Rush Street Interactive, Inc.

Previous wording

We provide our customers with an array of leading gaming offerings such as real-money online casino, online sports betting and retail sports betting (i.e., sports betting services provided at bricks-and-mortar locations), as well as social gaming, which involves free-to-play games using virtual credits that users can earn or purchase. We launched our first social gaming website in 2015 and began accepting real-money bets in the United States in 2016. Currently, we offer real-money online casino, online sports betting and/or retail sports betting in 16 U.S. states and four international markets as outlined in the table found in “Business — Overview”.

Current wording

We provide our customers with an array of leading gaming offerings such as real-money online casino, online sports betting and retail sports betting (i.e., sports betting services provided at bricks-and-mortar locations), as well as social gaming, which involves free-to-play games using virtual credits that users can earn or purchase (where permitted). We launched our first social gaming website in 2015 and began accepting real-money bets in the United States in 2016. Currently, we offer real-money online casino, online sports betting and/or retail sports betting in 16 U.S. states and four international markets as outlined in the table found in “Business — Overview”.

Previous wording

We currently generate revenue through two operating models: (i) B2C and (ii) B2B. Through our primary operating model, B2C, we offer online casino, online sports betting, retail sports betting and social gaming directly to the end customer through our websites, apps or physical retail locations. Our B2C operations contributed more than 98% of our total revenue for the years ended December 31, 2024 and 2023, and we expect that it will continue to be our primary operating model into the future. While real-money transactions represent a majority of our B2C revenue, our social gaming offerings generally increase customer engagement and build online databases in key markets both before and after legalization and regulation. We believe our B2C model is flexible, permitting us to customize our operating structure based on applicable gaming regulations, market demands and, as applicable, our partner’s operations. Through our B2B operations, we primarily offer retail sports betting services to land-based businesses, such as bricks-and-mortar casinos, in exchange for a monthly commission. B2C and B2B products can be launched under one of our existing brands or customized to be incorporated into a local or third-party brand.

Current wording

We currently generate revenue through two operating models: (i) B2C and (ii) B2B. Through our primary operating model, B2C, we offer online casino, online sports betting, retail sports betting and social gaming directly to the end customer through our websites, apps or physical retail locations. Our B2C operations contributed more than 99% and 98% of our total revenue for the years ended December 31, 2025 and 2024, respectively and we expect that it will continue to be our primary operating model into the future. While real-money transactions represent a majority of our B2C revenue, our social gaming offerings generally increase customer engagement and build online databases in key markets both before and after legalization and regulation. We believe our B2C model is flexible, permitting us to customize our operating structure based on applicable gaming regulations, market demands and, as applicable, our partner’s operations. Through our B2B operations, we primarily offer retail sports betting services to land-based businesses, such as bricks-and-mortar casinos, in exchange for a monthly commission. B2C and B2B products can be launched under one of our existing brands or customized to be incorporated into a local or third-party brand.

Previous wording

MAUs is the number of unique users per month who have placed at least one real-money bet across one or more of our online casino or online sports betting offerings. For periods longer than one month, we average the MAUs for the months in the relevant period. We exclude users who have made a deposit but have not yet placed a real-money bet on at least one of our online offerings. We also exclude users who have placed a real-money bet but only with promotional incentives.

Current wording

MAUs is the number of unique users per month who have placed at least one real-money bet across one or more of our online casino (including online poker) or online sports betting offerings. For periods longer than one month, we average the MAUs for the months in the relevant period. We exclude users who have made a deposit but have not yet placed a real-money bet on at least one of our online offerings. We also exclude users who have placed a real-money bet but only with promotional incentives.

Previous wording

The year-over-year increase in MAUs in Latin America for 2024 compared to 2023, as well as for 2023 compared to 2022, was mainly due to our continued growth, strong customer retention rates, and our continued achievement of positive response from our strategic advertising and marketing efforts. We also experienced an uplift in MAUs in 2024 driven by the Copa América soccer tournament in mid-2024 and our launch in Peru during the third quarter of 2024. Additionally, the full year of operations in Mexico in 2023 significantly contributed to the year-over-year increase in MAUs for 2023 compared to 2022.

