GAN acclaims B2B growth during Q3 2022 as revenue jumps 14%

GAN has welcomed a 14% year-on-year (YoY) increase in its revenue from its B2B division, which delivered $12.7m in revenue during Q3 2022.

Delivering its financial report for the period, the Nasdaq-listed supplier attributed the growth primarily to an increase in platform and content license fee revenue from new content, as well as organic growth within its US real-money internet gaming (RMiG) business.

However, the growth in B2B revenue was offset by a $1.7m decrease in revenue within the B2C segment, chiefly due to unfavorable foreign currency fluctuations.

Within the B2B segment, B2B gross operator revenue increased by 29% YOY to $277.8m in Q3, attributed in part to launches in new jurisdictions as well as the launch of its RMiG solutions for new customers in existing jurisdictions including Michigan.

GAN’s B2C segment revenue fell 8% YOY to $19.4m from a prior high of $21.1m, which was also impacted by currency fluctuations and a lower sports margin, albeit to a lesser extent.

Its B2C active customers numbers rose by 31% due to growth in the Latin American market, as well as strong customer retention.

At a wider group level, GAN’s total revenue remained relatively flat when compared to the prior-year period, amounting to $32.1m in Q3 2022.

As a result of the growth in its B2B division, GAN’s gross profits rose to $22.7m in Q3, with its operational expenses decreasing by $2.7m, attributed in part by the firm’s cost saving initiatives as well as favorable foreign currency fluctuations.

GAN’s net losses dropped from $8.7m to $6.9m in Q3 2022, primarily driven by an improved gross profit margin and lower general and administrative expenses.

Its adjusted EBITDA benefited from the smaller net loss, with the metric rising from a negative figure of $0.9m to a positive figure of $2.1m, with GAN’s available cash amounting to $41.8m in the Q3 period.

Addressing the strong growth in B2B and cost rationalization measures, GAN CEO Dermot Smurfit lauded the group’s technology and managed trading services in the US.

“We are looking forward to what we expect to be a strong launch cadence of GAN Sports, the upcoming FIFA World Cup, as well as our entrance into the Mexico market,” Smurfit said.

“At the same time, we are acutely focused on cost rationalization measures and productivity enhancements in order to better navigate a challenging current environment.”

He continued: “Our cost reduction efforts to date are already helping to yield improved margins and we expect to enact new cost-cutting measures while ensuring we smartly allocate capital to our highest ROI opportunities to fund our growth plan.

“We have always remained vigilant for opportunities to best position GAN for future success and to ensure we drive value creation for our shareholders,” Smurfit added.