FanDuel Adds 1.5M Customers in Q1, Will Be Profitable in 2023

Posted on: May 3, 2023, 10:55h. 

Last updated on: May 3, 2023, 01:51h.

Flutter Entertainment (OTC: PDYPY) announced Tuesday that its US operations, led by FanDuel, excelled in the first quarter, as revenue surged 92%.

iGaming earnings
An advertisement for FanDuel Sportsbook. The company posted dominant Q1 results. (Image: FanDuel Sportsbook)

The Irish gaming company said FanDuel’s sportsbook revenue soared 147% year-over-year as market share reached 50%, cementing the operator’s status as the biggest domestic bookmaker. Importantly, FanDuel will be profitable on an annual basis this year, according to the parent firm.

In the US, the combination of the FanDuel Advantage and the Flutter Edge drove further market share gains. We added over 1.5m customers in the quarter and we remain the clear market leader. Our US sports betting handle of $10.9bn represented almost 60% of the Group’s total sportsbook stakes,” said Flutter CEO Peter Jackson in a statement.

FanDuel is 95% owned by Flutter, with the other 5% controlled by regional casino operator Boyd Gaming (NYSE: BYD).

FanDuel Ascent Easy to Quantify

Last year, FanDuel set something of an industry standard, becoming the first US sportsbook operator to post a profitable quarter. Barring surprises among its rivals, the operator will be the first in this country to accomplish that feat on an annual basis.

How FanDuel arrived there isn’t surprising. New state launches and product innovations, including same-game parlays, are among the catalysts that spurred the company’s impressive results in the year’s first three months. The additions of Massachusetts and Ohio to the live and legal US sports betting lineup contributed to a 20% bump in FanDuel’s client base.

“Continued innovation of our market-leading Same Game Parlay products, including a broader offering on March Madness and in-play NBA betting, supported strong retention, with average monthly players (AMPs) 46% higher,” added Flutter. “This product innovation contributed to a 240 basis point increase in expected sportsbook net revenue margin in the quarter, driving greater customer lifetime value.”

If there is an area for improvement at FanDuel, it’s iGaming, where the operator trails rivals BetMGM and DraftKings. It appears the Flutter unit is making strides on that front.

“Our iGaming strategy is delivering results, with AMPs 47% higher and revenue growth of 43%. Product improvements in the FanDuel Casino app engaged more direct casino customers, while the Reward Machine free-to-play product drove an increase in player frequency. This delivered a 200 basis point improvement in our iGaming market share to 23% in the quarter,” noted the Irish parent.

Good News Mounting for Flutter

Flutter’s bullish comments on FanDuel arrived about a week after the company said its investors overwhelmingly approved a plan to list its shares in New York. That transaction is expected to take place later in the fourth quarter.

We were also very pleased to receive overwhelming support among our shareholders for the addition of a Flutter US listing. The strategic and capital markets benefits this will bring to Flutter will position the Group well for its next phase of growth,” said Jackson in the statement.

Outside of the US, Flutter’s first-quarter sales increased by 8%, supported by strength in Ireland and the UK.