Profit and revenue hold steady, but Catena Media maintains cautious outlook

Catena Media, the Malta-based affiliate marketing firm, reported stable profitability in the first six months of 2025, even as revenue from continuing operations fell sharply year-on-year, prompting it to maintain a guarded view on its outlook for the remainder of the year.

In its interim report, the company said revenue from continuing operations totalled €19.4 million, down 33 per cent from €28.8 million a year earlier. North America continued to dominate performance, contributing  €17.4 million – a decline of 32 per cent – and accounting for 90 per cent of group revenue from continuing operations.

The number of new depositing customers (NDCs) generated from continuing operations fell 44 per cent to 42,147 from 75,552 in the same period last year.

On the earnings side, adjusted EBITDA from continuing operations decreased by nine per cent to  €2.3 million, corresponding to an adjusted EBITDA margin of 12 per cent, up from 9 per cent a year earlier.

EBITDA from continuing operations, however, surged 744 per cent to  €2.8 million from  €0.3 million, boosting the EBITDA margin to 15 per cent from just 1 per cent in the prior-year period.

Q2 performance

Commenting on the performance for the second quarter of the year, company Chief Executive Officer (CEO) Manuel Stan, said that Q2 had the strongest quarter-on-quarter performance in several years, driven by underlying business improvements rather than state launches or seasonal factors.

“Q2 brought signs that our stabilisation efforts are having a measurable impact,” Mr Stan said.

“Although we remain cautious in our outlook, it is encouraging to report our strongest quarter-on-quarter performance for Q2 for several years.”

Adjusted EBITDA rose sharply to €1.4 million in the quarter, with the margin improving to 14 per cent – more than double the levels recorded in both Q1 2025 and Q2 2024.

Revenue remained broadly unchanged for the third consecutive quarter, a sign of resilience in what is typically the slowest trading period of the year, according to the company CEO.

In May 2025, the group confirmed a 25 per cent workforce reduction to optimise operations and reduce costs, with Malta being the least affected location. The restructuring removed one layer of management and eliminated more than 50 roles. This measure is expected to cut annual costs by €4.5 to €5 million.

Operational changes in Q2 also included unifying the technology stack into a more scalable platform, simplifying processes across teams, and consolidating software licences. Gains from these changes will continue to materialise in the second half of the year as longer-term agreements expire.

These cost-cutting measures are expected to cut annual costs by €5.3 to €5.8 million, with the full financial impact set to be visible from Q3 onwards.

“It is encouraging to see that these actions have successfully reduced costs and improved profitability without affecting revenue generation,” Mr Stan noted.

Casino revenue edged up compared to Q1 2025 despite seasonal softness and legal constraints in the social sweepstakes segment, with growth in regulated casino markets helping maintain momentum. Sports betting revenue fell around 10 per cent quarter-on-quarter, in line with expectations given the quieter sporting calendar.

Mr Stan said the restructured sports teams are now fully operational and working within a flatter organisational model that is delivering greater speed and efficiency ahead of the busier football season in Q3.

Looking forward, the company aims to sustain the earnings momentum achieved in June – its most profitable month of the quarter – while investing in long-term growth. This includes adapting content and technology for generative AI search, strengthening CRM and loyalty capabilities, and focusing on its core brands.

Outside North America, Catena Media sharpened its strategic focus by selling its esports vertical, a move that generated cash and freed resources for its core operations. The company also redeemed its senior bond in June, leaving it in a net cash position (excluding hybrid capital securities), enabling further investment in future growth.

“As we move into the second half of the year, we will build on the progress made this quarter to improve profitability and build long-term resilience as we diversify the offering, optimise operations, further consolidate our tech stack and grow in areas where we know we can win,” Mr Stan concluded.