Lottery.com reported revenue of $6.7m (£5.3m/€6.1m) for the full year ended December 31, 2022, down 58.6% from 2021.
This is a far cry from Lottery.com’s full-year 2021 revenue growth, which rose 813.3% compared to Covid-19-hit 2020.
The year had been turbulent for the operator, with several management reshuffles and legal problems. In March, Lottery.com changed its leadership team, starting a trend that would continue throughout the year.
In July, Ryan Dickinson, chief financial officer, treasurer and president of Lottery.com, was “terminated” from his employment after the company admitted that it had overstated its cash balance by $30 million. Also in July, Lottery.com CEO Lawrence DiMatteo resigned and the company said it owed its employees $425,000 in outstanding wage and salary liabilities.
In August, Lottery.com was warned of a delisting from the US Nasdaq stock exchange after the company failed to file its Q2 report on time.
September brought further problems with employees. During the month, two board members resigned after saying Lottery.com had failed to address “red flags” allegedly raised by a new Lottery.com investor.
Days later, the company was given a deadline of October 5 to fill all remaining seats, which it met with the additional appointment of a new CEO, Sohail S Quraeshi.
The company later appointed new auditors in October.
In November, Lottery.com Chairman Richard Kivel resigned from his position, claiming that Lottery.com fostered a difficult work environment and adding that Chief Compliance Officer Dennis Ruggeri was facing an FBI investigation. Days later, a new chairman was appointed.
In December, Lottery.com received another warning from Nasdaq for late filing of its quarterly results – this time for the third quarter. The year ended with another Lottery.com director leaving the company after less than two months.
Financial results
Lottery.com’s cost of revenue for the year was $4.3 million, down 47.1% year-over-year. This brought gross revenue for the year to $2.4 million, a significant decline of 70.0% per year.
Total operating expenses for the year were $58.2 million, another loss of 70.0% year-over-year. These consisted of personnel costs of $37.1 million, general administrative fees of $8.9 million, professional fees of $6.6 million and depreciation of $5. 6 million US dollars together.
The expenses brought its operating loss to $55.7 million for the year, up $25.9 million from 2021.
Other expenses, consisting of interest, reserve losses on prepaid advertising credits and other expenses, totaled $4.4 million. This brought the pre-tax loss to $60.2 million.
After income tax expense of $104,356, total net loss for the year was $60.3 million, up 14.1% from 2021.