DraftKings Reports Fourth Quarter and Fiscal Year 2024 Results
DraftKings (DKNG) reported Q4 2024 revenue of $1,393 million, up 13% from $1,231 million in Q4 2023. The company raised its 2025 revenue guidance midpoint to $6.45 billion and reaffirmed Adjusted EBITDA guidance of $900 million to $1.0 billion.
Monthly Unique Payers increased 36% to 4.8 million in Q4 2024, while Average Revenue per MUP decreased 16% to $97. The revenue growth was driven by customer engagement, new customer acquisition, Sportsbook expansion, higher structural hold percentage, and the Jackpocket acquisition, partially offset by customer-friendly NFL outcomes.
DraftKings achieved its first year of positive Adjusted EBITDA in 2024 and began executing share repurchases. The company is live with mobile sports betting in 25 states plus Washington D.C., representing 49% of the U.S. population, and iGaming in 5 states covering 11% of the population.
DraftKings (DKNG) ha riportato un fatturato nel Q4 2024 di 1.393 milioni di dollari, in aumento del 13% rispetto ai 1.231 milioni di dollari nel Q4 2023. L'azienda ha innalzato il punto medio delle previsioni di fatturato per il 2025 a 6,45 miliardi di dollari e ha confermato le previsioni di EBITDA rettificato tra 900 milioni e 1,0 miliardi di dollari.
Il numero di Payers Unici Mensili è aumentato del 36% a 4,8 milioni nel Q4 2024, mentre il Ricavo Medio per MUP è diminuito del 16% a 97 dollari. La crescita del fatturato è stata guidata dal coinvolgimento dei clienti, dall'acquisizione di nuovi clienti, dall'espansione del Sportsbook, da una percentuale di vincita strutturale più alta e dall'acquisizione di Jackpocket, parzialmente compensata da risultati NFL favorevoli per i clienti.
DraftKings ha raggiunto il suo primo anno di EBITDA rettificato positivo nel 2024 e ha iniziato a eseguire riacquisti di azioni. L'azienda è attiva con scommesse sportive mobili in 25 stati più Washington D.C., coprendo il 49% della popolazione statunitense, e iGaming in 5 stati che coprono l'11% della popolazione.
DraftKings (DKNG) reportó ingresos de $1,393 millones en el Q4 2024, un aumento del 13% respecto a los $1,231 millones en el Q4 2023. La compañía elevó su guía de ingresos para 2025 a un punto medio de $6.45 mil millones y reafirmó la guía de EBITDA ajustado de $900 millones a $1.0 mil millones.
Los Pagadores Únicos Mensuales aumentaron un 36% a 4.8 millones en el Q4 2024, mientras que el Ingreso Promedio por MUP disminuyó un 16% a $97. El crecimiento de los ingresos fue impulsado por el compromiso del cliente, la adquisición de nuevos clientes, la expansión de Sportsbook, un mayor porcentaje de retención estructural y la adquisición de Jackpocket, parcialmente compensado por resultados favorables para los clientes en la NFL.
DraftKings logró su primer año de EBITDA ajustado positivo en 2024 y comenzó a ejecutar recompras de acciones. La empresa está activa en apuestas deportivas móviles en 25 estados más Washington D.C., lo que representa el 49% de la población de EE. UU., y en iGaming en 5 estados cubriendo el 11% de la población.
DraftKings (DKNG)는 2024년 4분기 수익이 13억 9,300만 달러로 2023년 4분기 12억 3,100만 달러에서 13% 증가했다고 보고했습니다. 회사는 2025년 수익 가이던스 중간값을 64억 5천만 달러로 상향 조정했으며, 조정 EBITDA 가이던스를 9억 달러에서 10억 달러로 재확인했습니다.
월간 고유 결제자는 2024년 4분기 480만 명으로 36% 증가했으며, 평균 MUP당 수익은 16% 감소하여 97달러가 되었습니다. 수익 성장에는 고객 참여, 신규 고객 확보, 스포츠북 확장, 구조적 보유 비율 증가, Jackpocket 인수 등이 기여했으며, 고객 친화적인 NFL 결과로 인해 부분적으로 상쇄되었습니다.
DraftKings는 2024년에 조정 EBITDA가 처음으로 긍정적인 해를 기록했으며, 자사주 매입을 시작했습니다. 회사는 25개 주와 워싱턴 D.C.에서 모바일 스포츠 베팅을 운영하고 있으며, 이는 미국 인구의 49%를 차지하고, 5개 주에서 iGaming을 제공하여 인구의 11%를 커버하고 있습니다.
