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FanDuel Takes $370 Million Hit on Bettor-Friendly NFL Results

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FanDuel Takes $370 Million Hit on Bettor-Friendly NFL Results

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January 7, 2025February 12, 2023
FanDuel Takes 0 Million Hit on Bettor-Friendly NFL Results

This NFL regular season was historically good for betting favorites, and therefore historically bad for sportsbooks.

FanDuel, a unit of Flutter, on Tuesday became the latest operator to shed light on the financial ramifications. The company said in a statement that 2024 U.S. revenue was now estimated to be about $370 million lower due to the results.

More specifically, the company previously said U.S. full-year revenue would be in the $6.05 billion to $6.25 billion range. This week it lowered the midpoint to “approximately $5.78 billion.” The midpoint guidance for adjusted EBITDA in the company’s U.S. business dropped by $205 million to $505 million.

“Following our Q3 earnings report on Nov. 12, continued strong U.S. player momentum has been offset by a period of very unfavorable U.S. sports results across the remainder of November and in December, primarily on NFL parlay and same-game parlay outcomes,” the statement said. “The 2024-25 NFL season to date has been the most customer-friendly since the launch of online sports betting with the highest rate of favorites winning in nearly 20 years.”

The company added that the negative results had “no impact” on the longer-term business expectations shared at its Investor Day on Sept. 1. The stock (NYSE: FLUT) dropped about 2% in late trading. FanDuel also revised a handful of other Q4 guidance metrics, including margins and promotional spend.

FanDuel is almost certainly not alone. The public typically bets more on favorites, and most U.S. sportsbooks are likely to feel the same pinch when those favorites win an abnormal amount. FanDuel’s biggest U.S. competitor, DraftKings, declares its fourth-quarter earnings next month. DraftKings shares fell about 7% in November, when CEO Jason Robins said NFL results in the early part of the season created a $250 million headwind. DraftKings stock (Nasdaq: DKNG) dropped 1% in late trading after Flutter’s update, which may or may not be related.

Flutter owns a number of gaming brands, including Paddy Power, Betfair, TVG, and Sky Betting & Gaming. The U.S. business was about 38% of sales in Q3.