Differing fortunes
Flutter Entertainment has released its Q1 results and they have thrown up some interesting insights. The gambling group had another strong period for its US operations, but its efforts in the UK and Ireland have not been doing as well.
drop-off in gambling activity across the UK and Ireland
It appears that the winding down of COVID-19 pandemic restrictions has led to a drop-off in gambling activity across the UK and Ireland. The online revenues in these regions dropped 20% year-on-year. Additionally, the measures the company has put into place before the introduction of the upcoming tighter UK gambling regulations have cost about ￡30m ($37.5m) over the last year.
Revenue growth of 45% in the US helped Flutter Entertainment’s revenue to grow by 6% in the first quarter of 2022. Its average monthly player levels also rose significantly, by 15%. One of the company’s other major markets is Australia, where the SportsBet brand is prominent. It also saw strong results across the board during the first quarter.
FanDuel going from strength to strength
FanDuel’s success has led to Flutter’s US revenues rising to $574m in Q1. Some of the big moments for FanDuel so far in 2022 have been the launch in the Louisiana and New York markets, as well as in Ontario, Canada.
FanDuel now has a 37% share of the US online betting market
It was able to smash numerous FanDuel records in the first quarter: it attracted 19 million wagers during March Madness and Super Bowl Sunday was the operator’s best-ever day for acquiring new customers. Flutter’s Q1 earnings announcement stated that FanDuel now has a 37% share of the US online betting market, making it the number one sportsbook in the country.
Speaking about the strong start to the year, Flutter Entertainment chief executive Peter Jackson said: “With our enlarged recreational customer base, winning position in the US and ongoing focus on sustainable growth, our business remains well placed for the future.”
Spending big on marketing
With US sports betting only becoming legal on a federal level in May 2018, there has been a major land grab by online operators in each state that has legalized the activity. Most of the major operators have been spending huge sums on marketing their offerings in an attempt to secure as much market share as possible.
FanDuel is not taking a step back
FanDuel is not taking a step back in these efforts with Flutter Entertainment chief executive Peter Jackson saying that it will continue to “push really hard” to get new customers on board. However, a number of other major US operators are now looking at pulling back on their marketing expenditure.
Caesars Entertainment reported a $576m loss this week for its digital division in Q1; a major reason for the sizeable loss was its significant marketing spend. It now plans to significantly cut down on these costs. WynnBET is another operator that has announced its intentions to not spend as much on marketing, with Wynn Resorts CEO Craig Billings referencing “the unsustainable nature of the current competitive environment in sports betting.”