Earnings call: Genius Sports beats Q4 guidance with strong revenue growth

Genius Sports Limited (NYSE: GENI) had a strong achievement in the fourth quarter of 2023, with sales of $ 127 million, exceeding the company guidance of $ 126 million, and increased 21 % yea r-o n-year. It became. The ful l-year sales were $ 413 million, exceeding expectations, up 21%yea r-o n-year.

After the fourth quarter adjustment, EBITDA was $ 12 million, exceeding the guidance of $ 11 million, and EBITDA was $ 53 million after the year's adjustment. The free cash flow in the second half of 2023 was surplus of $ 11 million. For 2024, Genius Sports expects EBITDA to increase at least $ 480 million, up at least $ 16%, up to $ 41%.

Key Takeaways

• The Genius Sports recorded $ 127 million, exceeding sales guidance in the fourth quarter of 2023, suggesting 21%of the previous year.
• The annual sales were $ 2 million, exceeding the guidance of $ 22 million, up 21 % yea r-o n-year.
• After the adjustment, the EBITDA conversion was performed by $ 53 million over the year.
• In the second half of 2023, a plus of $ 11 million was achieved, and plus cash flow is expected to continue in 2024.
• Genius Sports predicts the minimum profit growth rate in 2024 to $ 16%to $ 480 million, an increase in EBITDA growth, an increase of $ 75 million.
• BETVISION's sales and i n-play gambling are greatly contributing to the company's revenue growth.
• Media technology sales are expected to grow by about 15%in 2024.
• The company is looking for exciting technologies with cautious and appropriate prices at M & Amp; A.

Company Outlook

• Genius Sports is expected to maintain a positive free cash flow every year since 2024.
• The company's cost base is relatively stable, and it is expected that there is no significant increase to achieve EBITDA after sales and adjustments.
• In 2024, profits growth, margin expansion, and cash flow creation is expected.

Bearish Highlights

• The growth of Europe slowed down yea r-o n-year in the fourth quarter of 2022.
• The company states that loyalty costs are lum p-sum payments, and the potential effects of exchange rates are slightly offset.

Bullish Highlights

• Genius Sports expects about 20 % of US businesses per year and about 15 % in Europe.
• I n-game gaming, which accounts for about 20 % of NFL gambling, increased the annual GGR by 140 %.
• The company is carefully exploring new market opportunities, such as the Brazilian sports betting market.

Misses

• While the results were strong overall, the company acknowledged that revenues from multimedia technology may fluctuate due to the timing of spending on sports betting.

Q&A Highlights

• The company emphasized its model of working with partners to broadly distribute sports merchandise, rather than pursuing a monopoly approach.
• NFL win rates have limited impact on overall revenues, and the company is forecasting a flat win rate for the next fiscal year to ensure stability and predictability of financial results.
• There were no further questions at the end of the conference call, indicating a comprehensive presentation on the company's financial condition and outlook.

InvestingPro Insights

Genius Sports Limited (NYSE: GENI) shows significant growth and potential, as reflected in its recent financial reports.

Genius Sports has a significant market presence, with a market capitalization of $1. 38 billion, according to InvestingPro data. Despite the challenging environment, the company's revenue growth has been impressive, growing 22, 35% over the trailing 12 months since Q1 2023. This growth trajectory is further evidenced by the quarterly revenue growth of 29, 34% in Q1 2023, demonstrating the company's ability to effectively expand its revenue streams.

However, InvestingPro Advice points out some concerns. Genius Sports maintains more cash than debt on its balance sheet, which is a positive sign for financial stability. However, the company suffers from weak gross profit margins, with a trailing 12 month margin of just 15. 77% as of Q1 2023. This could be a focal point for investors looking for companies with potentially stronger profitability. Furthermore, the stock price has been fairly volatile, with past three month returns of 26, 28%, reflecting both the opportunities and risks inherent in investing in GENI.

For those considering investing in Genius Sports, it is worth noting that analysts do not forecast the company to be profitable this year, and it has not been profitable in the past 12 months. This information, combined with the fact that Genius does not pay dividends to its shareholders, may influence your investment decision based on your personal risk tolerance and investment objectives.

To dig deeper into Sports Genius and discover more tips from InvestingPro, visit https://www. investing. com/. We have seven more tips to further guide your investment considerations. Don't forget to use coupon code PRONEWS24 to get an additional 10% off your annual or semi-annual Pro and Pro+ subscriptions, providing a comprehensive toolset for the experienced investor.

Full transcript - dMY Technology Group II (GENI) Q4 2023:

Handling I'm Krista, your operator for today's conference. Welcome to Genius Sports' Q4 2023 Earnings Conference Call. [Operator Instructions] Thank you. Now I would like to turn the conference over to Genius Sports. Please begin the call.

