BetMGM reports strong growth, eyes future investments

BetMGM sees revenue rise and increased user activity in H1 2024, and its CEO highlights investments and future growth plans despite current challenges.

On July 29, Entain, joint-owner of BetMGM, released a first-half update for 2024. While neither BetMGM nor Entain has publicly announced these numbers as of this writing, the release featured quotes from BetMGM CEO Adam Greenblatt while providing a potential update for traders and investors. 

The release highlighted a successful first half for BetMGM, while also underscoring the notion that there’s still plenty of work to do. 

BetMGM shows reasons for optimism

In terms of sports betting, BetMGM has reasons for optimism as it heads into the upcoming NFL season. 

Last year, BetMGM acquired Angstrom Sports, a sports analytics company. At the time of the purchase, the hope was that BetMGM could use their entire suite of analytics and risk pricing capabilities to allow the sportsbook to build new markets and features. 

Some of Angstrom’s capabilities were utilized at the end of the recently concluded NBA season, but most of it has been on display in the current MLB season. This has led to a 40% increase in active customers who placed an MLB same-game parlay this season. Overall, the volume of weekly MLB same-game parlays across the sportsbook has doubled compared to last year. 

BetMGM expects that Angstrom’s capabilities, as well as its single-account wallet, will be launched to their fullest capabilities in time for football season.

Overall, net revenue per active user was up 16% in the second quarter of 2024 compared to the second quarter of 2023. BetMGM is on the podium when it comes to nationwide sports betting market share, but is a distant third behind the top two operators. BetMGM makes up just about 7% of the market, while FanDuel and DraftKings account for nearly 80% of the betting landscape. 

BetMGM revenue grew 6% in the first half of 2024, reaching the $1 billion mark nationwide. This includes a 9% rise year-over-year from 2023 Q2 to 2024 Q2. 

The company has shown impressive growth in iGaming, showing 18% growth in the sector compared to the second quarter of 2023.

“Our iGaming business continues to perform strongly with attractive returns, and to maximize this strength and momentum, we plan to deploy additional marketing in the back half of this year,” Greenblatt said.

2024 is a year of investing for the future

While BetMGM can be proud of its growth and accomplishments over the past few months, it also realizes it has quite a ways to go if it wants to compete with both FanDuel and DraftKings in the online betting sector. As a result, the company has maintained that 2024 is a year of investing for the future that will hopefully pay dividends years from now. 

BetMGM posted a negative first half EBITDA of  $-123 million. EBITDA represents expenses before interest, taxes, depreciation and amortization. It’s a way of judging a company’s profitability. The negative number suggests BetMGM was far from profitable in the first half of 2024.

The company said then that the first half report was “consistent with expectations” and that it expected to post a similar number in the second half of the year, which would represent a full year EBITDA of nearly $-250 million.

BetMGM posted about achieving profitability in the second half of 2023, but at the same time realized some things needed to change. It warned that 2024 would likely involve reaching into its wallets and potentially acquiring debt. 

“The first half of this year has been very important in laying the groundwork for BetMGM’s future. 2024 is a year of investment. We’re focusing on improving our customer experience and stepping up our level of investment in players,” said CEO Greenblatt. 

At previous meetings, BetMGM claimed it wanted to reach $500 million in earnings and capture 25% of the U.S. market share by 2026. It’s changed that timeline to “the coming years,” which raises the question of how long of a process this might be.