the election of Republican Adam Hinojosa to the state Senate will actually complicate efforts to introduce legal sports betting.
9.?????? Louisiana lawmaker's major sports betting tax hike bill deferred
Louisiana Representative Roger Wilder's (R-71) legislation to raise the state’s sports betting tax rate from 15% to 51% has been deferred at the lawmaker's request. If approved, House Bill 22 would have aligned Louisiana’s sports betting tax rate with New York’s as the highest in the United States, in a bid to generate significant additional revenue amid a state budget deficit.
Wilder’s proposal, which received a hearing at the House Ways and Means Committee on Wednesday, sought to raise the tax rate and also included a provision to prevent sports betting operators from deducting promotional play credits from their taxable revenue. Analysts projected the 51% rate could have yielded $205.3 million in taxes for Louisiana in the fiscal year, a stark increase from the $52.2 million collected under the current rate.
However, the bill was deferred at Wilder’s request at Wednesday’s hearing, with the lawmaker saying he would continue to work on the proposal. It is unlikely to come up again in the current special session that must end by Nov. 25.
10.?? Tennessee operators set record for handle
Bettors in Tennessee laid down a record $551.2 million (￡432.5 million/€521.7 million) in bets in October, marking the third time since the market went live that more than $500 million was bet.
Tennessee bettors previously broke the $500 million barrier in September ($520.8 million) and in November 2023 ($520.8 million).
According to figures released by the Tennessee Sports Wagering Council (SWC) yesterday (12 November), adjusted handle was $547.8 million, after $3.4 million in adjustments. The SWC does not indicate on the report what the adjustments are for, nor does it break down bets by operator or sport. The SWC also does not report operator revenue.
11.?? North Carolina in October: Revenue plummets while handle rises
October marked the first full month of football for North Carolina digital sportsbooks – and revenue dropped $21.4 million (￡16.6 million/€20.2 million) despite handle rising $36.6 million against September.
According to the North Carolina revenue report released today (12 November), the differentiator was hold, which was the lowest since sports betting went live in North Carolina. In September, sportsbooks had a 12.2% hold rate, but in October that number dropped to 8%. Operators across the US have lamented a tough October with bettor-friendly results during quarterly earnings calls.
#M&A & Finance
12.?? PointsBet denies A$300m Asian takeover rumours
PointsBet denied rumours the company is on the brink of agreeing a A$300m (€185m) takeover deal today (11 November).
The mystery deal, which was reported on Friday by Murdoch-owned broadsheet The Australian, would have seen the online gaming business acquired by an unidentified overseas entity. Quoting anonymous sources, the newspaper said PointsBet has had several discussions with potential partners regarding a possible merger, with many of these being informal.
However, the daily said one potential Asian-based suitor has entered into serious talks about the possibility of a merger or takeover.
13.?? IGT books $38m reorganisation fee to begin ‘pure play’ on lottery tech
The board of IGT Plc has announced to markets that, as of this morning, the NYSE technology group will operate solely as a lottery systems technology provider.
This announcement comes as IGT expects to complete the sale of its Gaming & Digital business to Apollo Global by the end of Q3 trading in 2025.
On 26 July, IGT accepted a $4.05bn offer from New York PE fund Apollo Global to acquire its Global Gaming and PlayDigital units. The buyout is part of a $6.3bn transaction by Apollo Global, which will merge IGT’s gaming and digital units with fintech partner Everi Holdings, under the private ownership of the PE fund.
Publishing its Q3 trading update, IGT announced to markets: “This quarter marks the first reporting period where the results of the Gaming & Digital business are classified as discontinued operations.”
14.?? Gambling.com Group Reports Third Quarter 2024 Results and Raises 2024 Guidance
Gambling.com Group Limited (Nasdaq: GAMB) (“Gambling.com Group” or the “Company”), a fast-growing provider of digital marketing services for the global online gambling industry, today reported financial results for the third quarter ended September 30, 2024. The Company also raised its 2024 revenue and Adjusted EBITDA guidance as detailed below.
“Our record third quarter and year-to-date results reflect our best-in-class execution in the affiliate sector to consistently grow market share around the world,” commented Charles Gillespie, Chief Executive Officer and Co-Founder of Gambling.com Group.
“The third quarter’s strong revenue growth and record Adjusted EBITDA highlights Gambling.com Group’s position as an industry leader in creating value for both our shareholders and our online gambling operator clients. To complement our continued organic market share growth, we continue to evaluate opportunities adjacent to the core business to expand our footprint in the online gaming ecosystem as we progress towards our goal of $100 million in annual Adjusted EBITDA.”
