- Third Quarter Revenue of $148 Million, up 20%
Year-over-Year -
- Fourteenth Consecutive Quarter of Sequential
Revenue Growth -
Rush Street Interactive, Inc. (NYSE: RSI) (“RSI”), a leading
online casino and sports betting company in the United States and
the rest of the Americas, today announced financial results for the
third quarter ended September 30, 2022.
Third Quarter 2022 Financial Highlights
- Revenue was $148.0 million during the third quarter of 2022, an
increase of 20%, compared to $122.9 million during the third
quarter of 2021.
- Net loss was $22.7 million during the third quarter of 2022,
compared to a net loss of $18.9 million during the third quarter of
2021.
- Adjusted EBITDA1 was a loss of $12.5 million during the third
quarter of 2022, compared to an Adjusted EBITDA loss of $12.2
million during the third quarter of 2021.
- Adjusted advertising and promotions expense1 was $44.7 million
during the third quarter of 2022, a decrease of 2%, compared to
$45.4 million during the third quarter of 2021.
- Real-Money Monthly Active Users (“MAUs”) in the United States
and Canada for the third quarter of 2022 grew 31% year-over-year to
130,000 with average revenue per MAU (“ARPMAU”) of $345 during the
third quarter of 2022, up 6% sequentially.
- As of September 30, 2022, unrestricted cash and cash
equivalents on the balance sheet were $195 million with no debt
outstanding.
Richard Schwartz, Chief Executive Officer of RSI, said, “We
posted a solid third quarter, as our efficient approach to
marketing and robust platform continue to perform well. Despite a
lower than normal online casino hold rate and currency headwinds
during the quarter, which we believe collectively impacted our
quarterly revenue by an estimated $6 million, we generated record
revenues for the fourteenth straight quarter and progressed towards
our profitability goals and our target of being Adjusted EBITDA
positive for the second half of 2023.”
“In terms of activity, we continue to see very strong volumes in
markets where we operate both online casino and sports betting, as
we are able to execute on the enhanced profitability offered by the
online casino vertical in these markets. Internationally, we are
seeing strong results from both Colombia and Ontario and we are
excited to begin increasing marketing efforts in Mexico. We remain
focused on building a strong foundation in our new markets that
will provide stable, long-term growth opportunities while keeping
an eye on future profitability.”
________________________ 1 This is a non-GAAP financial measure.
Please see “Non-GAAP Financial Measures” for more information about
this non-GAAP financial measure and “Reconciliations of GAAP to
Non-GAAP Financial Measures” for a reconciliation of the most
comparable measure calculated in accordance with GAAP to this
non-GAAP financial measure.
Updating 2022 Revenue Guidance
Considering the effects of currency fluctuations impacting our
international revenue and our third quarter results announced
today, RSI expects revenues for the full year ending December 31,
2022 to be between $580 million and $600 million. At the midpoint
of the range, revenue for the fourth quarter represents 25%
year-over-year growth.
Recent Business Highlights
- Expanded partnership with LaLiga to be the exclusive sportsbook
partner throughout South America.
- Rebranded our New Jersey online casino and sportsbook to
BetRivers for stronger branding and marketing efficiencies.
- Opened in-person sports betting in Maryland at the BetRivers
Sportsbook at Bingo World.
- Expanded our ambassador relationships and betting content
production capabilities with the additions of sports media
personalities Mike Missanelli in Philadelphia and Bob McCown in
Toronto.
- Plans to launch online sports betting in both Maryland and Ohio
in upcoming months.
Earnings Conference Call and Webcast Details
RSI will host a conference call and audio webcast today at 5:00
p.m. Eastern Time (4:00 p.m. Central Time), during which management
will discuss third quarter results and provide commentary on
business performance and its current outlook for 2022. A
question-and-answer session will follow the prepared remarks.
The conference call may be accessed by dialing 1-844-200-6205
for domestic callers or 1-929-526-1599 for international callers.
The conference call access code is 167646.