Current wording

The year-over-year increase in MAUs in Latin America for 2025 compared to 2024, as well as for 2024 compared to 2023, was mainly due to our continued growth, strong customer retention rates, and our continued achievement of positive response from our strategic advertising and marketing efforts. In 2024, we also experienced an uplift in MAUs driven by the Copa América soccer tournament in mid-2024 and our launch in Peru during the third quarter of 2024. Additionally, the full year of operations in Peru in 2025 contributed to the year-over-year increase in MAUs for 2025 compared to 2024.

Previous wording

The year-over-year increase in ARPMAU in the United States and Canada for 2024 compared to 2023, as well as for 2023 compared to 2022, was mainly due to MAU growth in online casino markets, including Delaware, outpacing that of sportsbetting only markets, the impact of our strategic advertising and marketing efforts and our focus on retaining quality players.

Current wording

ARPMAU remained generally flat in the United States and Canada for 2025 compared to 2024 while significantly increasing MAUs in the same period. This trend reflects the addition of new players, who typically generate lower ARPMAU compared to more established players. The year-over-year increase for 2024 compared to 2023 was mainly due to MAU growth in online casino markets, including Delaware, outpacing that of sports betting only markets, the impact of our strategic advertising and marketing efforts and our focus on retaining quality players.

Previous wording

We generally maintained ARPMAU in Latin America at a roughly consistent level for 2024 compared to 2023, while significantly increasing MAUs in the same period. The Company experienced a significant increase in sports betting-only customers, during the Copa América soccer tournament, who generally generate less revenue per customer than customers who use online casino.

Current wording

The year-over-year decrease in ARPMAU in Latin America for 2025 compared to 2024 was mainly driven by the negative impact of our additional player bonusing as a result of the value-added tax imposed on customer deposits in Colombia, which became effective during the year ended December 31, 2025. We generally maintained ARPMAU in Latin America at a roughly consistent level for 2024 compared to 2023, while significantly increasing MAUs in the same period. The Company experienced a significant increase in sports betting-only customers, during the 2024 Copa América soccer tournament, who generally generate less revenue per customer than customers who use online casino.

Previous wording

We define Adjusted EBITDA as net income (loss) before interest expense, income taxes, depreciation and amortization, share-based compensation, adjustments for certain one-time or non-recurring items and other adjustments. Adjusted EBITDA excludes certain expenses that are required in accordance with GAAP because certain expenses are either non-cash (i.e., depreciation and amortization, and share-based compensation) or are not related to our underlying business performance (i.e., interest income or expense and change in TRA liability).

Current wording

We define Adjusted EBITDA as net income (loss) before interest, income taxes, depreciation and amortization, share-based compensation, adjustments for certain one-time or non-recurring items and other adjustments that are detailed in the reconciliation table below. Adjusted EBITDA excludes certain expenses that are required in accordance with GAAP because certain expenses are either non-cash or are not related to our underlying business performance.

Previous wording

Our financial growth prospects largely depend on our ability to make our online casino and sports betting offerings available in more jurisdictions, with particular emphasis on the United States and Latin America, a trend that we believe is still in its early stage. Online casino may expand further due to many factors, including that many U.S. states and foreign jurisdictions are seeking ways to increase revenues. In the United States, online sports betting’s prospects were made possible after the U.S. Supreme Court struck down PASPA in May 2018. Our strategy is to enter new jurisdictions that we believe are financially prudent for us to enter. Online casino is currently authorized only in eight U.S. states: Connecticut, Delaware, Michigan, New Jersey, Pennsylvania, West Virginia, Rhode Island and Nevada (although regulators have not authorized online casino outside of physical casinos in Nevada). As of the date hereof, 39 states and the District of Columbia have authorized sports betting. Of those 40 jurisdictions, 32 states have authorized statewide online sports betting while 8 remain authorized for retail-only at casinos or retail locations. In Latin America, several countries, including Argentina, Ecuador, Brazil and Peru, are either exploring legalizing, expanding or regulating online casino and/or online sports betting, or have recently legalized these activities.

