FanDuel NJ sportsbook to “contribute positively” to 2020 revenue

FanDuel’s New Jersey sportsbook is expected to contribute positively to revenue for the first time in 2020, CEO Matt King told investors yesterday.

According to King, the firm’s US market share is currently at 43%, with 42% of FanDuel’s sports betting customer base coming from its fantasy database of over 8 million players.

As of 31 December 2019, the operator had acquired 350,000 sports betting customers with a CPA of less than $250, King said.

“It’s pretty clear that the DFS strategy is the winning strategy in the US at the moment and other operators have found it hard to bridge the gap in terms of brand awareness,” King said.

In New Jersey, 54% of FanDuel’s casino revenue was generated by sports betting customers in December 2019. The FanDuel Casino brand took 18% market share in Pennsylvania upon launching in January.

The firm is planning to adopt more of parent company Flutter Entertainment’s proprietary technology to help it scale and innovate in the US marketplace.

It signed a deal with Scientific Games to supply betting and igaming content as well as technology in January, although it is not yet known how much of SG’s technology will be used by FanDuel.

In 2019 FanDuel’s overall revenue came to $500m, including contributions from its DFS and TVG horseracing businesses.

King said over $600m had been invested in building the betting product since its inception, including a $130m contribution in 2019.

FanDuel accounted for 18% of Flutter’s overall business in 2019.

UK analysts Regulus Partners said: “Despite impressive scale and momentum, the business lost £60m ($76.6m), but with marketing running at ‘only’ 38% revenue (and 36% incremental marketing vs. incremental revenue), a pathway to profitability appears relatively clear if the majority of states are low tax, a critical mass are online and FD’s market share is not eroded by competition.”