Q1 2025 Gambling.com Group Ltd Earnings Call

Greetings and welcome to the gambling Dot Com group's first quarter 2025 earnings conference call. At this time all participants are in a listen only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance. During the conference. Please press star zero on your telephone.

Operator: Greetings and welcome to the Gambling.com Group first quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode.

Operator: A brief question and answer session will follow the formal presentation.

Operator: If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded.

One key Pat.

Speaker Change: As a reminder, this conference is being recorded it is now my pleasure to introduce your host Peter Mccarthy Senior Vice President Investor Relations and capital markets. Thank you Sir you may begin.

Operator: It is now my pleasure to introduce your host, Peter McGough, Senior Vice President, Investor Relations and Capital Markets. Thank you, sir. You may begin. Thank you.

Peter McGough: Thank you Hello, everyone and welcome to gambling Dotcom group's first quarter 2025 results call I'm, Peter Mcgough, Senior VP of Investor Relations and capital markets and I'm joined by Charles Gillespie gambling Dot Com group's co founder and Chief Executive Officer, and Elliot Mark Chief Financial Officer.

Peter McGough: Hello, everyone, and welcome to Gambling.com Grp's first quarter 2025 results call. I am Peter McGough, Senior VP of Investor Relations and Capital Markets, and I'm joined by Charles Gillespie, Gambling.com Grp's Co-Founder and Chief Executive Officer, and Elias Mark, Chief Financial Officer. This call is being webcast live through the investor relations section of our website at gambling.com forward slash corporate forward slash investors and a downloadable version of the presentation is available there as well.

Peter McGough: This call is being webcast live through the Investor Relations section of our website at gambling Dot com forward slash corporate forward slash investors and a downloadable version of the presentation is available there as well a webcast replay will be available on the website. After the conclusion of this call you may also contact investor.

Operator: A webcast replay will be available on the website after the conclusion of this call.

Peter McGough: You may also contact investor relations support by emailing investors at gdcgroup.com. I would like to remind you that the information contained in this conference call, including any financial and related guidance to be provided, consists of forward-looking statements as defined by securities laws. These statements are based on information currently available to us and involve risks and uncertainties that could cause actual future results, performance, and business prospects and opportunities to differ materially from those expressed in or implied by these Some factors that could cause such differences are discussed in the risk factor section of Gambling.com Group's filings with the Securities and Exchange Commission.

Peter McGough: <unk> support by Emailing investors at G D C group dotcom.

Peter McGough: Yeah.

Speaker Change: I would like to remind you that the information contained in this conference call, including any financial and related guidance T. D provided consist of forward looking statements as defined by securities laws.

Speaker Change: These statements are based on information currently available to us and involve risks and uncertainties that could cause actual future results performance and business prospects and opportunities to differ materially from those expressed in or implied by these statements.

Speaker Change: Some factors that could cause such differences are discussed in the risk factors section of gambling Dotcom group's filings with the Securities and Exchange Commission and forward looking statements speak only as of the date. The statements were made and the company assumes no obligation to update forward looking statements to reflect actual results changes in assumptions or changes in other factors.

Peter McGough: Forward-looking statements speak only as of the date the statements are made, and the company assumes no obligation to update forward-looking statements to reflect actual results, changes in assumptions, or changes in other factors affecting forward-looking information, except to the extent required by applicable securities laws.

Speaker Change: Affecting forward looking information, except to the extent required by applicable securities laws.

Speaker Change: During the call. There will also be discussion of non <unk> financial measures a description of these non <unk> financial measures is included in the press release issued earlier this morning, and reconciliations of these non <unk> financial measures to their most directly comparable <unk> measures are included in the appendix to the.

Peter McGough: During the call, there will also be discussion of non-IFRS financial measures. The description of these non-IFRS financial measures is included in the press release issued earlier this morning, and reconciliations of these non-IFRS financial measures to their most directly comparable IFRS measures are included in the appendix to the presentation and press release, both of which are available in the Investors tab of our website.

Speaker Change: <unk> and press release, both of which are available in the investors tab of our website.

Charles Gillespie: I'll now turn the call over to Charles. Thanks, Pete. And good morning, everyone.

Charles: I'll now turn the call over to Charles.

Charles: Thanks, Pete and good morning, everyone.

Charles Gillespie: I'd like to start by thanking Frederick Burvall and Greg Michelson, two of our long standing directors whose terms ended at the AGM yesterday for their wisdom, service and support of the company over the better part of the past 10 years, and also welcome our two new directors, Fenton Costello and Jamie Mendel to the board. It was just a short time ago that we reviewed our tremendous 2024 results while previewing the 2025 growth plan. The year is off to a strong start, as expected, with record all-time quarterly revenue and adjusted EBITDA. Revenue rose 39% year-over-year to $40.6 million and adjusted EBITDA grew 56% to $15.9 million.

Charles: I'd like to start by thanking Frederick Burble and Greg Michelson two.

Charles: Two of our longstanding directors, whose terms ended at the AGM yesterday for their wisdom.

Charles: Wisdom and service in support of the company over the better part of the past 10 years and also welcome our two new directors fencing, Castello and Jamie Mendell to the board.

Charles: It was just a short time ago that we reviewed our tremendous 2024 results while previewing the 2025 growth plan.

Charles: The year is off to a strong start as expected with record all time quarterly revenue and adjusted EBITDA.

Charles: Revenue rose, 39% year over year to $40 6 million and adjusted EBITDA grew 56% to $15 9 million with.

Charles Gillespie: With 24% of first quarter revenue coming from recurring subscriptions, we have transformed a marketing-only business into a marketing and sports data services company with a substantial and growing percentage of highly predictable subscription revenue. Our competitive position in the global online gambling ecosystem and our sustainable growth opportunities have never been stronger in the company's 19 years. With our marketing business performing at all time highs and the significant expansion of our sports Data Services, following the acquisition of Odds Jam and Optic Odds on January 1st, we are confident in not only achieving our growth targets for the year, but also delivering on our strategic objectives to expand beyond marketing and reach 100 million in adjusted EBITDA.

Charles: With 24% of first quarter revenue coming from recurring subscriptions, we have transformed a marketing only business into a marketing and sports data services company with a substantial and growing percentage of highly predictable subscription revenues.

Charles: Our competitive position in the global online gambling ecosystem, and our sustainable growth opportunities have never been stronger and the company's 19 years.

Charles: Our marketing business performing at all time highs and the significant expansion of our sports.

Charles: Data services following the acquisition of Ards Jamon optic odds on January one we are confident in not only achieving our growth targets for the year, but also delivering on our strategic objectives to expand beyond marketing and reach $100 million and adjusted EBITDA.

Charles: The growth opportunity for us to have enough to gods is robust the integration of these new sports data services is progressing as planned and execution. In this business continues to highlight the significant strategic and financial value. This acquisition has brought to gambling dot com group, they're entrepreneurial energy and ambition fits.

Charles Gillespie: The growth opportunity for OzJam and Optigons is robust. The integration of these new sports data services is progressing as planned, and execution in this business continues to highlight the significant strategic and financial value this acquisition has brought to Gambling.com Grp. Their entrepreneurial energy and ambition fits right in with our team of talented and accomplished entrepreneurs. It is great to now be working hand-in-hand with these talented operators. The consumer-facing part of the business, Odds Jam, has a strong subscriber base that we are confident we can scale while maintaining margins and profitability. For the B2B side of the business, Optic Odds, we are just getting started with leveraging our reach and resources to grow enterprise subscription revenue.

Charles: Right in with our team of talented and accomplished entrepreneurs. It is great to now be working hand in hand with these talented operators.

Charles: The consumer facing part of the business odds Jim has a strong subscriber base that we are confident we can scale, while maintaining margins and profitability.

Charles: For the <unk> side of the business ought to gods, we're just getting started with leveraging our reach and resources to grow enterprise subscription revenues.

Charles: We continue to expect incremental adjusted EBITA from obviously have an off the gods to grow by at least 20%. This year and we see attractive long term growth prospects for the current products. While the current suite of products is a very attractive growth opportunity. We now own a platform that is capable of powering.

Charles Gillespie: We continue to expect incremental adjusted EBITDA from OzJam and OptiGods to grow by at least 20% this year, and we see attractive long-term growth prospects for the current products. While the current suite of products has a very attractive growth opportunity, we now own a platform that is capable of powering a broader array of enterprise products and services to solve more problems for our online sports betting clients. Turning to our marketing business, our iGaming-led strategy continues to drive performance, with iGaming revenues rising 24% year-over-year. This growth reflects solid, organic growth, complemented by contributions from FreeBets.com and its related assets.

Charles: A broader array of enterprise products and services to solve more problems for our online sports betting clients.