DraftKings (DKNG) a annoncé un chiffre d'affaires de 1,393 milliard de dollars pour le Q4 2024, en hausse de 13 % par rapport à 1,231 milliard de dollars au Q4 2023. L'entreprise a relevé son objectif de chiffre d'affaires pour 2025 à un point médian de 6,45 milliards de dollars et a confirmé ses prévisions d'EBITDA ajusté entre 900 millions et 1,0 milliard de dollars.
Le nombre de Payers Uniques Mensuels a augmenté de 36 % pour atteindre 4,8 millions au Q4 2024, tandis que le Revenu Moyen par MUP a diminué de 16 % pour s'établir à 97 dollars. La croissance des revenus a été soutenue par l'engagement des clients, l'acquisition de nouveaux clients, l'expansion du Sportsbook, un pourcentage de maintien structurel plus élevé et l'acquisition de Jackpocket, partiellement compensée par des résultats favorables à la NFL pour les clients.
DraftKings a atteint sa première année d'EBITDA ajusté positif en 2024 et a commencé à exécuter des rachats d'actions. L'entreprise est active dans les paris sportifs mobiles dans 25 États plus Washington D.C., représentant 49 % de la population américaine, et dans le iGaming dans 5 États couvrant 11 % de la population.
DraftKings (DKNG) berichtete im Q4 2024 einen Umsatz von 1.393 Millionen Dollar, was einem Anstieg von 13% gegenüber 1.231 Millionen Dollar im Q4 2023 entspricht. Das Unternehmen hob seine Umsatzprognose für 2025 auf einen Mittelwert von 6,45 Milliarden Dollar an und bestätigte die Prognose für das bereinigte EBITDA von 900 Millionen bis 1,0 Milliarden Dollar.
Die monatlichen einzigartigen Zahler stiegen im Q4 2024 um 36% auf 4,8 Millionen, während der durchschnittliche Umsatz pro MUP um 16% auf 97 Dollar fiel. Das Umsatzwachstum wurde durch Kundenengagement, Neukundengewinnung, Expansion des Sportsbooks, einen höheren strukturellen Halteprozentsatz und die Akquisition von Jackpocket vorangetrieben, teilweise ausgeglichen durch kundenfreundliche NFL-Ergebnisse.
DraftKings erzielte 2024 sein erstes Jahr mit positivem bereinigtem EBITDA und begann mit Aktienrückkäufen. Das Unternehmen ist in 25 Bundesstaaten sowie Washington D.C. mit mobilen Sportwetten aktiv, was 49% der US-Bevölkerung repräsentiert, und bietet iGaming in 5 Bundesstaaten an, die 11% der Bevölkerung abdecken.
- Revenue increased 13% YoY to $1,393M in Q4 2024
- Monthly Unique Payers grew 36% to 4.8M in Q4 2024
- Achieved first year of positive Adjusted EBITDA in 2024
- Raised 2025 revenue guidance midpoint to $6.45B
- Expanded mobile sports betting presence to 25 states
- Average Revenue per MUP decreased 16% to $97 in Q4 2024
- Customer-friendly NFL outcomes negatively impacted results
- Net loss of $134.8M in Q4 2024
Insights
The Q4 results reveal DraftKings' successful execution of its growth and profitability strategy. The 13% revenue growth to $1.393B demonstrates robust business momentum, particularly noteworthy given the headwinds from customer-friendly sports outcomes. The company's ability to raise 2025 revenue guidance while maintaining Adjusted EBITDA targets signals strong underlying business fundamentals.
The user metrics tell an important story: The 36% growth in Monthly Unique Payers to 4.8M (16% organic growth excluding Jackpocket) reflects successful market expansion and customer acquisition strategies. While the ARPMUP decline of 16% to $97 might appear concerning, it's primarily attributed to the Jackpocket acquisition's different customer profile and temporary sports betting margin pressure, rather than core business deterioration.
Two critical developments underscore DraftKings' maturing business model: First, achieving positive Adjusted EBITDA in 2024 marks a pivotal transition toward sustainable profitability. Second, the initiation of share repurchases indicates management's confidence in cash flow generation and capital allocation discipline.
