DraftKings Stock Pops on ‘Solid Beat’
2022.05.06 17:01
DraftKings (DKNG) Stock Pops on ‘Solid Beat’
Shares of DraftKings (NASDAQ:DKNG) are up more than 3% in premarket trading Friday after the company boosted its FY revenue forecast.
DKNG reported its Q1 revenue of $417 million, topping the consensus estimates of $414.9 million. The average revenue per monthly unique payer stood at $67 in the period, beating the expected $63.97.
The number of monthly unique payers stood at 2 million, in line with the analyst estimates. The company reported an adjusted EBITDA loss of $289.5 million, while analysts were expecting a loss of $327.5 million.
Looking ahead, DKNG expects FY revenue in the range of $1.93 billion to $2.03 billion, up from its previous forecast of $1.85 billion to $2 billion, while analysts were looking for $1.96 billion.
The fantasy sports contest company expects FY adjusted EBITDA loss between $760 million and $840 million, compared to its previously forecasted loss of $825 million to $925 million, and an expected loss of $912.9 million.
“We are pleased with our strong revenue and Adjusted EBITDA performance in the first quarter, which was driven by healthy underlying customer behavior and our ability to capture efficiencies,” said DraftKings CFO Jason Park.
Benchmark Co. analyst Mike Hickey said DKNG delivered “a solid beat.”
“We note updated guidance does not include Ontario, Canada, and the recent acquisition of Golden Nugget Online Gaming. DKNG is not seeing any impact from inflationary pressures on customer demand. We are encouraged to see a reduced guided profit loss, but acknowledge losses remain significant, and does not include many new markets expected to open,” Hickey told clients.
Needham & Company analyst Bernie McTernan also noted better-than-expected results.
“The outperformance in both revenue and adj. EBITDA is helping to drive guidance higher for both, before including Canada and GNOG. We expect the call to focus on the competitive intensity/promotional environment and any potential changes in necessary investment levels,” McTernan wrote in a note.
By Senad Karaahmetovic
