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Read Full BioShares of Kambi Group (KAMBI:ST) dipped around 6% Wednesday after the sports betting technology provider reported disappointing second-quarter earnings.
Kambi, which trades on the Stockholm Stock Exchange, missed its earnings and revenue estimates for the quarter ending June 30.
The Malta-based company generated revenue of €40.5 million ($47.5 million), representing an 11.5% year-over-year decline. It also fell short of the analyst consensus estimate of €41.1 million.
Further, Kambi made €3.7 million in EBITA (earnings before interest, taxes, and amortization). That’s less than the estimate of €4.0 million and down 51% from €7.5 million last year. Last quarter was even worse, so the combined drop for H1 is 55%. Earnings per share for the second quarter of 2025 were €0.009 compared to €0.155 in Q2 2024. For the first half, earnings were €0.036 per share compared to €0.260 for the same period a year ago.
“Q2 2025 proved to be a quarter that reflected both the resilience of our business and the evolving dynamics of our industry,” Werner Becher, CEO of Kambi Group, said. “While results were in line with our expectations, they came against a backdrop of challenging market conditions and tough comparisons with Q2 2024.”
Transition Fees Distort the Year-Over-Year Picture
However, a direct year-over-year comparison paints a somewhat distorted picture. That’s because of the transition fees that Kambi received in the second quarter of 2024 from PENN Entertainment (NASDAQ:PENN). Penn had agreed to pay Kambi about €13 million in fees after deciding to migrate from Kambi’s technology platform to PENN’s in-house platform. The last installment payment occurred in Q2 of 2024. Of that, €4.5 million was paid in Q2 last year. Excluding that one-time payment, Kambi revenue is down by a more modest 2%.
If we combine Q1 and Q2, Kambi generated €81.9 million in revenue in the first half of 2025, a 7.9% drop. However, excluding the 2024 transition fees changes the story entirely. In that light, revenue was actually up 2.3% year-over-year in H1.
Significant Kambi Wins Include DraftKings Deal
The quarter was not all bad news for Kambi. The company scored some significant wins through its turnkey sportsbook solution. That white label product provides customers with a fully functional platform to run their own sportsbook.
Notable white label deals for Kambi in the quarter included a turnkey sportsbook partnership with Latin American company RedCap for its Betpro and Starplay sportsbooks. The initial rollout will be in Panama and El Salvador, but RedCap’s goal is to expand throughout the region.
Kambi also inked a two-year extension for its turnkey sportsbook with LeoVegas Group, now owned by MGM. In addition, it expanded its agreement with LeoVegas by signing a new deal for its new Odds Feed+ product. Odds Feed+ provides real-time odds for LeoVegas and its brands LeoVegas, BetMGM, BetUK, and Expekt.
Becher also announced on the earnings call that Kambi has agreed to a deal with DraftKings (NASDAQ:DKNG) to help launch its sportsbook in Puerto Rico. This had not been announced in a press release, which Becher explained as “commercial sensitivity” about the agreement.
The CEO mentioned that Kambi has had “very productive, constructive discussions” with DraftKings about supporting them in other regions.
“So, I couldn’t guarantee that there will be no further deals with DraftKings, but I can’t comment on anything else,” Becher said on the call, as transcribed by Market Screener.
Also of note, Kambi launched a €15 million share buyback initiative, the largest yet for the company. Becher said it underlines “the confidence we have in the future prospects of our business.”
Full-Year Guidance Unchanged
Finally, despite the rough quarter, the company maintains its full fiscal year guidance of €20 to €25 million in EBITA.
That said, CFO David Kenyon acknowledged on the call that earnings would likely be toward the lower end of that range. Kenyon added that Kambi anticipates second-half growth thanks to its Brazilian market and Odds Feed+ deals, as well as from its partnership with the Ontario Lottery and Gaming Corporation. Kenyon also pointed to a strong fourth-quarter sports calendar and “more positive contribution from the savings program.”
Kambi also received a Nevada license earlier this year, opening another potential avenue of expansion.
