Rush Street Interactive, Inc.

I will now turn the call over to Kyle Sowers, Chief Financial Officer. Kyle, you may proceed.

Thank you, Operator, and good afternoon. By now, everyone should have access to our second quarter 2024 earnings release. It can be found under the heading Financials Quarterly Results in the Investors section of the RSI website at RushTreeInteractive.com. Some of our comments will be forward-looking statements within the meaning of the federal securities laws. Forward-looking statements are not statements of historical fact and are usually identified by the use of words such as will, expect, should, or other similar phrases and are subject to numerous risks and uncertainties that could cause actual results to differ materially from what we expect. We assume no responsibility for updating any forward-looking statements. Therefore, you should exercise caution in interpreting and relying on them. We refer you to our SEC filings for a more detailed discussion of the risks that could impact our future operating results and financial conditions. During the call, we will discuss our non-GAAP measures, which we believe can be useful in evaluating the company's operating performance. These measures should not be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP. In particular, we'll be discussing adjusted EBITDA, which we define as net income or loss before interest, income taxes, depreciation, and amortization, share-based compensation, adjustments for certain one-time or non-recurring items, and other adjustments that are either non-cash or are not related to our underlying business performance. A reconciliation of these non-GAAP measures to the most directly comparable GAAP measure is available in our second quarter 2024 earnings release and our investor deck, which is available in the investor section of the RSI website at RushStreetInteractive.com. For purposes of today's call, unless noted otherwise, when discussing profitability, EBITDA, or other income statement measures other than revenue, We're referring to those items on a non-GAAP adjusted EBITDA basis. With me on the call today, we have Richard Schwartz, Chief Executive Officer. We will first provide some opening remarks and then open the call to questions. With that, I'll turn the call over to Richard.

