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Rush Street Interactive, Inc. (RSI)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 delivered 21% year-over-year revenue growth to $262.4M and record Adjusted EBITDA of $33.2M, with North American iCasino markets leading and disciplined marketing driving leverage; full-year 2025 revenue ($1.01B–$1.08B) and Adjusted EBITDA ($115M–$135M) guidance was reiterated .
  • Gross margin expanded vs prior year to 34.9% (125 bps increase), reflecting revenue diversification and growth in more profitable markets; marketing spend was $38.8M (15% of revenue), indicating continued efficiency .
  • Management flagged temporary headwinds from Colombia’s 19% VAT on deposits, absorbing via higher bonusing to maintain share; upside to revenue/EBITDA if the tax is repealed sooner than year-end .
  • Near-term cadence: revenue likely lower in Q2 and Q3 than Q1, then strongest in Q4, driven by lapping Delaware launch and Colombia VAT timing; catalysts include poker multi-state liquidity expansion and product innovations (PropPacks) .

What Went Well and What Went Wrong

What Went Well

  • Record profitability: Adjusted EBITDA reached $33.2M (+95% YoY), with North American iCasino strength and disciplined spend supporting leverage .
  • Market-led growth: Michigan revenue up 40%, Delaware >80% YoY in first comparable quarter, New Jersey +27%; management emphasized innovation and player experience as the driver of momentum .
  • MAU growth and monetization: NA MAUs 203k (+17% YoY) with ARPMAU $368 (+3% YoY); LatAm MAUs 354k (+61% YoY) despite tax changes in Colombia .
  • Quote: “Our Adjusted EBITDA reached a record $33 million…driven by our commitment to innovation and enhancing the quality of our player experience, alongside efficient acquisition and retention of high-value players.” — Richard Schwartz, CEO .

What Went Wrong

  • Sportsbook headwinds: Player-friendly outcomes (Eagles Super Bowl, March Madness) pressured OSB hold despite product mix improvements .
  • Colombia VAT impact: Despite ~55% GGR growth in local currency, net revenue in March fell YoY and was flat in April due to higher bonusing; LatAm ARPMAU dropped to $36 vs $44 last year .
  • Guidance cadence: Mgmt highlighted revenue likely dipping in Q2/Q3 vs Q1 owing to full-quarter impact of Colombia VAT and tougher Delaware comps, moderating near-term top-line trajectory .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Millions)$232.1 $254.2 $262.4
Net Income attributable to RSI ($USD Millions)$1.190 $2.025 $5.319
Diluted EPS ($USD)$0.01 $0.02 $0.05
Adjusted EBITDA ($USD Millions)$23.393 $30.645 $33.226
Adjusted EPS ($USD)$0.05 $0.07 $0.09
Gross Profit Margin %N/A36.5% 34.9%
Adjusted Sales/Marketing ($USD Millions)$38.6 $43.1 $38.8
Marketing as % of RevenueN/A17% 15%

Segment breakdown (Q1 2025):

SegmentQ1 2025 YoY Growth
Online Casino Revenue Growth YoY25%
Online Sports Revenue Growth YoY11%

KPIs by region:

KPIQ3 2024Q4 2024Q1 2025
NA MAUs (000s)168 205 203
LatAm MAUs (000s)329 348 354
NA ARPMAU ($)$388 $346 $368
LatAm ARPMAU ($)$39 $39 $36

Balance sheet and capital actions:

  • Unrestricted cash: $228M; no debt .
  • Share repurchases: ~500k shares at $10.35 avg in-Q1; additional 234k at $10.55 post-quarter; $42M remaining under $50M authorization .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue ($USD)FY 2025$1,010–$1,080M (initiated 2/26/25) $1,010–$1,080M (reiterated 4/30/25) Maintained
Adjusted EBITDA ($USD)FY 2025$115–$135M (initiated 2/26/25) $115–$135M (reiterated 4/30/25) Maintained
AssumptionsFY 2025Only live jurisdictions; similar tax structures Same; ranges include Colombia VAT through year; upside if repealed earlier Clarified VAT timeline

