Sports betting and media company Rivalry has announced a set of very positive financial results for Q2 in 2023.
The figures, for the period ending June 30, 2023, project that the company should hit profitability within the first half of 2024.
Headline Figures of Rivalry’s Q2 Results
Some of the statement figures from the report are shown below:
- A 192% increase year-over-year in betting handle, which grew to $112.2m. That increase was generated despite a 6% reduction in marketing spend over the period.
- A 60% increase in revenue of up to $8.5m year-over-year.
- An 86% increase in gross profit, which grew to $3.8m year-over-year.
- Projections show that the company expects to reach profitability by the first half of 2024.
This growth has been achieved despite operational expenses remaining roughly the same over the year-on-year period and the marketing spending being reduced, as outlined above.
It is a healthy position for the TSXV-listed company that is based in Toronto, Canada and one which Rivalry Esports co-founder and CEO Steven Salz expanded upon in their press release.
“Validate Rivalry’s Global Brand Leadership”
Mr Salz stated:
“In Q2 we delivered a nearly three-fold increase in handle year-over-year.
Increased marketing sophistication and enhancements to our core product have led to operational improvements, increased player wallet share and a material year-over-year reduction in cost of customer acquisition, positioning us well in the coming quarters.
The growing strength in these underlying fundamentals continues to validate Rivalry’s global brand leadership in esports betting, and more broadly, in delivering a world class online gambling experience for the next generation of fans.”
Margin Volatility Negatively Impacted Revenue
However, Mr Salz also expanded upon how Gen Z and Millennial betting behaviour had negatively impacted revenue. Mr Salz explained:
“Our position among young Millenial and Gen Z customers represents one of our greatest competitive advantages, but has also presented unique learning regarding betting behaviours.
Generally we experience higher margin volatility within the sportsbook among this demographic, which impacted the revenue this quarter.”“
In the immediate term we have been tuning our operational initiatives to address normalizing margin and seeing early results. And to contextualize the upside potential of this work, at a constant industry average margins, Rivalry would have been profitable in Q1 and Q2 this year against the betting handle we generated.
With these ongoing adjustments being made based on our learnings, alongside the general benefits of scaling handle through growth provides to margin, we expect to reduce volatility, positively impacting bottom line results, and propelling us to profitability in the first half of next year.”
Rivalry has already earned a solid reputation as one of the best CSGO betting sites in the world and these new figures show that the company is starting to provide equally good returns for its shareholders and investors.
With a host of new developments ready for Q3 and the continuing development of its service for esports betting in Brazil, these positive results show Rivalry is on track for a positive and profitable future.
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