Genius Sports Ltd 20-F Analysis & Summary – 3/14/2025

⚠️This is not investment advice.

⚠️ This is an experimental project and this report is for informational purposes only and should not be considered investment advice. Conduct your own thorough research and consult with a qualified financial advisor before making any investment decisions. ⚠️

Genius Sports Ltd

20-F

Annual report (foreign)

Filing date:

03/14/2025

TLDR:

ELI5:

Genius Sports makes money by providing data and tech to sports betting and media companies. They made more money this year than last year, but they still spent more than they earned, although they are getting closer to making a profit.

Accession #:

0000950170-25-039412

Published on

March 16, 2025

Analyst Summary

Total revenue increased by 24% from $412.977 million in 2023 to $510.894 million in 2024, with Betting Technology, Content and Services showing the largest growth at 29%.
The company reported a net loss of $63.040 million in 2024, an improvement from the $85.534 million loss in 2023, with gross profit increasing by 87%.
Operating expenses increased by 31% from $143.163 million in 2023 to $187.244 million in 2024, with a significant increase in general and administrative expenses.
Cash and cash equivalents increased from $100.331 million in 2023 to $110.213 million in 2024, with a significant increase in net cash from operations.
Gross Profit Margin improved significantly from 16.7% to 25.2%, suggesting better cost control or pricing strategies, but remains below typical software/data service margins.
Operating Profit Margin improved from -18.0% to -11.5%, indicating narrowing operating losses, but the company is still not operating at a profit.
Net Profit Margin improved from -20.7% to -12.3%, showing improving net losses, but the company is still far from achieving profitability.
Adjusted EBITDA increased significantly from $53.3 million in 2023 to $85.7 million in 2024, a 61% increase, reflecting better cost management and increased profitability from core operations.

Opportunities and Risks

Risk: The market for sports data and technology is competitive, and competitors may have greater resources.
Risk: Reliance on relationships with sports organizations for data and streaming rights; failure to renew or expand these relationships could negatively impact the business.
Risk: Changes in gambling regulations could adversely affect the company’s financial results.
Risk: The company’s information technology and infrastructure may be vulnerable to attacks or breaches.
Risk: Use of AI in products or services may result in operational challenges, legal liability, reputational concerns and competitive risks.
Opportunity: Continued growth in the global sports betting market, particularly in emerging markets like the US.
Opportunity: Development of new technology and services for sports, sportsbooks, advertisers, and broadcasters.
Opportunity: Developing high-ROI strategic partnerships around sports data and video rights.
Opportunity: Accelerating the growth of sports advertising and fan engagement solutions.

Potential Implications

Company Performance

Continued revenue growth is expected due to the expanding sports betting market and new technology development.
The company needs to focus on achieving profitability by managing operating expenses, particularly general and administrative costs.
Securing and renewing key data rights agreements is crucial for maintaining a competitive edge.
The company’s ability to adapt to regulatory changes in the gambling industry will impact its financial results.

Stock Price

Positive investor sentiment may arise from revenue growth and improved gross profit margins.
Concerns about the company’s continued net losses and increasing operating expenses could negatively impact the stock price.
Successful strategic partnerships and technological innovations may drive positive stock performance.
A low Price-to-Book Ratio (P/B) and Price-to-Sales Ratio (P/S) may indicate undervaluation, but requires further investigation.

Executive Summary

This report analyzes Genius Sports Ltd’s 20-F filing for the fiscal year ended December 31, 2024. Key findings include revenue growth driven by Betting Technology, Content and Services, and Media Technology, Content and Services. However, the company continues to report a net loss. The report identifies risks related to competition, data rights, and regulatory changes. Further analysis is needed to determine a definitive investment recommendation.

Company Overview

Genius Sports Ltd. is a B2B provider of technology and data services to the sports, sports betting, and sports media industries. The company aims to be the official data, technology, and commercial partner connecting sports, betting, and media globally. The filing indicates a focus on expanding its product offerings and geographic reach.

Financial Statement Analysis

Revenue

Total revenue increased by 24% from $412.977 million in 2023 to $510.894 million in 2024.

Revenue Stream	2024 (USD Millions)	2023 (USD Millions)	Change
Betting Technology, Content and Services	354.856	274.235	+29%
Media Technology, Content and Services	105.313	91.605	+15%
Sports Technology and Services	50.725	47.137	+8%

The largest revenue growth was in Betting Technology, Content and Services, indicating strong demand for their betting-related products.

