DraftKings stock jumped 10 percent when the stock market opened on Friday morning. The uptick came after the sports betting and DFS giant reported its third-quarter earnings and future revenue guidance.
The company said it brought in $133 million in revenue and raised its revenue projections on the year to as much as $560 million.
“The return of major sports has generated tremendous customer engagement,” said DraftKings CEO Jason Robins, on the company’s earnings call.
DraftKings is now in 10 states that the company says represents roughly 20 percent of the U.S. population.
The company is still spending more money than it brings in on marketing alone ($191 million), driven by the fact, Robins said, that DK was now operating in seven new states for the NFL season in 2020.
Robins expressed optimism on the future, referencing the numbers coming out of Illinois, which is now its second-largest state in handle behind New Jersey and its fastest growing market overall. He also said the company hopes to be able to do sports betting business in Ontario, Canada, which has a size that would make it the fifth-largest state if it was in the US.
For the last three months, DraftKings averaged more than 1 million monthly unique players, up 64 percent compared to the same time period a year ago. Those users generated average revenue of $34, which was down partly because the first three weeks of the NFL season in which sportsbooks were consistently beat by bettors thanks to favorites and overs covering.
Robins said its integration with SB Tech will be complete by this time next year, giving DraftKings an advantage by having its own proprietary sports betting technology.
An equity offering and cashing out of early investors in October created dilution, which resulted in shares of the stock declining, but company chief financial officer Jason Park said the company is projected to have $1.7 billion in cash with no debt.
Distributed by Tribune Content Agency, LLC.