DraftKings Posts Record Q4 Earnings & Historic Stock Surge

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00:00And love is in the air in DraftKings.

00:02They made some big historic financial numbers

00:06during the big game, didn't they?

00:08Yeah, certainly, Craig.

00:09Thanks for having me.

00:10DraftKings just last night announced

00:12their quarter four earnings for 2024,

00:16as well as the full entire year outlook

00:18of kind of how they did

00:20and where they are gonna go going forward.

00:22But the big news here is that the stock market

00:25really loved what they heard.

00:26DraftKings right now is up to $53 a share

00:30on the stock exchange, which is its highest price

00:32it's been in three and a half years.

00:34So investors are really loving what they heard.

00:38Some of what they heard is that revenue

00:39was up 13% in the fourth quarter,

00:42which was ahead of Wall Street's expectations.

00:44And it was also the company's first ever full year

00:48of profit with $181 million in EBITDA,

00:52which was up from $151 million in losses last year.

00:56So for a long time,

00:58we've talked about these sports betting companies

00:59making these huge investments,

01:01asking Wall Street and their investors for more money.

01:04And you have your first year of one of the major ones

01:07really taking home a lot of profit,

01:10which is kind of interesting when you talk about

01:12what happened during the fourth quarter

01:14and this past season.

01:16NFL obviously is the most popular sport to bet on,

01:18but DraftKings as well as FanDuel and everybody else

01:22got just absolutely killed on NFL results.

01:26This was the first time in 40 years

01:29that favorites won 75% of their games in a week,

01:34at least 10 times.

01:35So that's 10 out of 17 weeks

01:37where the favorites just overwhelmingly won.

01:39And obviously the public loves to back favorites.

01:42So that's been kind of the,

01:44we talked about all NFL season

01:45was the public just keeps winning,

01:48but it's not a big concern for the stock market.

01:50They see that as what we call an industry headwind,

01:53just something that can happen.

01:55The fact that it's the first time it happened

01:57in about 40 years,

01:58people seem to be thinking that speaks less to the public

02:01necessarily getting better at sports betting

02:03and just kind of a random happenstance,

02:06crapshoot occurrence.

02:07So it's interesting that they posted such low hold

02:11and bad results in the NFL,

02:13but Wall Street still really loved what they heard.

02:16This was DraftKings best Superbowl ever,

02:18which is no surprise

02:19considering what we talked about on Wednesday

02:22with the public just getting absolutely killed

02:25on player props and same game parlays

02:27despite winning on the major markets.

02:29So that's another big sign for the industry

02:31and a good sign for DraftKings

02:32is people continue to bet more and more parlays.

02:34It hasn't stopped yet

02:35and it's really helped them mitigate

02:37some of those headwinds.

02:38So it's a really good outlook so far

02:41to start the year for DraftKings.

02:42And going forward,

02:43I'm sure they'll try to build on momentum

02:45with customer acquisition.

02:46They just bought the online lottery retailer JackPocket,

02:50which so far has produced good returns for them,

02:52though customers are spending at a little lower

02:55than they typically do on iGaming or sports betting

02:59because lottery tickets are cheaper.

03:00So they're gonna try to expand the business that way

03:03and hope for a more favorable NBA season

03:06and MLB season once that gets underway.

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