Cover Page
Cover Page - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Mar. 06, 2024 | Jun. 30, 2023 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-39232 | ||
Entity Registrant Name | RUSH STREET INTERACTIVE, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 84-3626708 | ||
Entity Address, Address Line One | 900 N. Michigan Avenue | ||
Entity Address, Address Line Two | Suite 950 | ||
Entity Address, City or Town | Chicago | ||
Entity Address, State or Province | IL | ||
Entity Address, Postal Zip Code | 60611 | ||
City Area Code | 773 | ||
Local Phone Number | 893-5855 | ||
Title of 12(b) Security | Class A common stock, $0.0001 par value per share | ||
Trading Symbol | RSI | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
ICFR Auditor Attestation Flag | false | ||
Document Financial Statement Error Correction | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 202,346,598 | ||
Document Information [Line Items] | |||
Documents Incorporated by Reference | Portions of our Definitive Proxy Statement for our 2024 Annual Meeting of Stockholders, to be filed within 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K, are incorporated by reference into Part III of this Form 10-K. Except with respect to information specifically incorporated by reference in this Annual Report, the Proxy Statement shall not be deemed to be filed as part hereof. | ||
Entity Central Index Key | 0001793659 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2023 | ||
Amendment Flag | false | ||
Class A Common Stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding (in shares) | 76,537,867 | ||
Class V Common Stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding (in shares) | 146,434,310 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Auditor Information [Abstract] | |
Auditor Name | WithumSmith+Brown, PC |
Auditor Location | New York, New York |
Auditor Firm ID | 100 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash and cash equivalents | $ 168,330 | $ 179,723 |
Restricted cash | 2,647 | 26,358 |
Players' receivables | 10,516 | 11,174 |
Prepaid expenses and other current assets | 13,651 | 11,312 |
Total current assets | 228,615 | 264,471 |
Intangible assets, net | 74,874 | 69,025 |
Property and equipment, net | 8,611 | 9,764 |
Operating lease assets | 1,276 | 1,852 |
Other assets | 5,204 | 5,234 |
Total assets | 318,580 | 350,346 |
Current liabilities | ||
Accounts payable | 32,347 | 29,803 |
Accrued expenses | 51,312 | 64,903 |
Players' liabilities | 42,135 | 42,512 |
Current deferred royalty liabilities | 1,712 | 1,526 |
Current operating lease liabilities | 621 | 722 |
Other current liabilities | 9,566 | 4,479 |
Total current liabilities | 137,693 | 143,945 |
Non-current deferred royalty liabilities | 12,395 | 14,106 |
Non-current operating lease liabilities | 673 | 1,177 |
Other non-current liabilities | 1,690 | 244 |
Total liabilities | 152,451 | 159,472 |
Commitments and contingencies | ||
Stockholders’ equity | ||
Additional paid-in capital | 192,163 | 177,683 |
Accumulated other comprehensive loss | (100) | (1,648) |
Accumulated deficit | (138,317) | (120,012) |
Total stockholders’ equity attributable to Rush Street Interactive, Inc. | 53,768 | 56,045 |
Non-controlling interests | 112,361 | 134,829 |
Total stockholders’ equity | 166,129 | 190,874 |
Total liabilities and stockholders’ equity | 318,580 | 350,346 |
Related Party | ||
Current assets | ||
Due from affiliates | 33,471 | 35,904 |
Class A Common Stock | ||
Stockholders’ equity | ||
Common stock, value | 7 | 6 |
Class V Common Stock | ||
Stockholders’ equity | ||
Common stock, value | $ 15 | $ 16 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2023 | Dec. 31, 2022 |
Class A Common Stock | ||
Common stock, par value (in USD per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 750,000,000 | 750,000,000 |
Common stock, shares issued (in shares) | 72,387,409 | 65,111,616 |
Common stock, shares outstanding (in shares) | 72,387,409 | 65,111,616 |
Class V Common Stock | ||
Common stock, par value (in USD per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 150,434,310 | 155,955,584 |
Common stock, shares outstanding (in shares) | 150,434,310 | 155,955,584 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | |||
Revenue | $ 691,161 | $ 592,212 | $ 488,105 |
Operating costs and expenses | |||
Costs of revenue | 465,014 | 414,664 | 332,145 |
Advertising and promotions | 160,650 | 220,460 | 190,476 |
General and administrative | 87,349 | 67,561 | 55,518 |
Depreciation and amortization | 29,759 | 14,325 | 4,245 |
Total operating costs and expenses | 742,772 | 717,010 | 582,384 |
Loss from operations | (51,611) | (124,798) | (94,279) |
Other income (expenses) | |||
Interest income (expense), net | 2,765 | (573) | (187) |
Change in fair value of warrant liabilities | 0 | 0 | 41,802 |
Change in fair value of earnout interests liability | 0 | 0 | (13,740) |
Total other income (expense) | 2,765 | (573) | 27,875 |
Loss before income taxes | (48,846) | (125,371) | (66,404) |
Income tax expense | 11,209 | 8,961 | 4,688 |
Net loss | (60,055) | (134,332) | (71,092) |
Net loss attributable to non-controlling interests | (41,750) | (95,701) | (51,603) |
Net loss attributable to Rush Street Interactive, Inc. | $ (18,305) | $ (38,631) | $ (19,489) |
Net income (loss) per common share attributable to Rush Street Interactive, Inc. - basic (in USD per share) | $ (0.27) | $ (0.61) | $ (0.35) |
Weighted average common shares outstanding - basic (in shares) | 68,508,093 | 63,532,906 | 56,265,541 |
Net loss per common share attributable to Rush Street Interactive, Inc. - diluted (in USD per share) | $ (0.27) | $ (0.61) | $ (0.51) |
Weighted average common shares outstanding - diluted (in shares) | 68,508,093 | 63,532,906 | 57,426,885 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (60,055) | $ (134,332) | $ (71,092) |
Other comprehensive income (loss) | |||
Foreign currency translation adjustment | 5,290 | (3,886) | (2,111) |
Comprehensive loss | (54,765) | (138,218) | (73,203) |
Comprehensive loss attributable to non-controlling interests | (38,111) | (98,441) | (53,168) |
Comprehensive loss attributable to Rush Street Interactive, Inc. | $ (16,654) | $ (39,777) | $ (20,035) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (DEFICIT) - USD ($) $ in Thousands | Total | Class A Common Stock | Stockholders’ Equity (Deficit) | Common Stock Class A Common Stock | Common Stock Class V Common Stock | Treasury Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Non- Controlling Interests |
Balance at beginning of year (in shares) at Dec. 31, 2020 | 44,792,517 | 160,000,000 | ||||||||
Balance at beginning of year at Dec. 31, 2020 | $ (267,329) | $ (61,779) | $ 4 | $ 16 | $ 0 | $ 0 | $ 93 | $ (61,892) | $ (205,550) | |
Treasury stock, beginning balance (in shares) at Dec. 31, 2020 | 0 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Share-based compensation (in shares) | 855,894 | |||||||||
Share-based compensation | 24,912 | 6,196 | 6,196 | 18,716 | ||||||
Foreign currency translation adjustment | (2,111) | (546) | (546) | (1,565) | ||||||
Issuance of class A common stock upon exercise of warrants (in shares) | 14,014,197 | |||||||||
Issuance of Class A Common Stock upon exercise of Warrants | 259,895 | 70,146 | $ 2 | 70,144 | 189,749 | |||||
Net loss | (71,092) | (19,489) | (19,489) | (51,603) | ||||||
Allocation of equity and non-controlling interests upon changes in RSILP ownership | 0 | 11,288 | 11,310 | (22) | (11,288) | |||||
Acquisition of intangibles (in shares) | 158,127 | |||||||||
Acquisition of intangibles | 2,500 | 691 | 691 | 1,809 | ||||||
Repurchase of class A common stock (in shares) | 218,589 | |||||||||
Repurchase of Class A Common Stock | (3,465) | (850) | $ (850) | (2,615) | ||||||
Reissuance of treasury stock (in shares) | (218,589) | |||||||||
Reissuance of treasury stock | 0 | $ 850 | (850) | |||||||
Settlement of earnout interests liability | 364,788 | 79,779 | 79,779 | 285,009 | ||||||
Distributions paid to non-controlling interest holders | (397) | (397) | ||||||||
Issuance of class A common stock upon RSILP unit exchanges (in shares) | 1,297,671 | (1,297,671) | ||||||||
Balance at end of the year (in shares) at Dec. 31, 2021 | 61,118,406 | 158,702,329 | ||||||||
Balance at end of the year at Dec. 31, 2021 | 307,701 | 85,436 | $ 6 | $ 16 | $ 0 | 167,270 | (475) | (81,381) | 222,265 | |
Treasury stock, ending balance (in shares) at Dec. 31, 2021 | 0 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Share-based compensation (in shares) | 706,465 | |||||||||
Share-based compensation | 18,691 | 5,459 | 5,459 | 13,232 | ||||||
Foreign currency translation adjustment | (3,886) | (1,146) | (1,146) | (2,740) | ||||||
Issuance of class A common stock upon exercise of warrants (in shares) | 11,442,389 | 3,226,745 | (3,226,745) | |||||||
Net loss | (134,332) | (38,631) | (38,631) | (95,701) | ||||||
Allocation of equity and non-controlling interests upon changes in RSILP ownership | 0 | 4,141 | 4,168 | (27) | (4,141) | |||||
Acquisition of intangibles (in shares) | 60,000 | 480,000 | ||||||||
Acquisition of intangibles | 2,700 | 786 | 786 | 1,914 | ||||||
Balance at end of the year (in shares) at Dec. 31, 2022 | 65,111,616 | 155,955,584 | ||||||||
Balance at end of the year at Dec. 31, 2022 | 190,874 | 56,045 | $ 6 | $ 16 | 177,683 | (1,648) | (120,012) | 134,829 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Share-based compensation (in shares) | 1,754,519 | |||||||||
Share-based compensation | 30,020 | 9,389 | 9,389 | 20,631 | ||||||
Foreign currency translation adjustment | 5,290 | 1,651 | 1,651 | 3,639 | ||||||
Issuance of class A common stock upon exercise of warrants (in shares) | 5,521,274 | (5,521,274) | ||||||||
Issuance of Class A Common Stock upon exercise of Warrants | 0 | $ 1 | $ (1) | |||||||
Net loss | (60,055) | (18,305) | (18,305) | (41,750) | ||||||
Allocation of equity and non-controlling interests upon changes in RSILP ownership | 0 | 4,988 | 5,091 | (103) | (4,988) | |||||
Balance at end of the year (in shares) at Dec. 31, 2023 | 72,387,409 | 150,434,310 | ||||||||
Balance at end of the year at Dec. 31, 2023 | $ 166,129 | $ 53,768 | $ 7 | $ 15 | $ 192,163 | $ (100) | $ (138,317) | $ 112,361 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities | |||
Net loss | $ (60,055) | $ (134,332) | $ (71,092) |
Adjustments to reconcile net loss to net cash used in operating activities | |||
Share-based compensation expense | 30,020 | 18,691 | 24,912 |
Depreciation and amortization expense | 29,759 | 14,325 | 4,245 |
Deferred income tax | (255) | (50) | 64 |
Noncash lease expense | 697 | 616 | 355 |
Long-lived assets write off | 683 | 0 | 0 |
Change in fair value of earnout interests liability | 0 | 0 | 13,740 |
Change in fair value of warrant liabilities | 0 | 0 | (41,802) |
Changes in assets and liabilities: | |||
Players’ receivables | 658 | (5,345) | (5,050) |
Due from affiliates | 2,433 | (7,745) | 605 |
Prepaid expenses and other current assets | 722 | (3,879) | (4,562) |
Other assets | (950) | 312 | (1,406) |
Accounts payable | 1,806 | 23,331 | (5,546) |
Accrued expenses and other current liabilities | (8,816) | 17,472 | 22,077 |
Players’ liabilities | (377) | 18,352 | 15,660 |
Deferred royalty liabilities | (1,525) | (1,416) | (30) |
Operating lease liabilities | (732) | (653) | (356) |
Net cash used in operating activities | (5,932) | (60,321) | (48,186) |
Cash flows from investing activities | |||
Purchases of property and equipment | (1,291) | (4,157) | (3,847) |
Acquisition of gaming licenses | (7,279) | (5,484) | (23,535) |
Internally developed software costs | (22,619) | (16,770) | (4,091) |
Investments in equity securities | (470) | 0 | (1,500) |
Short-term investments | (3,061) | 0 | 0 |
Proceeds from (investment in) long-term time deposits | 1,705 | (689) | (748) |
Net cash used in investing activities | (33,780) | (28,990) | (37,002) |
Cash flows from financing activities | |||
Proceeds from shares issued for warrants | 0 | 0 | 131,588 |
Repurchase of common stock | 0 | 0 | (3,465) |
Principal payments of finance lease liabilities | (518) | (1,216) | (2,142) |
Distributions paid to non-controlling interest holders | 0 | 0 | (397) |
Net cash (used in) provided by financing activities | (518) | (1,216) | 125,584 |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 5,126 | (3,721) | (2,132) |
Net change in cash, cash equivalents and restricted cash | (35,104) | (94,248) | 38,264 |
Cash, cash equivalents and restricted cash, at the beginning of the year | 206,081 | 300,329 | 262,065 |
Cash, cash equivalents and restricted cash, at the end of the year | 170,977 | 206,081 | 300,329 |
Supplemental disclosure of noncash investing and financing activities: | |||
Right-of-use assets obtained in exchange for new or modified operating lease liabilities | 210 | 965 | 810 |
Right-of-use assets obtained in exchange for new or modified finance lease liabilities | 2,423 | 1,124 | 2,547 |
Non-cash redemption of Private Placement and Working Capital Warrants | 0 | 0 | 50,798 |
Non-cash settlement of Public Warrants | 0 | 0 | 77,509 |
Non-cash settlement of Earnout Interests Liability | 0 | 0 | 364,788 |
Reissuance of treasury stock | 0 | 0 | 850 |
Acquisition of gaming licenses in exchange for future minimum market access fees | 0 | 0 | 13,070 |
Allocation of equity and non-controlling interests upon changes in RSILP ownership | 4,988 | 4,140 | 11,288 |
Property and equipment purchases in Accounts payable and Accrued Expenses | 212 | (29) | 53 |
Capitalized intangible assets in Accounts payable and Accrued Expenses | 609 | 0 | 0 |
Supplemental disclosure of cash flow information: | |||
Cash paid for income taxes | 7,385 | 6,795 | 3,541 |
Cash paid for interest | 938 | 937 | 123 |
Trademark Asset | |||
Cash flows from investing activities | |||
Payments to acquire intangible assets | 0 | (1,890) | 0 |
Developed Technology | |||
Cash flows from investing activities | |||
Payments to acquire intangible assets | 0 | 0 | (3,281) |
Supplemental disclosure of noncash investing and financing activities: | |||
Stock issued to acquire intangible assets | 0 | 0 | 2,500 |
Media Content | |||
Cash flows from investing activities | |||
Payments to acquire intangible assets | (765) | 0 | 0 |
Class V Common Stock | Trademark Asset | |||
Supplemental disclosure of noncash investing and financing activities: | |||
Stock issued to acquire intangible assets | 0 | 2,400 | 0 |
Class A Common Stock | Trademark Asset | |||
Supplemental disclosure of noncash investing and financing activities: | |||
Stock issued to acquire intangible assets | $ 0 | $ 300 | $ 0 |
Description of Business
Description of Business | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business Rush Street Interactive, Inc. is a holding company organized under the laws of the State of Delaware and, through its main operating subsidiary, Rush Street Interactive, LP and its subsidiaries (collectively, “RSILP”), is a leading online gaming company that provides online casino and sports betting in the U.S., Canadian and Latin American markets. Rush Street Interactive, Inc. and its subsidiaries (including RSILP) are collectively referred to as “RSI” or the “Company.” The Company is headquartered in Chicago, IL. RSI launched its first social gaming website in 2015 and began accepting real-money bets in the United States in 2016. The Company establishes and utilizes subsidiaries to facilitate its operations in jurisdictions where the Company is licensed to operate. In 2018, RSI also became the first U.S.-based online gaming operator to launch in Colombia, which was an early adopting Latin American country to legalize and regulate online casino and sports betting nationally. In addition, RSI launched its real-money offering in Canada and Mexico during the second quarter of 2022. As of December 31, 2023, RSI offered real-money online casino, online sports betting and/or retail sports betting in the 15 U.S. states and three international jurisdictions as outlined in the table below. Jurisdictions Online Casino Online Sports Retail Sports Domestic: Arizona ü Colorado ü Delaware ü ü Illinois ü ü Indiana ü ü Iowa ü Louisiana ü Maryland ü ü Michigan ü ü ü New Jersey ü ü New York ü ü Ohio ü Pennsylvania ü ü ü Virginia ü ü West Virginia ü ü International: Colombia ü ü Ontario (Canada) ü ü Mexico ü ü |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). The consolidated financial statements include the accounts of the Company, its direct and indirect wholly owned subsidiaries, and all entities in which the Company has a controlling interest. RSI is deemed to have a controlling interest of RSILP through its wholly owned subsidiary RSI GP, LLC (“RSI GP”), which is the sole general partner of RSILP. For consolidated entities that are less than wholly owned, third party holdings of equity interests are presented as Non-controlling interests in the Company’s consolidated balance sheets and consolidated statements of changes in stockholders’ equity. The portion of net loss attributable to the non-controlling interests is presented as net loss attributable to non-controlling interests in the Company’s consolidated statements of operations, while the portion of comprehensive loss attributable to the non-controlling interests is reported as comprehensive loss attributable to non-controlling interests in the Company’s consolidated statements of comprehensive loss. All intercompany accounts and transactions have been eliminated upon consolidation. The Company is organized as an umbrella partnership-C corporation, or Up-C, structure, as a result of the transactions contemplated in the Business Combination Agreement, dated as of July 27, 2020 (as amended and/or restated from time to time, the “Business Combination Agreement” and the transactions contemplated thereby, the “Business Combination”). The Business Combination Agreement was entered among RSILP, the sellers set forth on the signature pages thereto (collectively, the “Sellers” and each, a “Seller”), dMY Sponsor, LLC (the “Sponsor”) and Rush Street Interactive GP, LLC, resulting in dMY Technology Group, Inc. (“dMY”) acquiring certain Class A Units of RSILP (the “RSILP Units”). The Business Combination was accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, dMY is treated as the acquired company and RSILP is treated as the acquirer for financial statement reporting purposes. Accordingly, for accounting purposes, the Business Combination was treated as the equivalent of RSILP issuing stock for the net assets of dMY, accompanied by a recapitalization. RSILP was determined to be the accounting acquirer based on evaluation of the following facts and circumstances: • RSILP’s existing members, through their ownership of RSI’s Class V Common Stock, have the largest portion of the voting rights in the Company; • The Board of Directors of the Company (the “Board”) and management are primarily composed of individuals associated with RSILP; and • RSILP is the larger entity based on historical operating activity and has the larger employee base. As an Up-C, substantially all of the assets of the combined company are held by RSILP and the Company’s primary assets are its equity interests in RSILP (which are held indirectly through wholly owned subsidiaries of the Company – RSI ASLP, Inc. (the “Special Limited Partner”) and RSI GP). The Company controls RSILP through RSI GP. As of December 31, 2023, the Company owned 32.49% of the RSILP Units and the holders of the non-controlling interest 67.51% of the RSILP Units. Neil G. Bluhm and his trusts and entities controlled by him and Richard Schwartz (collectively, the “Controlling Holders”) together as a group control a majority of the voting power of the Company’s outstanding common stock. As a result, RSI is a “controlled company” under the New York Stock Exchange’s corporate governance standards. Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. Such reclassifications had no impact on the Company’s reported total revenues, expenses, net loss, current assets, total assets, current liabilities, total liabilities, stockholders’ equity, non-controlling interests or cash flows. No reclassifications of prior period balances were material to the consolidated financial statements. Liquidity and Capital Resources The Company currently expects that its cash will be sufficient to fund its operating expenses and capital expenditure requirements for at least 12 months from the date of issuance of this report based on future spend assumptions. The Company experienced negative operating cash flows of $5.9 million, $60.3 million and $48.2 million for the years ended December 31, 2023, 2022 and 2021, respectively. The Company had working capital totaling $90.9 million as of December 31, 2023. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Significant estimates and assumptions reflected in the consolidated financial statements relate to and include, but are not limited to, the valuation of share-based awards, the earnout interests liability, the warrant liabilities and acquired intangibles; internally developed software; long-lived assets and investments in equity; the estimated useful lives of property and equipment and intangible assets; redemption rate assumptions associated with the loyalty program and other discretionary player bonuses; accrued expenses; determination of the incremental borrowing rate to calculate operating lease liabilities and finance lease liabilities; and deferred taxes and amounts associated with the tax receivable agreement (the “Tax Receivable Agreement” or “TRA”) entered into in connection with the closing on December 29, 2020 of the Business Combination (the “Closing”). Segment Reporting Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the Chief Operating Decision Maker (“CODM”) in making decisions regarding resource allocation and assessing performance. The Company views its operations and manages its business in one operating segment. Cash and Cash Equivalents and Restricted Cash Cash and cash equivalents consist of highly liquid, unrestricted savings, checking, instant access internet banking accounts, money market funds and certificates of deposits with original maturities of 90 days or less at acquisition. Restricted cash includes any cash and cash equivalents held by the Company that are legally restricted as to withdrawals or usage. This consists of certain deposits that are restricted under regulatory requirements. Regardless of whether customer deposits are legally restricted, the Company maintains separate bank accounts to segregate cash that resides in customers’ accounts from operational funds. The following table reconciles cash and cash equivalents and restricted cash in the consolidated balance sheets to the totals shown on the consolidated statements of cash flows: December 31, ($ in thousands) 2023 2022 Cash and cash equivalents (1) $ 168,330 $ 179,723 Restricted cash 2,647 26,358 Total cash, cash equivalents and restricted cash $ 170,977 $ 206,081 (1) The Company had cash equivalents of $78.4 million and $1.0 million as of December 31, 2023 and 2022, respectively. Cash equivalents are composed of money market funds and certificates of deposits with original maturities of 90 days or less. Money market funds of $68.7 million are valued using quoted market prices as of December 31, 2023. The Company did not have money market funds as of December 31, 2022. Players Receivables Players receivables consist of cash deposits from customers that the Company has not yet received. Players receivables are reported at the amount that the Company expects to collect from customers, generally via third-party payment processors. These receivables arise due to the timing difference between a customer’s deposit and the Company’s receipt of that deposit from the payment processor. The amounts are generally outstanding for a short period of time. On a periodic basis, the Company evaluates its players receivables and establishes an allowance for doubtful accounts based on a specific review of the accounts as well as historical collection experience and current economic conditions. No allowance for doubtful accounts was recorded for the periods presented in these consolidated financial statements. Due from Affiliates Due from affiliates consists of amounts that are expected to be collected from certain affiliated land-based casino partners. In certain cases, the affiliate casino maintains the bank account that processes cash deposits and withdrawals for RSI customers. Accordingly, at any point in time, the Company will record a receivable from the affiliate, representing the Company’s total revenue (with RSI customers) that was collected by the affiliate, less consideration payable to the affiliate for use of its license, which is offset by any consideration received from the affiliate based on the terms of the applicable agreement. On a periodic basis, the Company evaluates the collectability of amounts due from affiliates and establishes an allowance for amounts not expected to be collected. No allowance was recorded for the periods presented in these consolidated financial statements. See Note 13 for disclosure on related parties. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist primarily of prepaid expenses and a short-term investment. Prepaid expenses consist of various advance payments for goods or services to be received in the future. These costs include insurance, subscriptions, marketing, other contracted services and deposits paid in advance. Prepaid expenses totaled $7.5 million and $5.6 million as of December 31, 2023 and 2022, respectively. The short-term investment consists of a certificate of deposit with an original maturity greater than three months but less than one year. As of December 31, 2023, the Company had a short-term investment of $3.1 million. The Company did not have any short-term investments as of December 31, 2022. Property and Equipment, net Property and equipment are carried at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful life of the asset. Leasehold improvements depreciation is computed over the shorter of the remaining lease term or estimated useful life of the asset. Additions and improvements are capitalized, while repairs and maintenance are expensed as incurred. Useful lives of each asset class are as follows: Asset Useful Life Computers, software and related equipment 3 years Furniture and fixtures 4 years Operating equipment and servers 5 years Leasehold improvements Lesser of the lease terms or the estimated useful lives of the improvements, generally 1–10 years Intangible Assets, Net License Fees, Net The Company incurs costs in connection with operating in certain jurisdictions, including license applications fees, market access payments to strategic partners and related renewals or extensions. These costs are capitalized as an intangible asset and amortized over the estimated useful life of the asset using the straight-line method. In certain markets, the Company agrees to pay minimum market access royalties to its partner, which is considered an integral cost in connection with operating in certain jurisdictions. The Company records fixed minimum royalty payments as intangible assets with an offset to deferred royalty liabilities, both of which are included on the consolidated balance sheets. The Company’s access to operate in a particular market is often dependent upon the continued viability of its strategic partner in that market. The useful life is the period over which the asset is expected to contribute directly or indirectly to the Company’s cash flows. The remaining useful life of license fee intangible assets is evaluated at least annually. Internally Developed Software Software that is developed for internal use is accounted for pursuant to Accounting Standards Codification (“ASC”) 350-40, Intangibles, Goodwill and Other - Internal-Use Software . Qualifying costs incurred to develop internal-use software are capitalized when (i) the preliminary project stage is completed, (ii) management has authorized further funding for the completion of the project and (iii) it is probable that the project will be completed and perform as intended. These capitalized costs include compensation for employees who develop internal-use software and external costs related to development and implementation of internal-use software. Capitalization of these costs ceases once the project is substantially complete and the software is ready for its intended purpose. Internally developed software is amortized using the straight-line method over an estimated useful life of three Trademark Asset On June 10, 2022, the Company entered into an agreement to purchase all of the equity interests of Rush Street Productions, LLC, a Delaware limited liability company (“RSP”), in exchange for $1.5 million cash (net of $0.7 million cash acquired), 480,000 RSILP Units and the same number of newly issued shares of Class V Common Stock, par value $0.0001 per share of the Company (the “Class V Common Stock”), valued at $2.4 million, and 60,000 shares of Class A Common Stock of the Company, par value $0.0001 per share of the Company (the “Class A Common Stock”), valued at $0.3 million. The Company also assumed $0.5 million of outstanding liabilities and incurred $0.4 million of transaction costs directly attributable to the acquisition. To account for the transaction, the Company applied the definition of a business in ASC 805-10, Business Combinations – Overall, and concluded that the asset set acquired does not constitute a business as substantially all of the fair value of the acquired assets was concentrated in a single asset. Therefore, the transaction has been accounted for as an asset acquisition in accordance with ASC 805-50, Business Combinations — Related Issues . The acquired trademark asset represents an intangible asset that is recognized at its relative fair value in accordance with ASC 350-30, General Intangibles Other Than Goodwill . Goodwill is not recognized in an asset acquisition, and as such, any consideration that exceeds the fair value of the net assets acquired is allocated to the identifiable assets based on relative fair values. The Company capitalized a $5.1 million trademark intangible asset representing the total consideration paid of $4.2 million, assumed liabilities of $0.5 million, and legal and consulting fees incurred that were directly attributable to the asset acquisition of $0.4 million. The asset is recognized in intangible assets, net on the Company’s consolidated balance sheets as of December 31, 2023 and 2022 and is amortized over the estimated useful life of five years using the straight-line method. The asset acquisition is presented on the consolidated statement of cash flows as net cash used in investing activities. Developed Technology On December 21, 2021, the Company entered into an agreement to purchase certain assets from Run It Once, Ltd. (“RIO”) in exchange for $3.3 million cash and 158,127 Class A Common Shares valued at $2.5 million. To account for the transaction, the Company applied the definition of a business in ASC 805-10, Business Combinations – Overall, and concluded that the asset set acquired does not constitute a business as the acquired assets did not include the necessary inputs, substantive processes, and outputs needed to operate as a business. Thus, the transaction has been accounted for as an asset acquisition in accordance with ASC 805-50, Business Combinations — Related Issues . The acquired intellectual property represents developed technology intangible assets that are recognized at their relative fair value in accordance with ASC 350-30, General Intangibles Other Than Goodwill . Goodwill is not recognized in an asset acquisition and, as such, any consideration that exceeds the fair value of the net assets acquired is allocated to the identifiable assets based on relative fair values. The Company capitalized a $5.9 million developed technology intangible asset, representing the total consideration paid of $5.8 million and an incremental $0.1 million related to legal fees directly attributable to the asset acquisition incurred by the Company. The asset is recognized in intangible assets, net on the Company’s consolidated balance sheets as of December 31, 2023 and 2022. The asset is amortized over the estimated useful life of eight years using the straight-line method. The asset acquisition is presented on the consolidated statement of cash flows as net cash used in investing activities. Media Content Production Costs The Company capitalizes costs associated with the development and production of media content in accordance with ASC 350, Intangibles - Goodwill and Other . The asset is recognized in intangible assets, net in the Company’s consolidated balance sheet as of December 31, 2023 and is amortized over the estimated useful life of two years. Investments in Equity The Company accounts for investments in equity that are within the scope of ASC 321-10, Investments - Equity Securities (“ASC 321-10”), as either (1) investments with a readily determinable fair value, which are recorded at fair value or (2) investments without a readily determinable fair value, which are recorded at cost less any impairment. Equity investments that are initially concluded to not have a readily determinable fair value are reassessed at each reporting period. If the Company identifies observable price changes in orderly transactions for the identical or a similar investment of the same issuer, it measures the equity security at fair value as of the date that the observable transaction occurred using valuation techniques that are permitted under ASC 820, Fair Value Measurement . As of December 31, 2023 and 2022, the Company had investments in equity of $2.0 million and $1.5 million, respectively. The equity investments are accounted for in accordance with ASC 321-10, and the Company accounts for the equity investments at cost less impairment because there are no readily determinable fair values for these investments as of December 31, 2023 and 2022. No impairment was recorded during the years ended December 31, 2023 and 2022. The investments are recognized in other assets on the Company’s consolidated balance sheets. Impairment of Long-Lived Assets The Company’s long-lived assets primarily consist of property and equipment, operating lease right-of-use assets, finance lease right-of-use assets and finite-lived intangible assets (i.e., license fees, internally developed software, developed technology, trademark assets and media content production costs). The Company evaluates long-lived assets for indicators of impairment quarterly or when events or changes in circumstances indicate that their carrying amounts may not be recoverable. The factors that would be considered by management in performing this assessment include current operating results, trends and prospects, the manner in which the long-lived asset is used and the effects of obsolescence, demand, competition and other economic factors. If indicators of impairment are identified, the Company performs an undiscounted cash flow analysis of the long-lived assets. Asset groups are written down only to the extent that their carrying value is lower than their respective fair value. Fair values of the asset group are determined by discounting the cash flows at a rate that approximates the cost of capital of a market participant. Players’ Liabilities The Company’s players’ liabilities include liabilities for customer account balances, the incremental progressive jackpot reserve, and the expected future payout relating to customers’ unredeemed bonus store points and unused discretionary bonus incentives. Customer cash account balances consist of customer deposits, cash winnings and pending cash wagers, less customer cash losses, withdrawals and tax withholdings. The Company’s restricted cash balance, players receivables balance and the value of surety bonds held for the benefit of customers will equal or exceed the customer cash account balances. Deferred Royalty The Company records liabilities for minimum royalty payments related to licensing and market access agreements. These liabilities are recorded on the consolidated balance sheets at the present value of future payments discounted using a rate that reflects the duration of the agreement. The deferred royalty liability is accreted through interest expense in the Company’s consolidated statements of operations. The Company records deferred royalty liabilities as either current deferred royalty liabilities, or non-current deferred royalty liabilities based on the timing of future payments. Warrant Liabilities As part of dMY’s initial public offering, dMY issued to third-party investors 23.0 million units, each consisting of one share of dMY’s Class A common stock and one-half of one warrant, at a price of $10.00 per unit. Each whole warrant entitled the holder to purchase one share of Class A common stock at an exercise price of $11.50 per share (the “Public Warrants”). Simultaneously with its initial public offering, dMY sold 6,600,000 private placement warrants to the Sponsor (the “Private Placement Warrants”) and it issued an additional 75,000 warrants to the Sponsor upon the Closing in connection with converting certain working capital loans into warrants (the “Working Capital Warrants” and together with the Private Placement Warrants, the “Private Warrants” and the Private Warrants together with the Public Warrants, the “Warrants”). Each Private Warrant allowed the Sponsor to purchase one share of Class A Common Stock at $11.50 per share. Subsequent to the Business Combination, 11,500,000 Public Warrants and 6,675,000 Private Warrants remained outstanding. None of the Public Warrants or Private Warrants remained outstanding as of December 31, 2023 and 2022. The Private Warrants and the shares of Class A Common Stock issuable upon the exercise of the Private Warrants were not transferable, assignable or salable until after the completion of a business combination, subject to certain limited exceptions. Additionally, the Private Warrants were exercisable for cash or on a cashless basis, at the holder’s option, and were non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants were held by someone other than the initial purchasers or their permitted transferees, the Private Warrants would have become redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. The Company evaluated the Warrants pursuant to ASC 815-40 and concluded that they did not meet the criteria to be classified in stockholders’ equity. Specifically, the exercise of these Warrants may be settled in cash upon the occurrence of a tender offer or exchange that involves 50% or more of our stockholders holding Class A Common Stock. Because not all of the stockholders need to participate in such tender offer or exchange to trigger the potential cash settlement and the Company does not control the occurrence of such an event, the Company concluded that the Warrants did not meet the conditions to be classified in equity. Because the Warrants met the definition of a derivative under ASC 815-40, the Company records these Warrants as liabilities on its consolidated balance sheets at fair value as of each reporting date, with subsequent changes in their respective fair values recognized in its consolidated statements of operations. See Note 7 for additional discussion of the Warrants. Earnout Interests Liability Earnout interests represent a freestanding financial instrument classified as liabilities on the accompanying consolidated balance sheets as the Company determined that these financial instruments are not indexed to the Company’s own equity in accordance with ASC 815, Derivatives and Hedging . Earnout interests were initially recorded at fair value in the Business Combination and were adjusted to fair value at each reporting date with changes in fair value recorded in change in fair value of earnout interests liability in the consolidated statements of operations. None of the earnout interests remained outstanding as of December 31, 2023 and 2022. See Note 8 for additional discussion of earnout interests. Surety Bonds As of December 31, 2023, the Company had been issued $28.0 million in surety bonds that are used to satisfy regulatory requirements related to securing cash held for the benefit of customers and $4.6 million in surety bonds to satisfy regulatory requirements necessary to operate in certain jurisdictions. As of December 31, 2022, the Company had been issued $3.6 million in surety bonds to satisfy regulatory requirements necessary to operate in certain jurisdictions. There have been no claims against any of the Company’s surety bonds and the likelihood of future claims is remote. Concentrations of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of operating cash, restricted cash, cash equivalents, and short term investments. The Company maintains cash, restricted cash, cash equivalents, and short term investments primarily across nine financial institutions within separate bank accounts. Any loss incurred, or a lack of access, to such funds could have a significant adverse impact on the Company’s financial condition, results of operations and cash flows. Although the Company maintains balances with certain institutions in excess of the federally insured limits, the Company is not subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships. As of December 31, 2023 and 2022, the Company has not experienced losses on these accounts. Leases The Company determines whether an arrangement is or contains a lease at contract inception. The Company accounts for leases in accordance with ASC 842, Leases , under which arrangements meeting the definition of a lease are classified as operating or finance leases and are recorded on the consolidated balance sheets as both a right-of-use asset and a lease liability. The Company elects to apply the practical expedient that allows for the combination of lease and non-lease components for all asset classes. The lease classification evaluation begins at the lease commencement date. The lease term used in the evaluation includes the non-cancellable period for which the Company has the right to use the underlying asset, together with renewal option periods when the exercise of the renewal option is reasonably certain. For leases with an initial term greater than 12 months, a related lease liability is recorded on the consolidated balance sheets at the present value of future payments discounted using the interest rate implicit in the lease and if not determinable, the estimated fully collateralized incremental borrowing rate (discount rate) corresponding with the lease term. In addition, a right-of-use asset is recorded as the initial amount of the lease liability, plus any lease payments made to the lessor before or at the lease commencement date and any initial direct costs incurred, less any tenant improvement allowance incentives received. Tenant incentives are amortized through the right-of-use asset as a reduction of lease expense over the lease term. The difference between the minimum rents paid and the straight-line rent is reflected within the associated right-of-use asset. Certain leases contain provisions that require variable payments consisting of common area maintenance costs (i.e., variable lease cost). Variable lease costs are expensed as incurred. The Company made an accounting policy election to exclude any short-term lease (i.e., leases with a term of twelve months or less) from the balance sheet. Short-term lease expense is recognized on a straight-line basis over the lease term. When the interest rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate corresponding with the lease term. As the Company does not have any outstanding debt, this rate is determined based on prevailing market conditions and comparable company and credit analysis. The discount rate is reassessed upon a modification that is not accounted for as a separate contract. Revenue Recognition Revenue is recognized in accordance with ASC Topic 606, Revenue from Contracts with Customers , when control of the promised goods or services is transferred to the customer, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company determines revenue recognition through the following steps: • Identify the contract with the customer • Identify the performance obligations in the contract • Determine the transaction price • Allocate the transaction price to the performance obligations in the contract • Recognize revenue when, or as, the company satisfies a performance obligation The Company’s revenue from contracts with customers consists of online casino, online sports betting, retail sports betting and social gaming. Online casino and online sports betting Online casino offerings typically include the full suite of games available in land-based casinos, such as table games (i.e., blackjack and roulette) and slot machines. The Company generates revenue from these offerings through hold, or gross winnings, as customers play against the house. Online casino revenue is generated based on total customer bets less amounts paid to customers for winning bets, less other incentives awarded to customers, plus or minus the change in the progressive jackpot liability. Online sports betting involves a user placing a bet on the outcome of a sporting event, sports-related activity, or a series of the same, with the chance to win a pre-determined amount, often referred to as fixed odds. Online sports betting revenue is generated by setting odds such that there is a built-in theoretical margin in each bet offered to customers. Online sports betting revenue is generated based on total customer bets less amounts paid to customers for winning bets, less other incentives awarded to customers, plus or minus the change in unsettled bets. The Company provides various incentives to promote customer engagement, many of which allow customers to place bets without using their own funds. For some incentive programs, benefits are provided to customers based only on past play and represent an option that grants the customer a material right. Other benefits that are provided to customers are more discretionary in nature and may not be related to the customer’s level of play. Performance obligations related to online gaming and sports betting transactions include (1) servicing the customer’s bet, which is fulfilled when the outcome of the bet is known and (2) transferring additional goods or services to a player for which the Company has received consideration, such as bonus store points or other discretionary bonus incentives. Bonus store points as well as discretionary bonus incentives, such as bonus money and bonus bets (collectively referred to herein as “customer bonuses”) are recognized as a reduction to revenue upon issuance of the incentive and as revenue upon redemption by the customer. Reductions to revenue include estimates for the stand-alone selling price of customer bonuses and the percentage of customer bonuses that are expected to be redeemed. The expected redemption percentage is based on historical redemption patterns and considers current information or trends. The estimated redemption rate is evaluated each reporting period. The Company does not believe that there is a reasonable likelihood that there will be a material change in the future estimates or assumptions used to calculate the estimated redemption rate. Adjustments to ea |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Disaggregation of revenue for the years ended December 31, 2023, 2022 and 2021 is as follows: Years Ended ($ in thousands) 2023 2022 2021 Online casino and online sports betting $ 674,059 $ 576,573 $ 480,065 Retail sports betting 12,848 11,713 3,828 Social gaming 4,254 3,926 4,212 Total revenue $ 691,161 $ 592,212 $ 488,105 The following table presents the Company’s revenue by geographic region for the years ended December 31, 2023, 2022 and 2021: Years Ended ($ in thousands) 2023 2022 2021 United States and Canada $ 611,868 $ 539,887 $ 452,607 Latin America, including Mexico 79,293 52,325 35,498 Total revenue $ 691,161 $ 592,212 $ 488,105 Deferred revenue associated with online casino and online sports betting revenue and retail sports betting revenue includes unsettled customer bets and unredeemed customer incentives and is included within Player’s liabilities in the consolidated balance sheets. The deferred revenue activity for the years ended December 31, 2023, 2022 and 2021 was as follows: Years Ended ($ in thousands) 2023 2022 2021 Deferred revenue, beginning of period $ 7,840 $ 4,637 $ 1,797 Deferred revenue, end of period 7,013 7,840 4,637 Revenue recognized in the year from amounts included in deferred revenue at the beginning of the year 7,840 4,637 1,797 |
Intangible Assets, Net
Intangible Assets, Net | 12 Months Ended |
Dec. 31, 2023 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Intangible Assets, Net | Intangible Assets, Net As set forth in the table below, intangible assets, net as of December 31, 2023 and 2022 are $74.9 million and $69.0 million, respectively. The Company has the following intangible assets, net as of December 31, 2023 and 2022, respectively: ($ in thousands) Weighted Average Gross Accumulated Net License Fees December 31, 2023 7.75 $ 61,015 $ (25,946) $ 35,069 December 31, 2022 8.44 $ 54,334 $ (12,363) $ 41,971 Internally Developed Software December 31, 2023 2.37 $ 43,868 $ (12,601) $ 31,267 December 31, 2022 2.51 $ 20,860 $ (3,490) $ 17,370 Developed Technology December 31, 2023 6.00 $ 5,931 $ (1,483) $ 4,448 December 31, 2022 7.00 $ 5,931 $ (741) $ 5,190 Trademark Asset December 31, 2023 3.42 $ 5,088 $ (1,611) $ 3,477 December 31, 2022 4.42 $ 5,088 $ (594) $ 4,494 Content December 31, 2023 1.60 $ 785 $ (172) $ 613 December 31, 2022 N/A $ — $ — $ — The Company recorded amortization expense on intangible assets of $24.7 million, $11.6 million and $3.0 million for the years ended December 31, 2023, 2022 and 2021, respectively. At December 31, 2023, estimated future amortization of intangible assets is as follows: ($ in thousands) Year ended December 31, 2024 $ 21,426 Year ended December 31, 2025 18,126 Year ended December 31, 2026 11,818 Year ended December 31, 2027 6,141 Year ended December 31, 2028 4,888 Thereafter 12,475 Total $ 74,874 |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | Property and Equipment, Net As set forth in the table below, property and equipment, net as of December 31, 2023 and 2022 are $8.6 million and $9.8 million, respectively. The balances as of December 31, 2023 and 2022 also include finance lease right-of-use assets, net. The balances consist of the following: December 31, ($ in thousands) 2023 2022 Computers, software and related equipment $ 5,541 $ 4,050 Operating equipment and servers 4,779 4,610 Furniture 647 600 Leasehold improvements 658 640 Property and equipment not yet placed into service 610 816 Total property and equipment 12,235 10,716 Less: accumulated depreciation (7,641) (3,818) 4,594 6,898 Finance lease right-of-use assets 5,519 3,112 Less: accumulated amortization (1,502) (246) 4,017 2,866 Property and equipment, net $ 8,611 $ 9,764 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2023 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | Accrued Expenses and Other Current Liabilities As set forth in the table below, accrued expenses as of December 31, 2023 and 2022 are $51.3 million and $64.9 million, respectively. The following table provides a summary of the accrued expenses at December 31, 2023 and 2022: December 31, ($ in thousands) 2023 2022 Accrued compensation and related expenses $ 13,896 $ 10,077 Accrued operating expenses 21,748 24,256 Accrued marketing expenses 9,319 27,315 Accrued administrative expenses 5,506 1,622 Other 843 1,633 Total accrued expenses $ 51,312 $ 64,903 |
Warrant Liabilities
Warrant Liabilities | 12 Months Ended |
Dec. 31, 2023 | |
Warrants and Rights Note Disclosure [Abstract] | |
