Flutter Earnings: New FanDuel Stock US Listing Window Revealed

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FanDuel posted strong US margin and player growth in the third quarter, as Flutter CEO Peter Jackson boasted about the business’s profitability.

The US sports betting and iGaming business holds a 47% share of US net revenue and saw average monthly FanDuel players grow a record 38% during the NFL betting launch.

“We are particularly pleased by the great progress we are making in the US,” Jackson said in the release. “We are the first online operator to achieve structural profitability, and the strong ramp in EBITDA during 2023 will continue into 2024 and beyond, as our profit margins expand materially.”

Stock reaction and US update

The market did not love Flutter’s update that its adjusted EBITDA excluding the US should be £1.44 billion for the year, as that is the bottom of the previously provided range. Flutter called out £50 million in unfriendly sports results and £30 million in adverse foreign exchange movement.

FLTR dropped 10.2% in London Thursday to 12,300 pence. Volume topped 750,000, up from its average daily volume of around 685,000.

How it trades in the US following its full year earnings will certainly be a storyline, as Flutter expects its FanDuel stock listing to be live during the first quarter of 2024. It was previously expected to go live in the fourth quarter of 2023.

Flutter will cancel its Euronext Dublin listing around the same time as the US goes live.

FanDuel EBITDA ramp is coming

Flutter is targeting the midpoint of its previous guidance ranges for its full-year results. That sets the expectations at $4.7 billion for revenue and $180 million for adjusted EBITDA for all of 2023.

That will be ramped up in 2024, Jackson said on the investor call.

“FanDuel will be the first operator to deliver full-year profitability, and our continued high-level of investment in player acquisition at compelling returns will drive a ramp in profit into 2024 and beyond,” he said.

NBA product ‘disproportionately’ favors FanDuel

Jackson did not dig into specifics about the start of the NBA season but alluded to it being FanDuel’s time of the year:

“I am very pleased, though, with how the business is performing. If you look at, historically, our strength has always been when sports are back on, firing all cylinders.

“And you know that we have a really, really compelling product for the NBA, which always, I think, disproportionately favors us. We’re excited to see what we deliver in the course of this NBA season in Q4 and Q1.”

FanDuel Q3 performance

Gross win margin in the third quarter his 11.5%, up 0.8 percentage points from last year. That bump came from “product innovation drove higher parlay penetration in the quarter” combined with Flutter’s pricing and risk management, the release said.

Revenue grew 12% to £668 million while average monthly players hit 2.564 million. FanDuel’s net sports betting revenue share of 47% is 5 percentage points higher than last year.

Gross revenue market share was 40%, 2 percentage points lower than last year. The launch of profit boost tokens and marketing costs around the start of football season is to blame, Flutter said.

Revenue from sports betting and iGaming jumped 12% in states that launched before 2022.