Rivalry Corp.

Good morning, ladies and gentlemen, and welcome to the Rivalry Corp Q3 2022 results conference call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you need assistance, please press star zero for the operator. This call is being recorded on Tuesday, November 29, 2022. I would now like to turn the conference over to Jeff Cottis-Bode. Please go ahead.

Thank you, operator, and good morning, everyone. Our speakers on today's call will be Stephen Sells, co-founder and chief executive officer of Rivalry Corp, and Kit Okori, chief financial officer. Before we begin, I would like to remind listeners that certain statements made during this conference call presentation may constitute forward-looking information and forward-looking statements within the meaning of applicable securities laws. These statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of Rivalry Corp and its subsidiary entities or the industry in which it operates to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. When used in this conference call presentation, such statements use words such as may, will, expect, believe, plan, or other similar terminology. These statements reflect management's current expectations regarding future events and operating performance and speak only as of the date of this presentation. These statements involve known and unknown risks, uncertainties, and other factors, including those risk factors identified in the company's prospectus dated September 17th, 2021, under the heading risk factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. The company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, other than as required under securities legislation. And I'll now turn the call over to Stephen Saltz.

Stephen?

Thank you, Jeff, and thank you, everyone, for joining us. In Q3, we delivered a significant all-time record quarter, and in today's release, we also included our October results. net profit on a normalized basis. This is a huge milestone for rivalry and I'm incredibly proud of the entire team for their years of discipline execution and operational excellence, which got us here. And it's just the beginning. First on Q3. Betting handle was 70.3 million, up 203% year over year and 83% quarter over quarter. Revenue was 7.1 million, up 93% year over year and 35% quarter over quarter. and gross profit was 2.1 million, an increase of 263% year-over-year, while staying consistent with gross profit in Q2. As mentioned in prior quarters, Q3 has seasonally a stronger esports calendar than Q2, with a series of 10-pull international events. This year also saw the launch of our first-ever casino game during the quarter, which delivered immediate impact, contributing 30% of betting handle and 15% of revenue, despite little to no marketing efforts. Much of Rivalry's success is rooted in our ability to tap into the cultural zeitgeist of our audience, whose average age is 25, and the launch of Casino has been no different. Our casino platform, which we call Casino.exe, completely redefines the traditional casino betting experience and puts a thoughtful and entertaining spin on it using a visual expression that our community has a shared reverence for. Casino.exe allows customers to power on a vintage PC and engage with a variety of visual and functional features, including our retro operating system, desktop icons and wallpapers, a functional MP3 player, custom box art and more, all to create an interactive and entertaining experience for our users. This has allowed us to add it to our product suite and see immediate and material customer engagement without needing to deploy marketing spend, bonuses or promotions. This is true operating leverage and to us, this is the intrinsic strength and asset of our business as compared to the more traditional model utilized in our sector, which heavily relies on bonus and promotion to drive desired customer activity. It is worth noting that even without the contribution of Casino, Sportsbook alone would have delivered a record quarter, showing triple-digit year-over-year growth and nearly 30% quarter-over-quarter, demonstrating the healthy underlying growth profile in all core verticals of the company. Importantly, we extended our market leadership position among next-generation consumers, with 82% of active customers in the quarter being under the age of 30 years old. We continue to see significant opportunities and strength in esports betting. demonstrated by over 90% of our sportsbook handle being derived from esports in Q3. Now to our banner October. We put up a single month record betting handle of $37.2 million, a year-over-year increase of 190%, and nearly equaling all of Q2 alone. Revenue was $4.5 million, a year-over-year increase of 501%, and gross profit was $2.1 million. This gross profit figure in October equals that which we just delivered in Q3 and Q2, and resulted in the first ever profitable month in the company's history. The most critically evolved of these results and the substantive growth we've seen all year to get there has all been organic. We believe clearly demonstrates the inherent operating leverage in our business that we've spoken to all year. Delivering a clean net profit on a normalized basis is a promising validation of our overarching strategy, which prioritizes sustainable user economics first and scaling spend second. While October will likely set our high benchmark in 2022, As seasonally one of the strongest months of the year, seeing the League of Legends World Championship and Dota 2 the International, two Super Bowl equivalent events, and two of the three biggest esports in the world, today's results are more than just a seasonal spike. Our plus 20% month-over-month growth averaged over the past 12 months, successful casino product expansion, increasing market share ownership of esports betting, and the surgical execution of a number of big and small initiatives throughout the year are starting to bear fruit. And this should positively signal directionally as to where we are headed on underlying profitability in the future. Moving into November and December, we now have the World Cup. This is a universal sports fan moment globally that traditional sports fans and esports fans alike flock to, and one that we're well-positioned to capitalize on. Thus far, we have been encouraged by initial results. The combination of the World Cup and our casino offering is helping blunt the impact of the esports off-season, which runs from mid-November to early Jan. In prior years, despite a massive October, the esports off-season through the rest of the quarter results in Q4 being one of our quietest of the year. However, with current momentum, we expect to buck that trend. This also highlights one of the key values of casino. It reduces the impact of seasonality in esports, And in addition to that, it increases customer unit economics and offers more stable customer margin profile. I'll speak more to the incredible growth trajectory and outlook at Rivalry in my concluding statement. At this point, I would like to turn the call over to our CFO, Keita, to review our third quarter results in greater detail.

