Key points:
- PointsBet’s Q1 FY2025 net win rose by 12% year-on-year, reaching AU$65.3m
- Australia saw a 7% increase in net win, while Canada reported a 62% growth in total net win
- Cost management remained a focus, with significant cuts in marketing and efficiency improvements
PointsBet has announced its financial results for the first quarter of fiscal year 2025, covering the period ending 30 September 2024.
The company reported a 12% year-on-year increase in total net win, amounting to AU$65.3m (US$42.8m), attributed largely to revenue growth in its primary markets of Australia and Canada.
Gross profit increased by 15%, outpacing net win growth as PointsBet maintained cost efficiencies across its operations.
Performance in Australia and Canada
In Australia, PointsBet achieved a net win of AU$56.6m, marking a 7% increase year-on-year. The gross win margin improved slightly to 13.2%, driven by a shift in consumer preference towards higher-margin products.
This improvement, paired with reduced “generosity” spend — incentives given to non-genuine clients — helped strengthen PointsBet’s profitability.
The company’s cash active clients in Australia also rose by 5%, reflecting sustained engagement in this core market.
In Canada, PointsBet reported a total net win of AU$8.7m, representing a significant 62% increase. Sports betting net win surged by 77%, supported by higher turnover and increased efficiency in promotional spending.
In-play betting, which accounted for 76% of Canada’s total sports betting turnover, played a key role in this growth, indicating a strong demand for live betting options among Canadian clients.
Improved operational efficiency and cost management
PointsBet’s focus on cost management continued to yield positive results. In Q1 FY2025, the company recorded a total cash outflow from operating activities of AU$2.7m, a reduction from previous quarters as PointsBet concentrated on cost-effective growth.
Marketing expenses reached AU$16.5m, reflecting the start of peak acquisition periods in both Australia and Canada. However, the company’s strategic use of promotional spending, particularly in targeting genuine clients, contributed to an improved net win margin of 9.7% for sports betting.
Additionally, PointsBet invested AU$5.6m in capitalised software development, supporting the ongoing enhancement of its technology platform. Despite this investment, PointsBet expects to achieve cash flow break-even by the end of FY2025, a target reaffirmed by management.
Growth in multi-bet and in-play betting products
PointsBet has also experienced notable growth in multi-bet products, especially in Australia. The company reported that turnover for multi and same-game multi (SGM) products grew by 24%, with a 44% increase in the total bet count.
The AFL and NRL Grand Finals in Australia saw particularly strong engagement, with SGM actives representing over 80% of all active clients during these events. This trend continued into the NFL and NBA seasons.
In Canada, in-play betting constituted 76% of total turnover, up 68%. This segment’s growth reflects a broader market trend favouring real-time betting experiences, which PointsBet has capitalised on through its proprietary in-play betting technology.
Cash position and future guidance
At the end of September, PointsBet reported cash and cash equivalents of AU$33.6m, which included AU$16.9m held in player cash accounts. The company’s cash outflow from investing activities was AU$5.6m, primarily due to software development expenditures.
PointsBet also maintained a cautious approach to financing, with minimal changes in credit arrangements and no new borrowing in the quarter.
Good to know: Looking ahead, PointsBet has issued guidance for FY2025, expecting total revenue between AU$280m and AU$290m.
The company aims to maintain gross profit margins above 50%, absorbing regulatory changes, such as the increase in Victoria’s Point of Consumption Tax, without impacting overall profitability.
PointsBet also intends to continue its strategic investment in marketing and product development to strengthen its market position in both Australia and Canada.
Past developments and strategic shifts
Earlier in 2024, PointsBet completed the sale of its US operations to Fanatics Betting and Gaming for AU$225m. This divestment allowed PointsBet to concentrate resources on its core markets, particularly Australia and Canada, where it sees the greatest potential for growth.
Additionally, in FY2024, PointsBet implemented substantial cost-saving measures, reducing marketing expenses by 21% and achieving a 17% increase in net revenue.
