Flutter Revenue up in Q1, but Incurs Net Loss as Operational Costs Increase

Article by : Erik Gibbs May 17, 2024

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Flutter Entertainment has reported a substantial rise in first-quarter revenue, achieving a 16.4% year-over-year increase to $3.4 billion. Despite this notable growth, the company faced a significant net loss of $375 million, a sharp contrast to the first quarter of 2023 when it reported a net profit of $54 million.

The primary reasons for the net loss include a marked increase in operating expenses and negative foreign currency translation effects. The latter alone accounted for a loss of $185 million for the quarter. These financial pressures collectively transformed what could have been a profitable period into one of notable financial loss.

Peter Jackson, CEO of Flutter Entertainment, highlighted a strong start to the year, especially in the US market. He emphasized that FanDuel’s robust top-line momentum is driving significant growth in adjusted EBITDA and market share gains.

Jackson pointed out that Flutter’s strategy focuses on expanding its player base and market share while embedding future profits through disciplined investment practices.

Flutter reported growth across all its markets, with the US market standing out significantly. The US accounted for over 40% of the group’s total revenue, exceeding $1.41 billion.

FanDuel, a leading brand under Flutter, has been instrumental in strengthening the company’s market position in the states. The introduction of new casino content by FanDuel was particularly successful, resulting in a record igaming Gross Gaming Revenue (GGR) share of 27%.

Outside the US, Flutter has focused on delivering superior products for players, driving success in various regions. In the UK, the launch of Super Sub on Paddy Power has been the company’s most successful product launch to date, reflecting strong market reception and player engagement.

In Italy, Flutter has actively captured market share in online sports betting and iGaming, achieving an all-time record in market performance in April.

Flutter is progressing towards relocating its primary share listing from the London Stock Exchange to the New York Stock Exchange (NYSE), a move expected to be completed by May 31. This transition is anticipated to enhance the company’s visibility and attractiveness to US investors.

In North Carolina, FanDuel’s launch of online sports betting was highly successful. It became the company’s second-most successful launch to date, with 5.3% of the population registering within 45 days.

Across the US, growth in the first quarter slowed to 32%, following an initial 11 weeks of 56% growth, indicating a deceleration over time. Poor margins in March, attributed to unfavorable outcomes during March Madness, resulted in a $76 million drag on Flutter’s bottom line.

Despite these challenges, underlying trends remained positive, with a handle increase of 46%, suggesting strong engagement and betting activity among users.