Keita?

Hey, Stephen. We reported very strong results in the third quarter across all our key metrics. Betting handle was 70.3 million, tripling Q3 of last year and up 83% sequentially from Q2 2022. We exceeded the previous record handle established in the first quarter of this year by 30 million. As we announced today, betting handle for October was 37.2 million, equivalent to 53% of our third quarter handle in just one month. Our entry into casino generated approximately 30% of the handle in Q3. That represents a big portion of the sequential growth we saw, but as Steven mentioned, even without Casino, we would have reported the record quarter. That growth was driven primarily by our strength in esports betting. Similar statements can be made about revenue. Casino accounted for 15% of our third quarter revenue of $7.1 million, but even absent that contribution, we would be reporting record revenue. In total, revenue increased by 93% year-over-year and by 35%, or $1.8 million, over Q2 2022. In October, revenue of $4.5 million was more than six times higher than a year ago and represented our best-ever single month. In addition to its impact on handle and revenue, our entry into the casino segment offers other important contributions to our financials. First, we expect it to help smooth out the seasonality we have historically seen in our business due to our heavy weighting in esports betting. The same can be said of any other source of betting activity, including traditional sports betting. As we continue to add increased product depth to rivalry, we will see less fluctuation over time from quarter to quarter. The addition of new revenue from the casino segment should help to normalize our margins, given the relative consistency of a casino product, as opposed to the inherent margin volatility in Sportsbook, which we've touched on in prior quarters. Gross profit in Q3 was $2.1 million, which was up significantly year-over-year and modestly above Q2 2022 gross profit. As a percentage of revenue, gross profit was 29% this quarter, compared to 39% in the second quarter of this year. As we said last quarter, that result was likely to be at the high end of the gross margin range we expect to achieve. We will continue to see variation from quarter to quarter due to the nature of our business model, which generates a spread or margin on betting handle. While we have generated sportsbook margins that are positive and generally trending upwards, the percentage can change from one period to the next. The addition of new products, such as casino, along with the overall growth of our business should help to narrow the range over time, increase in margin predictability. Interestingly, the $2.1 million of gross profit we generated in October has already equaled our gross profit for the entire third quarter. Turning now to operating expenses, in the third quarter, we were pleased to maintain key operating expense items relatively steady in comparison to Q2. The majority fall within three line items, marketing, advertising, and promotion. general and administration, and technology and content. On a percentage basis, each of these items was held to a low single-digit increase or even a slight decrease from the previous quarter. As we've stated since becoming publicly listed, our strategy has been to invest some of the proceeds of last year's capital raise in ramping up operations to support the expected growth in the business, which we've seen. Initially, those investments led to growth in operating expenses during the first half of the year, which we expected would cool off in the second half and can also be seen in the quarter. Results such as those we reported today help validate our approach. The staff we have added have been instrumental in expanding our reach both geographically and in terms of the products we offer. With the associated increases in handle and revenue, we achieved our first net profit in the month of October. As Stephen described, we anticipate that we will realize increased operating leverage in the coming quarters as revenue and gross profit continue to outpace expenses. This will be key to maintaining our balance sheet strength. We ended the third quarter with $23 million of cash resources, including cash and cash equivalents of $19 million plus restricted cash of $4 million. Restricted cash represents amounts that are contractually restricted and related to player deposits and player protection funds. With this level of liquidity and the operational improvements we've described, we remain very confident that we have the financial resources to continue to fund the company's growth. At this point, I'll turn the call back to Stephen to discuss our outlook.

