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Net gaming revenue (NGR)
NGR stands for Net Gaming Revenue. In iGaming, it usually means Gross Gaming Revenue (GGR) after defined gaming-related deductions such as bonuses, gaming taxes, payment fees, chargebacks, jackpot contributions, or supplier costs.
A common working formula is:
NGR = GGR − Defined deductions
Where:
GGR = Player stakes − Player winnings
There is no single universal NGR formula. The deductions depend on the operator, contract, jurisdiction, product, and reporting purpose. That is the most important point to understand: two companies can start with identical GGR and report different NGR.
NGR is also not the same as net profit. It normally sits above salaries, rent, technology overhead, general marketing, interest, depreciation, and other operating or corporate expenses.
How Is Net Gaming Revenue Calculated?
One operator might use:
NGR = GGR − Bonuses − Gaming taxes − Payment fees − Supplier fees
Another may also deduct:
- chargebacks and fraud costs;
- progressive jackpot contributions;
- affiliate commissions;
- platform or data fees;
- returned stakes;
- administration fees;
- licence or regulatory charges.
Public documents illustrate the variation. Playtech’s 2024 annual report presents NGR as GGR minus player bonuses and tax. The Casumo Partners affiliate terms define “Net Revenue” more broadly, deducting winnings, bonuses, administration fees, fraud costs, chargebacks, returned stakes, duties or taxes, jackpot contributions, and third-party game or software fees.
Neither formula is automatically correct for every business. The correct formula is the one explicitly defined for the report or agreement being used.
NGR Example
Suppose an online operator records:
| Item | Amount |
|---|---|
| Player stakes | $1,000,000 |
| Player winnings | −$920,000 |
| GGR | $80,000 |
| Bonuses | −$12,000 |
| Gaming taxes | −$10,000 |
| Payment fees | −$3,000 |
| Supplier fees | −$5,000 |
| NGR | $50,000 |
First calculate GGR:
$1,000,000 − $920,000 = $80,000
Then apply the defined deductions:
$80,000 − $12,000 − $10,000 − $3,000 − $5,000 = $50,000
The operator’s NGR under this formula is $50,000. If the same operator’s contract also deducted affiliate commissions or chargebacks, the result would be lower.
NGR vs GGR
Gross Gaming Revenue (GGR) measures gross operator win from gambling activity before most costs. NGR starts from GGR and removes a defined set of deductions.
| Metric | Simplified formula | Main use |
|---|---|---|
| Turnover | Total stakes | Betting volume |
| GGR | Stakes − winnings | Gross gaming performance |
| NGR | GGR − defined deductions | Retained gaming revenue under a stated formula |
| Operating profit | Revenue − operating expenses | Wider business profitability |
GGR is generally more consistent as a concept, although statutory rules still vary. The UK Gambling Commission, for example, requires Gross Gambling Yield (GGY) in regulatory returns and provides a specific legal formula for it. It does not supply one universal industry NGR deduction list.
This distinction matters when comparing companies. Entain’s 2025 annual report defines its NGR non-GAAP measure as net revenue before VAT and sales taxes, which is different from both the simplified formula above and an affiliate program’s “net revenue” definition.
What Costs Are Commonly Deducted From NGR?
Bonuses and promotions. Free spins, bonus credits, free bets, cashback, and loyalty rewards may reduce NGR. The accounting basis matters: face value, amount wagered, converted cash value, or another contractual method can produce different results.
Gaming taxes and levies. Some formulas deduct gaming duty or market-specific levies. Others report NGR before certain sales taxes or use a separate tax reconciliation.
Payment costs and chargebacks. Payment service provider fees, acquiring costs, failed transactions, and chargebacks may be included when they are directly connected to player revenue.
Game and platform fees. Content royalties, platform revenue share, live data, and other supplier costs may be deducted, particularly in B2B and white-label arrangements.
Affiliate costs. An operator’s management-reporting formula may deduct CPA or affiliate commissions. In affiliate contracts, however, the affiliate’s RevShare commission is often calculated as a percentage of NGR rather than deducted before its own calculation. The agreement must make the order of operations clear.
Fraud and jackpot costs. Some definitions include fraud losses, progressive jackpot contributions, voids, and returned stakes.
NGR Margin
NGR margin measures the share of GGR left after the formula’s deductions:
NGR margin = NGR ÷ GGR × 100
In the example:
$50,000 ÷ $80,000 × 100 = 62.5%
This ratio can help track deduction pressure over time. It should not be benchmarked across companies unless their NGR definitions are aligned.
Why NGR Matters
Commercial performance. GGR can grow while NGR remains flat if bonuses, taxes, payments, or supplier costs rise. NGR makes those direct revenue leaks visible.
Affiliate RevShare. Many RevShare agreements pay a percentage of contract-defined NGR. The deduction list can matter more than the headline commission rate. For example, 35% of a narrowly defined NGR base may pay more than 40% of a base reduced by numerous fees. Affiliates should check deductions, negative carryover, player attribution, reporting periods, and whether terms can change.
Common NGR Mistakes
Calling NGR profit. NGR generally excludes many operating and corporate costs. It is closer to retained gaming revenue than GGR, but it is not automatically EBITDA or net income.
Using an undocumented formula. Every dashboard, contract, and board report should state the deductions and treatment of bonuses, taxes, fees, and chargebacks.
Comparing unlike definitions. A public company’s non-GAAP NGR, an internal product KPI, and an affiliate program’s net revenue can all use different formulas.
Double-counting deductions. If affiliate commission is calculated from NGR, subtracting it before calculating that same commission can create a circular or understated result unless the contract specifically requires that treatment.
Ignoring negative periods. Player winnings can make GGR or NGR negative. Contracts should specify whether negative balances reset, carry forward, or are applied only to particular players, products, or markets.
Mixing placed and settled bets. Sports wagers may remain open across reporting periods. Finance and affiliate systems must use the same recognition and settlement rules.
FAQ
What does NGR stand for in iGaming?
NGR stands for Net Gaming Revenue.
What is the NGR formula?
The general formula is GGR minus defined deductions. Common deductions include bonuses, taxes, payment fees, chargebacks, jackpot contributions, and supplier costs.
Is NGR the same as profit?
No. NGR usually excludes many operating and corporate expenses, so it is not the same as EBITDA, operating profit, or net income.
Why do NGR definitions differ?
NGR is used in internal reporting, public-company disclosures, supplier agreements, and affiliate contracts. Each can specify a different set of deductions.
Can NGR be negative?
Yes. Player winnings or deductions can exceed GGR in a period. Contracts should explain how negative NGR is handled.
Is affiliate commission calculated from NGR?
Often, but not always. RevShare terms should state the exact revenue base, deductions, percentage, and negative-carryover policy.
Bottom Line
NGR is GGR after a defined set of deductions. It is useful only when those deductions are explicit. For accurate analysis, document the formula, keep it consistent across systems, and never treat NGR as a universal synonym for profit.