BetMGM revenue breaks $200m barrier in Q3

BetMGM expects to generate a five-fold increase in annual net gaming revenue (NGR) to $200m during the third quarter of 2021. According to the latest data provided by JV parent company Entain, BetMGM has achieved a 23% market share in sports betting and igaming during the three months to August. BetMGM has also portrayed itself as the US market leader in igaming with 32% market share in the three months to August. The brand accrued $357m in NGR during the first half of 2021 and has a guidance target of $1bn by 2022, which it is on track to exceed. However, Entain CEO Jette Nygaard-Andersen has decided to stick with the $1bn guidance figure despite the booming NGR of Q3. The BetMGM app is currently live in 16 jurisdictions, having launched in Arizona, Wyoming, and South Dakota during the quarter. In Arizona, the firm attracted more first-time depositors (FTDs) on launch day (September 9) than in its entire US sports betting operations during the whole of 2020, leading to a 30% market share in the Grand Canyon State. To coincide with the new NFL season, the firm launched the second iteration of its “Win Like a King” ad campaign with Hollywood Star Jamie Foxx. Reflecting on the first month of operations in Arizona, Nygaard-Andersen said: “When we look at the first weeks of the NFL, there were some pretty hefty bonuses and promotions being used in August by some of our competitors which were quite aggressive. “However, we’re seeing it slowly dying down and we remain confident that the environment will normalise over time,” Nygaard-Andersen added. BetMGM parent company Entain is currently a takeover target for US rival DraftKings, which tabled a $22.4bn (£16.4bn) offer for the company in September. Under UK regulations, DraftKings now has until October 19 to firm up its interest in Entain or walk away from the negotiating table. However, BetMGM co-owner MGM Resorts has called into question the long-term future of the JV relationship if Entain decides to accept DraftKings’ multi-billion-dollar offer. Speaking at G2E, MGM Resorts CEO Bill Hornbuckle revealed the firm had held “casual conversations” with Entain over a buy-out of the BetMGM joint venture. “Ultimately, if DraftKings is able to acquire Entain, they’ll need to come to us if they want to continue to operate in the US, as they can’t do both,” Hornbuckle said. Analyzing the potential future of BetMGM, Peel Hunt analyst Ivor Jones hinted the time could be right for Entain to investigate a sell-off. He said: “What doesn’t show up in the EBITDA is the remarkably strong performance in the US, where the BetMGM JV is making a credible push for overall sports betting and igaming market leadership. “This could be the perfect time for Entain to sell out of the BetMGM JV, if MGM can be pushed to overpay. “However, that is just a possibility and it doesn’t seem like a knockout offer from DraftKings is on the table at the moment,” Jones added.