GAMB — Gambling.com Group Limited

Summary of Gambling.com Group Q1 2026 Earnings Call

1. Key Financial Results and Metrics

• Revenue: $40.4 million, flat year-over-year.
• Adjusted EBITDA: $9 million, down from $15.9 million in Q1 2025, resulting in a margin of 22%.
• Adjusted Net Income: $3.8 million ($0.09 per share), down from $16.5 million ($0.46 per share) a year ago.
• Adjusted Free Cash Flow: $3.9 million, compared to $10.3 million in Q1 2025.
• Sports Data Services Revenue: Grew 13% year-over-year to $11.2 million, accounting for 28% of total revenue.
• Marketing Revenue: Declined by 5% to $29.2 million, impacted by SEO challenges and regulatory headwinds.

2. Strategic Updates and Business Highlights

• AI Integration: The company is transitioning to an AI-first operational model, with 80% of new code generated by AI. This shift aims to enhance efficiency and reduce workforce size by approximately 25%, leading to annualized savings of $13 million.
• OpticOdds Growth: The B2B sports data service, OpticOdds, saw a 94% increase in new deals and a 178% rise in international partnerships. The integration of AI tools is enhancing customer engagement and product stickiness.
• Diversification Efforts: Non-SEO revenue exceeded SEO revenue for the second consecutive quarter, indicating a strategic shift towards diversifying marketing channels.

3. Forward Guidance and Outlook

• 2026 Revenue Guidance: Updated to a range of $165 million to $170 million, reflecting a $5 million reduction due to SEO challenges.
• Adjusted EBITDA Guidance: Expected to be between $45 million and $50 million, with margin expansion anticipated in the second half of the year.
• Second Half Expectations: Management expects significant growth in revenue, adjusted EBITDA, and free cash flow in H2 2026, driven by cost savings from restructuring and improved marketing performance.

4. Bad News, Challenges, or Points of Concern

• Declining Marketing Revenue: The marketing segment continues to face headwinds from SEO challenges and regulatory impacts in the U.K. and Finland, leading to a 5% revenue decline.
• Lower Adjusted EBITDA Margin: The margin decreased significantly due to higher costs associated with traffic diversification strategies.
• Regulatory Headwinds: Ongoing regulatory changes in key markets are affecting performance and creating uncertainty.
• Workforce Reduction: The planned 25% workforce reduction raises concerns about maintaining operational effectiveness and content quality.

5. Notable Q&A Insights

• U.K. Market Trends: Management noted a 30% decline in U.K. revenue, with lower lifetime values (LTVs) for customers. However, there are signs of improving SEO traffic since mid-April.
• U.S. Marketing Dynamics: The U.S. marketing business showed growth, with a notable increase in new customer acquisitions. However, customer acquisition costs (CPAs) are rising due to increased competition.
• Restructuring Risks: Concerns were raised about the potential risks of reducing human oversight in AI-driven processes, but management emphasized the importance of maintaining quality and human involvement.
• Branding Considerations: There is ongoing consideration of rebranding, as the current name may not fully represent the company's diversified portfolio and growth direction.

This summary encapsulates the key points from the earnings call, highlighting both the achievements and challenges faced by Gambling.com Group in Q1 2026.