Genius Sports Limited (NYSE:GENI) (“Genius Sports” or the “Group”), the official data, technology and broadcast partner that powers the global ecosystem connecting sports, betting and media, today announced financial results for its fiscal third quarter ended September 30, 2022
LONDON & NEW YORK--(BUSINESS WIRE)--Nov 10, 2022--
Genius Sports Limited (NYSE:GENI) (“Genius Sports” or the “Group”), the official data, technology and broadcast partner that powers the global ecosystem connecting sports, betting and media, today announced financial results for its fiscal third quarter ended September 30, 2022.
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“We are pleased to deliver another quarter of growth and Group Adj. EBITDA profitability, and we remain on target to achieve our full-year goals set on our Investor Day at the start of 2022,” said Mark Locke, Genius Sports Co-Founder and CEO. “This year has been characterized by strong execution as we continue to deploy innovative technology, win new customers, and strengthen our key partnerships across the sports, betting, media, and broadcasting ecosystem, all with an eye towards cost discipline and profitable growth.”
Betting Technology, Content & Services
Media Technology, Content & Services
Sports Technology & Services
Group Adjusted EBITDA Margin
Betting Technology, Content & Services
Media Technology, Content & Services
Sports Technology & Services
Group Adjusted EBITDA Margin
Q3 2022 Financial Highlights
Group Net Loss: Group net loss was $9.0 million in the quarter. This represents an 87% year-over-year improvement, driven primarily by a reduction in stock-based compensation, gain on foreign currency, and improved profitability compared to the third quarter ended September 30, 2021.
Group Adjusted EBITDA: Group Adjusted (non-GAAP) EBITDA was $7.7 million in the quarter, or $8.7 million at the guidance exchange rate 1 vs. $9.0 million guidance. This represents a significant improvement compared to the $0.4 million loss in the third quarter ended September 30, 2021. This was driven by meaningful revenue growth, disciplined cost control, and overall revenue mix.
Strong Cash Position: Closing cash balance was approximately $150 million for the fiscal third quarter ended September 30, 2022, including a $10 million adverse impact from the effect of exchange rate changes in the third quarter. This closing cash balance includes approximately $33 million of restricted cash related to a guarantee for rights. As noted last quarter, this amount of restricted cash will reduce over time and return to the cash and cash equivalents line on the balance sheet. The Company expects a total closing cash and restricted cash balance in the range of $140 to $150 million at the end of the 2022 fiscal year, based on exchange rates as of September 30, 2022.
1 Guidance exchange rate assumes comparable GBP:USD exchange rate of 1.35 at time of initial forecast in January 2022
Q3 2022 Business Highlights
After the third quarter reporting period
Genius reaffirms its expectation to generate Group Revenue of approximately $340 million and Group Adjusted EBITDA of approximately $15 million in 2022, despite risks related to foreign exchange rates. The Company also expects Group Revenue in the range of $430 to $440 million and Group Adjusted EBITDA of $40 to $50 million in 2023, assuming the guidance exchange rate 1.