The company's strategic focus on enhancing live betting capabilities and cross-sell initiatives positions it well for future growth. With operations in 25 states representing 49% of the U.S. population for mobile sports betting, and 5 states (11% of population) for iGaming, substantial expansion opportunities remain, particularly with Missouri's recent legalization.
The balance sheet remains solid with $788.3M in cash and cash equivalents, providing ample liquidity for continued growth investments and market expansion. The structural improvements in sportsbook hold percentage, despite short-term outcome volatility, suggest strengthening underlying economics in the core business.
Raises 2025 Revenue Guidance Midpoint to
Reaffirms 2025 Adjusted EBITDA Guidance of
BOSTON, Feb. 13, 2025 (GLOBE NEWSWIRE) -- DraftKings Inc. (Nasdaq: DKNG) (“DraftKings” or the “Company”) today announced its fourth quarter and fiscal year 2024 financial results. The Company also posted a letter to shareholders and an earnings presentation on the Investor Relations section of its website at investors.draftkings.com.
Fourth Quarter 2024 Highlights
For the three months ended December 31, 2024, DraftKings reported revenue of
“We continued to efficiently acquire and engage customers, expand structural sportsbook hold percentage and optimize promotional reinvestment in fiscal year 2024, while we simultaneously experienced customer-friendly sport outcomes,” said Jason Robins, DraftKings’ Chief Executive Officer and Co-founder. “Looking ahead to 2025 and beyond, I am excited to further enhance our customer economics through new initiatives such as extending our lead in live betting and advancing cross sell efforts to and from new verticals. Our focus remains on driving sustainable growth in revenue and profitability.”
“2024 was a milestone year for DraftKings as we achieved our first year of positive Adjusted EBITDA. Additionally, we began executing on our inaugural share repurchase authorization,” said Alan Ellingson, DraftKings’ Chief Financial Officer. “With strong underlying health across our core value drivers, we are raising the midpoint of our fiscal year 2025 revenue guidance to
Continued Healthy Growth in Customer Retention, Acquisition, and Engagement
- Monthly Unique Payers (“MUPs”) increased to 4.8 million average monthly unique paying customers in the fourth quarter of 2024, representing an increase of
36% compared to the fourth quarter of 2023. This increase reflects strong unique player acquisition and retention across DraftKings’ Sportsbook and iGaming products, the expansion of its Sportsbook product into new jurisdictions and the impact of the acquisition of Jackpocket. Excluding the impact of the acquisition of Jackpocket, MUPs increased by approximately16% compared to the fourth quarter of 2023.
- Average Revenue per MUP (“ARPMUP”) was
$97 in the fourth quarter of 2024, representing a16% decrease compared to the same period in 2023. The decrease was primarily due to lower ARPMUP for Jackpocket customers, when compared to customers of DraftKings’ existing product offerings prior to the acquisition, as well as lower actual Sportsbook hold rate due to customer-friendly sport outcomes, which was partially offset by improvement in the Company’s structural Sportsbook hold and improved promotional reinvestment for Sportsbook and iGaming. Excluding the impact of the acquisition of Jackpocket, ARPMUP decreased approximately4% compared to the fourth quarter of 2023.
- Detailed financial data and other information for the fourth quarter of 2024 is available in the financial statements set forth below under the caption “Financial Results.”
Fiscal Year 2025 Guidance
- DraftKings is raising the midpoint of its fiscal year 2025 revenue guidance and now expects revenue in the range of
$6.3 billion to$6.6 billion , compared to its previous guidance of$6.2 billion to$6.6 billion announced on November 7, 2024. Our fiscal year 2025 revenue guidance equates to approximately35% year-over-year growth based on the Company’s fiscal year 2024 revenue and the midpoint of the Company’s fiscal year 2025 revenue guidance range.
- DraftKings is reaffirming its fiscal year 2025 Adjusted EBITDA guidance of
$900 million to$1.0 billion , which the Company previously announced on November 7, 2024.
- The Company’s guidance for fiscal year 2025 does not include the benefit of year-to-date sport outcomes.
- The Company’s guidance for fiscal year 2025 includes all of its existing jurisdictions and does not include the impact of mobile sports betting launching in Missouri.
Mobile Sports Betting and iGaming Footprint
- DraftKings is live with mobile sports betting in 25 states and Washington, D.C. which collectively represent approximately
49% of the U.S. population.
