eSports betting platform Rivalry has announced its financial results for the second quarter of 2023, showing an 86% increase in year-on-year gross profit to CA$3.8 million – but at the end had a net loss of CA$6, 3 millions.
Along with the increase in gross profit, the company reported a revenue increase of 60% to CA$8.5 million.
The company’s betting volume also increased to CA$112.2 million, up 192% year-on-year, while the average betting volume per customer increased by 63% over the same period.
Betting momentum looks set to continue into Q3, with CA$46.6 million in bets taken in July 2023, creating a single-month record; an increase of 99% over the previous year.
Rivalry also acquired 44% more new customers year-over-year, while marketing spend declined 6% over the same period.
However, despite the increase in revenue and gross profit, the company reported a net loss of CA$6.3 million, which is a 1% increase from the Q2 2022 net loss of CA$6, 2 million.
The company stated in its statement: “A select number of low probability esports and esports outcomes, coupled with behavioral betting habits unique to Gen Z users, caused increased margin volatility and negatively impacted revenue, which combined with several one-time expenses expanded the company’s net loss”.
Rivalry expects profit in the first half of 2024
Rivalry expects to reach profitability in the first half of next year, driven by “consistent revenue growth, cost efficiencies, continued efforts to create a bespoke product, and brand consolidation in Internet culture and gaming.”
Steven Salz, co-founder and CEO of Rivalry, commented, “In Q2, we had a nearly three-fold increase in handling year-over-year.”
“Increased marketing sophistication and enhancements to our core product have resulted in operational improvements, greater player pool share and a significant reduction in customer acquisition cost year-over-year, which positions us well for the coming quarters” .
“The growing strength of these underlying fundamentals continues to validate the Rivalry brand’s global leadership in esports betting and, more broadly, in delivering an online gaming experience to the next generation of fans,” added Salz.
