Genius further cuts down losses as 2022 revenue hits all targets

Genius Sports has reported a strong close to year-end trading, with revenue up across all three of its core trading segments, as 2022 financial results exceed previous expectations.

The NYSE-listed sportstech and data group saw its full year 2022 revenues rise 30% from $262.7m to $341m, whilst Q4 income increased 25.4% to $105.3m (2021: $84m).

This enabled the firm to further chip away at its net losses, reducing said losses by 69% across the full 12 months from £592.7m to $181.6m, although some progress was lost in the final quarter. 

Primarily attributed by Genius to a loss in foreign currency, the group’s profit stayed negative in the final quarter, falling from a loss of $53.3m in Q4 2021 to $127.7m.

EBITDA, meanwhile, stood at £15.8m, up 918% from just $1.15m in 2021, and by 121% in Q4 to $2.6m from a negative figure of £12.5m the year prior.

Mark Locke, Genius Sports Co-Founder and CEO, said: “Our 2022 results demonstrate our commitment to executing the financial and strategic plan we outlined in our Investor Day at the start of 2022, and we have successfully delivered on our forecast each quarter,”

“”We remain relentlessly focused on balancing investment in our highest growth initiatives, while still demonstrating the unique operating leverage of our business model.”

A segment breakdown saw the group’s Betting Technology, Content and Services division register the largest revenue of $209.2m, an 18% increase on the year prior ($177.2m), although Media, Technology, Content and Services recorded the largest growth rate of 71.2%.

Income for the latter division stood at $82.7m ($48.3m), and the Sports Technology and Services unit rounded off full year trading with £49m ($38.2m), year-on-year growth of 40%.

On a quarterly basis, Media, Tech, Content and Services again led the charge for growth with a 50% uptick from $17m to $25.6m. Betting Technology, Content and Services’ quarterly revenue rose 21% YoY to $65.5m ($54m) and Sports Technology also continued to perform well, reporting growth of 9% to $14.2m ($13m).

Locke concluded: “Following our consistent execution in 2022 and the maturation of our technology investments, the stage is now set for 2023 to capture the immense opportunity ahead of us, afforded by the global competitive position we have built to-date.”

The group’s Q4 performance was driven heavily by a range of key business developments which saw Genius work on major projects with several prominent sports and sports betting partners.

This included the expansion of Second Spectrum’s data deal with Football DataCo to include sub-second skeletal tracking for the Premier League and production of a three-point shot tracker for the NBA on ESPN, as well as the launch of ‘Watch and Bet’ NFL video streams in the US and Canada.

Sports betting specific deals saw an extension of Genius’ partnership with bet365 to include Second Spectrum tracking technology, and the acquisition of an Ohio gaming licence.

Closing the year on the back of this series of deals, Genius declared a cash balance of $159m – including $36m of restricted cash – and projects positive free-cash-flow in the second half of 2023.

Nick Taylor, Genius Sports CFO, remarked: “Our expectation of nearly tripling our Group Adj. EBITDA and generating free-cash-flow in the second half of 2023 is the direct result of a cost base that does not need to grow in-line with revenues moving forward. 

“With $159m of total cash on our balance sheet, zero debt financing, and our legacy warrants now removed, our shareholders are well positioned to capture the benefits of profitability and cash flow acceleration.”

Looking to 2023, Genius projects that group revenues will stand at $391m (+14%), with the sportstech group delivering an adjusted EBITDA of approximately $41m – dependent on FX fluctuations.

Furthermore, NYSE investors were further notified that Genius expects to achieve its  positive free-cash-flow status by the second half of 2023 trading,