Representative of Unfamiliar Company: Thank you. Before we begin this call, we want you to be aware that certain statements made during this call may constitute forward-looking statements and involve risks that could cause our actual results to deviate materially from our historical performance and expectations. We assume no responsibility to update these forward-looking statements. All such statements should be read in conjunction with the cautionary statements contained in our earnings release and the risk factor statements contained in our filings with the SEC, including our Annual Report on Form 20-F filed with the SEC on March 30, 2023. During the conference call, we will also discuss certain non-GAAP measures that management believes are useful in evaluating Genius' performance. A reconciliation of these non-GAAP measures to the most directly comparable U. S. GAAP measures can be found in our earnings release and earnings presentation materials. Now, I will turn the call over to our CEO, Mark Rock.

Mark Rock: Good morning. I'm pleased to conclude this year with another solid performance. Over the past few years, we have set ourselves a number of strategic and commercial objectives that position us for structural and sustained success. The success of these objectives is evident in the financials we report today, where we have exceeded expectations for the eighth consecutive quarter and our business is stronger, better positioned and more profitable than ever before. In summary, fourth quarter sales were $127 million, beating our guidance of $126 million and growing 21% year over year. This brings full year sales to $413 million, beating our guidance at the beginning of the year by $22 million and up 21% over full year 2022. Based on a cost base that is not accretive to sales growth, we are committed to converting 52% of each incremental dollar into Adjusted EBITDA in 2023, demonstrating the clear operating leverage of our business model. Fourth quarter adjusted EBITDA was $12 million, also above guidance, and full year adjusted EBITDA was $53 million, growing approximately 3. 5x versus 2022 and achieving margin expansion of over 800 basis points. Importantly, this resulted in positive free cash flow of $11 million for the second half of 2023, in line with guidance for the full year. We expect to maintain positive free cash flow year over year in 2024, which marks an important inflection point for the business. Several growth factors contributed to the outperformance in 2023, and this momentum should continue into 2024. We expect sales to grow at least 16% to $480 million and adjusted EBITDA to grow at least 41% to $75 million in 2024. We expect this near-term growth momentum to continue over the long term, and each year gives us more confidence in our long-term strategic and financial goals. As we expand our suite of technology solutions and foster new forms of fan loyalty and revenue streams, our top-tier partnerships continue to strengthen. This ultimately gives us the confidence to not only maintain our technology relationships, but to expand them for the long term. Notable examples this year include Football DataCo's expanded partnership with the NFL, and we also recently announced a 10-year strategic partnership with FIBA.

We plan to provide our computational technology and AI-powered capabilities to all 200 national federations around the world, covering tens of thousands of global basketball events per year. With our scale and best-in-class technology, we have diverse channels to generate revenue from our relationships with various leagues. This includes unlocked opportunities with broadcasters, content distributors, sponsors, advertising, and of course our sportsbook customers. For our sportsbook customers, the same technology creates new value-enhancing products to better engage viewers and drive more betting activity. BetVision is a great example of this. Each of these different touchpoints solidifies our position at the center of the digital sports ecosystem and, most importantly, leads to sustainable improvement in the financial metrics we care about most. This includes stable revenue growth, disciplined cost management, margin expansion, and free cash flow generation. Given our many growth drivers and high visibility into our cost base, we are more confident than ever in achieving our long-term EBITDA margin target of 30% or more. Now, let's review the key metrics for the quarter. Here is a breakdown:

In the end, we will grow with him, regardless of which business will win. For example, in Florida, the only operator, the current hard rock, the resumption of online sports betting in this quarter has quickly increased profits. In particular, NFL, especially this year, is particularly impressive in terms of betting, especially in the number of implay handles, increased by 60 % yea r-o n-year and GGR increased 140 %. The most encouraging thing is that i n-game margins have improved significantly compared to the first NFL season in 2021. We always have said that i n-game gags increase naturally as the market mature, but now it is starting to see it. We also believe this is a produc t-led evolution, and the introduction of BETVISION this season is a very attractive product evidence that enables more Impure gambling in NFL games. In the first quarter of the first release of BetVision, we explained how to simplify and strengthen the ability to track the Impure Gambling. BETVISION is a valuable sports book, which offers many of the excellent technical advantage of Genius, such as live odds, players and team statistics, and nex t-generation extensions, and provides differentiated i n-game betting experiences. We hope that it will be indispensable for attracting and incorporating a stable customer base. We also provided some early data, indicating that Sports Betting has helped to increase i n-game betting. At that time, it was a small sample, but after the full season, I am glad that this number was consistently maintained until the end of the season. In summary, 50%of the total number of bets by the BetVision streamer was an impression. 76%of the total handle betting or total dollar betting by the BetVision streamer was due to the i n-play bet. In addition, comparing the first half of the season and the second half, the total of the betting handle and the total Impreveting handle are tripled. We are very satisfied with the early success of this product and the value we created for Sports Betting and NFL partners. But what we are most excited about is the opportunity to develop new features for the innovative roadmap and NFL, and expand this product to more sports. We are currently building a platform that creates millions of viewers, and this platform has developed new features for NFL sports betting partners and NFL sports betting partners. We provide opportunities to expand products to more sports.