Thank you, Keita. Since launching in the summer of 2018, Rivalry has prioritized esports and internet culture to gain a market-leading position and brand affinity with the next generation of bettors. This leadership position among millennial and Gen Z customers was a catalyst in driving these record results in Q3 and our banner October, and we'll continue to pay dividends as we scale. We believe that gaming fans, of which esports fans are a subset, are the key consumer of the future. 87% of Gen Z play video games weekly, and internet culture is now the defining culture and universally understood language for an entire generation of people. At nearly 40% of the world's population, under 30s, which represent the majority of Rivalry's customer base, are the largest generational cohort in history. As outlined at the start of the year in our 2021 letter to shareholders, we believe an intimate understanding of this audience will shape the next generation of great consumer products, betting or not. The common theme across winning products among this demographic is online communities wrapping entertainment around consumer experiences. It's with this understanding that we're able to innovate on product and build brand love at Rivalry. While we're able to build a brand that is serving an audience we believe legacy operators cannot. Rivalry is a tech-enabled company at its core, and this has allowed us to build our betting experience from scratch in-house and innovate on products along the way to ultimately redefine an online gaming experience for a generation of consumers that crave interactive and entertaining products. We have a game development team building games that more closely represent video game titles than typical casino games, Our in-house developed games include multiplayer, chat functions, and more to make the experience more social, as opposed to a traditionally siloed betting experience. As discussed in my opening remarks, we recently launched Casino.exe, a 90-skinned interactive casino platform to provide an elevated experience for our users and further differentiate us from our peers, both for original titles and third-party games that align with our brand principles. We also invest deeply in media, content, and community to drive engagement among our customers and acquire users. We pride ourselves on having a number of world-class creatives at the company, from designers to producers, which we leverage to create content globally for fans with an eye toward increasing our viral coefficient. We've created a Red Bull-esque partnership program that not only indicates a level of success for our creators and their respective markets, but supports them with our full suite of creative talent, resources, and reach. Our recent partnership announcement with a new rivalry influencer went viral, generating over 3 million views in 10 days. We have a variety of game and region-specific channels with hundreds of thousands of followers that tap into the passionate communities of esports and produce viral and localized content for them. We use this growing brand equity, engagement, and esports focus to differentiate ourselves in the market and power a unique customer acquisition strategy. As other sportsbooks scramble to shed big ticket bonuses and multi-billion dollar marketing spend in order to acquire customers profitably, Rivalry is building customer loyalty through true brand equity and a great product. Our perspective is that if bettors will only come to you for the latest promotion, then your only competitive advantage becomes your balance sheet. Bonusing is not the way to salvation in this industry. At Rivalry, we're leaning on brand equity, great original product, internet culture, and esports to create a brand that people love. And not only are we showing that esports is a valuable segment of the sports betting industry, but also a powerful top of funnel acquisition tool and gateway to a demographic of bettors under the age of 30 years old, as evidenced by our rapid success in the casino segment with almost $0 spent on marketing, bonuses, and promotion. Lastly, on the demo itself, it's important to note that Rivalry's customer activity has been unimpacted by the broader economic environment. Customer behavior and spend has remained consistent which is likely a nod to this younger skewing user base we serve, who tend to feel less affected by economic environments as they are less invested in the market, are less likely to have dependents, and so on. It is this demographic focus that has allowed us to continue going from strength to strength in 2022, and we believe we'll continue to do so into the foreseeable future. To wrap, we believe that with today's results, we have demonstrated on multiple fronts that our strategy has been working. We are extending leadership in esports betting, Esports is functioning as a top of funnel that is enabling us to successfully launch new products. We are seeing those products adopted rapidly due to the strength of our brand and a highly engaged customer base, and this is resulting in continuous record growth. And our deliberate and surgical approach has led to disciplined spending and capital allocation, as evidenced by the reduced burn this quarter in profitability in October. This is not a declaration of victory. We have a lot of hard work ahead of us, but we are proud of what we have delivered. After a year of doing these quarterly calls, I believe we have shown an ability to execute on the strategies we have set out to our investors, and we have more catalysts ahead. We just added additional casino games with more to come. Table games are expected in the coming months. We are putting the finishing touches on a mobile app for our regulated markets and are planning for another incredible year in 2023. For now, thank you, everyone, for tuning in. And at this time, I'll turn it over to the operator to open up the call for Q&A.

Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star, followed by the one on your touchtone phone. If you are using a speakerphone, please lift the handset before pressing any keys. First question comes from Adhira Katvi at 8 Capital. Please go ahead.

