Better Collective, a superaffiliate, will cut back on its major investment in the US market because of worries about the economy. The company wants to be "prudent" and "pragmatic" when it comes to spending.

 In Better Collective's release of its third-quarter results, CFO Fleming Pedersen stated it was hard to see how macroeconomic conditions hurt the affiliate's business.

 He remarked, "The general business cycle still hasn't had a noticeable effect on our business, but it's almost impossible to say if we could have grown even faster."  "Sports betting is still at an all-time high, and we can keep on top of any changes thanks to our ongoing work and quick business insights. 

 He added that Better Collective would slow down its investment in the US to take a "prudent" and "pragmatic" approach to costs, but he also said that there could be an impact in the future.  The company had already spent a lot of money on expanding in the US by buying companies like The Action Network and RotoGrinders.

 "We intend to be strong but not immune to the current macroeconomic uncertainties, therefore we will take this time to look more closely at our whole cost base. 

 Because of this, we think that the increase of the cost base will slow down in the future, notably in the US.  In the last few years, we've put more money into US investments.  In the future, the focus will be on scalability, which will be helped by a realistic cost focus and our operational leverage as we keep growing.

 Better Collective's Q3 statistics showed that sales rose 31.4% to €59.7 million.

 The Europe and rest-of-world section, which includes everything outside of the US, was responsible for most of the rise. Operations in this area brought in €42.9 million, up from €31.0 million the year before.

 In the US, on the other hand, sales rose by 16.7% to €16.8 million.

 The increase in the US revenue share
 Better Collective's biggest source of income was revenue-share deals, which brought in €25.0 million, a 73.6% increase from the previous year.

 CEO of Better Collective  Jesper Søgaard 
 Jesper Søgaard is the CEO of Better Collective.
 On the other side, cost-per-acquisition transactions stayed the same, bringing in €23.4 million, which is virtually precisely the same amount as the year before.

 Revenue from subscriptions rose to €4.0 million, while revenue from other sources rose by 72.1% to €7.4 million.

 Jesper Søgaard, the company's CEO, noted that the rise of US revenue share has already proven many people wrong.

 He remarked, "The ongoing move from CPA to revenue share in the US looks very promising."  "Last year, not many people thought it was possible to work on revenue share in the US.

 "I think the change we're going through in the US is like how tech businesses went from licensing to running a Software-as-a-Service (SaaS) model.  We at Better Collective have always preferred revenue share agreements since we constantly invest for the long term.  This also means that our products are already made to work with these kinds of agreements.

 Søgaard added that the change hurt Better Collective's bottom line in Q3 since revenue-share deals take longer to pay out than the upfront cost-per-acquisition model.

 He said, "The move to revenue share last quarter was thought to have an effect on US profits of more than €5 million for the whole year."  "As contract closings have continued in Q3, we now think that the full-year impact will be more than €10 million."  These deals will change Better Collective for the better because they will guarantee more steady future income and improve our connection with the sportsbooks.  I'm quite interested to see how this turns out, and I'm also happy that we can still meet our short-term goals.

 Better Collective's costs go up swiftly
 But costs went up faster than income.  The company spent €21.7 million on direct revenue costs, which is a 39.1% increase, and €17.3 million on labour costs, which is a 46.6% increase.  The cost of depreciation went increased to €623,000, while other outside costs went up by 44.7% to €6.1 million.

 Better Collective noted that the higher costs were due to the addition of the FIFA Ultimate Team brand Futbin, more money spent on paid promotion to get more visitors, and more media relationships.

 Better Collective said that its operating profit before depreciation and exceptional items was €13.9 million, which represents a 6.1% increase.

 Better Collective had an operational profit before special items of €10.3 million, down 8.0% from the previous year, after €3.7 million in amortisation and impairment.

 The company had to pay €621,000 in special costs, but in the third quarter of 2021, these expenditures rose to €11.6m.  These costs were mostly attributable to the earn-out charges that came with buying the Action Network.

 Because of this, the company achieved a €9.6 million operating profit, up from a €362,000 operating deficit the year before.

 Better Collective had a profit of €6.9 million after taxes and other costs. This is a big difference from the €3.5 million loss it had in the third quarter of 2021.