Key Points
- Revenue went up by 23% to €46m, but betting turnover only beat last year by a hair, just 3%.
- Kambi’s full-year forecast is starting to look dire: €26m in revenue leaves a whole lot of nothing left over by Q4, just €4.8m to be exact, compared to the €7.9m pocketed in Q3.
- The bad news in Brazil, a ban is going to hit Kambi for around €1m in Q4, and LeoVegas leaving will set the company back twice as much.
Kambi Posts a Massive 161% Profit Increase but Still Expects a Q4 That’ll Probably Disappoint
Kambi made a tidy €7.9m in Q3, more than doubling last year’s figure of €3.0m. Yet the company now thinks it’ll only make around €4.8m in the final three months of 2026, that really is a 40% drop.
The difference is the company’s full Q3 report gives a pretty good idea of why. The management team went over it in even more detail during the earnings call.
Revenue went up a healthy 23%, but Betting Turnover Increased by a Mere 3%
Kambi managed to bring in a nice €46.0m, compared to €37.4m at the same time last year. The betting turnover, a measure of the sheer amount of betting going on was really only up by 3%. The real growth was coming from other areas.
The company built in €4.2m worth of higher-priced World Cup data costs in their revenue, and duly passed these costs on to the operators. This cost didn’t add to profit, but it did cut the gross margin from 85.8% down to 80.9%. The stronger Colombian Peso also added €1.7m on a like-for-like basis.
All told, those two things added up to around €5.9m of the €8.6m revenue boost, or roughly half if you just add the numbers up.
The operator trading margin, the cut the operators take after paying out winners, rose to 11.9%. This was a full 1.6% higher than last year at 10.3%. Chief executive Werner Becher said this was the second highest this company has ever seen.
The World Cup final took place in mid-July, within the reporting period. Becher described it as a record breaker. But the sports results were a bit more unfavourable in August and September.
Profit Shot Up Sharply as Operating Costs Barely Bumped Up
Operating costs really only went up by a hair, from €29.0m to €29.2m. Meanwhile gross profit jumped by €5.1m. Operating profit soared to €5.1m, an increase of 214%, and with an operating margin of 11.1%.
Pre-tax profits were up by an astonishing 183% to €5.2m. Tax expenses jumped to €1.8m, almost double last year’s €0.8m. Kambi reported a profit of €3.4m, a rise of around 232% on €1.0m. And the earnings per share shot up too, more than tripling to €0.128 from €0.036.
A currency translation loss of €0.2m brought the final comprehensive income figure down to €3.2m. Still, even with that loss it was a massive 640% higher than the €0.4m reported last year.
Around €4.8m to Reach Adjusted EBITA Guidance
Kambi sees the full-year adjusted EBITA (ACQ) coming in around €26m. Previously, the company guided the figure in a range between €23m and €27m. The new estimate is €1m higher than the median of the old range and €1m lower than its previous upper bound.
Kambi has already reported adjusted EBITA of €21.2m for the first nine months of 2026. To reach €26m for the entire year, the company needs around €4.8m in Q4. The figure is calculated on the basis of the reported numbers, not a separate guidance for Q4 issued by the company. Furthermore, it is significantly lower than €7.9m reported in Q3.
In the company’s earnings call, the CFO David Kenyon pointed out the reasons for the anticipated Q4 pressure. In particular, Brazil will cost around €1m. The change in partnership with LeoVegas in Sweden and the UK will cost around €2m.
The termination fees relating to Mohegan Sun will cost the company around €600,000. Moreover, management expects the trading margin to drop to about 11%.
As Becher reported on the earnings call, the FDJ UNITED migrations are on hold. There is no information on when they will start again. Kambi hasn’t issued guidance for 2027 yet. Moreover, management expects the lack of the World Cup to be a negative factor.
As of 30 September, cash was at €40.9m. Kambi spent more than €13m on share buybacks over the year.
Brazil’s Regulatory Move Hurts Current Profit and Future Growth Potential
Brazil represents just €1m of the anticipated cost impact for Q4. Nevertheless, it still remains an important factor for Kambi’s future.
