Gentoo Media boosts profitability and margins despite Q1 revenue decline

Revenue for the quarter fell to €24 million (£20.8 million/$27.8 million), impacted by weaker sports betting margins in February and the company’s strategy of prioritising more profitable traffic over pure volume growth. However, EBITDA before special items rose 19% to €10.5 million, lifting the EBITDA margin to 44% from 35% in Q1 2025.

The margin improvement followed major cost reductions implemented during 2025. Gentoo cut costs during the quarter by €3 million, equivalent to annualised savings of around €12 million, largely through reducing headcount from 404 employees to 292.

CEO Jonas Warrer said the business had entered 2026 with “a more stable and efficient operating model”.

He added: “The work completed in 2025 has created a stronger foundation, with lower costs, improved focus and a clearer path towards sustainable profitability and cash generation,” he said.

Operating cash flow increased 61% year-on-year to €7.4 million, driven by stronger profitability and improved cash conversion.

Flagships and local heroes

The Nasdaq Stockholm-listed group, which owns AskGamblers, CasinoTopsOnline and Casinomeister, said its flagship and local-market brands continued to deliver solid traffic and sign-up momentum. The company also continued investing in sports, automation, AI-driven operational improvements and elevating visibility across both traditional search and AI-driven environments.

“This underlines the continued quality of our audience and the value delivered to our partner operators, even during periods where revenue share conversion is temporarily impacted by sports outcomes and market mix”, said Warrer.

AI acceleration

Gentoo said AI adoption accelerated across the business during the quarter. AI-assisted development supported an upgraded AskGamblers search experience, while AI tools were increasingly leveraged into SEO, content moderation and spam detection. The company also completed the first phase of integrating generative AI into design workflows, freeing up teams to focus on improving complex user journeys and strategic UX.

Stability in the storm

The business also highlighted stable search performance despite ongoing Google algorithm volatility. Gentoo added that the March Google Spam and Core updates had a net positive impact on its overall core portfolio, particularly in higher-value markets.

Although first-time depositors (FTDs) fell to 81,400 from 95,100 a year earlier, Gentoo attributed the decline to more disciplined paid media spending, reduced exposure to lower-return channels and broader portfolio simplification initiatives introduced last year.

Value over volume

At the same time, deposit values exceeded €200 million for the second consecutive quarter, which the company said reflected continued strength in player value and engagement.

“We continue to prioritise higher-quality traffic acquisition and stronger long-term monetisation opportunities over pure volume growth,” Gentoo said.

The company also strengthened its balance sheet during the quarter, fully repaying its €18 million revolving credit facility through a shareholder-backed loan structure. Interest-bearing debt has been reduced by €18.1 million since the start of 2025.

Looking ahead, Warrer said the company remained focused on its stated 2026 priorities: “[D]riving higher-quality revenue, strengthening flagship brands and integrating AI-driven capabilities across content, product and acquisition channels.”