Profitability

The company reported a net loss of $63.040 million in 2024, an improvement from the $85.534 million loss in 2023.

Metric	2024 (USD Millions)	2023 (USD Millions)	Change
Net Loss	(63.040)	(85.534)	+26%
Gross Profit	128.707	69.005	+87%

While the net loss improved, the company is still not profitable. The significant increase in gross profit suggests improved operational efficiency.

Expenses

Operating expenses increased by 31% from $143.163 million in 2023 to $187.244 million in 2024.

Expense Category	2024 (USD Millions)	2023 (USD Millions)	Change
Sales and Marketing	37.411	29.432	+27%
Research and Development	24.576	26.070	-6%
General and Administrative	123.011	85.167	+44%

The increase in general and administrative expenses is significant and warrants further investigation. The decrease in R&D spending could impact future innovation.

Liquidity and Capital Resources

The company’s cash and cash equivalents increased from $100.331 million in 2023 to $110.213 million in 2024.

Metric	2024 (USD Millions)	2023 (USD Millions)	Change
Cash and Cash Equivalents	110.213	100.331	+10%
Net Cash from Operations	81.861	14.876	Significant Increase

The increase in cash from operations is a positive sign. The company also has access to a credit facility.

Risk & Opportunity Assessment

Risks

Competition: The market for sports data and technology is competitive. Competitors may have greater resources.
Data Rights: Reliance on relationships with sports organizations for data and streaming rights. Failure to renew or expand these relationships could negatively impact the business.
Regulatory Changes: Changes in gambling regulations could adversely affect the company’s financial results.
Cybersecurity: The company’s information technology and infrastructure may be vulnerable to attacks or breaches.
AI: Use of AI in products or services may result in operational challenges, legal liability, reputational concerns and competitive risks.

Opportunities

Growth in Sports Betting: Continued growth in the global sports betting market, particularly in emerging markets like the US.
New Technology and Services: Development of new technology and services for sports, sportsbooks, advertisers, and broadcasters.
Strategic Partnerships: Developing high-ROI strategic partnerships around sports data and video rights.
Fan Engagement: Accelerating the growth of sports advertising and fan engagement solutions.

Conclusion & Actionable Insights

Genius Sports is experiencing revenue growth, particularly in its core betting-related services. However, the company is still operating at a loss, and operating expenses are increasing. Key risks include competition and reliance on data rights. Opportunities exist in the expanding sports betting market and through technological innovation.

Recommendations:

Monitor the company’s ability to achieve profitability and manage operating expenses.
Assess the company’s success in securing and renewing key data rights agreements.
Evaluate the impact of regulatory changes on the company’s business model.
Further investigate the increase in general and administrative expenses.

Financial Analysis of Genius Sports Limited (GENI) – 2024

1. Commentary

Genius Sports Limited demonstrates strong revenue growth in 2024, driven primarily by its Betting Technology, Content and Services segment. While the company still reports a net loss, it has significantly decreased compared to the previous year, indicating improved operational efficiency. Adjusted EBITDA also shows substantial growth, reflecting better cost management and increased profitability from core operations. However, high operating expenses, particularly in general and administrative costs, continue to weigh on overall profitability, and the company’s accumulated deficit remains substantial.

2. Financial Ratio and Metric Analysis

Profitability

Metric	2024	2023	Trend	Industry Benchmark	Commentary
Gross Profit Margin	25.2%	16.7%	8.5%	~50-70% (Software/Data Services)	Significant improvement in gross profit margin suggests better cost control or pricing strategies. Still below typical software/data service margins.
Operating Profit Margin	-11.5%	-18.0%	6.5%	~10-20% (Mature Tech Companies)	Operating losses are narrowing, but the company is still not operating at a profit.
Net Profit Margin	-12.3%	-20.7%	8.4%	~5-15% (Profitable Tech Companies)	Net losses are improving, but the company is still far from achieving profitability.
Return on Assets (ROA)	-7.9%	-11.0%	3.1%	~5-10% (Average for Tech Sector)	ROA is negative, reflecting the net loss. Improvement indicates better asset utilization, but still needs significant improvement.
Return on Equity (ROE)	-11.0%	-14.9%	3.9%	~15-25% (Good for Tech Sector)	ROE is negative, reflecting the net loss and accumulated deficit. Improvement is needed to generate returns for shareholders.
EPS (Basic and Diluted)	$(0.27)	$(0.38)	0.11	Varies widely	EPS improved, reflecting the reduced net loss.

