Rush Street Interactive, Inc. Q4 FY2025 earnings call

• Richard Schwartz expressed gratitude to the team for an extraordinary year with record performance in 2025, including record revenue, adjusted EBITDA, and net income.
• Highlighted the casino-first strategy as a differentiator, with North American online casino markets driving growth. Success in navigating the tax environment in Colombia, with plans to increase investments in casino content and legalization efforts.
• Mentioned evaluation of prediction markets but focus on executing the casino-first strategy.
• Anticipated launch in Alberta and continued evaluation of expansion opportunities in North America and Latin America.

Fourth quarter revenue was $324.9 million, up 28% year-over-year. Full year 2025 revenue was $1.13 billion, up 23% year-over-year. Fourth quarter gross margins were 34.4%, full year 2025 gross margins were 34.6%. Fourth quarter adjusted EBITDA was $44.1 million, up 44% year-over-year. Full year adjusted EBITDA was $153.7 million, up 66% year-over-year. North American MAUs grew 37% year-over-year in Q4 to 278,000, with online casino markets growing 51% year-over-year. Latin America MAUs grew 47% year-over-year in Q4 to 493,000. Online casino revenues grew 30% in Q4 and 28% for full year. Online sports betting revenue grew 20% in Q4 and 7% for full year. North America revenue grew 29% in Q4 and 25% for full year. Latin America revenue grew 17% in Q4 and 12% for full year.

• 2026 revenue expected in range of $1.375 billion to $1.425 billion, growth of 21% to 26% year-over-year.
• 2026 adjusted EBITDA expected in range of $210 million to $230 million, growth of 37% to 50% year-over-year.
• Gross margins expected to improve modestly in 2026. Marketing spend expected to increase but at a slower rate than revenue growth. G&A expected to grow more closely in line with revenue growth.

• Dynamic tax environment in Colombia, including temporary tax decrees and their suspension, which could impact financial results.
• Competitive dynamics in the iGaming and sports betting markets that could affect market share and growth.

Q: Touch on Colombia's impact on revenue and EBITDA in 2025 and forecast for 2026.

A: Kyle Sauers provided details on incremental bonusing in 2025 and tax on revenue in 2026.

Q: On Alberta launch and Ontario iGaming/sports betting share.

A: Richard Schwartz said Alberta launch could be end of Q2/early Q3; Kyle Sauers mentioned casino share in Ontario is mid- to low single digits, sports is lower.

Q: Follow-up on Lat Am ARPU.

A: Kyle Sauers discussed currency fluctuations, Mexico's increasing significance, and bonusing impact.

Q: Investment in content and legalization.

A: Richard Schwartz talked about content studio, launching games, and legalization efforts.

Q: Illinois minimum bet change.

A: Kyle Sauers said minimum bet not specifically due to Chicago tax, could use in other markets.

Q: North America entrance comment.

A: Kyle Sauers clarified it's more about Alberta and other potential markets.

Q: Prediction market.

A: Richard Schwartz and Kyle Sauers discussed monitoring, cross-sell opportunities, and technology.

Q: North America MAU growth.

A: Kyle Sauers and Richard Schwartz discussed broad-based growth, acquisition channels, and customer service.

Q: Maine iGaming.

A: Richard Schwartz talked about Maine being an attractive market and potential skin agreement.

Q: Prediction market and TAM expansion.

A: Kyle Sauers and Richard Schwartz discussed share loss, TAM expansion, and product enhancements.

Q: MAU growth source.

A: Kyle Sauers said strength from online casino markets, where marketing efforts are focused.

Q: Sports betting hold and poker opportunity.

A: Kyle Sauers talked about hold growth and Richard Schwartz discussed poker journey and liquidity efforts.