Genius beats guidance in Q1

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In the company’s Q1 report, Genius highlighted the performance compared to its guidance made during the three-month period ending 31 March.

The provider reported adjusted earnings before interest, tax, depreciation or amortisation (EBITDA) of $8.0m, a 166.7% increase compared to the $3.0m expected by the business.

The group also saw its net loss fall 37.4% from the $40.2m recorded by Genius in Q1 2022 to $25.2m. Genius made a loss before taxes of $24.8m, and faced an income tax $648,000.

Genius co-founder and CEO Mark Locke said following a year of strong execution in 2022, the business was “pleased” to continue its momentum in 2023.

“2023 is the year in which Genius expects to significantly accelerate group adjusted EBITDA profitability and rapidly expand margins,” he said. “Our first quarter results demonstrate the operating leverage of our business model, built to benefit from positive industry trends and support sustainable, profitable growth.

“As a result, I have a greater sense of confidence in our ability to achieve full-year financial targets beyond our initial expectations, leading us to raise our 2023 outlook.”

New customer acquisition drives betting growth

In Q1 2023, Genius achieved $97.2m in revenue, a 13.2% rise from the $85.9m the company reported the same period the previous year. This compares to the $92.0m the company forecast in its first quarter guidance.

The business’s Betting Technology, Content & Services division entirely drove the increased revenue, with the segment rising 30.2% to $64.7m versus the $49.7m reported in 2022.

The company’s other two verticals – Media Technology, Content & Services and Sports Technology & Services – both experienced revenue declines. Genius’s media business declined 9.8% from $24.1m, while its Sports segment fell a further 11.2% to $10.7m as opposed to the $12.1m the company reported in the same period the previous year.

The organisation said the increased revenue for its Betting segment was a result of the impact of both new customer acquisitions and growth among existing customers. Genius said that this was due to price hikes on contract renewals and renegotiations.

Meanwhile, lower advertising spends relative to Q1 2022 and the impacts of non-cash consideration contracts caused the respective declines in the business’s Media and Sports verticals.    

Reduction in costs and expenses

Genius’s report outlined wide reductions in the business’s operating expenses, which fell 34.3% from $49.6m in Q1 2022, to 32.6m in the first three-months of the year.

During the period, the business reported that its sales and marketing expenses fell from $9.2m to $7.4m. This reduction was mirrored in its declines for research and development which fell from $7.4m to $6.3m in 2023.

The business also reported that its general and administrative costs fell 44.8% from $32.8m to $18.1m. The company’s transaction expenses were the only costs which rose during the period, rising from $128,000 to $828,000 in the first quarter of 2023.    

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