Warrant Liabilities | Warrant Liabilities As part of dMY’s initial public offering, dMY issued to third-party investors 23.0 million units, each consisting of one share of dMY Class A common stock and one-half of one Public Warrant, at a price of $10.00 per unit. Each whole Public Warrant entitled the holder to purchase one share of Class A Common Stock at an exercise price of $11.50 per share. Simultaneously with the dMY initial public offering, dMY sold 6,600,000 Private Placement Warrants to the Sponsor and issued an additional 75,000 Working Capital Warrants to the Sponsor upon the Closing in connection with converting certain working capital loans into warrants. Each Private Warrant allows the Sponsor to purchase one share of Class A Common Stock at $11.50 per share. The Company classified the Warrants pursuant to ASC 815-40 as derivative liabilities on its consolidated balance sheets at fair value as of each reporting date, with subsequent changes in their respective fair values recognized in its consolidated statements of operations. Public Warrants On February 22, 2021, the Company announced the redemption of all the Public Warrants, which were exercisable for an aggregate of approximately 11.5 million shares of Class A Common Stock at a price of $11.50 per share. During the year ended December 31, 2021, 11,442,389 Public Warrants were exercised, resulting in cash proceeds of approximately $131.6 million and the issuance of 11,442,389 shares of Class A Common Stock. None of the Public Warrants remained outstanding as of December 31, 2023 and 2022. The Company determined the fair value of its Public Warrants based on the publicly listed trading price of such warrants as of the valuation date. Accordingly, the Public Warrants were classified as Level 1 financial instruments. The aggregate fair value of the Public Warrants on the dates of exercise throughout March 2021 was $77.5 million. Private Warrants On March 26, 2021, the Private Warrants were exercised in full on a cashless basis, resulting in the issuance of 2,571,808 shares of Class A Common Stock. None of the Private Warrants remained outstanding as of December 31, 2023 and 2022. The estimated fair value of the Private Warrants was determined with Level 3 inputs using the Black-Scholes model. The significant inputs and assumptions in this method are the stock price, exercise price, volatility, risk-free rate, and term or maturity. The underlying stock price input is the closing stock price as of each valuation date and the exercise price is the price as stated in the warrant agreement. The volatility input was determined using the historical volatility of comparable publicly traded companies that operate in a similar industry or compete directly against the Company. Volatility for each comparable publicly traded company is calculated as the annualized standard deviation of daily continuously compounded returns. The Black-Scholes analysis is performed in a risk-neutral framework, which requires a risk-free rate assumption based upon constant-maturity treasury yields, which are interpolated based on the remaining term of the Private Warrants as of each valuation date. The term/maturity is the duration between each valuation date and the maturity date, which is five years following the Closing, or December 29, 2025. The Private Warrants were valued as of December 31, 2020 and March 26, 2021 (the exercise date). The following table provides quantitative information regarding Level 3 fair value measurement inputs at their measurement dates: March 26, December 31, Exercise price $ 11.50 $ 11.50 Stock price $ 15.96 $ 22.76 Volatility 42.6% 41.4% Term (years) 4.77 5.00 Risk-free interest rate 0.76% 0.37% The fair value of the Private Warrants was $50.8 million as of March 26, 2021. The Company recorded $41.8 million to change in fair value of warrant liabilities on the Company’s consolidated statement of operations, representing the change in fair value of the Public Warrants and Private Warrants from December 31, 2020 through the dates of exercise. The following table summarizes the fair values of warrant liabilities and change in fair value at each measurement date: ($ in thousands) Public Warrants (Level 1) Private Warrants (Level 3) Total Fair value of warrants at December 31, 2020 $ 88,079 $ 82,030 $ 170,109 Change in fair value of warrant liability (10,570) (31,232) (41,802) Fair value of warrants at redemption (77,509) (50,798) (128,307) Fair value of warrants at December 31, 2021 $ — $ — $ — |
Earnout Interests Liability
Earnout Interests Liability | 12 Months Ended |
Dec. 31, 2023 | |
Earnout Interests Liability [Abstract] | |
Earnout Interests Liability | Earnout Interests Liability In connection with the consummation of the Business Combination as further described in Note 1, (i) 1,212,813 shares of Class A Common Stock held by the independent directors of dMY, consisting of Darla Anderson, Francesca Luthi and Charles E. Wert, together with the Sponsor (collectively, the “Founder Holders”) that formerly constituted shares of Class B common stock of dMY held by the Founder Holders, (ii) 1,212,813 Issued RSILP Units issued to the Company in connection with the Business Combination, (iii) 15,000,000 Retained RSILP Units held by the Sellers, and (iv) 15,000,000 shares of Class V Common Stock issued to the Sellers by the Company in connection with the Business Combination (collectively, the “Earnout Interests”), became subject to certain restrictions on transfer and voting and potential forfeiture pending the achievement (if any) of certain earnout targets. The earnout targets included (a) a change of control within three years of the Closing, (b) achieving certain revenue targets for the 2021 year, and (c) achieving certain VWAPs within three years of the Closing. Earnout interests represented a freestanding financial instrument initially classified as liabilities on the accompanying consolidated balance sheets as the Company determined that these financial instruments were not indexed to the Company’s own equity in accordance with ASC 815, Derivatives and Hedging . Earnout interests were initially recorded at fair value and were adjusted to fair value at each reporting date with changes in fair value recorded in change in fair value of earnout interests liability in the consolidated statements of operations. The range and weighted-average of the significant inputs used to fair value Level 3 recurring liabilities during the year ended December 31, 2020, along with the valuation techniques used, are shown in the following table: Fair Value Valuation Observable (O) or Range Earnout interests liability $ 351,048 Option pricing model Share price (O) $21.51 - $21.65 Volatility (U) 54.6% Term (U) 2.99 years Risk-free rate (O) 0.17% The share price input is based on the Class A Common Stock trading price at the valuation date. The volatility input was determined using the Guideline Public Companies’ daily trading activity. Daily volatilities were calculated based on the daily trading activity using a historical lookback period commensurate with the maturity. The selected volatility was the average of the Guideline Public Companies’ volatility for the period. The term input represents the time to expiration of the earnout interests. The risk-free rate input is based on the 3-year U.S. Treasury bond rate in effect at the date of the grant. On January 13, 2021, the earnout interests were fully earned and no longer subject to the applicable restrictions on transfer and voting because the VWAP exceeded $14.00 per share for 10 trading days within a 20 consecutive trading day period following the Closing. As a result, the earnout interests liability was reclassed to equity resulting in 1,212,813 shares of Class A Common Stock held by the Founder Holders (as defined below) and 15,000,000 shares of Class V Common Stock and RSILP Units issued to the Sellers (i.e., non-controlling interests) that were no longer subject to the applicable restrictions. The Company recorded $13.7 million to change in fair value of earnout interests liability on the Company’s consolidated statement of operations, representing the change in fair value of the earnout interests from December 31, 2020 through January 13, 2021, when the earnout interests were no longer subject to the restrictions. Earnout Interests Liability ($ in thousands) Total December 31, 2020 $ 351,048 Change in fair value of earnout interests liability 13,740 Settlement of earnout interests liability (364,788) December 31, 2021 $ — |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Authorized Capital Stock The total amount of the Company’s authorized capital stock consists of 951,000,000 shares, consisting of (i) 1,000,000 shares of preferred stock, par value $0.0001 per share (“Preferred Stock”), (ii) 750,000,000 shares of Class A Common Stock, and (iii) 200,000,000 shares of Class V Common Stock (together with the Class A Common Stock, the “Common Stock”). Preferred Stock The Board has the authority to issue shares of preferred stock at any time and from time to time, to provide, out of the unissued shares of Preferred Stock, for one or more series of Preferred Stock and, with respect to each such series, to fix the number of shares constituting such series and the designation of such series, the voting powers (if any) of the shares of such series, and the powers, preferences and relative, participating, optional or other special rights, if any, and any qualifications, limitations or restrictions thereof, of the shares of such series and to cause to be filed with the Secretary of State of the State of Delaware a certificate of designations with respect thereto. The powers, preferences and relative, participating, optional and other special rights of each series of Preferred Stock, and the qualifications, limitations or restrictions thereof, if any, may differ from those of any and all other series at any time outstanding. As of December 31, 2023 and 2022, there were no shares of preferred stock outstanding. Common Stock As of December 31, 2023, there were 72,387,409 shares of Class A Common Stock outstanding and 150,434,310 shares of Class V Common Stock outstanding. As of December 31, 2022, there were 65,111,616 shares of Class A Common Stock outstanding and 155,955,584 shares of Class V Common Stock outstanding. Voting Rights Each holder of record of Common Stock shall be entitled to one vote for each share of Common Stock held of record by such holder on all matters on which stockholders generally are entitled to vote or holders of Common Stock as a separate class are entitled to vote, including the election or removal of directors (whether voting separately as a class or together with one or more classes of the Company’s capital stock); provided, however, that to the fullest extent permitted by law, holders of Common Stock shall have no voting power with respect to, and shall not be entitled to vote on, any amendment to the Company’s Second A&R Certificate of Incorporation (including any certificate of designations relating to any series of Preferred Stock) that relates solely to the terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together with the holders of one or more other such series, to vote thereon pursuant to the Company’s Second A&R Certificate of Incorporation (including any certificate of designations relating to any series of Preferred Stock) or pursuant to the Delaware General Corporation Law. The holders of Class A Common Stock and Class V Common Stock having the right to vote in respect of such Common Stock shall vote together as a single class (or if the holders of one or more series of Preferred Stock are entitled to vote together with the holders of Common Stock having the right to vote in respect of such Common Stock, as a single class with the holders of such other series of Preferred Stock) on all matters submitted to a vote of the stockholders having voting rights generally. Dividend Rights Subject to applicable law and the rights, if any, of the holders of any outstanding series of Preferred Stock or any class or series of stock having a preference over or the right to participate with the Class A Common Stock with respect to the payment of dividends and other distributions in cash, stock of any corporation or property of the Company, the holders of Class A Common Stock shall be entitled to receive ratably such dividends and other distributions as may from time to time be declared by the Board in its discretion out of the assets of the Company that are by law available therefor at such times and in such amounts as the Board in its discretion shall determine. Dividends and other distributions shall not be declared or paid on the Class V Common Stock. Rights Upon Liquidation In the event of any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company, after payment or provision for payment of the debts and other liabilities of the Company and of the preferential and other amounts, if any, to which the holders of Preferred Stock or any class or series of stock having a preference over the Class A Common Stock as to distributions upon dissolution or liquidation or winding up shall be entitled, the holders of all outstanding shares of Class A Common Stock shall be entitled to receive the remaining assets of the Company available for distribution ratably in proportion to the number of shares held by each such stockholder. The holders of shares of Class V Common Stock shall not be entitled to receive any assets of the Company in the event of any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company. Cancellation of Class V Common Stock In the event that any outstanding share of Class V Common Stock shall cease to be held directly or indirectly by the holder of the corresponding RSILP Unit (as defined in the RSILP A&R LPA), as set forth in the books and records of RSILP, including by virtue of any divestiture by such holder of such corresponding RSILP Unit, such share of Class V Common Stock shall automatically and without further action on the part of the Company or any holder of Class V Common Stock be transferred to the Company and cancelled for no consideration. The Company shall not issue additional shares of Class V Common Stock after the Closing of the transactions contemplated by the Business Combination, other than in connection with the valid issuance of RSILP Units in accordance with the RSILP A&R LPA. Other Rights If the Company at any time combines or subdivides (by any stock split, stock dividend, recapitalization, reorganization, merger, amendment of the Company’s Second A&R Certificate of Incorporation, scheme, arrangement or otherwise) the number of shares of Class A Common Stock into a greater or lesser number of shares, the shares of Class V Common Stock outstanding immediately prior to such subdivision shall be proportionately similarly combined or subdivided such that the ratio of shares of outstanding Class V Common Stock to shares of outstanding Class A Common Stock immediately prior to such subdivision shall be maintained immediately after such combination or subdivision. Any such adjustment shall become effective at the close of business on the date the combination or subdivision becomes effective. Non-Controlling Interest The non-controlling interest represents the RSILP Units held by holders other than the Company. The non-controlling interests’ ownership percentage can fluctuate over time as the holders of the RSILP Units elect to exchange for Class A Common Stock. The Company consolidates the financial position and results of operations of RSILP and reflects the proportionate interest held by the holders of RSILP Units other than the Company as non-controlling interest. The non-controlling interests owned 67.51% and 70.55% of the RSILP Units outstanding as of December 31, 2023 and 2022, respectively. The following table summarizes the changes in non-controlling interests owned: Non-Controlling Interest % Non-controlling interest % as of December 31, 2022 70.55 % Issuance of Class A Common Stock upon RSILP Unit Exchanges (2.49) % Issuance of Class A Common Stock in connection with the vesting of certain share-based equity grants (0.55) % Non-controlling interest % as of December 31, 2023 67.51 % The non-controlling interests owned 70.55% and 72.20% of the RSILP Units outstanding as of December 31, 2022 and 2021, respectively. The following table summarizes the changes in non-controlling interests owned: Non-Controlling Interest % Non-controlling interest % as of December 31, 2021 72.20 % Issuance of Class A Common Stock upon the conversion of RSILP Unit Exchanges (1.46) % Issuance of Class A Common Stock as purchase consideration (0.02) % Issuance of Class V Common Stock as purchase consideration 0.06 % Issuance of Class A Common Stock in connection with the vesting of certain share-based equity grants (0.23) % Non-controlling interest % as of December 31, 2022 70.55 % Treasury Stock During the year ended December 31, 2021, the Company repurchased 218,589 shares of its Class A Common Stock at an average price of $15.85 and a total cost of $3.5 million. The repurchased shares were subsequently reissued in connection with share-based compensation plans during the year ended December 31, 2021. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Compensation | Share-Based Compensation Incentive Plan The Company created the Rush Street Interactive, Inc. 2020 Omnibus Equity Incentive Plan, as amended from time to time (the “2020 Plan”), to attract, retain and incentivize employees, consultants and independent directors that will contribute to the success of the Company. Awards that may be granted under the 2020 Plan include incentive stock options, non-qualified stock options, stock appreciation rights, restricted awards, performance share awards, cash awards and other equity-based awards. During the year ended December 31, 2023, the Compensation Committee of the Board and the full Board each approved an amendment to the 2020 Plan to increase the number of shares of Class A Common Stock reserved under the 2020 Plan by 22.4 million shares, with the Company’s stockholders approving such amendment at the Company’s 2023 annual meeting of stockholders on June 1, 2023. There are approximately 35.8 million shares of Class A Common Stock reserved under the 2020 Plan. The 2020 Plan terminates on December 29, 2030. Restricted Stock Units (“RSUs”) and Options The Company granted 2.5 million and 3.9 million RSUs with service conditions, during the years ended December 31, 2023 and 2022, respectively. RSUs with service conditions generally vest over a three The Company granted 1.5 million and 1.6 million RSUs with market-based conditions (e.g., share price targets, total shareholder return) during the years ended December 31, 2023 and 2022, respectively. RSUs with market-based conditions generally vest over a three year period and the fair value was determined using a Monte Carlo simulation using the following range of assumptions: December 31, December 31, Volatility rate 69.78 % 70.93% to 71.00% Risk-free interest rate 3.85 % 4.32% to 4.39% Average expected life (in years) 2.8 2.3 to 3.0 Dividend yield None None Stock price at grant date $ 3.28 $ 3.95 The Company granted 1.1 million and 0.8 million stock options during the years ended December 31, 2023 and 2022, respectively. The estimated grant date fair value of stock options was determined using a Black-Scholes valuation model using the following weighted-average assumptions: December 31, December 31, Volatility rate 70.00 % 58.98 % Risk-free interest rate 3.80 % 3.68 % Average expected life (in years) 6.0 5.6 Dividend yield None None Stock price at grant date $ 3.28 $ 4.07 Exercise price $ 3.28 $ 4.07 RSU activity for the years ended December 31, 2023 and 2022 was as follows: Number of Weighted average grant price Unvested balance at December 31, 2021 3,076,158 $ 16.08 Granted 5,542,010 4.17 Vested (1) (1,020,874) 14.67 Forfeited (104,681) 14.36 Unvested balance at December 31, 2022 7,492,613 $ 7.48 Granted 4,030,535 4.12 Vested (1) (2,221,870) 8.71 Forfeited (83,136) 9.52 Unvested balance at December 31, 2023 9,218,142 $ 5.70 _____________________________ (1) Include 467,712 and 253,787 of RSUs that vested during the years ended December 31, 2023 and 2022, respectively, for which the resulting shares of Class A Common Stock have not yet been issued. There were 1,104,629 and 636,917 RSUs that vested for which the resulting shares of Class A Common Stock were not issued as of December 31, 2023 and 2022, respectively. Stock option activity for the years ended December 31, 2023 and 2022 was as follows: Number of Units Weighted average exercise price Outstanding balance at December 31, 2021 96,827 $ 15.40 Granted 790,339 4.07 Exercised — — Forfeited — — Outstanding balance at December 31, 2022 887,166 5.31 Granted 1,084,445 3.28 Exercised — — Forfeited — — Outstanding balance at December 31, 2023 1,971,611 $ 4.19 Exercisable balance at December 31, 2023 328,002 $ 6.30 The aggregate fair value of the RSUs granted during the years ended December 31, 2023 and 2022, was approximately $16.6 million and $23.1 million, respectively. The weighted average grant date fair value of the RSUs vested during the years ended December 31, 2023 and 2022, was approximately $19.3 million and $15.0 million, respectively. The weighted-average grant-date fair values of options granted during the years ended December 31, 2023 and 2022 were $2.14 and $2.26 per share, respectively. The aggregate fair value of the stock options granted during the years ended December 31, 2023 and 2022, was $2.3 million and $1.8 million, respectively. The outstanding stock options and exercisable stock options as of December 31, 2023 had an intrinsic value of $1.6 million and $0.1 million, respectively. As of December 31, 2023, the Company had unrecognized stock-based compensation expense related to RSUs of $37.8 million, which is expected to be recognized over the remaining weighted-average vesting period of 0.9 years. As of December 31, 2023, the Company had unrecognized stock-based compensation expense related to stock options of $2.8 million, which is expected to be recognized over the remaining weighted-average vesting period of 1.0 year. Recognition of Compensation Costs Share-based compensation expense for the years ended December 31, 2023, 2022 and 2021 was as follows: Years Ended ($ in thousands) 2023 2022 2021 Costs of revenue $ 1,064 $ 987 $ 1,808 Advertising and promotions 2,225 2,048 3,605 General and administrative 26,731 15,656 19,499 Total share-based compensation expense $ 30,020 $ 18,691 $ 24,912 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes RSILP is treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As a partnership, RSILP is not subject to U.S. federal and certain state and local income taxes. Any taxable income or loss generated by RSILP is passed through to and included in the taxable income or loss of its partners, including the Company, on a pro rata basis. The Company is subject to U.S. federal income taxes and state and local income taxes with respect to our allocable share of any taxable income or loss of RSILP, as well as any stand-alone income or loss generated by the Company. Income Tax Expense The components of the income tax expense are: Years Ended ($ in thousands) 2023 2022 2021 Current income taxes: Federal $ (188) $ (118) $ 149 State and local 9 (34) 25 Foreign 11,602 9,137 4,551 11,423 8,985 4,725 Deferred income taxes: Federal — — — State and local — — — Foreign (214) (24) (37) (214) (24) (37) Income tax expense $ 11,209 $ 8,961 $ 4,688 Reconciliations of income tax expense computed at the U.S. federal statutory income tax rate to the recognized income tax expense and the U.S. statutory income tax rate to our effective tax rates are as follows: Years Ended ($ in thousands) 2023 2022 2021 Net loss before income taxes $ (48,846) $ (125,371) $ (66,404) Less: net loss before income taxes attributable to non-controlling interest (33,820) (89,224) (48,258) Net loss attributable to Rush Street Interactive Inc. before income taxes (15,026) (36,147) (18,146) Income tax benefit at the federal statutory rate (3,155) (7,591) (3,811) State income taxes, net of federal benefit (46) (34) 25 Nondeductible stock compensation 1,351 — — Foreign operations 11,387 9,113 4,514 Change in valuation allowance 2,589 8,025 4,027 Other (917) (552) (67) Income tax expense $ 11,209 $ 8,961 $ 4,688 Deferred Tax Assets and Liabilities The Company’s deferred tax position reflects the net tax effects of the temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax reporting. The net deferred tax assets are recognized in other assets on the Company’s consolidated balance sheets. Significant components of the deferred tax assets and liabilities are as follows: Years Ended ($ in thousands) 2023 2022 Deferred tax assets: Investment in subsidiaries $ 134,283 $ 134,586 Net operating losses 29,724 26,394 Imputed interest 2,120 1,638 Share-based compensation 1,160 366 Other assets 422 165 Total gross deferred tax assets 167,709 163,149 Valuation allowance (167,305) (163,029) Total deferred tax assets, net of valuation allowance 404 120 Deferred tax liabilities: Investment in subsidiaries — — Total gross deferred tax liabilities — — Net deferred tax assets $ 404 $ 120 As of December 31, 2023, the Company had approximately $94.5 million and $83.4 million of federal and state net operating loss carryovers, respectively. As of December 31, 2022, the Company had approximately $73.3 million and $69.4 million of federal and state net operating loss carryovers, respectively. If not utilized, the entire federal net operating loss carryforward can be carried forward indefinitely. State net operating loss carryovers will expire in varying amounts beginning in 2032. As of December 31, 2023 and 2022, the Company has foreign net operating losses of approximately $15.2 million and $30.9 million, respectively, the majority of which will begin to expire beginning in 2043 if not utilized. The Company regularly reviews its 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, the Company makes estimates and assumptions regarding projected future taxable income, its 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, the Company has determined it is not more-likely-than-not to realize existing deferred tax assets and thus has recorded a valuation allowance. As the Company reassesses these assumptions in the future, changes in forecasted taxable income may alter this expectation and may result in changes to the valuation allowance and the effective tax rate. In August 2022, the U.S. Inflation Reduction Act of 2022 and the CHIPS and Science Act of 2022 were signed into law. These acts include, among other provisions, a corporate alternative minimum tax of 15%, an excise tax on the repurchase of corporate stock, various climate and energy provisions, and incentives for investment in semiconductor manufacturing. These provisions are not expected to have a material impact on the Company’s results of operations or financial position. In 2021, the OECD established an Inclusive Framework on Base Erosion and Profit Shifting and agreed on a two-pillar solution (“Pillar Two”) to global taxation, focusing on global profit allocation and a 15% global minimum effective tax rate. On December 15, 2022, the European Union member states agreed to implement the OECD’s global minimum tax rate of 15%. The OECD issued Pillar Two model rules and continues to release guidance on these rules. The Inclusive Framework calls for tax law changes by participating countries to take effect in 2024 and 2025. Various countries have enacted or have announced plans to enact new tax laws to implement the global minimum tax. The Company considered the applicable tax law changes on Pillar Two implementation in the relevant countries, and there is no impact to our tax provision for the year ended December 31, 2023. The Company will continue to evaluate the impact of these tax law changes on future reporting periods. Uncertain Tax Positions The Company evaluates its tax positions and recognizes tax benefits that, more-likely-than-not, will be sustained upon examination based on the technical merits of the position. The Company did not have any unrecognized tax benefits as of December 31, 2023 or December 31, 2022. The Company filed an initial year federal and state tax returns for tax year 2020, which was the first tax year subject to examination by taxing authorities. Additionally, although RSILP is treated as a partnership for U.S. federal and state income taxes purposes, it is still required to file an annual U.S. Return of Partnership Income, which is subject to examination by the Internal Revenue Service. The statute of limitations has expired for tax years through 2019 for RSILP. Tax Receivable Agreement Pursuant to RSILP’s election under Section 754 of the Internal Revenue Code (the “Code”), the Company expects to obtain an increase in our share of the tax basis in the net assets of RSILP when RSILP Units are redeemed or exchanged by the unit holders and other qualifying transactions. The Company plans to make an election under Code Section 754 for each taxable year in which a redemption or exchange of RSILP Units occur. The Company intends to treat any redemptions and exchanges of RSILP Units by the unit holders as direct purchases of RSILP Units for U.S. federal income tax purposes. These increases in tax basis may reduce the amounts that the Company would otherwise pay in the future to various tax authorities. These increases in tax basis may also decrease gains (or increase losses) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets. In connection with the Business Combination, the Special Limited Partner entered into the TRA, which generally provides for the payment by it of 85% of certain net tax benefits, if any, that the Company (including the Special Limited Partner) realize (or in certain cases is deemed to realize) as a result of these increases in tax basis and tax benefits related to the Business Combination and the exchange of Retained RSILP Units for Class A Common Stock (or cash at the Company’s option) pursuant to the RSILP A&R LPA and tax benefits related to entering into the TRA, including tax benefits attributable to payments under the TRA. These payments are the obligation of the Special Limited Partner and not of RSILP. The actual increase in the Special Limited Partner’s allocable share of RSILP’s tax basis in its assets, as well as the amount and timing of any payments under the TRA, will vary depending upon a number of factors, including the timing of exchanges, the market price of Class A Common Stock at the time of the exchange and the amount and timing of the recognition of the Company’s and its consolidated subsidiaries’ (including the Special Limited Partner’s) income. While many of the factors that will determine the amount of payments that the Special Limited Partner will make under the TRA are outside of the Company’s control, the Company expects that the payments the Special Limited Partner will make under the TRA will be substantial and could have a material adverse effect on the Company’s financial condition. |