15.?? Gentoo Media Q3 2024 revenue up 35%; up 12% organically
With a shift to a dedicated affiliate model, Gentoo Media achieved record revenue growth in Q3 2024, following its recent separation from sportsbook operations.
Gentoo Media, formerly known as Gaming Innovation Group, reported record revenue growth for the third quarter of 2024, a result of its recent restructuring efforts and emphasis on higher-value markets.
The company’s Q3 2024 revenue increased by 35% year-on-year to €30.4m ($32.2m), of which 12% came from organic growth. This result marks Gentoo’s 15th consecutive quarter of record revenue.
Gentoo’s recent rebranding and completion of its separation from its platform and sportsbook division, which took effect on 30 September, has left the company focused exclusively on its affiliate business.
16.?? FanDuel founders latest: BetHog crypto casino and sportsbook
New platform accepts various cryptocurrencies, is not available in US or UK.
Tech entrepreneurs Nigel Eccles and Rob Jones have a proven track record for success as the co-founders of FanDuel and they revealed their next major project in the gaming space yesterday (12 November). The duo has launched BetHog, a crypto online casino and sportsbook. It is available for play in assorted countries – but not the US or UK.
BetHog launched with $6 million (￡4.7 million/€5.7 million) in seed funding, led by 6th Man Ventures (6MV) with additional funding from Will Ventures, Bullpen Capital, Karatage, Advancit Capital and such noted angel investors in the gaming space as Chris Grove and Josh Hannah.
“The crypto casino market has seen dramatic growth over the past few years driven by innovations like provably fair games, robust VIP programmes and streaming,” Eccles said in a press release. “With BetHog, my goal is to innovate even further by bringing unique and highly visual games to market. I want to offer users unique play-along and skill-based titles, combined with a robust VIP offering, but most of all, this is about maximising fun for our users!”
17.?? SEC gives Nuvei thumbs up for Advent takeover
Payments company Nuvei has been given the greenlight to go private by the US Securities and Exchange Commissions (SEC).
Mere hours separate the company from going public to private, with the announcement confirming that the transition will happen “on or about” 15 November, with the addition of some closing conditions.
The purchasing company is NYC private equity firm Advent International, which finalised the terms around buying Quebec-based Nuvei back in April for a total of $6.4bn, or ￡34 per share.
Receiving the SEC’s approval will eventually lead to Nuvei’s delisting from the Toronto Stock Exchange (TSE) and the NY Nasdaq.
18.?? Endeavor confirms $450 million OpenBet management buyout
Endeavor agreed to sell its OpenBet and IMG Arena businesses on 11 November to OB Global Holdings in a management buyout (MBO) worth approximately $450 million (￡351 million/€423 million).
The MBO is being backed by Endeavor CEO Ariel Emanuel and features participation from several OpenBet executives, including CEO Jordan Levin. It will be financed through a mix of cash and debt.
A management buyout is when part or all of a company’s management team acquire various assets and operations from the company’s owner. It is typically carried out as a means to take a company private.
#Legal & Regulation:
19.?? Swedish-licensed gambling companies generate SEK 6.66bn in Q3 turnover
Spelinspektionen, the Swedish Gambling Authority, has released financial results for the gambling industry in the country during the third quarter of 2024.
For Swedish-licensed gambling companies, total turnover during the third quarter reached SEK 6.66bn ($0.61bn), representing a decrease of 1.2% year-on-year, while compared to Q2 2024, represents a drop of 3.4%.
20.?? New Zealand proposes to limit online casino licenses
New Zealand unveiled on Wednesday a proposal to limit the number of licenses for online casino operators, require them to set up an age verification system, and ban advertisements aimed at children, as it looks to regulate the fast-growing sector.
Offenders will be fined up to NZ$5 million ($3 million), with the new regulatory system expected to be in place from early 2026, Internal Affairs Minister Brooke van Velden said.
"My goal is not to increase the amount of gambling that is happening online, but to enable New Zealanders who wish to play casino games online to do so more safely than they can today," Van Velden said in a statement, retrieved by Reuters.
21.?? Tabcorp penalised for accepting illegal in-play bets
Australian operator Tabcorp has incurred a penalty of AU$262,920 ($171,647) for breaching Australia’s Interactive Gambling Act 2001 by accepting in-play sports bets online.
An investigation by the Australian Communications and Media Authority (ACMA) revealed that between April and October 2023, Tabcorp took 854 in-play bets on 69 different tennis matches, despite the Australian ban on in-play betting.
ACMA’s restrictions on in-play betting aim to minimise gambling harm by limiting the frequency and accessibility of betting during live events.