Flutter Reports 9% Growth as US Doubles Sportsbook, Casino Players

FanDuel parent company earns $1.96 billion in total revenue; US division sees intense competition in Q3, but makes $381.2 million.
Flutter Reports 9% Growth as US Doubles Sportsbook, Casino Players
By
November 03, 2021

Flutter Entertainment said its US and Australia divisions helped offset losses in the UK, Ireland and elsewhere during Q3 2021, allowing the company to post $1.96 billion in total revenue, a 9% increase year-to-year.

The Dublin-based sports betting and iGaming giant attributed the increase in revenue to double-digit growth in its global player base. The company said it doubled the number of sportsbook and casino players in the US during the third quarter, while also holding 42% of the US sports betting market.

In the US, Flutter had 1.3 million average monthly players in Q3 2021, up 17% from the 1.1 million it had in the year-ago quarter. Globally, the group had 7.3 million average monthly players in the latest quarter, up 13% from 6.4 million in Q3 2020.

CEO: Competition “threw everything at us”

During an earnings call Tuesday, CEO Peter Jackson said the most recent quarter included “certainly the most competitive start to an NFL season to-date,” adding that its competition “threw pretty much everything at us.”

The company’s US division earned $381.2 million in Q3 2021, up 74% from the $219.2 million earned during the year-ago quarter. Of the latest total, $250.5 million came from sportsbook revenue while $129.4 million was from gaming revenue, up 86% and 53% year-to-year, respectively.

Flutter’s brands in the US include FanDuel, FOX Bet and PokerStars, as well as Stardust Casino and the TVG Network. The company said FanDuel accounted for 94% of the $381.2 million the US division made during the third quarter.

Sportsbook stakes increased 80% year-to-year to about $2.9 billion in Q3 2021, with Jackson saying the company is “now regularly seeing staking volumes on NFL Sundays that match our Super Bowl performance.” He added that competition in the US during the quarter “was the most severe that we have experienced so far,” especially with the start of the NFL season.

“Every year, we expect to see renewed levels of competition,” Jackson said. “That was the case this year, with everyone trying to claim their positions in the market.”

A “land grab” in the US

FanDuel Sportsbook is now live in 12 states, including Arizona and Connecticut, which both came online in September. Flutter’s gaming products are currently available in five states.

Commenting on Arizona, Jackson said the state “matured and grew more quickly than any other market” the company has seen so far. He added that in more “established” states like Pennsylvania and New Jersey, “it sometimes feels like some of the other operators have given up in those markets because they see that we’ve got such a strong and commanding lead. In the newer states, we see new operators will try really hard to compete with us.”

That competition has amounted to “a bit of a land grab at the moment,” the CEO said, with big casino groups, pure-play digital businesses and others stepping up to compete with FanDuel. That said, “there is only so much funding that any of these businesses can access and provide free money to people before they eventually run out of it.

“I think ultimately, whilst competitors may be giving customers effectively free money and very enticing looking free bets, what people ultimately want are great products, and we have the best products in America. That’s what has customers coming back to our platform time and time again.”

Ahead of the competition

Jackson added that he believed Flutter would be able to maintain its leadership position from a customer experience perspective in and around its parlay product.

“It’s something we’ve done consistently in Australia,” he said. “And while our competitors may be accruing rights to third-party products to try to catch up with where we are, rest assured that we have many fantastic engineers in the US striving to keep us ahead of them.”

Jackson said seven additional states are expected to go live in 2022, mostly for sports betting. “The thing that were closely watching and monitoring is the extent to which any of the large states could potentially introduce regulation and come on stream, which would obviously have a bearing on the amount of money we’d invest in trying to take advantage of them opening up.”

Flutter expects to be profitable in the US in 2023. US net revenue guidance remains unchanged at $1.75 billion to $1.94 billion, with an adjusted EBITDA (earnings before interest, taxes and depreciation) loss of $340.5 million to $374.5 million, up from previous guidance where the low end was $306.4 million.

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