Latest Q2 2020 report by DraftKings outlined revenue growth, despite the disrupted schedule of major sports leagues earlier this year. The company plans to enter the sports betting market of Virginia, Tennessee and Michigan.
DraftKings Plans Further Expansion on the U.S. Market
The latest report by the sports betting operator DraftKings outlined strong Q2 revenue despite the limited sports events globally. In the second quarter of 2020 which ended on June 30, the company expanded its presence significantly on the U.S. sports betting market. In Q2, Drafkings launched sports betting in Colorado and Illinois.
On the other hand, the company also launched iGaming in Pennsylvania and West Virginia. According to the most recent press release, DraftKings plans further expansion on the Virginia and Tennessee market for sports betting. In addition, the company said that it also plans to launch both iGaming and sports betting in Michigan.
DraftKings Co-Founder and CEO, Jason Robins commented by saying: “We believe that the best product will ultimately win with the American consumer.” Robins added that as a “technology first organization“, DraftKings will continue its focus on bringing innovative products to new markets. By doing so, the company will strengthen its engagement with customers and will keep the competitive differentiation, added Robins.
“The Company is well positioned to continue to deliver on its key priorities, which include entering new states,” said the company in a statement. Earlier this week, DraftKings became the first official retail sports book to launch in New Hampshire.
DraftKings Balance Sheets: $1.2 Billion in Cash and No Debt
Focusing on the financial results by DraftKings we observe a revenue increase in Q2 2020. The company reported revenue of $71 million compared to $57 million during the same period in 2019. This marked an increase of revenue of 24%. According to DraftKings’ latest report, the company ended the second quarter of 2020 with more than $1.2 billion in cash on its balance sheets and no debt.
Focusing on a six months period, DraftKings generated $159.5 million revenue in 2020. Here, we observe another year-on-year increase as results for the same period in 2019 showed $125.5 million in revenue. Looking at NET losses, results showed that the company lost $161.4 million in Q2 2020, while for the same period in 2019 it lost some $28.1 million.
Successful Q2 2020, despite the Major Sports Events Missing
The global COVID-19 spread impacted all of the major sports leagues earlier this year. The major leagues like the NBA, Major League Baseball (MLB) and the National Hockey League (NHL) postponed their activities because of the pandemic. Even the 2020 Tokyo Olympics were postponed to next year because of the novel coronavirus (COVID-19).
With that in mind, the sports betting operators had to find a way to continue their activities. DraftKings saw this as an opportunity and worked creatively to engage fans with new fantasy sports and betting products for NASCAR, golf, UFC, and European soccer.
Over the last two months, more major sports events resumed their activities and DraftKings marked an increase of its sports betting offering. A significant revenue boost was observed by the company with the return of the MLB, the NBA, WNBA, the NHL, and Major League Soccer (MLS).