Hey, good morning, guys, and congrats on these results, just outstanding results here. I just wanted to talk about the Casino product, 30% of handle in the quarter, and so this is just ramping at an outstanding pace. Can you give us a sense of where these users have come from? Are they, like, new to the platform, or is it just cross-sell from your eSports offering? Just given the minimal marketing spend, just really good results. I just want to see where these users are coming from.

Yeah, for sure, and thanks, Dave, out here. it's still pretty early for casino. Like we, we basically saw it launched it right at the start of Q3. So at that press release in September, I think where we had really, you know, more officially pushed it out, everything was working and looking really good. So, you know, the, we're still kind of assessing the initial cohorts. What I can say is right now is we're, we're mostly just seeing crossover from our existing customers. And like the very early data that we're seeing is it's not cannibalizing sports book either. I mean, you can probably see that in the numbers, but it's a net increase in ARPU. So as we can really study the cohorts over a longer period of time, multiple quarters, see how they behave, all that kind of stuff, we'll get a better sense of it. But right now it looks to be the vast majority just cross all coming from our existing customer base. And the other thing that's interesting, and I'd say that we're like quite proud of, is the percentage of monthly. So it's 30% of handle, right? It also is about 30% of monthly active bettors. So it's like a one-to-one relationship. If you were to look at, I think almost anybody else in the sector, they'll usually have like, you know, 10% of their casino basis drives and like 80, 90% of the, of the handle the revenue. It's a very like VIP driven business. We have not seen that at all. Um, we have seen like a very clean, simple relationship where the percentage of handle in any given week and month is almost identical to the percentage of that may be as well. So we're also like pretty encouraged by just like the underlying, I'd say like house of like the behavior and activity.

Okay, good to see. So then as you kind of, will you kind of employ a similar approach where you're just going to learn about the market and then increase spend? Or are you encouraged enough by what you're already seeing that you can kind of increase the marketing spend on this product to really just like supercharge the growth?

Yeah, I think it all ties to like the inherent operating leverage in the model around how we acquire customers currently, which is quite heavy on social content and obviously our large universe of brand partners, 125 plus in all of our markets, where we can pretty much just like interchange assets or do activations at them at no cost. So I really mean this when I say like we have spent even still today in terms of like a net spend, let's say on marketing for casino closer to $0 than not. And we have no bonuses and promotions either associated with it. So we don't bonus people to, you know, to continue participating and playing the games either. So yeah, I think that's what we'll continue to do is we'll just leverage our existing channels to maybe lean into it a little heavier. Depending on the jurisdiction, certain games are more popular than others. We're expecting a lot in America, for example, that table games might be more popular than some of the current games. So we'll probably do a bit more on that and run some events and activations with our partners. So the whole kind of beauty of it is we don't always have to ramp up spend every time we do something new or create some new bonuses and promotions just to get people to participate in these games. And then in terms of the overall seasonality of The business now, as we mentioned in the script, Q4 is trending very strongly. I think even in the absence of the World Cup, just the introduction of casino would have created a lot more stability in our Q4. But what I think we'll see is because Q4 is seasonally the weakest overall for esports outside of October, my guess is as a percentage of handle and revenue, Q4 will probably index the highest to casino and then Q1, Q2, and Q3 will flip once they were you know, 70, 30 sports betting to casino handle this quarter and Q3 we just reported, you know, maybe it's a little more even sometime in Q4 and then Q1, Q2 and Q3, it flips again to being more heavily weighted toward casino. We'll see how it plays out, but that's kind of my gut is lower seasonal periods. We'll see heavier representation of casino, which I mean is really the point, right? So yeah, it's been, it's been great.

Excellent. So then, kind of just talking about the October results, is it fair to say that October was more skewed toward esports just with the League of Legends Worlds and Dota 2 International? Yeah. Okay, gotcha, gotcha. Yeah, yeah, yeah. So then... Okay. So then just on the back of that, I mean, obviously your margins are tracking really well here in October, especially the NGR margins, which have been higher than we've seen or as high as we've seen in the last couple of quarters. So is it fair to say that this is the model working as opposed to just operator favorable results? Like I said, just mainly looking at your NGR margins.

