Flutter Entertainment, owner of FanDuel and FOX Bet, has forecast that the total addressable market for its US brands will reach $25bn by 2025, a doubling of last year’s projections.
A preliminary results presentation on Tuesday heralded a “transformational year for the group,” which saw Flutter complete the acquisition of The Stars Group and commence operation in a number of new US states.
In FY2020, the company saw a 62% YOY increase in its US player base, and revenues rise by 81% to $695m. Flutter sportsbooks performed strongly among group verticals, and revenues grew 101%.
The upticks were attributed to four new state launches (FanDuel, four, FOX Bet, one), continued strong growth in existing states, and structural margin increase due to demand for higher margin products, as stated in the presentation.
Despite strong market performance and player share growth, Flutter’s US operations recorded an EBITDA loss of $170m due to investments in its rapid market expansion. Outlays included $348m in sales and marketing costs, an increase of 110%, and $198m in other operating costs.
The report stated that the US investment loss fell within guided range, and operations are still on course for profitability in the near future.
This outlook will be buoyed by US operations finishing the year strong; Q4 Pro forma revenue growth increased 101% YOY, and initial performances are currently exceeding company expectations.
FanDuel launched mid January in the key markets of Michigan and Virginia, and February’s Super Bowl drove 350,000 sportsbook and igaming new customer sign-ups.
2020 was a strong year for the group as a whole. Total revenue reached $7.38bn, a 28% YOY increase, adjusted for the acquisition of TSG last May. Overall adjusted Group EBITDA was $1.71bn, a 16% increase on 2019.