Charles: Turning to our marketing business, our I gaming led strategy continues to drive performance with our gaming revenues rising 24% year over year.

Charles: This growth reflects solid organic growth complemented by contributions from free bets dot com and its related assets. We continue to grow our market share in the U K and the rest of Europe, and our North American sports betting business has now lapped its last quarter of difficult comparisons for the full year 2025, we.

Charles Gillespie: We continue to grow our market share in the UK and the rest of Europe, and our North American sports betting business has now lapped its last quarter of difficult comparisons. For the full year 2025, we continue to expect our marketing business to grow in all of the geographic regions where we operate, including North America. We will add Missouri to our guidance once the launch date is clear. While the uncertain macro environment has recently created volatility in the capital markets and some uncertainty about the economy, I want to highlight that during the entire history of the online gambling industry, no economic slowdown has ever had any meaningful impact on the underlying growth of the industry.

Charles: We need to expect our marketing business to grow in all of the geographic regions, where we operate including North America, We will add Missouri to our guidance once the launch date is clear.

Charles: While the uncertain macro environment has recently created volatility in the capital markets and some uncertainty about the economy I want to highlight that during the entire history of the online gambling industry no economic slowdown has ever had any meaningful impact on the underlying growth of the industry.

Charles Gillespie: The online industry is fundamentally insulated from these economic effects as players don't have to travel to a land-based casino to continue playing. We expect this current cycle will be no different from the other cycles the company has grown through since its founding in 2006. We can confirm that there have been no changes to our business volumes or expectations due to changes in trade policy. Furthermore, we do not expect any impact on our business from any change in tariffs, whether in the U.S. or abroad. In addition to the resilient nature of online gambling, our strong competitive position sets us up to continue on our growth, on our strong growth trajectory.

Charles: The airline industry is fundamentally insulated from these economic effects as players don't have to travel to a land based casino to continue play.

Charles: We expect this current cycle will be no different from the other cycles. The company has grown through since its founding in 2006.

Charles: We can confirm that there have been no changes to our business volumes or expectations due to changes in trade policy. Furthermore, we do not expect any impact on our business from any change in tariffs whether in the U S or abroad.

Charles: In addition to the resilient nature of online gambling, our strong competitive position sets us up to continue on our growth or our strong growth trajectory.

Charles Gillespie: Our industry leading brands such as gambling.com and bookies.com and growing brands like casinos.com continue to drive market shared gains. Our full embrace of AI has also accelerated our ability to keep improving upon our technology stack and digital marketing capabilities to continue to drive organic growth. On top of this, with the acquisition of Odds Jam and Optic Odds, we have the best odds data infrastructure in the industry, and the revenue from that platform increases our overall revenue visibility. As a result, we are in our strongest competitive position ever and are thus well positioned to drive continued growth, profitability, and free cash flow, as reflected by our reiteration of our 2025 guidance, which will result in another year of record annual revenue and adjusted EBITDA and move us increasingly closer to our next goal of $100 million in annual adjusted EBITDA.

Charles: Our industry, leading brands, such as gamma dot com and bookings dotcom and growing brands like casinos Dot com continued to drive market share gains are full embrace of AI has also accelerated our ability to keep improving upon our technology stack and digital marketing capabilities to continue to drive organic growth.

Charles: On top of this with the acquisition of the odds jamming up the guards, we have the best odds of data infrastructure in the industry and the revenue from that platform increases our overall revenue visibility.

Charles: As a result, we are in our strongest competitive position ever and are thus well positioned to drive continued growth profitability and free cash flow.

Charles: As reflected by our reiteration of our 2025 guidance, which will result in another year of record annual revenue and adjusted EBITA and new bus increasingly closer to our next goal of $100 million in annual adjusted EBITDA.

Elias Mark: I will now turn the call over to Elias to review the first quarter's financial highlights. Thank you, Charles. First quarter revenues grew 39% year-over-year to $40.6 million. Our marketing business grew 13% as we delivered more than 138,000 NDCs to our customers, representing 29% growth year-over-year.

Charles: I'll now turn the call over to Elliot to review the first quarter's financial highlights.

Elliot: Thank you Charles.

Elliot: First quarter revenues.

Elliot: 39% year over year to $40 6 million, our marketing business grew 13% as we delivered more than 138000, and Dcs to our customers representing 29% growth year over year.

Elias Mark: Our sports data services business, which includes the first full quarter of revenue contributions from odds germ and optical quadruple. Subscription revenue was 24% of total revenue. Inclusive of revenue share arrangements in our marketing business, recurring revenue was 50% of total first quarter. Revenue grew in all geographic regions and we expect that to continue for the remainder of 2020. Gross profit increased 42% year over year to $38.4 million. Cost of sales was $2.2 million. which was flat year-over-year with lower media partnership fees offset by cost of sales related to the acquired odds jam and off-the-cuff odds.

Elliot: Our sports data services business, which includes the first full quarter of revenue contributions from <unk> and optical quadrupled.

Elliot: Subscription revenue was 24% for total revenue.

Elliot: Inclusive of revenue share arrangements in our marketing business recurring revenue was 50% of total first quarter revenue.

Elliot: Revenue.

Elliot: In all geographic regions, and we expect that to continue for the remainder of 2025.

Elliot: Gross profit increased 42% year over year to $38 4 million cost of sales was $2 2 million.

Elliot: Which was flat year over year with lower media partnership fees offset by cost of sales related to dark quiet, both Jim and optical.

Elliot: Yes.

Elliot: Well partnership fees were lower year on year, they were a bit higher than we had expected.

Elias Mark: While partnership fees were lower year-on-year, they were a bit higher than we had expected. Gross profit margin increased roughly 200 basis points compared to the first quarter of last year to 94.5%.

Elliot: Gross profit margin increased roughly 200 basis points compared to the first quarter of last year to 94, 5%.

Elliot: Total operating expenses increased 15% to $28 7 million, primarily reflecting a significant increase in amortization.

Elias Mark: Total operating expenses increased 50% to $28.7 million, primarily reflecting a significant increase in amortization from acquired intangible assets from the odds holdings and pre-bets acquisition. Operating expenses also absorb the cost base of the odds holdings acquisition. Excluding the non-cash acquisition related amortization, growth in operating expenses was well under our revenue growth of 40% per capita. Adjusted EBITDA increased 56% year-over-year to another all-time record of $15.9 million compared to $10.2 million a year. First quarter adjusted EBITDA margin was 39%, up 400 basis points from 35% in the year-ago period. First quarter adjusted EBITDA margin would have been even higher, if not for slightly higher than expected partnership share of revenue and its related cost of sales, as well as investments in an ambitious product roadmap.

Elliot: From acquired intangible assets from the Alts holdings and <unk> acquisitions.

Operating expenses also absorb the cost base of the Alts Holdings acquisition.

Elliot: Excluding the noncash acquisition related amortization.

Elliot: Both in operating expenses was well under our revenue growth hopefully percent hooky law.

Elliot: Adjusted EBITDA increased 56% year over year to another all time record of $15 9 million compared to $10 2 million a year ago.

Elliot: First quarter adjusted EBITDA margin was 39% up 400 basis points from 35% in the year ago period.

Elliot: First quarter adjusted EBITDA margin would have been even higher if not for slightly higher to unexpected partnership share of revenue.

Elliot: It's related to cost of sales.

As well as investments in an ambitious product roadmap.

Elliot: Typical softer seasonality combined with product investments will naturally result in sequentially lower margins in the second quarter.

Elias Mark: Typical softer seasonality combined with product investments will naturally result in sequentially lower margins in the second quarter, before expanding in the second half of the year, as we move into the seasonally stronger sports calendar and our current wave of product investments start tomorrow. Adjusted net income for the first quarter of 2025 rose 78% to $16.5 million from the year-ago period. Adjusted net income was positively affected by the strengthening of the euro versus the US dollar when translating balance sheet items at quarter. Adjusted diluted net income per share increased 92% to 46 cents from the year ago.

For expanding in the second half of the air.

Elliot: As we move into the seasonally strongest sports calendar and our current wave of product investments start to bear fruit.

Elliot: Adjusted net income for the first quarter of 2025 rose, 78% to $16 5 million from the other period.

Elliot: Adjusted net income was positively affected by the strengthening of the euro versus the U S dollar on translating.

Elliot: Translating balance sheet items ask what right.

Elliot: Okay.

Elliot: Adjusted diluted net income per share increased 92% to 46 cents from the yoga period.

