DraftKings reports 13% Q4 revenue growth driven by market expansion, customer engagement

DraftKings has released its financial results for the fourth quarter and full fiscal year of 2024, reporting a 13% year-over-year increase in Q4 revenue. The US sports betting giant recorded revenue of $1.39 billion for the quarter, an improvement from $1.23 billion in Q4 2023, driven by strong customer engagement, new market expansion, and its acquisition of Jackpocket in May 2024.

Despite favorable betting outcomes for customers during the NFL season, DraftKings raised its 2025 revenue guidance, now expecting between $6.3 billion and $6.6 billion, slightly above its previous midpoint forecast of $6.4 billion. The company also reaffirmed its Adjusted EBITDA guidance of $900 million to $1 billion for 2025.

The 2024 NFL season posed challenges for sportsbooks, with bettor-friendly outcomes reducing hold percentages across the industry. DraftKings acknowledged that customer-friendly results impacted its Q4 performance, though increased user acquisition and engagement partially offset the impact.

CEO Jason Robins

CEO Jason Robins explained the company’s strategy for long-term revenue and profitability growth, stating: “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 sports outcomes."

"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."

The company reported a significant increase in Monthly Unique Payers (MUPs), with an average of 4.8 million unique paying customers per month in Q4 2024. This marks a 36% increase compared to the same period in 2023, attributed to strong player acquisition, customer retention, new jurisdiction expansion, and the integration of Jackpocket into DraftKings’ platform.

However, Average Revenue per Monthly Unique Payer (ARPMUP) fell 16% to $97, primarily due to Jackpocket customers spending less than traditional DraftKings users on iGaming and sports betting products. Excluding the impact of the acquisition, ARPMUP declined by approximately 4% year-over-year, indicating a lower sportsbook hold percentage from favorable betting outcomes.

CFO Alan Ellingson

CFO Alan Ellingson noted the company's financial resilience and continued growth momentum: “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."

"With strong underlying health across our core value drivers, we are raising the midpoint of our fiscal year 2025 revenue guidance to $6.45 billion from $6.4 billion and reaffirming our fiscal year 2025 Adjusted EBITDA guidance range of $900 million to $1.0 billion.”

DraftKings has continued to grow its mobile sports betting footprint, now operating in 25 states and Washington, D.C., covering nearly 49% of the U.S. population. Additionally, the company offers iGaming in five states, representing 11% of the U.S. population. Internationally, DraftKings is active in Ontario, Canada, where its Sportsbook and iGaming offerings reach 40% of the Canadian population.

The company plans to launch mobile sports betting in Missouri and Puerto Rico, pending regulatory approvals and market access. Missouri voters approved sports betting legalization in November 2024, and DraftKings aims to enter the market once all licensing and contractual processes are completed.

DraftKings ended 2024 with cash and cash equivalents of $788.28 million, down from $1.27 billion a year earlier, while restricted cash rose to $16.49 million from $11.7 million. The company also commenced its $1 billion share repurchase program, originally announced in August 2024.