Gambling.com Group cuts 2026 guidance and plans 25 per cent workforce cut
Gambling.com Group began 2026 reporting nearly flat first-quarter revenue, but saw profit, margins and cash generation decline sharply due to regulatory pressure in Europe, changes to search engine mechanisms and rising costs linked to traffic diversification and artificial intelligence. At the same time, the group announced one of its largest operational changes in recent years: an AI-driven internal restructuring expected to reduce approximately 25 per cent of its workforce and generate $13 million in annual savings.
The Nasdaq-listed company released its results on Thursday (14). The group provides marketing and technology services for the online betting and fantasy sports market, operating brands including Gambling.com, Bookies.com, Casinos.com, OddsJam, OpticOdds and RotoWire.
The quarter’s results showed a sharp contrast between the company’s two operational pillars. While sports data services continued growing at a fast pace, the traditional marketing segment faced pressure in key markets such as the UK and Finland.
Total Gambling.com Group revenue reached $40.4 million in the quarter ended 31 March 2026, remaining virtually unchanged from the $40.6 million reported in the same period last year. On a constant currency basis, however, revenue declined 11 per cent.
Despite stable revenue, profitability indicators fell significantly. The company reported a net loss attributable to shareholders of $1.2 million, reversing the $11.2 million profit recorded in Q1 2025. Diluted earnings per share moved from a profit of $0.31 to a loss of $0.03.
Net margin declined from 28 per cent to a negative 3 per cent. Adjusted EBITDA fell 43 per cent, dropping from $15.9 million to $9 million, while adjusted EBITDA margin declined from 39 per cent to 22 per cent. On a constant currency basis, adjusted EBITDA decreased 49 per cent.
Operating cash flow dropped 89 per cent, falling from $8.1 million to just $914,000. Adjusted free cash flow declined from $10.3 million to $3.9 million, a decrease of 62 per cent.
According to the company, part of the operational deterioration was caused by extraordinary payments linked to previous acquisitions, bonuses related to the OddsJam acquisition and increased investments in traffic diversification.
Sports data continues growing while marketing slows
The sports data division was the company’s main growth driver during the quarter. Revenue from the unit increased 13 per cent year-on-year to $11.2 million, primarily driven by expansion in OpticOdds corporate sales.
Meanwhile, revenue from the marketing segment declined 5 per cent to $29.2 million. The company attributed the weaker performance to the effects of organic search engine changes and new regulatory pressures in European markets.
Despite the slowdown, Gambling.com Group reported acquiring 140,000 new depositing customers during the quarter, slightly above the 138,000 recorded in Q1 2025.
The figures also showed a gradual shift in the business mix. The data division represented 28 per cent of total company revenue, up from 24 per cent a year earlier. Marketing declined from 76 per cent to 72 per cent of consolidated revenue.
By monetisation segment, performance marketing generated $25.5 million, virtually unchanged from the $25.7 million recorded a year earlier. Subscription revenue increased to $11.2 million, while advertising and other revenue fell 25 per cent, ending the quarter at $3.7 million.
The company detailed that marketing revenue includes CPA agreements, revenue share, hybrid models and ticketing services for recreational events. Data revenue comes from corporate and consumer subscriptions related to analytics, syndication and sports data services.
North America grows while Europe loses ground
The results showed a significant geographical reshaping of the group’s operations. North America further increased its importance and accounted for 66 per cent of total company revenue. Revenue in the region grew 26 per cent, reaching $26.5 million compared with $21 million in Q1 2025.
Meanwhile, the UK and Ireland recorded a contraction. Revenue declined 30 per cent from $11.1 million to $7.8 million. The rest of Europe fell 27 per cent to $4.3 million. The rest of the world declined 32 per cent, ending the quarter at $1.8 million.
The company itself identified the UK as one of the main pressure points on the business. According to the company, the higher-than-expected increase in gaming duty in the country is reducing player spending and player volume. In Finland, Gambling.com stated that new regulatory rules have directly affected affiliate marketing performance.
Casino revenue declines as sports gains share
By product segment, casino-related revenue declined 12 per cent, ending the quarter at $21.6 million. In the same period of 2025, the segment had generated $24.6 million.
