Flutter Entertainment Reports Mixed Q3 Results Amid FanDuel Growth

FanDuel, announced its financial results for Q3 2024, showing a significant year-over-year revenue boost of 27%, reaching $3.25 billion. However, the company continues to face net losses, posting a reduced deficit of $114 million, a substantial improvement from last year’s $262 million. The company credited the revenue growth to increased engagement across its various markets and the start of the NFL season, which spurred activity, particularly in sports betting.

Despite this, Flutter’s quarterly losses reflect high operational costs, though its adjusted EBITDA jumped 74% to $450 million. CEO Peter Jackson attributed the strong performance to strategic product innovations, particularly in the U.S. through FanDuel, and favorable sports outcomes that contributed to heightened betting volumes.

U.S. Segment Drives Strong Revenue Growth with NFL Season Kickoff

The U.S. division, largely represented by FanDuel, showed impressive growth in Q3. Revenue for the segment surged by 51%, amounting to $1.25 billion, nearly 39% of Flutter’s total revenue. The company’s market share in the U.S. online betting industry reached 35%, with a higher share of 41% specifically in sports betting. Average monthly players (AMPs) increased to 3.2 million, marking a 28% rise from last year, reflecting significant consumer interest, particularly during the NFL season launch.

FanDuel’s sportsbook revenue increased by 62% compared to the previous year. This was largely driven by a 36% increase in betting stakes, bolstered by the addition of new sports betting markets across the U.S. The iGaming sector within FanDuel also showed strong results, with revenue rising by 46% and a market share of 25%.

CEO Peter Jackson highlighted the NFL season’s role in driving betting volumes, noting that“peak wagers per minute already [sured] Super Bowl LVII.” He added that “our proprietary product offering continued to drive strong parlay penetration as well as a step up in live betting handle,”

In the UK and Ireland (UKI) market, Flutter reported a revenue increase of 18%, or 14% on a constant currency basis, totaling $846 million. The adjusted EBITDA for this segment rose by 29% to $237 million, largely attributed to expanded betting options and increased player activity. Average monthly players rose by 13% in the region, with sportsbook revenue up 9% and stakes climbing 8%.

The Euro Cup in July significantly contributed to the UKI performance, drawing in considerable betting volume and prompting higher engagement with same-game parlay wagers. These same-game parlays saw a 142% rise in popularity, with nearly two-thirds of the bets made on newly introduced options.

In its iGaming segment, Flutter partnered with provider Games Global to broaden its offerings, resulting in a 29% year-on-year growth. This move highlights Flutter’s ongoing strategy to diversify its gaming portfolio and enhance the player experience in the UK and Ireland market.

International Operations Gain Momentum with Italy and Australia Performing Strongly

Internationally, Flutter’s Q3 revenue rose by 15% year-over-year, totaling $781 million, or 17% on a constant currency basis. Adjusted EBITDA grew by 28% to $152 million, buoyed by the success of Italian subsidiary Sisal, acquired by Flutter in 2022. Sisal’s strong market performance contributed notably to Flutter’s increased Italian market share, with additional investments in the region expected as the company eyes the Italian lottery license.

In Australia, revenue from the company’s Sportsbet brand grew 12%, or 9% on a constant currency basis, to $371 million. While average monthly players increased by 6%, total betting stakes declined by 8% during the quarter. Flutter attributes this slower growth in part to differing market conditions but remains optimistic about future trends in this region.

Following Q3’s results, Flutter revised its full-year 2024 financial guidance. U.S. revenue projections were adjusted downward, narrowing by 1% to reflect a range between $6.05 billion and $6.25 billion due to less favorable sports results anticipated in Q4. U.S. adjusted EBITDA was also reduced by 4%, now expected to range between $670 million and $750 million.

For its non-U.S. operations, Flutter raised its revenue forecast to between $8.1 billion and $8.3 billion, with adjusted EBITDA estimated between $1.77 billion and $1.87 billion. This reflects anticipated growth of 11% in revenue and 3% in adjusted EBITDA year-on-year, signifying strong international expansion across its core markets.

Reflecting on Flutter’s Q3 performance, CEO Peter Jackson expressed confidence in the company’s strategy and market position. He noted that the company “had an excellent quarter with revenue growth accelerating to 27%, well ahead of market expectations.” Jackson also pointed to the robust demand across sports betting and iGaming platforms in both the U.S. and international markets.

He emphasized that the strategic innovations within FanDuel, as well as continued international growth, were key drivers for the company’s future. “In the U.S., we had a fantastic start to the new NFL season,” Jackson stated, adding that non-U.S. divisions had shown resilience by leveraging “the benefits of the Flutter Edge,” a platform designed to enhance operational efficiency and player engagement across markets.

Source:

”Flutter Entertainment narrows loss in third quarter, grows customer base 46%”, cdcgaming.com, November 12, 2024.