Entain's Strong Q3 Performance Showcases Revenue Growth

Entain has reported impressive financial results for the third quarter, with a particular focus on revenue growth across its diverse portfolio. The company's online business saw a substantial increase, with a 9% rise in revenue compared to the same period last year. This growth can be attributed to a significant boost in online gaming revenue, which surged by 14%.

In the online sports betting sector, there was also a revenue increase, albeit a more modest 1% rise, accompanied by a slight decline in wagers. However, the sports margin improved by 0.5 percentage points.

Shifting the focus to their retail operations, Entain saw a 4% increase in revenue in regions including the UK, Ireland, Italy, Croatia, Poland, and New Zealand.

In the United States, Entain's joint venture with MGM Resorts, BetMGM, continued to shine in Q3. Net gaming revenue for BetMGM was 8% higher, reaching approximately $458 million during the quarter. BetMGM's market share in various regions stood out, holding an 18% share in markets excluding New York. In particular, BetMGM claimed a substantial 26% share of the U.S. market for igaming in Q3. The NFL season's successful start in early September, combined with investments in enhancing the customer experience on BetMGM, contributed to this growth.

With such remarkable growth in the U.S. market, Entain anticipates BetMGM's full-year revenue could range between $1.80 billion and $2.00 billion. The segment is also expected to be EBITDA-positive in the second half of the year.

Entain's CEO, Jette Nygaard-Andersen, expressed confidence in the company's transformation and strong foundations for future growth.

Entain is building for the future, with a strategic focus on optimizing its market portfolio for organic growth. This involves prioritizing high-growth and high-return markets, including the U.S., Brazil, Central and Eastern Europe (strengthened by the recent STS acquisition), and New Zealand.

The company also plans to achieve profitable growth in core markets like the UK, Australia, Italy, Germany, and the Baltics, while exiting smaller, non-core operations.

Additionally, Entain aims to return to organic growth in line with its markets and is committed to investing in increasing its U.S. market share to between 20% and 25%.

Looking ahead, Entain will be implementing Project Romer to reach an online EBITDA margin of 28% by 2026 and 30% by 2028. To achieve these targets, the company plans to streamline its operations and drive cost efficiencies. They also aim to make cross cost savings of £100 million by 2025.

Entain is dedicated to improving its governance, recently appointing new non-executive directors to further enhance its responsible gambling initiatives and long-term prospects. The company is determined to focus its portfolio on organic growth, boost its U.S. market share, improve operational leverage, and increase EBITDA margins.