Loss Per Share
Loss Per Share | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Loss Per Share | Loss Per Share Basic net loss per share of Class A Common Stock is computed by dividing net loss attributable to RSI by the weighted-average number of shares of Class A Common Stock outstanding during the period. Diluted net loss per share of Class A Common Stock is computed by dividing net loss attributable to RSI, adjusted for the assumed exchange of all potentially dilutive securities, by the weighted-average number of shares of Class A Common Stock outstanding adjusted to give effect to potentially dilutive shares. The computation of net loss per share attributable to RSI and weighted-average shares of the Company’s Class A Common Stock outstanding for the years ended December 31, 2023, 2022 and 2021 are as follows (amounts in thousands, except for share and per share amounts): Years Ended 2023 2022 2021 Numerator: Net loss $ (60,055) $ (134,332) $ (71,092) Less: Net loss attributable to non-controlling interests (41,750) (95,701) (51,603) Net loss attributable to Rush Street Interactive, Inc. – basic (18,305) (38,631) (19,489) Effect of dilutive securities: Public, Private Placement and Working Capital Warrants, net of amounts attributable to non-controlling interests — — (9,569) Net loss attributable to Rush Street Interactive, Inc. – diluted $ (18,305) $ (38,631) $ (29,058) Denominator Weighted average common shares outstanding – basic 68,508,093 63,532,906 56,265,541 Weighted average effect of dilutive securities: Public Warrants (1) — — 677,746 Private Placement and Working Capital Warrants (1) — — 483,598 Weighted average common shares outstanding – diluted 68,508,093 63,532,906 57,426,885 Net loss per Class A Common Share - basic $ (0.27) $ (0.61) $ (0.35) Net loss per Class A Common Share - diluted $ (0.27) $ (0.61) $ (0.51) (1) Calculated using the treasury stock method. Shares of the Class V Common Stock do not participate in the earnings or losses of the Company and are therefore not participating securities. As such, separate presentation of basic and diluted earnings per share of Class V common stock under the two-class method has not been presented. The Company excluded the following securities from its computation of diluted shares outstanding, as their effect would have been anti-dilutive: December 31, 2023 2022 2021 RSILP Units (1) 150,434,310 155,955,584 158,702,329 Unvested RSUs 9,218,142 7,492,613 3,076,158 Vested RSUs (2) 1,104,629 636,917 383,130 Outstanding Stock Options 1,971,611 887,166 96,827 (1) RSILP Units that are held by non-controlling interest holders and may be exchanged, subject to certain restrictions, for Class A Common Stock. Upon exchange of an RSILP Unit, a share of Class V Common Stock is cancelled. (2) RSUs that vested but the resulting shares of Class A Common Stock have not yet been issued. |
Related Parties
Related Parties | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Parties | Related Parties Prior to the Business Combination, RSILP’s principal unit holders included Neil G. Bluhm, Executive Chairman, and NGB 2013 Grandchildren’s Dynasty Trust (collectively, “Bluhm and Trust”) and Gregory A. Carlin, the Company’s former Chief Executive Officer and former vice chairman, and Greg and Marcy Carlin Family Trust (collectively, “Carlin and Trust”). Bluhm and Trust and Carlin and Trust had interests in RSILP of approximately 73% and 20%, respectively. Both Bluhm and Trust and Carlin and Trust are the owners of the Sellers’ Representative, which had an interest of approximately 1% in RSILP. Neil Bluhm and Richard Schwartz, the Company’s Chief Executive Officer, maintain ownership in RSILP and collectively have control over its governance and general operations. At the Closing, the Company and RSI GP entered into the Amended and Restated Limited Liability Company Agreement of RSI GP, pursuant to which, among other things, the parties established a board of managers of RSI GP, which is initially comprised of Neil Bluhm, Gregory Carlin and Richard Schwartz, to direct and exercise control over all activities of RSI GP, including RSI GP’s right to manage and control RSILP. As of December 31, 2023, Neil Bluhm and Richard Schwartz remain on the board of managers of RSI GP. Amended and Restated Agreement of Limited Partnership of RSILP At the Closing, the Company, the Special Limited Partner, RSI GP, RSILP and the Sellers entered into the RSILP A&R LPA. Management RSI GP, as the general partner of RSILP following the Closing, has the sole authority to manage the business, property and affairs of RSILP in accordance with the RSILP A&R LPA or applicable law, including laws relating to gaming. The RSILP A&R LPA provides that the general partner cannot be removed or replaced except with the consent of a majority in interests of the partners of RSILP and the Company. The rights of the general partner’s board of managers are governed by the general partner’s limited liability company agreement, which may be amended or modified from time to time by the Company. Tax Distributions The RSILP A&R LPA provides quarterly tax distributions payable in accordance with the RSILP A&R LPA to the holders of RSILP Units on a pro rata basis based upon an agreed-upon formula related to the taxable income of RSILP allocable to holders of RSILP Units. Generally, these tax distributions will be computed based on RSILP’s estimate of the taxable income of RSILP allocable to each holder of RSILP Units (based on certain assumptions) multiplied by an assumed tax rate equal to the highest effective marginal combined U.S. federal, state and local income tax rate prescribed for an individual or corporation resident in New York, California or Illinois (whichever results in the application of the highest state and local tax rate), subject to various adjustments. Distributions, including tax distributions, will be made to holders of RSILP Units on a pro rata basis. Transfer Restrictions The RSILP A&R LPA contains restrictions on transfers of units and requires the prior consent of the general partner for such transfers, except, in each case, for certain transfers to permitted transferees under certain conditions and exchanges of RSILP Units for shares of Class A Common Stock after the six-month anniversary of the Closing. Exchange of RSILP Units for Class A Common Stock The Sellers are, up to four times per calendar year, able to exchange all or any portion of their RSILP Units, together with the cancellation of an equal number of shares of Class V Common Stock, for a number of shares of Class A Common Stock equal to the number of exchanged RSILP Units by delivering a written notice to RSILP, with a copy to the Special Limited Partner; provided that no holder of RSILP Units may exchange less than 1,000 RSILP Units in any single exchange unless exchanging all of the RSILP Units held by such holder at such time, subject in each case to the limitations and requirements set forth in the RSILP A&R LPA regarding such exchanges. Notwithstanding the foregoing, the Special Limited Partner may, at its sole discretion, in lieu of delivering shares of Class A Common Stock for any RSILP Units surrendered for exchange, pay an amount in cash per RSILP Unit equal to the 5-day VWAP of the Class A Common Stock on the date of the receipt of the written notice of the exchange. Exchange Ratio For each RSILP Unit exchanged, one share of Class V Common Stock will be canceled, and one share of Class A Common Stock will be issued to the exchanging member. If the Class A Common Stock is converted or changed into another security, securities or other property, on any subsequent exchange an exchanging RSI Unit holder will be entitled to receive such security, securities or other property. Restrictions on Exchange In certain circumstances, RSI GP may limit the rights of holders of RSILP Units to exchange their RSILP Units under the RSILP A&R LPA if RSI GP determines in good faith that such restrictions are necessary so that RSILP will not be classified as a “publicly traded partnership” under applicable tax laws and regulations. Services Agreement At the Closing, Rush Street Gaming, LLC (“RSG”), an affiliate of the Company controlled by Neil Bluhm, Executive Chairman, entered into a Services Agreement (the “Services Agreement”), pursuant to which, among other things, RSG and its affiliates provide certain specified services to the Company for a period of two years following the Closing, subject to extension and early termination, including, without limitation, services relating to certain corporate and shared services related to functions such as government affairs, certain business development, insurance and other services (in each case as more fully described in the Services Agreement). RSG and its affiliates had provided similar services to RSILP prior to the Business Combination and the Services Agreement represents a continuation of those services and support. As compensation for RSG’s provision of these services, the Company reimburses RSG for (i) all third party costs, including fees and costs incurred in connection with any required consents, incurred in connection with the provision of services, (ii) its reasonable and documented out-of-pocket travel and related expenses as approved by the Company, and (iii) an allocable portion of payroll, benefits and overhead with respect to RSG’s or its affiliates’ employees who perform or otherwise assist in providing the services. Expenses and payables relating to support services provided by RSG were immaterial for the years ended and as of December 31, 2023 and 2022, respectively. Expenses relating to support services were $1.1 million for the year ended December 31, 2021. These support services are recorded as general and administrative in the accompanying consolidated statements of operations and any payables to RSG are recorded as accrued expenses within the accompanying consolidated balance sheets. Affiliated Land-Based Casinos Neil Bluhm and his adult children (including Ms. Leslie Bluhm, a member of the Company’s Board of Directors (the “Board”)), through their individual capacities, entities or trusts that they have created for the benefit of themselves or their family members, and Greg Carlin, through his individual capacity, entities or trusts that he has created for the benefit of himself or his family members, are direct or indirect owners, directors and/or officers of certain land-based casinos. The Company has entered into certain agreements with these affiliated land-based casinos that create strategic partnerships aimed to capture the online gaming, online sports betting and retail sports services markets in the various states and municipalities where the land-based casinos operate. Generally, the Company pays a royalty fee to the land-based casino (calculated as a percentage of the Company’s revenue less reimbursable costs as defined in the agreement) in exchange for the right to operate real-money online casino and/or online sports betting under the gaming license of the land-based casinos. Royalties related to arrangements with affiliated casinos were $49.6 million, $39.8 million and $41.6 million for the years ended December 31, 2023, 2022 and 2021, respectively, which were net of any consideration received from the affiliated casino for reimbursable costs, as well as costs that are paid directly by the affiliate casino on the Company’s behalf. Net royalties paid are recorded as costs of revenue in the accompanying consolidated statements of operations. In certain cases, the affiliate casino maintains the bank account that processes cash deposits and withdrawals for RSI customers. Accordingly, at any point in time, the Company will record a receivable from the affiliate, representing RSI total gaming revenue (with RSI customers) that was collected by the affiliate, less consideration payable to the affiliate for use of its license, which is offset by any consideration received from the affiliate based on the terms of the agreement. Receivables due from affiliated land-based casinos were $33.5 million and $35.9 million at December 31, 2023 and 2022, respectively. In addition, the Company provides retail sports services to certain affiliated land-based casinos in exchange for a monthly commission based on the land-based casino’s retail sportsbook revenue. Services include ongoing management and oversight of the retail sportsbook, technical support for the land-based casino’s customers, customer support, risk management, advertising and promotion, and support for the third-party vendor’s sports betting equipment. Revenue recognized relating to retail sports services provided to affiliated land-based casinos during the years ended December 31, 2023, 2022 and 2021 were not material to the consolidated financial statements. Any payables due to the affiliated land-based casinos are netted against Affiliate Receivables to the extent a right of offset exists, yet such amounts were not material to the consolidated financial statements as of December 31, 2023 and 2022. Purchase of RSP During the year ended December 31, 2022, the Company purchased all of the equity interests of RSP, a poker-related production company that owns certain poker-related assets, including Poker Night in America, a television program focused on poker games and tournaments. On June 10, 2022, Messrs. Neil Bluhm and Greg Carlin forfeited their limited liability company interests in RSP, resulting in Mr. Todd Anderson being the sole owner of RSP. The Company then purchased from Mr. Anderson 100% of the limited liability company interests in RSP for an aggregate purchase price of approximately $4.7 million, comprised of cash, Class V Common Stock, RSILP Units, Class A Common Stock and assumed liabilities (the “RSP Acquisition”). The Company obtained an independent valuation report as to the fair market value of RSP to support the purchase price being paid for the RSP Acquisition. As part of the RSP Acquisition, the Company employed Mr. Anderson and two other RSP employees. Mr. Anderson received all of the proceeds from the RSP Acquisition; Messrs. Bluhm and Carlin did not receive any proceeds from the RSP Acquisition. The Audit Committee of the Board approved the RSP Acquisition in accordance with the Company’s Related-Party Transactions Policy, and the Board (with Mr. Bluhm and certain other directors abstaining) approved the same. See Note 2 and Note 15 for additional information. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Leases | Leases The Company leases office space and other retail space under operating lease agreements with terms that do not exceed five years. In addition, the Company leases online gaming servers and related equipment under finance lease arrangements. The components of lease expense for the years ended December 31, 2023, 2022 and 2021 were as follows: Years Ended ($ in thousands) 2023 2022 2021 Operating lease cost $ 770 $ 676 $ 268 Variable lease cost 267 275 528 Short-term lease cost 867 436 179 Finance lease cost: Amortization of finance lease right-of-use asset 1,272 578 228 Interest on finance lease liabilities 85 22 27 Total lease expenses $ 3,261 $ 1,987 $ 1,230 Additional information relating to leases for the years ended December 31, 2023, 2022 and 2021 was as follows: Years Ended ($ in thousands) 2023 2022 2021 Operating cash flows from operating leases $ 732 $ 653 $ 355 Right-of-use assets obtained in exchange for new or modified operating lease liabilities $ 210 $ 965 $ 810 Right-of-use assets obtained in exchange for new or modified finance lease liabilities $ 2,423 $ 1,124 $ 2,547 Weighted-average remaining lease term (in years) – operating leases 2.5 3.1 3.2 Weighted-average remaining lease term (in years) – finance leases 3.4 3.0 4.6 Weighted-average discount rate – operating leases 6.7 % 6.2 % 6.0 % Weighted-average discount rate – finance leases 7.7 % 6.0 % 6.0 % The Company calculated the weighted-average discount rate using the interest rates implicit in the lease contract and if not determinable, incremental borrowing rates, which equal the rates of interest that it would pay to borrow funds on a fully collateralized basis over a similar term. The Company records lease activity within the following financial statement line items: Account Financial Statement Line Item Operating lease right-of-use asset Operating lease assets Finance lease right-of-use asset, net Property and equipment, net Operating lease liabilities Current and non-current operating lease liabilities Finance lease liabilities Other current liabilities and Other non-current liabilities Operating lease expense General and administrative Finance lease amortization expense Depreciation and amortization Finance lease interest expense Interest income (expense), net Maturity of operating lease liabilities as of December 31, 2023 is as follows: ($ in thousands) Year ending December 31, 2024 $ 686 Year ending December 31, 2025 392 Year ending December 31, 2026 214 Year ending December 31, 2027 125 Year ending December 31, 2028 — Total undiscounted future cash flows 1,417 Less: present value discount (123) Operating lease liabilities $ 1,294 Maturity of finance lease liabilities as of December 31, 2023 is as follows: ($ in thousands) Year ending December 31, 2024 $ 873 Year ending December 31, 2025 873 Year ending December 31, 2026 318 Year ending December 31, 2027 230 Year ending December 31, 2028 214 Total undiscounted future cash flows 2,508 Less: present value discount (291) Finance lease liabilities $ 2,217 |
Leases | Leases The Company leases office space and other retail space under operating lease agreements with terms that do not exceed five years. In addition, the Company leases online gaming servers and related equipment under finance lease arrangements. The components of lease expense for the years ended December 31, 2023, 2022 and 2021 were as follows: Years Ended ($ in thousands) 2023 2022 2021 Operating lease cost $ 770 $ 676 $ 268 Variable lease cost 267 275 528 Short-term lease cost 867 436 179 Finance lease cost: Amortization of finance lease right-of-use asset 1,272 578 228 Interest on finance lease liabilities 85 22 27 Total lease expenses $ 3,261 $ 1,987 $ 1,230 Additional information relating to leases for the years ended December 31, 2023, 2022 and 2021 was as follows: Years Ended ($ in thousands) 2023 2022 2021 Operating cash flows from operating leases $ 732 $ 653 $ 355 Right-of-use assets obtained in exchange for new or modified operating lease liabilities $ 210 $ 965 $ 810 Right-of-use assets obtained in exchange for new or modified finance lease liabilities $ 2,423 $ 1,124 $ 2,547 Weighted-average remaining lease term (in years) – operating leases 2.5 3.1 3.2 Weighted-average remaining lease term (in years) – finance leases 3.4 3.0 4.6 Weighted-average discount rate – operating leases 6.7 % 6.2 % 6.0 % Weighted-average discount rate – finance leases 7.7 % 6.0 % 6.0 % The Company calculated the weighted-average discount rate using the interest rates implicit in the lease contract and if not determinable, incremental borrowing rates, which equal the rates of interest that it would pay to borrow funds on a fully collateralized basis over a similar term. The Company records lease activity within the following financial statement line items: Account Financial Statement Line Item Operating lease right-of-use asset Operating lease assets Finance lease right-of-use asset, net Property and equipment, net Operating lease liabilities Current and non-current operating lease liabilities Finance lease liabilities Other current liabilities and Other non-current liabilities Operating lease expense General and administrative Finance lease amortization expense Depreciation and amortization Finance lease interest expense Interest income (expense), net Maturity of operating lease liabilities as of December 31, 2023 is as follows: ($ in thousands) Year ending December 31, 2024 $ 686 Year ending December 31, 2025 392 Year ending December 31, 2026 214 Year ending December 31, 2027 125 Year ending December 31, 2028 — Total undiscounted future cash flows 1,417 Less: present value discount (123) Operating lease liabilities $ 1,294 Maturity of finance lease liabilities as of December 31, 2023 is as follows: ($ in thousands) Year ending December 31, 2024 $ 873 Year ending December 31, 2025 873 Year ending December 31, 2026 318 Year ending December 31, 2027 230 Year ending December 31, 2028 214 Total undiscounted future cash flows 2,508 Less: present value discount (291) Finance lease liabilities $ 2,217 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Matters The Company is not a party to any material legal proceedings and is not aware of any material pending or threatened claims. From time to time however, the Company may be subject to various legal proceedings and claims that arise in the ordinary course of its business activities. Other Contractual Obligations The Company is a party to several non-cancelable contracts with vendors and licensors for marketing and other strategic partnership related agreements. Under the non-cancelable terms of these contracts, the Company is obligated to make future minimum payments as follows: ($ in thousands) Year ending December 31, 2024 $ 13,653 Year ending December 31, 2025 7,880 Year ending December 31, 2026 5,565 Year ending December 31, 2027 5,165 Year ending December 31, 2028 4,728 Thereafter 26,975 Total (1) $ 63,966 (1) Includes operating lease and finance lease obligations under non-cancelable lease contracts totaling $6.0 million, obligations under non-cancelable contracts with marketing vendors totaling $11.1 million, and license and market access commitments totaling $46.9 million. Certain market access arrangements require the Company to make additional payments at a contractual milestone date if the market access fees paid up until that milestone date do not meet a minimum contractual threshold. In these instances, the Company calculates future minimum payment as the total milestone payment less any amounts already paid to the partner and includes such payments in the period in which the milestone date occurs. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pay vs Performance Disclosure | |||