Elias Mark: As a reminder, in Q4 we revised the way we define adjusted net income to more closely align adjustments we make to adjusted EBITDA. This is to improve the like-for-like comparability between periods. free cash flow was 10.3 million up 25% from the earlier period. Pre-Cash Flow in Q1 reflects strong growth in Adiocitibita, partly offset by the timing of tax payments and working capital movements related to the settlement of transaction expenses for the odds holdings acquisition. As of March 31st, we have a total cash of $21.5 million and $70.5 million of undrawn capacity on our credit results.

Elliot: As a reminder, in Q4, we revised the way we define adjusted net income to more closely align adjustments, we make to adjusted EBITDA.

Elliot: It is doing pretty good like for like comparability between periods.

Elliot: Free cash flow was $10 3 billion up 25% from the yoga period.

Elliot: Free cash flow in Q1 reflects strong growth in adjusted EBITDA, partially offset by the timing of tax payments.

Elliot: And working capital movements related to the settlement of the transaction expenses, what else Holdings acquisition.

Elliot: As of March 31, we had total cash of $21 5 million and 70.

Elliot: $5 million Undrawn capacity on our credit facility.

Elliot: On April 4th we made the final payment of $11 2 million for the three best Dot Com acquisition using cash balances.

Elias Mark: On April 1st, we made a final payment of $11.2 million for the FreeBets.com acquisition using cash balance. In total, we have drawn 94.5 million on our 165 million credits or so.

Elliot: In total we have drawn $94 5 million on our $165 million credit facility.

Elliot: Okay.

Elias Mark: Effective on April 1st, we entered into a swap agreement to effectively convert our 75 million of U.S. dollar term loan to euro borrowing. is lowered our cost of debt capital by approximately 200 basis The swap transaction also aligned our borrowings with our functional currency. eliminating the corresponding forex translation effects in our income statement moving forward.

Elliot: Effective on April 1st we entered into a swap agreement to effectively come back our $75 million.

Elliot: U S dollar term loan to euro borrowings.

Elliot: This lowered our cost of debt capital by approximately 200 basis points.

Elliot: The swap transaction also aligned our borrowings with our functional currency.

Elliot: Eliminating the corresponding Forex translation effects in our income statement moving forward.

Elliot: Our free cash flow and borrowing capacity continues to provide the flexibility to pursue both acquisitions and to optimize our capital structure to maximize shareholder value overtime.

Elias Mark: Our free cash flow and borrowing capacity continues to provide the flexibility to pursue both acquisitions and to optimise our capital structure to maximise shareholder value over time. as Charles noted this morning. We reiterated our full-year guidance with a midpoint of our revenue guidance of $172 million, representing 35% year-over-year growth. The midpoint of our adjusted EBITDA guidance of 68 million represents 40% year-over-year. This guidance assumes the resumption of growth in North American marketing business. Continued global market share gains. as well. and well over 20% of full year revenue coming from recurring subscriptions.

Elliot: Yeah.

Elliot: As Charles noted this morning.

Elliot: We reiterated our full year guidance with the midpoint of our revenue guidance of $172 million, representing 75% year over year growth.

Elliot: The midpoint of our adjusted EBITDA guidance of $68 million represent 40% yet.

Elliot: Got it.

Elliot: This guidance assumes there was some channel growth in North America and marketing business.

Elliot: Continued global market share gains.

Elliot: As well.

Elliot: And well over 20% of full year revenue coming problem.

Elliot: Recurring subscriptions.

Elliot: As usual our guidance does not include contributions from any new acquisitions or adding new market launches.

Elias Mark: As per usual, our guidance does not include contributions from any new acquisitions or any new market launch. While we expect Missouri to launch sports betting in the second half of this year, as per our policy, we will not include it in guidance until the launch date is confirmed. Our guidance also assumes an average EUR to USD exchange rate of 1.

Elliot: While we expect the Missouri to launched sports betting in the second half of this year as per our policy. We will not include it in guidance until the launch date is confirmed.

Elliot: Our guidance also assumes an average euro to USD exchange rate of one.

Operator: 10 4 Operator, we will now turn the goal forward. Thank you.

Elliot: 10 for the year.

Speaker Change: Operator, we will now turn the call for questions.

Speaker Change: Thank you we will now be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.

Operator: We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star 2 if you would like to remove your question from the queue.

Speaker Change: A confirmation tone will indicate your line is in the question queue you.

Speaker Change: You May press Star two if you would like to remove your question from the queue. We ask that analysts limit themselves to one question and a follow up so that others may have an opportunity to do so.

Operator: We ask that analysts limit themselves to one question and a follow-up so that others may have an opportunity to do so. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star 2. One moment, please, while we poll for questions.

Speaker Change: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.

Speaker Change: One moment, please while we poll for questions.

Speaker Change: Yeah.

Speaker Change: Our first question comes from Ryan <unk> with Craig Hallum Capital Group. Please proceed with your question.

Ryan Sigdahl: Our first question comes from Ryan Sigdahl with Craig Salem Capital Group. Please proceed with your question. Hey, good morning, Charles, Elias. Really solid results, especially given what your peers have reported the past couple days and said.

Ryan: Hey, good morning, Charles Elliott really solid results, especially given.

Ryan: What your peers have reported the past couple of days and said so why don't want to start with kind of an industry topic across not just your own industry, but many but AI search it's growing interest from consumers for this chat GPT perplexity et cetera.

Charles Gillespie: So I want to start with kind of an industry topic across, you know, not just your own industry, but many, but AI search. It's growing interest from consumers, whether that's chat, GPT, perplexity, etc. Apple also reported browser search was down in April for the first time. So curious, I guess, what gambling.com is doing to keep its content in focus as they're still consumer demand, but as that behavior is changing and how they're. And do you view this as an opportunity or...

Ryan: <unk> also reported browser search was down in April for the first time. So curious I guess, what gambling dot com is doing to keep its content infocus as theres still consumer demand, but as that behavior is changing and how they're viewing content finding content and do you view this as an opportunity or a risk.

Speaker Change: Good morning, Brian.

Charles Gillespie: Morning, Ryan. To give some context here, Apple executive Eddie Cue stated in a court hearing that from Apple's perspective, search volume on Safari had peaked in April. Google immediately shot back with a statement contradicting this, saying that they continue to see search volumes climb from Apple's devices, and Google reported a 10% increase in global search volume in Q1. From our perspective, we are seeing all-time high revenue from our marketing business, which continues to be fundamentally driven by natural search from Google, and we are not seeing any pullback or fundamental shift in search volume. Now, having said all that, we do continue to see more and more referrals from these generative AI experiences like ChazUBT and Perplexity.

Ryan: To give some context here.

Speaker Change: <unk> executive at EQ stated in a court hearing that from Apple's perspective search volume on Safari had peaked in April.

Speaker Change: Google immediately shot back with a statement contradicting this saying that they continue to see search volumes climb from Apple devices, and the reported a 10% increase in global search volume in Q1.

Speaker Change: From our perspective, we are seeing all time high revenue from our marketing business, which continues to be fundamentally driven by natural search from Google and we are not seeing any pullback or a fundamental shift in search volumes.

Speaker Change: Now having said all that we do continue to see more and more referrals from these generative AI experiences like church EBT and complexity. The chart is.

Charles Gillespie: Hockey stick, basically. But starting from, you know, it was zero a couple of years ago, so starting from a low base, but it's growing very, very quickly. And that traffic is very high intent. It's similar, but really even better, even more high intent than the traffic we get from Google search. It feels incremental, given that the level of referrals from natural search is not falling. Users using these AI tools have a deeper relationship with the tool than a simple drive-by search. They give context, they ask specific questions, they steer the conversation where they need it to go.

Speaker Change: Hockey stick basically.

Speaker Change: But starting from.

Speaker Change: Zero, a couple of years ago, starting from a low base, but it's growing very very quickly.

Speaker Change: That traffic is very high intent, it's similar but really even better even more high intent and the traffic we get from Google search.

Speaker Change: And it feels incremental.

Speaker Change: Given that the level of referrals from natural search is not falling.

Speaker Change: Users using these AI tools have a deeper relationship with the tool that is simple drive by search they give context. They ask specific questions. They steer the conversation where they needed to go.

Charles Gillespie: And almost by definition, they are more high intent, given the increased effort required and the longer engagement. provided by the conversation. So, you know, we love high intent traffic and we are indifferent as to the source of it, to the extent that more and more of this high intent traffic arrives via these tools, these AI tools. It reduces reliance on the Google organic search channel. And I've been thinking a lot recently about all of this, as I'm sure a lot of people in digital marketing have.

Speaker Change: And almost by definition there are more high intent.

Speaker Change: Given the increased.

Speaker Change: Effort requires and the longer engagement.

Speaker Change:

Speaker Change: Provided by the conversation so we love high intent traffic and we are indifferent as to the source of it.

