iGaming KPIs Explained: GGR, NGR, Hold, FTDs, LTV and the Rest

Every conversation in the industry, from a trading floor to a board meeting to an earnings call, is conducted in a vocabulary of acronyms that nobody defines because everyone is assumed to know them. This guide defines them, shows how they connect, gives the ranges that are normal, and explains how operators and analysts use and misuse them. It is the reference for anyone joining the industry, reporting on it, or trying to read a listed operator's results.

The revenue chain

Everything starts with the stake and ends with the profit, and each step has a name.

Handle (turnover, stakes, amounts wagered). The total amount bet. In sports betting, handle is the headline figure in American state reports; in casino, turnover is rarely reported because the same money is recycled many times in a session. Handle is a volume measure, not a revenue measure, and the industry's most misleading number when quoted alone.

Gross gaming revenue (GGR, gross win). Stakes less winnings paid to customers. The operator's gross revenue before any deductions, and the base for gaming tax in most jurisdictions. For sports, GGR divided by handle is the hold or win margin; for casino, GGR is the house edge applied to turnover.

Net gaming revenue (NGR). GGR less the deductions the operator's definition specifies: bonuses and promotional costs, gaming taxes and duties, payment processing costs, chargebacks, and sometimes platform fees and jackpot contributions. NGR is the figure operators manage to, the base for most affiliate revenue shares and B2B supplier fees, and the figure whose definition matters most in any contract. There is no standard definition; every operator's is slightly different, and comparing NGR across companies requires reading the footnotes.

Revenue (reported). What appears in the accounts. Under most accounting standards, revenue is GGR less bonuses and certain promotional costs, with gaming tax treated as a cost below the line in some presentations and above it in others. Listed operators report on different bases, and "revenue" in one company's results is not the same line as in another's.

Contribution. Revenue less the direct costs of generating it: gaming tax, platform and content fees, payment costs, and marketing. The measure of a market's or a brand's underlying profitability.

EBITDA. Earnings before interest, tax, depreciation and amortisation; the industry's standard profitability measure and the basis on which companies are valued. Adjusted EBITDA, which adds back items the company deems non-recurring, is the figure in the headlines and the one to read with care.

Margin measures

Hold (sports). GGR as a percentage of handle. Structural hold, the margin implied by the prices, runs around 4 to 6 per cent on match markets and much higher on parlays; actual hold in a period depends on results and swings with them. Operators report expected versus actual hold to explain results, and a quarter with favourable or unfavourable sports results moves hold by percentage points. American operators' hold has risen steadily as parlay and same-game-parlay volumes have grown, from around 6 per cent in the early years of the market toward 10 per cent and above for the leaders.

House edge and RTP (casino). The share of each stake the game retains on average (house edge) and its complement (return to player). Blended casino margin across a lobby is typically 3 to 5 per cent of turnover, driven by the game mix. The RTP, House Edge and Margin guide covers the arithmetic.

Bonus ratio (promotional intensity). Bonus cost as a percentage of GGR. Typically 15 to 30 per cent for online casino in competitive markets, 10 to 25 per cent for sports, rising during launches and promotional wars and falling as a market matures or a regulator restricts bonuses. A rising bonus ratio with flat NGR means the operator is buying revenue.

Payment cost ratio. Payment processing as a percentage of deposits or of GGR; higher for gambling than for ordinary e-commerce, and a lever operators work on constantly.

Gaming tax rate. Tax as a percentage of GGR, set by the jurisdiction. The Gambling Tax Rates by Country guide gives the rates.

Customer measures

Registrations. Accounts opened. A vanity metric on its own, because many never deposit.

First-time depositors (FTDs, new depositing customers, NDCs). Customers who made their first deposit in the period. The acquisition number that matters, the basis on which affiliates are paid CPA, and the denominator for acquisition cost.

Actives (monthly active players, MAPs, average monthly players, AMPs). Customers who placed a bet or played in the period. Listed operators report actives as their headline customer number; definitions differ (some count any activity, some real-money play only, some exclude customers with only bonus play), and a company that changes its definition changes its trend.

Average revenue per user (ARPU, ARPPU). Revenue (usually NGR) divided by actives, per month or per period. The value side of the customer equation. ARPU varies enormously by product (casino higher than sports), by market (regulated Europe higher than Latin America) and by segment (VIPs dominate). Falling ARPU with rising actives can be healthy (broadening the base) or unhealthy (regulation restricting high-value play); the mix explains which.

Customer acquisition cost (CAC, CPA). Marketing spend divided by FTDs. Ranges from tens to several hundred pounds, euros or dollars depending on market and channel; the American states at launch saw acquisition costs in the high hundreds of dollars. Blended CAC (all marketing over all FTDs) and channel CAC (affiliate CPA, paid search cost per FTD) are managed separately.

