Food, wine, and women were, of course, popular ways for gladiators (and soldiers) to spend their money.

I don’t really know of any primary sources that talk about gladiators spending prize money to upgrade their armor, but gladiators did absolutely upgrade/decorate their armor all the time.

Gladiator matches usually started with a sort of parade or display, and the top gladiators would wear elaborate costumes, sometimes color-coded to their patron or sponsor, or color-coded to their ludus or gladiator school. This is sort of similar to how modern teams all wear the same set of uniform colors, the ludus is sort of like the “team” here. For example, gladiators that were sponsored by Julius Caesar all wore armor that was plated in silver (as opposed to the typical bronze).

Gladiators also probably added to their costume/armor based on victories. This is conjecture on my part but in artwork of famous elite gladiators, they’re always more decorated and fancier looking than the “regular” chump gladiators they’re defeating.

Remember also gladiators weren’t just fighters but also entertainers, so it would stand to reason that gladiators would spend money on better looking armor or decorations since a big part of being cool is looking cool.

When it gets down to functional armor, that gets a little weirder. Gladiators were sorted into different “classes” who used specific equipment sets - the murmillo for example is what we mostly think of as a gladiator: short sword, shield, greaves, one armored sleeve, and a big fancy helmet. The retiarius fought with a spear/trident and a weighted net. It seems as if the concept of fairness was at least sort of important, so gladiators were usually equipped in a very similar, standard way.

Presumably, the ludus would provide the equipment, much like a modern sports team provides the uniforms and safety gear for the players, and a ludus with lots of money would almost certainly spend it on better weapons and armor for their gladiators so that they win more.