Rush Street Interactive, Inc.

Previous wording

Our real-money online casino and online sports betting offerings are currently provided under our BetRivers and PlaySugarHouse brands in the United States and Canada and under our RushBet brand in Latin America (which includes Mexico). We operate and/or support retail sports betting for our bricks-and-mortar partners under our brands or our partners’ respective brands depending on the terms of our arrangement. Many of our social gaming offerings are marketed under our own brands, although we also offer social gaming under our partners’ brands as well. Our decision about what brand or brands to use is market and/or partner specific, and is based on brand awareness, market research, marketing efficiency, contractual obligations and applicable gaming rules and regulations.

Current wording

Our real-money online casino and online sports betting offerings are currently provided under our BetRivers and PlaySugarHouse brands in the United States and Canada and under our RushBet brand in Latin America (which includes Mexico). We operate and/or support retail sports betting for our bricks-and-mortar partners under our brands or their respective brands depending on the terms of our arrangement. Many of our social gaming offerings are marketed under our own brands, although we also offer social gaming under our partners’ brands as well. Our decision about what brand or brands to use is market and/or partner specific, and is based on brand awareness, market research, marketing efficiency, contractual obligations and applicable gaming rules and regulations.

Previous wording

The chart below presents our average MAUs in the United States and Canada for the three months ended March 31, 2025 and 2024:

Current wording

The chart below presents our average MAUs in the United States and Canada for the six months ended June 30, 2025 and 2024:

Previous wording

The chart below presents our average MAUs in Latin America (including Mexico) for the three months ended March 31, 2025 and 2024:

Current wording

The chart below presents our average MAUs in Latin America (including Mexico) for the six months ended June 30, 2025 and 2024:

Previous wording

The chart below presents our ARPMAU in the United States and Canada for the three months ended March 31, 2025 and 2024:

Current wording

The chart below presents our ARPMAU in the United States and Canada for the six months ended June 30, 2025 and 2024:

Previous wording

The year-over-year increase in ARPMAU in the United States and Canada was mainly due to our continued growth in markets where we offer online casino in addition to online sports betting, the impact of our strategic advertising and marketing efforts in other markets where offer online casino, and our focus on retaining quality players.

Current wording

The year-over-year increase in ARPMAU in the United States and Canada was mainly due to our continued growth in markets where we offer online casino in addition to online sports betting, the impact of our strategic advertising and marketing efforts, and our focus on retaining quality players.

Previous wording

The chart below presents our ARPMAU in Latin America (including Mexico) for the three months ended March 31, 2025 and 2024:

Current wording

The chart below presents our ARPMAU in Latin America (including Mexico) for the six months ended June 30, 2025 and 2024:

Previous wording

The year-over-year decrease in ARPMAU in Latin America was mainly driven by the negative impact of additional player bonusing as a result of the value-added tax imposed on customer deposits in Colombia, which became effective during the three months ended March 31, 2025, and unfavorable foreign exchange rate fluctuations.

Current wording

The year-over-year decrease in ARPMAU in Latin America was mainly driven by the negative impact of additional player bonusing as a result of the value-added tax imposed on customer deposits in Colombia, which became effective during the six months ended June 30, 2025, and unfavorable foreign exchange rate fluctuations.

Previous wording

Costs of Revenue. Costs of revenue increased by $26.4 million, or 18%, to $170.9 million for the three months ended March 31, 2025 as compared to $144.5 million for the same period in 2024. The increase was mainly due to and directly correlated with our expansion and continued growth as noted above. Market access costs, gaming taxes, payment processing costs and operating expenses contributed $11.0 million, $8.6 million, $4.3 million and $2.3 million, respectively, to the period-over-period increase in costs of revenue. Personnel costs contributed to the remainder of the period-over-period increase. Costs of revenue as a percentage of revenue decreased to 65% for the three months ended March 31, 2025 as compared to 66% for the same period in 2024.

Current wording

Costs of Revenue. Costs of revenue increased by $29.7 million, or 21%, to $174.1 million for the three months ended June 30, 2025 as compared to $144.5 million for the same period in 2024. The increase was mainly due to and directly correlated with our expansion and continued growth as noted above. Gaming taxes, market access costs, payment processing costs and operating expenses contributed $13.1 million, $7.8 million, $4.2 million and $4.2 million, respectively, to the period-over-period increase in costs of revenue. Personnel costs contributed to the remainder of the period-over-period increase. Costs of revenue as a percentage of revenue decreased to 65% for the three months ended June 30, 2025 as compared to 66% for the same period in 2024.

