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This past spring, the most interesting live sport to bet on was Russian ping pong.
A lot has changed since then.
Sports-betting company DraftKings reported a better-than-expected third quarter on Friday after a "bonanza" of live sports this summer.
Due to coronavirus postponements, the July-September quarter saw action from all the major sports leagues (MLB, NBA, NHL and NFL) for the first time in history.
Tack on other big-time events including the Kentucky Derby, golf's PGA and U.S. Open, and the Nathan's Hot Dog Eating Contest - it was a dream setup for online bet-takers:
- DraftKings eclipsed 1 million unique gamblers, up 64% from last year.
- The flood of participation drove revenue to $133 million, up 42% year-over-year, slightly beating expectations.
FanDuel owner Flutter Entertainment also reported strong sales last week. The Ireland-based firm, which also owns Betfair and Paddy Power, said U.S. revenue soared more than 80% in the quarter.
The Customer is King
Casinos often treat high-rollers with lavish “comps” like penthouse suites and top-shelf liquor to keep them playing in-house. Wooing the internet gambler is no-less expensive.
- In the third quarter, DraftKings spent $203 million on sales and marketing to acquire customers and promote new state launches.
- Against revenue of $133 million, DraftKings is safely in the red.
What Else? Voters from Louisiana, Maryland and South Dakota legalized sports betting this month in a fresh victory for the gambling industry.
The Takeaway: DraftKings isn't the only game in town. Penn National Gaming just launched a Barstool-branded sports betting app and MGM Resorts expects its BetMGM app to be live in 20+ states by the end of next year.