Yeah. Yeah. So October did have a slightly above average NGR margin, same average winning month. So the NGR margin was closer, I think to like five or five and a half percent versus, you know, let's say a four and a half percent, which would be more typical. So October wasn't significantly above average, but it was, you know, maybe a standard deviation above. So I wouldn't necessarily anticipate that, but generally casino has for sure increased overall margin stability. So the sports book is inherently volatile and, we are doing more and more handle on the sports book, but, you know, ultimately you still get a little more critical mass before we find stability there. Casino definitely is helping to anchor a more consistent NGR margin. So I would assume that it will start to pull more North of three, three and a half, 4%, as opposed to the first half of this year where it was, it was sub that figure. So that's what we're expecting. We're anticipating, which definitely has created a lot more underlying profitability and overall health in, in, in the business. So yeah, we're, we're obviously encouraged by October. Definitely.

Okay. Excellent. And then maybe just kind of taking a step back, thinking more broadly about the business, obviously casino, you said you were going to do it this year that came to fruition. Maybe just thinking about your priorities, where will you be focusing your efforts next year? Just with the casino product doing so well, do you think you'll be focusing more on that heading into next year? Or is it still going to be kind of focusing on both sports betting and the casino product?

Yeah, I think it's looking at just like the broader economic environment and obviously the demands and expectations of the market, which is skewing much more to profitability than it ever has. And growth at all costs is a model that is no longer really respected or regarded. And we've always been that way. I think we've talked about it on a lot of calls where this internal crawl, walk, run approach and being a lot more paced and measured and How we deploy capital is really like the story of rivalry and what used to look like maybe excess caution and patience is now looking prudent in the current market. So I think we'll continue to prioritize that at just like a very high level. Just continue to prioritize through the capital allocation, a desire for profitability without compromising growth and all the things that we've been doing up until this point. So that that'll be super key within the product. I would probably split it in half. Like we still think there's a huge amount of work we can do to enhance the quality And just the overall surprise and delight that you can find in a sports betting product. We just think there's way more to go in our traditional sports betting and our esports betting. And we are going to continue to lean heavily into that. I mean, just the other day we rolled out a pretty nice user experience overhaul to one of our primary betting pages that you find on every single match. And that's been great. So we're going to continue to add a lot of that and just like inject a lot of fun. Even I'm not sure if people have seen, we've got this cash out figure, cash out, sorry, feature that we call chicken out. which obviously is a bit of a play on the concept, but it's just humorous. You know, as you slide and toggle the value of your cash out, it's a little egg that increasingly hatches into a full chicken and then turns into like a chicken leg. Basically, if you're going to fully cash out, we just want to keep adding like these elements of just unique rivalry, equity, and IP into the product. And then the other half definitely is casino. So casino.exe is pretty novel. It's kind of quirky. There's a lot more we want to do with that. We want to be able to integrate it in these third-party games in a way that makes them a little more interesting than the typical iframe and here's a slot machine. And we've done that with casino.exe. So we're both going to continue to develop and build out that particular experience, like that product experience. And then we will add more third-party games. We're going to add table games, probably the next one. And we're going to keep developing original games in-house that all fit into that platform. So yeah. Yeah, it'll be a mix of both and then continuing with the overall approach of measuring and improving capital allocation while still giving the business oxygen to deliver growth.

Okay, great. And then last one for me, and I'll pass the line here. Just maybe on the newer markets, the regulated markets, Ontario and Australia, it's been kind of six months since you launched those. I know you take a more measured approach to those markets, but do you think you kind of have gathered enough data that heading into fiscal 2023 that you'd be kind of ramp up spending in those markets? Or how are those markets trending, just broadly speaking?

Yeah, Ontario and Australia are both trending somewhat similar. Maybe Ontario a little bit stronger than Australia, mostly to do with the fact that the Ontario product is, very, very similar to our global product. Whereas in Australia, it's a very different product. You can't have online casino. You can't have inflate bedding. It's just a very different experience for the customer that we're continuing to dial in. I'd say that we have seen continuous momentum and growth in those markets, but definitely within, again, the context of the broader market and the way that we need to be pretty measured with our balance sheet, we are not increasing spend significantly, I'd say, and we're going to continue just to nurture the esports betting market that we're finding in both places, which is a little smaller, a little more nascent than our global markets. And we're much happier doing, let's say a couple of million and handle a month that's profitable than trying to swing to the fence, swing to the fences, compete with the larger operators in the market on bonuses and promotions and just burn our balance sheet down for really no reason. So yeah, we're, we're just continuing to like tune our expectations. relative to the esports betting specific appetite in those markets, which is definitely a little bit smaller than some of our other markets, but not so much that we're overly disappointed. And again, our goal is to have those P&Ls profitable. And I think that's an expectation we have for next year, for sure, as we do in all of our markets. But no, certainly I don't think they're going to be just size-wise as big as some of our global markets that are just from a pure population size and younger demographic interest perspective are just minuscule. on eSports betting that we find in Ontario and Australia at this point. But, yeah, we'll continue to build and nurture them for sure.

