Shares of online sports gambling company DraftKings (DKNG) - Get Report surged Wednesday after the company announced that Michael Jordan has taken an equity stake in the company in exchange for “providing guidance and strategic advice to the board of directors on key business initiatives,”
CEO Jason Robins said that “The strategic counsel and business acumen Michael brings to our board is invaluable.”
Online gaming has grown in popularity in recent years with 18 states legalizing the practice since 2018.
Jordan serves as the chairman and majority owner of the NBA's Charlotte Hornets. The NBA was one of the first major U.S. sports league’s to fully online sports betting and North Carolina recently passed pro-online gaming legislation.
It was a rough quarter for DraftKings as the sports shutdown resulted in a loss of 55 cents per share, up from its loss of 15 cents per share a year ago and short of analyst expectations of a loss of 20 cents per share.
Revenue, on a pro forma basis, fell to $75 million from $83 million a year ago. However, the company’s balance sheet is in a strong position with over $1.2 billion in cash on hand and no debt.
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