DraftKings reported a 135.8% revenue increase to $501.9m and reduced losses in Q3, but projections for 2023 have led to its share price tumbling.
As expected, B2C operations made up almost all of the revenue – at $492.8m, up by 160.6%. B2B, from the former SBTech business, made up the remaining $9.0m – a dip of 62.6%.
Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) were $264.2m, down by 15.7%.
On the back of this, DraftKings also raised its 2022 full-year revenue guidance from between $2.08bn and $2.18bn to between $2.16bn and $2.19bn. If met, this would mean year-on-year revenue growth of between 67% and 69%.
Jason Robins, CEO of DraftKings, spoke positively of the quarter during DraftKings’ earning call today (4 November).
“Our third-quarter revenue was $501.9m, much higher than expected,” he said. “2022 has been a transformative year for DraftKings.”
Elsewhere, he attributed the quarter’s success to focusing on efficiency without sacrificing growth.
“Throughout 2022, we’ve struck the right balance between delivering differentiated top-line growth and driving operating efficiencies.”
Jason Park, CFO at DraftKings, also noted that the revenue and adjusted EBITDA for the quarter had exceed expectations – and added that the increase in revenue projection was down to “the strength we saw in our online gaming particles in Q3”.
“Both revenue and adjusted EBITDA significantly outperformed expectations from our Q2 earnings call in August,” said Park.
Park added that the adjusted EBITDA growth was “primarily due to the higher-than-expected revenue”.