DraftKings exceeded revenue projections in Q1 2023 thanks to the strong launches of Massachusetts as well as Ohio. In its earnings report, the company stated that the success of the performance was due to increased customer retention and productive acquisition.
Here are the top numbers from DraftKings.
Revenue up by 84.5% to $770 million
Net loss: $397 Million, down 15% YoY
Adjusted EBITDA (221.6 million dollars): down 23.5% YoY
Monthly unique payers: 2.8 million, up 39% YoY
DraftKings, DraftKings CEO and co-founder Jason Robins said: “DraftKings first quarter performance — 84% revenue growth year-over-year and share gains supported by a relentless emphasis on operational efficiency — demonstrates that the company is well positioned for sustainable success.” “We launched highly successful online sportsbooks in Ohio and Massachusetts, and we continued to differentiate our products through in-house innovation. We were able to acquire customers more quickly and efficiently, and importantly, we saw healthy retention among cohorts. “I am confident that DraftKings will be profitable on an adjusted EBITDA basis by 2023 and provide long-term value to our shareholders.”
DraftKings, based on the positive quarter, has updated its revenue guidance for the entire year. The company now expects revenues between $3.1 and $3.2 billion, up from $2.9 to $3.1 billion. The company has also reduced its expected adjusted EBITDA loss from $350-$450million to $290-$340million.
Robins, unlike many of his competitors, who are expecting profitability by 2023, was clear in saying that, although the path is becoming shorter, it is still several years away. He did mention that Q2 of this year should be near break-even and that Q4 could be profitable.
The company noted that the dramatic increase in year-over-year figures was due in part to the high expenditures for New York and Louisiana launches in 2022.
Robins emphasized the technological advances made by the company in the last quarter, such as the improved functionality of the app and the in-game parlay. DraftKings Sportsbook has also attracted 57% more new players in Q1 2022 than the first quarter of 2022.
Robins announced that BetMGM had lost market share for online casinos in the first quarter. However, the BetMGM earnings report stated that BetMGM was still the leader.
DraftKings continues to spend a lot on marketing and sales, even though many of its competitors have discussed reducing their marketing budgets. The group reported $389 million sales and marketing expenses, an increase over the $321 millions spent in 2022.