DraftKings anticipates achieving its first full year of positive adjusted EBITDA in 2024, with earnings potentially reaching $510 million, up from the previously projected $450 million. Revenue for 2024 is now estimated to fall between $4.65 billion and $4.90 billion, an increase from the previous range of $4.50 billion to $4.80 billion. These forecasts were disclosed in the preliminary results for 2023 and Q4 results.
During the year ending on December 31, 2023, DraftKings experienced a 63% increase in revenue, reaching $3.7 billion. The loss from operations was $789.2 million, a significant improvement from the $1.5 billion loss in 2022, and the negative adjusted EBITDA was $151.0 million, a notable reduction from the $721.8 million reported the previous year. Cost of revenue grew by 57% to $2.3 billion, while sales and marketing expenses remained flat, and general and administrative expenditure decreased by 20%.
CEO Jason Park stated, “In 2023, we accomplished our goals of achieving remarkable revenue growth and driving significant operating efficiencies. Based on our strong performance in the first six weeks of 2024 and our successful customer acquisition efforts in the fourth quarter, we have revised our revenue guidance for fiscal year 2024 to $4.775 billion and adjusted EBITDA guidance to $460 million. This marks a significant milestone towards our objectives outlined at the November 2023 investor day.”
In Q4 2023, DraftKings reported revenue of $1.2 billion, a 44% increase compared to the same period in 2022. Loss from operations decreased to $43.8 million from $232.2 million in Q4 2022, and adjusted EBITDA improved from a negative $49.9 million to positive $151.0 million.
The positive performance in Q4 was attributed to strong customer engagement, efficient customer acquisition, expansion into new markets, and product innovation. Despite facing challenges from unfavorable sporting outcomes, DraftKings remains focused on executing its core strategies, prioritizing customer satisfaction, and enhancing its product offerings to maintain a competitive edge in the market.
As part of its growth strategy, DraftKings announced the acquisition of lottery app Jackpocket for $750 million, in a move expected to generate additional revenue of up to $340 million annually.
