Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): August 2, 2023

RUSH STREET INTERACTIVE, INC.

(Exact name of registrant as specified in its charter)


Delaware	001-39232	84-3626708
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

900 N. Michigan Avenue, Suite 950

Chicago, Illinois 60611

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (773) 893-5855

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:


o			Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o			Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o			Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o			Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading
Symbol(s)

Name of each exchange
on which registered

Class A common stock, par value $0.0001 per share

RSI

The New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company x

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Item 2.02 Results of Operations and Financial Condition.

On August 2, 2023, Rush Street Interactive, Inc. (the “Company”) issued a press release announcing the Company’s financial results for the quarter ended June 30, 2023.

A copy of the Company’s press release is attached hereto as Exhibit 99.1 and is hereby incorporated by reference in this Item 2.02. The information and exhibit contained in this Item 2.02 is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits


Exhibit No.						Description
99.1						Press Release, dated August 2 , 2023, reporting financial results for the second quarter ended June 30 , 2023.
104						Cover Page Interactive Data File (embedded within the Inline XBRL document).

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


	RUSH STREET INTERACTIVE, INC.

	By:	/s/ Kyle Sauers
		Name: Kyle Sauers
		Title: Chief Financial Officer

Dated: August 2, 2023

Exhibit 99.1

RUSH STREET INTERACTIVE ANNOUNCES SECOND QUARTER 2023 RESULTS

- Second Quarter Revenue of $165.1 Million, up 15% Year-over-Year -

- Achieved Adjusted EBITDA Profitability for the Quarter -

- Raising Full Year 2023 Revenue Guidance Midpoint with a Revised Range of between $650 and $690 Million -

CHICAGO – August 2, 2023 – Rush Street Interactive, Inc. (NYSE: RSI) (“RSI”), a leading online casino and sports betting company in the United States and the rest of the Americas, today announced financial results for the second quarter ended June 30, 2023.

Second Quarter 2023 Highlights

•Revenue was $165.1 million during the second quarter of 2023, an increase of 15%, compared to $143.7 million during the second quarter of 2022.

•Net loss was $16.7 million during the second quarter of 2023, compared to a net loss of $28.3 million during the second quarter of 2022.

•Adjusted EBITDA1 was a positive $1.2 million during the second quarter of 2023, compared to an Adjusted EBITDA loss of $18.6 million during the second quarter of 2022.

•Adjusted advertising and promotions expense1 was $40.4 million during the second quarter of 2023, compared to $44.2 million during the second quarter of 2022.

•Average Revenue per Monthly Active User (“ARPMAU”) in the United States and Canada was $359 during the second quarter of 2023, up 11% year-over-year.

•As of June 30, 2023, RSI had $128 million of unrestricted cash and cash equivalents

Richard Schwartz, Chief Executive Officer of RSI, said, “Through the first half of the year, the organization performed exceptionally well, achieving positive adjusted EBITDA ahead of schedule. This performance capped our strong first half with an adjusted EBITDA improvement of over $54 million compared to the first half of the prior year. This increase in profitability was mainly driven by operational improvements, as well as 15% revenue growth, led by strong growth in Colombia and markets that we launched after 2020.”

“We have built a fundamentally strong business with a firm foundation. Looking ahead, we are optimistic about our ability to innovate and continue to improve the quality of the user experience. With a solid financial position, a proprietary and scalable technology platform, and effective operational discipline, we are confident in our ability to continue executing successfully, positioning ourselves for further revenue and profitability growth in the future.”

Guidance

RSI expects revenue for the full year ending December 31, 2023 to be between $650 and $690 million, increasing the midpoint by $5 million compared to the previous guidance. At the midpoint of the range, revenue of $670 million represents 13% year-over-year growth when compared to $592 million of revenues for 2022.

1 This is a non-GAAP financial measure. Please see “Non-GAAP Financial Measures” for more information about this non-GAAP financial measure and “Reconciliations of GAAP to Non-GAAP Financial Measures” for a reconciliation of the most comparable measure calculated in accordance with GAAP to this non-GAAP financial measure.

This range is based on certain assumptions, including that (i) only operations in live jurisdictions as of today’s date are included, (ii) all professional and college sports calendars that have been announced come to fruition, including the completion of their 2023 seasons, and (iii) RSI continues to operate in markets in which it is live today, except for Connecticut.

Earnings Conference Call and Webcast Details

RSI will host a conference call and audio webcast today at 5:00 p.m. Eastern Time (4:00 p.m. Central Time), during which management will discuss second quarter results and provide commentary on business performance and its current outlook for 2023. A question-and-answer session will follow the prepared remarks.

