Gambling.com's Q1 2025: Unraveling Contradictions on AI Monetization, Tax Impacts, and M&A Strategy

AI traffic and monetization, impact of tax increases on business model, timeline for achieving a $100 million EBITDA milestone, affiliate strategy and Google's search dominance, and M&A strategy and focus are the key contradictions discussed in Gambling.com's latest 2025Q1 earnings call.



Strong Revenue and EBITDA Growth:
- Gambling.com Group reported record all-time quarterly revenue of $40.6 million, rising 39% year-over-year, and adjusted EBITDA grew by 56% to $15.9 million.
- The growth was driven by a combination of record marketing performance and the integration of newly acquired sports data services, OddsJam and OpticOdds, which contributed significantly to the increased subscription revenue.

Subscription Revenue and Marketing Performance:
- Subscription revenue accounted for 24% of the first quarter's revenue, with the marketing business delivering over 138,000 NDCs, representing 29% growth year-over-year.
- The increased subscription revenue was attributed to the transformation of the company's business model into a marketing and sports data services company, leading to a more predictable revenue stream.

Increased Market Share and Geographic Expansion:
- Gambling.com Group reported iGaming revenues rising 24% year-over-year, with growth in market share across the UK and Europe, and North American sports betting business lapping difficult comparisons.
- The growth was supported by strong organic growth and contributions from recent acquisitions, particularly Freebets.com, and strategic expansion into new markets.

Acquisition Impact on Sports Data Services:
- The acquisition of OddsJam and OpticOdds on January 1st significantly contributed to the company's sports data services, with revenue quadrupling in the first full quarter of integration.
- The acquisition's strategic and financial value was highlighted by the high growth potential and entrepreneurial energy brought by the new teams, expected to incrementally add at least 20% to adjusted EBITDA this year.