DraftKings posted second-quarter earnings results that showed increased presence within the online betting space, a boost in average users and gains in revenues per user.
The average monthly unique players metric showed that the roster was up 44% to 2.1 million, from 1.5 million in the June quarter a year ago.
The average revenue per average monthly unique players was $137, gaining ground from $103 last year.
Presentation materials showed the company captured share in the online sports betting (OSB) market, where the company estimated its “handle” share in the most recent quarter stood at 35%, up from 27% a year ago, while revenue share grew to 32% from 20% last year. Its gross revenue share in iGaming was 27% versus 21% last year.
CEO Jason Robins said during a conference call with analysts that the respective shares are “the highest they have been since the COVID-impacted second quarter of 2020.”
Chief Financial Officer Jason Park said that increased share and usage helped drive revenues more than 70% higher, to just under $875 million. The shares were up 6% in intraday trading Friday (Aug. 4).
Looking Toward Narrowing Losses
During a question-and-answer session with analysts, Robins said the company will endeavor to reduce the gap between its “handle” (the amount of money accepted in terms of wagers) and gross revenue. And, per Park’s remarks, the company is narrowing its guidance for EBITDA losses, tied in part to “stronger customer retention, acquisition and engagement; structural sports book hold improvement; and favorable sport outcomes in the second quarter.”
Asked on the call how the company might reduce some of the friction points in seeking to narrow the gap and capture more revenues, Robins noted that “it’s true of any product in the digital space that there’s always going to be room to optimize your funnels and improve the experience, but particularly in regulated gaming, where there’s a lot of requirements that you have to follow and there’s a lot of states that launch very quickly — so, the focus for us has been on how do we get live and make sure that we’re complying with all relevant laws and regulations.”
Management noted on the call that in states where OSB and iGaming are both available, there’s about 50% cross-over, and the ratio has been consistent over time.
Management also stated on the call that there is potential to leverage artificial intelligence (AI) to boost revenues and reduce costs.
“[R]ight now with our developer efficiency initiatives, we’re focused on how do we get more done with our development team,” Robins said. “So, I think that what that probably means is over time, we don’t need to add as many engineers to get the work done.”
FAQs
DraftKings raised its fiscal 2024 revenue guidance to a range of $4.8 billion to $5 billion, up from a range of $4.65 billion to $4.9 billion. FactSet analysts are forecasting on average $4.82 billion. Shares of DraftKings have increased 22% this year through Thursday, while the broader S&P 500 index SPX is up 6%.
Do people win real money on DraftKings? ›
Can You Win Real Money at DraftKings? At DraftKings Sportsbook, every wager pays real money — even wagers made with bonus bets. Not only will you spend and deposit your own money (once your bonus bets run out), but you'll also be able to win money and withdraw it if your wagers cash.
What is the Ebitda for DraftKings 2024? ›
Adjusted EBITDA: $22 million in Q1 2024; FY 2024 guidance updated to $460 million to $540 million. Adjusted EBITDA Flow-Through Percentage: 60% in Q1 2024; expected to be 53% for FY 2024.
How fast is DraftKings growing? ›
DraftKings's recent history shows its momentum has slowed as its annualized revenue growth of 70.5% over the last two years is below its five-year trend. This quarter, DraftKings reported magnificent year-on-year revenue growth of 52.7%, and its $1.17 billion of revenue beat Wall Street's estimates by 4.6%.
What will DraftKings stock be worth in 2025? ›
According to our DraftKings stock prediction for 2025, DKNG stock will be priced at $ 63.79 in 2025. This forecast is based on the stock's average growth over the past 10 years.
Where will draft King stock be in 5 years? ›
DraftKings stock price stood at $35.13
According to the latest long-term forecast, DraftKings price will hit $55 by the end of 2025 and then $65 by the end of 2026. DraftKings will rise to $85 within the year of 2027, $100 in 2028, $110 in 2029, $125 in 2031 and $150 in 2035.
Has anyone won a million on DraftKings? ›
RotoGrinders: You recently won a $1,000,000 prize for the third time on DraftKings. This is simply amazing. Perhaps what is more amazing is that it has been a Green Bay stack that has helped lead the way each time. Are you a Packers fan?
What happens if I win big on DraftKings? ›
If you've won or placed into a paying position in a contest, the amount you've won, as determined by the prize structure of that contest, will be credited to your DraftKings account as soon as the contest ends. You can use your winnings to play even more contests or you can withdraw.
Do you get taxed on DraftKings winnings? ›
Winnings that meet certain state or federal thresholds must be reported by DraftKings to the IRS for tax purposes. There may be tax withheld from your winnings, depending on how much you've won, and what game you were playing.
Is DKNG a good long term investment? ›
Based on the comprehensive analysis of DraftKings' financial performance, market position, competitive landscape, and future prospects, DraftKings presents a potentially strong buy for investors in 2024.
DKNG Stock 12 Month Forecast
Based on 26 Wall Street analysts offering 12 month price targets for DraftKings in the last 3 months. The average price target is $54.04 with a high forecast of $60.00 and a low forecast of $35.00. The average price target represents a 54.09% change from the last price of $35.07.
How is DraftKings doing financially? ›
DraftKings guided full-year revenue to a range between $4.8 billion and $5 billion, up from its prior outlook of $4.65 billion to $4.9 billion. The sportsbook expects 2024 adjusted earnings before interest, taxes, depreciation and amortization of between $460 million to $540 million.
Will DraftKings ever be profitable? ›
DraftKings is undeniably making bottom-line progress, and at its current trajectory should indeed swing to the anticipated profit in 2025. A firm figure is elusive, though. The few analysts that care to make a guess about its earnings that far out suggest the company will earn on the order of $2.07 per share in 2026.
How many people gamble on DraftKings? ›
Online sportsbook DraftKings had 2.3 million unique player's Q3 2023 alone. In 2022 DraftKings recorded an average of 1.9 million unique players per month. That was nearly double the 2020 figure of 900 thousand unique players a month. DraftKings has seen their stock nearly quadruple this year.
How do you win the most on DraftKings? ›
- The fastest way to make money on Draftkings is to enter large-field tournaments with low buy-ins and high prize pools.
- This way, you have a higher chance of finishing in the money and making a profit.
DKNG Stock 12 Month Forecast
Based on 27 Wall Street analysts offering 12 month price targets for DraftKings in the last 3 months. The average price target is $53.29 with a high forecast of $60.00 and a low forecast of $35.00. The average price target represents a 44.46% change from the last price of $36.89.
Will DraftKings stock ever go up? ›
Key Points. DraftKings is benefiting from more states legalizing online sports betting. The next stage of the company's growth will be from becoming more profitable. The stock should be solidly higher in five years.
What are the prospects for DKNG? ›
DraftKings is expected to post earnings of $0.02 per share for the current quarter, representing a year-over-year change of +111.8%. Over the last 30 days, the Zacks Consensus Estimate has changed +68.9%. The consensus earnings estimate of -$0.19 for the current fiscal year indicates a year-over-year change of +89%.
