DraftKings Anticipates Q2 Launch into Ontario Sports Betting Market

DraftKings Anticipates Q2 Launch into Ontario Sports Betting Market
By Mark Keast

DraftKings Chief Financial Officer Jason Park said on an earnings call Friday that the company could launch into the Ontario sports betting market in May. 

During the call, DraftKings Sportsbook also identified other jurisdictions it could launch into this year — Ohio, Maryland and Puerto Rico.

But the company was most definitive about Ontario, where sports betting and iGaming launched on April 4. Since then, the big question has been when DraftKings and BetRegal will go live in the province.

DraftKings CEO Jason Robins said during the call: “We expect to go live in Ontario in the near future pending licensing and regulatory approval. Ontario represents about 40% of Canada’s population, and Ontario would be the fifth largest U.S. state by population if it were in the U.S.”

“However, due to the presence of grey market operators, many of which have been present in Ontario for several years, we do not believe the timing of our launch will have any impact on the share we are able to achieve in that province.”

The company on Friday reported a 34% increase in total revenue to $417 million. That exceeded expectations by $7 million. The Boston-based company’s adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) also did better than analysts’ estimates, up more than 12%. But its losses were about $467 million in Q1.

The company completed its acquisition of Golden Nugget Online Gaming this week.

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'Assuming Ontario Launches in May'

“For the full year we expect with the acquisition of GNOG combined with our expected launch in Ontario in the second quarter would contribute $130-150m in revenue and negative $50-70 million in adjusted EDITDA,” Park said on the call. “In Q2 we expect that the GNOG business combined with our launch in Ontario would contribute between $20-25 million in revenue and negative $35-45 million in adjusted EBITDA assuming Ontario launches in May.” 

There has been a lot of chatter about when DraftKings would jump in here, and the impact that would have on all the other players currently operating — companies like FanDuel Sportsbook Ontario, BetMGM, bet365, PointsBet and Caesars. There are currently 21 licensed websites belonging to 13 operators live in the province. 

DraftKings, live with online sports betting in 17 U.S. states, just marked its two-year anniversary as a public company. It has been running “coming soon” television ads in the Ontario market.

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Mark Keast

Mark Keast has recently covered the sports betting industry in Canada for The Parleh, and is a long-time sportswriter and editor, most notably with the Toronto Sun.