Gambling.com Group (GAMB) Q3 2025: Sports Data Services Jump 300%, Reshaping Revenue Mix
Gambling.com Group’s Q3 marked a pivotal shift as sports data services surged to 25% of revenue, offsetting SEO-driven stagnation in the marketing segment. Execution in enterprise data and traffic source diversification are driving a more resilient, multi-pronged business model, with management signaling confidence in a return to marketing growth for 2026. Forward guidance reflects persistent search headwinds, but underlying structural changes position GAMB to capitalize on both B2B and B2C tailwinds in the evolving betting ecosystem.
Summary
- Sports Data Services Expansion: Enterprise and B2C data offerings are now a core growth engine.
- Marketing Diversification Milestone: Non-SEO channels will surpass SEO for the first time in Q4.
- 2026 Growth Drivers: Organic data growth and marketing rebound set the stage for margin stability.
Performance Analysis
Gambling.com Group delivered record Q3 revenue and adjusted EBITDA, fueled by a triple-digit surge in sports data services that now account for a quarter of total revenue. The marketing business, which historically dominated the company’s topline, was flat year-over-year due to persistent unfavorable Google search dynamics, particularly outside the US. This SEO headwind led to a 13% decline in new depositing customers (NDCs) and a gross margin contraction to 91.2% from 94.7%, as the company invested in traffic diversification and absorbed costs from recent acquisitions.
Enterprise-facing OpticOdds, the flagship data solution, doubled revenue and expanded its product suite to include bet settlement and dynamic pricing tools, underpinning robust recurring revenue (49% of total). B2C data offerings, including Rotowire and OddsGen, saw modest growth as product refreshes prioritized long-term customer value over near-term revenue spikes. Operating expenses rose 30%, primarily from integration of acquired teams and higher marketing spend, while adjusted EBITDA margin compressed to 33% from 39% as growth investments outpaced operating leverage. Free cash flow conversion remained strong at 74% of adjusted EBITDA, though down year-over-year due to timing effects and elevated spend on buybacks and acquisitions.
- Sports Data Services Scale: Segment quadrupled to $9.2M, now 25% of revenue, and is expected to drive organic growth through 2026.
- Marketing Business Under Pressure: Flat revenue and lower NDCs reflect ongoing SEO algorithm volatility, but non-SEO channels are gaining share.
- Cash Flow and Capital Allocation: Strong free cash flow funds buybacks and M&A, though leverage and future earnouts constrain incremental investment.
Despite external search headwinds, GAMB’s evolving revenue mix and recurring base position it for structurally higher resilience and future margin improvement as non-SEO channels scale.
Executive Commentary
"Through a combination of acquisitions and great execution, we have created a fast-growing sports data services business out of nothing, which delights both enterprise and consumer clients and is already responsible for 25% of our 2025 revenue. The tight product market fit we have gives us confidence that there is a straightforward path for sustainable and highly predictable growth for this business."
Charles Gillespie, Co-founder and Chief Executive Officer
"Gross profit increased 17% to $35.6 million. Cost of sales of $3.4 million, comparison cost of sales of $1.7 million in the year-ago period, reflecting costs associated with the acceleration of our traffic sources diversification strategy for the marketing business and cost of sales from the acquired OTSGEM and Optic OTS businesses."
Elias Mark, Chief Financial Officer
Strategic Positioning
1. Sports Data Services as Growth Core
GAMB’s sports data services, led by OpticOdds, have rapidly become the company’s primary growth driver, benefiting from both enterprise adoption and B2C product innovation. The segment’s recurring revenue model and expanding product suite (e.g., bet settlement, dynamic pricing, open odds marketplace) create a multi-year runway for predictable growth. Management sees further upside in managed trading services and risk management solutions, positioning GAMB as a disruptor to legacy providers constrained by outdated technology.
2. Marketing Business Diversification
The marketing segment is undergoing a structural pivot away from SEO dependency, with non-SEO channels (e.g., paid, partnerships, content) set to overtake SEO in Q4 for the first time as a public company. This shift is intended to boost resilience, reduce volatility from algorithm updates, and improve contribution margins as non-SEO channels scale. A new marketing line is slated for launch in Q1 2026, further diversifying revenue streams.
