A favourable sports calendar and strong consumer engagement have been praised as major contributing factors to delivering a strong Q4 for DraftKings, as the group also lauds its burgeoning digital footprint.
Tennessee expanded the firm’s US presence during the fourth quarter of 2020, with mobile registration added in Iowa, alongside successful launches in Michigan and Virginia, having taken place this year.
Subsequently, DraftKings has undertaken to raise its fiscal year 2021 revenue guidance from a range of $750m to $850m to the region of $900m to $1bn, which equates to year-over-year growth of 40 per cent to 55 per cent.
It is noted, however, that the guidance assumes that all professional and college sports calendars that have been announced come to fruition, and that it continues to operate in states where the group is currently live today.
For the quarter, DraftKings reported revenue of $322m, an increase of 146 per cent compared to $131m during the same period in 2019.
After giving a pro forma effect to the business combination with SBTech and Diamond Eagle, which was completed on April 23, 2020, as if it had occurred on January 1, 2019, revenue grew 98 per cent compared to the three months ended December 31, 2019.
Net loss for the three month period ended December 31, 2020, grew to $266.4m (2019: $29.1m), adjusted EBITDA closed at a loss of $87.8m compared to 2019’s $8.7m, with monthly unique player increasing 44 per cent to 1.5m and average revenue per user growing 55 per cent.
ARPMUP, says DraftKings, was positively impacted by increased engagement with online casino and mobile sports betting product offerings, as well as successful cross-selling.
“With a favourable fourth quarter sports calendar and strong marketing execution, DraftKings was able to generate tremendous customer acquisition and engagement that propelled us to $322m in fourth quarter revenue, a 98 per cent year over year increase,” said Jason Robins, DraftKings’ co-founder, CEO and chairman of the board.
“In the fourth quarter of 2020, we saw MUPs increase 44 per cent to 1.5m and ARPMUP increase 55 per cent to $65. We are raising our revenue outlook for 2021 due to our expectation for continued growth, the outperformance of our core business and newly launched states that were not included in our previous guidance.”
For the full year, DraftKings, which raised and donated over $1.6m to charity through a variety of ESG-related initiatives in 2020, saw revenue surge 90 per cent to $614.5m (2019: $323.4m), net loss widen to $844.4m (2019: $142.7m), and adjusted EBITDA closed at a loss of $391.9m (2019: $98.6m).