The conference call may be accessed by dialing 1-844-200-6205 (Toll Free) or 1-646-904 5544 (Local) or, for international callers, 1-929-526-1599. The conference call access code is 027620.

A live audio webcast of the earnings conference call may be accessed on RSI’s website at ir.rushstreetinteractive.com, along with a copy of this press release and an investor slide presentation. The audio webcast and investor slide presentation will be available on RSI’s investor relations website until at least September 2, 2023.

About Rush Street Interactive

RSI is a trusted online gaming and sports entertainment company focused on markets in the United States, Canada and Latin America. Through its brands, BetRivers, PlaySugarHouse and RushBet, RSI was an early entrant in many regulated jurisdictions. It currently offers real-money mobile and online operations in fifteen U.S. states: Pennsylvania, Illinois, New Jersey, New York, Ohio, Connecticut, Michigan, Indiana, Virginia, Colorado, Maryland, Iowa, West Virginia, Arizona and Louisiana, as well as in the regulated international markets of Ontario, Canada, Colombia and Mexico. RSI offers, through its proprietary online gaming platform, some of the most popular online casino games and sports betting options in the United States. Founded in 2012 in Chicago by gaming industry veterans, RSI was named the 2023 EGR North America Awards Customer Services Operator of the Year, the 2022 EGR North America Awards Operator of the Year, Customer Services Operator of the Year and Social Gaming Operator of the Year, and the 2021 SBC Latinoamérica Awards Sportsbook Operator of the Year. RSI was the first U.S.-based online casino and sports betting operator to receive RG Check iGaming Accreditation from the Responsible Gaming Council. For more information, visit www.rushstreetinteractive.com.

Non-GAAP Financial Measures

In addition to providing financial measurements based on accounting principles generally accepted in the United States (“GAAP”), this press release includes certain financial measures that are not prepared in accordance with GAAP, including Adjusted EBITDA, Adjusted Operating Costs and Expenses, Adjusted Net Loss Per Share, Adjusted Net Loss and Adjusted Weighted Average Common Shares Outstanding, each of which is a non-GAAP performance measure that RSI uses to supplement its results presented in accordance with GAAP. A reconciliation of each such non-GAAP financial measure to the most directly comparable GAAP financial measure can be found below. RSI believes that presentation of these non-GAAP financial measures provides useful information to investors regarding RSI’s results of operations and operating performance, as they are similar to measures reported by its public competitors and are regularly used by securities analysts, institutional investors and other interested parties in analyzing operating performance and prospects. These non-GAAP financial measures are not intended to be considered in isolation or as a substitute for any GAAP financial measures and,

as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry.

RSI defines Adjusted EBITDA as net income (loss) before interest, income taxes, depreciation and amortization, share-based compensation, adjustments for certain one-time or non-recurring items and other adjustments. Adjusted EBITDA excludes certain expenses that are required in accordance with GAAP because certain expenses are either non-cash (i.e., depreciation and amortization, and share-based compensation) or are not related to our underlying business performance (i.e., interest income or expense).

RSI defines Adjusted Operating Costs and Expenses as RSI’s GAAP operating costs and expenses adjusted to exclude the impacts of share-based compensation, certain one-time or non-recurring items and other adjustments. Adjusted Operating Costs and Expenses excludes certain expenses that are required in accordance with GAAP because certain expenses are either non-cash (i.e., share-based compensation) or are not related to our underlying business performance.

RSI defines Adjusted Net Loss Per Share as Adjusted Net Loss divided by Adjusted Weighted Average Common Shares Outstanding. Adjusted Net Loss is defined as net loss attributable to Rush Street Interactive, Inc. as used in the diluted net loss per share calculation, adjusted for the reallocation of net loss attributable to non-controlling interests, share-based compensation, certain one-time or non-recurring items and other adjustments. Adjusted Weighted Average Common Shares Outstanding is defined as the weighted average number of common shares outstanding as used in the diluted net loss per share calculation, adjusted for the assumed conversion of the non-controlling interest’s Rush Street Interactive, LP Class A units to Class A common stock of RSI on a one-to-one-basis.

RSI includes these non-GAAP financial measures because management uses them to evaluate RSI’s core operating performance and trends and to make strategic decisions regarding the allocation of capital and new investments. Management believes that these non-GAAP financial measures provide investors with useful information on RSI’s past financial and operating performance, enable comparison of financial results from period-to-period where certain items may vary independent of business performance, and allow for greater transparency with respect to metrics used by RSI’s management in operating our business. Management also believes these non-GAAP financial measures are useful in evaluating our operating performance compared to that of other companies in our industry, as these metrics generally eliminate the effects of certain items that may vary from company to company for reasons unrelated to overall operating performance.

