DraftKings (DKNG) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue grew 26% year-over-year to $1.104 billion, driven by strong customer engagement, new jurisdictions, and the Jackpocket acquisition.

• Monthly Unique Payers (MUPs) rose 50% to 3.1 million, with customer acquisition cost declining over 40% year-over-year.

• Net income for Q2 2024 was $63.8 million, a significant improvement from a net loss of $77.3 million in Q2 2023.

• Board authorized a $1 billion share repurchase program, reflecting confidence in future free cash flow and long-term outlook.

• Announced a gaming tax surcharge for high-tax states, to be implemented in four states with tax rates above 20% starting January 1, 2025.

Financial highlights

• Q2 2024 revenue reached $1.104 billion, up from $875 million in Q2 2023.

• Adjusted EBITDA for Q2 2024 was $128 million, up from $73 million in Q2 2023.

• Adjusted EPS for Q2 2024 was $0.22, up from $0.14 in Q2 2023.

• Gross margin for Q2 2024 was 40%, with Adjusted Gross Margin at 43%.

• Cash and cash equivalents as of June 30, 2024, were $815.9 million.

Outlook and guidance

• FY2024 revenue guidance raised to $5.05–$5.25 billion, representing 38%–43% year-over-year growth.

• FY2024 Adjusted EBITDA guidance revised to $340–$420 million, reflecting tax changes and Jackpocket inclusion.

• FY2025 Adjusted EBITDA expected to be $900 million–$1 billion, with potential upside from the gaming tax surcharge.

• Guidance includes impact of Jackpocket acquisition and all current jurisdictions.

• Adjusted Gross Margin expected to increase modestly in FY2024.