In H1 2023, the Flutter reported profitability on both a US and group-wide basis. In the company’s earnings call, Jackson highlighted the business had previously expected 2023 to be the year in which the threshold was met.
“I think it’s important we remember the context a few years ago,” Jackson said. “We knew this year would be the tipping point, we reached that milestone earlier because the business is bigger than we anticipated.
“We knew this year would be profitable, we’ve proved the model works, we will continue to acquire and invest in as many companies as we possibly can.”
Jackson emphasises the importance of scale
The executive emphasised Flutter’s size, revenue, and market share as the business retained its title as the largest online gaming business in the world, as well as the US.
As such, the company recorded a 47% share of the total US sports betting market, which is down 3% from company’s total in 2022. Despite this small decline, Jackson said he was satisfied with business’s results for the quarter.
“When I look at our performance in Q2 with a 47% market share, yes it is down a bit on last year, but then our competitors were pulling back from the market last year,” he said.
Jackson pointed to the size of the business allowing it to invest in the quality of product, enhancing user acquisition and player value.
“We make 50% more money from our customers from handle than our competitors do,” said Jackson. “Our product that is best in the market today is a fast-moving target.”
Flutter bullish on growing leading position
“On the igaming share – we’re ambitious,” said Jackson, highlighting the prospects of the business boosting its online casino offering and subsequent market share.
While leading in the sports betting market, the operator has traditionally been only the third largest online casino business in the US, behind Entain-MGM joint venture BetMGM and DraftKings.
Jackson acknowledged mistakes had been made in the past concerning the quality of the product – but highlighted the company increasing its market share to 23% in the US.
“We knew last year our product wasn’t good enough, we see this as a multi-year operation,” he said.
“We’ve been really pleased in the way the business has grown in share. We’ve got exciting plans into next year as well.”
“We think we’ll get into product leadership next year. We are the world’s biggest online casino operator – we know how to do this stuff – we just haven’t always brought those capabilities to the US.”
Will Flutter launch second brand in US?
At the end of July Fox Corporation and Flutter jointly announced the businesses would be closing their sports betting joint venture Fox Bet.
Jackson said while the sportsbook will close, the corporate entity will continue, meaning Flutter will retain its market access agreement for Pokerstars.
“We think it’ll be a good brand for when igaming expands in the US,” said Jackson. While he said the brand had “primarily been focused on poker first”, he said Flutter was “not averse” to utilising multiple brands.
Jackson reacts to ESPN deal
Last night, ESPN announced it would be entering into sports betting in partnership with Penn Entertainment.
Jackson reacted to the deal – emphasising it is norm for the business to face fierce competition in the US.
“We always anticipate a highly competitive environment, this year will be no different,” said Jackson.
“A few people say they will make a bit of a splash this year. You asked me if we looked at deals and transactions in the US market, we do the ones we want we want to do, and leave the others to do the ones we don’t want to do.”
Original article: https://igamingbusiness.com/strategy/flutter-earnings-call/
