Kambi, a leading sports book supplier, reported a stronger-than-expected operating profit for the third quarter of 2024. The company delivered EBITDA (earnings before interest, tax, devaluation, and amortization) that exceeded Pareto Securities’ estimates, as well as analyst consensus, by over 20%. However, the results included positive one-off items, which Pareto had not factored into its forecasts. Adjusted for these items, Kambi’s EBITDA came in 2% below Pareto’s original forecast, leading the analyst firm to comment that the underlying result was slightly worse than anticipated.
Despite this, Kambi’s revenues were in line with expectations, and there were several positives in the quarter. Notably, Kambi secured new agreements with key partners, including Svenska Spel and Livescore Group. These partnerships are expected to have a significant impact on the company’s revenue starting in Q2 2024, further strengthening its market position.
Looking ahead to Q4, Pareto noted that Kambi’s operating expense (OPEX) guidance of €38-41 million, at constant foreign exchange rates, aligns closely with Pareto’s own estimate of €40 million. This indicates that Kambi is on track to meet its financial targets for the remainder of the year.
As of now, Pareto maintains a “Buy” rating on Kambi, with a target price of SEK 200. Despite the slight miss on underlying earnings, the company’s strong growth prospects and strategic partnerships position it for continued success in the competitive sports betting market. Investors remain optimistic about Kambi’s future performance and its potential for long-term growth.
