Q2: Flutter net income down 88% but revenue up 16% to $4.19bn

Key points:

– Flutter unsurprisingly continues to grow in revenue, up 16%, driven by FanDuel growth (particularly in iGaming)

– However, net income fell 88% year-on-year for Q2 and earnings per share fell 59%

– CEO highlights 100% ownership of FanDuel, becoming “largest operator in Italy” and establishing a “scale position” in Brazil

– Share price remains constant upon release, at $306.07

Flutter Entertainment has announced revenue of $4.19bn for Q2, up 16% year-on-year, although net income was down 88% to $37m.

Adjusted EBITDA did see 25% growth to $919m, with a margin of 21.9%. Conversely, however, earnings per share were down 59% to $0.59.

FanDuel, specifically, saw $1.8bn in total revenue for Q2, with sportsbook revenue growing 11% year-on-year to $1.2bn and iGaming revenue soaring 42% to $507m (despite there only being a handful of US states live for online casino).

Internationally, UK and Ireland Q2 revenue was up just 1% to $936m – and down 5% on a constant currency basis.

There was a 68% annual rise in Southern Europe and Africa revenue to $657m, however, while Brazil shot up 144% to $44m.

Asia Pacific revenue rose 4% to $402m, while Central and Eastern Eruopean revenue was up 8% to $138m.

CEO reaction

Peter Jackson, Flutter CEO, said: “I am pleased with the excellent underlying performance we have delivered in the second quarter alongside the good progress made on a number of key strategic initiatives. Revenue grew by 16% year-on-year, as we continue to build scale positions in the most attractive markets through strong organic growth and value creating M&A.

“Since Q1, Flutter gained additional US index inclusion and accelerated ownership of FanDuel to 100%. We also became the largest operator in Italy with the addition of Snai; established a scale position in Brazil through NSX; and successfully executed two transformative customer migrations. Such varied achievements in one quarter are a great reflection of our teams’ focus and ability to execute effectively, leaving us well positioned for the second half of the year.”

In his letter to shareholders, Jackson also wrote of the burgeoning (but fraught with regulatory question marks) predictions/event contracts space: “The event contracts landscape continues to develop at pace. We have two decades’ experience of operating the world’s largest betting exchange, the Betfair Exchange, which shares similar characteristics with event contracts, and this will help inform our views.

“We are closely monitoring regulatory developments, and are assessing the opportunities and potential participation strategies this may present for FanDuel.”

Market share wise, Jackson wrote to shareholders that, in the US, FanDuel “maintained our number one sportsbook position while extending our number one position in iGaming, closing the quarter with sportsbook GGR market share of 41%, a 44% NGR market share and a record 27% iGaming GGR market share.”

Flutter’s forecasts

In the release of its Q1 results, Flutter projected full-year guidance of $16.63bn-$17.52bn in group revenue, an upgrade of around $1bn.

Group adjusted EBITDA guidance was also increased, but only slightly to $2.96bn-$3.4bn.

Flutter’s US business, led by FanDuel (let’s not forget Flutter is now primarily listed in the US) was projected to account for almost half of this revenue and around a third of adjusted EBITDA.

That said, Flutter actually reduced its guidance from $7.47bn-$7.97bn in US revenue to $7.19bn-$7.69bn, with guidance for adjusted EBITDA also down to $1.1bn-$1.34bn.

Flutter has since completed a deal to purchase Boyd Gaming’s 5% stake in FanDuel, increasing its ownership stake to the full 100%.

Q2 guidance

Both revenue and adjusted EBITDA guidance in the US have now increased (to $7.58bn and $1.26bn, respectively). International revenue and adjusted EBITDA have remained constant.

* Selected B2C operators chosen; Entain (most directly comparable to Flutter) and Bally’s due to report next week

As our competitor analysis shows, MGM has generated the highest revenue totals – $4.4bn for Q2 and $8.7bn for H1.

In fact, MGM is the only operator to outperform Flutter in this metric, although it has relied on its huge land-based operations across the US and Asia to achieve this feat. Online, Flutter’s revenue dwarfs that of MGM.

Good to know: Penn Entertainment released its Q2 report earlier today, as well as Century Casinos

Only Las Vegas Sands and Caesars are within realistic reach of Flutter’s revenue tallies away from MGM, again relying predominantly on land-based performance.

FDJ United and Super Group provide interesting comparisons, given they both own prominent B2C online brands but pale in comparison numbers wise, due to the sheer size of the wider Flutter group.

You can also visit Gaming America for analysis of FanDuel’s Q2 results. Read more on Flutter CEO Jackson, too, in his CEO Special interview with Gambling Insider from December 2024.