And the show is rapidly converging, and we provide an important solution for our partner to stand at the forefront of this trend. BETVISION products will announce more features to achieve a completely personalized interactive experience. Please look forward to the future. BETVISION is only one of the many initiative we have provided to succeed to sports customers. In this way, we believe that we are a true added value partner for the sports book, and we believe that sportsbooks will win more tools to grow business. As a result, our business model has been able to grow with customers, and as a result, we have maintained stable pure income in recent years. Slide 8 lists the latest indicators of net income maintenance rate, which shows a track record of enhancing customer value for a long time. Remember that there are multiple inputs that contribute to the growth of each customer. For example, if you sign a revenue share contract in a hig h-growing market in the United States and other countries, the value has increased naturally based on various factors, such as expanding TAM, increasing i n-game games, and improving winning rate. However, it is growing in the form of new services. < SPAN> The show is rapidly converging, and we offer an important solution for the partner to keep at the forefront of this trend. BETVISION products will announce more features to achieve a completely personalized interactive experience. Please look forward to the future. BETVISION is only one of the many initiative we have provided to succeed to sports customers. In this way, we believe that we are a true added value partner for the sports book, and we believe that sportsbooks will win more tools to grow business. As a result, our business model has been able to grow with customers, and as a result, we have maintained stable pure income in recent years. Slide 8 lists the latest indicators of net income maintenance rate, which shows a track record of enhancing customer value for a long time. Remember that there are multiple inputs that contribute to the growth of each customer. For example, if you sign a revenue share contract in a hig h-growing market in the United States and other countries, the value has increased naturally based on various factors, such as expanding TAM, increasing i n-game games, and improving winning rate. However, it is growing in the form of new services. And the show is rapidly converging, and we provide an important solution for our partner to stand at the forefront of this trend. BETVISION products will announce more features to achieve a completely personalized interactive experience. Please look forward to the future. BETVISION is only one of the many initiative we have provided to succeed to sports customers. In this way, we believe that we are a true added value partner for the sports book, and we believe that sportsbooks will win more tools to grow business. As a result, our business model has been able to grow with customers, and as a result, we have maintained stable pure income in recent years. Slide 8 lists the latest indicators of net income maintenance rate, which shows a track record of enhancing customer value for a long time. Remember that there are multiple inputs that contribute to the growth of each customer. For example, if you sign a revenue share contract in a hig h-growing market in the United States and other countries, the value has increased naturally based on various factors, such as expanding TAM, increasing i n-game games, and improving winning rate. However, it is growing in the form of new services.

In particular, they continue to develop innovative products and have many opportunities to launch them into the market. In particular, we continue to develop innovative products and have many opportunities to put them into the market. Then, I would like to talk about the details of the financial results and the guidance of 2024 in place of Nick. We continue to develop innovative products and have many opportunities to put them into the market. Then, I would like to talk about the details of the financial results and the guidance of 2024 in place of Nick. < SPAN> Especially because we continue to develop innovative products and have many opportunities to launch them into the market. In particular, we continue to develop innovative products and have many opportunities to put them into the market. Then, I would like to talk about the details of the financial results and the guidance of 2024 in place of Nick. We continue to develop innovative products and have many opportunities to put them into the market. Then, I would like to talk about the details of the financial results and the guidance of 2024 in place of Nick. In particular, they continue to develop innovative products and have many opportunities to put them into the market. In particular, we continue to develop innovative products and have many opportunities to put them into the market. Then, I would like to talk about the details of the financial results and the guidance of 2024 in place of Nick. We continue to develop innovative products and have many opportunities to put them into the market. Then, I would like to talk about the details of the financial results and the guidance of 2024 in place of Nick.

