Heaven Can’t Wait, DraftKings Betting on Online Deregulation to Drive Revenue

Stoked by the convergence and integration of its myriad platforms and buoyed by its record of strong customer acquisition and retention, DraftKings has upped its 2021 fiscal revenue forecast to US$1.29 billion (£929m/€1.09bn) — despite operating expenses, this half alone, exceeding US$1 billion (£720m/€850m).

DraftKings has founded its finely-tuned corporate balancing act on real-time revenues that have tripled, year-on-year, to US$609.8 million (£439.1m/€518.4m) during this H1, ending June 30; unique-user loyalty and the promise of fat pickings when the key Florida market finally opens up to legal iGaming.

“DraftKings had a particularly strong second quarter of 2021,” said CEO Jason Robins.

The big rise in revenue was due to: “Strong customer acquisition and retention, the successful launches of our Sportsbook and iGaming product offerings in additional states since the second quarter of 2020 and a more favourable sports schedule compared to [Covid-impacted] six months ago.”

At US$549.6 million (£395m/€467.2m), the United States made up the vast majority of DraftKings revenue; the rest of the world US$60.2 million (£43.3m/€51.2m).

But operator expenses grew.

Costs in Sales and Marketing, for example, quadrupled to US$399.4 million (£287.6m/€339.5m), while the costs of product and technology soared 150 per cent to US$118.8 million (£85.6m/€100m) in the half.

In all, DraftKings has recorded a loss of US$646.3 million (£465.4m/€549.4m) — 185 per cent more than H1 last year.

On the positive side, most of DraftKings operations in 11 of 12 U.S. states have successfully migrated from the Kambi platform to their own in-house SBTech-based solution.

And DraftKings boss Robins is keen to explore the growth possibilities of streaming and pay-per-view.

“We’re looking at all those things,” said Robins. “We want it to be profit-generating in the long-term and have synergistic qualities to acquire and retain users.”

In alliance with its rival FanDuel, DraftKings is pushing forward its lobbying efforts to have mobile betting regulated in Florida.

“It’s the natural evolution,” he said.

“Many states don’t want to be the guinea pig, but we’ll keep pushing for it and show how it can be well managed, with responsible gambling systems which also generate meaningful tax revenues.”