DraftKings Completes Acquisition of Jackpocket
DraftKings (Nasdaq: DKNG) has finalized its acquisition of Jackpocket, a leading digital lottery app in the U.S., on May 23, 2024.
CEO Jason Robins highlighted the plan to leverage Jackpocket's technology to enhance customer acquisition and expand DraftKings' digital lottery offerings.
Jackpocket CEO Peter Sullivan emphasized the synergy in driving growth and innovation in the digital lottery sector. This acquisition allows DraftKings to diversify its product portfolio and improve customer lifetime value while maintaining a focus on responsible gaming.
- DraftKings completed the acquisition of Jackpocket, a major player in the digital lottery sector.
- The acquisition enhances DraftKings' position in the U.S. lottery vertical, expanding its digital gaming portfolio.
- Improved customer acquisition efficiency and potential for increased customer lifetime value.
- Enhanced value creation through cross-sell programs and product innovation.
- DraftKings' proven reach and cutting-edge mobile platforms to drive growth in the digital lottery space.
- The cost of acquisition may impact DraftKings' short-term financials.
- Integration challenges could delay the realization of synergies and value creation.
- Potential dilution of shareholder value if the acquisition was funded through equity.
Insights
The acquisition of Jackpocket by DraftKings represents a significant strategic move that has notable implications for stakeholders. By acquiring Jackpocket, DraftKings can now access the U.S. digital lottery market, which adds a new revenue stream to its existing sportsbook and iGaming operations. This move is likely to enhance customer lifetime value and improve customer acquisition efficiency, as mentioned in the announcement. It's also important to consider the cross-sell potential between the digital lottery and DraftKings' existing gaming products, which can lead to higher engagement and spending from existing customers.
DraftKings' focus on integrating Jackpocket's technology and user base into its ecosystem will be key to unlocking the value of this acquisition. Investors should monitor how effectively DraftKings can harness these synergies in the short term and the incremental revenue contributions from the digital lottery space over the longer term. Additionally, the acquisition can bolster DraftKings' competitive positioning in a rapidly evolving market, which is increasingly leaning towards digital and online offerings.
From a market perspective, the acquisition of Jackpocket enables DraftKings to diversify its product portfolio and reduce reliance on its core sportsbook and iGaming segments. This move offers a hedge against market volatility that can affect the sports betting industry, such as changes in regulation or seasonal fluctuations in sports events. The digital lottery market is relatively untapped compared to other forms of online gambling, presenting substantial growth opportunities. Jackpocket's established brand and technology infrastructure provide a strong foundation for DraftKings to leverage and expand its market share quickly.
Furthermore, the digital lottery market can attract a different customer demographic compared to traditional sports betting audiences, potentially broadening DraftKings' overall customer base. This diversification could be advantageous in achieving more stable, long-term revenue growth. Investors should consider the broader implications of this market entry, including how it positions DraftKings within the competitive landscape of digital gambling and what it means for future product innovation and customer retention strategies.
Unlocks Access to the U.S. Digital Lottery Industry and Significant Cross-Sell Capabilities
BOSTON & NEW YORK, May 23, 2024 (GLOBE NEWSWIRE) -- DraftKings Inc. (Nasdaq: DKNG) (“DraftKings” or the “Company”) today announced the completion of its previously announced proposed acquisition of Jackpocket Inc. (“Jackpocket”), the leading digital lottery app in the United States.
“Today we are announcing the completion of our acquisition of Jackpocket, and the commencement of our value creation plan,” said Jason Robins, CEO and Co-founder of DraftKings. “We are well-prepared to quickly launch cross-sell programs, further improve customer acquisition efficiency, and continue to innovate and differentiate with our overall product portfolio for our customers. We look forward to continuing to deliver enhanced value to our customers and shareholders as we integrate Jackpocket into the DraftKings ecosystem.”
Jackpocket is renowned for its innovative digital lottery services, robust technology infrastructure, and strong brand presence. This acquisition empowers DraftKings to tap into the expansive U.S. lottery vertical, while expanding its position in sportsbook and iGaming by enhancing customer lifetime value and bolstering customer acquisition capabilities.
