Slide 1: Q3 2024 Earnings Presentation
Q3 2024 EARNINGS PRESENTATION November 7, 2024 | 1
Slide 2: Legal Disclaimer
Legal Disclaimer Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, including statements about DraftKings Inc. (“DraftKings”,
Slide 3: Q3 and current business highlights
Q3 and current business highlights 1 Achieved strong Q3 2024 results across our core value drivers including CAC(1), engagement, sportsbook hold percentage, and promotional reinvestment 2 Expecting healthy revenue growth for the remainder of this year after we experienced the most customer-friendly
Slide 4: We continue to expect FY 2025 Adj. EBITDA of $900M to $1.0B
We continue to expect FY 2025 Adj. EBITDA(1) of $900M to $1.0B FY 2024 Revenue YTD 2024 Sport Remaining Expected FY 2025 Revenue Guidance Outcome Revenue FY 2025 Revenue Guidance Midpoint: $4,900M Impact: $327M Growth: $1,173M Midpoint: $6,400M $950 $461 Millions of Dollars $489 $229 $260 FY 2024 Ad
Slide 5: Revising FY 2024 revenue guidance and FY 2024 Adj. EBITDA guidance
Revising FY 2024 revenue guidance and FY 2024 Adj. EBITDA(1) guidance Updated FY 2024 Guidance vs. Prior FY 2024 Guidance $ Millions Customer-friendly FY 2024 Guidance Sport Outcomes Promotional Optimization FY 2024 Guidance Provided 8/1/2024(2) in Q4 2024 and Expense Efficiency Provided 11/7/2024(3
Slide 6: Upgraded our NBA product offering with the goal of leading across all sports
Upgraded our NBA product offering with the goal of leading across all sports • Recognized(1) as #1 U.S. Mobile Sportsbook App • Ranked #1 in the report’s User Experience, Betting Interface, and Features categories • Upgraded Our NBA Product Offering Powering Our Own Sports Betting Content • Offering
Slide 7: Appendix
APPENDIX | 7
Slide 8: NFL sport outcomes have been customer-friendly in Q4 2024
NFL sport outcomes have been customer-friendly in Q4 2024 Distribution of Actual NFL Hold Percentage By Week(1) 1 October 2024 through November 4, 2024 September 2022 through September 2024 2 Number of Weeks 17 1 10 7 6 5 1 1 1 1 -15% to -10% -10% to -5% -5% to 0% 0% to 5% 5% to 10% 10% to 15% 15% t
Slide 9: The number of unique customers on our platform is rising
The number of unique customers on our platform is rising Unique Customers in the Prior Twelve Months(1) 9.3 8.4 7.5 7.1 6.6 6.2 6.0 5.2 4.9 Millions 4.4 4.5 4.0 3.8 3.4 3.2 2.6 2.4 1.9 1.9 1.9 1.9 1.9 1.7 1.7 1.7 1.7 1.8 1.8 1.4 0.9 0.8 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
Slide 10: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation includes Adjusted EBITDA and Free Cash Flow, which are non-GAAP financial measures that DraftKings uses to supplement its results presented in accordance with GAAP. The Company believes Adjusted EBITDA and Free Cash Flow are useful in evaluating its oper
Slide 11: Reconciliation of GAAP Operating Expenses to Non-GAAP Operating Expenses
Reconciliation of GAAP Operating Expenses to Non-GAAP Operating Expenses GAAP to Non-GAAP Operating Expense Reconciliation $ Millions 30-Sep-24 30-Jun-24 31-Mar-24 31-Dec-23 30-Sep-23 30-Jun-23 31-Mar-23 31-Dec-22 30-Sep-22 30-Jun-22 31-Mar-22 GAAP Operating Expenses Cost of Revenue $742 $663 $710 $
Slide 12: Reconciliation of Net Income (Loss) to Adjusted EBITDA
Reconciliation of Net Income (Loss) to Adjusted EBITDA Net Income (Loss) to Non-GAAP Adjusted EBITDA Reconciliation $ Thousands Three months ended September 30, Q3 2024 Q3 2023 Revenue $ 1,095,490 $ 789,957 Cost of revenue 742,434 543,454 Sales and marketing 339,943 313,323 Product and technology 10
Slide 13: Non-GAAP Adjusted Basic Earnings (Loss) Per Share Reconciliation
Non-GAAP Adjusted Basic Earnings (Loss) Per Share Reconciliation Adjusted Basic Earnings (Loss) Per Share Reconciliation: Three Months Ended September 30, 2024 Dollars ($0.17) $0.14 $0.11 $0.18 ($0.60) GAAP Reported EPS (1) Stock Based Compensation Amort. of acq. intangibles Other Non-GAAP Adj.(2) A
Slide 14: DraftKings Share Count Detail
DraftKings Share Count Detail Share Count as of September 30, 2024 Thousands Common Shares Outstanding (30-September-24) 485,426 Vested Stock Options @ TSM(1) 20,863 Memo: Vested Stock Options 23,067 Diluted Shares Outstanding (With Vested Stock Options @ TSM) 506,289 DEAC Private Placement Warrants
Slide 15: DraftKings KPI Comparison
DraftKings KPI Comparison Key Performance Indicators Millions; Dollars Monthly Unique Payers (“MUPs”) Three months ended September 30, — We define MUPs as the number of unique paid users per month who had one or more real-money, paid engagements across one or more of our Sportsbook, iGaming, DFS,