Home News Ontario Becomes Rush Street Interactive’s Key Growth Driver

Ontario Becomes Rush Street Interactive’s Key Growth Driver

By Manny Wood.
Fact checked by Wilbur Thompson.

Rush Street Interactive, a prominent gaming group, experienced significant contributions from its online casino division during the first quarter, as highlighted in its latest earnings report. In particular, the company identified the Canadian capital province, Ontario, as a crucial element of its growth strategy.

In the disclosed Q1 figures, Rush Street announced impressive revenue of $217.94 million (USD$162.4 million) for the initial three months of 2023, reflecting a notable 20.4% year-on-year increase (Q1 2022: $181.03 million). The financial report also included other notable figures such as a reduced net loss of $32.88 million (USD$24.5 million), down by 53.2% compared to the previous year, and an adjusted EBITDA loss of $11.68 million (USD$8.7 million), showing a 20% year-on-year decline.

Rush Street observed a consistent and profitable growth trend in various casino markets, including Ontario, Colombia, and West Virginia through the first quarter. It was noted that in these markets, the company sequentially increased its estimated market share, indicating the success of its strategies. Richard Schwartz, the CEO of Rush Street Interactive, emphasized the pivotal role of online casinos in achieving the group’s long-term goals. He stated that those results support their view that online casinos are a key driver in achieving their long-term goals for them. Schwartz further mentioned that their business model and focus revolved around their profound understanding of online casino customers and their dedication to creating engaging and immersive experiences to retain them. He pointed out that their growth in the past year had been broad-based, encompassing both their eye casino and sport-only markets. Additionally, Schwartz highlighted that they had experienced revenue growth of over 100% in Latin America and North American markets launched after 2020, demonstrating an excellent quarter internationally.

Rush Street’s remarkable performance was notably bolstered by a 33% increase in gross gaming revenue (GGR) in Ontario compared to the previous quarter, contributing to sequential revenue growth of 38%. This growth was attributed to improved promotional efficiency. The company entered the regulated Canadian market in April 2022, with its subsidiary, BetRivers, launching its online casino and sportsbook platforms. To strengthen its presence in Ontario, Rush Street solidified its position through a partnership with Bragg Gaming, enabling the offering of a diverse selection of online gaming content.

CFO Kyle Sauers elaborated on the earnings report, emphasizing the company’s commitment to investing in markets with online casinos. He revealed that monthly active users in these markets experienced double-digit year-on-year growth. Additionally, he disclosed that the combined miles for the first quarter in the United States and Canada reached 147,000, indicating a 3% increase year-on-year, excluding New York due to the impact of last year’s launch in the state. When questioned about growth prospects during the earnings conference call, Sauers expressed optimism regarding the growth drivers in Ontario and Michigan. He mentioned that those markets should be nice growth drivers for them and added that there were opportunities to expand in several markets where they were currently active. However, he noted that it was worth mentioning that a few of the larger, more established markets, such as Pennsylvania, New Jersey, and Illinois, might offer a relatively lower growth profile that year.

Rush Street’s guidance suggests a projected annual revenue between $845.45 million (USD$630 million) and $939.39 million (USD$700 million) for the entire year, reflecting the company’s optimistic outlook for future performance.