Speaker Change: To the extent that more and more of this high intent traffic arrives via these tools. These AI tools a.

Speaker Change: It reduces reliance on the Google organic search channel.

Speaker Change: And I've been thinking a lot recently about all of this as I'm sure a lot of people in digital marketing have an yeah.

Charles Gillespie: And I'll add that the monetization paradigm of these tools seems to be the opposite of Google, where users are happy to pay for the service outright, obviating the need for the AI tool to monetize the actual content provided to the user. You know, if we allow ourselves to be optimistic here. This could be a boon for people like us, publishers of high quality content and mark the beginning of a new era online where advertising is simply less central to the experience. You know, at the end of the day, there's there are alternatives to Google search, but all the all the alternative all the other search products have ads.

Speaker Change: Yeah, I'll add that the monetization paradigm of these tools seems to be the opposite of Google where users are happy to pay for the service outright.

Speaker Change: <unk> the need for the AI tool to monetize the actual content provided to the user.

Speaker Change: We allow ourselves to be optimistic here.

Speaker Change: This could be a boon for people like us publishers of high quality content and be marks the beginning of a new era online where average right advertising is simply less central to the experience.

Speaker Change:

Speaker Change: But.

Speaker Change: You know at the end of the day. There is there are alternatives to Google search, but all the all the alternatives all the other search products have ads.

Speaker Change: Yeah.

Charles Gillespie: But these generative AI experiences, there's no ads. So, you know, kind of all the traffic is organic. It's like it's almost a cleaner, more direct relationship with the consumer. Um, so The numbers are great. We're still making a ton of money from Google natural search. We're now also making money off of these generative AI experiences. And we're pretty excited about the future. Helpful context.

But these generative AI experiences.

Speaker Change: No ads, so kind of all the traffic is organic it's like it's almost a cleaner more direct relationship with the consumer.

Speaker Change: So.

Speaker Change: The numbers are great, we're still making a ton of money from Google Natural search. We're now also making money off of these generative AI experiences in.

Speaker Change: We're pretty excited about the future.

Speaker Change: Helpful context, I don't want to switch over to optic gods. You mentioned some success there last quarter, you mentioned kind of the top per asset at optic gods was in Malta running through gambling Dotcoms Global client list I'm curious for any updated details anything you can share there on how those conversations.

Ryan Sigdahl: I want to switch over to Optic Odds. You mentioned some success there. Last quarter, you mentioned kind of the top brass at Optic Odds was in Malta running through Gambling.com's global client list. Curious for any updated details, anything you can share there on how those conversations and that cross Yeah.

Speaker Change: And that cross sell is going.

Speaker Change: Yes.

Speaker Change: Yes.

Charles Gillespie: OpticOz is flying. It's certainly the highest. It's certainly growing. I mean, OzJam is also obviously growing, but OpticOz is growing even faster. It's probably the fastest growing piece of our entire business.

Speaker Change: I'll take I'll just flying.

Speaker Change: It is certainly the highest Ah it's certainly growing odds James also is obviously growing but off the gods is growing even faster.

Speaker Change: We believe the fastest growing piece of our entire business.

Charles Gillespie: I think that trip was productive and eye-opening. And we just hired a senior salesperson based in London to help distribute that product more in Europe. We've had one quarter. It's still very early, but the plans and Hiring and Roadmapper are well in motion, and we expect the growth there to continue at a high level for some time.

Speaker Change: I think that trip was was productive and eye opening.

Speaker Change: We've just hired a senior sales person based in London to help distribute that product more broadly in Europe.

Speaker Change: So.

Speaker Change: We've had one quarter right, it's still very early but the plans.

Speaker Change: Hiring and roadmap R. R.

Speaker Change: Well in motion and we expect the growth there to continue at a high level for some time.

Speaker Change: Excellent Thanks, Charles and good luck guys.

Ryan Sigdahl: Excellent. Thanks, Charles, and good luck, guys.

Speaker Change: Our next question comes from Jeff Van <unk> with Stifel. Please proceed with your question.

Jeffrey Stantial: Our next question comes from Jeff Stantial with Steeple. Please proceed with your question. Hey, good morning, Charles, Elias. Thanks for taking our questions.

Jeff Van: Hey, good morning, Charles all these thanks for taking our questions.

Speaker Change: I wanted to ask what we heard from <unk>.

Jeffrey Stantial: I want to ask, we heard from Penn last week that they were turning back on performance marketing after leaning primarily on ESPN and reactivations for a handful of quarters. I'm curious if this specifically has been a material growth driver so far, and then, you know, more broadly, just how you think about the potential for other operators to start to dig in a bit deeper here, just as some lower CAG channels get exhausted or sort of start to naturally decelerate.

Speaker Change: And last week that they were turning back on performance marketing after leaning primarily on ESPN and reactivation for a handful of quarters I'm curious if this specifically it's been a material growth driver. So far and then more broadly just how you think about the potential for other operators to start to dig in a bit deeper here just as some some lower CAC.

Speaker Change: Animals get get exhausted or starts sort of start to naturally decelerate.

Speaker Change: Good morning, Jeff. Thanks for a tremendous question very happy to answer that that would be consistent with our.

Charles Gillespie: Good morning, Jeff. Thanks for a tremendous question. Very happy to answer that. That would be consistent with our entire experience of having run this business for 19 years around the world. These operators, obviously, if you can acquire customers cheaply, you do it, but as you say, those channels get exhausted, gets more competitive, all the low-hanging fruit is plucked, and then where do you find players? Well, the affiliate channel. There's a reason it is central and fundamental to all these operators' marketing strategies and all of these different markets around the world. So to us, it's absolutely no surprise whatsoever that an operator like Penn would reach this conclusion.

Speaker Change: Our entire experience with having run this business for 19 years around the world.

Speaker Change: Operators, obviously, if we can acquire customers cheaply you do it but as you say those channels get exhausted.

Speaker Change: It's more competitive all the low hanging fruit is plots and then where do you find players well the affiliate channel. There's a reason it is central and fundamental to all these operators as marketing strategies and all of these different markets around the world So to us it's absolutely no surprise whatsoever.

Speaker Change: And operator like Penn would reach this conclusion.

Charles Gillespie: If anything surprising, it's that it took them as long as it did to reach that conclusion. But Penn's a client that wouldn't be an enormous client at this exact moment in time. They have been an enormous client in the past, particularly around the point when ESPN vet launched. But we welcome, of course, any increase in demand from our customers. That's great. Thanks for that, Charles.

Speaker Change: If if if anything surprising instead it took them as long as it did to reach that conclusion.

Speaker Change: Penn Penn to client there wouldn't be an enormous client at.

Speaker Change: At this exact moment in time, they have been an enormous client in the past, particularly around the point when ESPN that launched.

Speaker Change: But we welcome of course any increase in demand from our customers.

Speaker Change: Okay. That's great. Thanks for that Charles and then and then turning over to guidance at least I think you said the assumption for the Euro went from 107% last quarter to 110 could you just quantify for us the impact from the higher euro on the actual revenue and the EBITDA guidance and then I just I guess should we be interpreting.

Jeffrey Stantial: And then turning over to guidance, Elias, I think you said the assumption for the euro went from 107 to the last quarter to 110.

Elias Mark: Could you just quantify for us the impact from the higher euro on the actual revenue and the EBITDA guidance? And then I guess should we be interpreting?

Elias Mark: the reiteration of guidance to mean that you might have been tracking more to the lower end if the euro didn't didn't kind of help out here or maybe now you are tracking above the midpoint with the benefit of fx just any any help there kind of thinking about the i guess the constant currency implications would be would be great thanks Yeah, a couple of things there. Obviously, it's very hard to guide on future Forex movement expectations in the current market. It's been very volatile. If we look at Q1, we had big positive translation effects from balance sheet items at the end of the quarter.

Speaker Change: The reiteration of guidance to mean that you might have been tracking more to the lower end if the euro didn't didn't kind of help out here or maybe not where you are tracking above the mid point with the benefit of FX just any any help there kind of thinking about that I guess the constant currency applications would be would be great. Thanks.

Speaker Change: Yes, a couple of things there.

Speaker Change: Obviously, it's very hard to guide on on the Forex.

Speaker Change: Forex movement expectations.

Speaker Change: Current market has been very volatile.

If we look at Q1.

Speaker Change: Big positive translation effects from balance sheet items.

Speaker Change: The.

Speaker Change: At the end of the quarter, but if you look at the P&L.

Elias Mark: But if you look at the P&L, we didn't see any big positive effects because the average rate was more or less in line with our expectations. We've assumed 110 for the remainder of the year. That's, you know, it could go above, it could go below. I would note that a much higher proportion of both our revenue and our operating expenses are denominated in US dollars now after the last few years of acquisitions. So any positive or negative effects from movements have less of an effect than they would have had last year or two years ago.

