Genius Sports posts 22% revenue increase in Q2
Genius Sports posts 22% revenue increase in Q2

Genius Sports said growth in its sports betting technology, content and services division helped increase revenue by 22.1% year-on-year during the second quarter of 2023.

The data, technology and transmission businesses grew significantly in the period. However, it was the betting arm that recorded the most significant increase, with a 26.8% increase in revenue.

Genius attributed this to increased customer usage of event content. The provider also noted that renewed partnerships with key customers will help drive further growth.

In recent months, Genius Sports has extended a partnership with Football DataCo (FDC), which manages data rights for the English Premier League. It also renewed agreements with the National Football League and the XFL for indoor football.

“We entered the second half having reached a significant inflection point in our business,” said Genius co-founder and CEO Mark Locke.

“Following first-half financial performance and recently renewed partnerships with the FDC and NFL, we’ve validated our core strategy, differentiated our technology stack, and proven our sustainable business model.

Continued success in the second quarter perfectly demonstrates our balanced approach to delivering short-term results. It’s also accelerating Genius toward long-term growth and profit goals.”

Genius Sports Results – growth across all divisions

Group revenue for the three months to June 30 reached $86.8 million. This was up from $71.1 million in the same quarter last year.

The betting-related business generated $56.9 million in revenue in the second quarter. While media technology, content and services revenue increased 22.4% to $18.4 million, driven by growth in the Americas.

The company also posted a 3% increase in sports technology and services revenue, to $11.6 million.

With regard to second-quarter spending, cost of revenue increased 0.7% to $62.2 million. However, operating expenses were 33.7% lower to $32.5 million, primarily due to a 39.3% reduction in general and administrative expenses.

Genius Sports also noted some financial costs, but these were offset by a $1.5 million gain in foreign currency. Interest income reached $907,000 for the quarter.

Genius Sports net loss rises despite revenue growth

However, amid higher revenues and lower operating costs, the pre-tax loss jumped from $5.3 million to $6.9 million.

This occurred because last year the group recorded a much larger gain – US$ 30.1 million – in foreign currency.

The provider paid $4 million and also recorded a $588,000 gain on equity investments. That left a net loss of $10.3 million, up from $4.8 million a year earlier.

Genius Sports was, however, able to post an 87.2% increase in adjusted EBITDA to $15.7 million.

Lower net loss in the first half

Revenue in the six months to June 30th was US$184.1 million, an increase of 17.2% compared to the first half of 2022. Of this total, US$121.6 million came from betting activities, an increase of 28.6% in relation to the previous year.

Media business revenue rose 2.5% to $40.1 million, but sports revenue fell 4.3% to $22.4 million.

Revenue costs fell 8.2% to $149.9 million, while operating expenses fell 31.7% to $65.5 million.

Financial expenses totaled $852,000, versus a gain of $59.8 million in 2022 due to higher foreign currency earnings.

Genius Sports paid $4.6 million and also attracted $857,000 of equity investment. Net loss was $35.5 million but was less than $45.0 million in 2022 despite the impact of last year’s foreign currency gain.

For the 12 months to December 31, revenue is now expected to reach $410 million and adjusted EBITDA of $52 million. The amount is higher than previous guidance of $400 million and $49 million, respectively.