Current wording

Our financial growth prospects largely depend on our ability to make our online casino and sports betting offerings available in more jurisdictions, with particular emphasis on the United States and Latin America, a trend that we believe is still in its early stage. Online casino may expand further due to many factors, including that many U.S. states and foreign jurisdictions are seeking ways to increase revenues. In the United States, online sports betting’s prospects were made possible after the U.S. Supreme Court struck down PASPA in May 2018. Our strategy is to enter new jurisdictions that we believe are financially prudent for us to enter. Online casino is currently authorized only in nine U.S. states: Connecticut, Delaware, Maine (although the market is not yet operating), Michigan, New Jersey, Pennsylvania, West Virginia, Rhode Island and Nevada (although regulators have not authorized online casino outside of physical casinos in Nevada). As of the date hereof, 39 states and the District of Columbia have authorized sports betting. Of those 40 jurisdictions, 32 states have authorized statewide online sports betting while 8 remain authorized for retail-only at casinos or retail locations. In Latin America, several countries, including Argentina, Ecuador, Brazil and Peru, are either exploring legalizing, expanding or regulating online casino and/or online sports betting, or have recently legalized these activities.

Previous wording

The process of securing the necessary licenses or partnerships to operate in a given jurisdiction may take longer than we anticipate. In addition, legislative or regulatory restrictions and gaming taxes may make it less attractive or more difficult for us to do business in a particular jurisdiction. Further, certain jurisdictions require us to have a relationship with a bricks-and-mortar casino or other land-based partner for online casino and/or sports betting access, which tends to increase our costs of revenue. Jurisdictions that have established state or government-run monopolies may limit opportunities for private operators such as us.

Current wording

The process of securing the necessary licenses or partnerships to operate in a given jurisdiction may take longer or be more difficult than we anticipate. In addition, legislative or regulatory restrictions and gaming taxes may make it less attractive or more difficult for us to do business in a particular jurisdiction. Further, certain jurisdictions require us to have a relationship with a bricks-and-mortar casino or other land-based partner for online casino and/or sports betting access, which tends to increase our costs of revenue. Jurisdictions that have established state or government-run monopolies may limit opportunities for private operators such as us.

Previous wording

States, foreign jurisdictions and some local governments impose tax rates on online casino and sports betting, which may vary substantially between jurisdictions and may change from time to time, usually because of factors outside our control. We are also subject to a U.S. federal excise tax of 0.25% on the amount of each sports bet placed in the United States. We believe the jurisdictions that will create the most compelling levels of profitability for us are jurisdictions with both online casino and sports betting at favorable tax rates.

Current wording

States, foreign jurisdictions and some local governments impose tax rates on online casino and sports betting, which may vary substantially between jurisdictions and may change from time to time, usually because of factors outside our control. We are also subject to a U.S. federal excise tax of 0.25% on the amount of each sports bet placed in the United

Previous wording

With respect to paid marketing, we use a broad array of advertising channels, including television, radio, social media platforms, sponsorships, affiliates and paid search, and other digital channels. We also use other forms of marketing and outreach, such as our social media channels, first-party websites, media interviews and other media spots and organic searches. These efforts are concentrated within the specific jurisdictions where we operate or intend to operate. We believe there is significant benefit to having a flexible approach to advertising spending as we can quickly redirect our advertising spending based on dynamic testing of which advertising methods and channels are working and which ones are not.

Current wording

With respect to paid marketing, we use a broad array of advertising channels, including television, radio, out-of-home (i.e., billboards, stadium signage), social media platforms, sponsorships, affiliates and paid search, and other digital channels. We also use other forms of marketing and outreach, such as our social media channels, first-party websites, media interviews and other media spots and organic searches. These efforts are concentrated within the specific jurisdictions where we operate or intend to operate to the extent possible. We believe there is significant benefit to having a flexible approach to advertising spending as we can quickly redirect our advertising spending based on dynamic testing of which advertising methods and channels are working and which ones are not. These investments and personalized promotions are intended to increase consumer awareness and drive engagement.

Previous wording

We currently offer real-money online casino, online sports betting and/or retail sports betting in 16 U.S. states, Colombia, Ontario, Canada, Mexico and Peru. We also provide social gaming (where permitted), where users can earn or purchase virtual credits to enjoy free-to-play games.

Current wording

We currently offer real-money online casino, online sports betting and/or retail sports betting in 16 U.S. states, Colombia, Ontario, Canada, Mexico and Peru. We also provide social gaming, where users can earn or purchase (where permitted) virtual credits to enjoy free-to-play games.

Previous wording

We provide social gaming (where permitted) where users can earn or purchase virtual credits to enjoy free-to-play games. Users who exhaust their credits can either purchase additional virtual credits from the virtual cashier or wait until their virtual credits are replenished for free. Virtual credits have no monetary value and can only be used within our social gaming platform.

