DraftKings posts big loss but revenue soared despite lack of live sports
DraftKings recently went public at what would seem to be the worst possible time.Because of the Covid-19 pandemic, there isn’t a heck of a lot of live sports to bet on.So it should come as no surprise that DraftKings just posted a $68.9 million loss for the first quarter.
Although Major League Baseball has yet to start its season and the NBA and NHL have suspended play, gamblers still found other things to place wagers on.DraftKings reported $88.5 million in sales for the quarter, a 30% increase from a year ago.
Including the operations of SBTech, a gaming tech company DraftKings bought late last year, sales in the first quarter were more than $113 million.
Gamblers are still betting on plenty of other events, such as virtual NASCAR races and esports tournaments, DraftKings said.The betting and fantasy sports site has also launched free contests centered around pop culture and news events such as this year’s Democratic presidential debates and popular reality TV shows like “Survivor” and” “Top Chef” to keep users engaged.Investors loved the news.
Shares of DraftKings, which soared when it began trading last month following a merger with an already-public special purpose acquisition company, were up more than 12% Friday.Read More DraftKings goes public without many live sports to bet on DraftKings stressed that the company expects a surge in sports betting once the big leagues resume live events -— which could be later this summer or fall.
There are also no current plans for the National Football League to change its schedule.The season kicks off in September.
The company said in the earnings release that it did not anticipate that the coronavirus outbreak would impact its financial results in 2021 or change its long-term plans.Bettors have a lot of pent-up demand to watch (and bet on) football as well as any other sporting events that might take place later this year, CEO Jason Robins recently told CNN’s Alison Kosik on the “Markets Now” show .
The Masters golf tournament, for example, has been rescheduled to November from April, while the Kentucky Derby, originally planned for May, will take place in September.DraftKings is also rolling out other features beyond sports betting and fantasy sports leagues.The company just launched online casino games for customers in Pennsylvania, including virtual blackjack, roulette and slot machines..