PointsBet Reports Increased Revenue Despite Expanded Losses

PointsBets chief executive officer asserts that the company’s approach in the United States is yielding positive results despite expanded financial setbacks in the initial six months of the year.

PointsBet recorded earnings of A$178.1 million (£989,877/€1.1 million) for the half-year concluding on December 31, 2022, showing a 28% year-over-year increase. However, losses expanded to A$178.2 million.

The net loss rose by 21.7% year-over-year. During the six-month period, PointsBets expenditures on its American operations constituted the majority of its costs, and these operations also significantly contributed to its revenue, accounting for A$75 million of the total. This represents an 86.1% increase from the initial six months of 2022.

PointsBet introduced its sports betting offering in Kansas and Louisiana in September 2022, and in Maryland in November when the market officially opened.

By the conclusion of the half-year, PointsBet offered mobile betting in 14 states, retail betting in 3 states, and online casinos in 4 states.

In January, PointsBet inaugurated a new retail sportsbook in Illinois, its fourth retail location.

Sam Swanell, Managing Director and Group CEO of PointsBet, stated that the company’s performance in the United States was robust.

“These outcomes demonstrate that our North American approach is effective – earnings are expanding, expenses are decreasing,” he remarked.

In the USA, the global leader in online gambling expansion, we are recognized as the seventh largest online gambling operator, standing out among over 60 authorized online operators.

He also commended the operator’s performance in Australia, despite a slight dip in income from A$97.6 million in the initial six months of 2022 to A$95.3 million.

Last month, PointsBet initiated discussions about selling its Australian business to NTD Limited, a joint venture headed by News Corp. NTD Limited operates the Betr brand in Australia.

Betr was established by internet personality Jake Paul and Simplebet co-founder Joe Levy and launched in August 2022.

“The Australian business continues to make progress,” he continued. “In Australia, total turnover was A$1.55 billion, an increase of 14% year-over-year, with total net winnings of A$105.3 million, a decrease of 2% year-over-year.”

By region
PointsBet generated A$6.7 million in revenue from its Canadian operations, with no year-over-year data available as the Canadian sports betting market opened on April 4, 2022. Technology contributed the remaining A$1.1 million in revenue, a decrease of 9.0% year-over-year.

Total wagering for the period was A$3.2 billion, an increase of 39.8% year-over-year. Of this, the United States contributed the most, at A$1.57 billion, an increase of 66.0% year-over-year.

Wagering in Australia was A$1.55 billion, an increase of 14.1%. Wagering in Canada was A$101.3 million.

Total net winnings from sports betting were A$158.2 million, an increase of 13.6%.

Concerning geographical distribution, the net income from sports gambling in Australia stayed fairly steady, experiencing a slight decrease of 2.4%.

On the other hand, in the United States, the net income from sports gambling witnessed a more substantial shift, rising by 62.0%.

PointsBet Half-Year Financial Summary

The cost of goods sold totaled A$108.2 million, leading to a net profit of A$69.8 million. This net profit was 27.6% greater than the first half of the prior year.

Additional income reached A$3.7 million, encompassing A$3.6 million in net foreign exchange gains and A$0.115 million in research and development income, somewhat offsetting this growth.

Moving on to expenditures, marketing expenses were the most significant at A$131.3 million. This was followed by employee benefits expenses of A$74.9 million and depreciation and amortization expenses of A$22.5 million.

The remaining A$26.8 million originated from various other expenses, including consulting fees and administrative expenses.

Total expenses amounted to A$255.6 million over the six-month period, representing an increase of A$57.3 million compared to the previous year.

After A$4.6 million in financial income and A$2.1 million in financial expenses, the pre-tax loss was A$179.6 million.

Taking into account a tax benefit of A$1.4 million, the total loss for the period reached A$178.1 million.

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