Sports betting brand PointsBet has shared its financial results for the period that ended September 30. For the first quarter of FY2023, the brand’s turnover rose by 18% to AUD1.15 billion ($742.8 million). However, gross win was AUD115.1 million ($74.3 million), down by 1.7% from AUD117.1 million ($75.6 million) in the same period last year.
Net profit for PointsBet’s sports betting vertical was up 4% at $70.3 million, while net profit for its iGaming services rose 287% to $5.4 million. Total net profit across PointsBet’s verticals totaled $50.8 million, up 13% on Q1 2022. The latest results come as the business revealed a change in its US strategy to focus less on casual customers and more on high-volume bettors.
In the United States, while handle rose by 50% to AUD523.8 million ($338.3 million) for Q1 2023, figures were down sequentially by 24%. This could be due to a limited number of high-profile sporting events over the quarter.
However, despite posting net profits for sports betting 78% higher year-over-year, the region saw profits drop 6% sequentially. PointsBet’s iGaming segment in the US saw the greatest gains across the board, rising 229% year-over-year and up 8% quarter-over-quarter.
However, the success was not shared in Australia, where PointsBet’s handle dropped by 3% compared to the prior-year period. During the quarter, its generated revenue stood at AUD73 million ($47.1 million), down 17% year-over-year and 8% from Q4 2022. The company’s profits from Australia took a 13% hit year-over-year, and a 14% fall sequentially.
The brand saw greater success in Canada, a new market for the brand as it launched in the country in April this year. Handle rose by 31% from Q4 2022, while revenue saw a marked sequential rise of 138%. Moreover, iGaming in the region saw success too, rising 96% in the company’s latest financial results. PointsBet’s total net win in Canada stood at AUD1.7 million ($1.09 million), an 887% sequential rise.
The total revenue for the quarter, made up of B2B and B2C operations, was AUS$81.5 million ($52.6 million). In terms of costs, advertising and marketing made up the highest expense at AUS$54.7 million ($35.3 million). However, according to the company, PointsBet has reduced marketing spend significantly in the first quarter.
Johnny Aitken, Chief Executive Officer at Pointsbet US, said: “This year we took a measured approach to the launch of the new NFL season. We spent 70% less in total marketing during the quarter compared to the previous corresponding period as well as significantly reducing promotions as a percentage of gross win.”
Product manufacturing and operating costs came to AUD40.9 million ($26.4 million), while staff costs amounted to AUD27.5 million ($17.7 million). After administration and corporate costs, which added up to AUD17.1 million ($11.04 million), the business reported a loss of AUD58.8 million ($37.9 million). After interest, the total net loss was AUD44.9 million ($29 million).
Other highlights of the quarter include PointsBet’s launch in Louisiana through a partnership with Penn Entertainment. The company also launched retail sports betting in Maryland and began offering online sports betting in Kansas.
“During the quarter, we launched two new online sports betting states in Kansas and Louisiana. Kansas was launched at the start of September and we are satisfied with our investment in the state with our early performance. Our focus in all states is to lead on product and make revenue,” the CEO stated.
“We continue to take learnings from new state launches and are primed to capitalize on our next two market launches in Maryland and Ohio. Our high priority state for PointsBet continues to be Illinois, one of the largest online sports betting revenue markets, and one of our best performing states,” the CEO concluded.
See PointsBet’s full Q1 FY23 report here.