DraftKings shares are up 20% on Friday: this is why

Shares of DraftKings Inc (NASDAQ: DKNG) are close to 20% up on Friday after the sports betting company reported a narrower-than-expected loss for its fiscal second quarter and raised its guidance for the full-year.

Notable figures in DraftKings Q2 earnings report

  • Lost $217.1 million versus the year-ago $305.5 million
  • Per-share loss of 50 cents was narrower than last year’s 76 cents
  • Revenue went up 56.6% year-over-year to $466.2 million
  • Consensus was 75 cents of per-share loss on $438.6 million revenue
  • Cost of revenue shot up 67.2% and cost of sales and marketing 15.7%
  • Monthly unique payers (MUPs) climbed 30% to 1.50 million
  • Average revenue per MUP (ARPMUP) came in at $103

Despite the rally, DraftKings shares are still down roughly 25% versus the start of 2022. In the earnings press release, CEO Jason Robins said:

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Due to our ongoing investments in core online gaming tech, we’re in strong position from a competitive perspective as we approach the NFL season.

DraftKings shares up on raised future guidance

The Boston-headquartered sports betting company now forecasts its revenue to fall in the range of $2.08 billion to $2.18 billion this year. Robins added:

Customer engagement remains strong, and we see no perceivable impact from broader macro pressures. We remain well capitalised, ready to enter new markets, and confident in our ability to win with customers.

DraftKings is convinced it’ll contract its adjusted loss before interest, taxes, depreciation, and amortisation to $765 million – $835 million. Wall Street currently rates DraftKings shares at “overweight”.

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Source: https://invezz.com/news/2022/08/05/draftkings-shares-are-up-20-on-friday-this-is-why/