“Our North Star has always been organic growth.”

While it came eight years after Charles Gillespie registered his first gaming industry related domain name - StartGamblingOnline.com in the summer of 2003 – the Gambling.com story really begins in 2011: “The previous owners of Gambling.com, which was a UK listed company, were in deep [trouble] and needed to raise money quickly. They tried to auction the domain name for $9 million; they took $2.5 million from us so they wouldn’t go bust.” (Gillespie and Kevin McCrystle are still at GAMB, as CEO and COO, respectively.)

In 2021, a decade after the Gambling.com purchase, the company went public at $8 per share. While its corporate name reflects that 2011 deal, Gambling.com (GAMB) has since grown into a portfolio of 50+ websites where bettors can compare gambling operators, i.e. the deposit bonuses offered by online casinos (iGaming) and online sportsbooks (OSB’s).

GAMB’s revenues, which totaled $127 million in FY24, are primarily attributable to payments from gambling outlets in exchange for recruiting customers to their platform (GAMB’s top ten customers accounted for ~25% of its YTD FY25 revenues, down from ~50% in FY22). As shown below, the company sourced ~479,000 new depositing customers, or NDC’s, for its operator clients during FY24, a roughly 6x increase from five years earlier.

The company’s geographic focus was historically the UK & Ireland, which accounted for ~70% of its FY19 revenues; that changed with legalization of iGaming and OSB’s in certain U.S. states, with North America accounting for 50% of GAMB’s YTD FY25 revenues. (As shown on slides 26 and 27, online gaming remains nascent in the U.S. compared to mature European markets.)

Therein lies a straightforward thesis: as legalized iGaming / OSB arrives in new markets like the U.S., there’s competition among various operators to win and retain new customers; GAMB has a proven ability to source bettors, which underlies its solid financial trajectory over the past five years (revenues and adjusted EBITDA were up ~6x and ~4x, respectively, for FY20 - FY25e).

And yet, the stock price is telling a different story: GAMB closed on Friday at ~$4.9 per share, down ~65% from where it traded a year ago.

Gillespie, for one, sees opportunity.

TSOH Investment Research

GAMB: Conviction vs Capital Allocation

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