Online casino and sports-betting operator Rush Street Interactive’s (RSI) second quarter 2024 report won’t blow anyone away. The operator reported revenue of $220.4 million during the second quarter, an increase of 34% compared to $165.1 million posted during the second quarter of 2023. It also reported a net loss of $0.3 million during the quarter. Compared to larger operators, that’s peanuts.
But a deeper dive into RSIt’s metrics shows that monthly active users reached 164,000, a 24% increase that bodes well for the company’s future.
“We’re adding more players to the platform faster,” said RSI CEO Richard Schwartz. “We’re doing it more efficiently and we’re maintaining high player value by offering a differentiated experience that keeps players coming back. All of this leads to solid top-line growth.”
“Richard mentioned we would set records for new players in both the U.S. and Latin America, but we also did so while cutting our cost to acquire players by more than half compared to last year,” said Chief Financial Officer Kyle Sauers. “Our prior marketing spend during the quarter was $36.3 million, down 10% compared to the prior year. As a percentage of revenue marketing, it was 16% during the quarter, down 24% in the year ago quarter. We do expect marketing spend to increase sequentially reflecting increased investment.”
The company also benefited from a strong presence in Latin America. Last week, the company announced it was launching igaming in Peru, adding it to a roster that includes Colombia and Mexico.
“The main driver of our growth right now is Colombia,” said Sauers. “We’re also very excited about Mexico. … I think Latin America makes up close to 15% of our revenue now, so it’s a really nice contributor that’s been growing faster than our North American business. That’s likely to continue for some time, certainly given the launch of Peru. And Mexico is starting to pick up some momentum. Latin America is nicely profitable for us. Latin America in total has higher gross margins than most of our North American markets, so strong growth in Latin America is incremental for the bottom line.”
Schwartz noted the company benefited from the recent Copa America, where Argentina beat Colombia. “It was an opportunity to bring home a bigger number of new players, introducing them to the Rush brand and platform, with the goal of retaining them for years to come.”
Analysts seemed particularly pleased by RSI’s results.
“The beat and raise in the quarter are evidence that RSI continues to execute on its strategies and define its differentiated capabilities,” wrote analyst David Katz of Jefferies. “Furthermore, the company continues to build its presence in Latin America, where it competes successfully. The company should continue to see further upside as OSB penetration grows in the U.S., as evidenced by the incremental guide. We expect a positive reaction to the report. Reiterate Buy.”
