Rush Street Interactive (RSI) Q4 2025: Online Casino MAUs Surge 51%, Unlocking Operating Leverage
RSI’s Q4 delivered record-breaking growth and margin expansion, driven by its casino-first strategy and robust user acquisition across North America and Latin America. Operational discipline, strategic tax navigation in Colombia, and a pipeline of new market entries—including a near-term Alberta launch—signal continued upside. The company’s evolving product roadmap and focus on differentiated content set the stage for further competitive separation in 2026.
Summary
- Casino-First Model Drives Share Gains: Focus on online casino yielded standout user and revenue growth without new markets.
- Colombia Tax Headwinds Navigated: Strategic bonusing absorbed VAT impact, preserving engagement and positioning for recovery.
- Alberta and Content Pipeline Add Optionality: Upcoming launches and proprietary games expected to unlock further growth.
Performance Analysis
Rush Street Interactive’s Q4 capped an exceptional year of broad-based growth, with revenue reaching a record high and adjusted EBITDA expanding at a faster rate than sales. The company’s North American online casino segment was the primary engine, with monthly active users (MAUs) up 51%—the second highest quarterly growth in four and a half years—despite no new market launches. Latin America also posted resilient results, with MAUs up 47%, even as Colombia’s temporary VAT tax weighed on reported revenue.
Margin expansion was achieved through disciplined marketing and operational efficiency. Marketing spend as a percentage of revenue fell by 290 basis points year-over-year, while general and administrative expenses (G&A) also declined as a share of revenue. Despite near-term ARPMAU (average revenue per monthly active user) compression from onboarding new cohorts and the impact of Colombia’s bonusing, RSI maintained profitability and generated substantial cash flow, ending the year with $336 million in cash even after share repurchases.
- Casino User Growth Outpaces Industry: North American iCasino MAUs rose 51%, with total North America MAUs up 37%.
- LatAm Resilience Amid Tax Shifts: Colombia’s GGR (gross gaming revenue) grew 66%, and MAUs climbed 34%, despite VAT-driven bonusing costs.
- Cost Discipline Underpins Margin Gains: Marketing and G&A leverage contributed to a 66% increase in adjusted EBITDA, outpacing top-line growth.
RSI’s ability to grow both user base and profitability—while absorbing regulatory shocks—underscores the scalability and resilience of its business model.
Executive Commentary
"Our exceptional performance is a product of our intense focus on our customers and the cumulative improvements we've made across every aspect of our business."
Richard Schwartz, Chief Executive Officer
"Our cost to acquire players are the lowest they've been since before we went public...our teams are doing a fantastic job in bringing in new players, making sure they know what the product is about, and then putting a great product in front of them when they show up."
Kyle Sowers, President and Chief Financial Officer
Strategic Positioning
1. Casino-First Focus Yields Differentiation
RSI’s commitment to a “casino-first” strategy—prioritizing online casino over sports betting—has driven superior player retention and monetization. Casino players typically offer higher lifetime value and engagement, and RSI has invested in proprietary content and platform enhancements to further differentiate its offering. The company plans to expand its in-house game studio and launch exclusive titles in 2026, reinforcing this competitive moat.
2. Regulatory Agility in Latin America
RSI demonstrated regulatory agility in Colombia, absorbing VAT costs through bonusing rather than passing them to players, which preserved engagement and loyalty. With the VAT on deposits now expired and a less punitive revenue tax regime (currently suspended pending review), RSI is positioned to capitalize on market share gains and a rebound in ARPMAU as bonusing normalizes.
3. Operational Leverage and Marketing Efficiency
Disciplined marketing spend and operational improvements have delivered operating leverage, with acquisition costs at multi-year lows and G&A growing in line with revenue. RSI’s approach to player acquisition—optimizing channels, creative, and user experience—has enabled record first-time depositors and high reactivation rates, supporting sustainable growth.
4. Strategic Market Expansion
Alberta’s impending launch offers a near-term catalyst, with RSI’s track record of profitability in new North American casino markets suggesting rapid ramp potential. The company’s selective approach to new markets, focusing on jurisdictions where it can deploy its full suite of products, has yielded strong returns and minimized risk.
5. Product Innovation and Ecosystem Development
RSI is investing in proprietary content and poker liquidity, aiming to deepen engagement and cross-sell opportunities. Its Poker Night America brand and TV platform complement the casino ecosystem, while ongoing investment in differentiated content is expected to drive further user stickiness.
Key Considerations
This quarter’s results reflect a business firing on all cylinders, but investors should weigh several strategic levers and watchpoints as RSI scales:
Key Considerations:
- Tax Environment Evolution: Regulatory clarity in Colombia and other LatAm markets will impact margin and growth trajectory.
- Content Investment Payoff: Success of proprietary casino content launches will be key to sustaining differentiation and user engagement.
- Alberta and New Market Ramp: The speed and efficacy of Alberta’s rollout could set the tone for further Canadian expansion.
- Prediction Market Disruption: Ongoing industry shifts toward prediction markets could impact user acquisition dynamics and cross-sell opportunities.
Risks
RSI faces ongoing regulatory volatility, especially in Latin America, where tax regimes can shift rapidly and impact profitability. Competitive intensity remains high, with larger peers and prediction market entrants vying for share. ARPMAU dilution from new user cohorts could persist if acquisition outpaces monetization, and success in Alberta or new states is not guaranteed. Management’s guidance assumes prudent but optimistic scenarios, and any adverse regulatory or market developments could pressure results.
Forward Outlook
For Q1 2026, RSI guided to:
- Continued sequential revenue and EBITDA growth, with improvement expected as the year progresses.
- Marketing investments to increase, but at a slower pace than revenue, supporting further operating leverage.
For full-year 2026, management raised guidance:
- Revenue of $1.375 billion to $1.425 billion (21% to 26% YoY growth)
- Adjusted EBITDA of $210 million to $230 million (37% to 50% YoY growth)
Management highlighted several factors that support this outlook:
- Normalization of Colombia’s tax environment and removal of bonusing headwinds
- Potential Alberta launch and new proprietary casino content as upside drivers
Takeaways
RSI’s Q4 and FY25 results showcase a business with scalable operating leverage, a differentiated casino-first model, and a proven ability to navigate regulatory and competitive headwinds.
- Casino-First Execution Delivers: Strategic focus on iCasino drove outsized user and revenue growth, fueling margin expansion and cash generation.
- Regulatory Agility Proved Critical: Colombia’s tax navigation preserved user engagement and sets up for ARPMAU and margin recovery in 2026.
- Pipeline Upside Remains: Alberta launch, proprietary content, and further LatAm expansion offer optionality for continued outperformance.
Conclusion
Rush Street Interactive’s record year was defined by its ability to scale profitably, adapt to complex regulatory environments, and double down on its casino-first strategy. With a robust balance sheet, a clear product roadmap, and disciplined operational execution, RSI is positioned to extend its leadership in 2026 and beyond.
Industry Read-Through
RSI’s results highlight the growing importance of online casino as the sector’s most attractive vertical, with higher user value and stickiness compared to sports betting. The company’s successful navigation of regulatory headwinds in Colombia offers a blueprint for operators facing similar volatility in emerging markets. The ongoing rise of prediction markets and proprietary content investment points to a more fragmented but innovation-driven competitive landscape, with regulatory agility and differentiated user experience as critical success factors. Other operators should note RSI’s disciplined market entry and operational focus as key to sustainable growth in a maturing industry.