Current wording

We provide social gaming where users can earn or purchase (where permitted) virtual credits to enjoy free-to-play games. Users who exhaust their credits can either purchase additional virtual credits from the virtual cashier, if permitted, or wait until their virtual credits are replenished for free. Virtual credits have no monetary value and can only be used within our social gaming platform.

Previous wording

Costs of Revenue. Costs of revenue consist primarily of (i) revenue share and market access fees, (ii) third-party platform and content fees, (iii) gaming taxes, (iv) payment processing fees and chargebacks and (v) salaries, bonuses, benefits and share-based compensation for dedicated personnel. These costs are primarily variable in nature and should typically correlate with the change in revenue. Revenue share and market access fees consist primarily of variable amounts paid to local partners that hold the applicable gaming license, providing us the ability to offer our real-money online offerings in the respective jurisdictions. Our third-party platform and content fees are primarily driven by costs associated with third-party casino content, sports betting trading services and certain elements of our platform technology, such as geolocation and know-your-customer. Gaming taxes primarily relate to state taxes and are determined on a jurisdiction-by-jurisdiction basis. We incur payment processing costs on customer deposits and occasionally chargebacks (i.e., when a payment processor contractually disallows customer deposits in the normal course of business).

Current wording

Costs of Revenue. Costs of revenue consist primarily of (i) revenue share and market access fees, which is reduced by any consideration from the vendor, (ii) third-party platform and content fees, (iii) gaming taxes, (iv) payment processing fees and chargebacks and (v) salaries, bonuses, benefits and share-based compensation for dedicated personnel. These costs are primarily variable in nature and should, in large part, correlate with the change in revenue. Revenue share and market access fees consist primarily of variable amounts paid to local partners that hold the applicable gaming license, providing us the ability to offer our real-money online offerings in the respective jurisdictions. Our third-party platform and content fees are primarily driven by costs associated with third-party casino content, data and streaming, sports betting trading services, geolocation, know-your-customer and platform hosting. Gaming taxes include jurisdictional taxes that are determined based on a percentage of revenue (or similar metrics) or excise taxes that are determined based on a percentage of bets placed. We incur payment processing costs on player deposits, withdrawals and occasionally chargebacks (i.e., when a payment processor contractually disallows customer deposits in the normal course of business).

Previous wording

Advertising and Promotions Costs. Advertising and promotion costs consist primarily of costs associated with marketing our offerings via different channels, promotional activities and related customer acquisition costs. These costs also include salaries, bonuses, benefits and share-based compensation for dedicated personnel and are expensed as incurred.

Current wording

Sales and Marketing. Sales and marketing costs consist primarily of costs associated with marketing our products and services via different channels, promotional activities and the related costs incurred to acquire new customers. These costs also include salaries, bonuses, benefits and share-based compensation for dedicated personnel and are expensed as incurred.

Previous wording

With respect to paid marketing, we use a broad array of advertising channels, including television, radio, social media platforms, sponsorships, affiliates and paid search, and other digital channels. We also use other forms of marketing and outreach, such as our social media channels, first-party websites, media interviews and other media spots and organic searches. These efforts are primarily concentrated within the specific jurisdictions where we operate or intend to operate. We believe there is significant benefit to having a flexible approach to advertising spending as we can quickly redirect our advertising spending based on dynamic testing of our advertising methods and channels.

Current wording

With respect to paid marketing, we use a broad array of advertising channels, including television, radio, out-of-home (i.e., billboards, stadium signage), social media platforms, sponsorships, affiliates and paid search, and other digital channels. We also use other forms of marketing and outreach, such as our social media channels, first-party websites, media interviews and other media spots and organic searches. These efforts are primarily concentrated within the specific jurisdictions where we operate or intend to operate. We believe there is significant benefit to having a flexible approach to advertising spending as we can quickly redirect our advertising spending based on dynamic testing of our advertising methods and channels.

Previous wording

General and Administrative. General and administrative expenses consist primarily of administrative personnel costs, including salaries, bonuses and benefits, share-based compensation expense for dedicated personnel, professional fees related to legal, compliance, audit and consulting services, rent, insurance costs, technology and foreign exchange gains or losses.

Current wording

General and Administrative. General and administrative costs consist primarily of administrative personnel costs (including salaries, bonuses, benefits and share-based compensation), professional fees related to legal, compliance, accounting and consulting, indirect technology costs, rent expense, insurance costs and foreign exchange gains or losses.

