Raketech announced that revenue was down by 48.5% for Q1 2025 compared to last year, as it subsequently adjusted its earnout payment structure to the former owners of Casumba.
The affiliate’s revenue for the period between January and the end of March only reached €9.8 million (£8.3 million/$11.1 million) compared to 2024’s €19 million. In fact, Raketech faced slumps across the board on most metrics for the quarter as its reported EBITDA was down 50.8% year-on-year to €2.1 million and its adjusted EBITDA by 52.6% to €2.4 million. It then posted an operating loss of €219,000 for the start of the year, with a €75,000 adjusted operating profit.
These financial results were impacted by the continued low performance of Casumba, which it purchased in 2019 for €2 million. The brand struggled primarily in traditional affiliate marketing and its subaffiliation verticals. Its reach with new depositing customers also fell by 67.7% from Q1 2024 to 19,277 in the period.
The affiliate also acknowledged that it is in the final stage of its strategic review on non-core US tipster and subscription assets, which had a negative EBITDA impact of €300,000 in Q1.
Raketech did, however, post €1.7 million in free cash flow before earnouts, as it clarified that €6 million worth of earnouts were settled during the quarter, with another €2 million due in Q2. The remaining earnout of €20.6 million left on its books has now been extended to March 2028, including that of Casumba.
The Casumba extension has removed the option for partial settlement in shares, while the revision provides the affiliate with greater financial flexibility, with payment now planned over a longer period of time.
Partnership growth
Raketech also announced that during the quarter, it grew its partnership model to now account for around 50% of affiliate marketing revenue. In February, the affiliate announced that it would be handing over editorial control of its assets to partners, while handling commercial agreements, sales, finance, reporting, data management and technology.
“The partnerships allow Raketech to retain ownership while leveraging its centralised capabilities in commercial agreements, finance, reporting, data, and technology,” said CEO Johan Svensson. “
He also reconfirmed the company’s commitment to building and scaling its AffiliationCloud platform. “Through AffiliationCloud, we integrate assets managed in-house and via affiliation marketing, along with our subaffiliation, into a single, unified system. This structure supports more efficient operations, better use of data, and greater predictability across all areas.”
This is supported by Svensson’s comments that the company will continue to focus on diversifying its traffic streams to reduce dependency on SEO. This includes expanding its CRM activities and investing in products with a higher proportion of returning visitors - TV sport guides were named as one example.
The Raketech CEO also acknowledged that Q1 was a period of strategic consolidation and operational focus, given its results. “Despite a year-on-year revenue decrease, we have made good progress in aligning the business around our platform-first model and long-term growth priorities.”
Product & regional focus
The company’s traditional affiliate operations suffered a 31.6% drop from 2024 in the quarter, down to €6 million, while still representing 61.5% of total revenue. Subaffiliation was dented by a further 61.6% decrease that took it down to €3.4 million and under half of 2024’s €8.8 million.
Casino activities still dominated Raketech’s revenue stream with 78.9%, but this was a little over half down from 2024's €15.5 million to €7.7 million, while sport operations suffered a 41% decrease to €2.1 million.
The Nordics rose up to represent 54.3% of total group revenue, which suffered the lowest of all regional decreases at 35.2%, leaving revenue at €5.3 million for the quarter.
US revenue took the biggest hit with a 65.5% fall, however, the region only made up 6.2% of the group’s total revenue with €608,000. Similarly, the rest of Europe dropped by 52% in revenue to €409,000, while the rest of the world also tumbled by 57.9% down to €3.4 million.
Freeing up expenses
Raketech was able to mitigate its publisher cost from €6.9 million to €2.7 million year-on-year, while cutting other direct expenses by €200,000.
The affiliate reduced its headcount from 148 to 102 year-on-year and reduced employee benefit expenses from €3.2 million to €2.1 million. Contractor numbers were also cut in the same period from 91 to 38, with the company acknowledging the metrics as a sign of its positive restructuring.
While not listing explicit targets for the rest of 2025, Raketch’s statements seem to pin its focus on scaling its partnerships and subaffiliation business as well as diversifying traffic streams away from SEO.