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Rush Street Interactive Optimistic after Q3 Performance

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Rush Street Interactive reported a decline in net loss during Q3 due to a 14.9% increase in revenue, and the company has said that it is optimistic about achieving positive EBITDA for the entire year.

For the three months ending 30 September, group revenue amounted to $169.9m. According to Rush Street Interactive, this is an improvement from Q3 the previous year and surpasses the $165.1m of Q2.

CEO Richard Schwartz highlighted how the numbers showcase the company's ongoing growth and broader expansion efforts. He emphasized that Rush Street Interactive is now a prominent iGaming operator, and its online sports betting segment keeps growing.

Rush Street Enjoys Success in Delaware

Recent developments in Delaware could mean more success for Rush Street Interactive in the iGaming sector. In August, the company was chosen to support the Delaware State Lottery's iGaming platform. The plan is to offer its iGaming solution for an initial five years, aiming for a launch by 2023.

Schwartz remarked that such developments reveal Rush Street Interactive's commitment to business expansion.

Our Q3 results offer further evidence that we continue to grow in very competitive markets with a remarkable success and resilience. We have multiple opportunities to grow our business and we’re disciplined in how we execute our growth. Looking ahead, expanding our footprint, we announced exciting news in August in that we were selected by a Delaware Lottery as their exclusive online provider. We are targeting to launch by early winter. As discerning consumers seek out the best products and user experiences, our Q3 results affirm our ability to deliver on both counts as we continue to acquire, engage and retain customers.

Richard SchwartzRush Street Interactive CEO

Rush Street Interactive Boosts Market Presence

In his analysis of Q3 outcomes, Schwartz highlighted several accomplishments, notably the company's ability to enhance its market presence in crucial sectors. Online casino shares in New Jersey and Michigan have surged past their levels in the previous year. Moreover, its share in the West Virginia online casino market has peaked since its inception in the state.

There are comparable patterns in the company's sportsbook ventures. The company’s share of the sports betting and iGaming markets in states such as Michigan, Virginia, New York, Maryland, and Ohio has never been higher. Furthermore, Pennsylvania and Indiana market shares have reached their 18-month highs.

Moving Towards Profitability in Q3

Though Q3 witnessed revenue growth, it was also accompanied by escalated costs, as Rush Street Interactive aimed for further growth. Overall operational costs surged by 7.7% to $181.6m, with primary revenue expenses amounting to $116.2m.

The firm acknowledged an added $762,000 in interest income, which led to a pre-tax loss of $10.9m, a notable enhancement from $20.8m in 2022. Taxes for Rush Street Interactive were $2.4m, and they also accounted for $9.2m in losses from non-controlling stakes.

Therefore, the net loss for Q3 was trimmed by 36.4% to $4.2m. Additionally, the firm reported a positive adjusted EBITDA of $4.1m, in stark contrast to the prior year's $12.5m deficit.

Positive Expectations for Annual Adjusted EBITDA

Considering the year-to-date figures, revenues for the nine months leading to 30 September stood at $497.3m, a leap of 16.6% from $426.7m during the same timeframe in the previous year.

Operational costs for this span rose by 4.3% to $545.4m. Interest gains reached $1.4m, resulting in a pre-tax loss of $46.7m, a substantial improvement from $97.1m in 2022.

Tax obligations totaled $6.2m, and losses of $73.6m from non-controlling stakes were deducted by Rush Street Interactive. Thus, the net loss for this period was scaled down to $16.6m, which is shorter than the $29.6m loss of the preceding year.

The adjusted EBITDA was at a loss of $3.3m. However, considering the stark contrast from the $74.5m deficit in 2022, there is a strong sentiment within Rush Street Interactive to achieve a positive adjusted EBITDA throughout the year.

Regarding the full-year revenue forecast, the estimate has been slightly adjusted. The company projects its revenue to range between $665.0m and $685.0m. The middle value of this range ($675.0m) would signify a 14.0% surge from $592.0m in 2022.

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