Lifetime value (LTV). The NGR a customer is expected to generate over their life, discounted or not, usually estimated from the cohorts that came before. LTV divided by CAC is the ratio every acquisition decision turns on; a ratio of 3 or more is healthy, and a business acquiring at a ratio below 1 is destroying value with every customer. Payback period, the months until a cohort's cumulative NGR exceeds its acquisition cost, is the cash version of the same measure and is typically six to eighteen months.

Retention and churn. The share of a cohort still active after one, three, six and twelve months (retention) and the share lost in a period (churn). Online gambling retention is low by the standards of subscription businesses: a large share of FTDs never deposit a second time, and an operator's economics depend on the minority who become regulars. Reactivation, bringing back lapsed customers, is the cheapest acquisition there is and a standard CRM discipline.

Deposit measures. Deposits per active, average deposit, deposit-to-GGR ratio (how much of deposited money the operator keeps, a rough measure of how long money stays in play) and withdrawal ratios.

VIP concentration. The share of NGR from the top 1 or 5 per cent of customers. Commonly 30 to 50 per cent or more in casino, which is why regulators focus on VIP treatment and affordability and why a single customer's departure can move a quarter's results.

Marketing measures

Cost per acquisition by channel, as above. Return on advertising spend (ROAS) for paid media. Affiliate share of FTDs and NGR, and affiliate revenue-share liabilities. Conversion rates at each stage: visit to registration, registration to FTD, FTD to second deposit. The Affiliate Programmes Explained guide covers the channel measures.

Operational and compliance measures

Withdrawal time (request to funds received), the single most-watched customer-service measure. Verification rate and time. Complaint volumes and regulator complaint referrals. Responsible-gambling measures: share of customers with limits set, interaction volumes, self-exclusions, affordability check rates; regulators in Britain and the Netherlands now expect operators to report these. Fraud and chargeback rates. Uptime and game load times. Net promoter score where the operator measures it.

Reading an operator's results

Listed operators report quarterly, and the numbers are chosen to tell a story. The disciplines for reading them:

Check what "revenue" means (GGR, NGR, or something else) and whether gaming tax is above or below the line. Check whether actives are monthly averages, period totals or something else, and whether the definition changed. Separate constant-currency and reported growth. Look for the hold commentary in sports results: a company that beat expectations because of favourable sports results has not improved its business. Watch the bonus ratio and marketing as a share of revenue, which reveal whether growth was bought. Distinguish adjusted from reported EBITDA and read what was adjusted. Look at contribution by market, because a group's headline can hide a market that is losing money. And look at the balance sheet for player-fund liabilities, affiliate liabilities and regulatory provisions.

The How iGaming Companies Make Money guide builds the model from these measures, and the Largest iGaming Operators guide applies it.

A worked example

An online casino in a regulated European market in one month: 20 million in deposits; 400 million in turnover (money recycled twenty times); 3.8 per cent blended house edge, so GGR of 15.2 million; bonus cost of 3.0 million (a 20 per cent bonus ratio); gaming tax at 20 per cent of GGR, 3.0 million; payment costs 0.5 million; NGR of 8.7 million. 60,000 actives, so ARPU of 145. 8,000 FTDs at a blended CAC of 250, so 2.0 million in marketing. Content and platform fees at 12 per cent of GGR, 1.8 million. Contribution of 4.9 million before staff and overheads. Top 5 per cent of customers producing 45 per cent of NGR. Six-month retention of 25 per cent; twelve-month cohort LTV of 400, so LTV to CAC of 1.6, which is thin, and a payback of ten months.

Every one of those numbers is a lever, and the operator's management is the business of moving them.

Frequently asked questions

What is the difference between GGR and NGR? GGR is stakes less winnings. NGR is GGR less bonuses, gaming tax, payment costs and whatever else the operator's definition deducts. NGR is what affiliates and suppliers are usually paid on, and its definition is the most negotiated term in the industry.

What is hold in sports betting? GGR as a percentage of handle. Around 5 to 10 per cent for online sportsbooks, rising with parlay share, and volatile from quarter to quarter with results.

What is a good LTV to CAC ratio? Three or more is healthy; below one means each customer costs more than they will ever return. Payback within a year is the usual target.

What is an FTD? A first-time depositor: a customer who made a first deposit in the period. The industry's standard acquisition count and the basis of CPA affiliate deals.

Why do operators report actives differently? There is no standard. Some count any activity, some real-money play, some average across months. Read the definition before comparing.

What is a normal bonus ratio? 15 to 30 per cent of GGR for online casino in competitive markets, lower for sports and in markets that restrict bonuses. Rising ratios mean growth is being bought.

Related on iGaming Times

Data and Analytics Foundations is the course that builds the measurement system. Casino Bonuses and Wagering Requirements Explained covers the largest deduction between GGR and NGR. CRM and Player Lifecycle covers retention, churn and reactivation, and How to Start an Online Casino shows the numbers in a launch plan.

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Regulation, tax and market figures move quickly, sometimes mid-year. Where this guide gives a number, treat it as a starting point and confirm the current position with the named primary source before you rely on it.