Net Income (Loss) | $ (18,305) | $ (38,631) | $ (19,489) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 31, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | true |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). The consolidated financial statements include the accounts of the Company, its direct and indirect wholly owned subsidiaries, and all entities in which the Company has a controlling interest. RSI is deemed to have a controlling interest of RSILP through its wholly owned subsidiary RSI GP, LLC (“RSI GP”), which is the sole general partner of RSILP. For consolidated entities that are less than wholly owned, third party holdings of equity interests are presented as Non-controlling interests in the Company’s consolidated balance sheets and consolidated statements of changes in stockholders’ equity. The portion of net loss attributable to the non-controlling interests is presented as net loss attributable to non-controlling interests in the Company’s consolidated statements of operations, while the portion of comprehensive loss attributable to the non-controlling interests is reported as comprehensive loss attributable to non-controlling interests in the Company’s consolidated statements of comprehensive loss. All intercompany accounts and transactions have been eliminated upon consolidation. The Company is organized as an umbrella partnership-C corporation, or Up-C, structure, as a result of the transactions contemplated in the Business Combination Agreement, dated as of July 27, 2020 (as amended and/or restated from time to time, the “Business Combination Agreement” and the transactions contemplated thereby, the “Business Combination”). The Business Combination Agreement was entered among RSILP, the sellers set forth on the signature pages thereto (collectively, the “Sellers” and each, a “Seller”), dMY Sponsor, LLC (the “Sponsor”) and Rush Street Interactive GP, LLC, resulting in dMY Technology Group, Inc. (“dMY”) acquiring certain Class A Units of RSILP (the “RSILP Units”). The Business Combination was accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, dMY is treated as the acquired company and RSILP is treated as the acquirer for financial statement reporting purposes. Accordingly, for accounting purposes, the Business Combination was treated as the equivalent of RSILP issuing stock for the net assets of dMY, accompanied by a recapitalization. RSILP was determined to be the accounting acquirer based on evaluation of the following facts and circumstances: • RSILP’s existing members, through their ownership of RSI’s Class V Common Stock, have the largest portion of the voting rights in the Company; • The Board of Directors of the Company (the “Board”) and management are primarily composed of individuals associated with RSILP; and • RSILP is the larger entity based on historical operating activity and has the larger employee base. As an Up-C, substantially all of the assets of the combined company are held by RSILP and the Company’s primary assets are its equity interests in RSILP (which are held indirectly through wholly owned subsidiaries of the Company – RSI ASLP, Inc. (the “Special Limited Partner”) and RSI GP). The Company controls RSILP through RSI GP. As of December 31, 2023, the Company owned 32.49% of the RSILP Units and the holders of the non-controlling interest 67.51% of the RSILP Units. Neil G. Bluhm and his trusts and entities controlled by him and Richard Schwartz (collectively, the “Controlling Holders”) together as a group control a majority of the voting power of the Company’s outstanding common stock. As a result, RSI is a “controlled company” under the New York Stock Exchange’s corporate governance standards. |
Reclassifications | Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. Such reclassifications had no impact on the Company’s reported total revenues, expenses, net loss, current assets, total assets, current liabilities, total liabilities, stockholders’ equity, non-controlling interests or cash flows. No reclassifications of prior period balances were material to the consolidated financial statements. |
Liquidity and Capital Resources | Liquidity and Capital Resources The Company currently expects that its cash will be sufficient to fund its operating expenses and capital expenditure requirements for at least 12 months from the date of issuance of this report based on future spend assumptions. The Company experienced negative operating cash flows of $5.9 million, $60.3 million and $48.2 million for the years ended December 31, 2023, 2022 and 2021, respectively. The Company had working capital totaling $90.9 million as of December 31, 2023. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Significant estimates and assumptions reflected in the consolidated financial statements relate to and include, but are not limited to, the valuation of share-based awards, the earnout interests liability, the warrant liabilities and acquired intangibles; internally developed software; long-lived assets and investments in equity; the estimated useful lives of property and equipment and intangible assets; redemption rate assumptions associated with the loyalty program and other discretionary player bonuses; accrued expenses; determination of the incremental borrowing rate to calculate operating lease liabilities and finance lease liabilities; and deferred taxes and amounts associated with the tax receivable agreement (the “Tax Receivable Agreement” or “TRA”) entered into in connection with the closing on December 29, 2020 of the Business Combination (the “Closing”). |
Segment Reporting | Segment Reporting Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the Chief Operating Decision Maker (“CODM”) in making decisions regarding resource allocation and assessing performance. The Company views its operations and manages its business in one operating segment. |
Cash and Cash Equivalents and Restricted Cash | Cash and Cash Equivalents and Restricted Cash Cash and cash equivalents consist of highly liquid, unrestricted savings, checking, instant access internet banking accounts, money market funds and certificates of deposits with original maturities of 90 days or less at acquisition. Restricted cash includes any cash and cash equivalents held by the Company that are legally restricted as to withdrawals or usage. This consists of certain deposits that are restricted under regulatory requirements. Regardless of whether customer deposits are legally restricted, the Company maintains separate bank accounts to segregate cash that resides in customers’ accounts from operational funds. The following table reconciles cash and cash equivalents and restricted cash in the consolidated balance sheets to the totals shown on the consolidated statements of cash flows: December 31, ($ in thousands) 2023 2022 Cash and cash equivalents (1) $ 168,330 $ 179,723 Restricted cash 2,647 26,358 Total cash, cash equivalents and restricted cash $ 170,977 $ 206,081 (1) The Company had cash equivalents of $78.4 million and $1.0 million as of December 31, 2023 and 2022, respectively. Cash equivalents are composed of money market funds and certificates of deposits with original maturities of 90 days or less. Money market funds of $68.7 million are valued using quoted market prices as of December 31, 2023. The Company did not have money market funds as of December 31, 2022. |
Players Receivables | Players Receivables Players receivables consist of cash deposits from customers that the Company has not yet received. Players receivables are reported at the amount that the Company expects to collect from customers, generally via third-party payment processors. These receivables arise due to the timing difference between a customer’s deposit and the Company’s receipt of that deposit from the payment processor. The amounts are generally outstanding for a short period of time. On a periodic basis, the Company evaluates its players receivables and establishes an allowance for doubtful accounts based on a specific review of the accounts as well as historical collection experience and current economic conditions. No allowance for doubtful accounts was recorded for the periods presented in these consolidated financial statements. |
Due from Affiliates | Due from Affiliates Due from affiliates consists of amounts that are expected to be collected from certain affiliated land-based casino partners. In certain cases, the affiliate casino maintains the bank account that processes cash deposits and withdrawals for RSI customers. Accordingly, at any point in time, the Company will record a receivable from the affiliate, representing the Company’s total revenue (with RSI customers) that was collected by the affiliate, less consideration payable to the affiliate for use of its license, which is offset by any consideration received from the affiliate based on the terms of the applicable agreement. On a periodic basis, the Company evaluates the collectability of amounts due from affiliates and establishes an allowance for amounts not expected to be collected. No allowance was recorded for the periods presented in these consolidated financial statements. See Note 13 for disclosure on related parties. |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets |
Property and Equipment, net | Property and Equipment, net Property and equipment are carried at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful life of the asset. Leasehold improvements depreciation is computed over the shorter of the remaining lease term or estimated useful life of the asset. Additions and improvements are capitalized, while repairs and maintenance are expensed as incurred. Useful lives of each asset class are as follows: Asset Useful Life Computers, software and related equipment 3 years Furniture and fixtures 4 years Operating equipment and servers 5 years Leasehold improvements Lesser of the lease terms or the estimated useful lives of the improvements, generally 1–10 years |
Intangible Assets, Net | Intangible Assets, Net License Fees, Net The Company incurs costs in connection with operating in certain jurisdictions, including license applications fees, market access payments to strategic partners and related renewals or extensions. These costs are capitalized as an intangible asset and amortized over the estimated useful life of the asset using the straight-line method. In certain markets, the Company agrees to pay minimum market access royalties to its partner, which is considered an integral cost in connection with operating in certain jurisdictions. The Company records fixed minimum royalty payments as intangible assets with an offset to deferred royalty liabilities, both of which are included on the consolidated balance sheets. The Company’s access to operate in a particular market is often dependent upon the continued viability of its strategic partner in that market. The useful life is the period over which the asset is expected to contribute directly or indirectly to the Company’s cash flows. The remaining useful life of license fee intangible assets is evaluated at least annually. Internally Developed Software Software that is developed for internal use is accounted for pursuant to Accounting Standards Codification (“ASC”) 350-40, Intangibles, Goodwill and Other - Internal-Use Software . Qualifying costs incurred to develop internal-use software are capitalized when (i) the preliminary project stage is completed, (ii) management has authorized further funding for the completion of the project and (iii) it is probable that the project will be completed and perform as intended. These capitalized costs include compensation for employees who develop internal-use software and external costs related to development and implementation of internal-use software. Capitalization of these costs ceases once the project is substantially complete and the software is ready for its intended purpose. Internally developed software is amortized using the straight-line method over an estimated useful life of three Trademark Asset On June 10, 2022, the Company entered into an agreement to purchase all of the equity interests of Rush Street Productions, LLC, a Delaware limited liability company (“RSP”), in exchange for $1.5 million cash (net of $0.7 million cash acquired), 480,000 RSILP Units and the same number of newly issued shares of Class V Common Stock, par value $0.0001 per share of the Company (the “Class V Common Stock”), valued at $2.4 million, and 60,000 shares of Class A Common Stock of the Company, par value $0.0001 per share of the Company (the “Class A Common Stock”), valued at $0.3 million. The Company also assumed $0.5 million of outstanding liabilities and incurred $0.4 million of transaction costs directly attributable to the acquisition. To account for the transaction, the Company applied the definition of a business in ASC 805-10, Business Combinations – Overall, and concluded that the asset set acquired does not constitute a business as substantially all of the fair value of the acquired assets was concentrated in a single asset. Therefore, the transaction has been accounted for as an asset acquisition in accordance with ASC 805-50, Business Combinations — Related Issues . The acquired trademark asset represents an intangible asset that is recognized at its relative fair value in accordance with ASC 350-30, General Intangibles Other Than Goodwill . Goodwill is not recognized in an asset acquisition, and as such, any consideration that exceeds the fair value of the net assets acquired is allocated to the identifiable assets based on relative fair values. The Company capitalized a $5.1 million trademark intangible asset representing the total consideration paid of $4.2 million, assumed liabilities of $0.5 million, and legal and consulting fees incurred that were directly attributable to the asset acquisition of $0.4 million. The asset is recognized in intangible assets, net on the Company’s consolidated balance sheets as of December 31, 2023 and 2022 and is amortized over the estimated useful life of five years using the straight-line method. The asset acquisition is presented on the consolidated statement of cash flows as net cash used in investing activities. Developed Technology On December 21, 2021, the Company entered into an agreement to purchase certain assets from Run It Once, Ltd. (“RIO”) in exchange for $3.3 million cash and 158,127 Class A Common Shares valued at $2.5 million. To account for the transaction, the Company applied the definition of a business in ASC 805-10, Business Combinations – Overall, and concluded that the asset set acquired does not constitute a business as the acquired assets did not include the necessary inputs, substantive processes, and outputs needed to operate as a business. Thus, the transaction has been accounted for as an asset acquisition in accordance with ASC 805-50, Business Combinations — Related Issues . The acquired intellectual property represents developed technology intangible assets that are recognized at their relative fair value in accordance with ASC 350-30, General Intangibles Other Than Goodwill . Goodwill is not recognized in an asset acquisition and, as such, any consideration that exceeds the fair value of the net assets acquired is allocated to the identifiable assets based on relative fair values. The Company capitalized a $5.9 million developed technology intangible asset, representing the total consideration paid of $5.8 million and an incremental $0.1 million related to legal fees directly attributable to the asset acquisition incurred by the Company. The asset is recognized in intangible assets, net on the Company’s consolidated balance sheets as of December 31, 2023 and 2022. The asset is amortized over the estimated useful life of eight years using the straight-line method. The asset acquisition is presented on the consolidated statement of cash flows as net cash used in investing activities. Media Content Production Costs The Company capitalizes costs associated with the development and production of media content in accordance with ASC 350, Intangibles - Goodwill and Other . The asset is recognized in intangible assets, net in the Company’s consolidated balance sheet as of December 31, 2023 and is amortized over the estimated useful life of two years. |
Investments in Equity | Investments in Equity The Company accounts for investments in equity that are within the scope of ASC 321-10, Investments - Equity Securities (“ASC 321-10”), as either (1) investments with a readily determinable fair value, which are recorded at fair value or (2) investments without a readily determinable fair value, which are recorded at cost less any impairment. Equity investments that are initially concluded to not have a readily determinable fair value are reassessed at each reporting period. If the Company identifies observable price changes in orderly transactions for the identical or a similar investment of the same issuer, it measures the equity security at fair value as of the date that the observable transaction occurred using valuation techniques that are permitted under ASC 820, Fair Value Measurement . As of December 31, 2023 and 2022, the Company had investments in equity of $2.0 million and $1.5 million, respectively. The equity investments are accounted for in accordance with ASC 321-10, and the Company accounts for the equity investments at cost less impairment because there are no readily determinable fair values for these investments as of December 31, 2023 and 2022. No impairment was recorded during the years ended December 31, 2023 and 2022. The investments are recognized in other assets on the Company’s consolidated balance sheets. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company’s long-lived assets primarily consist of property and equipment, operating lease right-of-use assets, finance lease right-of-use assets and finite-lived intangible assets (i.e., license fees, internally developed software, developed technology, trademark assets and media content production costs). |
Players' Liabilities | Players’ Liabilities The Company’s players’ liabilities include liabilities for customer account balances, the incremental progressive jackpot reserve, and the expected future payout relating to customers’ unredeemed bonus store points and unused discretionary bonus incentives. Customer cash account balances consist of customer deposits, cash winnings and pending cash wagers, less customer cash losses, withdrawals and tax withholdings. The Company’s restricted cash balance, players receivables balance and the value of surety bonds held for the benefit of customers will equal or exceed the customer cash account balances. |
Deferred Royalty | Deferred Royalty The Company records liabilities for minimum royalty payments related to licensing and market access agreements. These liabilities are recorded on the consolidated balance sheets at the present value of future payments discounted using a rate that reflects the duration of the agreement. The deferred royalty liability is accreted through interest expense in the Company’s consolidated statements of operations. The Company records deferred royalty liabilities as either current deferred royalty liabilities, or non-current deferred royalty liabilities based on the timing of future payments. |
Warrant Liabilities | Warrant Liabilities As part of dMY’s initial public offering, dMY issued to third-party investors 23.0 million units, each consisting of one share of dMY’s Class A common stock and one-half of one warrant, at a price of $10.00 per unit. Each whole warrant entitled the holder to purchase one share of Class A common stock at an exercise price of $11.50 per share (the “Public Warrants”). Simultaneously with its initial public offering, dMY sold 6,600,000 private placement warrants to the Sponsor (the “Private Placement Warrants”) and it issued an additional 75,000 warrants to the Sponsor upon the Closing in connection with converting certain working capital loans into warrants (the “Working Capital Warrants” and together with the Private Placement Warrants, the “Private Warrants” and the Private Warrants together with the Public Warrants, the “Warrants”). Each Private Warrant allowed the Sponsor to purchase one share of Class A Common Stock at $11.50 per share. Subsequent to the Business Combination, 11,500,000 Public Warrants and 6,675,000 Private Warrants remained outstanding. None of the Public Warrants or Private Warrants remained outstanding as of December 31, 2023 and 2022. The Private Warrants and the shares of Class A Common Stock issuable upon the exercise of the Private Warrants were not transferable, assignable or salable until after the completion of a business combination, subject to certain limited exceptions. Additionally, the Private Warrants were exercisable for cash or on a cashless basis, at the holder’s option, and were non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants were held by someone other than the initial purchasers or their permitted transferees, the Private Warrants would have become redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. The Company evaluated the Warrants pursuant to ASC 815-40 and concluded that they did not meet the criteria to be classified in stockholders’ equity. Specifically, the exercise of these Warrants may be settled in cash upon the occurrence of a tender offer or exchange that involves 50% or more of our stockholders holding Class A Common Stock. Because not all of the stockholders need to participate in such tender offer or exchange to trigger the potential cash settlement and the Company does not control the occurrence of such an event, the Company concluded that the Warrants did not meet the conditions to be classified in equity. Because the Warrants met the definition of a derivative under ASC 815-40, the Company records these Warrants as liabilities on its consolidated balance sheets at fair value as of each reporting date, with subsequent changes in their respective fair values recognized in its consolidated statements of operations. See Note 7 for additional discussion of the Warrants. |
Earnout Interests Liability | Earnout Interests Liability Earnout interests represent a freestanding financial instrument classified as liabilities on the accompanying consolidated balance sheets as the Company determined that these financial instruments are not indexed to the Company’s own equity in accordance with ASC 815, Derivatives and Hedging . Earnout interests were initially recorded at fair value in the Business Combination and were adjusted to fair value at each reporting date with changes in fair value recorded in change in fair value of earnout interests liability in the consolidated statements of operations. None of the earnout interests remained outstanding as of December 31, 2023 and 2022. See Note 8 for additional discussion of earnout interests. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of operating cash, restricted cash, cash equivalents, and short term investments. The Company maintains cash, restricted cash, cash equivalents, and short term investments primarily across nine financial institutions within separate bank accounts. Any loss incurred, or a lack of access, to such funds could have a significant adverse impact on the Company’s financial condition, results of operations and cash flows. Although the Company maintains balances with certain institutions in excess of the federally insured limits, the Company is not subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships. As of December 31, 2023 and 2022, the Company has not experienced losses on these accounts. |
Leases | Leases The Company determines whether an arrangement is or contains a lease at contract inception. The Company accounts for leases in accordance with ASC 842, Leases , under which arrangements meeting the definition of a lease are classified as operating or finance leases and are recorded on the consolidated balance sheets as both a right-of-use asset and a lease liability. The Company elects to apply the practical expedient that allows for the combination of lease and non-lease components for all asset classes. The lease classification evaluation begins at the lease commencement date. The lease term used in the evaluation includes the non-cancellable period for which the Company has the right to use the underlying asset, together with renewal option periods when the exercise of the renewal option is reasonably certain. For leases with an initial term greater than 12 months, a related lease liability is recorded on the consolidated balance sheets at the present value of future payments discounted using the interest rate implicit in the lease and if not determinable, the estimated fully collateralized incremental borrowing rate (discount rate) corresponding with the lease term. In addition, a right-of-use asset is recorded as the initial amount of the lease liability, plus any lease payments made to the lessor before or at the lease commencement date and any initial direct costs incurred, less any tenant improvement allowance incentives received. Tenant incentives are amortized through the right-of-use asset as a reduction of lease expense over the lease term. The difference between the minimum rents paid and the straight-line rent is reflected within the associated right-of-use asset. Certain leases contain provisions that require variable payments consisting of common area maintenance costs (i.e., variable lease cost). Variable lease costs are expensed as incurred. The Company made an accounting policy election to exclude any short-term lease (i.e., leases with a term of twelve months or less) from the balance sheet. Short-term lease expense is recognized on a straight-line basis over the lease term. When the interest rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate corresponding with the lease term. As the Company does not have any outstanding debt, this rate is determined based on prevailing market conditions and comparable company and credit analysis. The discount rate is reassessed upon a modification that is not accounted for as a separate contract. |
