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Golden Matrix Group, Inc. (GMGI)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue was $42.7M, up 72% YoY; consolidated gross profit was $24.2M (≈57% margin), while adjusted EBITDA declined 5% to $5.6M due to deliberate growth investments .
  • The quarter posted a small net loss of ~$0.26M versus $3.95M net income in Q1 2024, driven by higher amortization (+$1.7M), interest expense (+$1.5M), and stock-based compensation (+$1.0M) .
  • FY 2025 revenue guidance was introduced at $190–$195M (+26–29% YoY), and Q1 results were in line with prior guidance of $42–$45M; catalysts include Brazil license, Nigeria B2B launch, and platform migration to Atlas .
  • Strategic balance sheet actions eliminated ~$9.6M in Lind Global debt and converted >$9.5M of acquisition-related debt to equity, improving net leverage (<1.6x; pro forma just over 1.2x) .

What Went Well and What Went Wrong

What Went Well

  • Record raffle performance with all-time highs in revenue, ticket sales, and prize values; 26,000 new registrations (+146% YoY). CEO: “Our raffle segment reached all-time highs…” .
  • Meridianbet momentum: permanent online betting license in Brazil through 2029; B2B operations launched in Nigeria; user KPIs strong (first-time deposits +56%, registrations +22%, deposits +12%, active users +7%) .
  • Platform execution: full migration to Atlas (5th-gen), optimizing operational efficiency and scalability; CFO cites economies of scale and improved user experience .

What Went Wrong

  • Profitability headwinds: net loss vs prior-year profit due to higher amortization (+$1.7M), interest expense (+$1.5M), and SBC (+$1.0M) .
  • Margin mix: consolidated gross margin ~57%, down from prior-year mix, reflecting aggregation of lower-margin GMAG/RKings/CFAC segments (29%) vs Meridianbet (72%) .
  • OpEx increased $10.3M to $24.3M, including Brazilian launch costs, promotions/sponsorships, Serbian wage/tax increases, and Atlas depreciation; FX was a ~4% headwind to reported growth .

Financial Results

Core P&L trends (prior two quarters vs current)

MetricQ3 2024Q4 2024Q1 2025
Revenue ($)$40,992,329 $46,000,000 $42,723,053
Gross Profit ($)$22,403,167 $27,000,000 $24,195,961
Net Income (Loss) ($)$(3,295,629) $(2,078,868) $(258,217)
Adjusted EBITDA ($)$4,336,884 $6,539,645 $5,612,300

EPS

MetricQ3 2024Q1 2025
Diluted EPS ($)$(0.03) $0.00

Margins

MetricQ1 2025
Consolidated Gross Margin (%)~57%

Segment margins

SegmentQ1 2025 Gross Margin (%)
Meridianbet72%
GMAG + RKings/CFAC (combined)29%

KPIs

KPIQ1 2025
First-time deposits (YoY)+56%
New registrations (YoY)+22%
Total deposits (YoY)+12%
Active users (YoY)+7%
Raffle new registrations26,000 (+146% YoY)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueQ1 2025$42–$45M Actual: $42.7M Met/in line
RevenueFY 2025N/A$190–$195M (+26–29% YoY) New

Notes: Management also highlighted improving net leverage (<1.6x; pro forma just over 1.2x after debt actions) as part of the outlook context .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024)Previous Mentions (Q4 2024)Current Period (Q1 2025)Trend
AI/technology initiatives (Atlas, recommenders)GMAG wagering volume +84%; platform upgrades; AI-driven tools noted Full transition to Atlas; AI Casino/Bet Recommenders increased engagement/interaction Atlas migration complete; scale/efficiency improvements reiterated Strengthening execution
Regulatory/licensing–Preparing new market entries; expansion into high-value jurisdictions Brazil permanent online betting license through 2029; Nigeria B2B launch Expanding footprint
Regional trends/macro–Cash $30M; net leverage ~1.8x; Latin America (Mexplay) growth Serbia wage/tax increases; FX headwind ~4% to growth Mixed: cost pressure offset by growth
Product/content performanceGMAG, Classics for a Cause, Mexplay growth; Meridianbet KPIs solid Expanse Studios: 174% revenue growth; 55 proprietary games by YE Raffle record results; Expanse 5 new U.S. integrations; crash titles expanding Positive momentum
Capital structure/debt–Strong liquidity; net leverage ~1.8x ~$9.6M debt repaid; >$9.5M debt converted; net leverage <1.6x (pro forma ~1.2x) Improving leverage

Management Commentary

  • CEO (Golden Matrix): “We entered fiscal 2025 with elevated operating efficiency and diversified revenue streams that continue to scale across high-growth markets. Our raffle segment reached all-time highs… our debt profile strengthened meaningfully” .
  • CFO: “We’re executing on disciplined capital allocation… improving net leverage, healthy free cash flow, and scalable platform position us to accelerate growth across 2025 and beyond” .
  • CEO (Meridianbet): “Focused execution across regulated markets… deepening user engagement, expanding licensing coverage, and strengthening our position as a global operator of choice” .
  • CFO detail: Q1 OpEx growth tied to Brazil startup costs, promotions/sponsorships, Serbian wage/tax increases, and Atlas depreciation; FX headwind ~4% .

Q&A Highlights

  • The published Q1 2025 transcript does not include a formal Q&A segment; management reiterated FY 2025 revenue guidance ($190–$195M), platform scaling on Atlas, and geographic expansion priorities .

Estimates Context

  • S&P Global consensus for Q1 2025 EPS and revenue was unavailable for GMGI at the time of this review. Results comparison to Street estimates cannot be provided.
  • Implication: With no consensus available, updates to analyst models will likely anchor to management’s FY 2025 revenue guidance and segment margin commentary .

Key Takeaways for Investors

  • Revenue growth is robust, but profitability compressed as the company invested in Brazil launch, promotions, and platform depreciation; expect operating leverage later in 2025 as Atlas scaling benefits flow through .
  • Balance sheet actions materially de-risked the capital structure (debt repayment/conversion), lowering net leverage and improving flexibility for growth investments .
  • Regulatory wins (Brazil) and Nigeria B2B entry expand TAM and should support medium-term top-line and user metrics; early execution looks strong .
  • Segment mix matters: Meridianbet’s 72% gross margin is offset by GMAG/RKings/CFAC at 29%; watch margin trajectory and mix shifts quarter to quarter .
  • Q1 tracked prior guidance ($42–$45M achieved $42.7M); FY 2025 guide $190–$195M is the key anchor for models and near-term stock narrative .
  • Non-GAAP adjustments (amortization, interest, SBC) explain the GAAP-to-adjusted delta; focus on adjusted EBITDA trends vs growth investments to gauge timing of margin recovery .
  • FX remains a modest headwind; regional cost inflation (Serbia) and promotional intensity are variables to monitor for near-term margins .