NorthStar Gaming, the Canadian operator behind the NorthStar Bets platform, has outlined a significant strategic pivot for 2026 following the release of its third-quarter financial results.
Michael Moskowitz, the company’s CEO and Chair, announced that the operator will adopt a more “disciplined approach” to player acquisition and retention. This shift comes as the company navigates a maturing business cycle within the highly competitive Ontario iGaming market.
Financially, NorthStar delivered steady growth in Q3, with revenue increasing 4% to CA$6.9 million. On a year-to-date basis, performance was even stronger, as nine-month revenue rose to CA$23.3 million.
Profitability also trended upward, gross margin grew 14% to CA$2.4 million in the quarter and climbed to CA$8.9 million over nine months. Overall, the company continues to grow, though at a more measured pace compared to its early launch phase.
The new strategy is already in motion, evidenced by a sharp reduction in marketing spend. Marketing expenses in Q3 dropped by 21% to CA$2.3 million, contributing to an 8% decline in marketing costs for the first nine months of the year. However, this austerity comes with a warning.
NorthStar Gaming revealed that its future revenue growth is heavily dependent on maintaining adequate liquidity to fund these marketing efforts. The company cautioned that, based on current forecasts, its existing cash flow and liquidity “may not be sufficient” to support aggressive growth.
Management has identified a potential risk of breaching certain debt-related covenants if financial targets are not met. Discussions with lenders have already been initiated to address these concerns proactively. While the company’s cash flow forecast through December 31, 2026, indicates it can meet obligations as they come due, the margin for error has narrowed.
A breach could force operational adjustments or necessitate seeking additional debt or equity financing. As NorthStar Bets continues to offer sports betting and online casino gaming in Ontario, the focus for the coming year will be strictly on prudent financial management and optimizing the player experience to drive organic retention.
