NorthStar Gaming takes quarterly record revenue in Q4 2023

Company reports revenue growth of 103% YOY in Q4

Toronto-based NorthStar Gaming reported a 103% year-over-year increase in Q4 revenue as it unveiled the financial results for its first full year of operations.

NorthStar took total revenue of $6.5 million in the three months ended Dec. 31, 2023, a quarterly record for the company and more than double the $3.2 million it took in the same period of 2022. Gross gaming revenue for the company’s NorthStar Bets wagering platform in Q4 2023 was $7.6 million, up 85% YOY. Total handle for the betting platform rose 90% in the same period, to $213.3 million.

Given that NorthStar only launched in mid-May 2022 in Ontario, the 12-month period covered by this week’s financial report was its first full year of operations. While revenue was up 240% in 2023 compared to 2022, that period is nearly twice as long as the previous year.

However, NorthStar made $19.4 million in 12 months in 2023 compared to $5.7 million in seven and a half months of 2022. Extrapolating that latter figure to span the whole of 2022 would take the hypothetical Y1 revenue figure to around $9 million, which would represent an increase of more than 100% in Y2.

NorthStar Bets’ handle for 2023 was $648.8 million in 2023, up 251% compared to the $184.7 million in bets during the 2022 operating period. GGR for the betting site was up 208% to $22.5 million in 2023 and gross margin was $7.1 million in 2023, an increase of 492% over $1.2 million in 2022. That margin represented approximately 36% of revenue last year compared to 21% of revenue in 2022.

Though the business reported a net loss of $25.5 million during its first full year. CEO Michael Moskowitz noted in a letter to shareholders that the company has now posted six successive quarters of growth in both customers and revenue.

“We delivered very strong growth in our first full year of operations, with revenue and customers increasing sequentially in every quarter,” said Moskowitz. “Key accomplishments during the year included the public listing of our shares, numerous product innovations to enhance our online betting platform, a strengthening of strategic partnerships, implementation of a marketing plan that has yielded an excellent return on investment, and the Slapshot Media acquisition which has enabled us to expand our addressable market through a First Nations-managed services arrangement.”

Year of progress for NorthStar

In its year-end reporting, NorthStar pointed to a year of progress across numerous verticals.

As well as exceeding the $1 billion mark in total wagers since NorthStar Bets’ launch, the company also introduce branded studios for select live dealer games last year. In the first months of 2024, NorthStar surpassed 600 casino games covering all major categories and curated from renowned vendors worldwide. It also revamped its Sports Insights department, which produces a variety of sports and betting content featured on major Canadian media platforms such as the Toronto Star, and launched a VIP Rewards program.

Notably, the company, which listed on the Toronto Stock Exchange in March 2023, also commenced trading on the U.S.-based OTCQB Venture Market in March this year.

The year-end results were published just a few days after NorthStar announced it extended its strategic partnership with Playtech through a renewal of the pair’s existing marketing agreement. Playtech will also provide another $3 million worth of short-term financing, the proceeds of which NorthStar says will be used to fund the company’s continued growth as well as for general corporate purposes.

In his letter to shareholders, Moskowitz credited that partnership with “giving us access to some of the world’s premier gambling technology and marketing services.”

Ultimately, Moskowitz said NorthStar is well-positioned to capitalize on its momentum, adding that “as we scale the business, we expect to realize operating leverage as revenue continues to grow faster than expenses.”

“NorthStar is a rapidly growing company in a relatively new sector with a lot of runway ahead,” he told shareholders. “We have a differentiated offering and, as a locally-based company, a distinct familiarity with the Canadian market. We are small and nimble enough to introduce innovation to our platform, while at the same time having access to world-leading technology and services through our committed partners. Our business model is gaining traction and has the potential to deliver strong returns.”

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