DraftKings Inc. shares soared in late trading Thursday, after the sports-gambling company crushed Wall Street’s revenue expectations and executives increased their targets for the full year.
DraftKings DKNG reported a first-quarter loss of $397.1 million, or 87 cents a share, an improvement from a loss of $1.07 a share a year ago. Revenue increased to $769.7 million from $417 million in the same quarter last year. Analysts on average expected a loss of 88 cents a share on sales of $704 million, according to FactSet.
Executives’ optimism extended past the returns from those events, though. DraftKings executives increased their forecast for 2023 revenue to a range of $3.14 billion to $3.24 billion, after previously stating $2.85 billion to $3.05 billion. “We now expect to be approximately break-even on an Adjusted Ebitda basis in the second quarter, supported by fixed costs that are projected to only grow at a single digit rate year-over-year during the quarter,” Robins and Chief Financial Officer Jason Park wrote in a letter to shareholders. We also expect to generate nearly $150 million of Adjusted Ebitda in the fourth quarter.”