Speaker Change: We didn't we didn't see any and if they get a positive effect because the average rate to us was more or less in line with our expectations.

Speaker Change: We've assumed 110 for the remainder of the year.

Speaker Change: Yeah.

Speaker Change: Yes.

Speaker Change: Could go Abawi could go below.

Speaker Change: I would note that.

Speaker Change: At.

A much higher proportion of our both our revenue and our operating expenses are denominated in U S dollars now after.

Speaker Change: The last few years so acquisitions.

Speaker Change: Positive or negative effects from forest and the unions have less of an effect than they would have had.

Speaker Change: Last year or two years ago.

Speaker Change:

Speaker Change: Yes.

Elias Mark: As you noted, you know, we have moved up marginally the assumption from the Euro to USD rate, which has a slight positive effect on our revenue, but it's not big enough to move the needle and nothing has really fundamentally changed in our revenue expectations or EBITDA expectations for the That's great.

Speaker Change: Note that we have moved up marginally the assumption from the euro to USD rate.

Speaker Change: Which.

Speaker Change: <unk> has a slight pulse.

Speaker Change: Pulse of David hit that at all.

Speaker Change: On our revenue, but it's not big enough to move.

Speaker Change: E Mail and nothing has really fundamentally changed in our revenue expectations or EBITDA expectations for the balance of the year.

Speaker Change: That's great. Thank you both I'll pass it on.

Jeffrey Stantial: Thank you both. I'll pass it on.

Speaker Change: Our next question comes from Barry Jonas with Truth Securities. Please proceed with your question.

Barry Jonas: Our next question comes from Barry Jonas with True Securities. Please proceed with your question.

Barry Jonas: Hey, guys I wanted to see if he'll share any thoughts on what the path could look like to get to your $100 million EBITDA goal and I really I mean any color on business line of product composition what M&A.

Barry Jonas: Hey guys, I wanted to see if you'll share any thoughts on what the path could look like to get to your 100 million EBITDA goal, you know, really any color on business line or product composition, what M&A means to getting there, and then timing would be would be helpful. Thanks. Morning, Barry. Well, with guidance this year, putting us on 68 million at the midpoint, you know, we're We're going to be 68% of the way there this year. Obviously, we do do M&A. That's the big delta here. If we find another acquisition that ticks all the right boxes for us, and reminder, we're very picky about M&A, then it could shorten the timeline meaningfully.

Barry Jonas: Means to getting there and then timing would be would be helpful. Thanks.

Barry Jonas: Good morning, Barry Ah well.

Barry Jonas: Well with guidance this year.

Barry Jonas: Putting us on $68 million at the midpoint.

Barry Jonas: We're gonna be 68% of the way there are this year.

Barry Jonas: Obviously, we do do M&A.

Barry Jonas: That's the big Delta here, if we find another acquisition that ticks all the right boxes for US and reminder, we're very picky about M&A.

Barry Jonas: Then it could shorten the timeline meaningfully, but we're still a high growth business, even without M&A. So.

Charles Gillespie: But we're still a high-growth business even without M&A. So with a nice acquisition, it could happen Very soon. But without that, it would, you know, all things equal take another year or two. So we don't want to put a specific year on it. But, you know, it doesn't take a whole lot of imagination to see that we could get there pretty quickly if we did a another acquisition of meaningful size. Got it, got it.

Barry Jonas: With a with a with a nice acquisition it could happen.

Barry Jonas: Very soon.

Barry Jonas: But without that it would all things equal will take another year or two so we don't want to put a specific year on it but it doesn't take a whole lot of imagination to see that we could get there pretty quickly. If we did another acquisition of meaningful size.

Barry Jonas: Got it got it and then just for a follow up on the OSB side, they're saying investor concerns around decelerating handled trends for North American operators.

Barry Jonas: And then just for a follow up, on the OSV side, there's been investor concerns around decelerating handle trends for North American operators. You know, I think you've talked about this in the past, but one, are you seeing anything concerning there? And two, what's your latest thinking about red share versus CPA mix in the current environment?

Barry Jonas: I think you've talked about this in the past, but what are you seeing anything concerning there and two what's your latest thinking about Rev share versus CPA mix in the current environment. Thanks.

Charles Gillespie: Thanks. Okay, on yeah, there was some stats around NBA. and GGR that were down year on year. There's no read through on that to the rest of the American OSB market. I think that's an NBA specific phenomenon. Everything we're seeing, all the data supports the fact that in Q1, OSB grew. 15% nationally in the U.S. iGaming grew substantially faster than that still. So, you know, zero concerns. You know, it's a little, it's a curious data point, but zero concerns. In terms of RepShare and CPA, I mean, we... You know, nothing's fundamentally changed. We remain philosophically agnostic as to the benefits of either one of those.

Barry Jonas: Okay. Yeah, there was some stats around M B a.

Barry Jonas: G. G are they were like down year on year. There is no read through on that to the rest of the American OSB market I think thats. The NBA specific phenomenon everything we're seeing all the data supports the fact that in Q1 OSV grew.

Barry Jonas: Like 15% nationally in the U S. I gaming grew substantially faster than that still so you know.

Barry Jonas: Zero concerns.

Barry Jonas: It's a curious data point, but zero concerns.

Barry Jonas: In terms of Rev share and CPA I mean, we.

Barry Jonas: Nothing has fundamentally changed we remain philosophically agnostic as to the.

Barry Jonas: Benefits of either one of those.

Charles Gillespie: What we do is model it. You know, we use our sophisticated data science teams to estimate the value of all the deals available to us, and then we pick the one that we think will make us the most money. Now, having said that, We, you know, we, this year, we expect, you know, 25% of group revenue to come from recurring subscription revenue, you know, so that's B2B enterprise sales and that's B2C customer subscriptions. stuff like Optica, Zodjam, and then, you know, RotoWire itself has a data services business. But when you look beyond that and you include the kind of recurring proportion of our marketing business, whether it's a pure revenue share deal or it's a hybrid deal and a portion of it is revenue share, you get to, from our seat here, looking at the full year, we expect over half of group revenue.

Barry Jonas: What we do is model. It you know we use our sophisticated.

Barry Jonas: Data science teams to estimate the value of.

Barry Jonas: All the deals available to us and then we pick the one that we think will make us the most money now.

Barry Jonas: Now having said that.

Barry Jonas: We.

Barry Jonas: This year, we expect.

Barry Jonas: 25% of group revenue to come from recurring subscription revenue. So that's b to B enterprise sales and that's b to C customers.

Barry Jonas: Customer subscriptions.

Barry Jonas: Stuff like offer goddamnit than roto wire itself has the data services business.

Barry Jonas: But when you look beyond that and you include the kind of recurring proportion of our.

Speaker Change: Marketing business, whether it's a pure revenue share deal or it's a hybrid deal and a portion of it is revenue share you get too but from our seat here looking at the full year, we expect over half of group revenue. So it's another 25% of revenue.

Charles Gillespie: So it's another 25% of revenue is recurring in that nature. So total group revenue, which is recurring in one way or another, is going to be more than half of group revenue this year. But again, we're not specifically targeting that. We're not trying – it's not a specific goal of ours to grow that. That recurring proportion of our marketing revenue, but it naturally builds up and grows as you know, it is frequently the best monetization vehicle available to us.

Speaker Change: Is recurring and that nature. So total group revenue, which is recurring in one way or another is going to be more than half of group revenue. This year.

Speaker Change: But again, we're not specifically targeting that we're not trying to sort of the specific goal of ours to grow that.

Speaker Change: That recurring proportion of our marketing revenue, but it naturally.

Speaker Change: Builds up and grows as you know it is frequently.

Speaker Change: Best monetization vehicle available to us.

Charles: Thank you Charles I appreciate it.

Charles Gillespie: Thank you, Charles. Appreciate it.

Speaker Change: Our next question comes from David Katz with Jefferies. Please proceed with your question.

David Katz: Our next question comes from David Katz with Jeffrey's. Please proceed with your question. Hey, good morning. Thanks very much.

David Katz: Hey, good morning, Thanks very much.

David Katz: Charles, you are, I believe, in a unique position to opine and, you know, convey what you're seeing with respect to the topic of handled growth. There obviously is a bit of a debate at the moment about what the trajectory of U.S. handle growth is looking like, and I would just welcome your perspective on how you would characterize the growth and handle in the U.S. I think there's a lot of cross currents under the surface, which are making it a little more confusing for people to understand, but what's happening, but fundamentally in aggregate, the market's growing.

David Katz: Charles you you are I believe in a unique position to opine and convey what youre seeing with respect to the topic of handle growth.

