Flutter Entertainment expects a US$370m drop-off in US revenue for 2024 due to “very unfavourable” sports betting results in recent months.
The FanDuel owner said the “most customer-friendly” NFL season in online sports betting’s history has seen the highest rate of favourites winning in nearly 20 years.
This has resulted in substantial customer wins throughout November and December, “primarily” on NFL parlay and same-game parlay outcomes.
As a result, Flutter said there has been an adverse gross gaming revenue impact of $438m and estimated reductions in revenue of approximately $390m and adjusted EBITDA of $260m between November 12 and December 31.
This is expected to translate into 2024 US revenue reaching $5.78bn, around $370m lower than the group’s previous midpoint of guidance between $6.05bn and $6.25bn.
Flutter’s adjusted EBITDA in the US for 2024 is expected to hit $505m, around $205m lower than the midpoint of guidance of between $670m and $750m.
Flutter’s revised expectations include Q4 sportsbook net revenue margin of 6.6 per cent.
“Q4 US revenue is therefore now expected to be approximately $1.59bn and Q4 US adjusted EBITDA is estimated to be approximately $161m, reflecting an overall estimated adverse Q4 sports results impact totalling $643m in GGR, $550m in revenue and $360m in adjusted EBITDA,” the company said.
Nevertheless, “good momentum” elsewhere, particularly in UKI, means Flutter has estimated 2024 revenue and adjusted EBITDA ex-US will be around one per cent and two per cent higher, respectively, than the mid-points of its guidance published in Q3.
Flutter is set to reveal more in its Q4 earnings report on March 4.
