DraftKings Q2 2024 Earnings Report
Key Takeaways
DraftKings reported strong second-quarter results with a 26% increase in revenue to $1,104 million. The company raised its full-year revenue guidance but revised its Adjusted EBITDA guidance downward. A $1.0 billion share repurchase program was also announced.
Revenue increased by 26% to $1,104 million compared to Q2 2023.
Monthly Unique Payers (MUPs) increased by 50% to 3.1 million.
Average Revenue per MUP (ARPMUP) decreased by 15% to $117.
Raised 2024 revenue guidance and revised adjusted EBITDA guidance.
DraftKings
DraftKings
Forward Guidance
DraftKings raised its fiscal year 2024 revenue guidance to a range of $5.05 billion to $5.25 billion and expects fiscal year 2025 Adjusted EBITDA to be in the range of $900 million to $1.0 billion. The Company now expects fiscal year 2024 Adjusted EBITDA of between $340 million and $420 million.
Positive Outlook
- Raising fiscal year 2024 revenue guidance to a range of $5.05 billion to $5.25 billion.
- Expecting fiscal year 2025 Adjusted EBITDA to be in the range of $900 million to $1.0 billion.
- Continued to capitalize on the healthy customer acquisition environment for the rest of 2024.
- Plan to implement a gaming tax surcharge in high tax states on January 1, 2025 which could drive Adjusted EBITDA upside on an annual basis.
- DraftKings’ Free Cash Flow trajectory.
Challenges Ahead
- Revising its fiscal year 2024 Adjusted EBITDA guidance to between $340 million and $420 million compared to its prior guidance of between $460 million and $540 million.
- Decrease in Average Revenue per MUP (ARPMUP) was primarily due to lower ARPMUP for Jackpocket customers when compared to customers of DraftKings’ existing product offerings prior to the acquisition.
- Customer friendly sport outcomes.
- Increase in new customer promotional investment for the Company’s Sportsbook and iGaming product offerings as a result of strong customer acquisition.
- Excludes the impact of the planned gaming tax surcharge for fiscal year 2025 Adjusted EBITDA.