Rivalry revenue jumps 22% in Q3 2023 with gross profit soaring 90%

Rivalry has reported a record quarter after posting a 22% year-on-year (YoY) rise in Q3 revenue to C$8.7m (£5m). 

The figure represents a C$1.6m increase on Q3 2022’s revenue return of C$7.1m, while also delivering quarter-on-quarter revenue growth for the firm.

The operator noted the performance of its casino product offset the unseasonably low viewership of select esports events over the period.

In turn, this led to gross profit for the quarter amounting to C$4m, a 90% YoY increase on the C$2.1m recorded in Q3 2022. 

Betting handle during the reporting period increased 50% YoY, increasing from C$70.3m in 2022 to C$105.7m, with casino generating approximately half of total betting handle.

Rivalry pointed to the launch of several casino products in the quarter as reasons for the jump, including a custom-branded slots category, a new original game, Cash & Dash and the release of Casino.exe on its iOS app in Ontario. 

Elsewhere, the operator noted a “modest decline” in operating expenses, while there was a 6% YoY decline in net loss for Q3 2023, dropping from C$6m to C$5.6m.

As of 30 September 2023, Rivalry had C$7.4 million in cash and zero debt.

On the Q3 results, Steven Salz, co-founder and CEO of Rivalry, said: “We are proud to have delivered a record third quarter while exercising discipline on costs amid a challenging capital markets environment for growth companies.”

Following the conclusion of Q3, Rivalry strengthened its balance sheet via a private placement offering of C$14m, which will aid the firm in scaling several areas of the business, including marketing, product development and geographic expansion. 

Furthermore, the business has reiterated its target to be profitable by the end of H1 2024 and will also be conducting an investor day on 17 January 2024, in which management will discuss upcoming product innovations and growth initiatives. 

Salz added: “Now, with our recently announced capital infusion, we will be able to go back on the offensive while still maintaining our path to profitability.

“Years of consistent performance, flattened opex multiple quarters in a row, demonstrated triple-digit growth year-over-year across core metrics year-to-date with all-time high average handle per customer, average revenue per user and record low cost of customer acquisition over that same period gives me high conviction in Rivalry’s future.

“It is this proven operating leverage, supported by an improving sportsbook margin profile resulting in more revenue per dollar wagered, now fuelled by growth capital, that is creating a significant opportunity set for Rivalry. It is that combination which gives us confidence to reaffirm our first half 2024 profitability guidance.”