Codere Online’s third-quarter Spanish gains offset in Mexico

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The Backstory

Why Codere’s latest quarter matters

Codere Online’s third-quarter update showed a familiar split: solid demand in Spain and rising customer counts in Mexico, muted by currency pressure and uneven performance elsewhere. The company kept its full-year targets and emphasized momentum into the fourth quarter. That mix fits a pattern from earlier in the year and sets up the stakes for the balance of 2025 as Codere leans on growth markets while navigating macro headwinds.

The headline in the quarter was stability in net gaming revenue at €51.6 million once adjusted for currency devaluation, with Spain up and Mexico flat after a weakening peso clipped gains. Active users continued to shift toward Mexico, where the customer base is growing faster than revenue because FX and margins masked underlying demand. Management also reaffirmed guidance and extended a share buyback, signaling confidence in cash generation and the path to profitability despite regional volatility.

The backdrop: Codere is balancing a concentrated exposure to Mexico with steady expansion in Spain and smaller, choppier contributions from other Latin American markets. The quarter’s story sits atop months of similar trends.

Currency swings shaped 2024’s narrative

Codere’s second-quarter numbers previewed many of the same dynamics. Revenue dipped one percent to €51.4 million on reported terms, which the company tied to the devaluation of the Mexican peso. On a constant currency basis, growth looked healthier, and the operator narrowed its loss and improved cash flow. Mexico drove the business at €29 million, outpacing Spain’s €21.8 million, while other LatAm markets slipped. The customer mix continued to shift, with monthly active users down in Spain but up sharply in Mexico. That quarter also came with a reaffirmation of full-year guidance and a measured pace of buybacks, underlining disciplined capital priorities. For detail on that setup, see how Codere narrowed its loss and improved cash flow in the second quarter.

By the fourth quarter, management again highlighted the FX drag on reported growth while pointing to a stronger constant currency picture in Mexico and double-digit advances in Spain. Net gaming revenue rose five percent to €52.6 million, driven by a 10 percent rise in Spain and flat Mexico revenue on the headline but a 14 percent increase on a constant currency basis. Monthly active players kept rising fastest in Mexico, with Spain steady and other markets mixed. The period also included a regulatory footnote: Codere disclosed it had received a Nasdaq notice in November 2024 related to prior-year filings but secured more time in mid-February to comply. The quarter underscored that the operating thesis—grow share in Mexico and Spain while managing volatility elsewhere—remained intact. The company’s latest commentary continues that thread. Read more on the fourth-quarter cadence in Codere Online’s fourth-quarter revenue increase.

Spain’s steady climb, Mexico’s scale—and the rest

Spain has been the portfolio’s ballast. Through the year, revenue growth in the market outpaced user growth, an indication of higher monetization and stable margins. The third quarter continued that storyline with a five percent revenue increase and a modest uptick in active players. Spain’s performance contrasts with Mexico’s, where active customers have surged—up 39 percent in the latest quarter—yet reported revenue has lagged demand because of the peso and sports-betting margin swings.

The “other jurisdictions” bucket has been the swing factor. A yearlong slump in those markets weighed on the third quarter, amplifying the dependence on Spain and Mexico. That concentration raises execution risk but also clarifies where management is investing for return. The CFO transition announced alongside third-quarter results—handing the finance role to Marcus Arildsson—puts more focus on maintaining discipline around customer acquisition costs in Mexico and product-led growth in Spain while the team resets performance in smaller markets.

The capital plan helps bridge that execution. Codere has reiterated a full-year net gaming revenue range of €220 million to €230 million and cash flow of €10 million to €15 million, consistent with prior quarters. The extension of the buyback through 2026 suggests the company sees its valuation as attractive against an improving profitability profile, even as FX and competitive dynamics complicate quarter-to-quarter results.

A market growing around Codere

Codere’s results are playing out against a broader backdrop of accelerating online casino and regulated igaming activity. In Canada, Ontario posted a new high for third-quarter spending, with CA$22.7 billion wagered across the channel and online casino driving most of the increase. The province reported CA$644 million in online casino revenue in the quarter, up 37 percent year over year, while sports betting and poker were more mixed. The data underlines how stable, highly engaged casino play can offset volatility in sports betting margins and seasonality, a dynamic relevant to operators with diversified mixes like Codere. See the provincial trends in Ontario players breaking online gambling spending records.

Operator performance in North America and Latin America also points to secular tailwinds coupled with tax and regulatory crosscurrents. Rush Street Interactive reported its best third quarter, with US$277.9 million in revenue, a US$14.8 million profit and 20 percent year-over-year growth. The company highlighted accelerating user growth and strong online casino momentum across several U.S. states and Ontario. That read-through supports Codere’s emphasis on expanding product and retaining customers in maturing markets like Spain. For a snapshot of the operator’s momentum, see Rush Street Interactive’s third-quarter revenue spike.

Policy and FX risks in Latin America

At the same time, Latin America remains a study in contrasts. Demand is expanding, but taxes, foreign exchange and politics can whipsaw reported results. Rush Street’s leaders, discussing the region, noted pressure from a value-added tax in Colombia and possible tax increases in Mexico. They described a strategy of cushioning players with bonuses while waiting out policy shifts, and they flagged potential changes to Mexico’s levy. The picture mirrors Codere’s challenges: strong player growth in Mexico and profitability levers that depend on currency stability and manageable tax regimes. For more on those regional pressures, read Rush Street Interactive’s third-quarter outlook.

This context matters for Codere’s “flat in Mexico” headline. On a constant currency basis, its Mexico growth has looked much stronger, and management has repeatedly framed FX as the main headwind rather than demand. The mix also underscores why Spain’s consistency is strategic—stable regulation and predictable margins can counterbalance Latin American volatility while the company scales product and brand in its largest market.

What to watch next

Three threads will define the next phase. First, whether the fourth quarter’s strong start in Spain and Mexico can outrun FX and margin noise into a cleaner translation to reported revenue. Second, how the new CFO steers cost discipline and capital allocation, including pacing of buybacks against liquidity and growth investment needs. Third, any shifts in Latin American tax and regulatory policies, especially in Mexico and Colombia, that could alter net take rates or customer incentives across the region.

Codere’s recent quarters have told a consistent story: healthy underlying demand, currency friction in Mexico, steady gains in Spain and a drag from smaller markets. The coming periods will test whether that core engine can carry the rest of the portfolio—and how quickly reported results converge with constant currency growth as macro and policy headwinds ebb.