On 25 September, President Luiz Inácio Lula da Silva signed Provisional Measure 1,394. It introduces a ban on fixed-odds betting in Brazil. Licensed gambling websites stopped operations on 6 October. On top of it, Lula has just been re-elected for the second time in his presidency on 25 October.
According to Kambi, Congress has to approve the ban by 23 November. Otherwise, it will expire. Moreover, the congress timetable provides for an automatic extension of 60 days if the voting process has not been finished.
Brazil represented a low single-digit percentage of Kambi’s 2026 revenue, so the financial effect on Kambi will be rather small. Becher called regulatory moves in Brazil “disappointing” and pointed out that the ban may take the growth potential from the country.
Nevada Partnership & AI Trading Gives Kambi an Edge in Expansion Plans
The Americas account for 59.9% of Kambi’s sportsbook turnover, up a smidge from 57.9%. That’s a 6.7% increase, though it’s worth noting that European turnover took a 3.1% hit, mainly due to a few operators high-tailing it out of the region according to Kambi.
Regulated markets still make up 98.5% of sportsbook turnover, a slight dip from 98.4% a year ago, but hey, not a bad try.
Kambi’s just inked a ten-year deal with Station Casinos in Nevada, their first partnership in the state. Becher says Station Casinos is getting set to kick off its Nevada regulatory field test within weeks.
AI is now handling 85% of bets across Kambi’s network, which is pretty cool. 59% of live bets traded by AI are settled in zero seconds, no delay at all.
Kambi’s headcount took a hit, from 995 to 939 during the quarter. Becher reckons that integrating Abios, Shape Games and Tzeract has left the company a more streamlined and agile outfit.
A Solid Recovery After a Bit of a Dull 2025, And a World Cup Boost
Kambi was up against it, as Q3 2025’s revenue was a bit of a downer at 13.1% to €37.4m and they had to lower their full-year forecast.
But the recovery started a bit before all this. Q1 revenue was up 4.9% to €43.5m. On 22nd July, Kambi came in with Q2 revenue of €45.9m, up 13.5%, and they ended up raising their adjusted EBITA guidance to €23m to €27m.
The World Cup saw operator trading margin reach a whopping 18% in that month. Becher said Kambi was basically out of the woods. Across the full quarter though, it averaged out at 11.9%.
At the end of August, Kambi brought Abios, Shape Games and Tzeract together under one umbrella, launched the slogan “Powerful Network. Proven Edge” and gave AI and network data from more than 70 partners a lot more play.
Key Dates That Might Affect Kambi’s Future Outlook
Brazil’s Congress is set to take a hit to its agenda starting 9th November. The first big deadline is 23rd November when the provisional measure is due to expire unless Congress sort it out or pushes back the timeline.
It all comes down to whether betting is going to be legal in Brazil and what form it will take. A vote, an amendment or an extension, that’s the way to go.
The Nevada regulatory field test is expected to get going within weeks. We’ll also see if Kambi can hit their implied adjusted EBITA target of around €4.8m in their Q4 results.
Kambi Expert Analysis: AI or the World Cup?
For us, Kambi’s Q3 performance was essentially determined by the World Cup, while AI plays second fiddle here. Turnover increased by only 3%. Data and currency costs explain €5.9m out of the total €8.6m growth in revenues. The management is also forecasting the trading margin to drop to 11% in Q4.
Supporters of Kambi’s AI-driven model may point out that automation of trading contributed to achieving the 11.9% margin. This can be proven by the company’s claim that 85% of all network bets are processed by AI. However, Kambi has not published a separate trading margin for the bets processed via AI yet. Thus, we cannot make any conclusions about its profitability on the basis of this information.
Some headlines refer to the new guidance as a “raise”. The choice of words is certainly more positive than the numbers themselves. The high end of the old guidance range dropped by €1m. A result of Q4 adjusted EBITA at €4.8m will be the worst quarterly result in 2026 even compared to €5.7m in Q1.
Brazil’s cost effect of €1m, in our opinion, has less importance compared to the loss of further growth potential in this market. The absence of contribution from Brazil is already assumed by the new guidance, so lifting the ban will only be additional good news for Kambi.
If AI really improves Kambi’s trading margins, then, under usual conditions, they should stay close to 11.9%, while management estimates around 11% in Q4. Which margin provides a clearer picture of Kambi’s usual trading performance?
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