David Katz: There, obviously is a bit of a debate at the moment about what the trajectory of U S handle growth is looking like.

David Katz: And I and I would just welcome your perspective on sort of how you would characterize the sort of growth in and handle in the U S. Please.

David Katz: Yeah, I think theres a lot of cross currents under the surface, which are making it a little more confusing for people to understand but.

David Katz: That that mix shift is whats happening.

David Katz: But fundamentally in aggregate the market is growing I mean, we were.

Charles Gillespie: I mean, we've got an interesting and unique perspective, but at the same time, we follow a lot of these industry data sources, and all of those are pointing to double-digit gains in Q1 OSB growth. So we're certainly not seeing any slackening in our business, but we're doing a lot more with things like same-game parlays. That's a product which is a home run for the operators. They want that traffic. They're now very actively looking for it, and they want to collaborate with companies like ours to give them more of that type of traffic specifically. So we've built on the back of our fantastic technology stack a variety of really interesting same-game parlay tools, which are available across different sites of ours, and that's helping drive more engagement on that type of product.

David Katz: Sure.

David Katz: We've got an interesting and unique perspective, but at the same time, we follow a lot of these industry data sources and all of those are pointing to double digit gains in Q1 OSB growth. So.

David Katz: We're certainly not seeing any slackening in in our business, but we're doing a lot more with things like.

David Katz: Same game Parlays, you know, that's a product which is a homerun for the operators they want that traffic, they're now very actively looking for it and they want to collaborate with companies like ours to give them more of that type of traffic specifically so we've built.

David Katz: On the back of our Fantastic technology stack, a variety of really interesting same game parlay tools.

David Katz: Which are available across different sites of ours, and that's helping drive more engagement on that type of product, but I think it's just getting kind of more complicated but in aggregate, it's very clearly still growing.

David Katz: But yeah, I think it's just getting kind of more complicated, but in aggregate, it's very clearly still growing. Understood.

Speaker Change: Understood and if I can just ask maybe an easier one saw a bit of news about perhaps gaming legalization I believe it was in Ohio.

David Katz: And, you know, if I can just ask maybe an easier one, you know, saw a bit of news about, you know, perhaps iGaming legalization, I believe it was in Ohio. Can you maybe just give us an update on your board of, you know, sort of iGaming legislation, if you think we may get some this year? I know it's everyone has their own sort of opinions about it, but yours is highly valuable. Yeah. Yeah, I mean, it has been a little quieter this year than I think we all would have liked. The developments to Ohio are positive.

Speaker Change: Can you maybe just give us an update on your board of.

Speaker Change: Sort of I gaming legislation. If you think we may get some this year I know everyone has their own sort of opinions about it but yours is it's highly valuable.

Speaker Change: Yeah.

Speaker Change: Yeah.

Speaker Change: It has been a little quieter this year that I think we all would have liked.

Speaker Change: Developments in Ohio are positive and what I really like about the Ohio approaches that they're they're talking about sweeping reform and having one regulator regulate a rebooted gaming economy, it's not you're not going to.

Charles Gillespie: And what I really like about the Ohio approach is that they're talking about sweeping reform and having one regulator regulate a rebooted gaming economy. You know, it's not you're not going to have three or four different regulators. You can have one new one, which is going to oversee the whole thing, which is absolutely the right way to do it. This isn't news. We know this already. All you have to do is look at all the various examples from around the world. So, look, that would be great. Ohio is a great market, you know, competitive market, lots of different operators.

Speaker Change: I have three or four different regulators you can have one new one which is going to oversee the whole the whole thing was absolutely the right way to do it. We this isn't news we know this already all you have to do is look at all the various examples from around the world. So that would be great, Ohio is a great market competitive market lots of different operators.

Charles Gillespie: That would be clearly a really nice step in the right direction.

Speaker Change: That would be clearly a.

Speaker Change: Really nice step in the right direction, but.

Speaker Change: Nobody has asked about prediction markets, yet, but that's kind of related here because the legal situation with these predictions prediction markets is getting incrementally more clear.

Charles Gillespie: But nobody's asked about prediction markets yet, but that's kind of related here. The legal situation with these prediction markets is getting incrementally more clear. which means that category is gonna grow very rapidly and the tax rate is zero. So that's dramatically more interesting from a business perspective than paying these sometimes very high state gaming duties, which some states are even trying to increase. So it's a really interesting one to watch and the big operators out there are certainly looking into it and evaluating the feasibility of providing their products and services under that regulatory regime, which look, I think it just keeps, it's gonna keep everybody honest, right?

Speaker Change: Which means that category is going to grow very rapidly and at the tax rate is zero.

Speaker Change: So that's dramatically more interesting from a business perspective than paying these.

Speaker Change: Sometimes very.

Speaker Change: Very high state gaming.

Speaker Change: Duties, which some states or even trying to increase so it's a really interesting one to watch and you know the big operators are out there are certainly looking into it and evaluating the feasibility of of providing their products and services under that regulatory regime, which I look I think it just keeps its going to keep everybody.

Speaker Change: Honest right.

David Katz: It forces the state gaming regulators to Think about everybody's economics here and make sure that they're competitive in the broader marketplace. Understood. I have more, but I'll come back around. Thanks.

Speaker Change: It forces the state gaming regulators to.

Speaker Change: To.

Speaker Change: Think about everybody's economics here and make sure that the.

Speaker Change: They are competitive in the broader marketplace.

Rob: Understood I have more but I'll come back Rob Thanks.

Speaker Change: Our next question comes from Clark Lam with BTG. Please proceed with your question.

Clark Lampen: Our next question comes from Clark Lampen with BTIG. Please proceed with your question. Thanks. Good morning. My first question is sort of a follow-up on iGaming in the U.S. I'm curious if you could give us an update on casinos.com, where you are in the process of sort of building domain authority, traffic, and if there's any way that you guys have sort of thought about, you know, revenue upside or how that brand might perform when you start to get into, in earnest, an iGaming legalization cycle in the U.S. The second question that I have is going back to, I think, some questions that were asked earlier around the $100 million EBITDA target.

Clark Lam: Thanks, Good morning.

Clark Lam: My first question is sort of a follow up on gaming.

Clark Lam: The U S. I'm curious if you could give us an update on.

Clark Lam: Casinos Dot com, where you are in the process of sort of building them.

Clark Lam: Maintenance already traffic and.

Clark Lam: If there is any way that you guys have sort of thought about.

Clark Lam: Revenue upside or how that brand might perform when you start to get into an earnest gaming legalization cycle in the U S. Second question that I have is going back to I think some questions that were asked earlier around.

Clark Lam: The $100 million EBITDA target I'm curious I know this year.

Clark Lampen: I'm curious. I know this year, Odds Jam and I think the sort of newer subscription businesses that you've been building out are going to represent something like 25% of overall mix, if I heard you correctly earlier. Have you thought about or tried to dimensionalize when you reach $100 million, whether it is revenue or EBITDA, where should the relative mix of sort of performance and, I guess, kind of, you know, if you were to bucket it broadly, non-performance businesses land?

Clark Lam: Dan and I think the sort of newer subscription businesses that you've been building out are going to represent something like 25%.

Clark Lam: Of overall mix, if I heard you correctly earlier.

Clark Lam: You started out.

Clark Lam: Or tried to Dimensionalize when you reach $100 million, whether it is revenue or EBITDA, where should the relative mix of sort of performance and I guess kind of if you were to bucket. It broadly nonperformance businesses land. Thanks a lot.

George: Good morning, George.

Charles Gillespie: Morning, Clark. So we're here in Charlotte at the moment. We had our big management summit earlier this week and got updates from all the teams, including casinos.com. And we've got some very, very interesting stuff coming up in the pipe with, with casinos.com that, you know, it's, we're trying to develop a unique tone of voice with that product. And yeah, they've got like comedians involved to write some of the content and just, you know, meaningfully differentiated from other products. And, and our portfolio, they're doing a lot of creative and interesting stuff. And the numbers are, the numbers are, are, are trending up very nicely in the past six months.

George: So we're here in Charlotte at the moment, we had a big management summit earlier this week and got updates from all the teams, including casinos Dot Com and Oh, we've got some very very interesting stuff coming up in the pipe with with casinos Dot com.

George: We're trying to develop a unique tone of voice would that products and.

Speaker Change: Yeah, they've got like comedians involved to write some of the content and just.

Speaker Change: Meaningfully differentiated from other products in our portfolio.

Speaker Change: They're doing a lot of creative and interesting stuff and the numbers are numbers are are trending up very nicely in the past six months.

