Betsson has revealed that Latin America has emerged as its most significant market in the second quarter of the year, contributing 36% to the operator's total revenue of €310.2 million. The region saw a 32% increase in revenue year-over-year, reaching €112 million. CEO Pontus Lindwall commented on the robust performance, attributing it to substantial demand in sports and casino segments across Argentina, Peru, and Colombia.
"We have long targeted Latin America as our largest market," Lindwall remarked. "While we didn’t announce at the outset that this would be our biggest region in the future, we prioritize investment in markets that show strong traction and profitability potential, and LatAm fits that profile well."
He pointed out that the growth prospects in Latin America are more favorable compared to Western Europe. The revenue from Latin America amounted to €64.2 million, making up 21% of the operator's overall revenue in the quarter, which itself was an 8.3% rise from the previous year.
In contrast, Betsson's revenue in the Nordic countries fell by 17% as the company reduced its marketing expenditures in Sweden and Denmark. Lindwall explained, "The markets are quite competitive, it's expensive to acquire new customers, and the regulations are quite strict. We face challenges from unlicensed operators in many European jurisdictions."
"Given the effectiveness of our investments, we see greater value in focusing on markets outside the Nordics," he added.
During the earnings call, Lindwall discussed a new €75 million credit facility intended to support working capital and future acquisitions. "Our strategy is to expand both organically and through M&A, which provides us with additional flexibility for such activities. Historically, we have made acquisitions that enhance our existing business and enabled us to enter new markets where we previously lacked a presence," he explained.
Lindwall identified further opportunities in Latin America for future expansion, focusing on countries where the operator does not currently operate.
In light of the World Cup, Betsson experienced increased revenue but faced challenges due to a decline in B2B revenue, affected by reduced activity from one of its key clients. Despite a 31.9% rise in active customers in its B2C segment, which reached 1,825,487, total customer deposits across both B2C and B2B were down by 7% from the previous year, totaling €1.38 billion.
The operator's gross profit fell 8% year-on-year to €177.5 million, resulting in a gross profit margin of 57.2%. Conversely, its regulated revenues climbed 17%, now constituting 75.5% of total group revenue.
Lindwall also highlighted various upgrades made to enhance Betsson’s operations during the World Cup, including technical improvements allowing sites to manage up to five times the normal traffic. He expressed satisfaction with the sportsbook’s performance from a technical perspective, noting, "We implemented numerous user experience improvements to facilitate easier navigation for our customers."
Additionally, Lindwall mentioned early-stage investments in AI technology to bolster Betsson’s operational efficiency, stating, "While our use of AI is still in the nascent phase, it is integrated across many of our operational processes. We anticipate that its application will expand even further."
