DoubleDown Interactive (NASDAQ:DDI) reported higher first-quarter revenue and profit, with management pointing to growth from acquired businesses, a larger direct-to-consumer revenue mix in social casino and continued cash generation across the company.
For the quarter ended March 31, 2026, the company reported consolidated revenue of $94.1 million, up nearly 13% from $83.5 million in the prior-year quarter. Adjusted EBITDA rose 24% year over year to $38.2 million, compared with $30.8 million a year earlier. Adjusted EBITDA margin was 40.6%, up from 36.9% in the first quarter of 2025, but below 42.4% in the fourth quarter of 2025.
CEO In Keuk Kim said the quarter represented “a solid start to 2026,” citing the highest quarterly revenue at SuprNation since DoubleDown acquired the business in 2023, continued growth in direct-to-consumer social casino revenue and “another quarter of delivering consistent profitability and significant free cash flow.”
Social Casino Remains Core Profit Driver
DoubleDown’s social casino segment generated revenue of $76.9 million in the first quarter, up 9.5% year over year. Kim said the increase was driven by the contribution from WHOW Games, which DoubleDown acquired in the third quarter of 2025.
Management emphasized that social casino remains the company’s primary source of profit and cash flow, even as the broader global social casino market is estimated to be in secular decline. Kim said DoubleDown’s priorities in the segment include product development focused on player and payer retention, marketing and live operations to maximize payer conversion and purchasing activity, and further expansion of direct-to-consumer purchases.
The company said direct-to-consumer revenue accounted for 44% of total social casino revenue in the first quarter, up from 33% in the fourth quarter of 2025. Kim said the direct-to-consumer portion of DoubleDown Casino revenue exceeded 40% during the quarter, reflecting acceleration in the company’s transition away from platform-based purchases.
CFO Joseph Sigrist said WHOW Games has historically had a larger direct-to-consumer component because of its web-based history. He said the sequential increase in total social casino direct-to-consumer mix was “primarily based on the growth of DTC in DoubleDown Casino,” adding that it is difficult to predict how much further the mix can rise.
KPIs Reflect WHOW Games Mix
Sigrist said social casino key performance indicators were affected by the inclusion of WHOW Games, whose business has a higher payer conversion rate and lower average monthly revenue per payer than DoubleDown Casino.
- Payer conversion rate increased to 9.7% in the first quarter of 2026 from 6.9% in the first quarter of 2025.
- Average revenue per daily active user rose to $1.34 from $1.29 a year earlier.
- Average monthly revenue per payer declined to $207 from $276 in the prior-year period.
Sigrist said the company saw an opportunity during the quarter to increase advertising investment in DoubleDown Casino based on positive return-on-investment trends. He said customer acquisition costs improved from the fourth quarter, while newly acquired player cohorts showed the ability to monetize.
SuprNation Revenue Hits Post-Acquisition High
DoubleDown’s iGaming segment, SuprNation, reported first-quarter revenue of $17.2 million, up 30% year over year and 6% from the fourth quarter of 2025. Kim said the recent launch of the Las Vegas iGaming brand contributed to the strong results, and the company plans to continue acquiring new players through marketing and advertising investments.
Sigrist said SuprNation had a “very strong quarter” and reached breakeven while turning “a bit of a profit” before the impact of a higher U.K. gambling tax rate, which began April 1. He said DoubleDown remains focused on making the iGaming business profitable and growing profit over time.
Kim said the company is working to offset the higher U.K. tax rate through product adjustments, including reducing bonusing rates, and said early results have been positive. He also said SuprNation is using real-time data analytics to optimize user acquisition costs and retention while navigating regulatory and tax changes.
Cash Flow and Balance Sheet Strengthen
Operating expenses were $58.7 million in the first quarter, compared with $53.9 million a year earlier, primarily due to the addition of WHOW Games expenses. Sales and marketing expenses rose to $17.4 million from $14.1 million, reflecting the inclusion of WHOW Games and additional investment in SuprNation’s new brand and DoubleDown Casino advertising.
Profit excluding non-controlling interest increased 48% to $35.4 million, or $14.28 per fully diluted common share and $0.71 per American depositary share. That compared with $23.8 million, or $9.62 per fully diluted common share and $0.48 per ADS, in the first quarter of 2025. Sigrist said the increase reflected higher revenue and a higher unrealized gain on foreign currency, partly offset by higher operating expenses.
Net cash provided by operating activities was $46.4 million, up from $41.1 million a year earlier. Sigrist said the increase was driven by higher profit and lower income taxes paid. As of March 31, DoubleDown had $533.4 million in cash equivalents and short-term investments, with a net cash position of about $500 million, or approximately $10.10 per ADS.
Management Says M&A Remains a Priority
Kim said mergers and acquisitions remain a strategic priority as DoubleDown evaluates opportunities in online gaming and mobile entertainment. Sigrist said the company is continuing to analyze potential deals and that management is operating “business as usual” while a special committee reviews a proposal referenced by analysts during the call.
Asked about that proposal, Sigrist said DoubleDown’s board formed a special committee of independent, disinterested directors after receiving it. He said the committee’s objective is to review, evaluate and determine next steps in the interests of the company and its unaffiliated shareholders, but he declined to provide further details on timing or process.
On the broader acquisition environment, Sigrist said deals are still available and valuation expectations have declined, which he said is positive for DoubleDown as a buyer. He noted that some available opportunities are smaller and said the company would expect its next transaction to be a “step up” from prior deals, while continuing to apply a disciplined approach.
About DoubleDown Interactive (NASDAQ:DDI)
DoubleDown Interactive (NASDAQ: DDI) is a digital entertainment company that specializes in the development and publishing of social casino games. The company's portfolio centers around free-to-play titles that emulate the experience of land-based casino games such as slots, video poker, bingo and table games. By blending high-quality graphics, engaging gameplay features and real-time social mechanics, DoubleDown Interactive aims to deliver a virtual casino environment accessible via web, mobile and social media platforms.
The company's flagship offering, DoubleDown Casino, serves as a hub for multiple slot and table-style games, enabling millions of registered players to compete in tournaments, unlock new machines and purchase virtual coins through in-app transactions.
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