1 Guidance exchange rate assumes comparable GBP:USD exchange rate of 1.35 at time of initial forecast in January 2022
Financial Statements & Reconciliation Tables
Condensed Consolidated Statements of Operations
(Amounts in thousands, except share and per share data)
General and administrative
Loss on disposal of assets
Gain on fair value remeasurement of contingent consideration
Change in fair value of derivative warrant liabilities
Total other (expense) income
Income tax (expense) benefit
Gain from equity method investment
Preferred share accretion
Net loss attributable to common stockholders
Loss per share attributable to common stockholders:
Weighted average common stock outstanding:
Condensed Consolidated Balance Sheets
(Amounts in thousands, except share and per share data)
Cash and cash equivalents
Property and equipment, net
Restricted cash, non-current
LIABILITIES AND SHAREHOLDERS' EQUITY
Derivative warrant liabilities
Other current liabilities
Total current liabilities
Long-term debt – less current portion
Commitments and contingencies
Common stock, $0.01 par value, unlimited shares authorized, 201,361,536 shares issued and outstanding at September 30, 2022; unlimited shares authorized, 193,585,625 shares issued and outstanding at December 31, 2021
B Shares, $0.0001 par value, 22,500,000 shares authorized, 18,500,000 shares issued and outstanding at September 30, 2022 and December 31, 2021
Additional paid-in capital
Accumulated other comprehensive loss
Total shareholders' equity
Total liabilities and shareholders' equity
Condensed Consolidated Statements of Cash Flows
Cash Flows from operating activities:
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization
Loss on disposal of assets
Gain on fair value remeasurement of contingent consideration
Change in fair value of derivative warrant liabilities
Non-cash interest expense, net
Amortization of contract cost
Deferred income taxes (benefit)
Provision for doubtful accounts
Gain from equity method investment
Gain on foreign currency remeasurement
Changes in operating assets and liabilities
Effect of business combinations
Other current liabilities
Net cash used in operating activities
Cash flows from investing activities:
Purchases of property and equipment
Capitalization of internally developed software costs
Contribution to equity method investments
Equity investments without readily determinable fair values
Repayment of executive loan notes
Acquisition of business, net of cash acquired
Proceeds from disposal of assets
Net cash used in investing activities
Cash flows from financing activities:
Proceeds from merger with dMY Technology Group, Inc. II
dMY Technology Group, Inc. II transaction costs
Capitalization of Genius equity issuance costs
PIPE financing, net of equity issuance costs
Issuance of common stock in connection with additional equity offering, net of equity issuance costs
Preference shares payout and Incentive Securities Catch-Up Payment
Repayment of loans and mortgage
Proceeds from exercise of Public Warrants
Net cash provided by financing activities
Effect of exchange rate changes on cash, cash equivalents and restricted cash
Net increase (decrease) in cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash at beginning of period
Cash, cash equivalents and restricted cash at end of period
Supplemental disclosure of cash activities:
Cash paid during the period for interest
Cash paid during the period for income taxes
Supplemental disclosure of noncash investing and financing activities:
Promissory notes arising from equity method investments
Issuance of common stock in connection with business combinations
Preferred share accretion
Deferred offering costs included in other current assets and accrued expenses
Conversion of preference shares to common stock
Warrants acquired as part of merger with dMY Technology Group, Inc. II
Exercise of Private Placement Warrants
Reconciliation of U.S. GAAP Net loss to Adjusted EBITDA
Income tax expense (benefit)
Amortization of acquired intangibles (1)
Other depreciation and amortization (2)
Stock-based compensation (3)
Litigation and related costs (4)
Change in fair value of derivative warrant liabilities
Gain on fair value remeasurement of contingent consideration
Webcast and Conference Call Details
Genius Sports management will host a conference call and webcast today at 8:00AM EDT to discuss the Company’s third quarter results.
The conference call may be accessed by dialing (646) 307-1963.
A live audio webcast may be accessed on the Company’s investor relations website at investors.geniussports.com along with Genius’ earnings press release and related materials. A replay of the webcast will be available on the website within 24 hours after the call.
Genius Sports is the official data, technology and broadcast partner that powers the global ecosystem connecting sports, betting and media. Our technology is used in over 150 countries worldwide, creating highly immersive products that enrich fan experiences for the entire sports industry.
We are the trusted partner to over 400 sports organizations, including many of the world’s largest leagues and federations such as the NFL, EPL, FIBA, NCAA, NASCAR, AFA and Liga MX.
Genius Sports is uniquely positioned through cutting-edge technology, scale and global reach to support our partners. Our innovative use of big data, computer vision, machine learning, and augmented reality, connects the entire sports ecosystem from the rights holder all the way through to the fan.
Non-GAAP Financial Measures
This press release includes non-GAAP financial measures not presented in accordance with U.S. GAAP. A reconciliation of the most comparable GAAP measure to its non-GAAP measure is included above.