A live audio webcast of the earnings conference call may be
accessed on RSI’s website at ir.rushstreetinteractive.com, along
with a copy of this press release and an investor slide
presentation. The audio webcast and investor slide presentation
will be available on RSI’s investor relations website until at
least December 2, 2022.
About Rush Street Interactive
RSI is a trusted online gaming and sports entertainment company
focused on markets in the United States, Canada and Latin America.
Through its brands, BetRivers, PlaySugarHouse and RushBet, RSI was
an early entrant in many regulated jurisdictions. It currently
offers real-money mobile and online operations in thirteen U.S.
states: Pennsylvania, Illinois, New Jersey, New York, Connecticut,
Michigan, Indiana, Virginia, Colorado, Iowa, West Virginia, Arizona
and Louisiana, as well as in the regulated international markets of
Ontario, Canada, Colombia and Mexico. RSI offers, through its
proprietary online gaming platform, some of the most popular online
casino games and sports betting options in the United States.
Founded in 2012 in Chicago by gaming industry veterans, RSI was
named the 2022 EGR North America Awards Operator of the Year,
Customer Services Operator of the Year and Social Gaming Operator
of the Year, and the 2021 SBC Latinoamérica Awards Sportsbook
Operator of the Year. RSI was the first U.S.-based online casino
and sports betting operator to achieve RG Check iGaming
Accreditation from the Responsible Gaming Council. For more
information, visit www.rushstreetinteractive.com.
Non-GAAP Financial Measures
In addition to providing financial measurements based on
accounting principles generally accepted in the United States
(“GAAP”), this press release includes certain financial measures
that are not prepared in accordance with GAAP, including Adjusted
EBITDA, Adjusted Operating Costs and Expenses, Adjusted Net Loss
Per Share, Adjusted Net Loss and Adjusted Weighted Average Common
Shares Outstanding, each of which is a non-GAAP performance measure
that RSI uses to supplement its results presented in accordance
with GAAP. A reconciliation of each such non-GAAP financial measure
to the most directly comparable GAAP financial measure can be found
below. RSI believes that presentation of these non-GAAP financial
measures provides useful information to investors regarding RSI’s
results of operations and operating performance, as they are
similar to measures reported by its public competitors and are
regularly used by securities analysts, institutional investors and
other interested parties in analyzing operating performance and
prospects. These non-GAAP financial measures are not intended to be
considered in isolation or as a substitute for any GAAP financial
measures and, as calculated, may not be comparable to other
similarly titled measures of performance of other companies in
other industries or within the same industry.
RSI defines Adjusted EBITDA as net income (loss) before
interest, income taxes, depreciation and amortization, share-based
compensation, adjustments for certain one-time or non-recurring
items and other adjustments. Adjusted EBITDA excludes certain
expenses that are required in accordance with GAAP because certain
expenses are either non-cash (i.e., depreciation and amortization,
and share-based compensation) or are not related to our underlying
business performance (i.e., interest income or expense).
RSI defines Adjusted Operating Costs and Expenses as RSI’s GAAP
operating costs and expenses adjusted to exclude the impacts of
share-based compensation, certain one-time or non-recurring items
and other adjustments. Adjusted Operating Costs and Expenses
excludes certain expenses that are required in accordance with GAAP
because certain expenses are either non-cash (i.e., share-based
compensation) or are not related to our underlying business
performance.
RSI defines Adjusted Net Loss Per Share as Adjusted Net Loss
divided by Adjusted Weighted Average Common Shares Outstanding.
Adjusted Net Loss is defined as net loss attributable to Rush
Street Interactive, Inc. as used in the diluted net loss per share
calculation, adjusted for the reallocation of net loss attributable
to non-controlling interests, share-based compensation, certain
one-time or non-recurring items and other adjustments. Adjusted
Weighted Average Common Shares Outstanding is defined as the
weighted average number of common shares outstanding as used in the
diluted net loss per share calculation, adjusted for the assumed
conversion of the non-controlling interest’s Rush Street
Interactive, LP Class A units to Class A common stock of RSI on a
one-to-one-basis.