- DraftKings is also live with iGaming in 5 states, representing approximately
11% of the U.S. population.
- DraftKings is live with its Sportsbook and iGaming products in Ontario, Canada, which represents approximately
40% of Canada’s population.
- On November 5, 2024, Missouri voters passed a ballot initiative that legalized sports betting in the state. DraftKings expects to launch its Sportsbook product in Missouri pending market access, licensure, regulatory approvals, and contractual approvals where applicable.
- DraftKings expects to launch its Sportsbook product in Puerto Rico pending market access, licensure, regulatory approvals, and contractual approvals where applicable.
Webcast and Conference Call Details
As previously announced, DraftKings will host a conference call and audio webcast tomorrow, Friday, February 14, 2025, from 8:30 a.m. to 9:15 a.m. ET, during which management will discuss the Company’s results and provide commentary on business performance. A question-and-answer session will follow the prepared remarks.
To listen to the audio webcast and live question and answer session, please visit DraftKings’ investor relations website at investors.draftkings.com. A live audio webcast of the earnings conference call will be available on the Company’s website at investors.draftkings.com, along with a copy of this press release, the Company’s Annual Report on Form 10-K, an earnings presentation and a letter to shareholders. The audio webcast will be available on the Company’s investor relations website until 11:59 p.m. ET on March 31, 2025.
Financial Results
DraftKings’ fourth quarter and full-year 2024 financial results, as well as the financial results for the respective comparative periods, are presented below:
| DRAFTKINGS INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except par value) | |||||||
| December 31, | |||||||
| 2024 | 2023 | ||||||
| Assets | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 788,287 | $ | 1,270,503 | |||
| Restricted cash | 16,499 | 11,700 | |||||
| Cash reserved for users | 525,407 | 341,290 | |||||
| Receivables reserved for users | 62,542 | 301,770 | |||||
| Accounts receivable | 57,839 | 47,539 | |||||
| Prepaid expenses and other current assets | 83,187 | 98,565 | |||||
| Total current assets | 1,533,761 | 2,071,367 | |||||
| Property and equipment, net | 50,550 | 60,695 | |||||
| Intangible assets, net | 933,121 | 690,620 | |||||
| Goodwill | 1,555,116 | 886,373 | |||||
| Operating lease right-of-use assets | 74,917 | 93,985 | |||||
| Equity method investments | 13,200 | 10,280 | |||||
| Deposits and other non-current assets | 123,060 | 131,546 | |||||
| Total assets | $ | 4,283,725 | $ | 3,944,866 | |||
| Liabilities and Stockholders’ equity | |||||||
| Current liabilities: | |||||||
| Accounts payable and accrued expenses | $ | 661,245 | $ | 639,599 | |||
| Liabilities to users | 979,453 | 851,898 | |||||
| Operating lease liabilities, current portion | 10,993 | 11,499 | |||||
| Other current liabilities | 3,300 | 46,624 | |||||
| Total current liabilities | 1,654,991 | 1,549,620 | |||||
| Convertible notes, net of issuance costs | 1,256,429 | 1,253,760 | |||||
| Non-current operating lease liabilities | 67,660 | 80,827 | |||||
| Warrant liabilities | 22,033 | 63,568 | |||||
| Long-term income tax liabilities | 76,375 | 72,810 | |||||
| Other long-term liabilities | 195,611 | 83,975 | |||||
| Total liabilities | $ | 3,273,099 | $ | 3,104,560 | |||
| Stockholders’ equity: | |||||||
| Class A common stock, | 48 | 46 | |||||
| Class B common stock, | 39 | 39 | |||||
| Treasury stock, at cost; 15,651 and 11,901 shares as of December 31, 2024 and 2023, respectively | (563,146 | ) | (412,182 | ) | |||
| Additional paid-in capital | 7,978,425 | 7,149,858 | |||||
| Accumulated deficit | (6,441,228 | ) | (5,933,943 | ) | |||
| Accumulated other comprehensive income | 36,488 | 36,488 | |||||
| Total stockholders’ equity | 1,010,626 | 840,306 | |||||
| Total liabilities and stockholders’ equity | $ | 4,283,725 | $ | 3,944,866 | |||
