DraftKings revealed it was to purchase Jackpocket in February 2024. At the time it said the addition of the lottery app would generate up to $340m in additional revenue annually.
DraftKings said it is now focused on integrating Jackpocket into its operations and leveraging synergies to drive sustained growth. The group is looking to tap into the expansive US lottery vertical, while also adding to its existing offering. This, it said, would enhance customer lifetime value and bolster customer acquisition capabilities.
“Today we are announcing the completion of our acquisition of Jackpocket and the commencement of our value creation plan,” said Jason Robins, chief executive and co-founder of DraftKings. “We are well-prepared to quickly launch cross-sell programmes, further improve customer acquisition efficiency and continue to innovate and differentiate with our overall product portfolio for our customers.”
Ed Birkin, senior analyst at H2 Gambling Capital, looked closely at the deal here. “On the face of it, I think it could be viewed as a positive acquisition, providing diversification, scope for significant market growth and another customer acquisition channel,” he said at the time.
Why DraftKings will drive Jackpocket growth
Market leader Jackpocket is designed to offer customers a route to ordering official lottery tickets in multiple states. It is currently available in 18 US jurisdictions, including New York, Texas and Ohio.
The New York-headquartered business claims its app was downloaded nine times more than its closest competitor in fiscal year 2023.
“The completion of the acquisition represents an exciting new chapter,” Peter Sullivan, chief executive of Jackpocket said. “Together, we are confident that we will be even more capable of helping lotteries fulfil their mission of delivering revenue back to the beneficiaries they support.
“DraftKings’ proven reach and cutting-edge mobile platforms will continue to allow us to drive growth and innovation in the digital lottery vertical.”
Strong start to 2024
DraftKings’ February announcement that it was acquiring Jackpocket came just as it raised its 2024 financial forecast. It has since raised that forecast again following an “outstanding” start to 2024. Revenue of $1.18bn for Q1 to 31 March was more than 50% above the $769.7m posted in 2023.
Revenue is now set to amount to between $4.80bn and $5.00bn, up from the initial range of $4.65bn to $4.90bn. This would represent year-on-year growth of between 31.0% and 36.0%.
As for adjusted EBITDA, this is forecast at between $460m and $540, compared to the earlier $410m to $550m.
Following the North Carolina launch in March, DraftKings is now live with mobile sports betting in 25 states. Collectively, these markets represent approximately 49.0% of the US population.
Original article: https://igamingbusiness.com/strategy/ma/draftkings-begins-integrating-jackpocket-as-750m-deal-completes/