RSI includes these non-GAAP financial measures because
management uses them to evaluate RSI’s core operating performance
and trends and to make strategic decisions regarding the allocation
of capital and new investments. Management believes that these
non-GAAP financial measures provide investors with useful
information on RSI’s past financial and operating performance,
enable comparison of financial results from period-to-period where
certain items may vary independent of business performance, and
allow for greater transparency with respect to metrics used by
RSI’s management in operating our business. Management also
believes these non-GAAP financial measures are useful in evaluating
our operating performance compared to that of other companies in
our industry, as these metrics generally eliminate the effects of
certain items that may vary from company to company for reasons
unrelated to overall operating performance.
Key Metrics
RSI provides certain key metrics, including MAUs and ARPMAU, in
this press release. RSI defines MAUs as the number of unique users
per month who have placed at least one real-money bet across one or
more of our online casino or online sports betting offerings, and
it defines ARPMAU as average revenue for the applicable period
divided by the average MAUs for the same period.
The numbers RSI uses to calculate MAUs and ARPMAU are based on
internal RSI data. While these numbers are based on what RSI
believes to be reasonable judgments and estimates of its customer
base for the applicable period of measurement, there are inherent
challenges in measuring usage and engagement with respect to RSI’s
online offerings across its customer base. Such challenges and
limitations may also affect RSI’s understanding of certain details
of its business. In addition, RSI’s key metrics and related
estimates, including the definitions and calculations of the same,
may differ from estimates published by third parties or from
similarly-titled metrics of its competitors due to differences in
operations, offerings, methodology and access to information. RSI
regularly reviews, and may adjust its processes for calculating,
its internal metrics to improve their accuracy.
Forward-Looking Statements
This press release includes "forward-looking statements" within
the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995. RSI's actual results may
differ from their expectations, estimates and projections and
consequently, you should not rely on these forward-looking
statements as predictions of future events. Words such as "expect,"
"estimate," "project," "budget," "forecast," "anticipate,"
"intend," "plan," "may," "will," "could," "should," "believes,"
"predicts," "potential," "continue," and similar expressions are
intended to identify such forward-looking statements. These
forward-looking statements include, without limitation, statements
regarding guidance (which are based on the same assumptions used
for RSI’s 2022 guidance, and no impact from any new market launches
after November 2, 2022), RSI’s future results of operations,
financial condition or profitability, currency fluctuations, RSI’s
strategic plans and focus, anticipated launches of RSI’s current or
new offerings in existing or future jurisdictions, player growth
and engagement, product initiatives and the objectives of
management for future operations. These forward-looking statements
involve significant risks and uncertainties that could cause the
actual results to differ materially from the expected results. Most
of these factors are outside RSI's control and are difficult to
predict. Factors that may cause such differences include, without
limitation: changes in applicable laws or regulations; RSI’s
ability to manage growth; RSI’s ability to execute its business
plan, meet its projections and obtain relevant market access and/or
gaming licenses; unanticipated product or service delays; general
economic and market conditions impacting the demand for RSI’s
products and services; economic and market conditions in the
gaming, entertainment and leisure industry in the markets in which
RSI operates; the potential adverse effects of COVID-19 on capital
markets, general economic conditions, inflation rates, unemployment
and RSI’s liquidity, operations and personnel; and other risks and
uncertainties indicated from time to time in RSI's filings with the
SEC. RSI cautions that the foregoing list of factors is not
exclusive. RSI cautions readers not to place undue reliance upon
any forward-looking statements, which speak only as of the date
made. RSI does not undertake or accept any obligation or
undertaking to release publicly any updates or revisions to any
forward-looking statements to reflect any change in its
expectations or any change in events, conditions or circumstances
on which any such statement is based, except as required by
law.
Rush Street Interactive,
Inc.
