Genius Sports Beats Q2 Revenue Expectations; Shares Leap

Genius Sports Limited (GENI) delivered blowout second-quarter revenues driven by robust performances across all segments and increased its revenues guidance range for FY2021.

Shares rose 4.6% on September 8 to close at $22.27 and jumped another 6.7% in the extended trading session after the earnings call.

Notably, shares of the sports data and technology company that provides data management, video streaming, and integrity services to sports leagues, bookmakers, and media companies have gained 12.6% since its IPO in April this year. (See Genius Sports stock charts on TipRanks)

Revenues more than doubled year-over-year to $55.8 million and exceeded consensus estimates of $53.5 million. The 108% increase in revenues reflected a surge in Betting Technology, Content & Services revenues, which increased 122% to $40.7 million, a 105% growth in Sports Technology & Services revenues to $7.2 million, as well as a 62% increase in Media Technology, Content & Services revenues to $8.0 million.

Further, adjusted EBITDA jumped 126% year-over-year to $5.2 million, leading to an adjusted EBITDA margin improvement of 70 bps to 9.3%

On the negative side, the company posted a net loss per share of $3.08, falling significantly short of analysts’ expectations of a loss of $0.25 per share. Further, the loss was much larger than the reported loss of $0.11 per share in the prior-year period.

Concurrent with the earnings results, Genius Sports also announced that the Arizona Department of Gaming has granted a temporary event wagering supplier license enabling the company to operate in 16 U.S. states.

Q2 was a landmark quarter for the company as it accelerated its technological capabilities and long-term growth potential with the acquisitions of Spirable, Second Spectrum, and FanHub.

The company also inked several key partnerships agreements with DraftKings, Caesars, WynnBET, and 888 SI Sportsbook to provide comprehensive official sportsbook data and content, which also includes a complete range of NFL-related products.

Based on robust Q2 results, management raised the revenue guidance for FY2021 slightly. The company now forecasts revenues to be in the range of $255 to $260 million, versus the prior guidance range of $250 to $260 million.

Further, the company expects adjusted EBITDA to range between $10 and $20 million.

Genius Sports CEO Mark Locke commented. “We continue to significantly expand our leading portfolio of official rights by partnering with sports leagues and federations in key regions across the globe.”

He further added, “Our recently announced NFL-related agreements with sportsbook operators have validated our strategy and instilled confidence in our ability to deliver results at the high end of our previous guidance for the year.”

Following the upbeat Q2 results, Needham analyst Bernie McTernan reiterated a Buy rating on the stock and a price target of $29 (30.2% upside potential).

Consensus among analysts is a Strong Buy based on 3 unanimous Buys. The average Genius Sports price target of $30 implies 34.7% upside potential to current levels.

TipRanks data shows that financial blogger opinions are 100% Bullish on GENI, compared to a sector average of 71%.