Sportradar Shares Drop 22.6% Amid CEO’s Grey Market Revenue Disclosure (5-13%)

(AsiaGameHub) –   During its first-quarter earnings call, Sportradar responded to allegations from short sellers regarding its revenue from unlicensed operators, following two critical reports that caused a significant drop in its share price last week.

Good to Know

• Sportradar stated that its revenue from the grey market falls within a range of 5% to 13%.
• The company’s stock declined by 22.6% after reports were published by Callisto Research and Muddy Waters.
• First-quarter revenue increased by 11% to €347 million, despite the company reporting a loss of €6 million.

Koerl Pushes Back On Short Seller Claims

CEO Carsten Koerl provided analysts with a more precise figure after Callisto Research and Muddy Waters raised questions about the portion of Sportradar’s income derived from unlicensed operators.

“We do not work with black market operators,” Koerl stated on the post-Q1 earnings call. “For the grey market, we have a solid compliance structure in place, and we only work with licensed operators.

“Overall, it’s [between] 5% to 12%, 13%. That’s the range which we have, and we are drilling this down from our operational business.”

Callisto Research had alleged that a former senior employee at Sportradar estimated revenue from unlicensed operators was 30% to 40%. The report also suggested the number of unlicensed platforms could exceed 270. Separately, Muddy Waters claimed that a Sportradar sales employee stated the company “serves everyone” during the ICE Barcelona 2026 event, where investigators said they inquired about operations in Vietnam, Thailand, Indonesia, and China.

Sportradar’s share price dropped 22.6% by the market close on Wednesday following the reports. Koerl refuted the allegations on LinkedIn the following day, labeling them “false, misleading and defamatory.”

He reiterated this stance during the earnings call.

“To be clear, Sportradar and I reject the unfounded and misinformed allegations contained in the reports,” Koerl said. “For 25 years, Sportradar has maintained regulatory licenses in jurisdictions around the world.

“Unfortunately, these actors strive on misinformation and repackaging historical allegations to drive down company stock prices at the expense of long-term focused investors.”

Koerl said that since the reports were released, the company had been contacted by leagues, clients, partners, commissioners, and regulators.

“I get a lot of support from all sites, our partners, our clients, the industry, some commissioners. And from a regulator perspective, we are in contact with some regulators on a very frequent basis.

“Some of them contacted our teams, they explained to them the situation and that’s an ongoing process. Overall, the response was overwhelming for me that I got so much support and feedback on the allegations.”

ICE Claims And Q1 Numbers Add More Detail

Koerl also responded to a Muddy Waters claim concerning Yabo Group, which the report identified as China’s largest illegal operator. He explained that investigators singled out a junior sales employee at the ICE event, where Sportradar conducted approximately 4,000 meetings.

He emphasized that any sales conversation is merely the start of a comprehensive review process.

“When a sales guy is selling something, there is a kickoff of a very intensive KYC process,” Koerl said. “That has the identification, the verification, the licence verification against the regulator, the verification of a corporate filing and the register, which is in there. Then finally, running this through sanction lists from all the available markets where we are acting. And then it goes to a final review of our legal counsel before a contract is signed.

“So this is far off from signing a contract, and this was a purposeful sting campaign on a relatively young sales employee at ICE.

“[There’s] no excuse on this, [it] should not happen, but this was far off from signing a contract or teasing somebody into doing business in illegal markets.”

Separate from the controversy, Sportradar announced an 11% increase in Q1 revenue to €347 million. Adjusted EBITDA grew by 12% to €66 million, while the company registered a €6 million loss.

Sportradar also appointed Sameer Deen as Chief Operating Officer, effective from May 18. Deen joins from Entain, where he held the positions of group COO and president since December 2023. Koerl stated that Deen will be “instrumental” in commercial activities and enhancing operational efficiency.

Koerl said:

“We will continue to drive innovation across our business, uphold the highest levels of integrity and transparency while delivering increasing value to our clients, our partners and our shareholders.

“The underlying fundamentals of the business remain strong, and we are confident in our growth strategy and the opportunities ahead.”