Raketech’s revenue falls as it cedes editorial control of four assets

Adjusted EBITDA for the quarter was 46.2% lower at €15.7 million, while the operating loss stood at €47.8 million, indicating an 1835.6% change from the €2.8 million gain in the same period in 2023. A non-cash impairment charge of €48.5 million was recognised in Q4 2024, primarily relating to a reduction in the intangible book value of non-core assets acquired pre-IPO.  Additionally, the number of new depositing customers fell by 62.9% to 28,014 compared to Q4 2023.

Full-year revenue totalled €61.2 million, a decrease of 21.3% from 2023, with adjusted EBITDA dropping 32.3% to €15.7 million. The affiliate experienced negative organic growth of -19.5% for FY24, with a significant year-on-year decline of 87.9% from 45.3% to -42.6% in the final quarter. 

Partnerships take control

The new strategic partnerships mean that going forward, Raketech will handle each asset’s commercial agreements, sales, finance, reporting, data management and technology, while the partnering entrepreneurs focus on product development, content creation, SEO and execution.

According to CEO Johan Svensson, around 50% of the company’s current affiliation marketing revenue is now in these strategic partnerships. He emphasised that Raketech has “partnered both with founders from previous acquisitions and other entrepreneurs who have a successful track record of running affiliation marketing assets”.

Svensson also highlighted the company’s efforts in reevaluating its affiliation assets and “their alignment with Raketech’s established commercial and operational strengths”. 

Affiliate marketing remains Raketech’s largest source of revenue, generating €29.7 million in the past year, which accounts for 48.6% of its total revenue. Sub-affiliation contributed 45.5% of overall revenue while betting tips and subscription income made up the remaining 5.9% in 2024. All sectors experienced significant declines in growth, with sub-affiliation revenue dropping 54.5% to €5.2 million in the final quarter, compared to €11.4 million in Q4 2023.

In the sub-affiliation segment, the CEO noted that the paid network business area “experienced positive momentum despite slightly lower overall revenues” compared to Q3 2024, highlighting the company’s strong relationships with operators and publishers.

Decline across segments

In 2024, Raketech experienced revenue declines across its casino and sports segments and geographical regions. Casino revenue totalled €49.4 million, reflecting a decrease of 21.7% from €63.1 million in 2023, while sports revenue for the previous year reached €11.8 million, a decline of 19.3% from €14.6 million. Revenues in both segments witnessed over 40% year-on-year declines in Q4 2024.

In the final quarter, the Nordics became the company’s largest revenue source, accounting for 52.2% of total revenue at €6.4 million. Revenue from the rest of the world (excluding the US and the rest of Europe) declined from 40.9% of total revenue in 2023 to 37.8% at €4.7 million. The affiliate also highlighted its expansion in Southern Europe and Latin America last year with the addition of the slot’s portfolio. 

Svensson acknowledged that traffic volumes from US digital tipster platforms had not met the affiliate’s expected outcomes following the sale of its land-based tipster business despite ongoing progress in “improving conversion rates and monetisation.” Overall, US revenue was €5.0 million in 2024, with a 59.5% year-on-year decline in Q4 to €0.8 million. 

Q4 in focus 

The affiliate announced a cost saving of 29% in Q4 2024 compared to the first quarter of the same year, excluding publisher costs. Employee benefit expenses totalled €1.9 million, down from €2.6 million in Q4 2023. The number of full-time employees decreased from 137 in 2023 to 106, while the headcount of contractors was reduced from 92 to 52. Raketech noted that this “represents primarily positive effects from organisational restructuring” as it centralised resources at the Malta headquarters. 

Publisher costs decreased to €4.2 million from €10.0 million in Q4 2023, driven by decreased activities in sub-affiliation. Other direct expenses were €1.3 million in the period. 

Moreover, Svensson emphasised that the decline in Q4 affiliation marketing revenue from the previous quarter was “primarily due to the performance of the Casumba assets” it acquired in 2019. Last October, Raketech issued around one million new shares to help pay the €18.3 million portion of the earnout to the founders of the Japanese-facing business. A reminder of €28.2 million is due in instalments by September 2026. 

Looking ahead 

In 2025, Raketech will “concentrate more on strategic partnerships, exclusive commercial agreements with operators and the development of AffiliationCloud”. 

The affiliate reported that its AffiliationCloud platform “continued to deliver 74% organic growth compared to last year” and called it “a key driver of growth in sub-affiliation.” This year, it aims to further invest in the platform by “securing exclusive agreements with operators and by providing a diverse group of publishers access to the deals Raketech negotiates with its extensive network of operators”. Migration of the Raketech Network business to AffiliationCloud will also start in Q1. 

Furthermore, Svensson confirmed the plan to conduct a strategic review of the US tipster and subscription business due by the end of Q1 “given the relatively small scale and non-core nature” of the sector. 

“We recognise the challenges in the current environment but remain fully committed to strategic clarity as we execute our objective of delivering sustainable long-term growth and value creation,” said Svensson. “Our priority is delivering results, and we look forward to providing a strategic update in connection with the Q1 Report, which will include insights into our growth strategy, financial outlook and key milestones.”