- Third quarter revenues up 57%
- Losses smaller than forecast
- Full-year guidance increased
Shares in US fantasy sports betting firm DraftKings (DKNG:NASDAQ) were up 7% in pre-market trading after third-quarter sales and earnings beat estimates and full-year guidance was raised.
The shares have surged 162% so far this year compared with a 28% gain for the Nasdaq Composite.
The upbeat results gave a boost to FTSE 100 gambling companies Entain (ENT) and Flutter Entertainment (FLTR) with their shares rising 4% and 3% respectively in early trading.
Flutter owns US fantasy sports betting business FanDuel, while Entain operates in the US through its 50/50 joint venture with BetMGM.
The positive read-across is welcome news for investors after both firms downgraded their full-year guidance following weaker than expected third quarter trading.
HOW DID DRAFTKINGS PERFORM?
Sales for the three months to 30 September increased 57% year-over-year to $790 million, some 12% ahead of analysts’ estimates.
Meanwhile adjusted net losses reduced to $0.35 per share compared with $1 loss per share in the same period last year and Wall Street estimates of $0.69 per share.
Chief executive Jason Robins said: ‘Our fantastic third quarter results demonstrate the positive impact of our product and technology investments as well as excellent preparation and execution by our entire organization.
‘Our new and differentiated features and functionality have created an exceptional user experience that sustains engagement for our mobile sports betting and iGaming customers.’
The sports betting company added 650,000 monthly unique customers in the quarter, up 40% on the prior year, while average revenue per customer increased 14% to $114.
DraftKings moved ahead of archrival FanDuel last month to become the market leader in the US online gambling market according to market research firm Eilers & Krejcik.
RAISED GUIDANCE
The company raised its 2023 revenue outlook to between $3.67 billion and $3.72 billion from a prior forecast of $3.46 billion to $3.54 billion, an upgrade of 6% at the midpoint.
According to LSEG data, consensus forecasts put this year's revenue at $3.54 billion, meaning today's guidance should generate further upgrades.
DraftKings also increased its forecast for EBITDA (earnings before interest, taxes, depreciation and amortisation) to a loss of between $95 million and $115 million from $190 million to $220 million previously.
