Peter Jackson: FanDuel “won” Super Bowl LVI
Flutter boss lauds US sports betting market leader’s performance for NFL showpiece and commits to reduction in New York marketing spend
Flutter Entertainment CEO Peter Jackson has claimed victory on behalf of FanDuel in respect of Super Bowl LVI betting, praising the US market leader’s “tremendous” performance ahead of and during the game on February 13.
FanDuel continues to be a growth engine in Flutter’s portfolio, with US growth offsetting Flutter’s European struggles.
The US division, which includes FanDuel, TVG, PokerStars and FoxBet, reported a 113% year on year (YoY) increase in revenue during 2021, reaching $1.9bn on a pro forma constant currency (CC) basis.
FanDuel contributed 94% of the total US revenue, with player volumes increasing 71% to 1.6 million players over the 12-month period. Speaking as part of Flutter’s 2021 earnings call, Jackson lauded FanDuel’s “watershed” Super Bowl LVI.
“We were delighted with our performance in the Super Bowl this year, we took more than eight million bets, double that of 2021, we had around $187m in handle, which is an increase 80% year on year, so we definitely feel we won the Super Bowl,” he said.
“When you look at the most downloaded apps that weekend, Peacock, who streamed the Super Bowl, were number one, and we [FanDuel] were number two.
“The team did a tremendous job, it was the first year we’ve been an official NFL sponsor, a watershed moment for FanDuel, where we really broke into the mainstream in the US,” Jackson added.
The CEO singled out FanDuel CEO Amy Howe as doing a great job during her first 12 months in the role. Howe replaced prior CEO Matt King in June 2021.
The migration of FanDuel’s product to Flutter’s sports betting in July 2021 and the introduction of the same game parlay product were also referenced by Jackson as a key differentiator in FanDuel’s success.
“We continue to invest heavily in product brand and generosity and believe the efficiency of our spend stands out in the USA Today. Particularly our revenue growth is continuing to exceed our operating cost growth, bringing ongoing improvements on our path to profitability.
“We believe strongly that the long-term winners in this sector are determined by the quality of their product,” Jackson told investors.
One market where FanDuel has shrugged off early competition is New York, with early leader Caesars slowly falling down the handle rankings on a week-by-week basis.
According to latest data released by the New York State Gaming Commission (NYSGC), FanDuel generated a 37% share of handle during Super Bowl LVI week, turning around a loss-making position to an above average hold of 9.4% and a 48.3% share of New York State sports betting GGR.
The rise comes despite a flurry of promotional activity from rival operators eager to gain new customers in the Empire State. Referencing progress in New York, Jackson revealed that FanDuel had gained more than 400,000 new customers from activities there since launch.
Flutter CFO Jonathan Hill said the current NFL season was the “most aggressive” in US sports betting’s short history.
“We’ve seen some people [operators] coming in with very aggressive offers and we have seen our economics through that period hold up,” Hill explained.
“We’ve maintained discipline at times when people were buying handle share and there were some crazy offers out there. What we’ve seen is nonsense from our competitors on their levels of ongoing spend, and pullback, while our returns are looking fantastic,” he added.
FanDuel competitors including DraftKings, Caesars, and Wynn have criticized the marketing war taking place in the state, committing to reducing their respective spend and being more disciplined in their approach to New York operations as the impact of the 51% GGR tax rate hits home.
Referencing FanDuel’s own strategy, Hill continued: “As a result, we will be pulling back from some of our promotional activity because our promotional activity is taxed, even when it’s non-cash, so it’s quite a difficult environment.
“We will be reducing [marketing spend] because economically it’s quite a tricky market,” Hill added.
Jackson echoed many of Hill’s comments, suggesting the tax rate needed to change long term.
“We hope policymakers in New York recognise that while the state benefits from an initial period of heavy investment among operators, such investment is not sustainable beyond the first few weeks aside from different treatment of bonusing or lower tax rates being imposed,” Jackson said.