DUBLIN, IRELAND - Flutter Entertainment (NYSE:FLUT)(LSE:FLTR), a global leader in online sports betting and iGaming with a market capitalization of $45.42 billion and impressive revenue growth of nearly 20% over the last twelve months, today disclosed the financial impact of recent US sports betting results on its fourth-quarter performance. According to InvestingPro data, the company has shown strong momentum with a 52% return over the past year. The company, known for its popular FanDuel platform, faced a period of customer-friendly outcomes, particularly in NFL Parlay and Same Game Parlay bets, which proved unfavorable for the company's earnings.
Despite the ongoing strong momentum of US players since the third-quarter earnings report on November 12, the latter part of Q4 saw a streak of favorites winning in NFL games, marking the most customer-friendly season in nearly two decades. This resulted in an adverse gross gaming revenue (GGR) impact of $438 million and estimated reductions in revenue of approximately $390 million and Adjusted EBITDA of about $260 million for the period from November 12 to December 31. InvestingPro analysis shows the company maintains a moderate debt level and is expected to return to profitability this year, with analysts forecasting positive earnings per share of $5.91 for 2024.
As a result, Flutter now estimates its US revenue for 2024 to be roughly $370 million below the previous guidance midpoint, totaling approximately $5.78 billion. The revised US Adjusted EBITDA is expected to be around $205 million lower than the prior guidance midpoint, at approximately $505 million, even after accounting for one-off cost mitigation efforts.
The fourth quarter's sportsbook net revenue margin is expected to be 6.6%, with structural revenue margin at 14.5% and an unfavorable sports result impact of 390 basis points. Promotional spending was reduced by 20 basis points year-over-year as part of the company's efforts to offset the adverse sports outcomes.
In contrast, the Group Ex-US, particularly in the UK and Ireland, experienced favorable sports results, leading to an estimated revenue and Adjusted EBITDA for 2024 that will be approximately 1% and 2% higher than previous guidance.
Flutter Entertainment plans to provide a more detailed update during the scheduled fourth-quarter earnings release on March 4, 2025, along with formal guidance for 2025. This update is based on a press release statement and has not yet been audited or reviewed by an independent registered public accounting firm. Investors are cautioned to consider the preliminary nature of this financial information. For deeper insights into Flutter's financial health and future prospects, InvestingPro subscribers can access 12 additional exclusive ProTips and a comprehensive Pro Research Report, which provides detailed analysis of the company's valuation, growth potential, and market position among 1,400+ top US stocks.
In other recent news, Flutter Entertainment has experienced significant growth in its financial performance. The company reported a substantial 27% year-over-year increase in Q3 revenue, reaching $3.25 billion, largely driven by a 51% surge in U.S. operations revenue. Flutter's adjusted earnings per share also exceeded expectations, coming in at $0.43. These robust financial results led the company to revise its full-year 2024 guidance upwards, now expecting a group revenue of $14.25-$14.55 billion and an adjusted EBITDA between $2.44-$2.62 billion.
In addition to these financial highlights, Flutter Entertainment has initiated a share repurchase program, involving the buyback of up to $350 million worth of its ordinary shares. This program, part of a larger $5 billion initiative, is managed by Goldman Sachs & Co LLC. In response to these developments, analysts from Goldman Sachs, Macquarie, Craig-Hallum, and Needham have maintained a Buy rating for Flutter and adjusted their price targets.
Furthermore, Flutter Entertainment disclosed transactions in company securities by its managerial staff. This announcement is in compliance with the United Kingdom (TADAWUL:4280) Financial Conduct Authority’s Disclosure Guidance and Transparency Rules. The company also updated its total voting rights, a routine disclosure for publicly traded companies. These recent developments reflect Flutter Entertainment's commitment to transparency, strategic growth, and strong operational momentum.
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