DraftKings CEO Jason Robins, in an earnings call Friday, said the company is eyeing Ohio sports betting as the state looks to launch its market before the end of the year.
“There are three U.S. jurisdictions that have legalized mobile sports betting in which we are preparing to launch on licensure and approval from regulators: Maryland, Ohio and Puerto Rico,” Robins said on the Q1 2022 earnings call. “These three jurisdictions represent approximately 7% of the U.S. population and will bring the percentage of the population where DraftKings expects to offer legalized sports betting to approximately 43%.”
The Ohio Casino Control Commission (OCCC) this week posted its Sports Gaming Implementation Timeline and state law requires sports betting to go live before Jan. 1, 2023. The key dates on the timeline suggest it’s possible to go live during the NFL season.
That would mean big things for NFL fans, as using a PointsBet Ohio promo code is one of the most reliable ways to secure value on NFL bets.
DraftKings Sportsbook is now live in 17 states with mobile sports betting representing approximately 36% of the U.S. population and is live in five state with iGaming representing 11% of the U.S. population.
On the call, Robins also expressed the company would launch in Ontario in the second quarter of this year. The Ontario iGaming and sports betting markets have been live since April 4, but DraftKings has not been approved in the province yet.
DraftKings has not yet announced any partnerships with the pro teams in Ohio. The Cleveland Browns and Cleveland Cavaliers have announced deals with Bally’s, Caesars and Fubo.
Also on an earnings call this week, Caesars CEO Tom Reeg indicated his company is preparing for an Ohio launch.
“We have got an Ohio launch in front of us, that would be the only launch that I can think of that would have significant costs surrounding it,” Reeg said. “And so how we come out of the box in Ohio will be a governing factor in terms of where we would be, but that's the rights we’ve got.”
DraftKings Revenue Beats Estimates
The Boston-based company announced Friday that its Q1 revenue was $417 million dollars, which exceeded expectations by $7 million and its adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) outperformed the company’s expectations finishing more than 12% better. But its losses were about $467 million in Q1.
“DraftKings delivered significant growth across our key revenue and performance metrics. 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,” Robins said in the release of earnings. “We are also improving our efficiency in acquiring and retaining customers and have a strong pipeline of new jurisdictions to enter.”
DraftKings reported adjusted earnings per share of -74 cents, topping estimates of -$1.15 EPS. Still a negative number, but not as bad as predicted. DraftKings stock was just over $13 a share on Nasdaq Friday, down about 8% on the earnings report Friday. Its 52-week high is $64.58.
DraftKings is raising its fiscal year 2022 revenue guidance from a range of $1.85 billion to $2.0 billion to a range of $1.925 billion to $2.025 billion, which equates to year-over-year growth of 49% to 56%. $DKNG https://t.co/Bjog10u9ZF pic.twitter.com/6Raksvtvpp— DraftKings News (@DraftKingsNews) May 6, 2022
Revenue Guidance Increased
DraftKings also announced its expected revenue for the remainder of the year:
- 2nd quarter: $400-$420M
- 3rd quarter: $400-$420M
- 4th quarter: $730-$750M
“We are pleased with our strong revenue and Adjusted EBITDA performance in the first quarter, which was driven by healthy underlying customer behavior and our ability to capture efficiencies,” DraftKings Chief Financial Officers Jason Park said. “Therefore, we are increasing the midpoint of our fiscal year 2022 revenue guidance by $50 million and improving the midpoint of our fiscal year 2022 Adjusted EBITDA guidance by $75 million.”