The gaming landscape has seen a formidable player in NorthStar Gaming solidifying its position through strategic content and acquisition moves, as evidenced by its latest financial report for the third quarter. NorthStar’s distinctive ‘Insights’ content, offering players expert advice and betting guidance, has notably achieved a marked increase in player engagement. Users who accessed this content registered on average 40% more in deposits than those who did not, underscoring the content’s value in driving revenue for the company.
Further bolstering NorthStar’s financial successes is their earlier acquisition of Slapshot Media, a company that provides marketing and operational management services specifically tailored to sports betting and igaming operators. During the third quarter alone, Slapshot generated $200,000 in revenue from managed services. This strategic move appears to pay dividends as NorthStar leverages Slapshot’s expertise to expand its operational footprint.
Expansion efforts have been robust since NorthStar’s initial launch in Ontario in May 2022, with the company recently rolling out NorthStarBets.com to include all provinces and territories in Canada. This ambitious move suggests a clear strategy to capture a wider national market share in the competitive gaming sector.
NorthStar CEO, Michael Moskowitz, reflected positively on the company’s performance, particularly noting its substantial growth during what is traditionally a slower season for betting. He expressed confidence in the potential for further growth in the fourth quarter and beyond. Moskowitz credited the company’s growth to the appeal of NorthStar’s premium product offerings and effective cost management strategies.
The company’s financials reveal a dramatic increase of 125.0% in gaming revenue, reaching $4.5 million for the quarter ending September 30th. The impact of the Slapshot Media deal, which was only finalized in 2023, is evident as there were no comparable figures from the previous year. Total wagers on NorthStarBets.com rose to a staggering $138.0 million, marking a 139.6% year-over-year increase, which contributed significantly to the company’s revenue surge during Q3.
In terms of expenditure, NorthStar reported increased costs in service provider and operator participant fees, which align with the enhancement of their offerings. Conversely, marketing costs were cut down by a substantial 55.8% to $2.0 million, aiding a total expense reduction of 9.4% to $5.8 million.
Despite these substantial revenues, the company also reported a net loss of $4.2 million for Q3, an improvement over the previous year’s $6.1 million loss. Gross gaming revenues year-to-date showed an impressive 420.0% increase, topping off at $13.0 million, including the significant contribution from Slapshot Media’s managed services.
While costs rose in certain areas, such as provider fees and public listing costs, marketing expenses decreased, leading to a net year-to-date loss of $18.0 million, which was wider than the $13.6 million loss in the same period of the previous year.
Moskowitz optimistically pointed to NorthStar’s strengthened balance sheet, strategic partnerships, ongoing product innovation, and brand development across Canada as indicators for continued growth through the rest of the year and into the next.
The publication of these financial results coincided with an announcement from NorthStar regarding the departure of their Chief Financial Officer, Jennifer Barber, who will be leaving on December 1st to pursue another opportunity. Having held the position since June 2022, she will be succeeded by Chin Dhushenthen, the current Vice-President of Finance and Compliance, who will step in as the interim CFO.
NorthStar’s recent financial performance and strategic moves depict a company that is not only navigating but also shaping the competitive gaming sector landscape. With its innovative content, strategic acquisitions, and national expansion, NorthStar Gaming is on a clear path to achieveits aspirations for continued growth and success in the industry.
