Online gaming fuels record Q1 for Rush Street Interactive

Rush Street Interactive (RSI) is fresh off a banner first quarter of 2024 that saw the business establish new records for both revenue and adjusted EBITDA fueled by its online sports betting (OSB) and igaming segments.

For the three months ending March 31, 2024, RSI generated $217.4m in total revenue, a 33.9% year-on-year (YOY) increase from $162.4m during the same period of 2023. 

Adjusted EBITDA amounted to $17.1m for the quarter after registering at an $8.7m loss in Q1 last year, a swing of $25.8m. Net losses were significantly reduced as well, amounting to $2.2m for the quarter – down from $24.5m in Q1 2023.

“We are extremely pleased with our record first quarter results,” said RSI CEO Richard Schwartz. “This was accomplished by growing both our icasino and online sports businesses by over 35% year-over-year, in large part by acquiring new players more efficiently while simultaneously increasing the number and value of our users.”

While RSI boasts a solid portfolio of OSB states, it has historically placed a greater emphasis on igaming, which has led to record revenue growth rates in the three biggest US online casino states – Michigan, New Jersey, and Pennsylvania.

“Our focus on the online casino experience is resonating with new and existing customers, driving very solid growth in these existing markets,” Schwartz added.

The operator also revealed monthly active users in the US and Canada landed at around 176,000, up 20% YOY, while in Latam, actives amounted to 224,000, up 72% YOY.

RSI also noted US and Canada average revenue per monthly active user was $355, a 9% YOY increase. In Latam, this figure landed at $43, a 4% YOY uptick.

Elsewhere, adjusted advertising and promo expenses fell 24% YOY to $37.8m.

Schwartz also referenced RSI’s new presence in Delaware – another dual OSB-igaming state – where it took over for 888 as the Delaware Lottery’s exclusive operator in December and has increased the state’s annual gross gaming revenue run rate to nearly $70m.

“This was driven by a strong end to the quarter,” Schwartz said. “We ran over four times the rate of the previous operator during the month of March, with around 75% of this GGR attributed to online casino.”

Schwartz also would not be drawn on addressing the rumors of a potential sale of the business to DraftKings.

During an analyst call following the publication of the results, the CEO said he could not comment in a public setting as to why a strategic review hadn’t been formally started.

As a result of the record quarter, RSI adjusted its full-year guidance and is now projecting revenue to be between $810m and $860m, a $35m midpoint increase from its original guidance.

Adjusted EBITDA is expected to be between $50m and $60m, with the midpoint increasing by $15m.