Condensed Consolidated
Statements of Operations
(Unaudited and in thousands,
except per share data)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2022
2021
2022
2021
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
Revenue
$
148,004
$
122,920
$
426,678
$
357,540
Operating costs and expenses
Costs of revenue
103,321
81,221
308,061
245,668
Advertising and promotions
45,203
46,077
156,794
125,836
General administration and other
16,040
12,318
48,190
40,650
Depreciation and amortization
4,039
1,007
10,066
2,595
Total operating costs and expenses
168,603
140,623
523,111
414,749
Loss from operations
(20,599
)
(17,703
)
(96,433
)
(57,209
)
Other income (expenses)
Interest expense, net
(219
)
(11
)
(664
)
(41
)
Change in fair value of warrant
liabilities
—
—
—
41,802
Change in fair value of earnout interests
liability
—
—
—
(13,740
)
Total other income (expenses)
(219
)
(11
)
(664
)
28,021
Loss before income taxes
(20,818
)
(17,714
)
(97,097
)
(29,188
)
Income tax expense
1,839
1,225
6,176
3,781
Net Loss
$
(22,657
)
$
(18,939
)
$
(103,273
)
$
(32,969
)
Net loss attributable to non-controlling
interests
(16,044
)
(13,639
)
(73,631
)
(23,885
)
Net loss attributable to Rush Street
Interactive, Inc.
$
(6,613
)
$
(5,300
)
$
(29,642
)
$
(9,084
)
Net loss per common share attributable to
Rush Street Interactive, Inc. – basic
$
(0.10
)
$
(0.09
)
$
(0.47
)
$
(0.16
)
Weighted average common shares outstanding
– basic
64,058,437
59,191,384
63,283,591
55,148,218
Net loss per common share attributable to
Rush Street Interactive, Inc. – diluted
$
(0.10
)
$
(0.09
)
$
(0.47
)
$
(0.33
)
Weighted average common shares outstanding
– diluted
64,058,437
59,191,384
63,283,591
56,488,691
Rush Street Interactive,
Inc.
Condensed Consolidated
Statements of Comprehensive Loss
Three Months Ended
September 30,
Nine Months Ended
September 30,
2022
2021
2022
2021
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
Net loss
$
(22,657
)
$
(18,939
)
$
(103,273
)
$
(32,969
)
Other comprehensive loss
Foreign currency translation
adjustment
(1,368
)
(168
)
(1,777
)
(1,060
)
Comprehensive loss
$
(24,025
)
$
(19,107
)
$
(105,050
)
$
(34,029
)
Comprehensive loss attributable to
non-controlling interests
(17,014
)
(13,762
)
(74,877
)
(24,685
)
Comprehensive loss attributable to Rush
Street Interactive, Inc.
$
(7,011
)
$
(5,345
)
$
(30,173
)
$
(9,344
)
Rush Street Interactive,
Inc.
Reconciliations of GAAP to
Non-GAAP Financial Measures
(Unaudited and in thousands)
Adjusted EBITDA:
Three Months Ended
September 30,
Nine Months Ended
September 30,
($ in thousands)
2022
2021
2022
2021
Net loss
$
(22,657
)
$
(18,939
)
$
(103,273
)
$
(32,969
)
Interest expense, net
219
11
664
41
Income tax expense
1,839
1,225
6,176
3,781
Depreciation and amortization
4,039
1,007
10,066
2,595
Change in fair value of warrant
liabilities
—
—
—
(41,802
)
Change in fair value of earnout interests
liability
—
—
—
13,740
Share-based compensation expense
4,084
4,468
11,901
20,705
Adjusted EBITDA
$
(12,476
)
$
(12,228
)
$
(74,466
)
$
(33,909
)
Adjusted Operating Costs and
Expenses:
Three Months Ended
September 30,
Nine Months Ended
September 30,
2022
2021
2022
2021
GAAP operating costs and
expenses:
Costs of revenue
$
103,321
$
81,221
$
308,061
$
245,668
Advertising and promotions
45,203
46,077
156,794
125,836
General administration and other
16,040
12,318
48,190
40,650
Depreciation and amortization
4,039
1,007
10,066
2,595
Total operating costs and
expenses
$
168,603
$
140,623
$
523,111
$
414,749
Non-GAAP operating cost and expense
adjustments:
Costs of revenue1
$
(249
)
$
(298
)
$
(739
)
$
(1,511
)
Advertising and promotions1
(516
)
(637
)
(1,532
)
(2,971
)
General administration and other1
(3,319
)
(3,533
)
(9,630
)
(16,223
)
Depreciation and amortization
—
—
—
—
Total non-GAAP operating cost and
expense adjustments
$
(4,084
)
$
(4,468
)
$
(11,901
)
$
(20,705
)
Adjusted operating costs and
expenses:
Costs of revenue
$
103,072
$
80,923
$
307,322
$
244,157
Advertising and promotions
44,687
45,440
155,262
122,865
General administration and other
12,721
8,785
38,560
24,427
Depreciation and amortization
4,039
1,007
10,066
2,595
Total adjusted operating costs and
expenses
$
164,519
$
136,155
$
511,210
$
394,044
1
Non-GAAP Operating Costs and Expense Adjustments for the
three-and-nine months ended September 30, 2022 and September 30,
2021 include Share-based compensation expense.
