DraftKings (DKNG) - Get DraftKings Inc Class A Report gained on Friday after it reported a narrower-than-expected second-quarter loss and raised its guidance for the remainder of the year amid a rebound in online sports betting and interest in NFTs and other media that continues to draw users to its online platform.
DraftKings reported a loss of $305.5 million, or 26 cents an adjusted share. Analysts surveyed by FactSet had forecast a second-quarter adjusted loss of 54 cents a share.
Revenue totaled $298 million, up 320% from a year ago and handily above analysts' estimates of $245.5 million. Monthly unique payers (MUPs) increased 281% to 1.1 million.
"DraftKings had a particularly strong second quarter of 2021, maintaining our impressive financial performance while also advancing into new areas, such as media and NFTs," said DraftKings co-founder and CEO Jason Robins. "We believe these expansion opportunities will enable us to further grow our customer base and generate additional revenues through cross-selling to our existing players."
Looking ahead, DraftKings raised its fiscal 2021 revenue guidance to a range of $1.21 billion to $1.29 billion from a range of $1.05 billion to $1.15 billion, "... which equates to YoY growth of 88% to 100% and a 14% increase compared to the midpoint of our previous guidance," the company said.
DraftKings was one of the early "SPACs" to hit the market. Last April it combined with publicly traded special-purpose acquisition company Diamond Eagle Acquisitions and SBTech, with its shares rising 10% to $19.21 in its first day of trading.
However, a lack of live sporting events globally due to the coronavirus pandemic made betting on sporting events nearly impossible, which ate into the company’s earlier profit picture.
The stock took a big hit in June after analysts at Hindenburg Research, a noted short-seller, said the company's merger with Bulgaria-based SBTech had opened it up to exposure linked to black-market gaming and money laundering.
DraftKings responded to the allegations, telling TheStreet that the report was "written by someone with an incentive to drive down the share price," adding that "our business combination with SBTech was completed in 2020" - a response TheStreet's Jim Cramer noted was "not a reason to sell."
At last check, shares of DraftKings were up 2.79% at $51.89. The stock has gained 12.53% year to date.