DraftKings Reports Higher Revenue for Start of Football Season

DraftKings online sports betting company Inc.

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posted higher-than-expected revenue for the start of this year’s football season and said its customer base continued to grow amid competition for gambling.

The company reported revenue of $502 million for the three-month period ended September 30, more than double its revenue in the same period last year. Strong customer acquisition and retention, expansion into new states, such as Kansas, and declining customer promotions contributed to the growth, the company said. Sports betting operators have also won more from customers’ bets this season of the National Football League as the results of the games have favored the sportsbooks.

DraftKings said average monthly unique paying customers increased to 1.6 million in the third quarter, up about 22% from 1.3 million customers in the same period last year. The growth was offset by a decline in fantasy-sports players, the company said. Average revenue per customer doubled to $100, the company said.

This year’s football season, the most popular sport for betting, was a highlight for online gambling operators. In recent years, companies have gone into the red on marketing in search of new customers, but this year operators have started to cut back on advertising and free betting offers as they aim to turn a profit in 2023.

DraftKings raised its 2022 revenue guidance to a range of $2.16 billion to $2.19 billion, representing year-over-year growth of 67% to 69%. The company previously said it expected between $2.08 billion and $2.18 billion in annual revenue.

The company reported a net loss of about $450 million for the third quarter, compared to a net loss of $545 million in the same period last year. It now expects a loss in adjusted earnings before interest, taxes, depreciation and amortization of between $780 million and $800 million for the year.

DraftKings said it expects to achieve positive adjusted EBITDA in the fourth quarter of 2023. The company’s forecast assumes that DraftKings will launch in Maryland later this year and in Ohio, Massachusetts and Puerto Rico next year, said the company.

The company operates online sports betting in 18 states and online casinos in five states.

Write to Katherine Sayre at katherine.sayre@wsj.com

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