“The completion of the acquisition represents an exciting new chapter for Jackpocket and DraftKings alike,” said Peter Sullivan, CEO of Jackpocket. “Together, we are confident that we will be even more capable of helping lotteries fulfill their mission of delivering revenue back to the beneficiaries they support. DraftKings’ proven reach and cutting-edge mobile platforms will continue to allow us to drive growth and innovation in the digital lottery vertical.”
With the acquisition now complete, DraftKings is focused on integrating Jackpocket into its operations and leveraging synergies to drive sustained growth and value creation. The Company remains committed to delivering an exceptional experience to its customers while advancing its mission of responsibly providing safe, innovative, and engaging real-money gaming offerings.
About DraftKings
DraftKings Inc. is a digital sports entertainment and gaming company created to be the Ultimate Host and fuel the competitive spirit of sports fans with products that range across daily fantasy, regulated gaming, and digital media. Headquartered in Boston and launched in 2012 by Jason Robins, Matt Kalish and Paul Liberman, DraftKings is the only U.S.-based vertically integrated sports betting operator. DraftKings’ mission is to make life more exciting by responsibly creating the world’s favorite real-money games and betting experiences. DraftKings Sportsbook is live with mobile and/or retail sports betting operations pursuant to regulations in 27 states and in Ontario, Canada. The Company operates iGaming pursuant to regulations in five states and in Ontario, Canada under its DraftKings brand and pursuant to regulations in three states under its Golden Nugget Online Gaming brand. DraftKings owns Jackpocket, the leading digital lottery app in the United States. DraftKings’ daily fantasy sports product is available in 44 states, certain Canadian provinces, and the United Kingdom. DraftKings is both an official daily fantasy and sports betting partner of the NFL, NHL, PGA TOUR, and UFC, as well as an official daily fantasy partner of NASCAR, an official sports betting partner of the NBA and an authorized gaming operator of MLB. In addition, DraftKings owns and operates both DraftKings Network and Vegas Sports Information Network (VSiN), to provide a multi-platform content ecosystem with original programming. DraftKings is committed to being a responsible steward of this new era in real-money gaming with a Company-wide focus on responsible gaming and corporate social responsibility.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, including statements about the Company, Jackpocket and their respective industries that involve substantial risks and uncertainties. All statements, other than statements of historical fact, contained in this press release, including statements regarding DraftKings’ future results of operations or financial condition, strategic plans and focus, user growth and engagement, product initiatives, and the objectives and expectations of management for future operations (including launches in new jurisdictions and the expected timing thereof), are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as “anticipate,” “believe,” “confident,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “forecast,” “going to,” “intend,” “may,” “plan,” “poised,” “potential,” “predict,” “project,” “propose,” “should,” “target,” “will,” or “would” or the negative of these words or other similar terms or expressions. DraftKings cautions you that the foregoing may not include all of the forward-looking statements made in this press release.
You should not rely on forward-looking statements as predictions of future events. DraftKings has based the forward-looking statements contained in this press release primarily on its current expectations and projections about future events and trends, including the current macroeconomic environment, that it believes may affect its business, financial condition, results of operations, and prospects. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside DraftKings’ control and that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, that may affect actual results or outcomes include, but are not limited to, the risk that DraftKings’ acquisition of Jackpocket disrupts current plans or operations; the ability to recognize the anticipated benefits of DraftKings’ acquisition of Jackpocket; DraftKings’ ability to execute its business plans and meet its projections; potential litigation involving DraftKings; changes in applicable laws or regulations, particularly with respect to online gaming, digital lottery courier or similar businesses; general economic and market conditions impacting demand for DraftKings’ products and services; economic and market conditions in the media, entertainment, gaming, lottery and software industries in the jurisdictions in which DraftKings operates; market and global conditions and economic factors, as well as the potential impact of general economic conditions, including inflation, rising interest rates and instability in the banking system, on DraftKings’ liquidity, operations and personnel, as well as the risks, uncertainties, and other factors described in “Risk Factors” in DraftKings’ filings with the Securities and Exchange Commission (the “SEC”), which are available on the SEC’s website at www.sec.gov. Additional information will be made available in other filings that DraftKings makes from time to time with the SEC. The forward-looking statements contained herein are based on DraftKings management’s current expectations and beliefs and speak only as of the date hereof, and DraftKings makes no commitment to update or publicly release any revisions to forward-looking statements in order to reflect new information or subsequent events, circumstances or changes in expectations, except as required by law.
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