| DRAFTKINGS INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Amounts in thousands, except per share data) | |||||||||||||||
| Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Revenue | $ | 1,392,772 | $ | 1,230,857 | $ | 4,767,699 | $ | 3,665,393 | |||||||
| Cost of revenue | 834,644 | 716,658 | 2,950,561 | 2,292,175 | |||||||||||
| Sales and marketing | 368,602 | 290,775 | 1,264,920 | 1,200,718 | |||||||||||
| Product and technology | 112,063 | 88,157 | 397,114 | 355,156 | |||||||||||
| General and administrative | 216,642 | 179,076 | 764,103 | 606,569 | |||||||||||
| Loss from operations | (139,179 | ) | (43,809 | ) | (608,999 | ) | (789,225 | ) | |||||||
| Other income (expense): | |||||||||||||||
| Interest income | 8,780 | 18,792 | 47,259 | 58,418 | |||||||||||
| Interest expense | (760 | ) | (688 | ) | (2,959 | ) | (2,679 | ) | |||||||
| (Loss) gain on remeasurement of warrant liabilities | 3,337 | (12,716 | ) | (4,945 | ) | (57,543 | ) | ||||||||
| Other (loss) gain, net | (17,713 | ) | 929 | (23,514 | ) | (224 | ) | ||||||||
| Loss before income tax (benefit) provision and loss from equity method investment | (145,535 | ) | (37,492 | ) | (593,158 | ) | (791,253 | ) | |||||||
| Income tax (benefit) provision | (11,133 | ) | 6,860 | (86,341 | ) | 10,170 | |||||||||
| Loss from equity method investment | 449 | 269 | 468 | 719 | |||||||||||
| Net loss attributable to common stockholders | $ | (134,851 | ) | $ | (44,621 | ) | $ | (507,285 | ) | $ | (802,142 | ) | |||
| Loss per share attributable to common stockholders: | |||||||||||||||
| Basic and diluted | $ | (0.28 | ) | $ | (0.10 | ) | $ | (1.05 | ) | $ | (1.73 | ) | |||
| DRAFTKINGS INC. NON-GAAP FINANCIAL MEASURES (Unaudited) (Amounts in thousands, except per share data) | ||||||||||||
| | Three Months Ended December 31, | Year Ended December 31, | ||||||||||
| | 2024 | 2023 | 2024 | 2023 | ||||||||
| Adjusted EBITDA | $ | 89,454 | $ | 151,018 | $ | 181,307 | $ | (151,035 | ) | |||
| Adjusted Earnings (Loss) Per Share | $ | 0.14 | $ | 0.29 | $ | 0.24 | $ | (0.41 | ) | |||
| DRAFTKINGS INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Amounts in thousands) | |||||||
| Year Ended December 31, | |||||||
| 2024 | 2023 | ||||||
| Cash Flows from Operating Activities: | |||||||
| Net loss attributable to common shareholders | $ | (507,285 | ) | $ | (802,142 | ) | |
| Adjustments to reconcile net loss to net cash flows provided by (used in) operating activities: | |||||||
| Depreciation and amortization | 270,854 | 201,920 | |||||
| Non-cash interest (income) expense, net | (15 | ) | 386 | ||||
| Stock-based compensation | 381,367 | 398,463 | |||||
| Loss (gain) on remeasurement of warrant liabilities | 4,945 | 57,543 | |||||
| Loss from equity method investment | 468 | 719 | |||||
| Loss (gain) on marketable equity securities and other financial assets, net | 12,940 | 75 | |||||
| Loss on sale of Vegas Sports Information Network, LLC | 5,865 | — | |||||
| Deferred income taxes | (92,733 | ) | 5,849 | ||||
| Other expenses (income), net | 6,280 | 554 | |||||
| Change in operating assets and liabilities, net of effect of acquisitions: | |||||||
| Receivables reserved for users | 248,320 | (141,687 | ) | ||||
| Accounts receivable | (10,116 | ) | 3,558 | ||||
| Prepaid expenses and other current assets | (26,266 | ) | 2,451 | ||||
| Deposits and other non-current assets | 1,701 | (19,355 | ) | ||||
| Operating leases, net | 130 | 6,558 | |||||
| Accounts payable and accrued expenses | (18,200 | ) | 103,593 | ||||
| Liabilities to users | 110,678 | 165,725 | |||||
| Long-term income tax liability | 3,565 | 2,952 | |||||
| Other long-term liabilities | 25,269 | 11,087 | |||||
| Net cash flows provided by (used in) operating activities | 417,767 | (1,751 | ) | ||||
| Cash Flows from Investing Activities: | |||||||
| Purchases of property and equipment | (10,176 | ) | (20,902 | ) | |||
| Cash paid for internally developed software costs | (95,698 | ) | (80,378 | ) | |||
| Acquisition of gaming licenses | (14,983 | ) | (12,105 | ) | |||
