DraftKings (DKNG) Bank of America Gaming & Lodging Conference summary

NFL season and product innovation

• NFL season is the most critical period, driving new and reactivated customers and setting the tone for the year.

• Significant product launches, including BetVision for low-latency NFL feeds and improved live betting interfaces, aim to enhance customer experience.

• Major backend upgrades have improved page load times, crash rates, and market uptime, positioning the product as industry-leading.

• Real-time metrics and team updates are closely monitored to track customer acquisition and handle during peak periods.

• Execution during NFL season is seen as pivotal for maintaining competitive advantage.

Performance, growth, and customer acquisition

• Q2 performance was impacted by seasonality, product mix, and a focus on volume-driving promotions that were less accretive to hold.

• Over 80% year-over-year increase in customer acquisition at 40-50% lower cost per acquisition, with new customers expected to drive future growth despite short-term negative EBITDA.

• Adjustments in CRM and merchandising have improved parlay mix and hold rates.

• New customer cohorts in mature states are of similar or better quality than previous years, aided by national marketing and industry momentum.

• Customer acquisition and engagement gains are expected to offset tax headwinds, such as the Illinois increase.

Product strategy and competitive positioning

• Focus on live betting and in-game parlays, supported by the Simplebet acquisition, is expected to drive future growth.

• US sports like NFL and baseball are seen as particularly well-suited for live betting due to frequent game pauses.

• Product improvements and marketing are aimed at closing the gap with the market leader, especially in non-NFL sports like NBA.

• Starts of new sports seasons are leveraged to reset customer behavior and drive adoption of new features.