Excellent. Well, congrats on the results, guys. Looks good. I'll pass the line.

Good.

Thank you. Next question comes from Suthan Sukumar at Stifel. Please go ahead.

Good morning, and congrats on a very strong quarter.

First question, I want to touch on casino. I think it's great to see early evidence of strong engagement and performance in this segment. How are you thinking of your investment priorities ahead for this segment? Is it more of a product development, more third-party titles, or is it more of a cross-sell marketing type of model that you're looking at going forward?

It's a bit of both, which is what we were doing. So it's, you know, there's like three pillars, right? It's developing casino.exe. If anyone's checked it out, it's, it is, you know, a bit of a bizarre and unique product experience. And the reason why we do that is we, we said this in the investor day, if you look at a typical casino integration, it's just an iframe in a, in a dump of, you know, a hundred plus slot machines, whatever it may be, just scrolling through picking Cleopatra slot here, whatever it may be. And if you load up any, app and you load, let's say Cleopatra, which is still one of the most popular slot machine. It's that game is built and owned by NetEnt, which is one of the large providers of slots. It's, it's literally the exact same game, right? I mean, if you load the Cleopatra slot on one operator versus another, you're loading the same game. And that is just what happens with third party games. And what we found internationally is the experience is pretty benign. They're just really, again, putting it in like a list of titles and you just pick it and off you go. And there's really nothing novel built around it. And then when that's the case, you have to ask yourself, what prompts the customer to play the net end Cleopatra slot on one operator versus another? There's only one thing, which is bonuses and promotion. We don't want to play that game or participate in that. So we're going to continue to build a very deep customer experience around engaging casino, how it interacts with our quest system, our broader sports book, and the overall rivalry experience. So this is super critical for us to continue to lean into. So that is definitely a big piece of it. And then we will continue to have third-party games because they do work. And also some of them, let's say table games, are very difficult to build, own, license, and operate yourself. It's just a lot. So it's just not something that even really makes sense. And then we'll continue to build our original games. So the original games take longer because we build them. We have to license them. We have to get them tested, all that kind of stuff. So the lead time is much longer. But it's unique and original IP to us. So It just adds, again, an additional flavor of why you should be participating in the casino segment, all the rivalries, the combination of all those experiences. And the objective always is to avoid having to subsidize the experience just to get the person on our site to play the game on our site versus somewhere else.

So everything we can do to achieve that is really the goal. Thanks for the color.

Secondly, I want to touch on your traditional sports betting business. not, can't recall if you, if you touched on this in the opening remarks, but what makes you handle this quarter was driven by traditional sports betting. And the second part to that is that, you know, has, has this segment been, been serving as a sort of user acquisition channel for, for your business or is the performance today more reflective of cross sell within your base?

It's definitely more reflective of cross sell. We do have some people coming in to bet on traditional sports, definitely with the world cup. Now we we've seen, pretty good results in the world cup, just because no matter your age, it is one of these fairly universal global events in Q3. It was about 10% or slightly under 10% of our sports betting handle with traditional sports, which I think we spoke to in the PR, at least we said 90% e-sports. So the difference is traditional sports. And then October, we were actually just about 10% in October. We were kind of surprised. So, you know, October was a massive e-sports month. We, We were a bit above 10% for traditional sports in October. So what we've said for a while is, like, if you look, I mean, the company's been growing at more than 20% on betting handle for over two years running. I think almost three years running now. And the last 12 months has been the same. And the whole pie has just been increasing at that rate. So we've seen traditional sports not really shrink. It's just kind of hovering in and around 10%. So in order to do that, it as well has been growing at, let's say, 20% on average every month. So the absolute dollar wagers in traditional sports is up significantly versus last year. But as a percentage of the pie, it's just kind of sitting around this 10-ish percent level. I do think still it is going to increase, but it's not something that we're You know, we don't particularly focus on going out to acquire traditional sports batteries. It's just a different business, I'd say, and a different game.

We're finding success in the way that we approach the market. Okay, great. Thanks for taking that question. I'll pass the line.

Thank you. There are no further questions. You may proceed.

Great. Thank you, everyone, for joining us on our third quarter result call, and we're happy to continue the discussion offline. If anyone has any additional questions, you know where to reach us, email, wherever.

Thank you. Thanks, everyone.

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating, and we ask that you please disconnect your lines.