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Stocks of DraftKings closed 28% Friday after the sports betting company reported slower monthly customer growth in the third quarter that fell short of estimates.
However, the company raised its revenue guidance for the year after revenue for the quarter came in above Wall Street expectations. The loss for the period was not as steep as expected.
For the quarter ended September 30, DraftKings said the number of unique paying customers per month increased to 1.6 million, up about 22% from 1.3 million a year ago. That was less than the 2 million analysts had forecast, according to StreetAccount, and slower than in the previous two quarters.
DraftKings said the expansion of its online Sportsbook product, launched in September, will help drive customer acquisition, engagement and retention.
After launching its online Sportsbook in Kansas in September, DraftKings said it is live with mobile sports betting in 18 states, representing about 37% of the US population. It said it plans to launch in Maryland, Puerto Rico, Ohio and Massachusetts pending licensure and regulatory approvals.
“Our team continued to drive revenue growth through highly effective customer engagement and compelling product and technology improvements, while continuing to focus on our path to profitability,” said Jason Robins, co-founder and CEO of DraftKings.
For the quarter ended September 30, the company reported a net loss of approximately $450 million, or $1 per share, compared to a loss of $545 million for the same period last year. Analysts expected a loss of $1.04 per share.
Revenue for the period rose to $502 million, which was ahead of the $437 million Wall Street had expected.
The company raised its revenue forecast for 2022 to a range of $2.16 billion to $2.19 billion, up from its previous estimate of between $2.08 billion and $2.18 billion.