Rush Street Interactive, Inc. ((RSI)) has held its Q4 earnings call. Read on for the main highlights of the call.
Rush Street Interactive, Inc. recently held an earnings call that conveyed a generally positive sentiment. The company reported significant revenue and EBITDA growth, with strong performances across North America and Latin America. Despite challenges such as tax changes in Colombia and potential increases in New Jersey, the company remains optimistic about future growth and strategic initiatives.
Record-Setting Revenue and EBITDA
The company concluded the year with a record-setting quarter in both revenue and adjusted EBITDA, surpassing the high end of its most recent guidance. The full year 2024 revenue grew by an impressive 34% year-over-year, showcasing the company’s robust financial health.
Significant EBITDA Growth
Rush Street Interactive reported a remarkable increase in adjusted EBITDA for the full year, which grew more than 11 times compared to the prior year, reaching $92.5 million. This substantial growth underscores the company’s effective cost management and operational efficiency.
Strong Performance in North America and Latin America
The company experienced strong growth in North America and Latin America, with online growth of 29% and 54% year-over-year, respectively. Monthly active users (MAUs) in North America reached a record 205,000, up 28% year-over-year, while Latin America saw a 71% increase to 348,000 MAUs.
Improved Gross Profit Margin
The gross profit margin increased to 36.5% in the fourth quarter, with a full-year improvement of over 200 basis points compared to the prior year. This improvement reflects the company’s focus on enhancing profitability.
Strong Cash Position
Rush Street Interactive ended the year with $229 million in unrestricted cash and no debt, marking an increase of approximately $61 million for the year. This strong cash position provides a solid foundation for future investments and growth.
Colombian Tax Implications
Recent tax changes in Colombia, involving a tax on player deposits, could impact revenue and EBITDA. The constitutionality of the tax is under review, introducing a degree of uncertainty for the company.
Potential Tax Increases in New Jersey
The company discussed potential tax increases in New Jersey and their possible impact on operations and marketing strategies. This remains a point of concern as it could affect profitability.
Regulatory Challenges in iGaming Expansion
Rush Street Interactive faces slow progress in iGaming legalization across new states, despite efforts and the presence of unregulated online casino activities in the U.S. This regulatory challenge could affect the company’s expansion plans.
Positive Outlook for 2025
The company has initiated full-year 2025 revenue guidance of $1.01 billion to $1.08 billion, representing a 13% year-over-year increase at the midpoint. Adjusted EBITDA is expected to grow 35% year-over-year, reflecting the company’s confidence in its strategic investments and operational efficiencies.
In conclusion, Rush Street Interactive’s earnings call highlighted a positive outlook with significant growth in revenue and EBITDA. Despite facing challenges such as tax implications and regulatory hurdles, the company remains optimistic about its future prospects and strategic initiatives.