Flutter: Paddy Power owner loses over £300m on bad US bets
Flutter, the gambling giant owner of Paddy Power, has downgraded its revenue estimates for 2024 by $390m (£312m) after a period of “very unfavourable US sports results”.
In a stock exchange notice, the Fanduel owner reported that November and December had seen a surge in unfavourable results for the bookie, especially in American football parlay outcomes.
A parlay allows a bettor to make multiple wagers and tie them to the same bet, and has become particularly popular in the US following the legalisation of sports gambling in the country.
“The 2024/2025 NFL season to date has been the most customer friendly since the launch of online sports betting with the highest rate of favourites winning in nearly 20 years,” said Flutter.
While the group said it remained confident in its long-term growth trajectory, the temporary hit has caused gross gaming revenue to fall by as much as $438m (£350m) between 12 November and the end of the year.
This has led Flutter to reduce its US revenue estimates for 2024 by $370m (£296m), and adjusted operating profit estimates down from $670m-$750m to just £505m (£404m).
This will leave the firm’s US revenue in the fourth quarter at about $1.6bn (£1.3bn), with an adjusted operating profit of around $161m (£129m).
Despite the US losses, favourable results in the Premier League meant that revenue outside the US will be about one per cent higher than had been estimated by Flutter earlier this year.
The group’s full fourth quarter earnings are due out on 4 March.
In May 2024, the gambling giant moved its operational headquarters from London to the US, after making a secondary listing on the New York Stock Exchange in January.
The move was seen as yet another blow to the London Stock Exchange, with Flutter paying greater attention to its “rapidly scaling” US business.