DraftKings, FanDuel prepare to fight their ground
DraftKings, FanDuel prepare to fight their groundDraftKings call recall, FanDuel’s Howe on CNBC, MGM and Flutter week ahead, startup focus – GuardDog +More
Waves don't die, let me crash here for the moment. DraftKings call“We are winning,” CEO Jason Robins tells analysts on DraftKings’ Q3 earnings call. You ain’t seen nothing yet: Robins never sounds like the over-excitable type but, still, he was clearly in a confident mood last Friday as he spoke about DraftKings’ prospects. “We have created what we believe is the strongest product in the industry,” he said. “But the best is yet to come.”
Day in, day out: Without any big state openings forecasted for 2024, and given DraftKings’ history of consistent quarterly beats and raises, the likelihood is the company will beat the upper range of forecasts, even with new competition entering the space.
Hold fire: On the threat of competition, he said DraftKings had already witnessed “multiple waves” and he still expected a decline in promos. “We'll stay disciplined,” he said. “The last time we saw a huge wave of competition, we didn't increase our promotion rate and I don’t think we expect to do that this time.”
Cash piles: Turning to a question that, as one analyst put it, has “just has never come up until now” – of what to do with its growing cash – Robins (not for the first time on the call) called it a “great question”.
Diary dates: Attention now turns to DraftKings’ capital market event on November 14. Meanwhile, more info on ESPN Bet will likely be forthcoming on Thursday with ESPN’s EDGE conference. 🔥 DraftKings up over 200% this year ** SPONSOR’S MESSAGE ** Venture capital firm Yolo Investments manages in excess of €500m in capital across 100 exciting fintech, gaming and blockchain companies. The Yolo Investments' Gaming fund, regulated by the Guernsey Financial Services Commission, has taken positions in fast-growth suppliers and operators, including Dabble and Enteractive. Yolo Investments (yolo.io) wants to hear from readers of this newsletter. Get in touch with your pitch, or for a chat about innovative products which can plug into our investment ecosystem. Analyst takes – DraftKingsImpervious: Jefferies noted that unlike with other areas of the leisure sector the team covers – including B&M gaming – a “call on the macro” was not a factor with DraftKings or the online space generally. “Overall, the guidance suggests that the positive momentum should continue,” the team added.
Scale model: The team at CBRE said critical scale was being reached. “Revenue continues to grow as absolute marketing dollars contract and the company scales its fixed-cost base far more efficiently,” they added.
FanDuel’s Howe on CNBCFaint heart never won fair lady: Speaking late last week to Contessa Brewer as part of CNBC’s Evolve Global Summit, FanDuel CEO Amy Howe said the competitive nature of the US OSB and iCasino landscape meant it was “not for the faint of heart”.
Scaling the walls: The other factor, she added, is the potential for the biggest operators to enjoy scale advantages, with the US online market showing signs of being “not dissimilar to many ecommerce industries” with high barriers to entry.
The week aheadTrouble and strife: The full impact of September’s cyber attack will be front and center for MGM AMC on Wednesday, along with questions around the potential impact from the threat of the Culinary Union’s strike action. Deutsche Bank noted they expected “plenty of room for interpretation”.
Ask a stupid question: There was some intrigue last week during Entain’s strategy update meeting when CEO Jette Nygaard-Andersen appeared to suggest the company was contemplating the injection of more funds into BetMGM, which was contrary to previous commentary from both JV partners.
Flutter: Jefferies suggested they were executing an upbeat trading update based on strong US market data and “rational competitor activity”. “We anticipate that FanDuel could take advantage to drive greater US market share gains in Q423,” they said.
Reporting this week
Shares watch – SportradarOn the radar: Penn Entertainment grabbed the market headlines late last week when its shares were boosted by confirmation of a launch date for ESPN Bet, but quietly heading the field on the same day was Sportradar, which finished Thursday up over 14% on the day.
