Unibet released its second-quarter earnings this week and one highlight of the report was the rebounding of its poker product after moving from the MPN network in favor of its own proprietary platform.
Revenues from poker soared to £1.9 million ($2.95 million), a 12 percent increase year-on-year quarterly growth.
Following the decision to develop its own software, Unibet poker revenues dropped off from $21 million in 2013 to just $13 million in 2014, a startling decrease that certainly had executives worried.
But the resurgence of activity and player accounts seems to be changing the outlook at the Malta-based gaming company as the third quarter is typically strong for Internet poker.
“The success of the marketing investments made in previous quarters has also driven organic growth,” Henrik Tjarnstrom, Unibet CEO said. “This has also resulted in all-time high in gross winnings revenue.”
The overall trend in online poker certainly seems to be targeting the social and more casual player, and a quick glance at Unibet’s software certainly confirms the company’s audience emphasis.
Unibet’s platform allows players to create avatars and aliases up to three times a day, giving less-experienced newcomers the ability to change their identity and rid an opponent’s ability to track their habits.
The graphics are quite divergent from that of PokerStars and other leading pro and advanced amateur sites, whereas a simple moniker has been replaced with outlandish cartoonish characters.
It’s all part of a concerted effort to appeal to the fun money and novice crowd. Just this week, Caesars Interactive Entertainment reported $186 million in social and mobile gaming, a nearly 30 percent increase from the same quarter last year.
The all-in investment made by Unibet in 2014, followed by the drastic decline in revenues likely had Unibet wondering if it made the right call.
Considering cash game traffic is also up 27 percent since its new platform launched in May 2014, it’s obvious it did.
Overall, Unibet appears to be performing extremely well, as second quarter gross winnings ballooned to $125.3 million, but unfortunately it hasn’t translated into a stronger bottom line.
Profits after tax crashed from $75 million in Q2 2014 to just $21 million, but there’s a clear explanation: the World Cup.
One of the most heavily bet events in all of athletics, the 2014 World Cup ran from June 12th to July 13th and provided Unibet’s sportsbook arm with an additional $56 million in wagers.
That greatly affects the ability to compare year-to-year performance of Unibet’s complete casino portfolio, but Tjarnstrom says that while daily averages for gross sports betting were understandably lower than the exceptionally high margin in 2014, revenues are actually slightly up compared to last year’s Q4, making the CEO very optimistic.
“Despite tough comparables from the successful World Cup in 2014… Strong growth in turnover across all products and our continued focus on operational efficiency has raised profitability,” Tjarnstrom concluded.
And as more and more casual gamers take to online betting, the outlook of its social poker product also appears bright.