Rush Street Interactive surmounts adverse sporting results

David McKee

1 May 2025 at 11:31am UTC-4

Source: Shutterstock

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Despite the adversity posed by March Madness results and the Super Bowl, Rush Street Interactive posted almost uniformly improved numbers in its first-quarter-earnings call.

CEO Richard Schwartz led by citing 11% improvement in online sports betting revenue and 25% higher igaming receipts. “Domestically, we saw solid growth across the board,” he summarized.

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Internationally, revenue was 50% higher in Mexico and 55% in Colombia, the latter in spite of a 19% value-added tax imposed by the Colombian regime.

“We have been absorbing the tax through higher bonusing,” as opposed to passing it on to players, Schwartz explained. CFO Kyle Sauers added that higher costs in Colombia had been offset by improved performance in North America.

The Colombian government’s decree of a state of emergency, which led to the contingency tax, has not been renewed, the CEO emphasized, but has been partially upheld by the courts. The constitutionality of the tax itself is expected to be ruled upon in May or June.

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Asked how the emergency levy had affected player spending, Sauers said, “we’ve got a market that has been growing at 50% and now it’s about flat.” Schwartz added that presidential decrees have limited lifespans in Colombia and this one cannot be extended without congressional support, “which in the past has been absent.”

Staying south of the border, Schwartz reported that “we’re seeing a lot of great growth out of [Mexico]. It will be larger than Colombia ultimately” and is tracking ahead of where Colombia was at the same point in its maturity as a market.

By contrast, in Peru, Rush Street was said to be still optimizing the player experience and hasn’t ramped up its marketing yet. Stressing the potential of its territories, Rush Street boss Schwartz said that the company was not “moving faster than we need to.”

Schwartz also saw “exciting progress” in Alberta, where legalization of online sports betting and igaming is three-fifths of the way through the legislature. He expected digital gambling to be operational by 2026.

The CEO said the company was monitoring US legislative activity, and is counting on its previous success and economic challenges to create a compelling case for further igaming.

“We believe that igaming legislation will gain momentum in the coming years,” he continued.

Rush Street was described by its boss as “an attractive option for consumers, especially during challenging economic times.” He cited the affordability and ease of use of RSI’s product.

“We haven’t seen anything that is suggesting any changes in consumer behavior,” he added later, “but certainly there’s a lot of rhetoric.”

“Our player growth is faster in the high-value areas,” resumed Sauers. He said marketing dollars were being allocated primarily to higher-return markets and that he expected marketing spending to continue growing at a low rate throughout the year.

Of the Delaware market, Sauers said it had been “a great win for us. We’ll continue to see really nice growth. It’s logical that the growth rate will slow down but we feel there’s a long road ahead. This could be approaching a $300 million [gross gaming revenue] market in a few years.

Another Rush Street market, Pennsylvania, recently joined a multi-state compact to pool ipoker play. “We’re excited for the launch,” Schwartz said. “It was a successful launch for a poker platform, which is rare and hard to execute.”

Schwartz said Rush Street’s strategy is to treat ipoker as a gateway product, using it to cross-sell sports betting and igaming. He added that he was looking to expand that model further.

Toward the end of the earnings call, the topic of prediction markets arose.

“We’ve been very focused on our education on that market opportunity,” Schwartz said, adding “it’s something we’re very aware of” and that we would consider the opportunity should it present itself.

Rush Street ended the quarter with US$228 million cash on hand and no debt. It repurchased 500,000 shares of RSI stock at US$10 per share.