According to the latest financial results from the company, Rush Street’s losses for the year swelled to $124.8 million compared to $94.3 million in 2021, but during the company’s Q4 earnings calls, CEO Richard Schwartz spoke about the mindful spending and how it will help the company in the long-term.
Rush Street Interactive losses doubled from $19.5 million in 2021 to $38.6 million last year. However, Q4 numbers for the interactive division saw YoY improvements even with losses.
Here is a look at the top-line numbers for Rush Street Gaming in Q4 and for 2022:
Q4 revenue: $165.5 million, up 26.7% YoY
Q4 EBITDA: ($28.4 million), down 30.7% YoY
Net losses for Rush Street Interactive in Q4: $9 million, down 13.6% YoY
2022 revenues: $414.7 million, up 24.8% from 2021
2022 EBITDA: ($124.8 million), down 32.4% from 2021
Net losses for Rush Street Interactive in 2022: $38.6 million, up 98.2% from 2021
“For those who have followed us over time, you will appreciate that our top-line growth is not growth at all costs. Rather, it is purpose-driven and the results reflect our demonstrated ability to acquire and retain customers at sensible investment levels,” Schwartz said during the earnings call.
“In our newest sports-only states of Maryland and Ohio, we have evolved our approach and invested less in early marketing initiatives relative to our previous sports-only market launches. We expect this level of investment to be reflected in our market share, but we also expect faster recovery of our initial investment in these market launches. “
In Maryland, BetRivers has just half a percent of handle market share so far, but they are also one of only three books to make money in the state thanks to a more modest promotional spend. Through the first three months of Maryland online betting operations, the operator has spent just $261K in promotional credit and earned $82K.
For the first month in Ohio, BetRivers collected $2.9 million in wagers, spent $261K in promotional credit, and reported $149K in revenue, amounting to a $12K loss for the first month and 0.2% market share.
“For the full year, marketing spend was down about 140 basis points compared to last year when measured as a percentage of net revenue. And this is with an investment-heavy first quarter of this year. If we were to look at marketing spend as a percentage of net revenue over the last three quarters, we’ve seen an improvement of 560 basis points year-over-year.”
Like many other mid-tier operators, BetRivers is focusing on online casino expansion to help fuel growth. Schwartz noted that the industry support around the issue when it comes to lobbying and legislation is different than it has been on other issues.
“In terms of the online casino, the industry is aligned in a way that I haven’t seen before and you’re starting to see a lot of investments being made and lobbying efforts to legalize online casino in a way that you haven’t seen over the last decade,” he said. “That’s extremely exciting. I think it’s clear why casino is a larger, more profitable category, the industry and legislators are realizing the value of the combination, how effective it is.”