• DraftKings takes over online leadership in August, says EKG.

• And maintains its leads in New Jersey and Massachusetts.

• Las Vegas Sands bullish on Macau growth.

• 888 confirms a trading downturn in Q3.

• More analyst summaries of G2E.

• BettingJobs’ Jobsboard includes MD and sportsbook manager roles.

That's when I fell for the leader of the pack.

DraftKings No.1

Overall online market share leadership passes to DraftKings.

No.1 in heaven: DraftKings was the overall market leader in online gambling in the US for the first time, achieving ~31% market share in August across OSB and iCasino combined vs. erstwhile market leader FanDuel’s ~30%, according to the analysts at EKG.

• Recall, analysts at Deutsche Bank suggested in late September that DraftKings had overtaken FanDuel in August as OSB market leader by 41% to 34%.

• Moreover, the latest data from New Jersey and Massachusetts for September shows DraftKings consolidating its lead.

• In New Jersey it achieved a share in GGR of 45%, down from 59% in August but still comfortably ahead of FanDuel on 29%.

• In Massachusetts it continued to dominate with 52% of GGR vs. 28% for FanDuel.

• Some relief for FanDuel came from Pennsylvania in September where it held on to the combined lead by 29% to DraftKings’ 25%. 

• The team at JMP noted the top two were “just getting more dominant”, with the early September data showing they shared a combined 83% market share.

🩳 🚶DraftKings maintains sports-betting GGR lead in New Jersey

Getting better all the time: The EKG team attributed DraftKings’ success in grabbing overall market share in part to the acquisition of Golden Nugget, a solid product and, what they argued, is a significant improvement in its operational execution that allows the company to “capture more value on a per-customer basis”.

• EKG added that FanDuel’s recent downturn makes the long-unassailable brand leader look vulnerable, particularly in OSB where DraftKings is closing – or has closed and surpassed – its rival.

• But EKG said the changing of the guard at the top came “during a period when the competitive landscape was unusually soft”, with Caesars and BetMGM having curtailed marketing spend.

• But, they added, the game is far from over. FanDuel could “potentially spend/execute its way back into a lead”, while ESPN Bet and Fanatics could “reshape the national GGR share landscape in the next 12-24 months”.

• Still, its data showed DraftKings’ ability to “reel in FanDuel” using more than just the “brute force” of marketing spend, instead “harnessing the power of more focused, disciplined execution”.

• JMP said of the top two they were “clearly outpacing the competition heading into the seasonally most important stretch of the year”.

Green initiative: Speaking of new entrants…

House of mouse: Earlier this week Disney provided a peek into the financials at ESPN as a standalone business for the first time. Cut to the chase –  earnings are going backwards, down 20% in the first 9 months of FY23.

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Sands balm

With ‘stellar’ assets, Las Vegas Sands puts the case for Macau growth.

I'ma say all the words inside my head: Addressing market fears over the trajectory in China’s gambling enclave, CEO Rob Goldstein said the question was how quickly the market got to $35bn-$40bn of marketwide GGR “and beyond”.

• “We are firm believers that it will occur on a much shorter timetable than anyone realizes,” he told analysts on the Q3 call.

• “LVS has invested $15bn in Macau, which is the most important land-based market in the world.”

• LVS reported Macau Q3 adj. EBITDA of $631m, comfortably beating consensus of $611m, while Singapore came in at $491m, again ahead of analyst estimates of $444m. Revenue was up 178% to $2.8bn.

• CFO Patrick Dumont added that LVS expected margins to exceed 2019 levels, noting that margins in Macau exceeded 40%.

• Asked about this increase, Dumont said there was “a little bit of magic behind it – it’s called revenue increase”.

• Such was the confidence in the company’s prospects that it announced a $2bn share buyback through to 2025.

Move to where the puck is going: Goldstein said the “beauty” of the LVS business model as it pertains to customer segments was the company had “plenty of capacity to [cater for] everyone”. “We will move to the market,” he added. 