Nick Taylor: Thank you, Mark. I think the headlines from the mark are already listening, but the consistency of performance throughout the year is worth repeated. This year, we have exceeded expectations for every quarter and revised the outlook. In the third quarter, sales were $ 127 million, initially $ 124 million in guidance, and exceeded $ 126 million, a guidance update. This is the same on EBITDA based after adjustment, and has achieved a hig h-score flow from the growth of revenue. After the adjustment, EBITDA recorded $ 12 million in the fourth quarter, about 4. 5 times, exceeding the $ 11 million of guidance. Throughout the year, we have reorganized the prospects that free cash flow will be positive in the second half of 2023, but in the second half of the year, we have created a cache of $ 11 million and achieved this very important milestone. I am happy to be able to report. In addition to sales and EBITDA growth, consistent margins over the year are also worth noting. Not only exceeded sales and EBITDA goals throughout the year, but as shown in the slide 11, the EBITDA margin has also expanded at least 600 Basis points in each quarter. This is the same in gloss. < SPAN> Nick Taylor: Thank you, mark. I think the headlines from the mark are already listening, but the consistency of performance throughout the year is worth repeated. This year, we have exceeded expectations for every quarter and revised the outlook. In the third quarter, sales were $ 127 million, initially $ 124 million in guidance, and exceeded $ 126 million, a guidance update. This is the same on EBITDA based after adjustment, and has achieved a hig h-score flow from the growth of revenue. After the adjustment, EBITDA recorded $ 12 million in the fourth quarter, about 4. 5 times, exceeding the $ 11 million of guidance. Throughout the year, we have reorganized the prospects that free cash flow will be positive in the second half of 2023, but in the second half of the year, we have created a cache of $ 11 million and achieved this very important milestone. I am happy to be able to report. In addition to sales and EBITDA growth, the consistent margin expansion throughout the year is also worth noting. Not only exceeded sales and EBITDA goals throughout the year, but as shown in the slide 11, the EBITDA margin has also expanded at least 600 Basis points in each quarter. This is the same in gloss. Nick Taylor: Thank you, Mark. I think the headlines from the mark are already listening, but the consistency of performance throughout the year is worth repeated. This year, we have exceeded expectations for every quarter and revised the outlook. In the third quarter, sales were $ 127 million, initially $ 124 million in guidance, and exceeded $ 126 million, a guidance update. This is the same on EBITDA based after adjustment, and has achieved a hig h-score flow from the growth of revenue. After the adjustment, EBITDA recorded $ 12 million in the fourth quarter, about 4. 5 times, exceeding the $ 11 million of guidance. Throughout the year, we have reorganized the prospects that free cash flow will be positive in the second half of 2023, but in the second half of the year, we have created a cache of $ 11 million and achieved this very important milestone. I am happy to be able to report. In addition to sales and EBITDA growth, the consistent margin expansion throughout the year is also worth noting. Not only exceeded sales and EBITDA goals throughout the year, but as shown in the slide 11, the EBITDA margin has also expanded at least 600 Basis points in each quarter. This is the same in gloss.

In any form, how to add content, expand service, launch new products, increase advertising expenses, what is the meaning of the growth of Genius and our customers? I'm excited. Of course, we are always acquiring new customers. Sports books for our official data, advertisers who buy our media and fan royalty products, and broadcasting stations that buy our reinforcement solutions. Again, it is expected that many of these components will contribute to EBITDA after adjusting the Group, as most of these components do not cost any or additional costs at all. After adjusting in 2024, the group EBITDA expects $ 75 million, which is equivalent to 41%growth and 16%margin. Nevertheless, there is a remarkable seasonality, so I would like to definitely clarify the EBITDA income rate over the year. As described in the past, our royalty rate is set to be predictable every year, and its raising width has been slightly larger than 2023. In addition, the expansion of partnerships with NFL will slightly increase the royalty fee related to domestic live video streams used in BetVision products. What I want to clarify is that BetVision is dynamic. < SPAN> In addition to the addition of content, the expansion of services, the introduction of new products, the increase in advertising expenses, what is the meaning of the growth of Genus and our customers? We are excited. Of course, we are always acquiring new customers. Sports books for our official data, advertisers who buy our media and fan royalty products, and broadcasting stations that buy our reinforcement solutions. Again, it is expected that many of these components will contribute to EBITDA after adjusting the Group, as most of these components do not cost any or additional costs at all. After adjusting in 2024, the group EBITDA expects $ 75 million, which is equivalent to 41%growth and 16%margin. Nevertheless, there is a remarkable seasonality, so I would like to definitely clarify the EBITDA income rate over the year. As described in the past, our royalty rate is set to be predictable every year, and its raising width has been slightly larger than 2023. In addition, the expansion of partnerships with NFL will slightly increase the royalty fee related to domestic live video streams used in BetVision products. What I want to clarify is that BetVision is dynamic. In any form, how to add content, expand service, launch new products, increase advertising expenses, what is the meaning of the growth of Genius and our customers? I'm excited. Of course, we are always acquiring new customers. Sports books for our official data, advertisers who buy our media and fan royalty products, and broadcasting stations that buy our reinforcement solutions. Again, it is expected that many of these components will contribute to EBITDA after adjusting the Group, as most of these components do not cost any or additional costs at all. After adjusting in 2024, the group EBITDA expects $ 75 million, which is equivalent to 41%growth and 16%margin. Nevertheless, there is a remarkable seasonality, so I would like to definitely clarify the EBITDA income rate over the year. As described in the past, our royalty rate is set to be predictable every year, and its raising width has been slightly larger than 2023. In addition, the expansion of partnerships with NFL will slightly increase the royalty fee related to domestic live video streams used in BetVision products. What I want to clarify is that BetVision is dynamic.

In addition, since the prediction is high in any year, it is worth checking the approximate form of cash operating costs in 2024. To put it in case, our cost base is relatively stable, and we believe that this year we will not significantly increase the cost base this year to achieve EBITDA after higher sales and adjustments. 。 For example, whether selling in 100 sportsbooks or selling in a 1, 000 sports book, the direct costs related to the loyalty are not out of the prediction. Similarly, as shown on the no n-GAAP basis in slide 19, the total cost of other operating costs that are below the cost of sales has been relatively flat, despite the significant increase in sales. We expect this trend to continue in 2024. In conclusion, we are very excited about the number of ways to win for 2024. We have created highly defensive competitiveness through stat e-o f-th e-art technology development. We have strengthened partnerships with leagues and federation around the world. In addition, we have released exciting new products so that partner companies can be more closely related to customers. In this way, our business is ready to benefit from multiple growth drivers, and we hope that it will promote continuous revenue growth and expansion of profit margins.

