Flutter forecasts FY US revenue of more than $1.1bn on customer acquisition gains
Operator’s US brands acquire 450,000 new customers in Q3 despite igaming integration complications
Flutter Entertainment expects to generate more than $1.1bn in US gross gaming revenue (GGR) in 2020 on higher-than-expected customer acquisition gains in Q3.
Overall, the operator’s US business, including FanDuel, Fox Bet and PokerStars, Betfair and TVG, boasted more than 1.8 million active customers during Q3, with 450,000 acquired during the quarter.
The revised US guidance reflects a higher-than-expected rate of customer acquisition on the return of all major sports in September.
Flutter also expects to lose up to $238m in EBITDA on its expansion into new major states like Michigan and Illinois.
Group CEO Peter Jackson told investors the business finished Q3 with a 46% share of the overall US betting market and 29% of the combined sports and gaming market.
The firm’s gaming market share dropped slightly on integration complications as the US business completed its migration onto Flutter’s in-house PAM and wallet technology.
Jackson said the migration resulted in a short-term reduction in the number of casino games available across the product.
“We’re working very hard to get that availability of games back up to improve the offering to make sure that we can drive market share up as we go forward,” Jackson said.
“We’re very comfortable with our position at the minute and I’m really pleased with having got the entirety of the business across to our own account and wallet,” he added.
The operator said back in Q3 that it planned to migrate its US business onto the Paddy Power Betfair technology stack in H2.
Fox Bet experienced a boost in new customers through an integration with Fox News during the US presidential debates.
Jackson said: “We are really working hard with all the different Fox properties to make sure we can take advantage of different integration efforts.”
He said the operator’s scale enabled its US brands to acquire customers at a lower cost, with lifetime value coming in higher than expected.
“It does make us realize how important a number of those advantages that the FanDuel brand has, particularly around the ability to acquire customers at sensible acquisition costs,” he added.
On whether Flutter would increase its stake in FanDuel to 95% under the agreed timeframe of 2023, Jackson said there was “a lot more complexity” in the deal now.
According to the CEO, there is no immediate short-term pressure to resolve the complex arrangement, which also includes investment from Boyd Gaming.
“Where businesses have these complex arrangements you often find that they find an alternative route to resolving them – we don’t feel any pressure to necessarily undertake that path ourselves,” Jackson said.