Following the completion of the Q2 2022 reporting season, H2 Gambling Capital has made its analysis of the performance of the market available through its recently expanded business research service. According to the tracker’s first iteration, global revenues increased by 11% year over year in Q2.
More than 65 companies in the global gaming industry, including operators, suppliers, and affiliates, have recently been added to H2’s corporate coverage, which now includes companies with annual revenues over €100 billion.
Main Takeaways from Q2 2022 Gambling Revenue Report by H2 Gambling Capital
Revenues for gaming companies have not yet surpassed pre-Covid levels in Q2 2022 and are 2.9% lower than in Q2 2019. However, they are up 5.5% from Q1 2022 and 11% from the prior year.
However, there is still a sizable performance gap between the retail and online markets, both globally and regionally.
These are the main lessons learned from the quarter:
- Online sales for Q2 were up 8% year over year and 77% over Q2 of 2019;
- Although it is up 11% year over year, Q2 retail revenue is down 21% from Q2 2019;
- Significant geographic differences: Macau continues to be the main source of difficulty for Asian land-based gaming, whereas non-Asian retail gambling is up 6% from Q2 2019 to Q3.
Online gaming sales have increased by 8% annually and 6% quarterly.
- In this, B2B revenues, which increased 17% year over year, outpaced B2C revenues, which increased 7%;
- But B2C, which increased 7% in comparison to Q1 2022, was what drove the sequential rise, while B2B shrank by 0.5%, marking the first quarterly decline since Q2 2020.
The growth of the online market is driven by new markets that open their doors every year and various incentives and promotions for players, like free spins awarded as part of the welcoming bonuses intended to provide the best experience for new players.
Not many businesses divide their B2C operations by product, but those that do include the following split:
- Sports betting increased 5% year over year and 11% quarter over quarter;
- Gaming revenue increased 10% year over year and only 2% quarter over quarter.
Growth of Earnings
The earnings before interest, tax, depreciation and amortization for the quarter are derived from a smaller number of companies than the revenues because some large companies do not report earnings on a quarterly basis. But for those that provide quarterly data:
- The quarterly performance has improved significantly, with Q2 adjusted EBITDA up 18% compared to Q1 2022, offsetting the 5% year-over-year decline;
- However, this is still 29% lower than what was reported for Q2 2019;
- Land-based EBITDA is still 35% lower than that of Q2 2019 reported;
- For this group of businesses, online EBITDA is 5% lower than what was reported in Q2 2019, but this is greatly distorted by the reporting of US-facing operators with sizable quarterly losses.
About H2 Gambling Capital
H2 Gambling Capital is a data and consulting company serving the global gaming, gambling, and lottery industries. H2 helps to change legislators’ perceptions of the industry by providing specialized consultation, market research, and in-depth data analysis. Over 500 organizations, including a number of top suppliers, financial institutions, and operators in the industry, have collaborated closely with H2.
H2 Gambling Capital, which manages consultancy and data solutions for a variety of markets within the gaming industry, is a part of The H2 Leisure Group.