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024)Previous Mentions (Q4 2024)Current Period (Q1 2025)Trend
Marketing leverageEmphasized efficiency as player growth accelerates Marketing at 17% of revenue; leverage improving Marketing 15% of revenue; continued leverage Improving leverage
Colombia VAT/regulatoryN/AEmergency decree; guidance includes VAT through year; potential upside if repealed Absorbing via bonusing; GGR +55% in local currency; NGR pressured; court timeline into late May/June Short-term headwind; potential upside
Delaware rampN/AReached >$125M GGR run rate in Q4; strong sequential growth +80% YoY Q1 revenue; growth to moderate as comps lap; long-term TAM opportunity Strong but normalizing
Sports hold/product mixN/AHold improved despite NFL outcomes; further mix-driven hold gains expected OSB +11% YoY despite March Madness/Eagles SB; continued SGP/props focus Improving product economics
iCasino momentumBroad-based growth across geographies/products iCasino and sports >27% growth; gross margin +200 bps YoY iCasino +25% YoY; NA states (MI/NJ/DE) strong Durable growth
Poker platformN/APA debut last Nov referenced externally (press) Multi-state network expansion (DE/MI/WV), planned NJ; cross-sell amenity Expanding liquidity

Management Commentary

  • Strategy and differentiation: “We continue to achieve strong results by prioritizing innovation and the quality of our player experience, while…acquisition and retention of high-value players.” — Richard Schwartz .
  • Colombia tax approach: “We have been absorbing the tax through higher bonusing rather than passing the cost on to our players…retain our market share, maintain strong player activity…albeit with lower NGR.” — Richard Schwartz .
  • Guidance cadence: “Revenue would be lower in Q2 and Q3 than…Q1 and then Q4 would be the largest revenue quarter of the year.” — Kyle Sauers .
  • Capital allocation: “We repurchased approximately 500,000 shares…leaving approximately $42 million remaining on our repurchase program.” — Kyle Sauers .

Q&A Highlights

  • Colombia VAT impact and share retention: Net revenue down slightly YoY in March and flat in April despite ~55% GGR growth; strategy aims to retain share via targeted bonusing and reduced deposit turnover .
  • Delaware trajectory and TAM: Growth to moderate as comps lap, but TAM could approach ~$300M GGR in a few years; continued strong execution .
  • Poker expansion: Multi-state liquidity enhances cross-sell; positioning poker as an amenity to drive casino/sports engagement, supported by brand ambassadors .
  • Sports hold/product mix: Continued improvements from parlays/props and merchandising; despite Q1 headwinds, margin structure trending better .
  • Guidance color: Assumes Colombia VAT through year; upside to revenue/EBITDA if repealed early; revenue cadence biased to Q4 .

Estimates Context

  • Wall Street consensus (S&P Global) for Q1 2025 EPS and revenue was unavailable via S&P Global at the time of this analysis; therefore, no beat/miss vs estimates can be determined for Q1 2025 [Values retrieved from S&P Global].
  • Given reiterated FY 2025 guidance and Q1 outperformance in North American iCasino, directional estimate revisions may skew modestly positive for FY EBITDA, with Colombia VAT path as the main variable .

Key Takeaways for Investors

  • Q1 momentum with record Adjusted EBITDA and strong NA iCasino execution supports confidence in reiterated FY 2025 guidance; leverage on marketing/G&A remains intact .
  • Colombia VAT is the primary near-term headwind to net revenue; court rulings by late May/June could unlock upside to FY revenue/EBITDA if VAT is curtailed sooner than expected .
  • Expect intra-year revenue cadence: softer Q2/Q3 vs Q1, then strongest Q4; trading setups around guidance reaffirmations and regulatory updates are likely catalysts .
  • Delaware remains a structural growth market (post-launch normalization), while Michigan and New Jersey continue to contribute meaningfully; portfolio diversification by state mitigates localized pressures .
  • Product-led improvements (SGP/props, PropPacks) and poker cross-sell expand hold and engagement, supporting margin trajectory in OSB and iCasino .
  • Balance sheet strength (no debt, $228M cash) and buyback capacity ($42M remaining) provide optionality for capital returns and selective M&A .
  • Monitor legalization momentum (e.g., Alberta Bill 48) and competitive tax dynamics; RSI’s focus on regulated markets and in-house tech positions it well for incremental market openings .

Other Relevant Press Releases (Q1 timing and subsequent catalysts)

  • Earnings call scheduling and access details (April 10) .
  • Product innovation—PropPacks expansion to MLB (May 29) .
  • Poker multi-state liquidity expansion (June 10), with NJ planned later in the year .