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Flutter anticipates more than doubling its core profit by 2027, driven by the expectation that most Americans will participate in sports betting as more states legalize the activity. The group announced on Wednesday that it now projects its adjusted core profit to reach “over $5 billion” in 2027, up from this year’s estimate of $2.5 billion. The US market is expected to contribute nearly half of this, generating approximately $2.4 billion in adjusted core profit by that year.
Flutter also forecasts that the size of the US sports and online casino market will grow to $63 billion by 2030, a more than 50 percent increase from its previous estimate in 2022, spurred by the rapid expansion of sports betting.
According to Chief Executive Peter Jackson, around 50 percent of Americans currently can place bets on sports. He believes that when the market reaches a more mature state, the penetration rate will be around 80 percent.
The growth of legal sports betting in the US has accelerated since 2018, following a Supreme Court decision to strike down a federal law that had banned such wagering across most of the country. Legal decisions are made at the state level, with 38 states and the District of Columbia now permitting sports betting. Jackson noted that states are seeking additional tax revenues.
Flutter also announced that group revenue is expected to reach $21 billion by 2027, a 50 percent increase compared with this year’s projection of £14 billion. This optimistic forecast led to a 10 percent rise in its shares during afternoon trading in London. The company also unveiled a $5 billion share buyback program.
The group is conducting an investor day in New York following the recent switch of its primary listing from London to the US.
As the owner of FanDuel, in which it acquired a majority stake in 2018, Flutter held the largest market share for online sports betting in the US in the three months to June, with 53 percent, according to Jefferies. This was followed by DraftKings with a 31 percent share, and BetMGM with 7 percent.
Jackson expressed confidence that the growth in market penetration rates will continue, regardless of the outcome of the presidential election.
FanDuel, which achieved its first profit last year after years of significant marketing expenditure, expects to post $740 million in adjusted core profit for this year.
Beyond the US, Flutter remains optimistic. This month, it agreed to acquire Italian gaming business Snaitech from London-listed Playtech in a €2.3 billion deal, and it recently acquired a majority stake in the operator of Brazilian gaming brand Betnacional for approximately $350 million.
Jackson stated that the global market is incredibly fragmented, so mergers and acquisitions will continue to be a part of the company’s strategy moving forward.