Previous wording

Revenue. Revenue increased by $232.9 million, or 34%, to $924.1 million in 2024 as compared to $691.2 million in 2023. The increase was mainly due to and directly correlated with our continued growth across existing markets and expansion into new markets that launched during 2023 and 2024. The increase reflects higher period-over-period online casino and sports betting revenue of $243.0 million and social gaming revenue of $0.4 million, which was partially offset by a decrease of retail sports betting revenue of $10.5 million due to our exit from the Connecticut market in 2023.

Current wording

Revenue. Revenue increased by $210.3 million, or 23%, to $1,134.4 million in 2025 as compared to $924.1 million in 2024. The increase was mainly due to and directly correlated with our continued growth across existing markets and expansion into new markets such as Peru, which launched in late July 2024. The increase reflects higher period-over-period online casino and sports betting revenue of $210.4 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

Costs of Revenue. Costs of revenue increased by $137.0 million, or 29%, to $602.0 million in 2024 as compared to $465.0 million in 2023. The increase was mainly due to and directly correlated with, our expansion and continued growth as noted above. Market access costs, gaming taxes, operating expenses, and payment processing costs contributed $58.5 million, $44.8 million, $20.9 million and $10.5 million, respectively, to the year-over-year increase in costs of revenue, with personnel costs contributing to the remaining $2.3 million of the year-over-year increase. Costs of revenue as a percentage of revenue decreased to 65% in 2024 as compared to 67% in 2023.

Current wording

Costs of Revenue. Costs of revenue increased by $139.6 million, or 23%, to $741.6 million in 2025 as compared to $602.0 million 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 $56.4 million, $46.3 million, $23.5 million and $13.2 million, respectively, to the year-over-year increase in costs of revenue, with personnel costs contributing to the remaining $0.2 million of the year-over-year increase. Costs of revenue as a percentage of revenue remained flat at 65% for the years ended December 31, 2025 and 2024.

Previous wording

Advertising and Promotions. Advertising and promotions expense decreased by $2.1 million, or 1%, to $158.6 million in 2024 as compared to $160.7 million in 2023. The decrease was mainly due to management’s strategy of rationalizing marketing spend as the North American and Latin American online gaming industries continue to mature. Advertising and promotions expense as a percentage of revenue decreased to 17% in 2024 as compared to 23% in 2023.

Current wording

Sales and Marketing. Sales and marketing expense increased by $6.1 million, or 4%, to $164.7 million in 2025 as compared to $158.6 million 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 15% in 2025 as compared to 17% in 2024.

Previous wording

General and Administrative. General and administrative expense increased by $19.6 million, or 22%, to $106.9 million in 2024 as compared to $87.3 million in 2023. The year-over-year increase was due to higher personnel and other administrative costs, which is consistent with the ongoing growth of our business. General and administrative expense as a percentage of revenue decreased to 12% in 2024 as compared to 13% in 2023.

Current wording

General and Administrative. General and administrative expense decreased by $5.5 million, or 5%, to $100.7 million in 2025 as compared to $106.2 million in 2024. The year-over-year decrease was primarily due to lower share-based compensation expense, which was partially offset by higher personnel and other administrative costs, consistent with the growth of our business. General and administrative expense as a percentage of revenue decreased to 9% in 2025 as compared to 11% in 2024.

Previous wording

Depreciation and Amortization. Depreciation and amortization expense increased by $2.4 million, or 8%, to $32.2 million in 2024 as compared to $29.8 million in 2023. 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 decreased to 3% in 2024 as compared to 4% in 2023.

Current wording

Depreciation and Amortization. Depreciation and amortization expense increased by $7.8 million, or 24%, to $40.0 million in 2025 as compared to $32.2 million 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% in 2025 as compared to 3% in 2024.

Previous wording

Interest Income, Net. Interest income, net, increased by $4.7 million, or 171%, to $7.5 million in 2024 as compared to $2.8 million in 2023. 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 2023.

