ZEAL Reports 76% EBITDA Surge Amid Strong 2025 Growth

ZEAL Network SE, a prominent licensed operator of online lottery and gaming services in Germany, has announced robust financial and operational results for the first six months of 2025. Despite a relatively subdued jackpot environment and increased acquisition costs, the company delivered impressive gains across all major performance indicators, underscoring the resilience and scalability of its business model.

This period marked not only robust revenue and profit growth but also a continuation of ZEAL’s strategic expansion, customer base development, and platform enhancement efforts. The company reiterated its confidence in long-term growth prospects, highlighting both internal operational excellence and the sector’s expanding digital penetration.

Revenue and profitability growth despite softer jackpot conditions

ZEAL recorded a year-over-year revenue growth of 32%, generating €101.5 million in the first half of 2025, up from €76.8 million during the same period in 2024. This performance was largely driven by the solid growth in its core lottery business and the continued development of its digital games segment.

EBITDA rose even more significantly, increasing by 76% to €35.4 million, up from €20.1 million in the previous year. The substantial profitability growth illustrates the strength of the company’s operational efficiencies and business model scalability, despite a market environment less favorable to new customer conversion due to lower average jackpots in major lotteries such as LOTTO 6aus49 and Eurojackpot.

Executive commentary: ZEAL’s leadership expresses confidence in future outlook

Helmut Becker, Chief Executive Officer of ZEAL Network SE, praised the company’s performance and emphasized the soundness of its business approach:

“We once again achieved strong results in the first half of 2025. ZEAL’s continued growth path proves that our business model is highly robust and scalable over the long term. We are in an excellent position to further expand our market leadership in a growing industry.”

Chief Financial Officer Andrea Behrendt highlighted the team’s collective efforts in achieving such results:

“Our half-year results are a true team success – especially given that the jackpot situation was rather weak compared to the previous year. Challenging market conditions particularly underscore our operational excellence. The significant increases in revenue and EBITDA were driven by further expansion of our customer base and profitability.”

Lottery operations remain the primary revenue driver

The company’s lottery operations once again demonstrated their strategic value and central role in ZEAL’s overall business structure. Lottery billings rose by 4% to €527.3 million in H1 2025, compared to €507.1 million in the same period last year. This growth came despite relatively low average jackpot levels, a factor that typically correlates with new user engagement and ticket volumes.

One of the key contributors to this result was ZEAL’s continued marketing success and digital product refinement, which helped attract and retain customers. The monthly average of active lottery users rose by 12%, climbing to 1.515 million compared to 1.353 million in the first half of 2024.

Further reinforcing the profitability of its lottery operations, ZEAL reported a gross margin improvement of 3.8 percentage points year-on-year, rising from 13.4% to 17.3%. This was largely due to changes in pricing structures introduced in 2024 and a favorable shift in product mix.

As a result, revenue from the lottery segment alone increased by 34%, reaching €91.0 million compared to €68.0 million in the same period last year.

Expansion of games segment enhances diversification

Beyond lottery services, ZEAL has been steadily expanding its presence in the digital games segment—a strategic move to diversify revenue streams and align with evolving consumer preferences.

In the first six months of 2025, the company grew its B2C gaming library to include more than 480 individual titles. This content enrichment translated into a 49% year-on-year increase in revenue from the games segment, which rose to €6.7 million from €4.5 million in H1 2024.

The games business continues to be a secondary revenue driver but plays an important role in providing customers with a broader entertainment offering and increasing user retention across the ZEAL ecosystem.

Strategic marketing investment amid rising acquisition costs

The first half of the year presented a mixed environment for customer acquisition. ZEAL secured 499,000 new customers during this period—a decline from the 592,000 customers acquired in H1 2024. This reduction was anticipated given the relatively low jackpot levels, which tend to serve as a catalyst for customer growth in the lottery sector.