I'm an administrator. please.

Ryan Sigdal: Good morning. Evaluate the indicator of slide 7. Please tell us if you can say anything about the plan to release similar products in other sports, how difficult it is from a technical point of view and how effect you can do it. What are the biggest issues when launching a sportbook other than four types on this platform? Why can't you do other sports books faster? < SPAN> In addition, since there is a high prediction in any year, it is worth checking a little about the approximate form of cash operating costs in 2024. To put it in case, our cost base is relatively stable, and we believe that this year we will not significantly increase the cost base this year to achieve EBITDA after higher sales and adjustments. 。 For example, whether selling in 100 sportsbooks or selling in a 1, 000 sports book, the direct costs related to the loyalty are not out of the prediction. Similarly, as shown on the no n-GAAP basis in slide 19, the total cost of other operating costs that are below the cost of sales has been relatively flat, despite the significant increase in sales. We expect this trend to continue in 2024. In conclusion, we are very excited about the number of ways to win for 2024. We have created highly defensive competitiveness through stat e-o f-th e-art technology development. We have strengthened partnerships with leagues and federation around the world. In addition, we have released exciting new products so that partner companies can be more closely related to customers. In this way, our business is ready to benefit from multiple growth drivers, and we hope that it will promote continuous profits growth and expansion of profit margins.

I'm an administrator. please.

Ryan Sigdal: Good morning. Evaluate the indicator of slide 7. Please tell us if you can say anything about the plan to release similar products in other sports, how difficult it is from a technical point of view and how effect you can do it. What are the biggest issues when launching a sportbook other than four types on this platform? Why can't you do other sports books faster? In addition, since the prediction is high in any year, it is worth checking the approximate form of cash operating costs in 2024. To put it in case, our cost base is relatively stable, and we believe that this year we will not significantly increase the cost base this year to achieve EBITDA after higher sales and adjustments. 。 For example, whether selling in 100 sportsbooks or selling in a 1, 000 sports book, the direct costs related to the loyalty are not out of the prediction. Similarly, as shown on the no n-GAAP basis in slide 19, the total cost of other operating costs that are below the cost of sales has been relatively flat, despite the significant increase in sales. We expect this trend to continue in 2024. In conclusion, we are very excited about the number of ways to win for 2024. We have created highly defensive competitiveness through stat e-o f-th e-art technology development. We have strengthened partnerships with leagues and federation around the world. In addition, we have released exciting new products so that partner companies can be more closely related to customers. In this way, our business is ready to benefit from multiple growth drivers, and we hope that it will promote continuous revenue growth and expansion of profit margins.

I'm an administrator. please.

Ryan Sigdal: Good morning. Evaluate the indicator of slide 7. Please tell us if you can say anything about the plan to release similar products in other sports, how difficult it is from a technical point of view and how effect you can do it. What are the biggest issues when launching a sportbook other than four types on this platform? Why can't you do other sports books faster?

Mark Rock: Well, Ryan, mark. It has always been planned to build a scalable platform. Development of other sports is a clear focus for us. Technically, this integration and development are very easy, and we hope that many sports will be released in the next 12 months. Regarding additional sports books, I think integration speed is one of the issues. So we have been working with the sportsbook to demonstrate the concept. It is a very clear and powerful product, and there are many evidence. This is a case where the integrated pipeline is managed in cooperation with a partner and sportsbooks live with new products.

RYAN SIGDAHL (hereinafter-): That's great. Thank you, mark. Nico, one. Looking at the quarterly guidance this year, the fourth quarter is likely to be a record high and thre e-digit upside. There are some concerns that the contract with NFL will be uneven and will not make a profit for you. Considering that the fourth quarter is a NFL game, this concern seems to be inconsistent. So, can you answer your position, NFL, and your risk? thank you.

Nick Taylor: Hello, Ryan. I would like to tell you about our achievements in the past three years after winning NFL. Ryan: I think it was really 2021, but at that time we were in the deficit on ebitda. In 2022, we achieved 5 % margins. This year, the EBITDA margin reached 13%in 2023 and 16%in 2024. That said, the margin is expanding not only in the quarterly, but also in the fourth quarter expectation. So, in order to refute Ryan, I would like to point out what we have already achieved, what we are leading, and what we intend to achieve in 2024.

Ryan Sigdal: Great. It's a little follo w-up. Is this a full cash contract for the fourth quarter? thank you. I pray for good luck. < SPAN> Mark Rock: Yeah, Ryan, Mark. It has always been planned to build a scalable platform. Development of other sports is a clear focus for us. Technically, this integration and development are very easy, and we hope that many sports will be released in the next 12 months. Regarding additional sports books, I think integration speed is one of the issues. So we have been working with the sportsbook to demonstrate the concept. It is a very clear and powerful product, and there are many evidence. This is a case where the integrated pipeline is managed in cooperation with a partner and sportsbooks live with new products.

