Flutter Entertainment (FLUT, PDYPY), the parent company of sports gambling platform FanDuel, began trading on the New York Stock Exchange on Monday. Flutter Entertainment CEO Peter Jackson joins Yahoo Finance's Josh Schafer on the floor of the New York Stock Exchange to discuss Flutter's listing and its path to growing market share in the U.S. sports betting landscape.
Jackson commented on the timeline for national sports betting legalization: “I don't expect Utah to pass the bill because obviously there's going to be some holdouts, Florida. If you look at the three big states between the states, Texas and California, we expect at least one or two of those states to start operating soon.There are a lot of firsts. We already represent 45% of the population here in the United States.”
Jackson also talks about parlay betting, the NFL ahead of this year's Super Bowl, and competition in the space with other platforms like DraftKings (DKNG).
For more expert insights and the latest market trends, click here to watch the full episode of Yahoo Finance Live.
Editor's note: This article was written by luke carberry morgan.
video transcript
Josh Shafer: And we're here on the floor of the New York Stock Exchange. And standing with me is Peter Jackson, CEO of Flutter Entertainment. Flutter received a dual listing on the New York Stock Exchange today. They were planning to make a new listing on the stock exchange later this year.
Flutter is, of course, the parent company of US Sportsbook FanDuel, the largest US Sportsbook in the United States. Peter, this is clearly a big moment for you. Many people expected this. Well, why now? Why is it coming to market now?
Peter Jackson: We are really excited to list our business here on the New York Stock Exchange. It is the world's largest capital market. We are the world's largest sports betting and gaming business. And we thought it was the right thing to do. It took some time to complete all the work to get the secondary listing approved, but we're happy and excited to be here.
Josh Shafer: And we also mentioned the overall size. One of the big talking points in the industry is the growth that sports betting has seen since it was legalized in the United States, and the potential for further growth. Your prediction that the total addressable market will be $40 billion by 2030. How can we get there?
Peter Jackson: Well, we're a fast-growing business. If you look at the revenue growth over the last year, it's up 25%. And not only does Flutter benefit from owning his FanDuel, he likewise benefits all international businesses that are growing between 5% and 10%.
The $40 billion figure you referenced is simply looking at the number of states it is expected to license, looking at the penetration rate it expects to reach compared to Australia and other markets, and looking at the average bet size. Thing. Americans are doing it. And from there we get to $40 billion. I think in America everything will turn out to be bigger than expected, so we will become more conservative.
Josh Shafer: How big a concern is legalization? So far, we know it hasn't always been a straight path. I think California in 2022 will not approve legal sports gambling like many other large states. Are you concerned that perhaps the market won't reach all 50 states and be as big as it could be?
Peter Jackson: Obviously, there are going to be some states that are going to be — which states are going to be holdouts, right? Therefore, we do not expect Utah to pass the bill. Looking at the three large states between Florida, Texas and California, we anticipate that at least one or two of them will allow our company to begin operations.
There are many things we should pursue. FanDuel Sportsbook is now available to his 45% of the population here in the United States. It is expected that more states will implement it in the future.
Josh Shafer: And Peter, I'm curious when you think about competition in this space. One of the big discussions heading into this fall football season was that ESPN would be getting into betting for the first time, right? And there were fanatics who took part in gambling. So after you worked hard to dominate the market share on DraftKings, there were some new players. How is that impacting your business today and perhaps also the marketing spend you have to spend?
Peter Jackson: Every year, at the beginning of football season, we always talk about the fact that it's going to be competitive. And that's how it always ends up. Like every year, someone came along to create a buzz. What we're really focused on is making sure we deliver the best products to our customers. And that's what sets us apart. The game parlays that people love and embrace are the same in American football and basketball, something we pioneered and are far ahead of our competitors. And that's what's really important to us in this market.
Josh Shafer: A same-game parlay is when you take part in one game and bet on multiple outcomes, right? You bet on someone to score a touchdown, and possibly your team to win, and combine those bets into one. Combine.
Peter Jackson: absolutely.
Josh Shafer: How has that helped you as a business? Because I think that might be a higher margin part of the business.
Peter Jackson: Well, it's pretty complicated to do, right? And kudos to the Australian team for working out the math involved in these results. Because they are all related to each other. But from a customer perspective, it's very exciting.
When you're watching a game and you think someone is going to reach a rushing yardage goal, someone is going to score a touchdown, or your team is going to win, you can put it all together. You can stay focused on the game until the end. That's why we think our customers are so interested.
And in the fourth quarter, the sport turned against us. Because the sports results were against us, we gave our client his $343 million. So these parlays sometimes work for us and sometimes for our customers.
Josh Shafer: With so much money at stake, how do you manage it as a business?
Peter Jackson: We are a diverse group. And that's one thing that really helps us. We are the world's largest sports betting and gaming business. It's number one here in America. We are number one in the UK and number one in Australia. It also has very strong positions in many other markets around the world. And diversification in geography and sports really helps us.
Josh Shafer: And Peter, today is the day after the NFC and AFC Championship games. So, I would like to ask you about the Super Bowl, which is coming up in two weeks. We have the Chiefs, we have the 49ers. I'm curious as a business, is this still like the biggest weekend for the U.S. sports betting industry, or is that starting to change as the market matures?
Peter Jackson: That's interesting. If you look at the amount we bet on the two games he bet on yesterday, just the 49ers game, that was the biggest game since last year's Super Bowl. So I'm sure the Super Bowl will break records in the coming weeks.
It's always interesting to see how the weight of money affects different teams. Looking at the weighted awards yesterday, the 49ers weren't as strongly favored. So it was interesting to see them succeed. But look, we're here to support our customers and strive to give them a great experience at the Super Bowl.
Josh Shafer: Does that mean you don't have a choice?
Peter Jackson: I'm not going to choose for you. I don't want to be caught doing that. But you know, we're going to be so excited. There are 600 markets for you to choose from. But the big question for the Super Bowl is whether Gronk will be available or will miss out. That's something we don't know this year. You have to watch the Super Bowl to find out.
Josh Shafer: We look at FanDuel AD during the Super Bowl against Gronk. Peter Jackson, CEO of Flutter Entertainment.
