DraftKings, considered to be one of the top-rated sportsbooks in the United States, recently announced its first-quarter earnings, revealing a spike in Monthly Unique Payers (MUP), Average Revenue per MUP (ARPMUP) and revenues.
Rosy Outlook
DraftKings investors had to be heartened to hear the Q1 financials which reported revenues of $1.17 billion, a sharp spike from the $770 million posted in Q1 2023, representing a 53% surge. Monthly Unique Payers (MUP) rose 23% from the same time period last year to 3.4 million 2024 Q1 users while the Average Revenue per MUP (ARPMUP) jumped 25% from a year ago.
The company attributes its stunning Q1 results to “continued healthy customer engagement, efficient acquisition of new customers, the expansion of the sportsbook product offering into new jurisdictions, higher structural sportsbook hold percentage, and improved promotional reinvestment for sportsbook and iGaming.”
Betting Big
The Q1 reports were so encouraging that DraftKings raised its FY 2024 revenue guidance to a range of $4.8 – $5 billion, which was up from its previous forecast announced in February of $4.65 – $4.90 billion. This updated 2024 revenue guidance range would set the company’s yearly revenue growth at 31% to 36% higher than last year. Moreover, the company’s Adjusted EBITDA forecast was adjusted from $410-$510 million to $460-$540 million.
“DraftKings’ performance in the first quarter of 2024 was outstanding, reflecting healthy revenue growth and a scaled fixed cost structure that positions us to drive rapidly improving Adjusted EBITDA,” said Jason Robins, DraftKings’ CEO.
“We successfully launched our online sportsbook in Vermont and North Carolina with highly efficient customer acquisition. Looking ahead, we remain committed to maximizing shareholder value through continued innovation, operational excellence, and disciplined capital allocation,” added Robins.
DraftKings Acquires Jackpocket
Also mentioned in the first quarter report was the company’s purchase of the lottery app Jackpocket for approximately $750 million. This will branch DraftKings into another realm of digital gaming and is expected to increase the company’s bottom line by about $340 million. The deal is expected to close in the second half of this year.
DraftKings CEO, Jason Robins, commented on the acquisition, saying: “We are very excited to enter the rapidly growing U.S. digital lottery vertical with our acquisition of Jackpocket.”
“This transaction will create significant value for DraftKings not only by giving our customers another differentiated product to enjoy but also by improving our overall marketing efficiency similar to how our daily fantasy sports database created an advantage for DraftKings in OSB and iGaming,” Robins added.
Peter Sullivan, CEO of Jackpocket, commented: “Together with DraftKings, we will be able to bring tremendous value to our customer base as we advance our mission to create a more convenient, fun, and responsible way to take part in the lottery.”
This purchase came hot on the heels of the company reporting yearly revenues in 2023 of $3.7 billion, which was a 63% increase compared to the year before.