RYAN SIGDAHL (hereinafter-): That's great. Thank you, mark. Nico, one. Looking at the quarterly guidance this year, the fourth quarter is likely to be a record high and thre e-digit upside. There are some concerns that the contract with NFL will be uneven and will not make a profit for you. Considering that the fourth quarter is a NFL game, this concern seems to be inconsistent. So, can you answer your position, NFL, and your risk? thank you.

Nick Taylor: Hello, Ryan. I would like to tell you about our achievements in the past three years after winning NFL. Ryan: I think it was really 2021, but at that time we were in the deficit on ebitda. In 2022, we achieved 5 % margins. This year, the EBITDA margin reached 13%in 2023 and 16%in 2024. That said, the margin is expanding not only in the quarterly, but also in the fourth quarter expectation. So, in order to refute Ryan, I would like to point out what we have already achieved, what we are leading, and what we intend to achieve in 2024.

Ryan Sigdal: Great. It's a little follo w-up. Is this a full cash contract for the fourth quarter? thank you. I pray for good luck. Mark Rock: Well, Ryan, mark. It has always been planned to build a scalable platform. Development of other sports is a clear focus for us. Technically, this integration and development are very easy, and we hope that many sports will be released in the next 12 months. Regarding additional sports books, I think integration speed is one of the issues. So we have been working with the sportsbook to demonstrate the concept. It is a very clear and powerful product, and there are many evidence. This is a case where the integrated pipeline is managed in cooperation with a partner and sportsbooks live with new products.

RYAN SIGDAHL (hereinafter-): That's great. Thank you, mark. Nico, one. Looking at the quarterly guidance this year, the fourth quarter is likely to be a record high and thre e-digit upside. There are some concerns that the contract with NFL will be uneven and will not make a profit for you. Considering that the fourth quarter is a NFL game, this concern seems to be inconsistent. So, can you answer your position, NFL, and your risk? thank you.

Nick Taylor: Hello, Ryan. I would like to tell you about our achievements in the past three years after winning NFL. Ryan: I think it was really 2021, but at that time we were in the deficit on ebitda. In 2022, we achieved 5 % margins. This year, the EBITDA margin reached 13%in 2023 and 16%in 2024. That said, the margin is expanding not only in the quarterly, but also in the fourth quarter expectation. So, in order to refute Ryan, I would like to point out what we have already achieved, what we are leading, and what we intend to achieve in 2024.

Ryan Sigdal: Great. It's a little follo w-up. Is this a full cash contract for the fourth quarter? thank you. I pray for good luck.

Nick Taylor: Yes. Ryan, that's right. As you know, the initial contract included the previous annual salary warrant. As part of the extension of the contract in the middle of 23 years, it was replaced with full cash. As a result, it became such a number.

Operator: The next question is the series of Nedam and Company Bernie Mactanan. please.

Bernie Mactanan: That's good. Thank you for your question. First of all, as for the bed vision, the Better who accessed the bed vision during the 23rd NFL season was a minority. Based on the wonderful details described in Slide 7, what would the profit growth would be if you deploy BetVision to all the US sports betting operators in the next NFL season?

Mark Rock: Yes. Although it may be a minority on the numbers, I think it is probably not a minority on the share. The release has been successful, including Fanduel. When thinking about the bed vision, I think it is important how to connect the profits and profits. So, obviously we are share. As you know, we have gained a pr e-match share and gained about three times the live share. Also, in addition to the fact that BetVision concentrates the audience on many of the games and occupies a large part of liv e-betting, the fact that the triple ratio that can be obtained during the game is growing rapidly. It is really useful.

Bernie McTernan: I see. Thank you, mark. Then, media technology revenue is also increasing. When optimizing the model of 24], should we consider more growth when thinking about 10 % growth, 20 % growth, or "24"?

Nick Taylor: Yes. Barney, Nick. As you know, the media is just a matter of expenditure. In the fourth quarter, some sportsbooks saved spending during the Christmas NFL game, spending on the playoffs instead of the first quarter. Now, how we have predicted 24 years is that we don't have any specific guidance, but we are considering a 15 % cycl e-growth yea r-o n-year for 2024. I think it's better to think conservatively, but as you are here today, you need to do a lot of things in 24 years to achieve it.

Bernie Maxarnan: I understand. Thank you, Nico.

Administrator: Our next question is from Jed Kelly of Oppenheimer. Go ahead.

Jed Kelly: Good afternoon. Thanks for taking my question. Just two questions, if I may. I want you to look at the slide, on the right, it looks like your data costs are $195 million. It looks like it's growing. I don't know. Maybe around 30%. So it's a little faster than revenue. Can you talk me through what's going on? And then a question for Mark. We've seen a lot of innovation around streaming, especially with Apple's (NASDAQ: AAPL) phones, YouTube TV, and so on, so how do you see Genius and your technology positioned? Thank you.