• “As you saw in the quarter, we moved tables around to accommodate where we saw demand,” he said.

• “We can grow into any market in any segment that shows strength and that's what happened here.”

Trading slump

888 confirmed the details of its late September profit warning showing an across-the-board decline in trading.

Wide of the mark: The size of the task that lies ahead for new CEO Per Wideström, who formally began in his role on Monday, was evident in the detail of the Q3 downturn in business, which cited regulatory headwinds as a factor in the 10% decline in revenues.

• Total revenues fell to £405m, with both sports betting and gaming down 10% to £143m and £262m respectively.

• The biggest drop came in international where gaming was down 18% and sports betting off by 23%.

• Recall, in January 888 admitted to compliance failures related to its Middle Eastern VIP business in January, which cost previous CEO Itai Pazner his job.

• The company said previously it had subsequently yet to see the expected return in that business.

Analyst takes: Peel Hunt said that with revenue growth, synergy extraction and cash flow on the horizon, they believed FT23 would “prove to have been the turnaround year for 888”.

• “It has paid for the synergies this year and should get the full benefit next year while revenue rises and, with 2025E coming into view quite soon, should be more obviously cheap,” the team added.

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Earnings in brief

Rank: The UK casino-to-bingo-to-online operator said in a trading statement that revenues rose 11% YoY to £180m, led by a 13% improvement in the Grosvenor venues business to £84.2m. London NGR rose 8%, while NGR for the rest of the country was up 16%.

• The company said the outlook was “challenging” with consumer discretionary spend still under pressure.

Monarch Casino & Resort: Market share gains in Black Hawk weren’t enough to offset the competitive pressures on the Reno properties, as revenue slipped 1% to $133m while adj. EBITDA came in at $49.2m.

Analyst takes

G2E takeaways: The “consistent story” from Las Vegas last week was the consumer remained healthy, M&A was likely to pick up, albeit with the well-documented issues around interest rates and equity value, while Las Vegas remained strong, according to the team at Wells Fargo.

• The good news/bad news for online was that, while the product continues to improve, the “legislative path is less positive”.

Churchill Downs: The team at JMP said Churchill Downs would benefit from the decision of the Virginia Supreme Court to reinstate the ban on skill-gaming machines. Noting Churchill Downs runs HRMs in the state, they suggested there was an “incremental opportunity to capture play”. 

Datalines

Arizona: August OSB GGR was down 23% to $21.4m on flat handle at $358m.

Pennsylvania: OSB in September was down 12% to $66m on handle that rose 12.5% to $726m; iCasino GGR rose 41% to $159m.

New Jersey: B&M GGR was down 2% to $245m, while sports-betting GGR rose 14% to $112m and iGaming GGR was up 21% to $164m.

Massachusetts: Casino GGR came in at $90.4m for September, down 4.2% YoY; sports-betting GGR hit $51m on $512.2m in handle.

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Newslines

Canadian gaming outfit Gateway Casinos, which runs 31 properties across the country, is seeking a buyer, according to Bloomberg, which said the company had hired Morgan Stanley and Macquarie Group to find potential investors at the $2bn mark.

On rotation: The NFL plans to include Las Vegas in a rotation of regular Super Bowl hosts – even before the booming sports market hosts its first league title game, according to Front Office Sports.

Trading in Elys Game Technology shares has been suspended after the company received written notice from Nasdaq over the failure of the company’s common stock to maintain a minimum closing bid price of $1.00. 

• The company said it was carefully “evaluating whether an appeal of Nasdaq’s decision is warranted”.

Mansion will close all B2C operations for its Casino.com and MansionCasino.com brands, effective as of October 26.

• Managing Director for Mexico – LatAm 

• Sales Manager – Remote

• Sportsbook Manager – Remote/UK

Calendar

• Oct 24: Boyd Gaming

• Oct 25: Churchill Downs (e), VICI (e)

• Oct 26: Evolution, Churchill Downs (call), VICI (call), Reputation Matters, London, GLP (e)

• Oct 27: GLP (call)

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