Revenue Recognition | Revenue Recognition Revenue is recognized in accordance with ASC Topic 606, Revenue from Contracts with Customers , when control of the promised goods or services is transferred to the customer, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company determines revenue recognition through the following steps: • Identify the contract with the customer • Identify the performance obligations in the contract • Determine the transaction price • Allocate the transaction price to the performance obligations in the contract • Recognize revenue when, or as, the company satisfies a performance obligation The Company’s revenue from contracts with customers consists of online casino, online sports betting, retail sports betting and social gaming. Online casino and online sports betting Online casino offerings typically include the full suite of games available in land-based casinos, such as table games (i.e., blackjack and roulette) and slot machines. The Company generates revenue from these offerings through hold, or gross winnings, as customers play against the house. Online casino revenue is generated based on total customer bets less amounts paid to customers for winning bets, less other incentives awarded to customers, plus or minus the change in the progressive jackpot liability. Online sports betting involves a user placing a bet on the outcome of a sporting event, sports-related activity, or a series of the same, with the chance to win a pre-determined amount, often referred to as fixed odds. Online sports betting revenue is generated by setting odds such that there is a built-in theoretical margin in each bet offered to customers. Online sports betting revenue is generated based on total customer bets less amounts paid to customers for winning bets, less other incentives awarded to customers, plus or minus the change in unsettled bets. The Company provides various incentives to promote customer engagement, many of which allow customers to place bets without using their own funds. For some incentive programs, benefits are provided to customers based only on past play and represent an option that grants the customer a material right. Other benefits that are provided to customers are more discretionary in nature and may not be related to the customer’s level of play. Performance obligations related to online gaming and sports betting transactions include (1) servicing the customer’s bet, which is fulfilled when the outcome of the bet is known and (2) transferring additional goods or services to a player for which the Company has received consideration, such as bonus store points or other discretionary bonus incentives. Bonus store points as well as discretionary bonus incentives, such as bonus money and bonus bets (collectively referred to herein as “customer bonuses”) are recognized as a reduction to revenue upon issuance of the incentive and as revenue upon redemption by the customer. Reductions to revenue include estimates for the stand-alone selling price of customer bonuses and the percentage of customer bonuses that are expected to be redeemed. The expected redemption percentage is based on historical redemption patterns and considers current information or trends. The estimated redemption rate is evaluated each reporting period. The Company does not believe that there is a reasonable likelihood that there will be a material change in the future estimates or assumptions used to calculate the estimated redemption rate. Adjustments to earnings resulting from revisions to management’s estimates of the redemption rates have not been material during the years ended December 31, 2023 and 2022. Progressive jackpots related to online casino jackpot games are accrued and charged to revenue at the time the obligation to pay the jackpot is established. The progressive jackpot liability is recorded in Players’ liabilities on the consolidated balance sheets. Retail sports betting The Company provides retail sports services to land-based partners in exchange for a monthly commission based on that partner’s retail sportsbook revenue. Services generally include ongoing management and oversight of the retail sportsbook, technical support for the partner’s customers, risk management, advertising and promotion, and support for third-party vendors’ sports betting equipment. The Company has a single performance obligation to provide retail sports services and records the revenue as services are performed and when the commission amounts are no longer constrained (i.e., the amount is known). Certain relationships with business partners provide the Company the ability to operate the retail sportsbook. In this scenario, revenue is generated based on total customer bets less amounts paid to customers for winning bets, less other incentives awarded to customers, plus or minus the change in unsettled retail sports bets. Social gaming The Company provides a social gaming platform for users to enjoy free-to-play games that use virtual credits. While virtual credits are issued to users for free, some users may choose to purchase additional virtual credits through the Company’s virtual cashier. The Company has a single performance obligation associated with social gaming services, to provide social gaming services to users upon the redemption of virtual credits. Deferred revenue is recorded when users purchase virtual credits and revenue is recognized when the virtual credits are redeemed, and the Company’s performance obligation has been fulfilled. Certain costs to obtain or fulfill contracts Pursuant to the accounting guidance, certain costs to obtain or fulfill a contract with a customer must be capitalized to the extent recoverable from the associated contract margin, and subsequently amortized as the products or services are delivered to the customer. These costs are capitalized as contract acquisition costs and are amortized over the period of benefit to the customer. For the Company, the period of benefit has been determined to be less than or equal to one year. As such, the Company applied the practical expedient and contract acquisition costs are expensed immediately. Customer contract costs that do not qualify for capitalization as contract fulfillment costs are expensed as incurred. Contract balances Contract assets and liabilities represent the differences in timing between the fulfillment of the Company's performance obligations and the receipt of cash from the Company's customers. The Company does not have material contract assets. The Company’s contract liabilities consist of deferred revenue. Deferred revenue represents wagered amounts that relate to unsettled or pending outcomes, such as a future sports bet. The Company recognizes revenue once the outcome of the bet is settled and fixed. Deferred revenue also includes contract liabilities for the Company’s obligation to transfer additional goods or services to a customer for which the Company has received consideration, such as bonus store points. The Company recognizes breakage on these liabilities proportionately as redemption occurs. Revenue recognized relating to breakage during the years ended December 31, 2023 and 2022 was not material to the consolidated financial statements. Deferred revenue relating to unsettled customer bets and unredeemed customer incentives is recorded in Players’ liabilities on the consolidated balance sheets. Deferred revenue relating to the Company’s social gaming services includes virtual credits purchased by users but not yet redeemed and is recorded in other current liabilities on the consolidated balance sheets. Principal versus agent considerations The Company evaluates the criteria outlined in ASC 606-10-55, Principal versus Agent Considerations , in determining whether it is appropriate to record the gross amount of revenues and related costs, or the net amount earned as commissions. When the Company is the principal in a transaction and controls the specific good or service before it is transferred to the customer, revenue is recorded gross; otherwise, revenue is recorded on a net basis. The Company controls the promised goods or services for online casino and sports betting transactions, retail sports betting transactions and social gaming services, and as a result records related revenue on a gross basis. For retail sports service arrangements, the Company does not control the promised goods or services and, therefore, records the net amount of revenue earned as a commission. See Note 3 for a disaggregation of the Company’s revenues. |
Costs of Revenue | Costs of Revenue Costs of revenue consist primarily of (i) revenue share and market access fees which is reduced by any consideration received from the vendor, (ii) 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 amounts paid to local land-based partners that hold the applicable gaming license, providing us the ability to offer our real-money online offerings in the respective jurisdictions. The Company’s 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 relate to state taxes that are determined on a jurisdiction-by-jurisdiction basis, or federal excise taxes that are determined based on a percentage of the value of online sports and retail sports bets. The Company incurs payment processing costs on player deposits and occasionally chargebacks (i.e., when a payment processor contractually disallows customer deposits in the normal course of business). |
Advertising and Promotions Costs | Advertising and Promotions Costs Advertising and promotion costs consist primarily of marketing the Company’s 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. |
General and Administrative | General and Administrative General and administrative expenses consist primarily of administrative personnel costs, including salaries, bonuses and benefits, share-based compensation expenses, professional service fees (related to legal, compliance, accounting and consulting), rent expense and insurance costs. |
Share-Based Compensation | Share-Based Compensation The Company records share-based compensation in accordance with ASC 718, Compensation—Stock Compensation , and recognizes share-based compensation expense in the period in which a grantee is required to provide service, which is generally over the vesting period of the individual share-based payment award. Compensation expense for awards with performance conditions is not recognized until it is probable that the performance target will be achieved. Compensation expense for awards is recognized over the requisite service period on a straight-line basis. The Company accounts for forfeitures as they occur. The Company classifies unit awards as either an equity award or a liability award depending on whether the award contains certain repurchase provisions. Equity-classified awards are valued as of the grant date based upon the price of the underlying unit or share and a number of assumptions, including volatility, performance period, risk-free interest rate and expected dividends. Liability-classified awards are valued at fair value at each reporting date. See Note 10 for additional information about share-based compensation. |
Income Taxes | Income Taxes Rush Street Interactive, Inc. is a corporation and, as a result, is subject to U.S. federal, state and foreign income taxes. RSILP is treated as a partnership for U.S. federal income tax purposes and therefore does not pay U.S. federal income tax on its taxable income. Instead, the RSILP unitholders, including the Company, are liable for U.S. federal income tax on their respective shares of RSILP’s taxable income reported on the unitholders’ U.S. federal income tax returns. RSILP is liable for income taxes in those states not recognizing its status as a partnership for U.S. federal income tax purposes. The Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are calculated by applying existing tax laws and the rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the year of the enacted rate change. The Company recognizes deferred tax assets to the extent it believes these assets are more-likely-than-not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent results of operations. The Company accounts for uncertainty in income taxes using a recognition and measurement threshold for tax positions taken or expected to be taken in a tax return, which are subject to examination by applicable taxing authorities. The tax benefit from an uncertain tax position is recognized when it is more-likely-than-not that the position will be sustained upon examination by taxing authorities based on technical merits of the position. The amount of the tax benefit recognized is the largest amount of the benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The effective tax rate and the tax basis of assets and liabilities reflect management’s estimates of the ultimate outcome of various tax uncertainties. The Company recognizes penalties and interest related to uncertain tax positions within the provision (benefit) for income taxes line in the accompanying consolidated statements of operations. See Note 11, “Income Taxes” for additional information regarding income taxes. |
Tax Receivable Agreement | Tax Receivable Agreement In connection with the Business Combination, the Special Limited Partner entered into the TRA, which generally provides for the payment by it of 85% of certain net tax benefits, if any, that the Company (including the Special Limited Partner) realize (or in certain cases is deemed to realize) as a result of these 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 at the Company’s option) pursuant to the RSILP A&R LPA and tax benefits related to entering into the TRA, including tax benefits attributable to payments under the TRA. These payments are the obligation of the Special Limited Partner and not of RSILP. The actual increase in the Special Limited Partner’s allocable share of RSILP’s tax basis in its assets, as well as the amount and timing of any payments under the TRA, will vary depending upon a number of factors, including the timing of exchanges, the market price of the Class A Common Stock at the time of the exchange and the amount and timing of the recognition of the Company’s and its consolidated subsidiaries’ (including the Special Limited Partner’s) income. While many of the factors that will determine the amount of payments that the Special Limited Partner will make under the TRA are outside of the Company’s control, the Company expects that the payments the Special Limited Partner will make under the TRA will be substantial and could have a material adverse effect on the financial condition of the Company. The Company evaluates 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, the Company then assesses whether payment of amounts under the TRA have become probable. If so, the Company records a TRA liability equal to 85% of such deferred tax assets. In subsequent periods, the Company assesses the realizability of all of its 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. The measurement of the TRA liability is accounted for as a contingent liability. Therefore, once the Company determines that a payment becomes probable and can be estimated, the estimate of the payment will be accrued. |
Loss Per Share | Loss Per Share Basic net loss per share of Class A Common Stock is computed by dividing net earnings attributable to RSI by the weighted-average number of shares of Class A Common Stock outstanding during the same period. |
Foreign Currency | Foreign Currency The Company’s reporting currency is the U.S. dollar while the functional currency of subsidiaries not deemed to be the U.S. dollar include the Colombian Peso, Mexican Peso and Canadian Dollar. The financial statements of non-U.S. subsidiaries are translated into U.S. dollars in accordance with ASC 830, Foreign Currency Matters , using period-end exchange rates for assets and liabilities, and average exchange rates for the period for revenues, costs, and expenses and historical exchange rates for equity. Translation adjustments resulting from the process of translating the local currency financial statements into U.S. dollars are included in determining other comprehensive income (loss). If transactions are recorded in a currency other than the subsidiary’s functional currency, remeasurement into the functional currency is required and may result in transaction gains or losses. Transaction gains (losses) were $0.9 million, $(1.9) million and less than $(0.1) million for the years ended December 31, 2023, 2022 and 2021, respectively. Amounts are recorded in general and administrative on the Company’s consolidated statements of operations. |
Fair Value Measurements | Fair Value Measurements Fair value measurements are based on the premise that fair value is an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the following three-tier fair value hierarchy has been used in determining the inputs used in measuring fair value: • Level 1 – Quoted prices in active markets for identical assets or liabilities on the reporting date. • Level 2 – Pricing inputs are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 – Pricing inputs are generally unobservable and include situations where there is little, if any, market activity for the investment. The inputs into the determination of fair value require management’s judgment or estimation of assumptions that market participants would use in pricing the assets or liabilities. The fair values are therefore determined using factors that involve considerable judgment and interpretations, including but not limited to private and public comparables, third-party appraisals, discounted cash flow model and fund manager estimates. Financial instruments measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Management’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The use of different assumptions and/or estimation methodologies may have a material effect on estimated fair values. Accordingly, the fair value estimates disclosed or initial amounts recorded may not be indicative of the amount that the Company or holders of the instruments could realize in a current market exchange. As of December 31, 2023 and 2022, the recorded values of current assets and current liabilities approximate fair value due to the short-term nature of these instruments. |
Recently Adopted Accounting Pronouncements And Recent Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments – Credit Losses (Topic 326) . Together with subsequent amendments, this ASU sets forth a “current expected credit loss” model, which requires the Company to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions and reasonable supportable forecasts. This ASU replaces the existing “incurred loss” model and is applicable to the measurement of credit losses on financial assets measured at amortized cost, available-for-sale debt securities and applies to certain off-balance sheet credit exposures. This ASU is effective for the Company in calendar year 2023. The Company adopted ASU 2016-13 and the subsequent amendments on January 1, 2023, and the adoption did not have a material impact on its consolidated financial statements and related disclosures. Recent Accounting Pronouncements Not Yet Adopted In August 2020, the FASB issued ASU 2020-6, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity , which simplifies accounting for convertible instruments by removing major separation models required under current U.S. GAAP. This ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, and it also simplifies the diluted earnings per share calculation in certain areas. This ASU is effective for the Company for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2021, and adoption must be as of the beginning of the Company’s annual fiscal year. The Company is currently evaluating the impact of this ASU on its consolidated financial statements and related disclosures. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280). The amendments in this ASU require disclosures, on an annual and interim basis, of significant segment expenses that are regularly provided to the CODM, as well as the aggregate amount of other segment items included in the reported measure of segment profit or loss. This ASU requires that a public entity disclose the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss. Public entities will be required to provide all annual disclosures currently required by Topic 280 in interim periods, and entities with a single reportable segment are required to provide all the disclosures required by the amendments in the update and existing segment disclosures in Topic 280. This ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, and requires retrospective adoption. Early adoption is permitted. The Company will adopt this standard beginning with our fiscal year ending December 31, 2024. The Company is currently evaluating these new disclosure requirements and does not expect the adoption to have a material impact. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which is intended to enhance the transparency, decision usefulness and effectiveness of income tax disclosures. The amendments in this ASU require a public entity to disclose a tabular tax rate reconciliation, using both percentages and currency, with specific categories. A public entity is also required to provide a qualitative description of the states and local jurisdictions that make up the majority of the effect of the state and local income tax category and the net amount of income taxes paid, disaggregated by federal, state and foreign taxes and also disaggregated by individual jurisdictions. The amendments also remove certain disclosures that are no longer considered cost beneficial. The amendments are effective prospectively for annual periods beginning after December 15, 2024, and early adoption and retrospective application are permitted. The Company is currently evaluating the impact of these new disclosure requirements on its consolidated financial statements. |
Description of Business (Tables
Description of Business (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Products and Services by Location | As of December 31, 2023, RSI offered real-money online casino, online sports betting and/or retail sports betting in the 15 U.S. states and three international jurisdictions as outlined in the table below. Jurisdictions Online Casino Online Sports Retail Sports Domestic: Arizona ü Colorado ü Delaware ü ü Illinois ü ü Indiana ü ü Iowa ü Louisiana ü Maryland ü ü Michigan ü ü ü New Jersey ü ü New York ü ü Ohio ü Pennsylvania ü ü ü Virginia ü ü West Virginia ü ü International: Colombia ü ü Ontario (Canada) ü ü Mexico ü ü |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Cash and Cash Equivalents | The following table reconciles cash and cash equivalents and restricted cash in the consolidated balance sheets to the totals shown on the consolidated statements of cash flows: December 31, ($ in thousands) 2023 2022 Cash and cash equivalents (1) $ 168,330 $ 179,723 Restricted cash 2,647 26,358 Total cash, cash equivalents and restricted cash $ 170,977 $ 206,081 (1) The Company had cash equivalents of $78.4 million and $1.0 million as of December 31, 2023 and 2022, respectively. Cash equivalents are composed of money market funds and certificates of deposits with original maturities of 90 days or less. Money market funds of $68.7 million are valued using quoted market prices as of December 31, 2023. The Company did not have money market funds as of December 31, 2022. |
Property, Plant and Equipment | Additions and improvements are capitalized, while repairs and maintenance are expensed as incurred. Useful lives of each asset class are as follows: Asset Useful Life Computers, software and related equipment 3 years Furniture and fixtures 4 years Operating equipment and servers 5 years Leasehold improvements Lesser of the lease terms or the estimated useful lives of the improvements, generally 1–10 years As set forth in the table below, property and equipment, net as of December 31, 2023 and 2022 are $8.6 million and $9.8 million, respectively. The balances as of December 31, 2023 and 2022 also include finance lease right-of-use assets, net. The balances consist of the following: December 31, ($ in thousands) 2023 2022 Computers, software and related equipment $ 5,541 $ 4,050 Operating equipment and servers 4,779 4,610 Furniture 647 600 Leasehold improvements 658 640 Property and equipment not yet placed into service 610 816 Total property and equipment 12,235 10,716 Less: accumulated depreciation (7,641) (3,818) 4,594 6,898 Finance lease right-of-use assets 5,519 3,112 Less: accumulated amortization (1,502) (246) 4,017 2,866 Property and equipment, net $ 8,611 $ 9,764 |
Revenue Recognition (Table)
Revenue Recognition (Table) | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Disaggregation of Revenue | Disaggregation of revenue for the years ended December 31, 2023, 2022 and 2021 is as follows: Years Ended ($ in thousands) 2023 2022 2021 Online casino and online sports betting $ 674,059 $ 576,573 $ 480,065 Retail sports betting 12,848 11,713 3,828 Social gaming 4,254 3,926 4,212 Total revenue $ 691,161 $ 592,212 $ 488,105 |
Summary of Revenue by Geographic Region | The following table presents the Company’s revenue by geographic region for the years ended December 31, 2023, 2022 and 2021: Years Ended ($ in thousands) 2023 2022 2021 United States and Canada $ 611,868 $ 539,887 $ 452,607 Latin America, including Mexico 79,293 52,325 35,498 Total revenue $ 691,161 $ 592,212 $ 488,105 |
Summary of Deferred Revenue | The deferred revenue activity for the years ended December 31, 2023, 2022 and 2021 was as follows: Years Ended ($ in thousands) 2023 2022 2021 Deferred revenue, beginning of period $ 7,840 $ 4,637 $ 1,797 Deferred revenue, end of period 7,013 7,840 4,637 Revenue recognized in the year from amounts included in deferred revenue at the beginning of the year 7,840 4,637 1,797 |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Schedule of Intangible Assets, net | The Company has the following intangible assets, net as of December 31, 2023 and 2022, respectively: ($ in thousands) Weighted Average Gross Accumulated Net License Fees December 31, 2023 7.75 $ 61,015 $ (25,946) $ 35,069 December 31, 2022 8.44 $ 54,334 $ (12,363) $ 41,971 Internally Developed Software December 31, 2023 2.37 $ 43,868 $ (12,601) $ 31,267 December 31, 2022 2.51 $ 20,860 $ (3,490) $ 17,370 Developed Technology December 31, 2023 6.00 $ 5,931 $ (1,483) $ 4,448 December 31, 2022 7.00 $ 5,931 $ (741) $ 5,190 Trademark Asset December 31, 2023 3.42 $ 5,088 $ (1,611) $ 3,477 December 31, 2022 4.42 $ 5,088 $ (594) $ 4,494 Content December 31, 2023 1.60 $ 785 $ (172) $ 613 December 31, 2022 N/A $ — $ — $ — |
Schedule of estimated future amortization of license fees | At December 31, 2023, estimated future amortization of intangible assets is as follows: ($ in thousands) Year ended December 31, 2024 $ 21,426 Year ended December 31, 2025 18,126 Year ended December 31, 2026 11,818 Year ended December 31, 2027 6,141 Year ended December 31, 2028 4,888 Thereafter 12,475 Total $ 74,874 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Additions and improvements are capitalized, while repairs and maintenance are expensed as incurred. Useful lives of each asset class are as follows: Asset Useful Life Computers, software and related equipment 3 years Furniture and fixtures 4 years Operating equipment and servers 5 years Leasehold improvements Lesser of the lease terms or the estimated useful lives of the improvements, generally 1–10 years As set forth in the table below, property and equipment, net as of December 31, 2023 and 2022 are $8.6 million and $9.8 million, respectively. The balances as of December 31, 2023 and 2022 also include finance lease right-of-use assets, net. The balances consist of the following: December 31, ($ in thousands) 2023 2022 Computers, software and related equipment $ 5,541 $ 4,050 Operating equipment and servers 4,779 4,610 Furniture 647 600 Leasehold improvements 658 640 Property and equipment not yet placed into service 610 816 Total property and equipment 12,235 10,716 Less: accumulated depreciation (7,641) (3,818) 4,594 6,898 Finance lease right-of-use assets 5,519 3,112 Less: accumulated amortization (1,502) (246) 4,017 2,866 Property and equipment, net $ 8,611 $ 9,764 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses and Other Current Liabilities | The following table provides a summary of the accrued expenses at December 31, 2023 and 2022: December 31, ($ in thousands) 2023 2022 Accrued compensation and related expenses $ 13,896 $ 10,077 Accrued operating expenses 21,748 24,256 Accrued marketing expenses 9,319 27,315 Accrued administrative expenses 5,506 1,622 Other 843 1,633 Total accrued expenses $ 51,312 $ 64,903 |
