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DraftKings Reports Significant Q2 Growth, Announces Share Buyback Program
The company remains a leader among US operators as it steadily grows its market share and leverages its successful business model to bolster onboarding and retention rates
Sports betting and digital entertainment company DraftKings Inc. published impressive second-quarter results for 2024, bolstered by rising customer numbers and effective engagement strategies. The Board of Directors authorized the company to repurchase up to $1.0 billion of its Class A common stock, demonstrating robust confidence in its future growth prospects.
The Operator Did Not Stand Idle
For the three months ended June 30, 2024, DraftKings posted revenue of $1.104 billion, an increase of $230 million, or 26%, over $875 million for the three months ending 30 June 2023. These results are primarily due to expansion in new jurisdictions, favorable sportsbook hold percentages, and the acquisition of Jackpocket completed on 22 May 2024.
DraftKings CEO and co-founder Jason Robins was satisfied with the company’s performance. He revealed several planned strategies to maintain this impressive momentum, like a gaming tax surcharge in high-tax states with multiple mobile sportsbooks and enhanced customer engagement strategies. He hoped these adjustments would generate additional value for the company.
We will continue to capitalize on the healthy customer acquisition environment for the rest of 2024, which positions us to achieve $900 million to $1.0 billion of Adjusted EBITDA in 2025.
Jason Robins, DraftKings CEO
Key operational metrics also showcased the company’s growth trajectory. Monthly Unique Payers (MUPs) increased to 3.1 million in Q2 2024, representing a 50% rise compared to Q2 2023. However, average Revenue per MUP (ARPMUP) registered at $117 in Q2 2024, a 15% decrease compared to the same period in 2023, driven by efforts to bolster player acquisition.
Management Remains Confident in Sustained Growth
Reflecting its robust performance, DraftKings has updated its fiscal year 2024 guidance. The company has raised its revenue estimates to between $5.05 billion and $5.25 billion, versus the February outlook of $4.80 billion to $5.00 billion. Adjusted EBITDA projections dropped to between $340 million and $420 million, impacted by continuing investments in market expansion.
On 30 July 2024, the Board of Directors authorized the repurchase of up to $1.0 billion of DraftKings Class A common stock shares. Alan Ellingson, DraftKings’ chief financial officer, was also excited regarding the operator’s free cash flow trajectory, noting that the share repurchase program underlined the leadership team’s optimism.
(This) $1.0 billion inaugural share repurchase authorization reflects our confidence in the Company’s attractive long-term outlook and healthy balance sheet.
Alan Ellingson, DraftKings chief financial officer
DraftKings continues demonstrating significant growth and strategic foresight, positioning itself as a sports betting and digital entertainment leader. The company’s strategic initiatives, backed by robust financial performance, underscore the commitment to deliver long-term value to shareholders and customers. With more and more US jurisdictions opening up their iGaming and online sports betting markets, the operator should find enduring success.
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Deyan is an experienced writer, analyst, and seeker of forbidden lore. He has approximate knowledge about many things, which he is always willing to apply when researching and preparing his articles. With a degree in Copy-editing and Proofreading, Deyan is able to ensure that his work writing for Gambling News is always up to scratch.
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