There were two topics which dominated Sportradar‘s Q1 earnings call with investors: the opportunities in predictions, and uncertainties around allegations which stunned its share price.
The Nasdaq-listed technology group was initially due to release its Q1 earnings on 6 May, but announced last week that it would be bringing the publication date to today (28 April).
Group-wide Q1 revenue came in at €346.5m (£300.3m), up 9% against €311.2m the year prior. Profitability remains a detached, with the group incurring a loss of €6m against Q1 2025 profit of €24m. Adjusted EBITDA, however, was up 12% to €66m (Q1 2025: €59m).
“Sportradar’s first quarter growth reflects our premier position as the scaled leader in the expanding global sports data ecosystem,” said Carsten Koerl, Chief Executive Officer of Sportradar.
“We continue to deepen our relationships across our expansive distribution network, providing additional content, products and services to our sportsbook, media and technology clients.”
Sportradar denies black market activity
Unsurprisingly, in its follow up earnings call to the Q1 report, Sportradar leadership found themselves re-addressing allegations made against the firm by two short sellers last week, Muddy Waters Research and Callisto Research.
The duo, which had targeted Sportradar stock, published reports accusing the Nasdaq sportstech business of working with illegal gambling operators, and made further accusations against Koerl’s personal business links.
This led to Sportradar’s stock falling 23% on 22 April, reaching a low of $11.7 on the Nasdaq – the first time it had reached that low since September 2024. It has remained broadly flat since, increasing to just under $14 yesterday, but has slipped again after today’s Q1 publication.
On the back of today’s results, shares were trading at $11.95 at 10:25am EST – down by over 14% within the first hour of the market opening.
It is yet to be seen as to whether shares will rebound on the back of these results in the same vein that they were gradually starting to after the short seller allegations last week.
“We do not work with black market operators,” Koerl reaffirmed to analysts during today’s call.
“For the grey market, we have a solid compliance structure in place, and we only work with licensed operators. The measurements we apply here are a risk assessment, and irrespective of licensing and jurisdictions, we only support businesses which have a licence.”
In response to queries from analysts, Sportradar provided an estimate of revenue volumes generated by grey market activity.
According to Koerl, the share of Sportradar’s revenue from grey markets is ‘between low-to-mid single digit numbers’, 5% at the lower end and about 12%-13% on the higher end.
Craig Felenstein, Sportradar’s Chief Financial Officer, went on to explain that Betting Technology and Solutions and Managed Betting Services account for around 78% of its business, while Sports Content, Technology and Services is just over 20%.
During Q1, Betting Technology and Solutions revenue rose 15% from €250m to €287.6m. Revenue from Sports Content, Technology and Services was down 4% from €61.2m to €59.9m. The firm’s business can be broadly divided into two parts – betting-related activity on one side, and sports and media activity on the other.
Felenstein explained to analysts that odds services, which are housed within the Betting and Gaming Content segment, and Managed Trading Services (MTS) – which falls under the Managed Betting Services segment – are the two areas that are most exposed to the grey market.
“When you think about the pieces I just laid out which are exposed to potential grey markets, you’re really talking about the data and odds business and the MTS business, and when you add those together you’re talking about somewhere in the mid 40% of our revenues,” Felenstein continued.
“When you talk about that 40%, you need to exclude the US revenues that are generated, and when you do that the potential exposure gets reduced to the mid-30% range.
“On top of that you’ve got some large global providers in there and applying what I’d say are public estimates of what grey markets are, you can see the math brings you back to that low-mid single digit exposure with regards to grey markets overall.”
Short seller allegations continue to rock Sportradar
Sportradar faced a number of other questions about last week’s allegations, and the firm’s leadership remained adamant each time that it maintains no business links to the black market while criticising the short sellers’ claims as ‘unfounded’.
One particular allegation addressed by Koerl was regarding the short sellers’ attendance at ICE, where they claimed to have met a Sportradar sales representative at the company’s stand who offered to sell them betting solutions for illegal markets in Asia.
The conversation between the short sellers and a ‘relatively young sales guy’ who was ‘teased into it’ by the short sellers was ‘far off from signing a contract’, Koerl remarked.
He also dismissed allegations that a majority of Sportradar’s revenue comes from trading on lower league sports, generally accepted as being at risk of match-fixing and integrity violations than top tier divisions.
“It is no way that the majority of our revenues and profits are tied to this. It’s a purely unfounded allegation,” he said.
Sportradar’s predictions promise
Allegations aside, Q1 was a positive one for Sportradar from a revenue perspective. The company expects to close the year with growth of between 23%-25% on a constant currency basis.
This would see the firm close 2026 with revenue between €1.56bn-€1.58bn. Adjusted EBITDA is expected to grow between 34%-37% to reach €290m-400m.
Throughout the remainder of the year, two things can be expected to factor heavily in Sportradar’s operations: the new iGaming-focused PlayRadar division, its ambitions in the burgeoning predictions space, and the integration of IMG Arena.
“Our recently acquired portfolio of IMG content has further bolstered our diverse offering and is resonating with customers worldwide while also expanding our margins as we increasingly leverage our existing infrastructure,” Koerl commented on the latter.
Leadership shared that the group will begin to see revenue come in from predictions in the second half of the year. Sportradar sees opportunities in both advertising and in sports betting data.
Felenstein added that any short term announcements in predictions, which the firm hinted are on the horizon, is included in current forecasts, while Koerl shared that the company is engaged in ‘intense’ talks around predictions with potential clients.
“We think that discussions are in a very mature stage,” he said. “There is nothing to announce now, but we are confident we can announce something soon.”