Warrant Liabilities (Tables)
Warrant Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Warrants and Rights Note Disclosure [Abstract] | |
Fair Value Measurement Inputs and Valuation Techniques | The following table provides quantitative information regarding Level 3 fair value measurement inputs at their measurement dates: March 26, December 31, Exercise price $ 11.50 $ 11.50 Stock price $ 15.96 $ 22.76 Volatility 42.6% 41.4% Term (years) 4.77 5.00 Risk-free interest rate 0.76% 0.37% The range and weighted-average of the significant inputs used to fair value Level 3 recurring liabilities during the year ended December 31, 2020, along with the valuation techniques used, are shown in the following table: Fair Value Valuation Observable (O) or Range Earnout interests liability $ 351,048 Option pricing model Share price (O) $21.51 - $21.65 Volatility (U) 54.6% Term (U) 2.99 years Risk-free rate (O) 0.17% |
Schedule Of Warrant Liabilities, Activity | The following table summarizes the fair values of warrant liabilities and change in fair value at each measurement date: ($ in thousands) Public Warrants (Level 1) Private Warrants (Level 3) Total Fair value of warrants at December 31, 2020 $ 88,079 $ 82,030 $ 170,109 Change in fair value of warrant liability (10,570) (31,232) (41,802) Fair value of warrants at redemption (77,509) (50,798) (128,307) Fair value of warrants at December 31, 2021 $ — $ — $ — |
Earnout Interests Liability (Ta
Earnout Interests Liability (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnout Interests Liability [Abstract] | |
Fair Value Measurement Inputs and Valuation Techniques | The following table provides quantitative information regarding Level 3 fair value measurement inputs at their measurement dates: March 26, December 31, Exercise price $ 11.50 $ 11.50 Stock price $ 15.96 $ 22.76 Volatility 42.6% 41.4% Term (years) 4.77 5.00 Risk-free interest rate 0.76% 0.37% The range and weighted-average of the significant inputs used to fair value Level 3 recurring liabilities during the year ended December 31, 2020, along with the valuation techniques used, are shown in the following table: Fair Value Valuation Observable (O) or Range Earnout interests liability $ 351,048 Option pricing model Share price (O) $21.51 - $21.65 Volatility (U) 54.6% Term (U) 2.99 years Risk-free rate (O) 0.17% |
Schedule Of Earnout Interests Liability, Activity | Earnout Interests Liability ($ in thousands) Total December 31, 2020 $ 351,048 Change in fair value of earnout interests liability 13,740 Settlement of earnout interests liability (364,788) December 31, 2021 $ — |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Schedule of Noncontrolling Interests | The following table summarizes the changes in non-controlling interests owned: Non-Controlling Interest % Non-controlling interest % as of December 31, 2022 70.55 % Issuance of Class A Common Stock upon RSILP Unit Exchanges (2.49) % Issuance of Class A Common Stock in connection with the vesting of certain share-based equity grants (0.55) % Non-controlling interest % as of December 31, 2023 67.51 % The non-controlling interests owned 70.55% and 72.20% of the RSILP Units outstanding as of December 31, 2022 and 2021, respectively. The following table summarizes the changes in non-controlling interests owned: Non-Controlling Interest % Non-controlling interest % as of December 31, 2021 72.20 % Issuance of Class A Common Stock upon the conversion of RSILP Unit Exchanges (1.46) % Issuance of Class A Common Stock as purchase consideration (0.02) % Issuance of Class V Common Stock as purchase consideration 0.06 % Issuance of Class A Common Stock in connection with the vesting of certain share-based equity grants (0.23) % Non-controlling interest % as of December 31, 2022 70.55 % |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | RSUs with market-based conditions generally vest over a three year period and the fair value was determined using a Monte Carlo simulation using the following range of assumptions: December 31, December 31, Volatility rate 69.78 % 70.93% to 71.00% Risk-free interest rate 3.85 % 4.32% to 4.39% Average expected life (in years) 2.8 2.3 to 3.0 Dividend yield None None Stock price at grant date $ 3.28 $ 3.95 December 31, December 31, Volatility rate 70.00 % 58.98 % Risk-free interest rate 3.80 % 3.68 % Average expected life (in years) 6.0 5.6 Dividend yield None None Stock price at grant date $ 3.28 $ 4.07 Exercise price $ 3.28 $ 4.07 |
Schedule of Stock Options Roll Forward | RSU activity for the years ended December 31, 2023 and 2022 was as follows: Number of Weighted average grant price Unvested balance at December 31, 2021 3,076,158 $ 16.08 Granted 5,542,010 4.17 Vested (1) (1,020,874) 14.67 Forfeited (104,681) 14.36 Unvested balance at December 31, 2022 7,492,613 $ 7.48 Granted 4,030,535 4.12 Vested (1) (2,221,870) 8.71 Forfeited (83,136) 9.52 Unvested balance at December 31, 2023 9,218,142 $ 5.70 _____________________________ (1) Include 467,712 and 253,787 of RSUs that vested during the years ended December 31, 2023 and 2022, respectively, for which the resulting shares of Class A Common Stock have not yet been issued. There were 1,104,629 and 636,917 RSUs that vested for which the resulting shares of Class A Common Stock were not issued as of December 31, 2023 and 2022, respectively. Stock option activity for the years ended December 31, 2023 and 2022 was as follows: Number of Units Weighted average exercise price Outstanding balance at December 31, 2021 96,827 $ 15.40 Granted 790,339 4.07 Exercised — — Forfeited — — Outstanding balance at December 31, 2022 887,166 5.31 Granted 1,084,445 3.28 Exercised — — Forfeited — — Outstanding balance at December 31, 2023 1,971,611 $ 4.19 Exercisable balance at December 31, 2023 328,002 $ 6.30 |
Schedule of Unvested Restricted Stock Units Roll Forward | RSU activity for the years ended December 31, 2023 and 2022 was as follows: Number of Weighted average grant price Unvested balance at December 31, 2021 3,076,158 $ 16.08 Granted 5,542,010 4.17 Vested (1) (1,020,874) 14.67 Forfeited (104,681) 14.36 Unvested balance at December 31, 2022 7,492,613 $ 7.48 Granted 4,030,535 4.12 Vested (1) (2,221,870) 8.71 Forfeited (83,136) 9.52 Unvested balance at December 31, 2023 9,218,142 $ 5.70 _____________________________ (1) Include 467,712 and 253,787 of RSUs that vested during the years ended December 31, 2023 and 2022, respectively, for which the resulting shares of Class A Common Stock have not yet been issued. There were 1,104,629 and 636,917 RSUs that vested for which the resulting shares of Class A Common Stock were not issued as of December 31, 2023 and 2022, respectively. Stock option activity for the years ended December 31, 2023 and 2022 was as follows: Number of Units Weighted average exercise price Outstanding balance at December 31, 2021 96,827 $ 15.40 Granted 790,339 4.07 Exercised — — Forfeited — — Outstanding balance at December 31, 2022 887,166 5.31 Granted 1,084,445 3.28 Exercised — — Forfeited — — Outstanding balance at December 31, 2023 1,971,611 $ 4.19 Exercisable balance at December 31, 2023 328,002 $ 6.30 |
Share-based Payment Arrangement, Expensed and Capitalized, Amount | Share-based compensation expense for the years ended December 31, 2023, 2022 and 2021 was as follows: Years Ended ($ in thousands) 2023 2022 2021 Costs of revenue $ 1,064 $ 987 $ 1,808 Advertising and promotions 2,225 2,048 3,605 General and administrative 26,731 15,656 19,499 Total share-based compensation expense $ 30,020 $ 18,691 $ 24,912 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The components of the income tax expense are: Years Ended ($ in thousands) 2023 2022 2021 Current income taxes: Federal $ (188) $ (118) $ 149 State and local 9 (34) 25 Foreign 11,602 9,137 4,551 11,423 8,985 4,725 Deferred income taxes: Federal — — — State and local — — — Foreign (214) (24) (37) (214) (24) (37) Income tax expense $ 11,209 $ 8,961 $ 4,688 |
Schedule of Effective Income Tax Rate Reconciliation | Reconciliations of income tax expense computed at the U.S. federal statutory income tax rate to the recognized income tax expense and the U.S. statutory income tax rate to our effective tax rates are as follows: Years Ended ($ in thousands) 2023 2022 2021 Net loss before income taxes $ (48,846) $ (125,371) $ (66,404) Less: net loss before income taxes attributable to non-controlling interest (33,820) (89,224) (48,258) Net loss attributable to Rush Street Interactive Inc. before income taxes (15,026) (36,147) (18,146) Income tax benefit at the federal statutory rate (3,155) (7,591) (3,811) State income taxes, net of federal benefit (46) (34) 25 Nondeductible stock compensation 1,351 — — Foreign operations 11,387 9,113 4,514 Change in valuation allowance 2,589 8,025 4,027 Other (917) (552) (67) Income tax expense $ 11,209 $ 8,961 $ 4,688 |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the deferred tax assets and liabilities are as follows: Years Ended ($ in thousands) 2023 2022 Deferred tax assets: Investment in subsidiaries $ 134,283 $ 134,586 Net operating losses 29,724 26,394 Imputed interest 2,120 1,638 Share-based compensation 1,160 366 Other assets 422 165 Total gross deferred tax assets 167,709 163,149 Valuation allowance (167,305) (163,029) Total deferred tax assets, net of valuation allowance 404 120 Deferred tax liabilities: Investment in subsidiaries — — Total gross deferred tax liabilities — — Net deferred tax assets $ 404 $ 120 |
Loss Per Share (Tables)
Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings (Loss) Loss per Share | The computation of net loss per share attributable to RSI and weighted-average shares of the Company’s Class A Common Stock outstanding for the years ended December 31, 2023, 2022 and 2021 are as follows (amounts in thousands, except for share and per share amounts): Years Ended 2023 2022 2021 Numerator: Net loss $ (60,055) $ (134,332) $ (71,092) Less: Net loss attributable to non-controlling interests (41,750) (95,701) (51,603) Net loss attributable to Rush Street Interactive, Inc. – basic (18,305) (38,631) (19,489) Effect of dilutive securities: Public, Private Placement and Working Capital Warrants, net of amounts attributable to non-controlling interests — — (9,569) Net loss attributable to Rush Street Interactive, Inc. – diluted $ (18,305) $ (38,631) $ (29,058) Denominator Weighted average common shares outstanding – basic 68,508,093 63,532,906 56,265,541 Weighted average effect of dilutive securities: Public Warrants (1) — — 677,746 Private Placement and Working Capital Warrants (1) — — 483,598 Weighted average common shares outstanding – diluted 68,508,093 63,532,906 57,426,885 Net loss per Class A Common Share - basic $ (0.27) $ (0.61) $ (0.35) Net loss per Class A Common Share - diluted $ (0.27) $ (0.61) $ (0.51) (1) Calculated using the treasury stock method. |
Schedule of Anti-dilutive Securities Excluded from Computation of Diluted Shares Outstanding | The Company excluded the following securities from its computation of diluted shares outstanding, as their effect would have been anti-dilutive: December 31, 2023 2022 2021 RSILP Units (1) 150,434,310 155,955,584 158,702,329 Unvested RSUs 9,218,142 7,492,613 3,076,158 Vested RSUs (2) 1,104,629 636,917 383,130 Outstanding Stock Options 1,971,611 887,166 96,827 (1) RSILP Units that are held by non-controlling interest holders and may be exchanged, subject to certain restrictions, for Class A Common Stock. Upon exchange of an RSILP Unit, a share of Class V Common Stock is cancelled. (2) RSUs that vested but the resulting shares of Class A Common Stock have not yet been issued. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Lease, Cost | The components of lease expense for the years ended December 31, 2023, 2022 and 2021 were as follows: Years Ended ($ in thousands) 2023 2022 2021 Operating lease cost $ 770 $ 676 $ 268 Variable lease cost 267 275 528 Short-term lease cost 867 436 179 Finance lease cost: Amortization of finance lease right-of-use asset 1,272 578 228 Interest on finance lease liabilities 85 22 27 Total lease expenses $ 3,261 $ 1,987 $ 1,230 Additional information relating to leases for the years ended December 31, 2023, 2022 and 2021 was as follows: Years Ended ($ in thousands) 2023 2022 2021 Operating cash flows from operating leases $ 732 $ 653 $ 355 Right-of-use assets obtained in exchange for new or modified operating lease liabilities $ 210 $ 965 $ 810 Right-of-use assets obtained in exchange for new or modified finance lease liabilities $ 2,423 $ 1,124 $ 2,547 Weighted-average remaining lease term (in years) – operating leases 2.5 3.1 3.2 Weighted-average remaining lease term (in years) – finance leases 3.4 3.0 4.6 Weighted-average discount rate – operating leases 6.7 % 6.2 % 6.0 % Weighted-average discount rate – finance leases 7.7 % 6.0 % 6.0 % |
Lessee, Balance Sheet Disclosures | The Company records lease activity within the following financial statement line items: Account Financial Statement Line Item Operating lease right-of-use asset Operating lease assets Finance lease right-of-use asset, net Property and equipment, net Operating lease liabilities Current and non-current operating lease liabilities Finance lease liabilities Other current liabilities and Other non-current liabilities Operating lease expense General and administrative Finance lease amortization expense Depreciation and amortization Finance lease interest expense Interest income (expense), net |
Lessee, Operating Lease, Liability, Maturity | Maturity of operating lease liabilities as of December 31, 2023 is as follows: ($ in thousands) Year ending December 31, 2024 $ 686 Year ending December 31, 2025 392 Year ending December 31, 2026 214 Year ending December 31, 2027 125 Year ending December 31, 2028 — Total undiscounted future cash flows 1,417 Less: present value discount (123) Operating lease liabilities $ 1,294 |
Finance Lease, Liability, Fiscal Year Maturity | Maturity of finance lease liabilities as of December 31, 2023 is as follows: ($ in thousands) Year ending December 31, 2024 $ 873 Year ending December 31, 2025 873 Year ending December 31, 2026 318 Year ending December 31, 2027 230 Year ending December 31, 2028 214 Total undiscounted future cash flows 2,508 Less: present value discount (291) Finance lease liabilities $ 2,217 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Payments Under Non-cancelable Terms of Contracts | The Company is a party to several non-cancelable contracts with vendors and licensors for marketing and other strategic partnership related agreements. Under the non-cancelable terms of these contracts, the Company is obligated to make future minimum payments as follows: ($ in thousands) Year ending December 31, 2024 $ 13,653 Year ending December 31, 2025 7,880 Year ending December 31, 2026 5,565 Year ending December 31, 2027 5,165 Year ending December 31, 2028 4,728 Thereafter 26,975 Total (1) $ 63,966 (1) Includes operating lease and finance lease obligations under non-cancelable lease contracts totaling $6.0 million, obligations under non-cancelable contracts with marketing vendors totaling $11.1 million, and license and market access commitments totaling $46.9 million. Certain market access arrangements require the Company to make additional payments at a contractual milestone date if the market access fees paid up until that milestone date do not meet a minimum contractual threshold. In these instances, the Company calculates future minimum payment as the total milestone payment less any amounts already paid to the partner and includes such payments in the period in which the milestone date occurs. |
Description of Business (Detail
Description of Business (Details) | Dec. 31, 2023 segment |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of states in which entity operates | 15 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Narrative (Details) | 12 Months Ended | ||||||
Jun. 10, 2022 USD ($) $ / shares shares | Dec. 21, 2021 USD ($) shares | Dec. 29, 2020 $ / shares shares | Dec. 31, 2023 USD ($) segment $ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) shares | Dec. 31, 2020 USD ($) | |
Accounting Policies [Line Items] | |||||||
Operating cash flows | $ (5,932,000) | $ (60,321,000) | $ (48,186,000) | ||||
Working capital | $ 90,900,000 | ||||||
Number of operating segments | segment | 1 | ||||||
Allowance for doubtful accounts | $ 0 | 0 | |||||
Prepaid expenses | 7,500,000 | 5,600,000 | |||||
Short-term investments | 3,100,000 | 0 | |||||
Payments to acquire businesses and interest in affiliates | 2,000,000 | 1,500,000 | |||||
Impairment | 0 | 0 | |||||
Earnout interests liability | 0 | $ 351,048,000 | |||||
Conversion ratio | 0.5 | ||||||
Fair value of private warrants | 0 | 0 | 0 | $ 170,109,000 | |||
Foreign currency translation adjustment | 900,000 | (1,900,000) | $ (100,000) | ||||
Surety Bond, Satisfy Regulatory Requirements to Secure Cash Held for Customers | |||||||
Accounting Policies [Line Items] | |||||||
Surety bonds | 28,000,000 | ||||||
Surety Bond, Satisfy Regulatory Requirements Necessary to Operate | |||||||
Accounting Policies [Line Items] | |||||||
Surety bonds | $ 4,600,000 | 3,600,000 | |||||
Media Content | |||||||
Accounting Policies [Line Items] | |||||||
Finite-lived intangible asset, useful life | 2 years | ||||||
Public Warrants | |||||||
Accounting Policies [Line Items] | |||||||
Cash proceeds from warrants exercised | $ 131,600,000 | ||||||
Warrants outstanding (in shares) | shares | 0 | 0 | 11,500,000 | ||||
Private Warrants | |||||||
Accounting Policies [Line Items] | |||||||
Warrants outstanding (in shares) | shares | 0 | 0 | 6,675,000 | ||||
Owners Other Than Rush Street Interactive | RSILP | |||||||
Accounting Policies [Line Items] | |||||||
Noncontrolling ownership interest | 67.51% | 70.55% | 72.20% | ||||
Special Limited Partner | |||||||
Accounting Policies [Line Items] | |||||||
Tax receivable agreement, percentage of net certain tax benefits payable | 85% | ||||||
Special Limited Partner | RSILP | |||||||
Accounting Policies [Line Items] | |||||||
Controlling ownership interest | 0.3249 | ||||||
IPO | Public Warrants | |||||||
Accounting Policies [Line Items] | |||||||
Number of shares issuable per warrant (in shares) | shares | 1 | ||||||
Exercise price of warrants (in USD per share) | $ / shares | $ 11.50 | ||||||
IPO | dMy Technology Group, Inc. | |||||||
Accounting Policies [Line Items] | |||||||
Number of units issued (in shares) | shares | 23,000,000 | ||||||
Price per unit (in USD per share) | $ / shares | $ 10 | ||||||
Private Placement | dMy Technology Group, Inc. | Private Warrants | |||||||
Accounting Policies [Line Items] | |||||||
Number of units issued (in shares) | shares | 6,600,000 | ||||||
Minimum | Computer Software, Intangible Asset | |||||||
Accounting Policies [Line Items] | |||||||
Finite-lived intangible asset, useful life | 3 years | ||||||
Maximum | Computer Software, Intangible Asset | |||||||
Accounting Policies [Line Items] | |||||||
Finite-lived intangible asset, useful life | 4 years | ||||||
Maximum | Developed Technology | |||||||
Accounting Policies [Line Items] | |||||||
Finite-lived intangible asset, useful life | 8 years | ||||||
ROI Assets | |||||||
Accounting Policies [Line Items] | |||||||
Payments for asset acquisition | $ 3,300,000 | ||||||
ROI Assets | Intellectual Property | |||||||
Accounting Policies [Line Items] | |||||||
Asset acquisition, legal fees | 100,000 | ||||||
Asset acquisition, capitalized amount | 5,900,000 | ||||||
Payments for asset acquisition | $ 5,800,000 | ||||||
Rush Street Productions, LLC | |||||||
Accounting Policies [Line Items] | |||||||
Finite-lived intangible asset, useful life | 5 years | ||||||
Payments to acquire productive assets | $ 1,500,000 | ||||||
Cash- DMYT trust and cash, net of redemptions | 700,000 | ||||||
Assumed outstanding liabilities | 500,000 | ||||||
Asset acquisition, legal fees | 400,000 | ||||||
Asset acquisition, capitalized amount | 4,200,000 | $ 4,700,000 | |||||
Acquisition fees | 400,000 | ||||||
Rush Street Productions, LLC | Trademark Asset | |||||||
Accounting Policies [Line Items] | |||||||
Capitalized trademark intangible asset | $ 5,100,000 | ||||||
Class A Common Stock | |||||||
Accounting Policies [Line Items] | |||||||
Common stock, par value (in USD per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||
Class A Common Stock | Private Warrant Holder | |||||||
Accounting Policies [Line Items] | |||||||
Number of shares issuable per warrant (in shares) | shares | 1 | ||||||
Fair value per share (in USD per share) | $ / shares | $ 11.50 | ||||||
Class A Common Stock | Special Limited Partner | |||||||
Accounting Policies [Line Items] | |||||||
Common stock, par value (in USD per share) | $ / shares | $ 0.0001 | ||||||
Class A Common Stock | IPO | dMy Technology Group, Inc. | |||||||
Accounting Policies [Line Items] | |||||||
Conversion ratio | 1 | ||||||
Class A Common Stock | ROI Assets | |||||||
Accounting Policies [Line Items] | |||||||
Asset acquisition, shares transferred (in shares) | shares | 158,127 | ||||||
Asset acquisition, value of shares transferred | $ 2,500,000 | ||||||
Class A Common Stock | Rush Street Productions, LLC | |||||||
Accounting Policies [Line Items] | |||||||
Asset acquisition, number of shares issued (in shares) | shares | 60,000 | ||||||
Asset acquisition, shares issued, value | $ 300,000 | ||||||
Warrant | Private Placement | dMy Technology Group, Inc. | |||||||
Accounting Policies [Line Items] | |||||||
Number of units issued (in shares) | shares | 75,000 | ||||||
Class V Common Stock | |||||||
Accounting Policies [Line Items] | |||||||
Common stock, par value (in USD per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||
Class V Common Stock | Special Limited Partner | |||||||
Accounting Policies [Line Items] | |||||||
Common stock, par value (in USD per share) | $ / shares | $ 0.0001 | ||||||
Class V Common Stock | Rush Street Productions, LLC | |||||||
Accounting Policies [Line Items] | |||||||
Asset acquisition, shares issued, value | $ 2,400,000 | ||||||
RSILP Units | Rush Street Productions, LLC | |||||||
Accounting Policies [Line Items] | |||||||
Asset acquisition, number of shares issued (in shares) | shares | 480,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Property, Plant and Equipment (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 168,330,000 | $ 179,723,000 | ||
Restricted cash | 2,647,000 | 26,358,000 | ||
Total cash, cash equivalents and restricted cash | 170,977,000 | 206,081,000 | $ 300,329,000 | $ 262,065,000 |
Cash equivalents | 78,400,000 | 1,000,000 | ||
Money market funds | $ 68,700,000 | $ 0 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Property and Equipment, net (Details) | Dec. 31, 2023 |
Computer Equipment | Minimum | |
Property and equipment, net | |
Useful life of assets | 3 years |
Computer Equipment | Maximum | |
Property and equipment, net | |
Useful life of assets | 5 years |
Furniture and fixtures | |
Property and equipment, net | |
Useful life of assets | 4 years |
Leasehold improvements | Minimum | |
Property and equipment, net | |
Useful life of assets | 1 year |
Leasehold improvements | Maximum | |
Property and equipment, net | |
Useful life of assets | 10 years |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 691,161 | $ 592,212 | $ 488,105 |
Online casino and online sports betting | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 674,059 | 576,573 | 480,065 |
Retail sports betting | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 12,848 | 11,713 | 3,828 |
Social gaming | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 4,254 | $ 3,926 | $ 4,212 |
Revenue Recognition - Revenue b
Revenue Recognition - Revenue by Geographic Region (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 691,161 | $ 592,212 | $ 488,105 |
United States And Canada | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 611,868 | 539,887 | 452,607 |
Latin America And Mexico | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 79,293 | $ 52,325 | $ 35,498 |
Revenue Recognition - Deferred
Revenue Recognition - Deferred Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |||
Deferred revenue, beginning of period | $ 7,840 | $ 4,637 | $ 1,797 |
Deferred revenue, end of period | 7,013 | 7,840 | 4,637 |
Revenue recognized in the year from amounts included in deferred revenue at the beginning of the year | $ 7,840 | $ 4,637 | $ 1,797 |
Intangible Assets, Net - Schedu
Intangible Assets, Net - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | |||
Total | $ 74,874 | $ 69,025 | |
Amortization of license expense | $ 24,700 | $ 11,600 | $ 3,000 |
License Fees | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Remaining Amortization Period (years) | 7 years 9 months | 8 years 5 months 8 days | |
Gross Carrying Amount | $ 61,015 | $ 54,334 | |
Accumulated Amortization | (25,946) | (12,363) | |
Total | $ 35,069 | $ 41,971 | |
Internally Developed Software | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Remaining Amortization Period (years) | 2 years 4 months 13 days | 2 years 6 months 3 days | |
Gross Carrying Amount | $ 43,868 | $ 20,860 | |
Accumulated Amortization | (12,601) | (3,490) | |
Total | $ 31,267 | $ 17,370 | |
Developed Technology | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Remaining Amortization Period (years) | 6 years | 7 years | |
Gross Carrying Amount | $ 5,931 | $ 5,931 | |
Accumulated Amortization | (1,483) | (741) | |
Total | $ 4,448 | $ 5,190 | |
Trademark Asset | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Remaining Amortization Period (years) | 3 years 5 months 1 day | 4 years 5 months 1 day | |
Gross Carrying Amount | $ 5,088 | $ 5,088 | |
Accumulated Amortization | (1,611) | (594) | |
Total | $ 3,477 | 4,494 | |
Content | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Remaining Amortization Period (years) | 1 year 7 months 6 days | ||
Gross Carrying Amount | $ 785 | 0 | |
Accumulated Amortization | (172) | 0 | |
Total | $ 613 | $ 0 |
Intangible Assets, Net - Estima
Intangible Assets, Net - Estimated future amortization (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
2024 | $ 21,426 | |
2025 | 18,126 | |
2026 | 11,818 | |
2027 | 6,141 | |
2028 | 4,888 | |
Thereafter | 12,475 | |
Total | $ 74,874 | $ 69,025 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property and Equipment | |||
Total property and equipment | $ 12,235 | $ 10,716 | |
Less: accumulated depreciation | (7,641) | (3,818) | |
Property, plant and equipment, net | 4,594 | 6,898 | |
Finance lease right-of-use assets | 5,519 | 3,112 | |