| Proceeds from marketable equity securities and other financial assets | — | 24,425 | |||||
| Cash paid for acquisitions, net of cash acquired | (441,487 | ) | — | ||||
| Other investing activities, net | (4,257 | ) | (1,400 | ) | |||
| Net cash flows used in investing activities | (566,601 | ) | (90,360 | ) | |||
| Cash Flow from Financing Activities: | |||||||
| Proceeds from exercise of warrants | — | 288 | |||||
| Purchase of treasury stock for RSU withholding | (102,897 | ) | (80,049 | ) | |||
| Purchase of treasury stock under Stock Repurchase Program | (48,067 | ) | — | ||||
| Proceeds from exercise of stock options | 9,165 | 16,540 | |||||
| Other financing activities | (2,667 | ) | — | ||||
| Net cash flows used in financing activities | (144,466 | ) | (63,221 | ) | |||
| Net decrease in cash and cash equivalents, restricted cash, and cash reserved for users | (293,300 | ) | (155,332 | ) | |||
| Cash and cash equivalents, restricted cash, and cash reserved for users at the beginning of period | 1,623,493 | 1,778,825 | |||||
| Cash and cash equivalents, restricted cash, and cash reserved for users at the end of period | $ | 1,330,193 | $ | 1,623,493 | |||
| Disclosure of cash and cash equivalents, restricted cash, and cash reserved for users | |||||||
| Cash and cash equivalents | $ | 788,287 | $ | 1,270,503 | |||
| Restricted cash | 16,499 | 11,700 | |||||
| Cash reserved for users | 525,407 | 341,290 | |||||
| Cash and cash equivalents, restricted cash, and cash reserved for users at the end of period | $ | 1,330,193 | $ | 1,623,493 | |||
| Supplemental Disclosure of Noncash Investing and Financing Activities: | |||||||
| Investing activities included in accounts payable and accrued expenses | 3,462 | 569 | |||||
| Equity consideration issued in connection with acquisitions | 376,702 | — | |||||
| Fair value of contingent consideration in connection with acquisitions | 77,965 | — | |||||
| Decrease of warrant liabilities from cashless exercise of warrants | 46,484 | 4,654 | |||||
| Supplemental Disclosure of Cash Activities: | |||||||
| Increase (decrease) in cash reserved for users | 184,117 | (128,363 | ) | ||||
| Cash paid for income taxes | 5,268 | 8,341 | |||||
Non-GAAP Financial Measures
This press release includes Adjusted EBITDA and Adjusted Earnings (Loss) Per Share, which are non-GAAP financial measures that DraftKings uses to supplement its results presented in accordance with U.S. generally accepted accounting principles (“GAAP”). The Company believes Adjusted EBITDA and Adjusted Earnings (Loss) Per Share are useful in evaluating its operating performance, similar to measures reported by its publicly-listed U.S. competitors, and regularly used by security analysts, institutional investors and other interested parties in analyzing operating performance and prospects. Adjusted EBITDA and Adjusted Earnings (Loss) Per Share are not intended to be substitutes for any GAAP financial measures, and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry.
DraftKings defines and calculates Adjusted EBITDA as net income (loss) before the impact of interest income or expense (net), income tax provision or benefit, and depreciation and amortization, and further adjusted for the following items: stock-based compensation; transaction-related costs; litigation, settlement and related costs; advocacy and other related legal expenses; gain or loss on remeasurement of warrant liabilities; and other non-recurring and non-operating costs or income, as described in the reconciliation below.
DraftKings defines and calculates Adjusted Earnings (Loss) Per Share as basic earnings (loss) per share attributable to common stockholders before the impact of amortization of acquired intangible assets; stock-based compensation; transaction-related costs; litigation, settlement and related costs; advocacy and other related legal expenses; gain or loss on remeasurement of warrant liabilities; and other non-recurring and non-operating costs or income, as described in the reconciliation below.