Rush Street Interactive,
Inc.
Reconciliations of GAAP to
Non-GAAP Financial Measures
(Unaudited and in thousands,
except share and per share data)
Adjusted Net Loss, Adjusted Weighted
Average Common Shares Outstanding and Adjusted Net Loss Per
Share:
Three Months Ended
September 30,
Nine Months Ended
September 30,
2022
2021
2022
2021
Adjusted Net Loss
Net loss attributable to Rush Street
Interactive, Inc. – diluted1
$
(6,613
)
$
(5,300
)
$
(29,642
)
$
(18,653
)
Adjustments:
Net loss attributable to non-controlling
interests
(16,044
)
(13,639
)
(73,631
)
(23,885
)
Change in fair value of warrant
liabilities attributable to non-controlling interests
—
—
—
(32,233
)
Change in fair value of earnout interests
liability
—
—
—
13,740
Share-based compensation expense
4,084
4,468
11,901
20,705
Adjusted Net Loss
$
(18,573
)
$
(14,471
)
$
(91,372
)
$
(40,326
)
Adjusted Weighted Average Common Shares
Outstanding
Weighted average common shares outstanding
– diluted2
64,058,437
59,191,384
63,283,591
56,488,691
Adjustments:
Conversion of weighted average RSILP Units
to Class A Common Shares
156,373,584
159,986,105
156,796,400
159,335,977
Adjusted Weighted Average Common Shares
Outstanding
220,432,021
219,177,489
220,079,991
215,824,668
Net loss per common share attributable to
Rush Street Interactive, Inc. – diluted:
$
(0.10
)
$
(0.09
)
$
(0.47
)
$
(0.33
)
Adjusted Net Loss per Share
$
(0.08
)
$
(0.07
)
$
(0.42
)
$
(0.19
)
1
Net loss attributable to Rush Street Interactive, Inc. – diluted
for the nine months ended September 30, 2021, includes the Net loss
attributable to Rush Street Interactive, Inc. adjusted for the
dilutive effect of previously outstanding warrants that were
redeemed in March 2021 (i.e., the portion of the change in fair
value of warrants attributed to Rush Street Interactive Inc.).
There was no dilutive effect for the three months ended September
30, 2021 or the three-and-nine months ended September 30, 2022.
2
Weighted average common shares outstanding – diluted for the nine
months ended September 30, 2021, includes the basic number of
weighted average common shares outstanding, adjusted for the
dilutive effect of previously outstanding warrants that were
redeemed in March 2021 using the Treasury Stock Method. There was
no dilutive effect for the three months ended September 30, 2021 or
the three-and-nine months ended September 30, 2022.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221102005842/en/
Media Contact: Lisa Johnson (609) 788-8548
lisa@lisajohnsoncommunications.com
Investor Contact: ir@rushstreetinteractive.com
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