Previous wording

Sales and Marketing. Sales and marketing expense increased by $3.7 million, or 10%, to $42.1 million for the three months ended March 31, 2025 as compared to $38.4 million for the same period in 2024. The increase was primarily driven by higher marketing personnel costs and share-based compensation expense. Sales and marketing expense as a percentage of revenue decreased to 16% for the three months ended March 31, 2025 as compared to 18% for the same period in 2024.

Current wording

Sales and Marketing. Sales and marketing expense increased by $0.2 million, or 1%, to $37.1 million for the three months ended June 30, 2025 as compared to $36.9 million for the same period in 2024. The increase was primarily driven by higher marketing personnel costs and share-based compensation expense, which was partially offset by reduced marketing spend resulting from management’s strategy to rationalize marketing spend as the North American and Latin American online gaming industries continue to mature. Sales and marketing expense as a percentage of revenue decreased to 14% for the three months ended June 30, 2025 as compared to 17% for the same period in 2024.

Previous wording

General and Administrative. General and administrative expense decreased by $0.6 million, or 2%, to $25.3 million for the three months ended March 31, 2025 as compared to $25.9 million for the same period in 2024. The decrease was primarily due to lower share-based compensation expense and other administrative costs. General and administrative expense as a percentage of revenue decreased to 10% for the three months ended March 31, 2025 as compared to 12% for the same period in 2024.

Current wording

General and Administrative. General and administrative expense decreased by $3.4 million, or 13%, to $23.8 million for the three months ended June 30, 2025 as compared to $27.2 million for the same period in 2024. The decrease was primarily due to lower share-based compensation expense and other administrative costs. General and administrative expense as a percentage of revenue decreased to 9% for the three months ended June 30, 2025 as compared to 12% for the same period in 2024.

Previous wording

Depreciation and Amortization. Depreciation and amortization expense increased by $2.4 million, or 34%, to $9.5 million for the three months ended March 31, 2025 as compared to $7.1 million for the same period in 2024. The increase was mainly due to additional costs to acquire internally developed software and other definite-lived intangible assets. Depreciation and amortization expense as a percentage of revenue increased to 4% for the three months ended March 31, 2025 as compared to 3% for the same period in 2024.

Current wording

Depreciation and Amortization. Depreciation and amortization expense increased by $2.3 million, or 30%, to $9.8 million for the three months ended June 30, 2025 as compared to $7.6 million for the same period in 2024. The increase was mainly due to additional costs to acquire internally developed software and other definite-lived intangible assets. Depreciation and amortization expense as a percentage of revenue increased to 4% for the three months ended June 30, 2025 as compared to 3% for the same period in 2024.

Previous wording

Interest Income, Net. Interest income, net, increased by $0.1 million, or 9%, to $1.7 million for the three months ended March 31, 2025 as compared to $1.6 million for the same period in 2024. The increase in interest income was mainly attributed to higher amounts of cash held in interest-bearing accounts and money market funds as compared to the same period in 2024.

Current wording

Interest Income, Net. Interest income, net, increased by $0.3 million, or 14%, to $2.2 million for the three months ended June 30, 2025 as compared to $1.9 million for the same period in 2024. The increase in interest income was mainly attributed to higher amounts of cash held in interest-bearing accounts and money market funds as compared to the same period in 2024.

Previous wording

Revenue. Revenue increased by $45.0 million, or 21%, to $262.4 million for the three months ended March 31, 2025 as compared to $217.4 million for the same period in 2024. The increase was mainly due to and directly correlated with our continued growth across existing markets and expansion into the new markets, such as Peru. The increase reflects higher period-over-period online casino and sports betting revenue and social gaming revenue of $45.3 million and $0.1 million, respectively, which was partly offset by a decrease in retail sports betting revenue of $0.4 million.

Current wording

Revenue. Revenue increased by $93.8 million, or 21%, to $531.6 million for the six months ended June 30, 2025 as compared to $437.8 million for the same period in 2024. The increase was mainly due to and directly correlated with our continued growth across existing markets and expansion into new markets, which launched late in the second quarter of 2024. The increase reflects higher period-over-period online casino and sports betting revenue of $93.9 million and social gaming revenue of $0.3 million, which was partially offset by a decrease of retail sports betting revenue of $0.4 million.