Thanks, Kyle. Good afternoon and welcome to our second quarter 2024 earnings call. Looking back at the past 12 months, our results have been a clear sign to us that our approach is working. We have consistently exceeded expectations, and this quarter is no exception. As we continue to innovate, grow, and deliver value to our customers, I remain confident that we are well on our way to achieving our goal of being a leader in online gaming across America. Second quarter revenue was $220 million, up 34% year over year, and EBITDA was $21.4 million, representing a 20 million improvement year over year. Both of these were quarterly records, and I'm very proud of our team for continuing to generate these excellent results. Consistent with trends from the last couple of quarters, we are adding new players to the platform faster, we are doing it more efficiently, and we are maintaining high player values by offering a differentiated experience that keeps players coming back time and again. All of this leads to solid top line growth and strong flow through to the bottom line. As we see in our recent quarterly results, we are continuing to post strong growth across both iCasino and sports, with iCasino revenue growing more than 40% year over year and online sports betting more than 25%. Underlying the growth is a solid mix of increasing player counts with improving player value trends that we attribute to our high quality and differentiated user experience that engages and retains players on our platform. For the second quarter, MAL growth in the United States and Canada was 24% year over year. This is the sixth consecutive quarter in which we have seen our year over year MAL growth in North America accelerate. In Latin America, rapid MAL growth continued during the second quarter, as we were up 79% year over year. It is noteworthy that this growth in users across our geographies did not come at the expense of player value. Specifically, we increased North American art MAL compared to last year by 6%, while Latin America art MAL was only modestly lower in the second quarter, despite the outsized MAL growth. With that overview, let's zoom into some key market highlights to provide added context on our results. We continue to diversify our revenue streams across markets. In Latin America and in U.S. and Canadian markets launched since 2021, revenue was up 75% year-over-year in the second quarter. And the percentage of revenues generated from markets outside of Illinois and Pennsylvania is now 59%. the highest experiences go in public. Our ability to deliver much higher growth in our more profitable markets continues to drive higher incremental profitability. On our last quarterly call, I shared that each of Michigan, New Jersey, and Pennsylvania had their highest levels of year-over-year revenue growth in over two years. This trend continued again as all three markets exhibited even higher growth during the second quarter. In fact, we had nine different markets with year-over-year online revenue growth rates of over 50%, again, demonstrating the breadth of our success in growing the business. In Delaware, our performance continues to progress nicely, achieving total GGR of over 37 million during the first half of the year. Our iCasino revenue during this period was more than four times what the previous operator had achieved, in the same prior year timeframe. Toward the end of the second quarter, we added live dealer on the iCasino side, and we're excited to have our first football season approaching on the Sportsbook side. We continue to steadily expand our customer base and remain very excited about where we see the opportunity progressing in Delaware. Certainly, our success has caught the attention of others in our industry who chose to bypass that Delaware RFP'd over a year ago. Many investors and analysts may be familiar with the recent lobbying and legislative efforts to alter the operating model that is delivering great results for the state. In the recently ended session, the proposed legislation was soundly defeated. The bill failed to advance to a floor vote in either the House or the Senate before the legislative session adjourned on June 30th. as it was clear that the current industry framework is delivering better outcomes for the state. We continue to maintain our focus on exceeding expectations in Delaware. Turning to our Latin American operations, we continue to experience great momentum. Revenue in the region grew 73% year-over-year, and as noted earlier, that growth was driven by the substantial year-over-year MAL growth. While the vast majority of this revenue growth comes from Colombia, in Mexico we continue to see solid growth and remain ahead of where we were at the same point in time post-launch to our start in Colombia. When it comes to marketing, we continue to refine our strategy and spend to target the highest value players and find them in unique ways. In the United States, we added a record number of first-time depositors to the platform for a second quarter. while at the same time having our lowest second quarter marketing expenses going public. This says a ton about our efficiency and the success of our marketing strategies and efforts, as it goes without saying that our cost of acquisition benefited significantly. In Latin America, we also added a record number of first-time depositors for our second quarter, beating our previous high by an impressive 71%. while at the same time reducing spend compared to that comparable quarter last year. To say it simply, we're spending less to acquire more customers, a result we're very proud of. We continue to use high-profile events to acquire new players. Benefiting the second quarter in Latin America, continuing momentum into the third quarter were the Copa America and Euro Cup soccer tournaments. our teams use this unique opportunity to bring on a significant number of new players, introducing them to the Rushbet brand and platform with a goal of retaining them for years to come. We have a similar opportunity around these Olympics in North America, and we've been strategic about picking up unique media assets to drive user growth that should benefit both our iCasino and sports betting verticals. On the new markets front, We continue to pursue and evaluate a variety of opportunities across the Americas. Let's begin in Canada. Many of you may have seen that since we last spoke, the Alberta legislator passed a bill that was a step forward in efforts to launch commercial online gaming and sports betting in that province. From our vantage point, the momentum is beginning to point to a near-term launch as being a real possibility. We will continue to monitor the opportunity at the province, according to the Canadian Gaming Association, has among the highest per capita spending on gaming in the country. This is a market that has great attributes, much like we've seen in other markets in North America. In Latin America, as we announced this week, we are now live in Peru with iCasino and online sports betting, marking the third country we've launched in Latin America. Peru is a market we are excited about. It is about two-thirds of the population of Colombia, with slightly higher GDP per capita. We believe we are well positioned for success there given the marketing adjacencies and overlap with Columbia, existing brand recognition, and the established teams in Latin America we will leverage. We're planning a modest launch period in Peru, so we don't expect a significant impact on either expenses or revenues in 2024. We look forward to discussing our progress there on future calls. Our evaluation in Brazil is ongoing. We are awaiting clarity on several items, including the tax framework and how the grain market will be treated post-regulation. Again, our strategy has been to maintain certain levels of fiscal discipline in all of our markets, both new and existing. Brazil will be no different. We will continue to provide updates as appropriate on our plans. Lastly, I will add there are other markets in LATAM that we continue to evaluate. And of course, we will provide updates on these markets when appropriate. With that, I'll turn the call over to Kyle.