We present Group adjusted EBITDA and Group adjusted EBITDA margin, non-GAAP performance measures, to supplement our results presented in accordance with U.S. GAAP. Group adjusted EBITDA is defined as earnings before interest, income tax, depreciation and amortization and other items that are unusual or not related to our revenue-generating operations, including stock-based compensation expense (including related employer payroll taxes), change in fair value of derivative warrant liabilities and remeasurement of contingent consideration. Group adjusted EBITDA margin is calculated as Group adjusted EBITDA divided by Group revenue.
Group adjusted EBITDA and Group adjusted EBITDA margin are used by management to evaluate our core operating performance on a comparable basis and to make strategic decisions. We believe Group adjusted EBITDA and Group adjusted EBITDA margin are useful to investors for the same reasons as well as in evaluating our operating performance against competitors, which commonly disclose similar performance measures. However, our calculation of Group adjusted EBITDA and Group adjusted EBITDA margin may not be comparable to other similarly titled performance measures of other companies. Group adjusted EBITDA and Group adjusted EBITDA margin are not intended to be a substitute for any U.S. GAAP financial measure.
We do not provide a reconciliation of Group adjusted EBITDA to consolidated net income/(loss) on a forward-looking basis because we are unable to forecast certain items required to develop meaningful comparable GAAP financial measures without unreasonable efforts. These items are difficult to predict and estimate and are primarily dependent on future events. The impact of these items could be significant to our projections.
Certain income statement items in this press release are discussed on a constant currency basis. Our results between periods may not be comparable due to foreign currency translation effects. We present certain income statement items on a constant currency basis, as if GBP:USD exchange rate had remained constant period-over-period, to enhance the comparability of our results. We calculate income statement constant currency amounts by taking the relevant average GBP:USD exchange rate used in the preparation of our income statement for the more recent comparative period and apply it to the actual GBP amount used in the preparation of our income statement for the prior comparative period.
Constant currency amounts only adjust for the impact related to the translation of our consolidated financial statements from GBP to USD. Constant currency amounts do not adjust for any other translation effects, such as the translation of results of subsidiaries whose functional currency is other than GBP or USD.
Forward-Looking Statements
This press release contains forward-looking statements as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that involve significant risks and uncertainties. All statements other than statements of historical facts are forward-looking statements. These forward-looking statements include information about our possible or assumed future results of operations or our performance. Words such as “expects,” “intends,” “plans,” “believes,” “anticipates,” “estimates,” and variations of such words and similar expressions are intended to identify such forward looking statements. Although we believe that the forward-looking statements contained in this press release are based on reasonable assumptions, you should be aware that many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those in such forward-looking statements, including but not limited to: the effect of COVID-19 on our business, risks related to our reliance on relationships with sports organizations and the potential loss of such relationships or failure to renew or expand existing relationships; fraud, corruption or negligence related to sports events, or by our employees or contracted statisticians; risks related to changes in domestic and foreign laws and regulations or their interpretation; compliance with applicable data protection and privacy laws; pending litigation and investigations; the failure to protect or enforce our proprietary and intellectual property rights; claims for intellectual property infringement; our reliance on information technology; risks related to our ability to achieve the anticipated benefits from the business combination with dMY Technology Group, Inc. II; and other factors included under the heading “Risk Factors” in our Annual Report on Form 20-F filed with the SEC on March 18, 2022.
Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. We undertake no obligation to publicly update or revise any forward-looking statements contained herein, to reflect any change in our expectations with respect to such statements or any change in events, conditions or circumstances upon which any statement is based.
Chris Dougan, Chief Communications Officer
chris.dougan@geniussports.comInvestors
Brandon Bukstel, Investor Relations Manager
brandon.bukstel@geniussports.com
KEYWORD: NEW YORK EUROPE UNITED STATES UNITED KINGDOM NORTH AMERICA
INDUSTRY KEYWORD: GENERAL SPORTS SPORTS FINANCE GENERAL ENTERTAINMENT MOBILE ENTERTAINMENT PROFESSIONAL SERVICES CASINO/GAMING ENTERTAINMENT
SOURCE: Genius Sports Limited
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PUB: 11/10/2022 07:00 AM/DISC: 11/10/2022 07:02 AM
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