Previous wording

Our online sports betting and retail sports betting operations experience seasonality based on the relative popularity and frequency of certain sporting events. Although sporting events occur throughout the year, our online sports betting customers are most active during the NFL, NBA, college football and basketball seasons. With respect to our online sports betting and retail sports betting operations, customer activity tends to increase, and we may experience increased volatility, in connection with major sporting events such as the NFL super bowl, the NBA finals and NCAA basketball March Madness. In addition, sports betting activity is impacted by the occurrence of periodic events (e.g., Copa América, UEFA, Olympics).

Current wording

Our online and retail sports betting operations experience seasonality based on the relative popularity and frequency of certain sporting events. Although sporting events occur throughout the year, our online sports betting customers are most active during the NFL, NBA, college football and basketball seasons. With respect to our online and retail sports betting operations, customer activity tends to increase, and we may experience increased volatility, in connection with major sporting events such as the NFL super bowl, the NBA finals and NCAA basketball March Madness. In addition, sports betting activity is impacted by the occurrence of periodic events (e.g., World Cup, Copa América, UEFA, Olympics).

Previous wording

We had $228.2 million in cash and cash equivalents as of March 31, 2025 (excluding legally restricted customer cash deposits, which we segregate from our operating cash balances). We intend to continue to finance our operations without third-party debt and entirely from operating cash flows and cash on our balance sheet.

Current wording

As of June 30, 2025, we had $240.6 million in cash and cash equivalents, excluding legally restricted customer cash deposits that we segregate from our operating cash balances. We intend to continue to finance our operations without third-party debt and entirely from operating cash flows and cash on our balance sheet.

Previous wording

We expect our material cash requirements during the upcoming 12-month period to include $11.2 million of non-cancellable purchase obligations with marketing vendors, $4.3 million of license and market access fees, and $2.4 million of lease payments. In addition, we will continue to pursue expansion into new markets, which is expected to require significant capital investments. We have $36.2 million of additional non-cancellable purchase obligations including obligations for license and market access fees, arrangements with marketing vendors and lease payments subsequent to the upcoming 12-month period. See Note 13 to our unaudited condensed consolidated financial statements included elsewhere in this Report. Management believes our current cash holdings and, if necessary or desirable, various avenues available to pursue funding in the capital markets will suffice to fund these obligations.

Current wording

Our current working capital needs relate mainly to supporting our existing businesses, the growth of these businesses in their existing markets and their expansion into other geographic regions, as well as our personnel’s compensation and benefits. We expect our material cash requirements during the upcoming 12-month period to include $10.9 million of non-cancellable purchase obligations with marketing vendors, $4.3 million of minimum license and market access fees, and $2.6 million of lease payments. We also have $35.0 million of additional non-cancellable purchase obligations that will be due subsequent to the upcoming 12-month period. In addition, we will continue to pursue expansion into new markets, which is expected to require significant capital investments.

Previous wording

In connection with the Business Combination, we executed the TRA, which generally provides that the Special Limited Partner pay an amount equal to 85% of certain net tax benefits, if any, that the Company and its consolidated subsidiaries, including the Special Limited Partner, realize (or in certain cases is deemed to realize) as a result of the increases in tax basis and tax benefits related to the transactions contemplated under the Business Combination Agreement and the exchange of Retained RSILP Units for Class A Common Stock (or cash) and tax benefits related to entering into the TRA, including tax benefits attributable to payments under the TRA. Although the actual timing and amount of any payments made under the TRA will vary, such payments may be significant. Any payments made under the TRA will generally reduce the amount of overall cash flow that might have otherwise been available to us and, to the extent that payments required under the TRA are unable to be made for any reason, the unpaid amounts generally will be deferred and will accrue interest until paid. To date, no material payments under the TRA have been made, and no material payments thereunder are expected in the next twelve months as payments under the TRA are not owed until the tax benefits generated thereunder are more-likely-than-not to be realized. Significant payments under the TRA may be required upon tax benefits becoming more-likely-than-not to be realized.

