Proactive Investors - DraftKings Inc (NASDAQ:DKNG) shares moved higher in premarket trade after the fantasy sports betting business upped its full-year revenue guidance on the back of a strong first quarter.
The company raised its fiscal 2024 revenue guidance for $4.9 billion from $4.78 billion at the midpoint and its adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) projection to $500 million from $460 million.
CFO Alan Ellingson attributed the improved guidance to the company’s “excellent” Q1 results and an improved outlook on customer acquisition and engagement for the rest of the year.
For the three months ended March 31, 2024, DraftKings posted a 53% year-over-year jump in revenue to $1.17 billion, ahead of Street estimates of $1.12 billion.
Revenue growth was attributed to improved customer engagement, new customer wins, the expansion of its Sportsbook product offering into new jurisdictions, a higher structural sportsbook hold percentage, and improved promotional reinvestment for Sportsbook and iGaming.
The company posted adjusted earnings per share of $0.03, ahead of estimates of a loss per share of $0.11.
“DraftKings’ performance in the first quarter of 2024 was outstanding, reflecting healthy revenue growth and a scaled fixed cost structure that positions us to drive rapidly improving adjusted EBITDA,” CEO Jason Robins commented.
“We successfully launched our online sportsbook in Vermont and North Carolina with highly efficient customer acquisition. Looking ahead, we remain committed to maximizing shareholder value through continued innovation, operational excellence and disciplined capital allocation.”
DraftKings shares added 4% at $44.75 shortly before Friday’s opening bell.