PointsBet shares slump despite 41% NGR rise to A$85.8m in latest quarterly report
PointsBet shares slumped by more than 10% after the operator reported a 41% uptick in net gaming revenue (NGR) to A$85.8m for Q4 2022.
Sports betting, which climbed 32% year-on-year, provided the overwhelming majority of group NGR at A$78.5m.
The remaining A$7.3m came from iGaming amid a 400% annual increase for the vertical.
Overall handle reached A$1.3bn for Q4 following a 32% rise on the same period of last year, resulting in a net win margin of 6%.
PointsBet is listed on the ASX and Australia ranked as its biggest market during the quarter in NGR terms, despite a strategic operational focus on the US.
Australia NGR came in at A$55.2m, representing a 28% rise year-on-year. All of it was generated via sports betting as iGaming is not permitted in its domestic market.
US revenue growth was strong in Q4, climbing 72% to A$30.4m. The vast majority (78%) of NGR came from sportsbook, while iGaming accounted for A$6.7m following a rise of 355%.
Handle, however, was higher in the US (A$687.9m) during Q4 than in Australia (A$598.6m).
The Q4 net win margin on sports betting was 8.5% in Australia compared to 3% in the US. This was reflected in the Q4 marketing costs for both territories, which came in at A$9.6m and A$27.4m respectively.
Illinois was the strongest performing US state for PointsBet in the quarter for both handle (A$261.7m) and NGR (A$8.5m). The operator ranks third in the Prairie State for GGR market share behind FanDuel and DraftKings.
PointsBet has also reported the first significant financial figures from Ontario’s regulated online gambling market, which went live on 4 April 2022.
The operator generated total Q4 NGR of just A$0.2m from the province after raking in sports betting handle of A$16m. The operator reported negative NGR of A$0.5m on sports betting, compared to a positive A$0.7m for iGaming.
Canada marketing costs came in at A$7.8m for the reporting period. This resulted in overall group sales and marketing costs of A$53m for Q4.
Finally, PointsBet grew its active customer base by 22% in Australia to 239,121 and by 67% in the US to 266,882.
The most significant event in the quarter saw the company secure a A$94.2m strategic investment from SIG Sports, which gave SIG a 12.8% stake in the operator.
Following publication of the Q4 financial results, PointsBet’s share price closed for trading on 29 July 10.9% lower.
However, this could be due to the fact the stock enjoyed a largely unexplained 21% surge a day prior.