Current wording

We are required to make payments equal to 85% of the tax benefits we realize in connection with the TRA. These obligations under the TRA, while mainly non-current in nature, reduce future operating cash flows as the associated tax benefits are realized. Although the actual timing and amount of any payments made under the TRA will vary, such payments may be significant. Any payments made under the TRA will generally reduce the amount of overall cash flow that might have otherwise been available to us and, to the extent that payments required under the TRA are unable to be made for any reason, the unpaid amounts generally will be deferred and will accrue interest until paid. To date, no material payments under the TRA have been made, and no material payments thereunder are expected in the next 12 months. We expect additional obligations of $112.7 million associated with the TRA liability subsequent to the upcoming 12-month period.

Previous wording

We expect our existing cash and cash equivalents and cash flows from operations to be sufficient to fund our operating activities and capital expenditure requirements for at least the next 12 months and thereafter for the foreseeable future. It is possible that we may need additional cash resources due to changed business conditions or other developments, including unanticipated regulatory developments, significant acquisitions, partnerships or marketing initiatives, deteriorating macroeconomic conditions and competitive pressures. We expect our capital expenditures and working capital requirements to continue to increase in the immediate future to support our growth as we seek to expand our offerings across more of North America, Latin America and worldwide, which will require significant investment in our online gaming platform and our personnel, in particular in product development, engineering and operations roles. We also expect certain costs such as marketing, market access and license fees to increase to the extent we pursue expansion opportunities in new and existing jurisdictions. In particular, we are party to several non-cancelable contracts with vendors and licensors for marketing and other strategic partnerships, pursuant to which we are obligated to make future minimum payments under the non-cancelable terms of these contracts. Additionally, our continued profitability will trigger future quarterly tax distribution obligations payable to the limited partners of RSILP under the RSILP Amended and Restated Limited Partnership Agreement, To the extent that our current resources are insufficient to satisfy our cash requirements, we may need to seek additional equity or debt financing. If the needed financing is not available, or if the terms of financing are less desirable than we expect, we may be forced to decrease our level of investment in new product, service or market launches and related marketing initiatives or to scale back our existing operations, which could have an adverse impact on our business and financial prospects.

Current wording

We expect our existing cash and cash equivalents and cash flows from operations to be sufficient to fund our operating activities and capital expenditure requirements for at least the next 12 months and thereafter for the foreseeable future. It is possible that we may need additional cash resources due to changed business conditions or other developments, including unanticipated regulatory developments, significant acquisitions, partnerships or marketing initiatives, deteriorating macroeconomic conditions and competitive pressures. We expect our capital expenditures and working capital requirements to continue to increase in the immediate future to support our growth as we seek to expand our offerings across more of North America, Latin America and worldwide, which will require significant investment in our online gaming platform and our personnel, in particular in product development, engineering and operations roles. We also expect certain costs such as marketing, market access and license fees to increase to the extent we pursue expansion opportunities in new and existing jurisdictions. In particular, we are party to several non-cancelable contracts with vendors and licensors for marketing, other strategic partnerships and leases, pursuant to which we are obligated to make future minimum payments under the non-cancelable terms of these contracts. Additionally, our continued profitability will trigger future quarterly tax distribution obligations payable to the limited partners of RSILP under the A&R Partnership Agreement. To the extent that our current resources are insufficient to satisfy our cash requirements, we may need to seek additional equity or debt financing. If the needed financing is not available, or if the terms of financing are less desirable than we expect, we may be forced to decrease our level of investment in new product, service or market launches and related marketing initiatives or to scale back our existing operations, which could have an adverse impact on our business and financial prospects.

Previous wording

As of March 31, 2025 and December 31, 2024, we had no outstanding debt. As of March 31, 2025 and December 31, 2024, we had an outstanding letter of credit for $4.6 million and $4.3 million, respectively, in connection with our operations in Colombia, for which no amounts had been drawn.

Current wording

As of June 30, 2025 and December 31, 2024, we had no outstanding debt. As of June 30, 2025 and December 31, 2024, we had an outstanding letter of credit for $5.8 million and $4.3 million, respectively, in connection with our operations in Colombia, for which no amounts had been drawn.

