GAN, a major NA B2B provider of iGaming technology provider and an International B2C operator of online sports betting, has published its Q1 2023 report, highlighting its performance during the three months ended March 31.
GAN reported total revenue of $35.1 million, representing a slight 6% year-on-year decrease. Both the B2B and B2C verticals were impacted by the decline, with the company posting $11.3 million B2B revenue and $23.9 million B2C revenue against $13.1 million and $24.4 million in Q1 2022, respectively.
GAN attributed the B2B decrease to a decrease in the company’s contractual revenue rates with its largest customer. The B2C segment, meanwhile, was negatively impacted by the shifting currency rates and the declining US dollar.
Meanwhile, GAN’s operating expenses increased from $29.9 million in Q1 2022 to $31 million in Q1 2023. Adjusted EBITDA plummeted to $39,000 from $3 million in Q1 2022.
Despite the many negatives, GAN reported a net income of $1.5 million in Q1 2023, far surpassing the $4.5 million net loss it recorded in Q1 2022. This was primarily driven by a gain attributable to an amendment of one of GAN’s Content Licensing Agreements.
GAN also reported $40.8 million in cash as of March 31, 2023, representing a noticeable decline from the $45.9 million in the prior year quarter.
Gan Is Optimistic about the Results
GAN’s CEO, Dermot Smurfit, commented on the matter, saying that the quarterly results are satisfactory in spite of the slight declines across the board. He said that the metrics remain encouraging and that GAN expects its strategy to pay off and improve its profitability in 2023.
According to Smurfit, GAN will now lean into its GAN Sports US subsidiary and will rely on select international B2C markets.
Smurfit noted that GAN is also progressing in its strategic alternatives review and is evaluating the opportunities it has to maximize shareholder value.
Our recent announcement and term loan transaction bolstered our financial position and allowed us to modify the conditions of our term loan, significantly reduce our interest expense, and strengthen our balance sheet.
Dermot Smurfit, CEO, GAN
Smurfit clarified that this transaction should be considered a key step in the broader company review process. According to him, it will allow his team to evaluate the available options from a stronger position.
The CEO concluded that GAN has been pleased with its strategic review so far. He promised that the company will provide updates as the process continues but noted that there is no timetable for its completion.