Rivalry will continue to focus on product development and innovation after recording its ‘most impressive’ quarterly results yet in Q1, the company informed its TSXV investors today.
Publishing Q1 trading results, Rivalry – operator of the Casino.exe platform and a flagship sportsbook and esportsbook product, and active in Canada and Australia – detailed revenue year-on-year revenue growth of 151% (Q1 2022: CA$4.8m) and sequential quarterly growth of 27% (Q4 2022: CA$9.4m) to CA$12m.
Although the company continued to operate at a loss, this was cut down by 50%, from $6.6m in Q1 2022 to $3.3m last quarter, as the firm edges towards profitability. Meanwhile, gross profit rose YoY 89% from Q1 2022 ($700,000) and QoQ 9% from Q4 ($5m) to $5.4m.
The company closes Q1 with $13.1m in cash and no debt, whilst also having raised $7.3m through a non-brokered private placement on 26 April 2023, after which it made a $10m investment in product innovation and development.
Moving into Q2 and Q3, Rivalry aims to maintain focus on development of both its flagship sportsbook/esportsbook product and Casino.exe in order to maintain an advantage in competitive markets.
Steven Salz, Rivalry Co-Founder and CEO, said: “Building innovative products, which add to an overall unique and interactive betting experience on Rivalry, will remain a strategic focus in 2023.
“The competitive advantage of engaging and fun products is increased user activity and satisfaction, and when combined with a profitable acquisition strategy, creates a flywheel effect in the business generating consistent organic momentum and enhancing our operational efficiency.”
On casino operations, Q1 marked a major milestone for Rivalry as it launched Casino.exe in Ontario, featuring eight casino games, including several titles exclusive to the province.
On a wider scale, sports betting and esports betting proved to be a key growth driver for the firm, with betting handle increasing 199% to $120.2m ($40.2m). As with revenue and profit, momentum in handle continued from 2022, rising 43% from $83.9m in Q4.
Salz remarked: “Our position at the intersection of esports and entertainment continues to create operating leverage in the business and drive organic growth as seen in our most impressive quarterly results to date.”
Finally, as with previous quarterly and full year trading updates, Rivalry attributed much of its success to an effective engagement strategy with Gen Z and millennial bettors.
Rivalry’s CEO has previously spoken about the company’s approach to marketing with SBC Leaders, outlining how the company places a heavy emphasis on using ‘creator’ or influencer partners and media properties.
In Q1, these partnerships and holdings reached a total of 85 million followers, bolstered by customer activations during ‘tentpole’ esports events, despite a 5% reduction in marketing costs. Meanwhile, user registrations grew 114% to 1.5 million, with Gen Z and millennials making up 97%.
Salz continued: “Rivalry’s content and brand strategy is setting the industry precedent for betting entertainment, allowing us to acquire customers profitably and engage them through authentic touchpoints without having to consistently deploy additional marketing and promotional spend for growth.
“And it is this approach that is generating breakthrough industry economics, user engagement, and charting a path to profitability for the Company that we are very bullish on.”