Flutter Entertainment, the parent company of FanDuel, claims its online gaming platform is the leader in sports betting in the US. However, based on certain metrics, DraftKings took over the top spot last week.
During a recent earnings call, Flutter brushed aside the notion that FanDuel has lost its edge over DraftKings. The company is also calling on state regulators to report net gaming revenue, which one executive said is a more reliable metric for determining market share.
In fact, FanDuel’s success in the Indiana sports betting market is an example of this.
FanDuel No. 1 in Indiana sports betting revenue
Like in most states, FanDuel Indiana and DraftKings Indiana occupy the top two spots in lifetime handle and revenue. DraftKings handled about $1 billion more in wagers than FanDuel. However, FanDuel generates more revenue than its Boston-based rival.
Lifetime Indiana sports betting totals
|Ameristar East Chicago||DraftKings||$347,846,967||$4,739,214,984|
|Belterra||BetMGM | Betway||$128,619,544||$1,357,399,486|
|Hollywood Lawrenceburg||PointsBet | Barstool||$104,751,285||$1,033,453,899|
Legal online sports betting launched in Indiana in October 2019. Since then, FanDuel has generated $384.4 million in adjusted gross revenue (AGR). That’s $36.5 million more than DraftKings, which has generated $347.8 million in AGR.
Despite trailing DraftKings in handle, FanDuel has a significantly higher hold percentage than DraftKings in Indiana. Hold percentage is the percentage of money that a sportsbook retains after all bets have been settled. FanDuel has a 10.1% hold percentage in Indiana. Meanwhile, DraftKings’ hold percentage is 7.3%.
Flutter CFO wants states to put more focus on revenue numbers as opposed to handle
Flutter’s claims of FanDuel being the No. 1 sportsbook in the US after FanDuel’s revenues did not meet Wall Street’s expectations in the third quarter. The company’s revenue grew by 20% year over year to $820 million, and average monthly players increased by 38% during the start of the new NFL betting season.
Flutter Chief Financial Officer Paul Edgecliffe-Johnson is now calling on state revenue reports to focus more on Net Gaming Revenue rather than gross gaming revenue because NGR is the most reliable metric while also not considering promotional spend. In that scenario, FanDuel has a 47% market share and holds the top spot ahead of DraftKings.
“But now we’ve got nine states that are publishing that and we are encouraging the rest of the states to do the same because I think that’s really the metric that matters,” said Edgecliffe-Johnson. “And I think that demonstrates our strength as our NGR share is more than DraftKings – and that’s the key metric.”
Flutter CEO Peter Jackson boasted about the business’s profitability. He says FanDuel is the first online operator to achieve structural profitability. Jackson also alluded to the start of the NBA betting season being FanDuel’s time of the year.
“I am very pleased, though, with how the business is performing. If you look at, historically, our strength has always been when sports are back on, firing all cylinders,” said Jackson. “And you know that we have a really, really compelling product for the NBA, which always, I think, disproportionately favors us. We’re excited to see what we deliver in the course of this NBA season in Q4 and Q1.”