Flutter CEO: “Lot of confidence” in attaining 2023 US profitability goal

Flutter Entertainment CEO Peter Jackson has asserted his belief that the firm’s US division will deliver on Flutter’s goal of becoming profitable before the end of 2023.

In its Q1 trading update, the FanDuel Group parent company reported a 92% constant currency (cc) year-on-year (YOY) increase in its US divisional revenue, which hit £908m ($1.1bn).

This divisional growth was punctuated by a 116% increase in sports revenue and a 43% spike in revenue from gaming arising from the US division during the quarter.

This was the latest in several quarters of US growth for Flutter, with the firm expecting to become profitable in the US in its full-year 2023 financial results. Speaking as part of the Q1 update, Jackson was bullish about the division’s chances of attaining this goal.

“When we look at the US, there’s a lot of confidence we have in our ability to make a profit this year. The question really, for us, isn’t specifically how much we make, it’s what the trajectory of the business will be over subsequent years,” Jackson explained.

“This will come when we add in layers of new customers who will of course flip from costing us money initially to generating very significant contributions and then following through to enhance our profitability in future years,” he added.

Central to the continued growth of Flutter US is the interaction of the so-called ‘FanDuel advantage’ of efficient player acquisition, retention, and customer value growth and its interaction with the wider strategy used by Flutter, namely, the ‘Flutter Edge’.

Addressing these strategic points, Jackson cited customer acquisition shifts towards longer lifetime-value customers as making a real difference to the business over the longer term, with particular focus on maintaining the customer acquisition cost/lifetime player value dynamics .

“Based on what we’ve seen over the course of this year, we’ve been really pleased with the shift in our acquisition strategy to acquire customers of higher value,” Jackson noted.

“The insights that the team had around acquiring customers in the run up to the playoffs in the football rather than trying to acquire customers in the second half of the season near the Superbowl has vindicated the good work the team is doing,” he added.

Flutter’s other main US goal, other than maintaining its leadership position, is to facilitate a listing of its shares on the Nasdaq stock exchange, a process now enabled by shareholders last week in a vote held at the firm’s Dublin HQ.

As part of plans for this to occur by Q4, Flutter has recruited US executive John Bryant to be its new chairman, replacing long-serving chairman Gary McCann, with the former set to become chair on September 1.

Speaking about the impending listing, CEO Jackson cited access to US capital and liquidity, and conversely the benefits of being in the minds of US investors through media and NYSE membership.

“There’s a strong overlap between the retail consumer in the US and the people who would like to participate in financial success and open accounts with us, as well as using US-based equity to reward and retain our colleagues in the US, do deals with US-based affiliates and other media businesses,” he explained.

“There’s lots of cool factors that were that are driving us towards the US, not least of which is the fact that 60% of our staking globally now is done in America.

“The business is very successful over there. We’re delighted with the 50% market share, delighted with the 95% growth year on year. I think we’re really consolidating our leadership position in America,” Jackson concluded.