Gambling.com Group swung to a net loss of $1.2 million in the first quarter of 2026, reversing net income of $11.2 million in the same period last year, as regulatory headwinds in the UK and Finland compressed marketing revenue and costs rose across the business.
Revenue Flat, Profitability Sharply Lower
Revenue for the three months ended 31 March 2026 came in at $40.4 million, broadly unchanged from $40.6 million in Q1 2025. The headline stability masked a divergence between the company’s two segments. Sports data services revenue grew 13% year on year to $11.2 million, driven by enterprise sales through OpticOdds, with active partners up 24% quarter on quarter. Marketing services revenue fell 5% to $29.2 million, reflecting what management described as poor organic search dynamics and regulatory changes in the UK and Finland.
Gross profit dropped 11% year on year to $34.4 million. Cost of sales increased 171% to $6.1 million, primarily reflecting expenditure on traffic diversification as the company moves to reduce its dependence on organic search. Total operating expenses, excluding non-cash amortisation of acquired intangibles of $2.6 million, OddsJam acquisition bonuses of $0.3 million, and other non-recurring items of $0.1 million, rose 12% to $28.2 million, driven by higher AI subscription costs and external marketing spend.
Adjusted EBITDA fell 43% to $9.0 million, from $15.9 million in Q1 2025. The adjusted EBITDA margin contracted to 22%, down from 39% a year earlier. The company delivered 140,000 new depositing customers in the quarter, compared with 138,000 in Q1 2025.
The result missed analyst expectations materially. Consensus had forecast earnings per share of $0.10 for the quarter. The company reported a loss of $0.03 per share. Shares fell approximately 28% in after-hours trading following the release.
UK and Finland Driving Marketing Decline
The marketing services decline reflects a pattern visible across the affiliate and media sector in regulated European markets. Great Britain online gambling revenue fell 2% to £1.5bn in Q4 2025, signalling softer underlying operator activity that flows through to affiliate performance. Finland’s regulatory tightening has added further pressure, reducing the addressable market for performance marketing services.
The UK tax environment has compounded the challenge. The UK confirmed major gambling tax increases in late 2025, raising the online casino rate to 40% and sports betting to 25%, increasing the pressure on operators and, by extension, on the affiliate businesses that depend on their marketing budgets. Gambling.com Group noted that some of the marketing revenue decline was partly offset by growth from traffic sources not reliant on organic search.
AI Restructuring and 25% Workforce Reduction
Alongside the results, Gambling.com Group announced a proposed restructuring tied to an AI-first operating model. The company expects the reorganisation to cut approximately 25% of its workforce, with annualised cost savings of $13 million net of increased AI usage costs.
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. This shift to AI-first working principles enables a proposed restructure of teams that is expected to drive substantial annualised cost savings.
— Kevin McCrystle, Incoming Chief Executive Officer and Co-Founder, Gambling.com Group
Chief Financial Officer Elias Mark said the restructuring is expected to drive margin expansion in the second half of the year and beyond. The company expects to realise approximately half of the $13 million in annualised savings in H2 2026, with the full amount flowing through from 2027.
Cash and cash equivalents stood at $8.4 million at 31 March 2026, down from $15.8 million at year-end, as the company paid deferred acquisition consideration and transaction bonuses related to the OddsJam deal. Borrowings under the Wells Fargo credit facility were $116.5 million. Total assets were $290.7 million and equity was $107.1 million.
Guidance Cut Below Analyst Consensus
Management revised full-year 2026 guidance to revenue of $165 million to $170 million and adjusted EBITDA of $45 million to $50 million. Both ranges sit below the analyst consensus of approximately $175.5 million in revenue ahead of the results. The updated guidance assumes continued headwinds from organic search dynamics and European regulatory changes, alongside ongoing investment in traffic diversification and new product development.
The sports data services segment is positioned as the growth driver. OpticOdds enterprise revenue grew 13% year on year in Q1, and management expects the segment to expand into the high teens on a full-year basis, with recurring subscription revenue as the primary engine. Marketing services guidance assumes low-teens growth for the full year once traffic diversification and AI integration benefits begin to flow through.
The guidance cut and earnings miss place the company under meaningful investor scrutiny heading into Q2. Whether the AI-driven restructuring delivers the cost savings on the timeline management has outlined, and whether marketing revenue stabilises as organic search dynamics improve, will determine the pace of any recovery in profitability metrics through the second half of the year.
Source: Gambling.com Group
