Wednesday, June 29, 2022
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DraftKings raises FY guidance as losses increase through Q1

DraftKings has detailed increased guidance for the current year, as the gaming and sports betting group reports that losses through the first quarter of the year have increased to $467.61m from $346.34m year-on-year.

Group-wide revenue during the three months to March 31, 2022, increased 34 per cent to $417m (2021: $312m), with the group’s B2C segment up 44 per cent to $404m.

However, adjusted EBITDA losses also swelled, with DraftKings reporting a widening of 107.88 per cent to $289.5m (2021: $139.26m).

Monthly unique players increase by 29 per cent to two million driven by retention across igaming and online sports betting, with average revenue per MUP closing at $67m. 

This represents an increase of 11 per cent that is attributable to strong customer engagement, a continued revenue mix shift in igaming and an increase in DFS activity, and partially offset by low hold rates and an increase in promotional intensity in newly launched states, primarily in New York.

“DraftKings delivered significant growth across our key revenue and performance metrics,” said Jason Robins, DraftKings’ co-founder, Chief Executive Officer and Chair of the Board. 

“We are not seeing any impact from inflationary pressures on customer demand, and we continue to improve the user experience by adding breadth and depth to our DFS, mobile sports betting and igaming products. 

“We are also improving our efficiency in acquiring and retaining customers and have a strong pipeline of new jurisdictions to enter.”

Furthermore, DraftKings has raised its revenue guidance for the year from $1.85bn-$2bn to $1.92bn-$2.02bn, which would equate to year-on-year growth of 49 per cent to 56 per cent. Expected adjusted EBITDA loss has also been lowered from $825m-$925m to $760m-$840m.

This, said DraftKings, does not include contribution from its newly acquired Golden Nugget Online Gaming, or an expected second quarter launch in Ontario.

This latter point is expected to contribute an additional $130m to $150min revenue and negative $50m to $70m in adjusted EBITDA.

Jason Park, DraftKings’ Chief Financial Officer, added: “We are pleased with our strong revenue and Adjusted EBITDA performance in the first quarter, which was driven by healthy underlying customer behaviour and our ability to capture efficiencies. 

Therefore, we are increasing the midpoint of our fiscal year 2022 revenue guidance by $50m and improving the midpoint of our fiscal year 2022 adjusted EBITDA guidance by $75m.”

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