3. Capital Allocation and Balance Sheet Strategy
Management is actively deploying free cash flow into buybacks and targeted acquisitions, but remains cautious on leverage given future earnout obligations for recent deals and current share price constraints. The company retains $70.5M in undrawn credit and is prioritizing capital efficiency, with M&A reserved for highly accretive, conviction-driven opportunities.
4. Product Innovation and Customer Stickiness
Continuous product development in both B2B and B2C data services is driving higher ARPU and subscriber growth, as seen with Rotowire’s 21% YoY subscriber increase and OddsGen’s new liquidity analytics features. These enhancements are designed to increase customer lifetime value and position GAMB as a must-have partner for market makers and operators navigating the evolving betting landscape.
Key Considerations
This quarter marks a strategic inflection as GAMB transitions from a pure-play affiliate to a diversified technology and data platform, with implications for growth, margin, and competitive positioning.
Key Considerations:
- SEO Recovery Uncertainty: Google’s pace in addressing spam remains a wild card for near-term marketing revenue, though recent improvements suggest a bottoming process.
- Recurring Revenue Base: Nearly half of total revenue is now recurring, supporting valuation resilience and long-term planning.
- Enterprise Data Penetration: OpticOdds’ rapid expansion and product-market fit highlight a scalable opportunity in both sports betting and emerging prediction markets.
- Margin Dynamics: Marketing diversification and data services scale are expected to stabilize margins in the mid-30s, despite short-term cost pressures from growth investments.
- M&A and Capital Flexibility: Balance sheet strength supports opportunistic M&A, but near-term focus is on organic execution and measured buybacks as share price remains depressed.
Risks
Persistent SEO volatility and reliance on Google’s algorithm adjustments create revenue unpredictability in the marketing segment, particularly outside the US. Rising operating costs from acquisitions and diversification could pressure margins if top-line acceleration falls short. Regulatory changes, such as increased UK gaming duties, may dampen operator spend and affiliate economics in key markets. Finally, future earnout obligations and leverage may constrain capital allocation flexibility if cash flow growth stalls.
Forward Outlook
For Q4 2025, Gambling.com Group guided to:
- Revenue of approximately $46 million, marking a record quarter
- Adjusted EBITDA margin of 33-34%, consistent with Q3 run-rate
For full-year 2025, management revised guidance to:
- Revenue of approximately $165 million
- Adjusted EBITDA of approximately $58 million
Management highlighted several factors that will shape the outlook:
- Sports data services expected to lead growth, with organic expansion in both enterprise and B2C channels
- Marketing business anticipated to return to growth in 2026 as non-SEO channels scale and SEO headwinds abate
Takeaways
GAMB’s Q3 demonstrates a successful pivot toward data-driven, recurring revenue streams, with sports data services now anchoring growth and marketing diversification reducing business risk.
- Segment Evolution: Sports data services and non-SEO marketing are reshaping the company’s revenue mix, supporting higher resilience and future margin improvement.
- Operational Leverage: Investments in product and channel diversification are compressing margins near-term but lay the foundation for scalable, high-ROIC growth as legacy SEO volatility recedes.
- Strategic Optionality: Robust cash flow and balance sheet flexibility enable continued buybacks, measured M&A, and organic investment, with management signaling confidence in a multi-year growth trajectory.
Conclusion
Gambling.com Group’s Q3 marks a clear transition to a multi-engine growth model, with sports data services offsetting marketing headwinds and non-SEO channels poised to drive future expansion. While SEO recovery remains a watchpoint, the company’s recurring revenue base and product innovation provide a solid foundation for 2026 and beyond.
Industry Read-Through
GAMB’s pivot toward enterprise data and recurring revenue mirrors a broader industry trend as affiliate and marketing-driven models face platform risk from search volatility and regulatory shifts. The rapid rise of prediction markets and demand for cost-efficient, flexible data services signal an opportunity for nimble upstarts to outmaneuver legacy providers saddled with technology debt. Operators and B2B suppliers across gaming and adjacent fintech sectors should monitor the migration toward open, API-driven data ecosystems and the growing importance of product innovation over sheer scale or historical relationships.