GAN Limited, an iGaming operator and supplier, has released its financial results for the quarter ending June 30, 2024. The company reported a 5% increase in revenue, reaching $35.6 million. The company’s performance was marked by growth in the B2B segment, while the B2C segment faced challenges. Operating expenses were reduced significantly, contributing to a decreased net loss.
Revenue Overview
For the second quarter of 2024, GAN Limited achieved total revenue of $35.6 million, reflecting a 5% increase compared to the previous year’s second quarter. This growth was driven by a substantial rise in the B2B segment, which saw revenue reach $13 million. This figure represents a notable increase from $9.9 million in Q2 2023. The rise in B2B revenue was largely due to GAN’s expansion in Nevada and the recognition of revenue from the exit of a B2B partner in Michigan.
Conversely, the B2C segment experienced a decline, with revenue falling to $22.6 million from $23.9 million in the same period last year. This decline was attributed to decreased player activity in Latin America and lower margins resulting from unfavorable event outcomes. However, the growth in European markets, driven by increased player activity, partially offset these losses.
B2B Segment
The B2B segment’s revenue growth to $13 million was a key highlight. GAN’s expansion efforts in Nevada contributed significantly to this increase. Additionally, the company recognized revenue associated with the exit of a B2B partner in Michigan. These factors combined to bolster the B2B segment’s performance.
B2C Segment
Despite strong performance in European markets, the B2C segment faced challenges. Revenue decreased from $23.9 million to $22.6 million. This decline was due to reduced player activity in Latin America and lower margins influenced by unfavorable event outcomes. While European markets showed growth, it was not sufficient to counterbalance the losses in other regions.
Operating Expenses and Net Loss
Operating expenses for Q2 2024 fell to $25.1 million. This reduction was attributed to several factors, including lower compensation costs, a reduced headcount due to ongoing cost-saving initiatives, and decreased depreciation and amortization expenses from intangible assets fully amortizing in the prior year.
The company’s net loss for the quarter was $1.7 million, a significant improvement compared to the $18.4 million loss reported in the same period the previous year. The reduction in net loss was primarily due to increased revenues and lower operating expenses. The previous period’s loss was exacerbated by an $8.8 million loss on debt extinguishment, which was not present in the current quarter.
CEO Statement
Seamus McGill, GAN’s Chief Executive Officer, expressed satisfaction with the company’s operational progress. He noted that GAN achieved top-line revenue growth in the second quarter while also reducing operating expenses. McGill emphasized the company’s commitment to operating more efficiently and focusing on improved profitability.
Looking forward, GAN’s strategic focus remains on optimizing its cost structure and rolling out product enhancements. The company is also progressing with its planned merger with SEGASAMMY, with expectations for a successful closing in late 2024 or early 2025.
Leadership Update
In April, GAN Limited appointed Brian Chang as the permanent Chief Financial Officer. Chang had been serving in an interim capacity since November 2022 and will continue to guide the company through the finalization of the merger with Sega Sammy Creation.
GAN Limited’s financial results for Q2 2024 demonstrate a positive trajectory with increased revenues and reduced losses. The company’s operational improvements and strategic focus on cost efficiency are contributing to its overall performance. With upcoming product enhancements and the anticipated merger with SEGASAMMY, GAN is positioning itself for future growth and success in the iGaming industry.