DraftKings reported a steeper-than-expected loss as live sports events were canceled worldwide, but played down concerns that the coronavirus crisis will cripple its betting business in the longer term.
In its first earnings report as a public company, the online sports-betting behemoth — which went public last month via a blank-check company merger — reported a loss of $68.7 million, or 18 cents per share. Wall Street had been expecting a loss of 13 cents per share.
With all American sports leagues — and most major sports leagues around the world — suspended due to the coronavirus, the company has seen its ability to pull in revenue severely crimped. DraftKings reported a 30 percent revenue jump from a year ago, to $88.5 million.
Including combined operations from the recent, three-way merger of DraftKings, SBTech and Diamond Eagle Acquisition Corp., the company had a loss of $74 million on revenue of $113 million, beating analysts’ forecasts for revenue just short of $100 million.
In the meantime, DraftKings has set up free pools and contests tied to popular TV shows including the viral Netflix series “Tiger King” along with reality programs “Survivor” and “Top Chef.” Its customers can also engage with “esports” events like simulated NASCAR races and the online video game “League of Legends.”
In a statement, DraftKings said that it expects the pain related to the sports shutdown to be temporary and that it “does not anticipate an impact to FY2021 or long-term plans due to COVID-19.”
DraftKings is partly banking its future on a sportsbook that’s currently active in New York, New Jersey and six other states. The company aims to expand the business into more states once the virus crisis subsides and lawmakers have the bandwidth to take up sports betting legislation, according to CEO Jason Robins.
Shares of DraftKings were up 1.7 percent at $25.74 in early Friday trading.
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