🏀 Sportradar receives an end-of-week bounce Earnings in briefKonami: The gaming and systems division saw an 11.6% rise in H1 to ¥19.1bn ($127m), with all major markets “moving toward recovery”. Unit profit came in at ¥3.12bn, up 56%. The company said its Synkros casino management system, as deployed by Resorts World in Las Vegas, has been well received. Analyst takesEntain: Noting the announcement of Lottomatica’s €639m deal for SKS365, the team at Deutsche Bank said it was a party that Entain would previously and arguably should have crashed. But with the balance sheet cupboard “bare”, the team suggested Entain was “hamstrung”. Golden Entertainment: The team at CBRE pointed out that Golden’s return to beating consensus expectations after five consecutive quarters of misses is down entirely to having the Strat at the north end of the Las Vegas Strip back in full, newly renovated action. Startup focus – GuardDogAngels with dirty faces: To those looking at the controversies surrounding the state-by-state developments around pick’em fantasy games, the irony isn’t lost that one of the leading protagonists Underdog Fantasy have launched a fund specifically aimed at the responsible gambling space.
Speaking to E+M, the only nod CEO and founder Jeremy Levine offers to the current legal battles is his comment that Underdog Fantasy is “definitely talking to a lot of regulators”. But he adds that the guiding principle behind Underdog Fantasy – that the product could be done better – is the same for GuardDog.
Connective tissue: The initiative will involve identifying companies where Underdog Fantasy can not only invest but also mentor. “It takes me back to where I started when I launched a company that got picked up by Techstars,” he adds.
Companies and entrepreneurs interested in being considered by GuardDog can learn more and contact the GuardDog team at https://underdogfantasy.com/guarddog. ** SPONSOR’S MESSAGE ** Calling all sportsbooks! Are you:
Stop falling behind your competitors! Matchbook pricing and brokerage service is your connection to the sharpest pricing and global liquidity, helping you to manage risk and fortify your margins. Matchbook pricing is proven to be resistant to market changes. Matchbook B2B, because the best price is for everyone. Find out more at http://www.matchbook.com/promo/b2b or email b2b@matchbook.com What we’re readingWaiting for my man: Two decades in the making, the Fontainebleau in Las Vegas is but one step away from a potential December opening. Career pathsGiG has appointed Andrew Cochrane as chief business officer for its platform and sportsbook division. He previously served as senior VP of commercial for SBTech/DraftKings. NorthStar Gaming has announced CFO Jennifer Barber will resign, effective Dec 1. VP of Finance and Compliance Chin Dhushenthen will assume the role of interim CFO. Entain has appointed Amanda Brown as an independent non-executive director, starting Nov 8. She was most recently chief human resources officer at Hiscox. Playbook has named Jonathan Chilton as COO. He joins from GM Gaming. NewslinesFull House said its new Chamonix property in Black Hawk, Colorado, is now taking reservations ahead of its official opening on Dec 26. Kambi’s iCasino studio Shape Games will provide its sportsbook and casino front-ends to Sun International’s SunBet in South Africa. An +More Media publication. For sponsorship inquiries email scott@andmore.media. |
Older messages
DraftKings, Penn lead sector gains
Friday, November 3, 2023
DraftKings ups guidance, Penn's ESPN Bet plans, Entain's strategy update, analyst takes +More
Lottomatica’s big splash
Thursday, November 2, 2023
SKS365 buyout, Entain takes a hit, Seminole launch, Bally's tumble, slim-fit Sportradar, RSI profits +More
Caesars hails online frugality
Wednesday, November 1, 2023
Caesars positivity, IGT's lottery pull, Kambi deals, DarftKings's promo spend +More
Beats, misses, reviews, debt – the Halloween earnings mix
Monday, October 30, 2023
The week ahead, IGT shares wobble, Churchill Downs, gaming REITs calls reaction, startup focus – Golden Whale +More
Boyd’s ‘softness’ sparks a rout
Thursday, October 26, 2023
Boyd's wobble, Evolution delays, Betsson's boost, PointsBet regeneration +More
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