Q1 2024 Draftkings Inc Earnings Call Transcript
Key Points
- DraftKings Inc (DKNG) reported a 53% year-over-year revenue growth in the first quarter, with an updated revenue guidance midpoint implying 34% growth for fiscal year 2024.
- Successful Sportsbook launches in Vermont and North Carolina, with efficient customer acquisition and expected positive contribution to adjusted EBITDA in the second half of 2024.
- Continued focus on product innovation and customer centricity, leading to excellent customer retention and participation across sports and games.
- Operational efficiency improvements across the organization, with an expected adjusted EBITDA flow-through percentage of 53% for fiscal year 2024.
- Exploration of capital allocation options due to strong free cash flow trajectory, with year-end 2024 cash and cash equivalents projected at approximately $1.6 billion.
- Customer-friendly outcomes in late March and April posed a headwind of $60 million to fiscal year 2024 revenue and $42 million to adjusted EBITDA guidance.
- The ongoing need to balance capital allocation with potential M&A activities, considering the integration and resource requirements.
- Challenges in maintaining competitive pricing and promotional efficiency in a rapidly evolving market.
- Dependence on the successful integration of Jackpocket and other acquisitions to achieve projected growth and market expansion.
- Potential risks associated with legislative changes and tax rate adjustments in various states that could impact profitability and market dynamics.
Good day, and thank you for standing by. Welcome to DraftKings First Quarter 2024 Earnings Call.(Operator Instructions) Please be advised today's conference is being recorded.
I would now like to hand the conference over to your speaker today, Stanton Dodge, Chief Legal Officer. Please go ahead.
Good morning, everyone, and thank you for joining us today. Certain statements we make during this call may constitute forward-looking statements that are subject to risks, uncertainties and other factors as discussed further in our SEC filings that could cause our actual results to differ materially from our historical results or from our forecast. We assume no responsibility to update forward-looking statements other than as required by law.
During this call, management will also discuss certain non-GAAP financial measures that we believe may be useful in evaluating DraftKings' operating performance. These measures should not be considered in isolation or as a
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