Gambling.com Group Ltd (NASDAQ:GAMB) Reports Record Q2 2025 Revenue and EPS Beat Amid Market Selloff

Gambling.com Group Ltd (NASDAQ:GAMB) reported its second-quarter 2025 financial results, delivering record revenue and adjusted EBITDA but facing a sharp market reaction despite beating earnings expectations. The company posted revenue of $39.6 million, up 30% year-over-year, slightly below analyst estimates of $39.7 million. Adjusted earnings per share (EPS) came in at $0.37, significantly above the consensus estimate of $0.16.

Key Financial Highlights

• Revenue: $39.6 million (+30% YoY), narrowly missing estimates by ~$0.4 million.
• Adjusted EPS: $0.37, beating expectations by 138%.
• Adjusted EBITDA: $13.7 million (+22% YoY), with a margin of 35%.
• Free Cash Flow: $8.2 million (+36% YoY).

Despite the earnings beat, shares fell sharply in after-hours trading, dropping nearly 11%. This reaction suggests investor concerns beyond the headline numbers, possibly tied to rising costs, acquisition-related expenses, or broader market sentiment.

Business Performance & Strategic Moves

The company highlighted diversification efforts, with sports data services now contributing 25% of total revenue—up from minimal levels a year ago—driven by acquisitions like OddsJam and OpticOdds. Marketing revenue grew modestly at 3%, while the company continues shifting toward an omnichannel approach.

Gambling.com also announced the acquisition of Spotlight.Vegas, a Las Vegas-based booking platform, for up to $30 million. The deal is expected to be accretive in 2026, adding at least $8 million in net revenue and $1.4 million in adjusted EBITDA.

Outlook vs. Analyst Expectations

Management raised full-year 2025 guidance, projecting:

• Revenue: $171–$175 million (vs. analyst consensus of $175.6 million).
• Adjusted EBITDA: $62–$64 million (no direct consensus available, but implies ~29% YoY growth).

The revenue outlook remains slightly below Wall Street expectations, which may explain the negative market reaction despite the strong EPS beat. Additionally, higher sales and marketing costs (+44% YoY) and technology expenses (+98% YoY) weighed on profitability.

Market Reaction & Investor Sentiment

The post-earnings selloff suggests investors may be focusing on:

1. Margin Pressure: Adjusted EBITDA margin declined to 35% from 37% a year ago.
2. Acquisition Risks: While Spotlight.Vegas adds diversification, integration risks and upfront costs could be a concern.
3. Revenue Growth Deceleration: Q2 revenue growth slowed from 34% in H1 2025, possibly signaling tougher comparables ahead.

Conclusion

Gambling.com’s Q2 results showcased strong earnings growth and strategic expansion, but the market’s reaction highlights lingering concerns over margins and execution risks. The company’s ability to sustain high-margin recurring revenue from its sports data segment will be critical moving forward.

For more detailed earnings estimates and historical performance, visit Gambling.com Group’s earnings page.

Disclaimer: This article is for informational purposes only and does not constitute investment advice.