Shares of the sports technology firm dropped 28% to $6.16 in midday trading, extending a difficult year for the stock, which has now lost roughly a third of its value over the last 12 months. The volatility follows the decision to pivot toward a more aggressive expansion strategy by absorbing the gaming-media specialist.

Financing the Expansion

Under the terms of the agreement, Genius will provide an initial payment of $800 million in cash and $100 million in stock. An additional $300 million is tied to performance milestones over the next two years. To bankroll the purchase, the company plans to secure an $850 million term loan, a move that significantly increases its leverage according to the deal's financial disclosures.

Despite the immediate market skepticism, management projects the combined entity will reach a pro forma revenue of $1.1 billion by 2026. Adjusted EBITDA is forecasted to land between $320 million and $330 million. The deal, which remains subject to regulatory approval, is expected to close during the second quarter of this year.