Due to challenging market dynamics and heightened competitive pressure, the cost per lead (CPL) rose by 41%, climbing to €46.93 from €33.20 in the same period last year. ZEAL, however, maintained its marketing spend as a long-term investment, with total marketing costs rising by 14% to €29.1 million (from €25.5 million in H1 2024).

The company's consistent marketing investment reflects a strategy focused on sustainable customer base expansion and market share consolidation rather than short-term cost efficiency alone.

Operating expenses increase alongside platform and product development

Operating expenses for the first half of 2025 increased by 15%, totaling €49.4 million, compared to €42.8 million during the same period in 2024. This increase was attributed to both direct and indirect costs.

Direct operating costs, related to platform operations and service delivery, increased by 14% to €9.8 million. Indirect operating costs rose by 20% to €10.4 million, with the primary contributors being external consultancy fees, freelance personnel, and software licensing expenditures.

These cost increases are in line with ZEAL’s ongoing efforts to strengthen its technical infrastructure and broaden its product offering. Investments in digital transformation, customer experience, and cybersecurity are expected to yield further efficiencies in the medium to long term.

EBIT nearly doubles as operating leverage improves

With increased revenues and improved gross margins outpacing the rise in costs, ZEAL saw substantial growth in both EBITDA and EBIT. EBITDA surged by 76%, reaching €35.4 million, while EBIT nearly doubled to €31.1 million, up from €16.1 million in the first half of 2024.

The significant uplift in these figures highlights the benefits of operating leverage within ZEAL’s business model and affirms the effectiveness of management's strategic priorities.

Outlook for 2025 remains strong and unchanged

Based on the strength of its H1 results, ZEAL Network SE has reaffirmed the guidance and financial forecast published on March 26, 2025. While acknowledging market volatility and ongoing competitive pressures, the company remains confident in achieving its full-year targets through continued innovation, platform enhancement, and customer engagement strategies.

ZEAL’s ongoing investment in marketing, content expansion, and product development—backed by disciplined financial management—is positioned to support its ambitions to solidify its market leadership in Germany and explore additional regulated opportunities in adjacent markets.

Conclusion

Despite operating in a cyclical and jackpot-sensitive environment, ZEAL has demonstrated that disciplined execution, operational excellence, and consistent investment in core capabilities can yield significant returns. The company’s half-year 2025 results signal a continuation of its upward trajectory, even under less-than-ideal external conditions.

With an expanding customer base, improving margins, and a firm grasp of digital innovation, ZEAL Network SE is well-placed to pursue its long-term strategic vision while maintaining a strong financial foundation.

FAQs

What is ZEAL Network SE?
ZEAL Network SE is Germany’s leading online provider of lottery and digital gaming products, operating under a regulated framework.

How much revenue did ZEAL earn in H1 2025?
ZEAL reported €101.5 million in revenue for the first half of 2025, marking a 32% increase from the same period in 2024.

What contributed to ZEAL's EBITDA growth?
The 76% increase in EBITDA was driven by improved gross margins, increased customer base, and efficiency gains in operations.

How many new customers did ZEAL acquire in H1 2025?
ZEAL acquired 499,000 new customers during the first six months of 2025.

Why did ZEAL’s marketing costs increase?
Marketing costs rose due to intensified customer acquisition efforts amid challenging jackpot conditions, which increased the cost per lead.

What caused the gross margin improvement?
ZEAL's gross margin improved due to pricing adjustments introduced in 2024 and a favorable product mix shift.

How did the games segment perform?
The games segment grew by 49% in revenue, reaching €6.7 million, supported by portfolio expansion to over 480 titles.

What are ZEAL’s expectations for the rest of 2025?
ZEAL has reaffirmed its 2025 forecast, confident in sustained growth through continued investment in technology, marketing, and product development.

What risks did ZEAL face in H1 2025?
The main risks were related to lower average jackpots, which typically reduce new user conversion and engagement rates.

What measures did ZEAL take to manage rising costs?
ZEAL managed rising operating costs through strategic investments in efficiency, technology, and third-party services to support its long-term goals.