Previous wording

The following table shows our cash flows from operating activities, investing activities and financing activities for the three months ended March 31, 2025 and 2024:

Current wording

The following table shows our cash flows from operating activities, investing activities and financing activities for the six months ended June 30, 2025 and 2024:

Previous wording

Operating activities. Net cash provided by operating activities for the three months ended March 31, 2025 decreased by $2.2 million to $28.7 million, as compared to $30.9 million during the same period in 2024. The decrease was primarily brought by changes in operating assets and liabilities of $18.8 million, which was partially offset by higher period-over-period net income totaling $13.4 million and increased non-cash expenses of $3.6 million. The increase in non-cash expenses was driven primarily by additional depreciation and amortization, and share-based compensation expense totaling $2.4 million and $0.4 million, respectively which was partially offset by lower deferred income tax benefit of $0.8 million,

Current wording

Operating activities. Net cash provided by operating activities for the six months ended June 30, 2025 increased by $3.4 million to $54.5 million, as compared to $51.1 million during the same period in 2024. The increase was primarily brought by higher period-over-period net income totaling $42.5 million, which was partially offset by changes in operating assets and liabilities of $32.3 million and decreased non-cash expenses of $6.8 million. The decrease in non-cash expenses was driven primarily by deferred income tax benefit and decrease in share-based compensation expense totaling $121.3 million and $3.2 million, respectively, which was partially offset by tax receivable agreement expense totaling $113.0 million and additional depreciation and amortization totaling to $4.7 million.

Previous wording

Investing activities. Net cash used in investing activities for the three months ended March 31, 2025 increased by $0.1 million to $7.5 million, as compared to $7.4 million during the same period in 2024. The increase reflects higher acquisition of internally developed software costs totaling $0.5 million and acquisition of developed technology totaling $0.2 million. This was partially offset by lower period-over-period cash paid for acquisition of gaming licenses totaling $0.4 million, purchases of property and equipment totaling $0.1 million and short-term investment totaling $0.1 million.

Current wording

Investing activities. Net cash used in investing activities for the six months ended June 30, 2025 increased by $0.2 million to $19.1 million, as compared to $18.9 million during the same period in 2024. The increase reflects the acquisition of additional other intangible assets totaling $0.8 million, increased costs for internally developed software totaling $0.7 million and acquisition of developed technology totaling $0.2 million. This was partially offset by lower period-over- period short-term investments, acquisition of gaming licenses and purchases of property and equipment totaling $0.8 million, $0.4 million and $0.3 million, respectively.

Previous wording

Financing activities. Net cash used in financing activities for the three months ended March 31, 2025 increased by $27.0 million to $27.2 million, as compared to $0.2 million during the same period in 2024. The period-over-period increase primarily reflects the payments for employee taxes related to shares withheld and repurchases of Class A Common Stock totaling to $20.4 million and $5.1 million, respectively, and higher principal payments of finance lease liabilities of $1.5 million.

Current wording

Financing activities. Net cash used in financing activities for the six months ended June 30, 2025 increased by $33.4 million to $33.9 million, as compared to $0.5 million during the same period in 2024. The period-over-period increase primarily reflects the payments for employee taxes related to shares withheld and repurchases of Class A Common Stock totaling to $24.2 million and $7.6 million, respectively. Payments of finance lease liabilities contributed to the remainder of the period-over-period increase.

Previous wording

Effect of exchange rate changes on cash, cash equivalents and restricted cash. The effect of exchange rate changes increased cash, cash equivalents and restricted cash by $5.3 million for the three months ended March 31, 2025 as compared to an increase of less than $0.1 million for the same period in 2024. These changes were due to fluctuations in foreign currency exchange rates (primarily the Colombian Peso) from period to period.

Current wording

Effect of exchange rate changes on cash, cash equivalents and restricted cash. The effect of exchange rate changes increased cash, cash equivalents and restricted cash by $7.7 million for the six months ended June 30, 2025 as compared to a decrease of $3.9 million for the same period in 2024. These changes were due to fluctuations in foreign currency exchange rates (primarily the Colombian Peso) from period to period.

Previous wording

We have prepared our unaudited condensed consolidated financial statements in accordance with GAAP. In doing so, management is required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses during the reporting period. Management bases estimates on historical experience and other assumptions it believes to be reasonable under the circumstances and evaluates these estimates on an on-going basis. Actual results may differ from these estimates. Management has discussed the development, selection and disclosure of these estimates and assumptions with the Audit Committee of the Board.

Current wording

We have prepared our unaudited condensed consolidated financial statements in accordance with GAAP. In doing so, management is required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses during the reporting period. Management bases estimates on historical experience and other assumptions it believes to be reasonable under the circumstances and evaluates these estimates on an ongoing basis. Actual results may differ from these estimates. Management has discussed the development, selection and disclosure of these estimates and assumptions with the Audit Committee of the Board.