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Toronto-based NorthStar Gaming Holdings Inc. (TSXV: BET) (OTCQB: NSBBF) reported financial results for the three- and nine-month periods ended September 30, 2025, demonstrating continued year-over-year growth in revenue and gross margin despite ongoing market challenges.
Q3 2025 Financial Performance
The company generated revenue of $6.9 million in Q3 2025, representing a 4% increase from $6.6 million in the same quarter of 2024. The results included $0.8 million in managed services revenue, up 167% from $0.3 million in Q3 2024. Revenue growth persisted despite what the company characterized as higher than customary player-friendly outcomes during the quarter.
Gross margin reached $2.4 million, a 14% improvement from $2.1 million in Q3 2024. The gross margin percentage climbed to 34.7% of revenue, compared to 31.7% in the year-ago period, reflecting improved operational efficiency.
"We maintained our track record of year-over-year growth in both revenue and gross margin in the third quarter. We continue to strengthen the fundamentals of the business with KPIs remaining solid and ongoing innovation helping to attract and retain customers. Our team has been implementing operational improvements that are improving the player experience while at the same time reducing operating expenses."
The statement came from Michael Moskowitz, Chair and CEO of NorthStar Gaming.
NorthStar reported profit before marketing and other expenses of $0.2 million in Q3 2025, an improvement of $0.7 million compared to a loss of $0.5 million in Q3 2024. This marked the fourth consecutive quarter of positive results in this metric.
Operational Efficiency Gains
General and administrative expenses decreased 16% to $2.2 million in Q3 2025 from $2.6 million in Q3 2024, representing 31.6% of revenue compared to 39.4% in the prior year.
Marketing expenses fell 21% to $2.3 million in Q3 2025 from $2.9 million in Q3 2024, accounting for 32.6% of revenue versus 42.9% in the comparable period. The company attributed the reduction to ongoing optimization of marketing investments focused on attracting high-value players while controlling costs.
Nine-Month Results
For the nine-month period ended September 30, 2025, NorthStar reported revenue of $23.3 million, up 17% from $20.0 million in the same period of 2024. Managed services revenue totaled $1.9 million, an increase of 138% from $0.8 million in the year-ago period.
Gross margin for the nine-month period reached $8.9 million, a 32% increase from $6.8 million in 2024, with the gross margin percentage rising to 38.2% from 33.9%.
The company achieved profit before marketing and other expenses of $1.5 million for the nine-month period, an improvement of $2.2 million compared to a loss of $0.6 million in 2024.
Recent Product and Marketing Developments
NorthStar launched The Boost (www.theboostbet.ca), a content platform showcasing sports and casino content including news, insights, and scores. The platform targets a broader audience to accelerate customer acquisition in Ontario.
The company’s fall marketing campaign extended its "Exceptionally Canadian" theme with television advertisements aimed at building awareness during the seasonally active fourth quarter.
NorthStar received recognition at the Clio Sports Awards, winning a Silver Award for its "SwiftBets" campaign that encouraged Taylor Swift fans to place prop bets on her Eras Tour performances in Toronto. The company also earned a Shortlist Award for its "Debatable Billboards" campaign addressing the soccer versus football terminology debate.
The operator expanded its online tournament offerings with events including the 50 Grand Slots Showdown, the NorthStar Blackjack Championship, and free-to-play competitions such as the NFL-themed Beat the Spread Challenge and a Holiday Slots event.
Platform Enhancements
Phase One of a redesigned casino lobby went live during the quarter, delivering what the company described as a faster experience prioritizing top-performing titles. The update establishes the foundation for planned personalization features designed to increase player engagement and game discovery.
NorthStar implemented onboarding process improvements that reduced registration times by 9%, cut abandon rates by 28%, and increased completion rates by 8%.
The company continued investing in its VIP program infrastructure through additional team members, events, and incentives targeting high-value players.
2026 Outlook and Strategic Adjustments
"The third quarter of 2025 represented overall growth in NorthStar’s revenue at a time where the Company’s business is maturing and the Ontario iGaming market continues to evolve. Looking ahead to 2026, the Company has adjusted its strategy to focus on a disciplined approach to optimize player acquisition and retention where these investments align with our financial resources and market conditions. As a result, management expects more moderate top-line growth driven by continued enhancements to the player experience and by prudent allocation of marketing and operating expenses."
Moskowitz outlined the company’s strategic direction in his forward-looking statement.
Liquidity and Going Concern Disclosure
The company’s Q3 2025 financial statements include a going concern statement. NorthStar disclosed that continued revenue growth depends on maintaining adequate liquidity to support marketing and customer acquisition initiatives.
Based on current forecasts, the company’s cash flow and liquidity position may not be sufficient to fund operating expenditures, including marketing investments, and meet certain debt-related covenants with its senior lender without additional action.
Management developed a cash flow forecast through December 31, 2026, indicating the company can continue meeting obligations as they come due. However, a risk exists that NorthStar may breach certain debt-related covenants, and management has initiated discussions with the lender regarding these matters. A breach could require operational adjustments and potentially seeking additional debt or equity financing.
Financial Restatement Note
Comparative results for the three- and nine-month periods ended September 30, 2024, have been restated in the company’s financial statements to include additional merchant fees and player bonus expenses not captured in previously published financial statements.
The Q3 2025 financial statements and management’s discussion and analysis are available on SEDAR+ at http://www.sedarplus.ca and on the company’s website at http://www.northstargaming.ca.
About NorthStar Gaming
NorthStar Gaming owns and operates NorthStar Bets, a Canadian casino and sportsbook platform offering casino games and sports betting. The platform features a Sports Insights feature integrating betting guidance, statistics, and scores. As a Canadian company, NorthStar operates under responsible gaming standards and holds the necessary regulatory approvals to operate in Ontario.
Source: NorthStar Gaming
