US sports betting operators are finally starting to focus on profitability, though meaningful profit could still be years away.
That analysis comes from Fitch analyst Colin Mansfield, who was one of three analysts discussing sports betting on a panel at the East Coast Gaming Congress held Thursday and Friday at Hard Rock AC:
“That’s what their conversations are focusing on and that’s what their strategy is starting to turn toward, where it’s less about grabbing market share and more about, ‘How do we get to the path of profitability?’”
Sports betting ops know they have to rationalize spending
That said, meaningful profits could take until 2025, maybe 2024, Mansfield added. Mansfield pointed to the “soft facts” that operators throw out, like being profitable on one NFL betting weekend or turning profitable in a state.
There is a bit of a blind spot with profitability, he added, but said watching profitability is definitely becoming a primary strategy for operators.
“They know they need to turn more profitable, they know they need to start getting a little more rational on customer acquisition costs, marketing spending, promotional activity,” Mansfield said.
Mansfield expects sportsbook operators to start to break even from next year into 2024 before finally hitting a more normalized cash flow margin toward the 20% range.
Six-figure fine for William Hill in NV
William Hill‘s new parent company Caesars is on the hook for $100,000 in fines for duplicate bets tied to an issue beginning in 2015, the Las Vegas Review-Journal reported.
The company’s mobile betting platform would accept duplicate bets if someone tried to submit a bet more than once when the system was under a heavy load. That led to about 55,000 erroneous bets through Dec. 20, 2021.
The losing 42,000 bets resulted in customers losing $1.3 million. Another 13,000 were winning bets for about $2 million, which William Hill agreed to pay.
PointsBet launches sports betting in Louisiana
PointsBet is live in its 12th state after launching online sports betting in Louisiana.
This is the fourth state launch under an agreement with PENN Entertainment signed in August 2019.
Elys signing sports betting deals as lawsuit continues
Elys Game Technology is expanding its sports betting business with US Bookmaking despite an ongoing lawsuit between the two parties.
The company announced Wednesday it would power the retail sports betting in Maryland at the Rod ‘N’ Reel Resort. It followed that release with a Thursday announcement about more than 50 kiosk partnerships for Ohio sports betting. That exceeded Elys’s expectations for the first month.
Meanwhile, US Bookmaking employees are still seeking an emergency injunction in Nevada.
Six companies launch industry-led RG principles
BetMGM and its two parent companies Entain and MGM, along with DraftKings, FanDuel and Bally’s, announced a 12-point pledge for responsible gambling.
The pledge includes taking active steps to prevent underage and excluded individuals from gambling, providing customers with RG tools and encouraging the use of those tools.
Responsible gambling is finally being taken more seriously in the US, Keith Whyte from the National Council of Problem Gambling told LSR in July. Whyte also noted a recently signed responsible gambling deal for Rush Street helped “move the field forward.”