DraftKings Reports $502M in Revenue, Projects Heavy Losses

DraftKings is still on the road to profitability, according to its latest earnings report. 

The Boston-based fantasy and sports betting giant generated $502 million in revenue in Q3 2022, a 136% increase compared to the same period last year. 

The results were attributed to strong customer acquisition and retention, launches in new markets, high hold rates largely from NFL wagering, and reduced spending on promotions. 

On the company’s quarterly earnings call, DraftKings CFO Jason Park said that its sports betting business seems unaffected by recent economic uncertainty.

• DraftKings raised its full-year revenue to range between $2.16 billion and $2.19 billion.
• Its previous guidance was between $2 billion and $2.18 billion.
• The company operates sports betting in 18 states — roughly 37% of the U.S. population.
• In May, it launched its sportsbook and iGaming products in Ontario, Canada. 

Despite the growth in revenue in Q3, DraftKings projects heavy losses. 

It expects an adjusted EBITDA loss of between $780 million and $800 million in FY2022 — an improvement from an estimated loss of between $756 million and $835 million last quarter. 

Shares of DraftKings tumbled as much as 25% on Friday. 

Imminent Deal

DraftKings and ESPN are close to signing an exclusive deal that “will have shows and perhaps odds integrated into game broadcasts,” according to The Action Network.

ESPN previously secured co-exclusive deals with Caesars Entertainment and DraftKings in 2020.

Disney owns roughly 5% of DraftKings after purchasing more than 18 million shares in 2020.