Flutter Entertainment PLC (FLUT) Q3 2024 Earnings Call Highlights: Strong Revenue and EBITDA …

• Revenue Growth: 27% increase in Q3.

• Adjusted EBITDA: 74% growth to $450 million.

• Net Loss: $114 million due to non-cash expenses and fair value loss.

• US Revenue Growth: 51% increase, with sportsbook revenue up 62%.

• US Adjusted EBITDA: $58 million, $113 million higher than last year.

• Net Revenue Margin (US): Increased by 130 basis points to 8.2%.

• iGaming Revenue (US): 46% higher.

• UK & Ireland EBITDA Growth: 29% increase.

• Australia Revenue Growth: 12% increase, with 14% adjusted EBITDA growth.

• International Revenue Growth: 17% higher on a constant currency basis.

• Free Cash Flow: $112 million, down from $434 million in the prior year.

• Leverage Ratio: Reduced to 2.4 times from 3.1 times.

• 2024 Guidance (US): Revenue midpoint reduced to $6.15 billion; adjusted EBITDA midpoint to $710 million.

• 2024 Guidance (Group ex-US): Revenue expected at $8.2 billion; adjusted EBITDA at $1.82 billion.

Release Date: November 12, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

• Flutter Entertainment PLC (NYSE:FLUT) reported a strong Q3 performance with revenue growth of 27% and EBITDA growth of 74%, exceeding market expectations.

• The NFL season contributed significantly to growth, with handle up 36% and customer acquisition increasing by 10% year-over-year.

• Product innovations, particularly in the NFL segment, have driven customer engagement and structural revenue margin expansion.

• The company is launching a share repurchase program, intending to buy back up to $350 million of ordinary shares, demonstrating strong capital allocation optionality.

• Flutter Entertainment PLC (NYSE:FLUT) is expanding its market presence with expected launches in Alberta, Canada, and Missouri, USA, in 2025.

• Despite strong performance, Flutter Entertainment PLC (NYSE:FLUT) reported a net loss of $114 million due to non-cash expenses and a loss on the fair value of the Fox option.

• Promotional expenses in the US were higher than expected, impacting the overall financial performance.

• The company faced adverse sports results in Q4, affecting the US revenue guidance, which was slightly reduced.

• There are ongoing regulatory challenges in Brazil, creating uncertainty around the planned January 2025 launch.

• The competitive landscape in the UK and US remains intense, potentially impacting future market share growth and profitability.

Q: On the US, it looks like promotions were up 540 basis points in the quarter, which is above your 400 basis point long-term guide. Is the offsetting benefit with less need for promos that’s led to the relatively strong Q4 guide versus some of your peers? A: (Jeremy Jackson, CEO) Our pricing accuracy is crucial, and that’s what’s driving the differential you’re seeing with our business and others. (Rob Coldrake, CFO) We did give back more to customers due to bookmaker-friendly results in Q3, consistent with our investment strategy. We’re not planning to change that strategy in Q4.

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