Kambi puts faith in product development to offset H1 hurdles
Kambi’s 2022 trading difficulties continued in the second quarter of the year, as the sportsbook solutions group registered further declines against the previous year’s figures.
The Stockholm-listed firm again cited tough comparatives with the January-June trading period in 2021 such as headwinds in the Dutch market, whilst also pointing to a disrupted sporting schedule due to the 2022 FIFA World Cup not taking place at the usual time.
Published this morning, Kambi’s H1/Q2 trading report detailed a total half year revenue of €71.5m (H1 2021: €86m), alongside operating profit/EBIT of €12.2m (€35.3m), with a margin of 17.1% (41%).
Meanwhile, Q2 specifically saw revenue of €34.7m (Q2 2021: €42.8m) and operating profit of €4.9m (€16.6m), at a margin of 14.1% (38.8%). Second quarter and total half year revenue represented a year-on-year drop of 19% and 16.8% respectively, whilst Q2 earnings also fell by 6% against the previous quarter.
Despite these difficulties, Kambi remains confident in its financial prospects, noting that the combination of awkward comparatives with the previous year and a 16% uptick in operator turnover when adjusting for the migration of DraftKings led to underlying growth ‘remaining healthy’.
“In Q2, Kambi delivered another positive quarter with underlying growth remaining healthy and operator turnover up 16% when adjusting for the migration of DraftKings,” said Kristian Nylén, Kambi Group CEO.
“This performance was achieved despite a quieter than usual sporting calendar, particularly with the soccer World Cup taking place later in the year, outside its usual Q2 starting slot.”
Hoping to further offset headwinds as the year progresses, Kambi stressed confidence in its product team, which it stated is ‘working tirelessly’ on development of its Bet Builder offering.
Additionally, the group detailed plans to further open up and modularise its platform to boost market reach, speed up the production process and offer modules as standalone offerings to operators outside of its network to create additional revenue streams.
“In Q2, we hit an important milestone on this modularisation journey,” Nylén added. “As we communicated in the previous quarter, we have been focused on separating pricing functionality from our core platform and in recent weeks we were pleased to soft launch our first standalone pricing functionality for a limited number of low-tier soccer leagues.
“This functionality leverages Kambi’s recently developed Trading Gateway, serving the Kambi platform as well as potentially operators outside the Kambi network, and presents partners with an opportunity to take even more control of their offering should they wish.”
Lastly, the firm has highlighted North American progress as indicative of a bounceback against tough trading and comparatives, having secured day-one presence in the Ontario market, expected to become of the most dominant in the region.
Additionally, Kambi has since expanded its client network in the continent, partnering with Mohegan Gaming & Entertainment and its Fallsview Casino in the Canadian province, as well as US firm and BetPARX operator Greenwood Gaming and Entertainment.
Nylén concluded: “This is an exciting time for Kambi. The product journey we are on today along with our healthy balance sheet and positive underlying financial performance means we are on a strong footing for the future.
“We were delighted to see Kindred relaunch in the Netherlands recently and with more product launches, partner signings and a World Cup to come, I look forward to an even greater second half of the year.”