- DraftKings has increased its year-on-year revenue growth by almost 100% for its third quarter their reports show.
- The sports betting company attributes this tremendous increase to many different factors, one of which being that they are now live in ten states with a mobile platform.
BOSTON – DraftKings had a better than expected third quarter from a year-on-year standpoint which can be seen on their Q3 reports that were released on Friday.
The sports betting conglomerate was up 98%, from 2019’s third quarter with $133 million in overall revenue while they reported $67 million for the year before in Q3. A number of factors contributed to the growth of the company in 2020 over 2019.
DraftKings 2020 Q3 & Reasons For Growth
Even with the Coronavirus Pandemic, DraftKings made a bunch of new moves in 2020, including becoming a public traded company in April through a business deal with SBTech (Global) Limited and the Diamond Eagle Acquisition Corp.
Once the business became part of the stock market, their figures began to grow. In 2019, they saw a 42% pro forma revenue growth by the time their Q3 report was drawn up based on the impending entry into the market that was originally announced in January 2019.
“In addition to our year-over-year pro forma revenue growth of 42%, DraftKings recorded an increase in monthly unique payers of 64% to over 1 million, demonstrating the effectiveness of our data-driven sales and marketing approach,” said Jason Robins, Co-Founder, CEO, and Chairman of DraftKings.
“Our product offerings and scalable platform provide a distinctive and personalized experience for customers across the ten states where we operate mobile sports betting today, and we look forward to entering additional jurisdictions at the earliest opportunity.”
Along with being on Wall Street and marketing, other drivers that led to the 98% growth were the return of sports and the number of states that the sports wagering business has entered nationwide.
DraftKings now offers their sportsbook application in ten different states after its successful launch in Tennessee earlier this month. This is the greatest number of states by any sports betting firm to have a live mobile sportsbook platform available to sports bettors in the area, totaling 20% of the US population that now has access to DraftKings’ online sportsbook.
In its third quarter, the company rolled out its product to Illinois which has already proven to be one of their largest and fastest-growing states thus far.
Robins noted that with Governor J.B. Pritzker’s continued suspension of in-person registration for mobile sportsbooks that DraftKings has been able to gain quite a few new players that equated to a large handle seen in the Prairie State for the sportsbook.
Plans For The Future Of DraftKings
Although they have tallied the highest number of states at ten, the company is in talks with both Michigan and Virginia about licensing and launching their sports betting application in those two states. This would make twelve states where DraftKings is active.
Due to their high marks, they have increased their 2020 pro forma revenue projections for the fiscal year from $500-$540 million to $540-$560 million. These figures would give the firm anywhere from a 25%-30% in pro forma revenue growth from 2019 to 2020, even with the outbreak of COVID-19 that plagued all sportsbooks in 2020.
Looking forward to 2021, DraftKings expects to grow even more as more states across the US legalize sports betting.
Revenue numbers for 2021 are in the range of $750- $850 million, making for a 45% growth from 2020 to 2021. The sports wagering brand expects to increase its revenues by almost 50% for the 2021 fiscal year over the final numbers for 2020 when it closes out in Q4.
“The resumption of major sports such as the NBA, MLB, and the NHL in the third quarter, as well as the start of the NFL season, generated tremendous customer engagement,” said Robins.
Going into Q4, DraftKings expects to see more of a surge because of all of these factors and the NFL season finishing out with their fiscal year. Football is the most wagered on sport in the country and betting on the NFL could help DraftKings reach their 2020 revised pro forma revenue goals as they expect will be the case.
News tags: Coronavirus | COVID-19 | Diamond Eagle Acquisition Corp. | DraftKings | Illinois | J.B. Pritzker | Jason Robins | Michigan | MLB | Nasdaq | NBA | NFL | NHL | SBTech Global Limited | stock market | Virginia | Wall Street
Christina has been writing for as long as she can remember and does dedicated research on the newly regulated sports betting market. She comes from a family of sports lovers that engage in friendly bets from time to time. During the winter months, you can find Christina baking cookies and beating the entire staff at Mario Kart…the N64 version of course.