Charles Gillespie: You know, it's a, it's a young, still young product and still has some ways to go, but it's, it's, we're doing all the right things. It's very much headed in the right direction. And, you know, they're doing really cool stuff. Like, for example, today, May 15th, they have declared with the help of the mayor of Las Vegas, International Casinos Day. So this is a big kind of PR push by the casinos.com team to, to leverage that, that brand and, and, uh, Get exposure around the world and not just in the U.S. That's the other thing to bear in mind is Consumers.com.

Speaker Change: So yes, it's still a young product still has some ways to go but it's we're doing all the right things as very much headed in the right direction and they.

Speaker Change: They're doing really cool stuff like for example today.

Speaker Change: May 15th they have declared with the help of the mayor of Las Vegas International Casinos day. So this is a big kind of PR push by the casinos dot com team to to leverage that that brand in ER.

Speaker Change: You know get exposure around the world and not just in the U S. That's the other thing to bear in mind as casinos Dot com.

Charles Gillespie: Of course, it has U.S. revenue, but it's a global product. There's a lot of consumers around the world. On the $100 million in margins, the Odd Jam and Optic Odds business, when we bought it, had actually slightly higher adjusted EBITDA margins than our marketing business. It's an incredible business, and we don't see that fundamentally changing. So when you get to... A hundred million in adjusted EBITDA, you know, okay, you know, if you look at the figures today, okay, it's twenty-five. 25% of the business, it's growing faster than the marketing business. So maybe it's 30, 35, or 40% of the business, but the margin profile is fundamentally the same.

Speaker Change: Of course, it is U S revenue, but it's a.

Speaker Change: Global product because there's a lot of casinos around the world.

Speaker Change: On the $100 million and margins.

Speaker Change: You know the odds you have an off the cards business had when we bought it it had actually slightly higher.

Speaker Change: Adjusted EBITDA margins than our marketing business is an incredible business.

Speaker Change: We don't see that fundamentally changing so when you when you get to.

Speaker Change: $100 million and adjusted EBITDA, you know okay.

Speaker Change: If you look at the figures today, Okay. It's 'twenty.

Speaker Change: Yeah.

Speaker Change: 25% of the business it is growing faster than the marketing business. So maybe it's 30% 35 or 40% of the business, but the margin profile is fundamentally the same so I'd expect the margin profile of the sports data services to be.

Clark Lampen: So I'd expect the margin profile of the Sports Data Services to be, you know, the contribution to Justin Bieber's out to be 30, 35, or 40 million, depending on how that plays out. But, you know, incrementally more than the marketing business. Thank you.

Speaker Change: The contribution to adjusted EBITDA to be 30, 35 or $40 million, depending on how how that plays out but it incrementally more than the than the marketing business.

Speaker Change: Thank you.

Chad Beynon: Our next question comes from Chad Beynon with McCrary. Please proceed with your question. Morning, thanks for taking my question. Nice results. I wanted to ask about Brazil. I feel like we've heard from some of the operators down there that it's been a little bit of a slower start than anticipated, yet everyone still has, you know, pretty high total addressable market sizing for that market. What are you seeing? I know that it's a big market with a lot of different operators, which I think is probably the best model for you guys. But are you working with different partners?

Speaker Change: Our next question comes from Chad Beynon with Macquarie. Please proceed with your question.

Chad Beynon: Good morning, Thanks for taking my question and nice results I wanted to ask about Brazil, I feel like we've heard from some of the operators down there that it's been a little bit of a slower start.

Chad Beynon: Than anticipated yet everyone still has pretty high total addressable market.

Chad Beynon: Sizing for that market.

Chad Beynon: What are you seeing I know that's a it's a big market with a lot of different.

Chad Beynon: Operators, which I think is probably the best model for you guys, but are you working with different partners I know, it's going to be a long haul there and how have your expectations for 2025 change.

Chad Beynon: I know it's going to be a long haul there. And how have the expectations for 2025 changed in terms of what feeds into your model?

Chad Beynon: Changed in terms of what feeds into your model. Thank you.

Charles Gillespie: Thank you. Morning, Chad. Our strategy in Brazil has been very much wait and see. And frankly, still is, you know, we have not done any M&A there, we have not made any big organic push there ourselves, and we've never had meaningful revenue from Brazil. All of our peers that had meaningful revenue from Brazil have been Digesting some extremely challenging costs as the market has regulated, taxes have gone up, etc, etc. We've reviewed it plenty of times, and the math is challenging. It is competitive. There's lots of operators, sensible taxes, but at the same time, there's local regulations about how you have to run your business with a local entity, and then there's challenges on getting money out of Brazil, which...

Chad Beynon: Good morning, Chad.

Chad Beynon: And Brazil has been a very much wait and see and frankly still is we have not done any M&A. There we have not made any big organic push there ourselves and we've never had meaningful revenue from Brazil, all of our peers that had meaningful revenue from Brazil have been.

Chad Beynon: Digesting some extremely challenging comps as the market has regulated taxes have gone up et cetera et cetera.

Chad Beynon: Sure.

Chad Beynon: You know, we we we've reviewed it plenty of times and the math is challenging it is competitive there's lots of operators sensible taxes, but at the same time, there's local regulations about how you have to run your business with a local entity and then there's challenges on getting money out of Brazil.

Chad Beynon: Which.

Chad Beynon: Make it less attractive.

Charles Gillespie: Make it Less Attractive. We are continuing to take calls on M&A opportunities in Brazil. We remain interested. We'd like to have the right Brazilian business, but we are going to be as picky and cautious. probably going to be even pickier and even more cautious than we are in any other given market, given the operating challenges we've seen from our peers in that market.

Chad Beynon: We are continuing to take calls on M&A opportunities in Brazil.

Chad Beynon: We remain.

Chad Beynon: Interested we'd like to have the right Brazilian business, but we are going to be as picky and cautious.

Chad Beynon: Probably going to be even pickier and even more cautious than we are in any other given market given the operating challenges we've seen from.

Chad Beynon: <unk> from our peers in that market.

Speaker Change: Great. Thanks Charles.

Chad Beynon: Great, thanks Charles.

Chad Beynon: And then another question just kind of going back to some of the noise that we saw in the first quarter, I guess this one would be related to potential tax increases. I know we're still seeing in the trade rags that New Jersey is still contemplating this, but when the noise is heightened with a lot of your partners in the U.S. with respect to potential tax increases, I know most of them haven't happened, but there's just been a lot of headlines. What happens with the conversations with you and your partners? Are they trying to pull back?

Speaker Change: And then another question just kind of going back to.

Speaker Change: Some of the noise that we saw in the first quarter I guess this one would be related to potential tax increases I know, we're still seeing in the in the.

Speaker Change: And the trade rags that new Jersey is still contemplating this.

Speaker Change: When the noises heightened with a lot of your partners in the U S with respect to potential tax increases I know most of them haven't happened.

Speaker Change: But there's just been a lot of headlines.

Speaker Change: What happens with the conversations with with you and your partner are they trying to pull back or are they more hesitant.

Charles Gillespie: Are they more hesitant? I'm sure it's maybe even a time to lean in, but just trying to get a sense if we do see some tax increases in the U.S., what happens with your partner's goals to grow NDCs through affiliates.

Speaker Change: You know I'm sure, it's maybe even a time to lean in.

Speaker Change: But just trying to get a sense, if we do see some tax increases in the U S. What happens with your partners Gulf to grow a N D. C is through affiliates. Thanks.

Charles Gillespie: Thanks. Yeah, to the extent that states raise gaming tax rates, it does, of course, negatively impact player lifetime value, but over time, not immediately. You know, that, at the end of the day, that's the pool of value that we're all working off of. So if that pool gets smaller, there's less to go around, but in our experience, it takes It can take a year for that to play out and it doesn't get fully passed on to us. So it's not a positive development, but it's not particularly challenging either. The rates, the deals, they just adjust and everyone presses forward.

Speaker Change: Yeah.

Speaker Change: To the extent that states raise gaming tax rates. It does of course negatively impacts planer lifetime value, but over time not immediately.

Speaker Change: You know that at the end of the day, that's the pool of value that we're all working off of so if that pool will get smaller there's less to go around but in our experience. It takes.

Speaker Change: I can take a year for that to kind of play out and it doesn't get fully passed on to us.

Speaker Change: So it's.

Speaker Change: It's not a positive development, but it's not it's not particularly challenging either.

Speaker Change: The rates the deals they just adjust and everyone presses forward.

Speaker Change: These.

Chad Beynon: you know again With these prediction markets probably about to experience hyper growth, and I think that has the chance to keep these state gaming regulators honest and make them think twice about raising tax Thank you very much.

Speaker Change: Again.

Speaker Change: With these prediction markets probably.

Speaker Change: About to experience hyper growth.

