Operator Earnings Calls Largely Quiet About Ontario Sports Betting

Written By Pat Evans on August 16, 2022
Ontario sports betting

As an entire North American industry waits for official reports from Ontario sports betting regulators, individual companies revealed relatively little about the market during their quarterly earnings reports.

The earnings season started promising, as PointsBet kicked it off reporting its ON sports betting handle. Sports betting in Ontario started April 4 and in the quarter, PointsBet took $11.2 million in wagers.

However, earnings reports from other gaming companies kept Ontario updates brief and largely lacked any information of substance. Combined with PointsBet’s low handle, the vague operator details and lack of reporting from provincial regulators do not spell confidence for strong performance in Ontario.

On the flip side, multiple industry sources told LSR that privately operated bet365 could be dominating the market. Bet365 was a gray-market operator in Ontario, giving it an enormous advantage as it transitioned to the regulated market.

theScore plays catch up in Ontario

During Penn Entertainment’s August 4 earnings call, CEO Jay Snowden expressed optimism about theScore Bet’s future in Ontario sports betting, its home market. Still, the company did not share specific numbers from the province.

Snowden said theScore is experiencing a greater than 50% cross-sell from sports betting into iCasino. The call also highlighted the transition of the mobile app onto its in-house risk and trading platform.

“As it relates to the gray market in Ontario, clearly, the Bet365’s of the world have been at it for a long time, and we’ve really been focused on bringing new people into the ecosystem and then conversion of media – theScore media followers into sports betters,” Snowden said. “I think we’ll be a double-digit market share player in Ontario, both in online sports and online casino.

“Again, we don’t have public numbers yet, but when it’s released, we think that’s where we’ll be.”

FanDuel views Canada with high potential

In its H1 investor presentation last week, FanDuel parent Flutter listed Canada among markets with high potential. Along with Brazil and India, there is a “high” chance Flutter invests in future marketing in Canada.

The August 12 earnings call, however, said little about the Ontario sports betting market.

The only mention of Canada was that investments to launch Ontario actually brought down the already positive FanDuel quarter.

DraftKings Ontario sports betting doubts

During the DraftKings August 10 Q2 call, CEO Jason Robins said, “Ontario is kind of what we expected.”

Prior to launching in the province, Robins said it would be tough to compete with gray-market operators and the sportsbook would struggle compared to its US sports betting ambitions. Robins said DraftKings is on pace to secure between a 10% and 20% market share.

“We can achieve strong share, but probably wouldn’t have quite the same ceiling that we believe we have in the US and don’t have the same expectation that we would have in the US,” he said.

BetRivers likes Ontario sports betting ad restrictions

Rush Street Interactive CEO Richard Schwartz noted in the company’s August 4 earnings call that previous gray-market operators opened in Ontario with the advantage of built-up databases.

Schwartz said the advertising restrictions have helped new operators like BetRivers.

“We think we can grow substantially in Ontario over time and feel very good of our start there,” Schwartz said. “We are seeing good progress in Ontario, where July’s revenues per day is up over 30% compared to June, even with the lighter sports calendar.”

Entain happy with Ontario cross-sell

Entain CEO Jette Nygaard-Andersen said during an August 11 earnings call that BetMGM is on track with the expectations for Ontario. That would place BetMGM in the high single digits of market share, Nygaard-Andersen said.

“Actives are good, customer conversion, good retention,” Nygaard-Andersen said. “There is quite a bit of competitive pressure, but the good thing is that we have both sports betting there and also gaming. So we’re seeing good cross-sell, which is great as we go forward. And momentum is building nicely.”

At the Canadian Gaming Summit in June, BetMGM CEO Adam Greenblatt said he expects football to be strong, just not as dominant as in US sports betting.

Unibet backslides in Ontario

Among gray-market operators to migrate to the regulated ecosystem was Kindred Group’s Unibet.

The operator ended up moving backward in Ontario at the regulated launch when it shuttered some gray-market brands.

“The [gross wagering revenue] from Canada was negatively impacted by the closure of the 32Red business in Ontario and some lost customers upon the migration of Unibet to the licensed domain,” the Kindred investor presentation noted.

GAN goes slow in Ontario

In its August 15 investor presentation, GAN Limited executives reported its “slower than expected” Coolbet ramp was one of three major factors hampering earnings.

The company said it will mitigate the issue by watching the return on advertising spending in Ontario.

GAN also provides a variety of technology services for sportsbook operators, including bet365 and FanDuel. Its Canadian comments, however, do not appear to address those companies.

Other operators and Ontario sports betting

Super Group migrated Betway into Ontario’s regulated market this month. In its earnings report, the operator said its early performance is in line with expectations.

Caesars did not mention Ontario or Canada in its second-quarter earnings call.

888 mentioned it was among the first operators to launch in Ontario. CEO Itai Pazner said Canada is one of the company’s growth markets and the initial results are “really pleasing.”

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Pat Evans

Pat Evans is a Grand Rapids, Michigan-based reporter covering sports business. Evans previously worked at Front Office Sports and the Grand Rapids Business Journal. He has authored two books: Grand Rapids Beer and Nevada Beer.

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