Rush Street Beats Q3 Profit Forecasts But Slower Growth Tests Outlook

The BetRivers operator recorded a 73% adjusted EBITDA increase, yet missed revenue expectations for the first time in four years.

Rush Street Interactive grew profit 73% in the third quarter but missed sales forecasts for the first time in four years, exposing a North American iGaming slowdown that Latin American growth could not conceal.

Revenue rose 39% year over year to $385.9 million, below the approximately $388 million consensus cited by Citizens JMP. Adjusted EBITDA, a non-GAAP measure, increased to $62.2 million from $36 million, beating the $55 million consensus by 13%. GAAP net income rose 93% to $28.7 million, according to the company’s third-quarter results.

Casino Growth Slows as Latin America Accelerates

Online casino generated 75% of revenue and grew 32%, while online sports betting revenue rose 70%, CFO Kyle Sauers said on the third-quarter earnings call. North American revenue increased 14%, against 218% growth in Latin America.

North American monthly active users rose 34% to 300,572, but revenue per monthly active user fell 15% to $309.

“Online casino growth did moderate a little bit in Q3,” Sauers said. CEO Richard Schwartz described the slowdown as industry-wide, saying the moderation “has been broad-based rather than concentrated in any one segment of players.”

Other analysts probed the slowdown. Craig-Hallum’s Ryan Sigdahl said industry growth had “certainly decelerated after years and years and years” of consistency, while Stifel’s Jeff Stantial asked Sauers to “confirm for us the $4.3 million one-time gain in G&A.”

Sauers confirmed the foreign-exchange gain. Citizens analysts Jordan Bender and Isabelle Slavin calculated that, excluding that gain, the EBITDA beat narrowed from 13% to about 6%. In their Oct. 29 note, they called the quarter the company’s “first revenue miss in four years.”

Management Holds Guidance but Sees Less Revenue Headroom

Rush Street kept 2026 guidance of $1.56 billion to $1.6 billion in revenue and $245 million to $265 million in adjusted EBITDA. Sauers said October trends “would put us closer to the low end of revenue guidance,” while EBITDA was tracking near the midpoint.

Citizens said it was the first time since early 2025 that guidance was not raised at the midpoint.

Quarterly revenue growth slowed to 39% from 46% in the second quarter. Adjusted gross margin still improved 240 basis points to 36.4%, and the company ended September with $382 million in cash and no debt.

Colombia Tax Relief Could Offset a Tougher 2027

Management said Colombia’s 2027 budget omitted a new gaming tax, so the temporary 16% excise levy imposed by emergency decree is scheduled to expire at year-end, with the rate expected to revert to 15% absent further legislative change.

Analysts differ on the relief’s value. Citizens estimated that no further tax increase could add about $40 million to 2027 EBITDA. Stifel, which cut its price target to $30 from $34 in an Oct. 26 note, estimated the levy’s expiry could add more than $50 million to its 2027 and 2028 adjusted EBITDA estimates.

Citizens retained Market Outperform but cut its price target to $24 from $34 as growth estimates eased. That is a sharp turn from April, when Rush Street delivered blowout revenue in its Q1 2026 results.

Investors will now need evidence that North American casino demand is stabilizing before treating the profit beat as an all-clear.

Q3 2026 Results Highlights

Sources: RSI Q3 release; Citizens JMP (Oct. 29). Adjusted EBITDA is non-GAAP; net income is GAAP.

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