Catena Media reported further revenue drops across the board following a flat performance in its sports activities and impacts from Google updates, which also saw it ditching long-standing plans to develop AI content for its brands.
The affiliate posted a revenue of €49.6 million (£41.42 million/$51.5 million) for 2024, representing a 35% drop from €76.7m in 2023. Its adjusted EBITDA from continuing operations decreased 79% to €5.4m, down from €25.4m in the previous year. Revenue from Q4 was also 30% lower year-on-year at €10.2m, while direct costs were reduced 58% from €3.3m in Q4 2023 to €1.4m in Q4 2024.
Manuel Stan, CEO at Catena Media, said the Q4 results “reflected the ongoing challenges we face in our core markets” while noting the company’s “profitability improved following the measures taken since mid-year to streamline the cost structure” for two consecutive quarters. These include terminating media partnerships and streamlining its content production and marketing teams in October, which reduced the group’s headcount by more than 10%.
Google updates impact
Stan attributed the “unsatisfactory” performance to “the impact of two Google algorithm updates in Q4”, which created high volatility levels in the affiliate’s casino-facing organic search operations. Catena’s Q4 casino revenue decreased by 15% to €7.6m year-on-year, while sports revenue was down by 54% to €2.5m. However, new depositing customers (NDCs) increased by 11% in the casino segment during the period.
While Google’s updated Site Reputation Abuse (SRA) policy last year restricted the potential of media deals, Catena Media announced a partnership with the US horse racing news publisher Daily Racing Form (DRF) last December.
“In contrast to our previous media partnerships, the relationship with DRF is built on clear mutual value and aligned incentives. The partnership exemplifies the type of strategic relationship we seek – one that drives sustainable profitability for both parties. I look forward to seeing this collaboration reach its full potential,” said Stan.
AI plans dumped
Catena also announced the discontinuation of an AI-based content generation platform, which affected its operating profit with a €1.2 m non-cash impairment charge, though an agreement was reached to recoup €0.7 million of the original investment. iGBA understands that the platform never became active on any sites operated by Catena.
In 2023’s Q4 report, then Catena CEO Michael Daly said that the affiliate would facilitate the introduction of new tools to improve its organic search competence through AI. “We are currently implementing a wide-ranging internal investment programme – including large investments in both tech and AI – to fast-track our ambition to be the data- and technology-driven leader of online affiliate marketing in the sports betting and casino gaming space,” said the acting CEO in February 2024.
Commenting on the project’s liquidation, Stan said Catena continues “to see AI as an important business enhancer, for example in scaling up content output”.
“However, the new board and management did not deem this venture to be an optimal way to realise the opportunity.”
Region breakdown
The company reported a 35% drop in the North American market’s revenue from €67.1 million in 2023 to €44.0 million in 2024, with adjusted EBITDA decreasing 47% to €18.3 million. Total revenue in other markets dropped 41% from €9.7 million to €5.7 million, while adjusted EBITDA increased 36% to €3.2 million.
While in Q4, Catena saw its North American revenue drop 28% from €12.3 million down to €8.9 million, with adjusted EBITDA up by 4% to €4.5 million. In other markets during the quarter, revenue was down 41% to €1.3 million, with adjusted EBITDA decreased by 31%. North America remains the affiliate’s dominant revenue source with 87%, while CPA deals make up 78% of the revenue brought in.
Both the casino and sports sectors in the North American market remain challenging for Catena Media, which experienced revenue declines of 12% and 56% in these two segments. The affiliate notes that key factors affecting performance include a reduction in spending by operators in esports, instability caused by Google algorithm updates, a slowdown in the legalisation of sports betting and the termination of media deals.
Readdressing priorities
The Catena CEO said the affiliate “has in the past spread its resources too thinly across multiple initiatives, diverting attention from core products”. In 2025, the group seeks to concentrate on its top-performing sites and products
“To improve execution and accountability in this leaner approach, we in Q4 introduced objectives and key results metrics (OKRs) across the organisation. Though this may seem a basic step, aligning all personnel around key priorities, tracking performance consistently and ensuring focus on the highest-impact areas is critical to our success,” said Stan.
Other growth measures introduced in 2024 included improvements in “primary product’s alignment with Google’s web core vitals”, key hires such as directors of SEO, data and engineering and enhancement to “a new customer relationship management (CRM) system”.
Moreover, Stan emphasises that Catena’s outstanding net debt of €12.9 million will be settled upon receipt of the €15m proceeds from the AskGamblers sale to Gentoo Media in Q1 2025.
Catena acknowledged the target to hit double-digit organic growth in both revenue and adjusted EBITDA for 2025 and 2026 and to bring the net interest debt to adjusted EBITDA ratio to between 0 to 1.75.