DraftKings includes these non-GAAP financial measures because they are used by management to evaluate the Company’s core operating performance and trends and to make strategic decisions regarding the allocation of capital and new investments. Adjusted EBITDA and Adjusted Earnings (Loss) Per Share exclude certain expenses that are required in accordance with GAAP because they are non-recurring items (for example, in the case of transaction-related costs and advocacy and other related legal expenses), non-cash expenditures (for example, in the case of amortization of acquired intangible assets, depreciation and amortization, remeasurement of warrant liabilities and stock-based compensation), or non-operating items which are not related to the Company’s underlying business performance (for example, in the case of interest income and expense and litigation, settlement and related costs).
The unaudited table below presents the Company’s Adjusted EBITDA reconciled to its net income (loss), which is the most directly comparable financial measure calculated in accordance with GAAP, for the periods indicated:
| Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||
| (amounts in thousands) | 2024 | 2023 | 2024 | 2023 | |||||||||||
| Net loss | $ | (134,851 | ) | $ | (44,621 | ) | $ | (507,285 | ) | $ | (802,142 | ) | |||
| Adjusted for: | |||||||||||||||
| Depreciation and amortization(1) | 66,099 | 55,198 | 270,854 | 201,920 | |||||||||||
| Interest (income) expense, net | (8,019 | ) | (18,104 | ) | (44,299 | ) | (55,739 | ) | |||||||
| Income tax (benefit) provision(2) | (11,133 | ) | 6,860 | (86,341 | ) | 10,170 | |||||||||
| Stock-based compensation(3) | 110,060 | 113,517 | 381,367 | 398,463 | |||||||||||
| Transaction-related costs(4) | 2,053 | 1,954 | 26,386 | 3,060 | |||||||||||
| Litigation, settlement, and related costs(5) | 40,674 | 23,910 | 81,246 | 34,500 | |||||||||||
| Advocacy and other related legal expenses(6) | 9,746 | — | 16,049 | — | |||||||||||
| (Gain) loss on remeasurement of warrant liabilities | (3,337 | ) | 12,716 | 4,945 | 57,543 | ||||||||||
| Other non-recurring and non-operating costs (income)(7) | 18,162 | (412 | ) | 38,385 | 1,190 | ||||||||||
| Adjusted EBITDA | $ | 89,454 | $ | 151,018 | $ | 181,307 | $ | (151,035 | ) | ||||||
_________________________
| (1) | The amounts include the amortization of acquired intangible assets of | |
| (2) | The Company recorded a discrete income tax benefit of | |
| (3) | Reflects stock-based compensation expenses resulting from the issuance of awards under incentive plans. | |
| (4) | Includes capital markets advisory, consulting, accounting and legal expenses related to the evaluation, negotiation, and consummation of transactions and offerings that are under consideration, pending, or completed, as well as integration costs related to acquisitions. | |
| (5) | Primarily includes external legal costs related to litigation and litigation settlement costs deemed unrelated to our core business operations. | |
| (6) | Reflects non-recurring and non-ordinary course costs relating to advocacy efforts and other legal expenses in jurisdictions where we do not operate certain product offerings and are actively seeking licensure, or similar approval, for those product offerings. This adjustment excludes (i) costs relating to advocacy efforts and other legal expenses in jurisdictions where we do not operate that are incurred in the ordinary course of business and (ii) costs relating to advocacy efforts and other legal expenses incurred in jurisdictions where related legislation has been passed and we currently operate. | |
| (7) | Includes the change in fair value of certain financial assets, as well as our equity method share of investee’s losses and other costs relating to non-recurring and non-operating items. For 2024, this amount includes a | |
The unaudited table below presents the Company’s Adjusted Earnings (Loss) Per Share reconciled to its basic earnings (loss) per share attributable to common stockholders, which is the most directly comparable financial measure calculated in accordance with GAAP, for the periods indicated:
| | Three Months Ended December 31, | Year Ended December 31, | |||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Basic loss per share attributable to common stockholders | $ | (0.28 | ) | $ | (0.10 | ) | $ | (1.05 | ) | $ | (1.73 | ) | |||
| Adjusted for: | |||||||||||||||
| Amortization of acquired intangible assets(1) | 0.08 | 0.06 | 0.33 | 0.25 | |||||||||||
| Discrete tax benefit attributed to acquisitions(2) | (0.02 | ) | — | (0.18 | ) | — | |||||||||
| Stock-based compensation(3) | 0.23 | 0.24 | 0.79 | 0.86 | |||||||||||
| Transaction-related costs(4) | — | — | 0.05 | 0.01 | |||||||||||
| Litigation, settlement, and related costs(5) | 0.08 | 0.05 | 0.17 | 0.07 | |||||||||||
| Advocacy and other related legal expenses(6) | 0.02 | — | 0.03 | — | |||||||||||
| (Gain) loss on remeasurement of warrant liabilities | (0.01 | ) | 0.03 | 0.01 | 0.12 | ||||||||||
| Other non-recurring and non-operating costs (income)(7) | 0.04 | — | 0.08 | — | |||||||||||