Less: accumulated amortization | (1,502) | (246) | |
Total finance lease right-of-use asset | 4,017 | 2,866 | |
Property and equipment, net | 8,611 | 9,764 | |
Depreciation expense | 3,800 | 2,100 | $ 1,000 |
Amortization of finance lease right-of-use asset | 1,272 | 578 | $ 228 |
Computers, software and related equipment | |||
Property and Equipment | |||
Total property and equipment | 5,541 | 4,050 | |
Operating equipment and servers | |||
Property and Equipment | |||
Total property and equipment | 4,779 | 4,610 | |
Furniture and fixtures | |||
Property and Equipment | |||
Total property and equipment | 647 | 600 | |
Leasehold improvements | |||
Property and Equipment | |||
Total property and equipment | 658 | 640 | |
Property and equipment not yet placed into service | |||
Property and Equipment | |||
Total property and equipment | $ 610 | $ 816 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Payables and Accruals [Abstract] | ||
Accrued compensation and related expenses | $ 13,896 | $ 10,077 |
Accrued operating expenses | 21,748 | 24,256 |
Accrued marketing expenses | 9,319 | 27,315 |
Accrued administrative expenses | 5,506 | 1,622 |
Other | 843 | 1,633 |
Total accrued expenses | 51,312 | 64,903 |
Income tax payable | $ 8,100 | $ 4,300 |
Warrant Liabilities - Narrative
Warrant Liabilities - Narrative (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Mar. 26, 2021 USD ($) shares | Jan. 13, 2021 shares | Dec. 29, 2020 $ / shares shares | Mar. 26, 2021 USD ($) | Dec. 31, 2023 USD ($) shares | Dec. 31, 2022 USD ($) shares | Dec. 31, 2021 USD ($) shares | Mar. 31, 2021 USD ($) | Feb. 22, 2021 $ / shares shares | Dec. 31, 2020 USD ($) | |
Class of Warrant or Right [Line Items] | ||||||||||
Conversion ratio | 0.5 | |||||||||
Fair value of private warrants | $ | $ 0 | $ 0 | $ 0 | $ 170,109 | ||||||
Change in fair value of warrant liabilities | $ | $ 41,800 | $ 0 | $ 0 | $ 41,802 | ||||||
Class A Common Stock | ||||||||||
Class of Warrant or Right [Line Items] | ||||||||||
Shares issued during period (in shares) | 2,571,808 | 1,212,813 | 11,442,389 | |||||||
Class A Common Stock | Public Warrant Holder | ||||||||||
Class of Warrant or Right [Line Items] | ||||||||||
Number of shares issuable per warrant (in shares) | 1 | 11,500,000 | ||||||||
Fair value per share (in USD per share) | $ / shares | $ 11.50 | $ 11.50 | ||||||||
Class A Common Stock | Private Warrant Holder | ||||||||||
Class of Warrant or Right [Line Items] | ||||||||||
Number of shares issuable per warrant (in shares) | 1 | |||||||||
Fair value per share (in USD per share) | $ / shares | $ 11.50 | |||||||||
Public Warrants | ||||||||||
Class of Warrant or Right [Line Items] | ||||||||||
Warrants exercised (in shares) | 11,442,389 | |||||||||
Cash proceeds from warrants exercised | $ | $ 131,600 | |||||||||
Warrants outstanding (in shares) | 0 | 0 | 11,500,000 | |||||||
Public Warrants | Fair Value, Inputs, Level 1 | ||||||||||
Class of Warrant or Right [Line Items] | ||||||||||
Fair value of private warrants | $ | $ 0 | $ 77,500 | 88,079 | |||||||
Change in fair value of warrant liabilities | $ | $ 10,570 | |||||||||
Private Warrants | ||||||||||
Class of Warrant or Right [Line Items] | ||||||||||
Warrants outstanding (in shares) | 0 | 0 | 6,675,000 | |||||||
Warrants outstanding, term | 5 years | |||||||||
Private Warrants | Fair Value, Inputs, Level 3 | ||||||||||
Class of Warrant or Right [Line Items] | ||||||||||
Fair value of private warrants | $ | $ 50,800 | $ 50,800 | $ 0 | $ 82,030 | ||||||
Change in fair value of warrant liabilities | $ | $ 31,232 | |||||||||
IPO | dMy Technology Group, Inc. | ||||||||||
Class of Warrant or Right [Line Items] | ||||||||||
Number of units issued (in shares) | 23,000,000 | |||||||||
Price per unit (in USD per share) | $ / shares | $ 10 | |||||||||
IPO | dMy Technology Group, Inc. | Class A Common Stock | ||||||||||
Class of Warrant or Right [Line Items] | ||||||||||
Conversion ratio | 1 | |||||||||
IPO | Public Warrants | ||||||||||
Class of Warrant or Right [Line Items] | ||||||||||
Number of shares issuable per warrant (in shares) | 1 | |||||||||
Private Placement | dMy Technology Group, Inc. | Warrant | ||||||||||
Class of Warrant or Right [Line Items] | ||||||||||
Number of units issued (in shares) | 75,000 | |||||||||
Private Placement | Private Warrants | dMy Technology Group, Inc. | ||||||||||
Class of Warrant or Right [Line Items] | ||||||||||
Number of units issued (in shares) | 6,600,000 |
Warrant Liabilities - Schedule
Warrant Liabilities - Schedule of Level 3 Inputs (Details - Fair Value, Inputs, Level 3 - Private Warrants | Mar. 26, 2021 $ / shares yr | Dec. 31, 2020 yr $ / shares |
Exercise price (in usd per share) | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 11.50 | 11.50 |
Stock price (in usd per share) | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 15.96 | 22.76 |
Volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.426 | 0.414 |
Term (years) | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | yr | 4.77 | 5 |
Risk-free interest rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Measurement input | 0.0076 | 0.0037 |
Warrant Liabilities - Schedul_2
Warrant Liabilities - Schedule Of Warrant Liabilities, Activity (Details - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 26, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Class of Warrant or Right [Line Items] | ||||
Fair value of warrants at beginning of period | $ 170,109 | $ 0 | $ 0 | $ 170,109 |
Change in fair value of warrant liability | (41,800) | 0 | 0 | (41,802) |
Fair value of warrants at redemption | (128,307) | |||
Fair value of warrants at end of period | $ 0 | 0 | 0 | |
Public Warrants | Fair Value, Inputs, Level 1 | ||||
Class of Warrant or Right [Line Items] | ||||
Fair value of warrants at beginning of period | 88,079 | 0 | 88,079 | |
Change in fair value of warrant liability | (10,570) | |||
Fair value of warrants at redemption | (77,509) | |||
Fair value of warrants at end of period | 0 | |||
Private Warrants | Fair Value, Inputs, Level 3 | ||||
Class of Warrant or Right [Line Items] | ||||
Fair value of warrants at beginning of period | 82,030 | $ 0 | 82,030 | |
Change in fair value of warrant liability | (31,232) | |||
Fair value of warrants at redemption | (50,798) | |||
Fair value of warrants at end of period | $ 50,800 | $ 0 |
Earnout Interests Liability - N
Earnout Interests Liability - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||
Mar. 26, 2021 | Jan. 13, 2021 | Dec. 29, 2020 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Earnout Interests Liability [Line items] | ||||||
VWAP exceeded by company (in USD per share) | $ 14 | |||||
Number of trading days to calculate VWAPs | 10 days | |||||
Number of consecutive trading days to calculate VWAPs | 20 days | |||||
Change in fair value of earnout interests liability | $ 0 | $ 0 | $ 13,740 | |||
Class A Common Stock | ||||||
Earnout Interests Liability [Line items] | ||||||
Common stock, outstanding prior to Business Combination (in shares) | 72,387,409 | 65,111,616 | ||||
Shares issued during period (in shares) | 2,571,808 | 1,212,813 | 11,442,389 | |||
Class A Common Stock | RSILP | Founder Holders | ||||||
Earnout Interests Liability [Line items] | ||||||
Common stock, outstanding prior to Business Combination (in shares) | 1,212,813 | |||||
Class V Common Stock | ||||||
Earnout Interests Liability [Line items] | ||||||
Common stock, outstanding prior to Business Combination (in shares) | 150,434,310 | 155,955,584 | ||||
Shares issued during period (in shares) | 15,000,000 | |||||
Class V Common Stock | RSILP | RSILP | ||||||
Earnout Interests Liability [Line items] | ||||||
Number of units issued (in shares) | 15,000,000 | |||||
RSILP Units | RSILP | ||||||
Earnout Interests Liability [Line items] | ||||||
Number of units issued (in shares) | 1,212,813 | |||||
Shares retained (in shares) | 15,000,000 |
Earnout Interests Liability - F
Earnout Interests Liability - Fair Value Measurement Inputs and Valuation Techniques (Details) $ in Thousands | Dec. 31, 2020 USD ($) Y $ / shares |
Earnout Interests Liability [Line items] | |
Earnout interests liability, fair value | $ | $ 351,048 |
Fair Value, Inputs, Level 3 | Volatility | |
Earnout Interests Liability [Line items] | |
Measurement input | 0.546 |
Fair Value, Inputs, Level 3 | Term (years) | |
Earnout Interests Liability [Line items] | |
Measurement input | Y | 2.99 |
Fair Value, Inputs, Level 3 | Risk-free interest rate | |
Earnout Interests Liability [Line items] | |
Measurement input | 0.0017 |
Fair Value, Inputs, Level 3 | Stock price (in usd per share) | Minimum | |
Earnout Interests Liability [Line items] | |
Measurement input | 21.51 |
Fair Value, Inputs, Level 3 | Stock price (in usd per share) | Maximum | |
Earnout Interests Liability [Line items] | |
Measurement input | 21.65 |
Earnout Interests Liability - S
Earnout Interests Liability - Schedule Of Earnout Interests Liability, Activity (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Earnout Interests Liability [Abstract] | |||
Earnout interests liability at beginning of period | $ 0 | $ 351,048 | |
Change in fair value of earnout interests liability | $ 0 | $ 0 | 13,740 |
Settlement of earnout interests liability | (364,788) | ||
Earnout interests liability at end of period | $ 0 |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) | 12 Months Ended | ||
Dec. 31, 2023 USD ($) vote $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2022 shares | |
Debt and Equity Securities, FV-NI [Line Items] | |||
Capital stock authorized (in shares) | 951,000,000 | ||
Preferred stock, par value (in USD per share) | $ / shares | $ 0.0001 | ||
Number of votes per share | vote | 1 | ||
Owners Other Than Rush Street Interactive | RSILP | |||
Debt and Equity Securities, FV-NI [Line Items] | |||
Percentage of common units retained by sellers | 67.51% | 72.20% | 70.55% |
Preferred Stock | |||
Debt and Equity Securities, FV-NI [Line Items] | |||
Capital stock authorized (in shares) | 1,000,000 | ||
Preferred stock outstanding (in shares) | 0 | 0 | |
Class A Common Stock | |||
Debt and Equity Securities, FV-NI [Line Items] | |||
Capital stock authorized (in shares) | 750,000,000 | ||
Common stock, shares outstanding (in shares) | 72,387,409 | 65,111,616 | |
Treasury stock repurchased (in shares) | 218,589 | ||
Average price of treasury stock repurchased (in USD per share) | $ / shares | $ 15.85 | ||
Total cost of treasury stock repurchased | $ | $ 3,500,000 | ||
Class V Common Stock | |||
Debt and Equity Securities, FV-NI [Line Items] | |||
Capital stock authorized (in shares) | 200,000,000 | ||
Common stock, shares outstanding (in shares) | 150,434,310 | 155,955,584 | |
Consideration for cancelled shares | $ | $ 0 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Noncontrolling Interests (Details) - RSILP - Owners Other Than Rush Street Interactive | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Noncontrolling Interest [Roll Forward] | ||
Non-controlling interest percentage at beginning of period | 70.55% | 72.20% |
Issuance of Class A Common Stock upon RSILP Unit Exchanges | (0.0249) | (0.0146) |
Issuance of Class A Common Stock in connection with the vesting of certain share-based equity grants | (0.0055) | (0.0023) |
Non-controlling interest percentage at end of period | 67.51% | 70.55% |
Class A Common Stock | ||
Noncontrolling Interest [Roll Forward] | ||
Issuance of common stock as purchase consideration | (0.0002) | |
Class V Common Stock | ||
Noncontrolling Interest [Roll Forward] | ||
Issuance of common stock as purchase consideration | 0.0006 |
Share-Based Compensation - Narr
Share-Based Compensation - Narrative (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Share-Based Compensation | ||
Number of awards granted (in shares) | 1,084,445 | 790,339 |
Weighted average grant price of options granted (in USD per share) | $ 3.28 | $ 4.07 |
Aggregate fair value of options granted | $ 2,300,000 | $ 1,800,000 |
Intrinsic value of options outstanding | 1,600,000 | |
Intrinsic value of options exercisable | $ 100,000 | |
RSUs | ||
Share-Based Compensation | ||
Number of units granted (in shares) | 4,030,535 | 5,542,010 |
Aggregate fair value of units granted | $ 16,600,000 | $ 23,100,000 |
Weighted average grant date fair value of units vested | 19,300,000 | $ 15,000,000 |
Unrecognized stock-based compensation expense | $ 37,800,000 | |
Weighted-average vesting period of unrecognized stock-based compensation expense | 1 year | |
Fair value per share (in USD per share) | $ 3.28 | $ 3.95 |
Dividend yield | 0% | 0% |
Restricted Stock Units, Service Conditions | ||
Share-Based Compensation | ||
Number of units granted (in shares) | 2,500,000 | 3,900,000 |
Restricted Stock Units, Service Conditions | Minimum | ||
Share-Based Compensation | ||
Vesting period | 3 years | |
Restricted Stock Units, Service Conditions | Maximum | ||
Share-Based Compensation | ||
Vesting period | 4 years | |
Restricted Stock Units, Market Conditions | ||
Share-Based Compensation | ||
Number of units granted (in shares) | 1,500,000 | 1,600,000 |
Vesting period | 3 years | 3 years |
Stock options | ||
Share-Based Compensation | ||
Weighted average grant price of options granted (in USD per share) | $ 2.14 | $ 2.26 |
Unrecognized stock-based compensation expense | $ 2,800,000 | |
Weighted-average vesting period of unrecognized stock-based compensation expense | 10 months 24 days | |
Fair value per share (in USD per share) | $ 3.28 | $ 4.07 |
Dividend yield | 0% | 0% |
Class A Common Stock | ||
Share-Based Compensation | ||
Aggregate number of shares reserved under the plan (in shares) | 35,800,000 | |
Common Stock, Increase (Decrease) to Capital Shares Reserved for Future Issuance | 22,400,000 |
Share-Based Compensation - Valu
Share-Based Compensation - Valuation Assumptions (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
RSUs | ||
Share-Based Compensation | ||
Volatility rate | 69.78% | |
Risk-free interest rate | 3.85% | |
Average expected life (in years) | 2 years 9 months 18 days | 2 years 3 months 18 days |
Dividend yield | 0% | 0% |
Stock price at grant date (in USD per share) | $ 3.28 | $ 3.95 |
RSUs | Minimum | ||
Share-Based Compensation | ||
Volatility rate | 70.93% | |
Risk-free interest rate | 4.32% | |
Average expected life (in years) | 3 years | |
RSUs | Maximum | ||
Share-Based Compensation | ||
Volatility rate | 71% | |
Risk-free interest rate | 4.39% | |
Stock options | ||
Share-Based Compensation | ||
Volatility rate | 70% | 58.98% |
Risk-free interest rate | 3.80% | 3.68% |
Average expected life (in years) | 6 years | 5 years 7 months 6 days |
Dividend yield | 0% | 0% |
Stock price at grant date (in USD per share) | $ 3.28 | $ 4.07 |
Exercise price (in USD per share) | $ 3.28 | $ 4.07 |
Share-Based Compensation - RSU
Share-Based Compensation - RSU and Stock Option Activity (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding [Roll Forward] | ||
Unvested options outstanding at beginning of period (in shares) | 887,166 | 96,827 |
Number of awards granted (in shares) | 1,084,445 | 790,339 |
Options vested (in shares) | 0 | 0 |
Options forfeited (in shares) | 0 | 0 |
Unvested options outstanding at end of period (in shares) | 1,971,611 | 887,166 |
Exercisable balance (in shares) | 328,002 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||
Weighted average grant price of options outstanding at beginning of period (in USD per share) | $ 5.31 | $ 15.40 |
Weighted average grant price of options granted (in USD per share) | 3.28 | 4.07 |
Weighted average grant price of options vested (in USD per share) | 0 | 0 |
Weighted average grant price of options forfeited (in USD per share) | 0 | 0 |
Weighted average grant price of options outstanding at end of period (in USD per share) | 4.19 | $ 5.31 |
Weighted average grant price of options exercisable (in USD per share) | $ 6.30 | |
Vested RSUs | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||
Vested RSUs (in shares) | 1,104,629 | 636,917 |
RSUs | ||
Number of Units | ||
Unvested balance at beginning of period (in shares) | 7,492,613 | 3,076,158 |
Number of units granted (in shares) | 4,030,535 | 5,542,010 |
Vested (in shares) | (2,221,870) | (1,020,874) |
Units forfeited (in shares) | (83,136) | (104,681) |
Unvested balance at end of period (in shares) | 9,218,142 | 7,492,613 |
Weighted average grant price | ||
Weighted average grant price of unvested units outstanding at beginning of period (in USD per shares) | $ 7.48 | $ 16.08 |
Weighted average grant price of units granted (in USD per shares) | 4.12 | 4.17 |
Weighted average grant price of units vested (in USD per shares) | 8.71 | 14.67 |
Weighted average grant price of units forfeited (in USD per shares) | 9.52 | 14.36 |
Weighted average grant price of unvested units outstanding at end of period (in USD per shares) | $ 5.70 | $ 7.48 |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||
Vested RSUs (in shares) | 467,712 | 253,787 |
Stock options | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||
Weighted average grant price of options granted (in USD per share) | $ 2.14 | $ 2.26 |
Share-Based Compensation - Shar
Share-Based Compensation - Share-based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total share-based compensation expense | $ 30,020 | $ 18,691 | $ 24,912 |
Costs of revenue | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total share-based compensation expense | 1,064 | 987 | 1,808 |
Advertising and promotions | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total share-based compensation expense | 2,225 | 2,048 | 3,605 |
General and administrative | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total share-based compensation expense | $ 26,731 | $ 15,656 | $ 19,499 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Millions | Dec. 29, 2020 | Dec. 31, 2023 | Dec. 31, 2022 |
Income Tax [Line Items] | |||
Unrecognized tax receivable liability | $ 63.7 | $ 58.7 | |
Special Limited Partner | |||
Income Tax [Line Items] | |||
Tax receivable agreement, percentage of net certain tax benefits payable | 85% | ||
Domestic Tax Authority | |||
Income Tax [Line Items] | |||
Net operating loss carryovers | 94.5 | 73.3 | |
State and Local Jurisdiction | |||
Income Tax [Line Items] | |||
Net operating loss carryovers | 83.4 | 69.4 | |
Foreign Tax Authority | |||
Income Tax [Line Items] | |||
Net operating loss carryovers | $ 15.2 | $ 30.9 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Current income taxes: | |||
Federal | $ (188) | $ (118) | $ 149 |
State and local | 9 | (34) | 25 |
Foreign | 11,602 | 9,137 | 4,551 |
Total current income taxes | 11,423 | 8,985 | 4,725 |
Deferred income taxes: | |||
Federal | 0 | 0 | 0 |
State and local | 0 | 0 | 0 |
Foreign | (214) | (24) | (37) |
Deferred income tax | (214) | (24) | (37) |
Income tax expense | $ 11,209 | $ 8,961 | $ 4,688 |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | |||
Net loss before income taxes | $ (48,846) | $ (125,371) | $ (66,404) |
Less: net loss before income taxes attributable to non-controlling interest | (33,820) | (89,224) | (48,258) |
Net loss attributable to Rush Street Interactive Inc. before income taxes | (15,026) | (36,147) | (18,146) |
Income tax benefit at the federal statutory rate | (3,155) | (7,591) | (3,811) |
State income taxes, net of federal benefit | (46) | (34) | 25 |
Nondeductible stock compensation | 1,351 | 0 | 0 |
Foreign operations | 11,387 | 9,113 | 4,514 |
Change in valuation allowance | 2,589 | 8,025 | 4,027 |
Other | (917) | (552) | (67) |
Income tax expense | $ 11,209 | $ 8,961 | $ 4,688 |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax assets: | ||
Investment in subsidiaries | $ 134,283 | $ 134,586 |
Net operating losses | 29,724 | 26,394 |
Imputed interest | 2,120 | 1,638 |
Share-based compensation | 1,160 | 366 |
Other assets | 422 | 165 |
Total gross deferred tax assets | 167,709 | 163,149 |
Valuation allowance | (167,305) | (163,029) |
Total deferred tax assets, net of valuation allowance | 404 | 120 |
Deferred tax liabilities: | ||
Investment in subsidiaries | 0 | 0 |
Total gross deferred tax liabilities | 0 | 0 |
Net deferred tax assets | $ 404 | $ 120 |
Loss Per Share - Schedule of Ba
Loss Per Share - Schedule of Basic and Diluted Earnings (Loss) per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Numerator: | |||
Net loss | $ (60,055) | $ (134,332) | $ (71,092) |
Less: Net loss attributable to non-controlling interests | (41,750) | (95,701) | (51,603) |
Net loss attributable to Rush Street Interactive, Inc. – basic | (18,305) | (38,631) | (19,489) |
Effect of dilutive securities: | |||
Public, Private Placement and Working Capital Warrants, net of amounts attributable to non-controlling interests | 0 | 0 | (9,569) |
Net loss attributable to Rush Street Interactive, Inc. – diluted | $ (18,305) | $ (38,631) | $ (29,058) |
Denominator | |||
Weighted average common shares outstanding - basic (in shares) | 68,508,093 | 63,532,906 | 56,265,541 |
Weighted average effect of dilutive securities: | |||
Public Warrants (in shares) | 0 | 0 | 677,746 |
Private Placement and Working Capital Warrants (in shares) | 0 | 0 | 483,598 |
Weighted average common shares outstanding - diluted (in shares) | 68,508,093 | 63,532,906 | 57,426,885 |
Net earnings (loss) per class A common share - basic (in USD per share) | $ (0.27) | $ (0.61) | $ (0.35) |
Net loss per class A common share - dilluted (in USD per share) | $ (0.27) | $ (0.61) | $ (0.51) |
Loss Per Share - Schedule of An
Loss Per Share - Schedule of Anti-dilutive Securities (Details) - shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
RSILP Units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from computation of diluted shares outstanding (in shares) | 150,434,310 | 155,955,584 | 158,702,329 |
Unvested RSUs | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from computation of diluted shares outstanding (in shares) | 9,218,142 | 7,492,613 | 3,076,158 |
Vested RSUs | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from computation of diluted shares outstanding (in shares) | 1,104,629 | 636,917 | 383,130 |
Outstanding Stock Options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from computation of diluted shares outstanding (in shares) | 1,971,611 | 887,166 | 96,827 |
Related Parties (Details)
Related Parties (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Jun. 10, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 28, 2020 | |
Rush Street Productions, LLC | |||||
Related Party Transaction [Line Items] | |||||
Asset acquisition, capitalized amount | $ 4.2 | $ 4.7 | |||
RSG | Service Agreements | |||||
Related Party Transaction [Line Items] | |||||
Expenses relating to related party | $ 1.1 | ||||
Affiliated Land-Based Casinos | Royalty Agreements | |||||
Related Party Transaction [Line Items] | |||||
Expenses relating to related party | 49.6 | $ 39.8 | $ 41.6 | ||
Due from affiliates | $ 33.5 | $ 35.9 | |||
Class V Common Stock | |||||
Related Party Transaction [Line Items] | |||||
Shares issued upon conversion | 1 | ||||
Class A Common Stock | |||||
Related Party Transaction [Line Items] | |||||
Shares issued upon conversion | 1 | ||||
Sellers' Representative | RSILP Units | |||||
Related Party Transaction [Line Items] | |||||
Minimum number of units available to be exchanged | 1,000 | ||||
RSG | Service Agreements | The Company | |||||
Related Party Transaction [Line Items] | |||||
Term of the agreement | 2 years | ||||
RSILP | Bluhm and Trust | |||||
Related Party Transaction [Line Items] | |||||
Noncontrolling ownership interest | 73% | ||||
RSILP | Carlin and Trust | |||||
Related Party Transaction [Line Items] | |||||
Noncontrolling ownership interest | 20% | ||||
RSILP | Sellers' Representative | |||||
Related Party Transaction [Line Items] | |||||
Noncontrolling ownership interest | 1% |
Leases (Details)
Leases (Details) | Dec. 31, 2023 |
Maximum | Office Space | |
Lessor, Lease, Description [Line Items] | |
Operating lease term | 5 years |
Leases - Lease, Cost (Details)
Leases - Lease, Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | |||
Operating lease cost | $ 770 | $ 676 | $ 268 |
Variable lease cost | 267 | 275 | 528 |
Short-term lease cost | 867 | 436 | 179 |
Amortization of finance lease right-of-use asset | 1,272 | 578 | 228 |
Interest on finance lease liabilities | 85 | 22 | 27 |
Total lease expenses | $ 3,261 | $ 1,987 | $ 1,230 |
Leases - Other Information (Det
Leases - Other Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | |||
Operating cash flows from operating leases | $ 732 | $ 653 | $ 355 |
Right-of-use assets obtained in exchange for new or modified operating lease liabilities | 210 | 965 | 810 |
Right-of-use assets obtained in exchange for new or modified finance lease liabilities | $ 2,423 | $ 1,124 | $ 2,547 |
Weighted-average remaining lease term (in years) – operating leases | 2 years 6 months | 3 years 1 month 6 days | 3 years 2 months 12 days |
Weighted-average remaining lease term (in years) – finance leases | 3 years 4 months 24 days | 3 years | 4 years 7 months 6 days |
Weighted-average discount rate – operating leases | 6.70% | 6.20% | 6% |
Weighted-average discount rate – finance leases | 7.70% | 6% | 6% |
Leases - Operating Lease, Liabi
Leases - Operating Lease, Liability, Maturity (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Leases [Abstract] | |
2024 | $ 686 |
2025 | 392 |
2026 | 214 |
2027 | 125 |
2028 | 0 |
Total undiscounted future cash flows | 1,417 |
Less: present value discount | (123) |
Operating lease liabilities | $ 1,294 |
Leases - Finance Lease, Liabili
Leases - Finance Lease, Liability, Maturity (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Leases [Abstract] | |
2024 | $ 873 |
2025 | 873 |
2026 | 318 |
2027 | 230 |
2028 | 214 |
Total undiscounted future cash flows | 2,508 |
Less: present value discount | (291) |
Finance lease liabilities | $ 2,217 |
Finance Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Other current liabilities |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other non-current liabilities |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Contractual Obligation, Fiscal Year Maturity [Abstract] | |
2024 | $ 13,653 |
2025 | 7,880 |
2026 | 5,565 |
2027 | 5,165 |
2028 | 4,728 |
Thereafter | 26,975 |
Total | 63,966 |
Non-cancelable Lease Contract | |
Contractual Obligation, Fiscal Year Maturity [Abstract] | |
Operating and finance lease obligations | 6,000 |
Non-cancelable Lease Contract with Marketing Vendors | |
Contractual Obligation, Fiscal Year Maturity [Abstract] | |
Operating and finance lease obligations | 11,100 |
License and Market Access Commitments | |
Contractual Obligation, Fiscal Year Maturity [Abstract] | |
Operating and finance lease obligations | $ 46,900 |