Catena Media and its CEO Manuel Stan offered some more insight on how the company plans to reorganize and refocus following the dismissal of roughly 10% of its workforce last month.
EBITDA down 40% YoY for Catena
During the Q3 earnings call, Stan and the executive team admitted that it was a rough quarter for the affiliate group. The company posted $11.5 million in revenue compared to $17.1 million for the same period last year. Adjusted EBITDA came in at $1.4 million compared to $3.5 million last year.
“Sports remains challenging with continued underperformance in Q3,” Stan noted. Sports betting revenue was down 60% year-over-year. Moreover, Catena Media was even more reliant on North American revenues than before, with 89% of earnings coming from the continent compared to 83% last year.
Stan pointed to the lack of a new launch, unlike in 2023 when operators were launching in Kentucky. By comparison, casino revenues were down 12% YoY.
While this quarter was hampered by a lack of new state launches, Stan said the company realizes it has become too reliant on new markets and is working to avoid the problem in the future.
Stan admits affiliate was too reliant on new states
“Catena’s strategy has historically been reliant on new state launches and the regulation slowdown has had a negative impact on its performance over the last few quarters. As mentioned in the previous quarterly update, we have shifted our strategy to be less reliant on state launches and to diversify the product portfolio and revenue streams,” Stan explained. “In practice, during the quarter, we have amplified our effort to build our brands, databases and CRM capabilities to better serve and monetize our customers to position ourselves for future casino market launches by building our brands and databases in the social sweepstakes casino vertical and reach new demographics such as the Spanish-speaking segment.”
Stan noted that the company recently launched a Spanish-language version of Bonus.com and plans to deploy a Portugese version for the Brazilian market in the future.
Catena to focus on most popular brands in portfolio
In order to become less reliant on new launches, Stan said Catena would really focus on the products that draw the largest number of customers and the layoffs and reorganizations were designed to better support those products.
“We’ve done a big exercise throughout the quarter to ensure which products are the most viable for us and allocate the teams on that. And secondly, as we said, make sure that the structure of the teams, the marketing content product teams are aligned with that,” he noted.
Stan said the company is now focused on people, product and profitability as Catena’s three pillars. Moreover, the company has significantly cut down its debt. Additionally, the group terminated several of its media partnerships in the wake of a Google update that significantly changed the landscape for such deals.
Google will always be a key concern for the group, but the search engine’s impact calmed down over the past quarter.
“During Q3, we have seen higher daily volatility than usual as a result of the continuous algorithmic changes, but overall, our rankings have stayed relatively flat with a small improvement throughout the quarter,” Stan said.
While the company did layoff a large group of people, Stan doesn’t foresee another major organizational shift in the near term.
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