Sports software provider Kambi has posted massive Q3 gains, after seeing success penetrating the regulated sports betting market in NJ and PA.
After the U.S. Supreme Court overturned PASPA back in May, the beginning of a new “legal gambling era” was started throughout the United States – and operators were racing to figure out a way to enter this estimated $5 billion market (and that’s just over the next 5 years!)
One of the major issues US-based operators have faced, however, is that they simply don’t have the technological capabilities to offer US-based punters the state-of-the-art online gambling experiences found in other parts of the world, and for this reason, many have chosen to partner up with operators who are already established in the online gambling world.
For most U.S. based operators, this means that – instead of building their online products and software solutions – they will, instead, offer third-party platforms, allowing punters to enjoy a seamless and reliable sports betting experience online.
One of the companies who are already established outside of the United States is Kambi – a sports betting-focused software supplier that has established itself as a leading figure in the online betting world, particularly in Europe.
Kambi’s recent US success can largely be attributed its penetration into regulated markets within New Jersey and Pennsylvania – something which has shown itself to be a positive move for the company in their 2018 Q3 earnings report. Within this report, Kambi showed that it enjoyed a significant uptick within a number of their key performance indicators.
Some of the most notable takeaways from their Q3 report showed:
- Kambi’s revenue grew by 39% year-on-year, with January to September 2018 earnings totaling €54.5 million
- Kambi’s profits (after tax) was €3.3 million during Q3, and €6.5 million from January to September 2018
- The operator’s turnover reached its highest ever, increasing by more than 30%
- Kambi managed to sign three new European-based clients, and continues to expand aggressively within the US, partnering up with operators wanting to launch online services
Speaking inside the report, Kambi’s CEO Kristian Nylen said: “This time last year I described Q3 2017 as a ‘springboard’ quarter for Kambi, and what’s followed has been a period of sustained growth, leading to what can only be regarded as an historic Q3 2018 for the company.”
Indeed, Kambi has already made significant headway in the US markets (particularly in New Jersey), and the software suppliers already powers three US online sportsbooks.
The first, is DraftKings, which was launched on the 8th June, 2018. The second is Play SugarHouse Sports, which was launched on the 23rd August, 2018, and the third is 888sport NJ, which was launched on the 9th October, 2018. As you can see, Kambi have been quick to enter the market, signing 3 (likely) highly-profitable deals in the few months following the SCOTUS decision.
The company also made the news when it partnered with DraftKings, as DraftKings had never had any experience in taking real-money sports wagers from punters – and, after partnering with Kambi, the bookmaker managed to launch their online sportsbook product before many of their larger competitors, giving the operator a substantial hold of the market.
In fact, in partnering with DraftKings, Kambi “created history by becoming the first company to process a legal online bet in the country outside of Nevada,” said Nylen.
This partnership has clearly proved to be a lucrative one – but it’s evident that the market has only just begun to open up, and we’re likely to see an increasing shift in companies partnering with third-party software suppliers.
It remains to be seen as to how Kambi will continue its expansion efforts – but given the success the company has already enjoyed, it’s obvious that they know what they’re doing, and we’re likely to see more and more US-based operators attempt to partner up with the company, given their impressive track record and clear knowledge of the market.