Gentoo Q2 results: Revenue down 19%, but ‘stable’ from here
Revenue was down 19%, though first-time deposits from paid media more than doubled.
Key points:
– Gentoo Media has released its Q2 financial results
– Revenue was down 19% year-on-year, while cash flow increased 24.2%
– CEO Jonas Warrer seemed unfazed about the potential of AI to impact searches
Gentoo Media has released its financial results for the second quarter of 2025.
In total, Q2 revenue came to €24.4m ($28.4m), down 19% year-on-year, with EBITDA before special items almost halving from €14.8m to €7.5m. Of the total revenue, 60% came from RevShare, while 14% came from CPA and 26% from listing fees and others. Recurring revenue share totalled €14.5m – the lowest recorded in the last five quarters.
Despite all these downturns, cash flow from operations increased 24.2% year-on-year, from €6.2m to €7.7m.
Marketing expenses came to €8.4m, up €1.5m quarter-on-year, driven by additional investments in markets such as Brazil.
The affiliate cited ‘deliberate operational recalibration’ as a reason for this overall downturn, alongside changes in Brazil and the lack of major sporting events. However, material cost reductions were able to improve EBITDA margins, reaching 40%+ in June.
Good to know: Gentoo Media completed its split from GiG in October 2024
Full-year guidance expects revenue to reach €100m – €105m, with EBITDA of €40m – €43m and free cash flow of €27m – €30m.
Jonas Warrer, CEO, spoke in a presentation following the release of the results. “IGaming affiliation is a key part of the value chain,” he said, noting the scalability, conversion and audience reach of the sector. He explained how Gentoo’s post-demerger from GiG Software, and post-Q1 stabilisation, was the cause for the quarter’s results, stating: “Revenue below expectation, but stabilised, with positive momentum in underlying business drivers.” Indeed, May and June caused challenges, but according to Warrer, “we need to adjust.”
However, despite revenue “not being where we want it to be,” Warrer remained positive, noting: “We [will] have a very different second half from the first half.”
In terms of first-time deposits, the total came to 1,362,000, up from 951,000 last quarter and 1,219,000 this time last year. Of this total, 525,000 came from Publishing (below the 532,000 reported last quarter), while Paid FTDs doubled quarter-on-quarter from 419,000 to 837,000. The slight dip in Publishing FTDs may in part be due to the impact of Google Core, which was initiated at the end of June, though Warrer believes this update will eventually lead to an uptick in player intake.
Indeed, the affiliate’s publication network now sits at 70 sites, including WSN.com and AskGamblers, which was acquired by former parent company GiG in 2023.
In terms of strategic realignment, Gentoo hopes to save €8m – €10m, and to reorganise the business for future growth. Refining leadership, commercial excellence and prioritisation were also noted, as well as to “become the most attractive employer in the industry” through a stronger people agenda.
Rounding the session off with a Q&A, Warrer was asked about the ever-present evolution of AI and its impact on the business. Warrer said search patterns had changed little, with players seeking out human recommendations on their sites, though when it came to the internal business, AI did offer benefits.
Optimisation of business, admin, design and repetitive tasks would allow the business to run smoother and with more capacity to scale, though the affiliate is keeping a close eye on AI and how it may change how players search for content. However, if Gentoo “keeps adding value services so users come to our sites by themselves,” Warrer did not seem overly concerned.
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