Draftkings Inc (NASDAQ:DKNG) shares soared after Thursday’s closing bell as the fantasy sports and betting company reported much higher third-quarter revenues than expected and raised its full-year guidance.
Its shares gained 6.8% to about US$31 shortly following the release of its financial report.
For the third quarter, DraftKings reported revenue of $790 million, an increase of 57% over the $502 million reported in the year-ago quarter.
Wall Street analysts had pegged revenue at $702.3 million.
The company attributed its increased revenue to continued healthy customer engagement, the acquisition of new customers, expansion of its Sportsbook product offering into new jurisdictions, an increased parlay mix and thus higher hold percentage, and improved promotional reinvestment for Sportsbook and iGaming.
It reported a loss per share of $0.61, better than the loss per share of $0.69 expected. In the year-ago quarter, DraftKings reported a loss per share of $1.
“Our new and differentiated features and functionality have created an exceptional user experience that sustains engagement for our mobile sports betting and iGaming customers,” DraftKings CEO Jason Robins said in a statement.
“We also delivered another successful online sportsbook launch in Kentucky and look forward to additional launches in Maine and in North Carolina, pending licensure and regulatory approvals.”
On the back of its strong 3Q results, the company said it was raising the midpoint of its full-year 2023 revenue guidance from $3.5 billion to $3.695 billion, which represents growth between 64% and 66%.
It also raised the midpoint for its adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) guidance to negative $105 million from its prior expectation of negative $205 million.
Further, the company introduced fiscal 2024 revenue guidance in the range of $4.5 to $4.8 billion and adjusted EBITDA guidance in the range of $350 million to $450 million.
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