Entain

BetMGM: FY25 revenue guide underwhelms

  • Sectors : Gaming
  • Companies : Entain

Ratings and price correct at time of issue.

  • Entain

    Closing Price: 695p

  • RATING 13/12/17

  • PREVIOUS RATING N/A

DAVY VIEW

BetMGM updated on FY24 today, delivering 7% revenue growth for the full year to $2.1bn and an EBITDA loss of $244m, in line with guidance. Performance was negatively impacted in December by sporting results ($50m). The statement outlines that it exited the year with encouraging run rates across its key metrics, and normalised EBITDA was trending towards break-even in Q4. It now expects online sports to be contribution positive in FY25. For FY25, it expects revenue growth of 17% at the mid-point to $2.45bn, which is behind our forecast of $2.68bn. It expects EBITDA to turn positive in FY25 (+$250m yoy) and reiterated its expectation of $500m of EBITDA in the coming years, but it did not narrow the time frame. It outlines no further investment will be required from its parents. Overall, H2 saw some improving trends and market share stabilisation. The concern for BetMGM is that the two big operators continue to grow at a faster rate off a bigger base and get the associated scale benefits. Its explanation of how it will hold market share in the context of lower investment in the year ahead will be key on the 14:00 call as will any comments on the ownership structure.

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Feb 4 2025, 13:35 GMT

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