DraftKings Inc. gained as much as 5.1 per cent in early trading Friday after boosting its revenue expectations for the year, another signal that sports betting isn’t slowing down.
The online gambling company expects US$900 million to US$1 billion in revenue for 2021, up from US$750 million to US$850 million. The raised guidance topped Wall Street expectations for US$863 million and implies 40 per cent to 55 per cent growth compared to the year prior.
Boston-based DraftKings said the guidance assumes that all announced professional and college sports calendars go forward as planned. Major events ahead include college basketball’s March Madness and conference tournaments as well as the NBA and NHL playoffs.
“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,” Chief Executive Officer Jason Robins said in a statement.
DraftKings reported a 44 per cent increase in monthly unique players, to 1.5 million, as a rise in states offering legal gambling drew new users. The growth in monthly players, which beat the highest analyst forecast of 1.45 million, was in part fueled by growth for traditional online gambling, mobile sports betting and daily fantasy sports users.
Fourth-quarter revenue of US$322 million beat the consensus analyst estimate of US$233 million, as compiled by Bloomberg. That’s the third time the company has topped revenue expectations since it went public via a reverse merger in April.
DraftKings stock was up 3.3 per cent to US$59.70 at 7:54 a.m. in New York. The shares had climbed 230 per cent since the April debut through Thursday’s close, outperforming the S&P 500’s 37 per cent gain.
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