Kambi Group plc Class B ((SE:KAMBI)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Kambi Group’s recent earnings call presented a mixed sentiment, highlighting both achievements and challenges. The company celebrated new partnerships and cost efficiencies, yet faced revenue declines and delays in key projects. While strategic initiatives are underway, the overall outlook is weighed down by market dynamics and revenue challenges.
New Commercial Agreements
Kambi Group has been proactive in expanding its commercial footprint, signing 12 new agreements since the start of the third quarter. A significant highlight is the partnership with Tier 1 operator Superbet Group, which is expected to enhance Kambi’s market presence and drive future growth.
Acquisition of PAM Source Code
In a strategic move, Kambi announced the acquisition of the source code for a player account management platform. This acquisition is poised to open new opportunities, particularly in the Nevada market, positioning Kambi for future expansion and innovation.
Cost Efficiency Achieved
Kambi’s efficiency program has yielded substantial cost reductions, with expenses approximately EUR 4 million lower than the same quarter last year. This demonstrates the company’s commitment to optimizing operations and maintaining financial discipline.
Strong Operator Trading Margin
The operator trading margin for the quarter was robust at 10.3%, driven by strong performance in July and August. This indicates effective management and operational strength in navigating market conditions.
Positive Cash Flow and Share Buybacks
Despite spending EUR 8.1 million on share repurchases, Kambi ended the period with a positive cash flow and a cash balance of EUR 45.4 million. This reflects the company’s solid financial foundation and strategic capital management.
Revenue Decline
Kambi reported a revenue decline for Q3, with EUR 37.4 million, marking an 8.1% decrease compared to the previous year, excluding nonrecurring transition fees. This decline underscores the challenges faced in the current market environment.
Adjustments to EBITDA Guidance
The company has adjusted its full-year 2025 EBITDA guidance to approximately EUR 17 million, down from the original range of EUR 20-25 million. This adjustment is attributed to macroeconomic pressures and delays in key projects.
Impact of FX and Regulatory Challenges
Foreign exchange headwinds and stringent regulatory requirements, particularly in Brazil, have negatively impacted Kambi’s performance. The weaker U.S. dollar and Colombian peso contributed to a EUR 1.8 million negative impact.
Delay in Ontario Lottery Launch
The anticipated launch with Ontario Lottery has been postponed to early Q1 2026, affecting expected revenue streams and contributing to the adjusted guidance.
Challenges in Brazilian Market
The regulated Brazilian market has been slower to develop than anticipated, with ongoing challenges in converting players from the pre-regulated market, impacting Kambi’s growth prospects in the region.
Forward-Looking Guidance
Kambi has revised its full-year 2025 EBITDA guidance to around EUR 17 million, reflecting macroeconomic pressures, FX headwinds, and project delays. Despite these challenges, the company maintains a positive cash flow and continues to pursue strategic initiatives, including new partnerships and acquisitions, to drive future growth.
In conclusion, Kambi Group’s earnings call reflects a blend of strategic achievements and market challenges. While new partnerships and cost efficiencies are promising, revenue declines and regulatory hurdles present ongoing obstacles. The company’s forward-looking guidance highlights a cautious yet optimistic approach to navigating these complexities.