DraftKings revenue surges 84% in Q1 as loss guidance for FY23 is lowered
US operator generates $770m in revenue partly off the back of dual state launches while losses continue to shrink
DraftKings has posted an 84% year-on-year (YoY) rise in Q1 2023 revenue to $770m as the US giant praised an increase in customer retention and spend.
The Boston-based firm pointed towards launches in Ohio and its home state of Massachusetts as key drivers of growth, as well as a focus on product improvements.
Monthly unique players increased 39% YoY to 2.8 million during the first three months of the year. DraftKings said this was due to strong acquisition and retention and the expansion into new states.
Average revenue per player sat at $92, representing a 35% increase on Q1 2022. Bosses noted the increase was as a result of improvement in the sportsbook hold rate and a reduction in promotional intensity.
However, despite the increase in revenue and player base, DraftKings continues to sustain losses.
Net loss for the period fell from $467.7m to $397.1m, which translated into an adjusted EBITDA loss of $221.6m compared to $289.5m in Q1 2022.
While losses have continued to be cut, DraftKings is still expecting to post negative EBTIDA for full-year 2023.
The operator has realigned its guidance, which previously stood at a loss between $350m and $450m, down to between $290m and $340m.
Additionally, full-year 2023 revenue guidance has been lifted on the back of the strong opening to the year.
The previous guidance of between $2.85bn and $3.05bn has been replaced by new guidance of between $3.1bn and $3.2bn.
The guidance is based on DraftKings’ presence in its existing jurisdictions, plus the addition of Puerto Rico, in which it expects to launch later this year.
Touching on the results, DraftKings CEO Jason Robins said the first three months of the year showed the company was “positioned for sustained success”.
Robins said: “We delivered highly successful online sportsbook launches in Ohio and our home state of Massachusetts and continued to create meaningful product differentiation driven by in-house innovations.
“We acquired customers faster and more efficiently and, importantly, saw healthy retention across cohorts. Looking at the remainder of 2023, I am confident DraftKings is well-positioned to achieve profitability on an adjusted EBITDA basis in the near-term and deliver long-term value for our shareholders.”
DraftKings stock is up 82% in the past six months to $21.38, at the time of writing, as investors show faith in management steering the business in the right direction.