Meanwhile, the sports vertical grew 8 per cent, reaching $16.6 million compared with $15.4 million a year earlier. The “other” category recorded the highest percentage growth of the quarter. Revenue increased from $675,000 to $2.3 million, up 234 per cent.
The figures reflect the company’s attempt to reduce its historical dependence on organic traffic linked to online casinos and increase exposure to sports data and subscription products.
Costs increase with AI and traffic diversification
Despite stable revenue, costs increased significantly during the quarter. Cost of sales rose 171 per cent year-on-year, increasing from $2.2 million to $6.1 million. On a constant currency basis, the increase was 142 per cent. According to the company, the rise mainly reflects costs associated with the traffic diversification strategy within the marketing segment. Gross profit fell 11 per cent, ending the quarter at $34.4 million. On a constant currency basis, the decline was 20 per cent.
Sales and marketing expenses increased 7 per cent to $16.2 million. Technology expenses rose 28 per cent to $6.7 million, while general and administrative expenses increased 6 per cent to $8.2 million. The company stated that the increase in expenses was mainly driven by higher subscription costs related to AI usage and increased external marketing spending linked to the traffic diversification strategy.
Total operating expenses, including amortisation, bonuses related to the OddsJam acquisition and other non-recurring costs, reached $31.1 million compared with $28.4 million a year earlier. Excluding these items, expenses increased 12 per cent to $28.2 million.
AI-based restructuring plans 25 per cent workforce reduction
In the report, Gambling.com Group also announced a structural transformation focused on artificial intelligence. Interim CEO and co-founder Kevin McCrystle said the company is adopting AI as the “foundational layer” of how the organisation operates. According to him, this will accelerate product and marketing innovation using smaller and more flexible teams.
The company said the new structure is expected to reduce approximately 25 per cent of the workforce and generate $13 million in annualised savings. Around half of this amount is expected to begin appearing in the second half of 2026. “We continue to integrate AI into our workflows and are moving quickly to adopt AI as the foundational layer of how the entire organization operates,” he said.
CFO Elias Mark stated that the company will continue generating sufficient cash flow to reduce leverage and keep investing in new products.
2026 guidance lowered
The company revised its projections for the year and now expects revenue between $165 million and $170 million in 2026, alongside adjusted EBITDA between $45 million and $50 million. The guidance considers:
- growth driven by sports data services;
- continued expansion of recurring subscription revenue;
- persistence of challenges linked to organic traffic;
- regulatory impacts in the UK and Finland;
- investments in marketing diversification;
- new investments in sports data products;
- launch of a new product later in 2026;
- significant margin expansion in the second half;
- average euro/dollar exchange rate of 1.17 throughout the year.
Cash position declines and debt remains elevated
The balance sheet shows that Gambling.com Group ended March with $8.4 million in cash and equivalents, below the $15.8 million recorded at the end of 2025. Trade receivables increased to $28.4 million compared with $26.5 million at the end of the previous year. Intangible assets remained high at $241.4 million. Shareholders’ equity stood at $107.1 million at the end of the quarter.
On the liabilities side, the company held $106.4 million in long-term borrowings and an additional $10.1 million in short-term debt and accrued interest. Debt related to the Wells Fargo credit facility totalled $121.3 million at the end of the quarter. During the period, the company repaid $2.8 million of the loan.
Cash flow reflects OddsJam-related payments
Operating cash flow was affected by a series of payments related to the OddsJam acquisition. The company paid $2.4 million in transaction-related bonuses and recorded $2.2 million in deferred payments related to business combinations. Development investments also increased.
Capitalised development costs rose from $827,000 to $1.3 million. Financing cash flow was negative at $5.1 million following debt repayments, interest payments and lease obligations. The company did not repurchase shares during the quarter, but stated that it still has $14.4 million available under the current share repurchase authorisation.
Despite weaker results at the start of the year, Gambling.com Group said the combination of expansion in sports data services, greater diversification of its marketing business, and AI-driven cost reductions should support a return to growth and higher margins in the second half of 2026.
This article was first published in Portuguese on 20 May 2026.
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