Gambling.com Cuts 25% of Jobs in AI-First Shift as Q1 Earnings Hurt By Rising Costs
Gambling.com earnings show a firm that's accelerating its AI-first restructuring as it cuts jobs and seeks to wean the business off volatile SEO.
Gambling.com Group (GAMB) reported Q1 2026 revenue of $40.4 million, beating the $40.2 million estimate, while announcing a 25% cut in staff as part of what incoming CEO Kevin McCrystle described as “our transition to an AI-first company.”
The flat bottom-line performance was due to higher cost of sales and increased marketing expenses, driven by the company’s accelerating shift away from traditional organic SEO search.
Adjusted EBITDA skidded lower by 43.4% YoY to $9.0 million, and adjusted EPS cratered to $0.09 from $0.46 a year ago (an 80.4% decline). Still, the results came in ahead of analyst forecasts, with EPS a 28% beat (see our table below).
Management Expects $13M in Savings From Job Cuts
Management expects the job losses to generate $13 million in annualized savings, with approximately half of that amount realized in the second half of 2026. In written comments accompanying the release, McCrystle focused on the company’s restructuring efforts:
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 annualized cost savings.”
Key highlights from the earnings included the revenue growth in Sports Data Services, which was up 13%, even though the legacy marketing side of the business saw revenues decline 5%.
In a familiar story, the volatility of Google search algorithm updates impacted performance. Regulatory friction in Finland and tax hikes in the UK didn’t help matters either.
Adjusted EBITDA margin has contracted from 39% a year ago to 22%. Management put this down to the “near-term margin impact” of scaling more expensive non-SEO traffic channels.
Analysts Press for More on Restructuring Execution Risk
On the earnings call, senior equity research analyst at Stifel, Jeffrey Stantial, probed management about execution risk related to the 25% headcount reduction and how the one-time implementation costs might impact the balance sheet.
In response, CFO Elias Mark said, “We anticipate the restructuring expense to be in the region of $2.5 million.”
McCrystle followed up to reassure analysts that cutting what amounts to a quarter of the staff wouldn’t impact output.
“Quality is key,” McCrystle asserted. He noted that 80% of new engineering code across the company is already generated by AI, compensating for the lost human capacity.
On that last point, which speaks to trends being played out at other software-reliant companies, McCrystle highlighted new AI integrations, including partnerships with Claude and Perplexity, to modernize user engagement:
A key driver of our ability to have the most innovative sports data enterprise solutions is our increasing integration with customer AI touchpoints… OpticOdds now has an MCP integration into Claude and has entered into a partnership with Perplexity to be the odds data provider across their product suite.”
Gambling.com Cuts FY 2026 Guidance
During the earnings call, Mark announced a downward revision to the company’s full-year 2026 guidance. FY 2026 net revenue was guided lower from the $170-$180 million range previously to $165-$170 million.
Similarly, adjusted EBITDA has also been revised lower, from $50-$58 million to $45-$50 million.
Leadership blamed the guidance cut on traffic diversification costs, regulatory headwinds in Finland, and the tax rises in the UK and Ireland, mentioned earlier.
Addressing the pressure on margins evident in the less aggressive guidance, Mark did have some potential good news for the latter half of the year:
“We updated our full-year 2026 guidance for revenue to be in the range of $165 million to $170 million and adjusted EBITDA to be in the range of $45 million to $50 million… we expect margin expansion and significant sequential growth in revenue and adjusted EBITDA in the second half of the year as the restructuring savings take effect.”
Management Reveals Recurring Streams now 49% of Revenue
Analysts and investors will continue to concentrate their collective gaze on how Gambling.com navigates the transition from a high-margin, SEO-dependent affiliate business to a lower-margin but more resilient omnichannel operator.
Although the restructuring plan indicates a proactive approach to protecting profitability, the immediate response, as seen in after-hours share price action, was negative, with the stock down 28% to $2.97.
Market participants are well aware that the marketing segment’s organic reach remains under pressure.
However, Mark pointed to Gambling.com recurring revenue streams growth – now accounting for 49% of total revenue – which will probably be increasingly viewed as a stabilizing force in the volatile gambling affiliate space.
| Period | Metric | Actual Result | Consensus Forecast | Beat / Miss (% Diff) | YoY Change (Annual) | QoQ Change (Quarterly) |
| Q1 2026 | Net Revenue | $40.44M | $40.22M | 🟢 Beat (+0.55%) | -0.50% | -12.50% |
| Adj. EPS | $0.09 | $0.07 | 🟢 Beat (+28.6%) | -80.40% | -70.00% | |
| Adj. EBITDA | $9.00M | $8.90M | 🟢 Beat (+1.12%) | -43.40% | -41.90% | |
| Q4 2025 | Net Revenue | $46.24M | $47.33M | 🔴 Miss (-2.30%) | +31.0% | +18.6% |
| Adj. EPS | $0.30 | $0.21 | 🟢 Beat (+42.9%) | -14.30% | +15.4% | |
| Adj. EBITDA | $15.46M | $15.10M | 🟢 Beat (+2.38%) | +5.0% | +18.9% | |
| Q3 2025 | Net Revenue | $38.98M | $41.06M | 🔴 Miss (-5.06%) | +21.0% | -1.50% |
| Adj. EPS | $0.26 | $0.20 | 🟢 Beat (+30.0%) | -16.10% | -29.70% | |
| Adj. EBITDA | $13.01M | $12.80M | 🟢 Beat (+1.64%) | +3.0% | -5.00% | |
| Q2 2025 | Net Revenue | $39.59M | $38.93M | 🟢 Beat (+1.70%) | +30.0% | -2.60% |
| Adj. EPS | $0.37 | $0.35 | 🟢 Beat (+5.71%) | +42.3% | -19.60% | |
| Adj. EBITDA | $13.70M | $13.20M | 🟢 Beat (+3.79%) | +22.0% | -13.80% | |
| Q1 2025 | Net Revenue | $40.64M | $40.07M | 🟢 Beat (+1.42%) | +21.0% | — |
| Adj. EPS | $0.46 | $0.44 | 🟢 Beat (+4.55%) | — | — | |
| Adj. EBITDA | $15.90M | $15.50M | 🟢 Beat (+2.58%) | — | — |
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