Nick Taylor: Hey, Jed. I'll turn it over to Mark for the second part. I'm happy with the dip that we've experienced in 2023. Cyclical crossover is at 53%. On a cash basis, you can see that it's really cyclical over the last 36 months. Look at the progression from '23 to '24. The cost base is flat year over year. I'd say somewhere around $208 million to $210 million. So the operating leverage is obviously driven by the business. That should continue beyond 2024. Now, on royalties, first of all, royalties are stable and have great visibility. But they're not necessarily linear. They can be amorphous in the royalty cycle. As you said, there's a slightly higher step-up in royalties from '23 to '24 than there was from '22 to '23. So we expect the driver to be down about 33%. But just to be clear, Jed, this is going to drive EBITDA margin expansion on a cyclical basis even in '24.

Mark Locke: Hi, Jed, it's Mark. To your second question, this is very broad and there's some developments going on. It's an area that we've been proactively investing in for many years. And a lot of the work that we've done in the second range has us very well prepared. This is part of a broader digitization of the sports ecosystem, and that's exactly what we're doing. This will have a very powerful impact on the media business, giving us more output of sports and another way for fans to engage. There are some things you should think about. Content rights are a big part of what it takes to get these things. So there's still quite a bit of work to be done in terms of how Apple presents sports. And I would say be a little bit careful about getting too excited about the revenue streams at this stage. Partnering with a company like Apple and providing a lot of data in the Apple Sports app. I think we're in a strong position for when this kind of thing becomes mainstream and the data rights market and distribution of it becomes a little bit broader.

Jed Kelly: Thank you.

Admin: Next question is from Jordan Bender from Citizens JMP.

Jordan Bender: Good morning, everyone. I want to follow up on Jen's question. The margins that have been slowly declining from 53% in the mid 30s through '24, is this all related to higher royalties or is there more investment in the business outside of the royalty expense in '24 that you're trying to get back?

Nick Taylor: Yes. Jordan. I think you've prepared a slide on the deck on a cos t-based deck on a cash basis. Including everything other than royalties, cos t-based costs will be $ 28 million to $ 210 million from the previous year. This is almost the same level dating back to 2022. In other words, there is almost no cost to increase profits. As I mentioned earlier, the royalty position is the driving force. I think the royalty position will be 154 to 190-1. This means that royalties are not linear, and there are irregular years. From 22nd to 23rd, he jumped a little big and jumped a little from 23 to 24 years. And after 2024, if the average is slightly larger or a little less, we will always guide you.

Jordan vendor: I see. According to the slide, the percentage of Imprees in GGR exceeds 20%, but in light of the outlook and guidance indicated by Investor Day in 22 years, it is greatly improved than that predictive level. It means that you are doing it. I know that there is no crystal ball, but can you think that the change in the game is accelerating with the release of the product? Also, the second question to the mark is what you mentioned in the prepared remarks, but is it useful for the current price negotiations? < SPAN> Nick Taylor: Yes. Jordan. I think you've prepared a slide on the deck on a cos t-based deck on a cash basis. Including everything other than royalties, cos t-based costs will be $ 28 million to $ 210 million from the previous year. This is almost the same level dating back to 2022. In other words, there is almost no cost to increase profits. As I mentioned earlier, the royalty position is the driving force. I think the royalty position will be 154 to 190-1. This means that royalties are not linear, and there are irregular years. From 22nd to 23rd, he jumped a little big and jumped a little from 23 to 24 years. And after 2024, if the average is slightly larger or a little less, we will always guide you.

Jordan vendor: I see. According to the slide, the percentage of Imprees in GGR exceeds 20%, but in light of the outlook and guidance indicated by Investor Day in 22 years, it is greatly improved than that predictive level. It means that you are doing it. I know that there is no crystal ball, but can you think that the change in the game is accelerating with the release of the product? Also, the second question to the mark is what you mentioned in the prepared remarks, but is it useful for the current price negotiations? Nick Taylor: Yes. Jordan. I think you've prepared a slide on the deck on a cos t-based deck on a cash basis. Including everything other than royalties, cos t-based costs will be $ 28 million to $ 210 million from the previous year. This is almost the same level dating back to 2022. In other words, there is almost no cost to increase profits. As I mentioned earlier, the royalty position is the driving force. I think the royalty position will be 154 to 190-1. This means that royalties are not linear, and there are irregular years. From 22nd to 23rd, he jumped a little big and jumped a little from 23 to 24 years. And after 2024, if the average is slightly larger or a little less, we will always guide you.

Jordan vendor: I see. According to the slide, the percentage of Imprees in GGR exceeds 20%, but in light of the outlook and guidance indicated by Investor Day in 22 years, it is greatly improved than that predictive level. It means that you are doing it. I know that there is no crystal ball, but can you think that the change in the game is accelerating with the release of the product? Also, the second question to the mark is what you mentioned in the prepared remarks, but is it useful for the current price negotiations?