| Adjusted Earnings (Loss) Per Share* | $ | 0.14 | $ | 0.29 | $ | 0.24 | $ | (0.41 | ) | ||||||
_________________________
| * | The weighted average number of shares used to calculate Adjusted Earnings (Loss) Per Share was 488.0 million and 468.1 million for the three months ended December 31, 2024 and 2023, respectively, and 482.0 million and 462.6 million for the year ended December 31, 2024, respectively. Totals may not sum due to rounding. | |
| (1) | The amounts include the amortization of acquired intangible assets of | |
| (2) | The Company recorded a discrete income tax benefit of | |
| (3) | Reflects stock-based compensation expenses resulting from the issuance of awards under incentive plans. | |
| (4) | Includes capital markets advisory, consulting, accounting and legal expenses related to the evaluation, negotiation, and consummation of transactions and offerings that are under consideration, pending, or completed, as well as integration costs related to acquisitions. | |
| (5) | Primarily includes external legal costs related to litigation and litigation settlement costs deemed unrelated to our core business operations. | |
| (6) | Reflects non-recurring and non-ordinary course costs relating to advocacy efforts and other legal expenses in jurisdictions where we do not operate certain product offerings and are actively seeking licensure, or similar approval, for those product offerings. This adjustment excludes (i) costs relating to advocacy efforts and other legal expenses in jurisdictions where we do not operate that are incurred in the ordinary course of business and (ii) costs relating to advocacy efforts and other legal expenses incurred in jurisdictions where related legislation has been passed and we currently operate. | |
| (7) | Includes the change in fair value of certain financial assets, as well as our equity method share of investee’s losses and other costs relating to non-recurring and non-operating items. For 2024, this amount includes a | |
Information reconciling forward-looking fiscal year 2025 Adjusted EBITDA guidance to its most directly comparable GAAP financial measure, net income (loss), is unavailable to DraftKings without unreasonable effort due to, among other things, certain items required for such reconciliations being outside of DraftKings’ control and/or not being able to be reasonably predicted. Preparation of such reconciliations would require a forward-looking balance sheet, statement of income and statement of cash flow, prepared in accordance with GAAP, and such forward-looking financial statements are unavailable to the Company without unreasonable effort. DraftKings provides a range for its Adjusted EBITDA forecast that it believes will be achieved; however, the Company cannot provide any assurance that it can predict all of the components of the Adjusted EBITDA calculation. DraftKings provides a forecast for Adjusted EBITDA because it believes that Adjusted EBITDA, when viewed with DraftKings’ results calculated in accordance with GAAP, provides useful information for the reasons noted above. However, Adjusted EBITDA is not a measure of financial performance or liquidity under GAAP and, accordingly, should not be considered as an alternative to net income (loss) or cash flow from operating activities or as an indicator of operating performance or liquidity.
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 28 states, Washington, D.C., 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 four states under its Golden Nugget Online Gaming brand. DraftKings also owns Jackpocket, the leading digital lottery courier app in the United States. DraftKings’ daily fantasy sports product is available in 44 states and certain Canadian provinces. DraftKings is both an official daily fantasy and sports betting partner of the NFL, NHL, PGA TOUR, WNBA 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 DraftKings Network a multi-platform content ecosystem. DraftKings is committed to being a responsible steward of this new era in real-money gaming by developing and promoting educational information and tools to help all players enjoy our games responsibly.
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 and its industry that involve substantial risks and uncertainties. All statements, other than statements of historical fact, contained in this press release, including statements regarding guidance, 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, DraftKings’ ability to manage growth; DraftKings’ ability to execute its business plan and meet its projections; potential litigation involving DraftKings; changes in applicable laws or regulations, particularly with respect to gaming; general economic and market conditions impacting demand for DraftKings’ products and services; economic and market conditions in the media, entertainment, gaming, and software industries in the markets 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 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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