Betfred Considers US Exit, Further Retrenchment
Date: 2024-08-19 Author: Alex Crawford Categories: SPORTS BETTING
Betfred faced a number of challenges in July. The company reported a pre-tax loss of £71.7 million ($91.7 million) for the financial year ending October 1, 2023, a significant drop from the profits of the previous year. In addition, the operator was fined for multiple money laundering and social responsibility violations. In the wake of these developments, Betfred has stopped providing sports betting services in Maryland.
The next states where Betfred will shut down its mobile sports betting operations are Ohio and Colorado, with the closure planned for the end of August. However, Betfred USA CEO Kresimir Spajcic recently hinted that the bookmaker may exit the US market entirely in the future.
This means Betfred could end its online operations in states such as Arizona, Iowa, Pennsylvania and Virginia, as well as close retail locations in Nevada, Louisiana and Washington.
Next steps identified by end of 2024
In an interview with EGR North America, Betfred USA CEO Krešimir Spajčić expressed confidence in the company’s ability to build a sustainable business, emphasizing the importance of profitability.
Spajčić also added that while there is interest in increasing the company’s share of the US market through new “breakthrough projects” and renewal of old partnerships, the priority remains ensuring sufficient profitability to continue operations in the country.
He noted that the effort and investment put into the US market is being weighed against other possible regions that could yield greater returns. By the end of the year, he said, the company should have a “better understanding” of its next steps in the US, while not ruling out a “complete exit” from the market in the near future if it fails to achieve the necessary value in the US.
Spajcic also noted that a decision to exit additional states could be made before the end of the year.
The Challenges of Fighting a Duopoly
Over the past six years, numerous US sports betting operators have gone out of business or been acquired, unable to withstand the competition from the DraftKings-FanDuel duopoly, which held 73% of the market in April.
Among them are Tipico, Fubo Sportsbook, PointsBet US, WynnBET, FOX Bet and MaximBET.
It was recently announced that Betway owner Super Group has decided to exit the US market. SuperBook owner Westgate has also announced that it will stop mobile betting in all states except Nevada.
When you consider these challenges, as well as the difficulties foreign companies like Betfred face in adapting to the demands of US players, the prospect of the company's further reduction in the US becomes a real possibility.
