Rush Street Interactive announced third-quarter revenues of $169.9 million in a November 1 earnings call. The company also pronounced itself optimistic in terms of a positive return on investment when full-year 2023 results are in.
Revenues rose 14 percent from 2022 and third-quarter losses narrowed to $13.4 million from $22.7 million in the same period of last year. The company realized return on investment of $4.1 million, reversing a $12.5 million loss the year before.
Marketing expenses also came down to $34.1 million from $44.7 million. Revenue averaged $374 per gambler. In addition to having $171 million cash on hand, Rush Street is on the verge of going live as the solutions provider for the Delaware Lottery.
In a statement penned prior to the third-quarter-earnings call, CEO Richard Schwartz declared, “Thanks to our decade-long investment in cutting-edge technology and a customer-centric approach, we’ve positioned ourselves as a top [five] online operator in the U.S., with a leading position in igaming and a growing online sportsbook. As discerning consumers seek out the best products and user experiences, our third-quarter results affirm our ability to deliver on both counts. We continue to acquire, engage, and retain customers.”
Continuing a trend of companies de-emphasizing sports betting, Schwartz said on the ensuing call that Rush Street was “a digital-first operator with an icasino customer-centric approach… Our third-quarter results offer further evidence that we continue to grow in very competitive markets with a remarkable success and resilience.”
Schwartz attributed the double-digit revenue growth to higher sports betting hold percentages and a sharp decline in marketing spending. He added that Rush Street’s market shares for igaming in New Jersey and Michigan “are higher than any time over the past year.” The CEO added, “This quarter is the first time in the company’s history that our sportsbook-only markets are profitable.” This, he continued, positions the company well if and when igaming is added to the mix.
Domestic territories gained in the last three years and its international markets were seeing 40 percent growth. Latin American countries, he said, represented 11 percent of Rush Street’s total revenues, with Mexico still ramping up from “a small base.”
Looking ahead, Schwartz expects New York State’s legislature to debate adding igaming to online sports betting next year, along with possible legalization in Alberta. “There is no shortage of near- and long-term opportunities in our universe,” he opined, describing the expansion of igaming as a question of if rather than when, due to state budgetary needs.
Schwartz also stressed new-product launches, saying that Rush Street had added 1,000 slot titles in igaming just in the third quarter, in addition to live-dealer games in Michigan. And by decentralizing prop bets, he said, that aspect of sports betting had seen an 87 percent year-over-year increase in wagering.
The CEO painted a picture of ever-increasing igaming market share, particularly in West Virginia, where it was at its highest level in 30 months. Similar things, Schwartz continued, were true of Michigan, Virginia, New York, Maryland, and Ohio, some of which are sportsbook-only.
“Domestically, as the U.S. markets mature, we’re very pleased with the balance we are achieving in our top line growth and the efficiency of the marketing investment required to maintain that growth and retain customers,” Schwartz summarized. “We’re seeing improved efficiencies that will set us up well for 2024 and beyond to grow revenue and further expand profitability.”
