DraftKings CEO Robbins says iGaming can lead sports betting
DraftKings (NASDAQ: DKNG) CEO Jason Robins expects iGaming in the U.S. to continue to grow and potentially overtake online sports betting in the future, although it currently only operates in six State legal.
The gaming company's CEO and co-founder made the remarks Monday at the third annual Craig Hallam Online Gaming Conference. Sports betting is currently available in 35 states and Washington, DC. is allowed, and iGaming is legal legal in New Jersey, Michigan, Pennsylvania, Connecticut, West Virginia, and Delaware. DraftKings is the largest Internet casino operator by market share, operating in five states.
It makes up a large portion of our sales, and it's only in five states. I mean, it will grow. So to me, iGaming is kind of the unlocked or hidden, I would say the gem of DraftKings,” Robbins told analyst Ryan Sigdahl during the conference.
Analysts and operators are excited about the prospects for internet casinos as the road to legalization at the state level remains long. It's also a more profitable business than sports betting, and bettors are generally more loyal and spend more money than sports betting.
DraftKings invested wisely in iGaming
Robbins admitted that he thinks it will be difficult for DraftKings to capture iGaming's 30% market share (the operator's current market share in the space) and said the company has not even "surfaced" the possibility of an online casino.
DraftKings deftly solidified its position in the arena when it announced the $1.56 billion acquisition of Golden Nugget Online Gaming (GNOG) in August 2021. The acquisition gives DraftKings an immediate boost in the important New Jersey market, where GNOG has long been profitable.
"We're very optimistic about iGaming. I think this is what I've said to a lot of people, at least it's a hidden gem, we're investing heavily in this product. We intend to continue to compete and gain market share," Robbins told Sigdal. "I'm also surprised by how much market share we were able to gain there."
The legal outlook for iGaming in 2024 is currently bleak, but New York could consider the issue, and if passed there, the news could drive up the stock prices of operators like DraftKings. Robbins pointed to Illinois and New York as two states that could drive future growth in the internet casino sector.
DraftKings Coming to Progressive Betting
At last month's Investor Day, DraftKings announced the upcoming launch of Progressive Odds - multi-leg sports betting that gives bettors some compensation even if one or two of their calls go wrong. Robbins said the company is still weeks away from launching the product.
DraftKings boss points out that the operator is not reinventing the wheel with its progressive parlay menu and that the concept has proven reliable in other parts of the world.
"Even if you don't cash out all part of your bet, it's possible to win something. So it's still exciting to chase the big jackpot, but there's also some consolation prize, so I think that's really going to drive customer demand -- in terms of customer demand," he told Sigdal. "It's also good for the casino and like all parlays it should hold up well. I'm very excited about this product."
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Source: www.casino.org
