Betting group Betsson AG announced its Q1 results, showing a drop in operating profits. The company performed well in emerging markets in Latin America, however, where esports betting is gaining traction.
Revenue for the quarter reached €285.3m ($334 million), a 2.9% decrease from Q1 2025. Operating profit almost halved year-on-year from €64.0m ($75 million) to €34.0m ($39.8 million), while net profit was down 47.3% to €25.5m ($29.9 million).
In Latin America, growth was strong, with revenue up 24.7% to €93.0m ($109 million). The region is now the second-highest contributor to group revenue, behind only Central and Eastern Europe, where revenue fell 21.8%.
Several countries in Latin America are beginning to open up regulated gambling markets, with esports betting gaining popularity in the region.
B2C Switch Seeks Longer Term Profiits At Higher Costs
The company attributed the fall in profits to a shift towards business-to-consumer services rather than higher-margin B2B operations.
Revenue in the B2B operations decreased to €51 million from €90 million, driven by lower revenue from one customer, according to the company.
The switch to B2C comes with higher license fees and payment provider fees, but CEO Pontus Lindwall said he believes the strategy will yield further profits in the future.
“These are markets that we believe in long-term, and all the markets that we have where we operate and are now profitable in B2C have taken many, many years to build up,” said Lindwall when announcing the results. “So that’s how the business is made, and we have to keep investing in the markets that we believe in.”
Casino Revenue Falls But Remains Dominant
Revenue from the company’s online casino products fell 4%, but still contributed over 70% of the group’s overall revenue.
Sports betting revenue, meanwhile, grew slightly by 0.6%. Betsson said additions to its sportsbook interface, including a new Bet Builder function, AI-powered match previews, and enriched live stats, can further increase revenue going forward.
Betsson has a partnership with Oddin, which provides it with esports odds feeds, live data and stats. The company has also been making increased inroads in Latin America and recently signed a partnership with the Paraguayan gambling company JugaMax.
Company Targets Global Expansion
The Swedish-based company saw its revenue in the Nordic regions fall 6.9%, with both Sweden and Denmark reporting declines. The company cited reduced activity in its casino product for the drop off.
In addition to expanding in Latin America, the gambling group, which operates more than 20 online gaming brands, is looking to break into Canada.
It recently acquired Rhino Entertainment Group’s B2C business, which is licensed in the country, as well as a number of technology assets for its B2B business.
“Our investments in recent years have strengthened our position and, with a competitive offering, a strong brand and a proven strategy, we are well positioned to capitalize on opportunities in the global online gaming market,” added Lindwall.
Investors were initially concerned by the drop in profits. The company’s stock price fell almost 6% after the results were announced, but quickly rebounded to 99.25 SEK ($10.6).