Liquidity

Metric	2024	2023	Trend	Industry Benchmark	Commentary
Current Ratio	1.43	1.34	0.09	1.5-2.0 (Generally Healthy)	Slight improvement in the current ratio indicates better short-term liquidity.
Quick Ratio (Acid-Test Ratio)	1.01	0.94	0.07	1.0 or Higher (Desirable)	The quick ratio is around 1, indicating the company can cover its current liabilities with its most liquid assets.
Cash Ratio	0.55	0.55	0.00	0.2-0.4 (Conservative)	The cash ratio is relatively high, indicating a strong ability to meet short-term obligations with cash and equivalents.

Solvency/Leverage

Metric	2024	2023	Trend	Industry Benchmark	Commentary
Debt-to-Equity Ratio	0.38	0.35	0.03	0.5-1.0 (Acceptable for Growth Companies)	The debt-to-equity ratio is relatively low, indicating a conservative capital structure.
Debt-to-Assets Ratio	0.0002	0.01	-0.01	Varies by Industry	The debt-to-assets ratio is very low, indicating a small portion of assets are financed by debt.
Interest Coverage Ratio (Times Interest Earned)	N/A (Interest Income)	N/A (Interest Income)	N/A	5.0 or Higher (Generally Safe)	The company has net interest income, so the interest coverage ratio is not applicable.

Activity/Efficiency

Metric	2024	2023	Trend	Industry Benchmark	Commentary
Inventory Turnover	N/A	N/A	N/A	N/A	Not particularly relevant for this type of company.
Days Sales Outstanding (DSO)	61.1	62.7	-1.6	40-60 (Target for Efficiency)	DSO is slightly high, indicating it takes a bit longer to collect revenue from sales.
Days Payable Outstanding (DPO)	35.0	60.7	-25.7	30-45 (Typical Range)	DPO decreased significantly, indicating the company is paying its suppliers much faster.
Asset Turnover	0.65	0.53	0.12	0.5-1.0 (Typical Range)	Asset turnover is improving, indicating the company is generating more revenue per dollar of assets.

Valuation

Metric	2024	Commentary
Price-to-Earnings Ratio (P/E)	N/A (Negative Earnings)	Not applicable due to negative earnings.
Price-to-Book Ratio (P/B)	0.34	Calculated as Market Cap ($195.8M) / Book Value of Equity ($572.4M). A low P/B ratio may indicate undervaluation, but requires further investigation.
Price-to-Sales Ratio (P/S)	0.38	Calculated as Market Cap ($195.8M) / Revenue ($510.9M). A low P/S ratio may indicate undervaluation, but requires further investigation.
Enterprise Value to EBITDA (EV/EBITDA)	2.28	Calculated as (Market Cap + Debt – Cash) / EBITDA. EV = 195.8 + 19 – 135.2 = 79.6. EV/EBITDA = 79.6 / 85.7 = 0.93. A low EV/EBITDA ratio may indicate undervaluation, but requires further investigation.

Growth Rates

Metric	2024	Commentary
Revenue Growth	23.7%	Calculated as (510.9 – 413.0) / 413.0. Strong revenue growth indicates increasing market demand.
Net Income Growth	26.3%	Calculated as (85.5 – 63.0) / 85.5. Significant improvement in net income, although still negative.
EPS Growth	28.9%	Calculated as (0.38 – 0.27) / 0.38. Reflects the improvement in net income.

Other Relevant Metrics

Adjusted EBITDA: The company highlights Adjusted EBITDA as a key performance indicator. It is calculated by adding back net interest (income) expense, income tax expense, amortization of acquired intangibles, other depreciation and amortization, stock-based compensation, transaction expenses, litigation and related costs, change in fair value of derivative warrant liabilities, (gain) loss on fair value remeasurement of contingent consideration, loss on abandonment of assets, loss (gain) on foreign currency, and other to net loss. This metric is used to show the underlying profitability of the business, excluding non-cash and non-recurring items. Adjusted EBITDA increased significantly from $53.3 million in 2023 to $85.7 million in 2024, a 61% increase. While Adjusted EBITDA provides a clearer picture of operational performance, it’s important to remember that it is a non-GAAP measure and should be viewed in conjunction with GAAP results.