Mark Lock: Absolutely. We're cautiously optimistic on that front. And again, when you look at the numbers and the percentage of bets on BetVision, it's really product-based. That's really good for us and I think we're in a really strong position. I think the other thing that's worth keeping in mind when you think about this is margin improvement. One of the things that we've always focused on and are very excited about in this game is to improve margins substantially. The shift to gaming, the margin increase, the addition of some pretty new products like Betvision, the combined effect of those things puts us in a favorable position. In terms of renegotiating contracts, we as a business have built this and take it very seriously to be a good partner in sports and in the sportsbook. And when we think about renegotiating contracts, obviously, we all want the contracts to be successful. So the way that we help our bookmaker partners be successful is by increasing margins through the launch of new products like BetVision and Edge.

Jordan Bender: Thank you very much.

Admin: The next question is from Chad Beynon of Macquarie. Go ahead.

Chad Beynon: Good morning. I wanted to ask you about the '24 guides, and specifically the sports betting guide. Nick, you mentioned on the 23rd that North America GGR was up 50%. For '24, we expect North America GGR to be in the teens to 20s. But what do you think about the betting market outside of the NFL? Let's call it high house, low doubles, outside of the US. Thank you.

Nick Taylor: Chad, Nick. I think we commented on some of them at the 3rd and 4th quarter financial results briefing. The third quarter of Europe overlapped with the fourth quarter of 2022 and slowed down a little. In other words, we are generally considered that US businesses generally expect a recycling crossover growth of 20 % per year, and European businesses are expected to grow 15 %. So the growth in Europe is very healthy.

Mark Rock: And I'm sorry for the macro story, but one of the European macros is very interesting now. In other words, although not as aggressive as the United States, there are shinse signs. In Belgium, online has progressed, and gambling over the age of 21 has been legalized. I think there are still many possibilities in the market.

Chad Baynon: Great. thank you. And about additional technology, s o-called tac k-in and bolts, what about public and private evaluation spreads? Is there still a chance to add to the second spectrum, such as a bet vision? < SPAN> Nick Taylor: Chad, Nick. I think we commented on some of them at the 3rd and 4th quarter financial results briefing. The third quarter of Europe overlapped with the fourth quarter of 2022 and slowed down a little. In other words, we are generally considered that US businesses generally expect a recycling crossover growth of 20 % per year, and European businesses are expected to grow 15 %. So the growth in Europe is very healthy.

Mark Rock: And I'm sorry for the macro story, but one of the European macros is very interesting now. In other words, although not as aggressive as the United States, there are shinse signs. In Belgium, online has progressed, and gambling over the age of 21 has been legalized. I think there are still many possibilities in the market.

Chad Baynon: Great. thank you. And about additional technology, s o-called tac k-in and bolts, what about public and private evaluation spreads? Is there still a chance to add to the second spectrum, such as a bet vision? Nick Taylor: Chad, Nick. I think we commented on some of them at the 3rd and 4th quarter financial results briefing. The third quarter of Europe overlapped with the fourth quarter of 2022 and slowed down a little. In other words, we are generally considered that US businesses generally expect a recycling crossover growth of 20 % per year, and European businesses are expected to grow 15 %. So the growth in Europe is very healthy.

Mark Rock: And I'm sorry for the macro story, but one of the European macros is very interesting now. In other words, although not as aggressive as the United States, there are shinse signs. In Belgium, online has progressed, and gambling over the age of 21 has been legalized. I think there are still many possibilities in the market.

Chad Baynon: Great. thank you. And about additional technology, s o-called tac k-in and bolts, what about public and private evaluation spreads? Is there still a chance to add to the second spectrum, such as a bet vision?

Mark Rock: Yes, that's a good question. As our business turned into a cash flow plus, as we continued to do it, our heads have clearly emphasized with potential and growth in the acquisition. One of the challenges we have is to be honest, we have a lot of skills. In other words, there are a lot of things you need depending on the second range, other acquisitions, and internal development. So you don't feel a gap on the technical stack. So, if you look at the M & Amp; A market, you should be quite convincing in some respects. It must be persuasive in that the technology is really indispensable, it can develop it well and create real profitability from it. Also, it is necessary to pay attention to the level of spin-off levels, their content, and how much this technology will be traded at the end-some of these technology companies are not. There is. And we feel very strong and we feel in a very good place. And we think we are looking at other parts of the market. However, if the price is really attractive, it will be difficult to justify the technology to provide.

Chad Baynon: Thank you for both. appreciate.

Administrator: The next question is from UBS's Robin Farley. please.

Robin Farily: Great. thank you. So is the NFL GGR. I think the NFL GGR is the same. Please tell me the ratio of the Impure to the NFL GGR. It's over 20 %. Last year and this term, I wanted to know what the percentage of Imprees in GGR had changed. thank you.

Nick Taylor: Robin, Nick. 20 % of NFL data was in the game. I think the annual GGR in the game increased 140 %. I think the profit margin was shouting in the prepared remarks, but the profit margin has increased in 23 years compared to 2022.

Robin Farley: Is the percentage of the transition from the game to the game increased yea r-o n-year among the NFL GGRs? Is it almost the same as the growth of the GGR of the entire NFL?