Speaker Change: I think that.

Speaker Change: Has the chance to keep these stay gaming regulators honest in and make them think twice about raising taxes.

Speaker Change: Thank you very much.

Speaker Change: Our next question comes from Mike Hickey with the Benchmark Company. Please proceed with your question.

Michael Hickey: Our next question comes from Mike Hickey with The Benchmark Company. Please proceed with your question. Thank you. H.R. I'll do this. Pete. Nice corner, guys.

Speaker Change: Okay. Thank you Hey, Charles Me laugh.

Speaker Change: Good morning.

Speaker Change: Thanks.

Speaker Change: <unk>.

Speaker Change: On our near term guidance outside of FX contribution or not just curious how you guys are thinking about.

Michael Hickey: I don't have any near-term guidance outside of FX contribution or not, just curious how you guys are thinking about... potential upside scenarios here, especially we've got Missouri, which is in your guidance. I think we're still planning for Alberta. early 26. So I'm guessing from your business standpoint that that would be in 25. So it just feels like your business is strong here, maybe better than you're expected in one queue, and then you've got sort of upside. baked into your numbers here.

Speaker Change: Potential upside scenarios here, especially even got Missouri, which is in your guidance I think we're still planning for Alberta.

Speaker Change: In early 'twenty six so I'm guessing from your business standpoint that would be in 25. So it just feels like here.

Speaker Change: Your business is strong here or maybe better than you expected in <unk> and then you've got sort of upside.

Speaker Change: Baked into your numbers here I'm, just curious if we're thinking about that right.

Michael Hickey: Just curious for thinking about that.

Speaker Change: Yeah. So one of our big projects. This year is the.

Charles Gillespie: Yeah, so one of our big projects this year is the rather substantial revamp of the consumer side of Rotowire. The internal code name is Project Purple Rain, and that's going live at some point this summer. So it's not just a refresh of the brand, it's a fairly substantial refresh of the fundamental product. The data underlying that business is tremendous, and that data will continue to be the centerpiece of the product suite. But that is a big focus of our team at the moment, and that has the potential to outperform.

Speaker Change:

Speaker Change: As they say.

Speaker Change: Rather substantial revamp of the consumer side of <unk> the <unk>.

Speaker Change: Internal Codename as project Purple rain.

Speaker Change: And that's going live at some point this summer.

Speaker Change: So it's not just a refresh of the brand it's a it's a fairly substantial degree.

Speaker Change: Refresh of the fundamental products you know the data underlying that business is tremendous and and that data will continue to be the center piece of the product suite.

Speaker Change: But that is that is a big focus of our team at the moment and.

Speaker Change: That has the potential to.

Speaker Change: Outperformed.

Speaker Change: Nice thanks, Charles loved the fence reference as well.

Michael Hickey: Thanks, Charles. Love the trends reference as well.

Michael Hickey: On the prediction market opportunity, it sounds like you're very enthusiastic.

Speaker Change: On the prediction market opportunity it sounds like you're very enthusiastic I mean, what do you think Charles from your view.

Charles Gillespie: Operators need to be more confident that we in fact have a very durable regulatory framework here so that they can invest money. on the marketing side. And then this just seems like on the surface like a massive opportunity for you guys just thinking about sort of many states kind of legalizing here at once. So I'm curious if you could just sort of frame that for us the best you can. And then do you feel like your sort of position today here, if it's sort of, we get the framework we need, I guess it's already there, but there's more belief that it's sustainable.

Speaker Change: Operators need to be more confident.

Speaker Change: We in fact have regulatory framework here are so that they can best monies.

Speaker Change: On the marketing side and then.

Speaker Change: Just seems like on the surface like a massive opportunity for you guys just thinking about sort of many states kind of legalizing here.

Speaker Change: Once so curious if you can just sort of frame that for us. The best you can and then do you feel like your sort of position today here.

Speaker Change: Is it sort of we'd get the framework, we need I guess, it's already there, but theres more beliefs that are sustainable.

Charles Gillespie: Like you positioned to sort of benefit immediately, Charles, do you feel like you have to make some acquisitions or deals or sort of how would you sort of position the framework of your company to benefit from the prediction market? Thanks. So, there's been a couple of different court decisions, call she keeps winning, you know, the prediction markets companies keep winning, so that's providing incremental clarity that this is okay. But the big fundamental question here is, do the states have authority to override the federal government on this? You know, can they, you know, the federal government's got a, you know, fully Fully-fledged regulatory framework for this, which it has had for decades, right?

Speaker Change: <unk> positioned to sort of benefit immediately Charles do you feel like you have to make some acquisitions or deals or sort of how would you sort of position.

Speaker Change: The framework of your company to benefit from the protection market. Thanks, guys.

Speaker Change: Yeah.

Speaker Change: So there's been a couple of different court decisions call she keeps winning.

Speaker Change: Prediction markets companies keep winning so that's providing incremental clarity that this is okay, but the big fundamental question here is do the states have authority to override the federal government on this.

Speaker Change: Can they you know the federal government has got a.

Speaker Change: Fully.

Speaker Change: Fully full fledged fully fledged our regulatory.

Speaker Change: The regulatory framework for this which has had for decades right now of course, it's being kind of expanded into.

Charles Gillespie: Now, of course, it's being kind of expanded into newer categories. But this has been there for a long time. It's never really been challenged. But now that it's overlapping, you could argue somewhat with these state gaming regulators, although it is a very different product. Can the state gaming regulators kind of say, look, uh... You can't do this. Stop it. Tax it. Do they have a say in this? And that's the big question at the moment. Given the kind of form in terms of court victories, it seems unlikely that they do, but this could be the next passbook, right?

Speaker Change: Newer categories, but this has been there for a long time, it's never really been challenged and you know, but now that it's overlapping you could argue somewhat with these state gaming regulators, although it is a very different product.

Speaker Change: Kansas City gaming regulators kind of say look.

Speaker Change: Can't do this stop it tax it do they have a say in this and that's the big question at the moment.

Speaker Change: Given the kind of form in terms of court victories.

Speaker Change: It seems unlikely that they do.

Speaker Change: But this could be the next Pascal right. This one could grind on and go to the Supreme Court. So I don't I don't think any of us are going to have perfect clarity anytime soon unfortunately, but.

Charles Gillespie: This one could grind on and go to the Supreme Court. So I don't think any of us are going to have perfect clarity anytime soon, unfortunately, but that's life. Ultimately... There's no fixed number of skins. Anybody can go and, assuming they're fit for purpose, apply and theoretically get regulated to do this if they have the right control framework and everything else. So, you could have quite a few entrants coming into this category. Obviously, it's more than just Kalshi that's excited about this, although they do seem to be in the lead.

Speaker Change: That's the life.

Speaker Change: Ultimately.

Speaker Change: There's no.

Speaker Change: There's no fixed number of skins right you know anybody can go in and you know assuming they're fit for purpose supply and theoretically get regulated to do this if they have the right control framework and everything else. So.

Speaker Change: You could have quite a few entrants coming into this category. Obviously, it's more than just coffee that is excited about this although they do seem to be in the lead.

Charles Gillespie: And from our perspective, there's not really anything to buy. It's a brand-new category, and this is also our bread and butter. We produce content about interesting gambling or gambling related products, and it's quite straightforward for us to just kind of expand our coverage to cover this new category. So, I don't see any meaningful OPEX or M&A required to tackle it, and we'll do our best from our seat here to help everybody out. We have relationships, commercial relationships, with a lot of these companies already. We have revenue from this category. It's small, but it potentially could be very substantial over the coming years.

Speaker Change: And from our perspective, there's not really anything to buy it's a brand new category and if this is also our bread and butter.

Speaker Change: Produce content about interesting gambling or gambling related.

Speaker Change: Products and.

Speaker Change: It's quite straightforward for us to just kind of expand our coverage to cover this new category. So I don't see any meaningful opex or M&A required to tackle it.

Speaker Change: And we'll do our best from our seat here to help everybody out we have met we have relationships commercial relationships with a lot of these companies already you know we have revenue from this category its small but its.

Speaker Change: You know potentially could be.

Speaker Change: Substantial over the coming years I think it's speculative.

Charles Gillespie: I think it's not going to explode next quarter, but when you think about the next couple of years, this could be a very meaningful feature of the U.S. marketplace.

Speaker Change: <unk> next quarter, but it's when you when you think about the next couple of years this could be.

Speaker Change: A very meaningful feature of the U S marketplace.

Speaker Change: Thanks, guys. Good luck.

Speaker Change: We have reached the end of our question and answer session, which concludes today's teleconference. You may disconnect. Your lines at this time. Thank you for your participation.

Operator: We have reached the end of our question and answer session, which concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

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