Rivalry Secures $10M Strategic Investment; Reports Record Results in FY22
Rivalry, a globally recognised sports betting and media company, has announced a strategic investment of US$10 million (£8.04 million/€9.06 million) to accelerate growth and expand its market-leading position among digitally native consumers. This investment is led by Pinnacle, a global bookmaker, and other stakeholders in sports betting, technology, and payments.
Rivalry’s financial results for Q4/FY22 and preliminary Q1 have also been released. In 2022, Rivalry achieved triple-digit growth across all key metrics, with betting handle up by 198%, revenue up by 111%, and gross profit up by 349%. During this time, user registrations surpassed 1.5 million, more than doubling since 2021.
Preliminary Q1 results reveal an all-time high quarterly revenue of $12 million, an eight-fold increase YoY, with marketing expenses declining by 10% over Q1/22. This signifies the economic return of Rivalry’s product and brand strategy, pointing towards a continued trend towards profitability.
Rivalry has reported the expansion of its esports offering, which generated nearly 90% of sportsbook handle in 2022, with new titles and betting markets. The company has continued to develop its product, catering to its core audience of Millennial and Gen Z users, who accounted for 97% of active users in 2022. Rivalry has also deepened brand execution through esports and gaming-focused content and creator programming, building on its more than 100 brand partners.
The full-year 2022 financial highlights include a betting handle of $232.8 million, an increase of 198% compared to $78.2 million in 2021. Revenue was a record $26.6 million, an increase of 140% from $11.0 million in 2021, while gross profit was $9.8 million, an increase of $7.6 million or 349% from $2.2 million in 2021. Net loss for the year was $31.1 million, compared to a net loss of $24.3 million in 2021.
In the fourth quarter of 2022, betting handle was $83.9 million, a YoY increase of 237% compared to $24.9 million in Q4 2021, and up 19% sequentially from the previous record quarterly handle of $70.3 million in Q3 2022. Revenue was $9.4 million, a YoY increase of 338% from $2.2 million in Q4 2021, and represented the Company’s highest-ever revenue up to that point. Gross profit was $5.0 million, a YoY increase of $4.6 million from $0.4 million in Q4 2021, and up 139% sequentially from $2.1 million in Q3 2022.
Rivalry’s preliminary results for Q1 2023 show a betting handle of $120.2 million, an increase of $80.0 million or 199% from $40.2 million in Q1 2022. Revenue for Q1 2023 was $12.0 million, an increase of $7.2 million or 151% from $4.8 million in Q1 2022, and up $2.5 million or 27% over Q4 2022 revenue of $9.4 million. Gross profit was $5.4 million, an increase of $4.8 million from $0.7 million of gross profit in Q1 2022, and up $0.4 million or 9% from Q4 2022 gross profit of $5.0 million.
“Our market strategy and operational excellence continues to build upon consecutive record-setting quarters, driving a strong finish to the year and a robust Q1, while simultaneously demonstrating sequential narrowing losses on our path to profitability,” said Steven Salz, Co-Founder and CEO of Rivalry. “Underpinning our growth is significant brand loyalty among the Millennial and Gen Z audience and true product innovation in online betting, enabling every marketing dollar to go further, enhancing retention, and creating a distinctly unique platform. Rivalry continues to be economically rewarded for taking an inventive approach to the betting experience and tailoring it for a demographic with unique consumption habits.”
“We have reached an inflexion point in the business where the economic return of our strategy and unique position at the intersection of esports and betting has outlined a clear path to profitability,” Salz added. “We are well-positioned to scale efficiently throughout the year, with a collection of near and long-term initiatives that will contribute to our disruptive product and brand.”
Despite these impressive results, Rivalry was able to achieve them with a 10% reduction in marketing spend YoY. This highlights the company’s ability to generate economic returns from its product and brand strategy, while maintaining a trend towards profitability.
Rivalry’s continued success is largely driven by its focus on its core audience of Millennial and Gen Z users, who accounted for 97% of active users in 2022. The company’s strong esports offering, which generated nearly 90% of sportsbook handle in 2022, has been a key factor in attracting and retaining this core audience.
To further establish its market-leading position among digitally native consumers, Rivalry plans to expand its esports offering with new titles and betting markets. The company will also continue its product development and evolution, with a focus on deepening its brand execution through esports and gaming-focused content and creator programming.
In addition to its strong financial performance, Rivalry has also made significant strides in expanding its operations. The company obtained licenses in its first two fully regulated markets, commencing gaming operations in Ontario in April 2022 and in Australia in May 2022. The company has also expanded its casino offering with eight new titles, including live dealer and table games.
Looking ahead, Rivalry plans to expand its esports offering, deepen its interactive Casino.exe platform, and release additional proprietary and third-party games that cater to its core demographic.
The company will also focus on expanding its brand execution through premium content, creator partner programming, and community activations to enhance customer engagement and retention. With its strong financial performance and ambitious growth plans, Rivalry is well-positioned to continue leading the way in the competitive igaming industry.