Key Metrics

RSI provides certain key metrics, including Monthly Active Users (“MAUs”) and ARPMAU, in this press release. RSI defines MAUs as the number of unique users per month who have placed at least one real-money bet across one or more of our online casino or online sports betting offerings, and it defines ARPMAU as average revenue for the applicable period divided by the average MAUs for the same period.

The numbers RSI uses to calculate MAUs and ARPMAU are based on internal RSI data. While these numbers are based on what RSI believes to be reasonable judgments and estimates of its customer base for the applicable period of measurement, there are inherent challenges in measuring usage and engagement with respect to RSI’s online offerings across its customer base. Such challenges and limitations may also affect RSI’s understanding of certain details of its business. In addition, RSI’s key metrics and related estimates, including the definitions and calculations of the same, may differ from estimates published by third parties or from similarly-

titled metrics of its competitors due to differences in operations, offerings, methodology and access to information. RSI regularly reviews, and may adjust its processes for calculating, its internal metrics to improve their accuracy.

Forward-Looking Statements

This press release includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. RSI's actual results may differ from their expectations, estimates and projections and consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as "expect," "estimate," "project," "budget," "forecast," "anticipate," "intend," "plan," "may," "will," "could," "should," "believes," "predicts," "potential," "continue," and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, statements regarding guidance, RSI’s future results of operations, financial condition or profitability, currency fluctuations, RSI’s strategic plans and focus, anticipated launches or withdrawals of RSI’s current or new offerings in existing or future jurisdictions, player growth and engagement, product initiatives and the objectives of management for future operations. These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Most of these factors are outside RSI's control and are difficult to predict. Factors that may cause such differences include, without limitation: changes in applicable laws or regulations; RSI’s ability to manage and sustain growth; RSI’s ability to execute its business plan, meet its projections and obtain relevant market access and/or gaming licenses; unanticipated product or service delays; general economic and market conditions impacting the demand for RSI’s products and services; economic and market conditions in the gaming, entertainment and leisure industry in the markets in which RSI operates; the potential adverse effects of general economic conditions, inflation rates and unemployment on RSI’s liquidity, operations and personnel; and other risks and uncertainties indicated from time to time in RSI's filings with the SEC. RSI cautions that the foregoing list of factors is not exclusive. RSI cautions readers not to place undue reliance upon any forward-looking statements, which speak only as of the date made. RSI does not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based, except as required by law.

Media Contacts:

Lisa Johnson

(609) 788-8548

lisa@lisajohnsoncommunications.com

Investor Contact:

ir@rushstreetinteractive.com

Rush Street Interactive, Inc.

Condensed Consolidated Statements of Operations

(Unaudited and in thousands, except per share data)


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
	(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)
Revenue	$	165,062	$	143,736	$	327,423	$	278,674

Operating costs and expenses
Costs of revenue	109,853		104,882		217,007		204,740
Advertising and promotions	40,965		44,742		90,905		111,591
General administration and other	20,558		16,610		42,150		32,150
Depreciation and amortization	7,988		3,290		13,743		6,027
Total operating costs and expenses	179,364		169,524		363,805		354,508
Loss from operations	(14,302)		(25,788)		(36,382)		(75,834)

Other income (expenses)
Interest income (expense), net	288		(223)		668		(445)
Loss before income taxes	(14,014)		(26,011)		(35,714)		(76,279)

Income tax expense	2,720		2,335		5,520		4,337
Net Loss	$	(16,734)	$	(28,346)	$	(41,234)	$	(80,616)

Net loss attributable to non-controlling interests	(11,595)		(20,014)		(28,835)		(57,587)
Net loss attributable to Rush Street Interactive, Inc.	$	(5,139)	$	(8,332)	$	(12,399)	$	(23,029)

Net loss per common share attributable to Rush Street Interactive, Inc. – basic and diluted	$	(0.08)	$	(0.13)	$	(0.19)	$	(0.37)
Weighted average common shares outstanding – basic and diluted	67,389,454		63,976,146		66,330,641		62,889,746

Rush Street Interactive, Inc.