Current wording

Interest Income, Net. Interest income, net, increased by $1.8 million, or 24%, to $9.3 million in 2025 as compared to $7.5 million 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

Our results of operations may, and generally do, fluctuate due to seasonal trends and other factors such as level of customer engagement, online casino and sports betting results and other factors that are outside of our control or that we cannot reasonably predict. Our financial performance depends on our ability to attract and retain customers. Customer engagement in our online offerings may vary due to, among other things, customer satisfaction with our platform, the number, timing and type of sporting events, the length of professional sports seasons, our offerings and marketing efforts and those of our competitors (including those not just in the online gaming industry but also in the entertainment industry broadly), other forms of entertainment available to our customers, weather conditions, public sentiment, an economic downturn or other economic factors such as inflation, economic uncertainty or macroeconomic conditions. As customer engagement varies, so may our financial performance.

Current wording

Our results of operations may, and generally do, fluctuate due to seasonal trends and other factors such as level of customer engagement, online casino and sports betting results and other factors that are outside of our control or that we cannot reasonably predict. Our financial performance depends on our ability to attract and retain customers. Customer engagement in our online offerings may vary due to, among other things, customer satisfaction with our platform, the number, timing and type of sporting events, the length of professional sports seasons, our offerings and marketing efforts and those of our competitors (including those not just in the online gaming industry but also in prediction markets or in the entertainment industry broadly), other forms of entertainment available to our customers, weather conditions, public sentiment, an economic downturn or other economic factors such as inflation, economic uncertainty or macroeconomic conditions. As customer engagement varies, so may our financial performance.

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 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., World Cup, Copa América, UEFA, Olympics).

Previous wording

From a legislative perspective, we continue to see strong momentum to legalize and regulate online sports betting in new jurisdictions in the Americas. As expected, many of these new jurisdictions are first trying to legalize and regulate online sports betting before considering whether to legalize and regulate online casino. However, given the tax generation success of online casino in markets where it has been legalized, we also continue to see strong momentum for online casino in several jurisdictions in the Americas that are looking for additional revenue sources to fund expanding budgets. For example, in 2025 through the date of this filing, several U.S. states introduced bills to legalize and regulate online casino. While the outcome of these bills is uncertain, and some of them have already been tabled or did not receive the necessary votes to proceed at this time, it shows that there is strong interest in legalizing online casino. Additionally, we have seen governmental officials or legislative or regulatory bodies in certain jurisdictions in which we operate consider, and in limited cases to date, approve, increases in gaming-related taxes or other types of taxes on companies operating in the gaming industry. While it is unclear at this time if this will continue, any proposed legislation or other similar actions to increase existing taxes on online sportsbook and/or casino could negatively impact our business, profitability and cash flows.

Current wording

From a legislative perspective, we continue to see strong momentum to legalize and regulate online sports betting in new jurisdictions in the Americas. As expected, many of these new jurisdictions are first trying to legalize and regulate online sports betting before considering whether to legalize and regulate online casino. However, given the tax generation success of online casino in markets where it has been legalized, we also continue to see strong momentum for online casino in several jurisdictions in the Americas that are looking for additional revenue sources to fund expanding budgets. For example, in 2025 and thus far in 2026, several U.S. states introduced bills to legalize and regulate online casino. Earlier this year, one such bill in Maine became law enabling statewide wagering in partnership with certain Native American tribes, while others either remain pending, including a bill in Virginia that has received several favorable votes during this current legislative session. We believe this shows that there is strong interest in legalizing online casino. Additionally, we have seen governmental officials or legislative or regulatory bodies in certain jurisdictions in which we operate consider, and in limited cases to date, approve, increases in gaming-related taxes or other types of taxes on companies operating in the gaming industry. While it is unclear at this time if this will continue, any proposed legislation or other similar actions to increase existing taxes on online sportsbook and/or casino could negatively impact our business, profitability and cash flows.

Previous wording

We had $229.2 million in cash and cash equivalents as of December 31, 2024 (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 December 31, 2025, we had $336.3 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 $5.8 million of non-cancellable purchase obligations with marketing vendors, $3.6 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 $39.1 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. 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 $18.3 million of non-cancellable purchase obligations with marketing vendors, $4.1 million of minimum license and market access fees, and $2.8 million of lease payments. We also have $55.6 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 near future as payments under the TRA are not owed until the tax benefits generated thereunder are 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. Payments associated with the TRA liability are expected to include $1.2 million in the next 12 months and additional obligations of $128.8 million are expected subsequent to the upcoming 12-month period.

