In the third quarter of the year, iGaming affiliate giant Raketech reported financial results that reveal a solid performance despite a drop in revenue. The company’s revenue from continued operations fell to EUR 6.2 million ($7.2 million), down from EUR 10.7 million the previous year. However, Raketech’s adjusted EBITDA from continuing operations and reported EBITDA held steady at EUR 1.2 million ($1.4 million) and EUR 1.1 million ($1.3 million) respectively, reflecting the company’s underlying stability.
Raketech attributed this sustained EBITDA performance to the continued strength of its Affiliation Marketing segment, which remains a cornerstone of its business model. The Affiliation Marketing portfolio showed resilience and continued to contribute significantly to Raketech’s overall results. Meanwhile, the subaffiliation revenue held firm at EUR 1.9 million ($2.2 million), consistent with the previous quarter’s figures.
A notable achievement came from Raketech’s Organic Publisher Network, which generated EUR 0.9 million ($1 million), marking a substantial increase from the prior quarter. However, the company faced challenges in its Paid Publisher Network, which experienced a downturn in line with broader market conditions.
Raketech’s cash flow for Q3 stood at EUR 1.1 million ($1.3 million), with the company noting the impact of certain tax payments on this metric. The focus on streamlining efforts has been pivotal in maintaining a robust cost structure while ensuring operational flexibility.
During the third quarter, Raketech expanded its partnership with a US-based sports betting and casino publisher through its Organic Publisher Network and AffiliationCloud. This strategic partnership involved a $750,000 minority investment and has already begun to drive growth for Raketech, reinforcing its strategic pivot towards a platform-first approach.
In line with its streamlining strategy, Raketech divested its Casumba assets for a total of EUR 12 million ($13.9 million). This transaction, albeit resulting in a non-cash loss of approximately EUR 10 million ($11.6 million), will not impact the company’s cash flow or core operational performance, according to Raketech’s assessment.
Reflecting on the quarter’s performance, Raketech’s CEO Johan Svensson described the period as “another step forward” in the company’s platform-first strategy execution. Svensson emphasized Raketech’s commitment to maintaining a clear focus and set priorities, positioning the company to leverage its cleaner structure and strengthened partnerships for future growth.
“As we move into the final quarter of the year, with a sharper focus and enhanced flexibility, Raketech stands ready to deliver on our platform-first strategy,” Svensson noted, underscoring the company’s ambition to fortify its market position.
Raketech’s goals remain centered on enhancing the AffiliationCloud platform, maintaining disciplined capital allocation, and creating value for partners, shareholders, and employees. Svensson’s vision reflects a broader industry trend where companies streamline operations to better adapt to evolving market dynamics.
Despite the challenges, industry analysts have been cautiously optimistic about Raketech’s ability to navigate the current landscape. Some observers note that while revenue pressures are evident, the company’s efforts to optimize its business model could bear fruit in the longer term. The strategic divestments and focused investments are seen as moves that could potentially stabilize and enhance Raketech’s market footprint.
Conversely, critics argue that the decline in top-line revenue cannot be ignored, pointing to the need for revenue rejuvenation to sustain long-term growth prospects. They caution that in a highly competitive iGaming landscape, Raketech must continuously innovate and expand its portfolio to capture new opportunities and counteract market pressures.
Overall, Raketech’s Q3 results paint a picture of a company balancing strategic streamlining with the need to maintain operational stability. The company’s ability to sustain its EBITDA levels, despite revenue dips, highlights its adept handling of operational efficiencies and market strategy. As the fiscal year progresses, Raketech’s approach will likely be scrutinized for its effectiveness in achieving the desired growth and stability amidst industry headwinds.
