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Australian-listed sportsbook operator PointsBet turned out positive results for its fiscal third quarter despite a coronavirus-shortened sports schedule.
PointsBet is live in Iowa, Indiana, and New Jersey, but most of its business came from NJ. Results from NJ sports betting were positive despite missing major sports for more than half of March, showing some momentum.
While the sports world has slowed, PointsBet’s work has not. The company is using this time to develop and improve its tech platform, including its future iGaming offering, CEO Sam Swanell said.
Swanell believes a shift in thinking from the coronavirus pandemic creates even more opportunity for the US.
Consumers moving toward the online environment and increased willingness from states to launch online betting and gaming after seeing retail tax revenues fall off “will likely create an even larger and expediated opportunity for the company in the US,” Swanell said.
While there will certainly be pent-up demand once US sports return, the longer term has an even more favorable view, he added.
The current trading environment, however, has been “pretty lean” in the US, Swanell said.
Swanell expects to be “at or very near” the starting lines for Colorado, Illinois, and Michigan, which syncs with previous comments.
Colorado sports betting officially launches Friday with four operators set to go live. The three commercial casinos in Detroit launched retail betting in early March but no tribal entities followed suit before casinos shut down.
Online casino and sports betting are expected by early next year in Michigan, though there’s been talk that process could be sped up. PointsBet is watching that situation and would work toward an accelerated timeline if that happened, Swanell said.
The company still looks ready for an Illinois retail launch in July and an online launch in September, though Swanell noted the regulatory process has slowed in the state.
Illinois requires in-person registration through the first 18 months, though the company has an advantage as it’s partnered with Hawthorne Race Course that’s about 8 miles from downtown Chicago. It also will have three branded off-track betting locations throughout the Chicago metro area.
The sportsbook enters every new state looking for 10% market share as a start, Swanell said.
PointsBet took 5.6% of total NJ sports betting handle from January through March, according to the quarterly report. That’s up from 4% for October through December.
Swanell pointed out the company’s success in hitting its medium-term targets for win percentages already. PointsBet had a gross win margin of 6.5% compared to its 5% goal and a 3.9% net win margin compared to its 4% goal.
Existing customers becoming a larger portion of the business helps to reduce promo spending, Swanell said.
The quarter marked the first full quarter of operations in Iowa. Indiana only had a few days of operations before the sports world essentially shut down March 12.
Iowa’s approximate $3.5 million in handle represents about 2.6% of the market share for the quarter.
The state won’t see the same marketing investment until it allows mobile registration next year. Until then, expect “pretty conservative” revenue numbers in Iowa, Swanell said.
Indiana, meanwhile, had just $334,237 in handle for the month of March after launching March 6.