Gaming specialist Raketech has published its report for the fourth quarter of 2024, highlighting a decline in revenue. In the wake of the sale of the Tipster business in the US, the company has been focused on improving conversion rates and monetization for its digital tipster platforms.
The Financials Were Not Optimal
In Q4 2024, the company revenues reached EUR 12.3 million ($12.8 million), marking a significant decline from the strong end of 2023 when the company reported EUR 22.8 million in revenue. Adjusted EBITDA was likewise lower at EUR 3.2 million ($3.3 million), down from EUR 6 million in Q4 2023.
The revenue from the Affiliation segment stood at EUR 6.5 million ($6.8 million), down 32% YOY, while the revenue from the Sub-Affiliation division plummeted by 54% to EUR 5.2 million ($5.4 million).
Free cash flow before earnouts for the year totaled EUR 14.7 million ($15.3 million), in line with the EBITDA figures. The company said that this ensures that it can fulfill its upcoming earnout commitment of EUR 8.0 million ($8.3 million), which is due by the end of H1. It added that EUR 3 million had already been paid in January.
The remaining earnout liability of EUR 20.6 million ($21.4 million) is to be settled at any time before September 2026.
The Company Continues to Streamline Its Business
After reviewing its operating model, the company was able to achieve cost savings of 29% in Q4 2024. The company evaluated its Affiliation Marketing assets and defined its strengths, allowing it to form better agreements and growth opportunities in the future. Since the business comprises a significant part of Raketech’s revenue, the company is bullish on returning the assets to growth.
Despite that, 2024 remained a difficult year for Raketech. CEO Johan Svensson commented on the matter, saying:
Following a challenging year, we have thoroughly evaluated our Affiliation Marketing assets and their alignment with Raketech’s established commercial and operational strengths. This will enable the company to concentrate more on strategic partnerships, exclusive commercial agreements with operators and the development of AffiliationCloud.
Johan Svensson, CEO, Raketech
Raketech’s Team Hopes to Fare Better in 2025
From 2025 onward, Raketech plans to enhance the timeliness of its reporting and publish its results earlier. Speaking of 2025, the company said that the Q1 results so far are consistent with the ones reported in Q4, although the overall revenues have continued to decline due to seasonal headwinds.
The SubAffiliation business experienced a slow start in January but is picking up in February.
Svensson recognized the challenges his team is facing and reiterated his team’s commitment to “strategic clarity.” He said that Raketech looks forward to providing a strategic update in connection with the Q1 2025 report, providing further insight into the company’s financial outlook.