Previous wording

We expect our existing cash and cash equivalent 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. See Note 14 of our consolidated financial statements, included elsewhere in this Annual Report for a summary of our commitments as of December 31, 2024. 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. 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. See Note 1 to our consolidated financial statements, included elsewhere in this Annual Report.

Current wording

We expect our existing cash and cash equivalent 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. See Note 14 of our consolidated financial statements, included elsewhere in this Annual Report for a summary of our commitments as of December 31, 2025. 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 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. See Note 1 to our consolidated financial statements, included elsewhere in this Annual Report.

Previous wording

We had been issued $31.1 million and $28.0 million in surety bonds as of December 31, 2024 and 2023, respectively, that are used to satisfy regulatory requirements related to securing cash held for the behalf of customers.

Current wording

We had been issued $31.3 million and $31.1 million in surety bonds as of December 31, 2025 and 2024, respectively, that are used to satisfy regulatory requirements related to securing cash held on behalf of customers. In addition, we had also been issued $6.4 million and $6.1 million in surety bonds as of December 31, 2025 and 2024, respectively, to satisfy regulatory requirements necessary to operate in certain jurisdictions.

Previous wording

There have been no claims against any of our surety bonds and the likelihood of future claims is remote.

Current wording

There have been no claims against any of our surety bonds and the likelihood of future claims is expected to be remote.

Previous wording

As of December 31, 2024 and 2023, we had no outstanding debt. As of December 31, 2024 and 2023, we had an outstanding letter of credit for $4.3 million and $3.1 million, respectively, in connection with our operations in Colombia for which no amounts had been drawn.

Current wording

As of December 31, 2025 and 2024, we had an outstanding letter of credit for $6.2 million and $4.3 million, respectively, in connection with our operations in Colombia for which no amounts had been drawn.

Previous wording

On October 24, 2024, our Board authorized the repurchase of an aggregate of up to $50 million of our Class A Common Stock through open market purchases, privately negotiated transactions or other transactions in accordance with applicable securities laws.

Current wording

On October 24, 2024, our Board authorized the repurchase of an aggregate of up to $50 million of our Class A Common Stock through open market purchases, privately negotiated transactions or other transactions in accordance with applicable securities laws (the “Stock Repurchase Program”).

Previous wording

Operating activities. Net cash provided by operating activities was $106.4 million for the year ended December 31, 2024 as compared to $5.9 million used in operating activities for the year ended December 31, 2023. The increased provision of cash reflects a higher period-over-period net income totaling $67.3 million, increased non-cash expenses of $7.3 million, and an increase of $37.8 million due to the change in operating assets and liabilities. The increase in non-cash expenses was driven primarily by additional share-based compensation expense totaling $5.3 million, depreciation and amortization expense of $2.4 million, non-cash lease expense of $0.2 million and deferred income taxes of $0.1 million, which was partially offset by fewer write-offs of long-lived assets of $0.7 million.

Current wording

Operating activities. Net cash provided by operating activities during 2025 increased by $58.6 million to $165.0 million, as compared to $106.4 million during the same period in 2024. The increase was primarily due to higher period-over-period net income totaling $66.8 million, which was partially offset by a decrease in non-cash expenses of $6.2 million and changes in operating assets and liabilities of $2.0 million. The decrease in non-cash expenses was driven primarily by the deferred income tax benefit of $112.1 million and a decrease in share-based compensation expense totaling $9.0 million, which was partially offset by change in tax receivable agreement liability, additional depreciation and amortization expense and non-cash lease expense of $107.0 million, $7.8 million and $0.1 million, respectively.

Previous wording

Investing activities. Net cash used in investing activities during 2024 decreased by $0.4 million to $33.4 million, as compared to $33.8 million during 2023. The decrease reflects lower period-over-period cash paid for gaming licenses of $3.2 million, short-term investments of $1.2 million, investment in equity securities of $0.5 million, and property and equipment purchases of $0.4 million. This was partially offset by higher cash paid for internally developed software totaling $1.9 million, other intangible assets of $1.3 million and the proceeds from the maturity of long-term deposits of $1.7 million in 2023.

Current wording

Investing activities. Net cash used in investing activities during 2025 increased by $3.6 million to $37.0 million, as compared to $33.4 million during 2024. The increase reflects higher cash paid for internally developed software totaling $4.2 million and additional acquisitions of other intangible assets and developed technology totaling $0.5 million and $0.2 million, respectively. This was partially offset by lower period-over-period short-term investments, acquisition of gaming licenses and purchases of property and equipment of $0.8 million, $0.3 million and $0.2 million, respectively.

