Data and analytics provider Genius Sports reported better-than-expected revenue of $95.5 million in the second quarter of 2024, and it told Wall Street it expects 20% annual growth for the foreseeable future, thanks to NFL data exclusive, perennial rights. and the English Premier League.
“With our focus on execution over the last few years, we’re really looking to drive both revenue and margin growth going forward, so we feel good about that,” said Genius Founder and CEO Mark Locke. call with analysts on Tuesday. “We have everything on the right side. We have probably the two most important global rights blocked for a really long time.”
Genius Sports has exclusive rights to UK football until 2029, while it holds rights for the NFL, one of its biggest shareholders, until 2028.
In the quarter ending June 30, which is usually Genius’ most predictable given the seasonal decline in U.S. sports betting, the company’s sales figure narrowly beat Wall Street’s consensus. The business missed expectations for a net loss of nine cents per share, compared with an average of 13 analysts expecting a loss of three cents, according to data compiled by S&P Global Market Intelligence. On the front line, Genius’ sports betting segment posted sales growth of 18% to $67.1 million in its largest operating unit, while two other divisions, media and sports technology, saw sales decline.
Despite the mixed results compared to expectations, Wall Street seemed buoyed by Genius’ forecast, sending shares up more than 7% to $6.43 in the first hour of trading on Tuesday. Genius raised its forecast for full-year sales to $510 million, compared to analysts’ expectations of about $500 million, while saying it expects an expansion in its gross profit and positive cash flow in 2024.
In the long term, the company said its focus on technology continues to allow it to expand its product offerings for customers and partners, which underpins the expected growth. For example, the extension of Genius’ data rights to the top divisions of English and Scottish football included the recent launch of the English Football League’s first fantasy app covering divisions below the Premier League. The company says the EFL fantasy app is the top download in Apple’s UK app store and the second most popular free app in the country.
For most sports betting data providers, including Genius, as publicly traded entities, the value of official data rights has long been the focus of skeptical investors. Without elaborating on price expectations, Locke suggested that the competitive field for sports data rights has narrowed to essentially two players, Genius and Sportradar, suggesting that pricing pressure on rights acquisitions and renewals in the future should ease with fewer bidders.
“As we sit here today, all major global data rights are owned by just the two largest players for the balance of the decade. It wasn’t like that a few years ago,” said Locke. “We expect to reduce competitive tensions, which should support a more stable and predictable operating landscape.”