Condensed Consolidated Statements of Comprehensive Loss

(Unaudited and in thousands)


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
	(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)
Net loss	$	(16,734)	$	(28,346)	$	(41,234)	$	(80,616)

Other comprehensive loss
Foreign currency translation adjustment	1,626		(1,923)		1,970		(409)
Comprehensive loss	$	(15,108)	$	(30,269)	$	(39,264)	$	(81,025)

Comprehensive loss attributable to non-controlling interests	(10,463)		(21,378)		(27,460)		(57,863)
Comprehensive loss attributable to Rush Street Interactive, Inc.	$	(4,645)	$	(8,891)	$	(11,804)	$	(23,162)

Rush Street Interactive, Inc.

Reconciliations of GAAP to Non-GAAP Financial Measures

(Unaudited and in thousands)

Adjusted EBITDA:


	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2023		2022		2023		2022
Net loss	$	(16,734)	$	(28,346)	$	(41,234)	$	(80,616)

Interest (income) expense, net	(288)		223		(668)		445
Income tax expense	2,720		2,335		5,520		4,337
Depreciation and amortization	7,988		3,290		13,743		6,027
Share-based compensation expense	7,518		3,880		15,193		7,817
Adjusted EBITDA	$	1,204	$	(18,618)	$	(7,446)	$	(61,990)

Adjusted Operating Costs and Expenses:


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
GAAP operating costs and expenses:
Costs of revenue	$	109,853	$	104,882	$	217,007	$	204,740
Advertising and promotions	40,965		44,742		90,905		111,591
General administration and other	20,558		16,610		42,150		32,150
Depreciation and amortization	7,988		3,290		13,743		6,027
Total operating costs and expenses	$	179,364	$	169,524	$	363,805	$	354,508

Non-GAAP operating cost and expense adjustments:
Costs of revenue1	$	(269)	$	(246)	$	(526)	$	(490)
Advertising and promotions1	(559)		(511)		(1,095)		(1,016)
General administration and other1	(6,690)		(3,123)		(13,572)		(6,311)
Depreciation and amortization	—		—		—		—
Total non-GAAP operating cost and expense adjustments	$	(7,518)	$	(3,880)	$	(15,193)	$	(7,817)

Adjusted operating costs and expenses:
Costs of revenue	$	109,584	$	104,636	$	216,481	$	204,250
Advertising and promotions	40,406		44,231		89,810		110,575
General administration and other	13,868		13,487		28,578		25,839
Depreciation and amortization	7,988		3,290		13,743		6,027
Total adjusted operating costs and expenses	$	171,846	$	165,644	$	348,612	$	346,691

1Non-GAAP Operating Costs and Expense Adjustments include Share-based compensation expense.

Rush Street Interactive, Inc.

Reconciliations of GAAP to Non-GAAP Financial Measures

(Unaudited and in thousands, except share and per share data)

Adjusted Net Loss, Adjusted Weighted Average Common Shares Outstanding and Adjusted Net Loss Per Share:


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Adjusted Net Loss
Net loss attributable to Rush Street Interactive, Inc. – basic and diluted	$	(5,139)	$	(8,332)	$	(12,399)	$	(23,029)
Adjustments:
Net loss attributable to non-controlling interests	(11,595)		(20,014)		(28,835)		(57,587)
Share-based compensation expense	7,518		3,880		15,193		7,817
Adjusted Net Loss	$	(9,216)	$	(24,466)	$	(26,041)	$	(72,799)

Adjusted Weighted Average Common Shares Outstanding
Weighted average common shares outstanding – basic and diluted	67,389,454		63,976,146		66,330,641		62,889,746
Adjustments:
Conversion of weighted average RSILP Units to Class A Common Shares	154,453,141		156,004,353		155,150,489		157,011,313
Adjusted Weighted Average Common Shares Outstanding	221,842,595		219,980,499		221,481,130		219,901,059

Net loss per common share attributable to Rush Street Interactive, Inc. – basic and diluted:	$	(0.08)	$	(0.13)	$	(0.19)	$	(0.37)
Adjusted Net Loss per Share	$	(0.04)	$	(0.11)	$	(0.12)	$	(0.33)

Cover	Aug. 02, 2023
Cover [Abstract]
Document Type	8-K
Document Period End Date	Aug. 02, 2023
Entity Registrant Name	RUSH STREET INTERACTIVE, INC.
Entity Incorporation, State or Country Code	DE
Entity File Number	001-39232
Entity Tax Identification Number	84-3626708
Entity Address, Address Line One	900 N. Michigan Avenue
Entity Address, Address Line Two	Suite 950
Entity Address, City or Town	Chicago
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	60611
City Area Code	773
Local Phone Number	893-5855
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Class A common stock, par value $0.0001 per share
Trading Symbol	RSI
Security Exchange Name	NYSE
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Central Index Key	0001793659
Amendment Flag	false