Sportradar’s Earnings Take a Dive in Q3 Despite Revenue Growth

Sportradar’s consistent operational earnings took a significant dive, dropping by a substantial 63.8% in the third quarter, reaching a mere €4.6 million (£4 million/$4.8 million).

Sportradar’s recurring operational profit plummeted by 63.8% in the third quarter, despite a 12.4% year-over-year increase in overall recurring operational income to €201 million. All of Sportradar’s divisions saw expansion, particularly its “Rest of World (RoW)” betting AV division, which experienced revenue growth of 15.0% to €38 million.

RoW betting revenue reached €112.1 million, up 11.1%, while US revenue also expanded by 11.1% to €35 million. All other divisions saw income increase to €15.7 million.

Sportradar’s chief executive, Carsten Koerl, stated that the third-quarter results indicate the company is on course to achieve full-year growth.

“As a leading force in the industry, we are dedicated to consistently generating value for our clients, partners, and stakeholders,” he remarked. “We anticipate sustained growth in 2023 and are well-prepared for continued expansion in 2024.”

This week, Sportradar declared it would be reducing its workforce globally as part of other strategic initiatives. The company stated this would result in a 10% decrease in labor cost run rate in 2023.

This week, the company declared job cuts across its international workforce as part of a wider set of strategic plans. These plans will empower the company to further strengthen its customer-focused organization and concentrate on future market opportunities, Kohl added.

Net earnings decreased in the third quarter.
Regarding expenditures, Sportradar’s biggest expense this quarter was operational costs of €75.3 million. This was followed by €45.2 million in purchases of services and licenses, and then €38.1 million in depreciation and amortization.

Two costs were incurred this quarter that were not included in the third quarter of 2022. These were €9.8 million in impairment losses on goodwill and intangible assets and €5.6 million in impairment losses on the disposal of assets.

Considering various expenses, net profit before taxes was €10.5 million, down 27.9% year-over-year. Sportradar paid €5.9 million in income tax expense, bringing profit from continuing operations to €4.6 million. Including a €0.495 million loss from discontinued operations, the profit for the period was €4.1 million.

Adjusted EBITDA for the quarter was €50.4 million, up 38.3%.

Earnings also declined for the first nine months.
For the first nine months of the year, Sportradar’s total revenue was €625 million, up 19.3%.

Breaking down revenue by segment, for the first nine months, RoW betting revenue was €334.8 million and RoW betting AV revenue was €132.1 million. Sportradar’s US revenue was €112.7 million, and all other segments contributed €45.2 million.

The largest expense this period was personnel expenses at €237 million.

Depreciation and amortization charges were €2 million and €137.9 million, respectively.

After paying €11.5 million in taxes – nearly three times the amount from the same period last year – earnings from ongoing operations reached €11.4 million, a decline of 73.8%.

The initial nine months witnessed a more than 50% drop in pre-tax net earnings, from €47.8 million in the first nine months of 2022 to €22.9 million.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) for the first three quarters amounted to €127.2 million, a rise of 40.2%.

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