Rush Street Interactive, Inc.

Good day, ladies and gentlemen. Thank you for standing by. Welcome to the West Street Interactive Third Quarter 2025 earnings conference call. All participants are in a listen-only mode. A question and answer session will follow the formal presentation. Please note that this conference call is being recorded today, October 29th, 2025. I will now turn the call over to Kyle Fowler, President and Chief Financial Officer. Please go ahead.

Thank you, operator, and good afternoon. By now, everyone should have access to our third quarter 2025 earnings release. It can be found under the heading financials quarterly results in the investor section of the RSI website at RushStreetInteractive.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 condition. 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. We will 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 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 third quarter 2025 earnings release and our investor deck, which is available in the investor section of the RSI website at rustreinteractive.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. And with that, I'll turn the call over to Richard.

Thanks, Kyle. Good afternoon, and thank you for joining us today. I'm pleased to report on another outstanding quarter that underscores the resilience of our business model and player-first approach. Our third quarter results demonstrate continued momentum and acceleration of growth across key markets. led by our continued outperformance in the online casino space. Before diving into our key quarterly performance, I want to highlight some important organizational enhancements to strengthen our leadership structure. We promoted Kyle Sowers to President and CFO, expanding his existing role to now oversee marketing, operations, and commercial strategy, in addition to finances. This change allows me to focus more deeply on innovation, online casino legalization, and strategic growth opportunities, while Kyle drives cross-functional operational excellence across our existing markets. We've also elevated Rob Picard to Chief Strategy Officer, reflecting his contributions to our success. These changes position us well for continued execution as we scale our business. Congratulations to both Kyle and Rob. Now turning to our Q3 performance. Revenue reached a record $277.9 million, up 20% year over year, marking our 10th consecutive quarter of sequential revenue growth over the prior quarter. Notably, this growth was driven by very strong player acquisition and player engagement across our higher value markets. Adjusted EBITDA of $36 million increased 54% year over year, demonstrating the operating leverage inherent in our business model as we scale. In total for North America, our mouths increased 34% year over year, rising to 225,000. This represents our fastest quarterly user growth rate over four years and clearly off a much larger base of players. What makes these results particularly compelling is the continued acceleration of our growth in North American online casino markets, where we see the highest player value and retention. In our North American online casino markets, we deliver exceptional performance with 46% year-over-year malgrowth. This is also the second highest quarterly growth rate in over four years. Again, achieved off a much larger starting player base. Even more encouraging, we've seen accelerating year-over-year growth in our North American online casino player base every single month since March, indicating a strong underlying momentum that extends well beyond any seasonal factors. While this rapidly growing player base is driven by our high quality player experience and strong retention, we also had a record quarter as it relates to first-time depositors across the business. beating our prior high water mark by more than 10%, while doing so at very attractive customer acquisition rates. Turning to our performance in individual online casino markets, the breadth and scope of our success is encouraging. Delaware continued its noteworthy trajectory with 74% net revenue growth, demonstrating the sustained opportunity in this market, even as it continues to mature. Michigan delivered 48% growth, its second fastest pace since Q1 2022. Even our most mature market, New Jersey, achieved 37% growth, the second fastest rate since Q1 2021, proving that established markets can re-accelerate with the right strategy and execution. Ontario grew 24%, its fastest pace since Q4 2023. While Pennsylvania delivered 15% growth, it's fastest growth since Q3 2021. This broad-based acceleration of growth across markets of varying maturity levels validates our strategic approach of focusing on product differentiation and a high quality customer experience. Our proprietary technology platform enables us to deliver unique gaming experiences that drive both customer acquisition and retention efficiently. In Latin America, we continued to build momentum with MALS growing 30% year over year, climbing to a new record of 415,000 users. While Copa America in 2024 created a challenging year over year comparison in July, August and September both delivered over 50% growth, demonstrating the underlying strength of our LATAM operations extends well beyond major sporting events. Mexico revenue grew over 100% again this quarter, reflective of continued momentum and market share gains in that market. And in Colombia, while GGR again grew over 50%, net revenue was down 27% during the quarter due to player bonusing related to the temporary VAT tax. In Colombia, we continue to navigate the VAT tax environment. Our strategy of absorbing the tax impact while maintaining player experience has allowed us to grow our market position and continue to grow our player base at a fast pace. Our strong operational performance at Columbia positions us well for meaningful upside when normal tax conditions resume. As for the President's proposed 2026 tax reform, we continue to believe that Congress will not approve the proposed online gaming tax. Now I want to address several industry topics that I know are top of mind for investors. First, on prediction markets. We are monitoring this space closely. As a casino-first company, we see less direct competitive risk than sportsbook-heavy operators. In fact, if prediction markets create tax revenue erosion concerns for states, this could accelerate online casino legalization. that states seek more protected revenue streams, a development that would actually benefit RSI given a market-leading experience in online casino. The second industry topic is sweepstakes operators. The proliferation of unregulated sweepstakes products with games that look, feel, and play identical to regulated online casino games presents both a challenge and an opportunity. The reality is that this online casino gaming is already occurring across the United States through these unregulated and illicit channels. These operators generally pay no taxes are not subject to consumer protection or responsible gaming standards and often raise concerns about targeting minors. States are faced with a clear choice. Continue to allow this untaxed unregulated activity. or they can legalize online casino gaming and regulate it properly, ensuring strong and consistent consumer protections for the residents and generating meaningful tax revenue for their states. We believe the right choice is obvious and the sweepstakes proliferation only strengthens the case for regulated online casino expansion. Looking ahead, our pipeline of opportunities remains robust. We're excited about our planned expansion into Alberta and anticipate launching in that market on day one when it goes live. This represents a significant online casino opportunity that leverages our proven success in similar markets, such as Ontario, where we continue to hit new quarterly revenue records. We are also actively monitoring legislative developments across multiple US states or budget pressures and the need for new revenue sources are creating momentum for online casino legalization. As we look toward the remainder of 2025 and beyond, I'm confident in our strategic positioning. Our focus on markets that include online casino, our proprietary and innovative technology platform, our marketing efficiency, and our operational excellence create a sustainable competitive advantage that is difficult to replicate. The fundamentals of our business have never been stronger. We're growing fast, efficiently, and profitably. Most importantly, we're doing so in a way that positions us for continued success in online gaming markets across the Americas. With that, I'll turn the call over to Kyle for a more detailed financial commentary.