Previous wording

Financing activities. Net cash used in financing activities during 2024 increased by $2.1 million to $2.6 million, as compared to $0.5 million during 2023. The increase reflects both higher payments of employee taxes related to shares withheld and finance liabilities totaling $1.2 million and $1.0 million, respectively, which was slightly offset by proceeds from exercise of stock options of $0.1 million in 2024.

Current wording

Financing activities. Net cash used in financing activities during 2025 increased by $34.7 million to $37.4 million, as compared to $2.7 million during 2024. The increase reflects higher payments of employee taxes related to net share settlement of equity awards, repurchases of Class A Common Stock, payments of finance liabilities and payments for tax distributions to non-controlling interests totaling $25.3 million, $7.6 million, $1.2 million, $0.7 million, respectively, which was slightly offset by lower proceeds from exercise of stock options of $0.1 million.

Previous wording

Effect of exchange rate changes on cash, cash equivalents and restricted cash. The net effect of exchange rate changes on cash, cash equivalents and restricted cash, when expressed in U.S. Dollar terms, was a decrease of $8.7 million for the year ended December 31, 2024 as compared to an increase of $5.1 million in 2023. 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 net effect of exchange rate changes on cash, cash equivalents and restricted cash, when expressed in U.S. Dollar terms, was an increase of $17.1 million for the year ended December 31, 2025 as compared to a decrease of $8.7 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 regularly review our deferred tax assets, including net operating loss carryovers, for recoverability, and a valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset may not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which the temporary differences are deductible. In assessing the need for a valuation allowance, we make estimates and assumptions regarding projected future taxable income, our ability to carry back operating losses to prior periods, the reversal of deferred tax liabilities and the implementation of tax planning strategies. Based on our cumulative earnings history and forecasted future sources of taxable income, we have determined we are not more-likely-than-not to realize existing deferred tax assets and thus have recorded a valuation allowance. As we reassess these assumptions in the future, changes in forecasted taxable income may alter this expectation and may result in an increase to the valuation allowance and an increase in the effective tax rate.

Current wording

We regularly review our deferred tax assets, including net operating loss carryovers, for recoverability, and a valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset may not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which the temporary differences are deductible. In assessing the need for a valuation allowance, we make estimates and assumptions regarding projected future taxable income, our ability to carry back operating losses to prior periods, the reversal of deferred tax liabilities and the implementation of tax planning strategies. Based on historical pre-tax earnings trends and assumptions about future performance, we expect to generate taxable income in future periods. Accordingly, we have determined that it is more-likely-than-not that certain deferred tax assets are realizable. As we reassess these assumptions in the future, changes in forecasted taxable income may alter this expectation and may result in an increase to the valuation allowance and an increase in the effective tax rate.

Previous wording

We evaluate the realizability of the deferred tax assets resulting from the exchange of RSILP Units for Class A Common Stock. If the deferred tax assets are determined to be realizable, we then assess whether payment of amounts under the TRA have become probable. If so, we record a TRA liability equal to 85% of such deferred tax assets. In subsequent periods, we assess the realizability of all our deferred tax assets subject to the TRA. Should it be determined that a deferred tax asset with a valuation allowance is realizable in a subsequent period, the related valuation allowance will be released and consideration of a corresponding TRA liability will be assessed. The realizability of deferred tax assets, including those subject to the TRA, is dependent upon the generation of future taxable income during the periods in which those deferred tax assets become deductible and consideration of prudent and feasible tax-planning strategies.

Current wording

We evaluate the realizability of the deferred tax assets resulting from the exchange of RSILP Units for Class A Common Stock. If the deferred tax assets are determined to be realizable, we then assess whether payment of amounts under the TRA have become probable. If so, we record a TRA liability, generally equal to 85% of such deferred tax assets. In subsequent periods, we assess the realizability of all our deferred tax assets subject to the TRA. Should it be determined that a deferred tax asset with a valuation allowance is realizable in a subsequent period, the related valuation allowance will be released and consideration of a corresponding TRA liability will be assessed. The realizability of deferred tax assets, including those subject to the TRA, is dependent upon the generation of future taxable income during the periods in which those deferred tax assets become deductible and consideration of prudent and feasible tax-planning strategies.