Core Insights - The partnership between FanDuel and CME is set to enhance the legitimacy and accessibility of prediction markets in the U.S. [1][5] - FanDuel Predicts will launch in December, allowing users in states without traditional sports betting licenses to participate [3][5] - The prediction markets are regulated by the CFTC, which adds a layer of credibility to the offerings [5] Group 1 - FanDuel has been operating in the prediction market space for a long time and is now expanding its offerings [1][2] - The partnership with CME is expected to provide a robust platform for prediction markets, particularly in states like California, Texas, and Florida [4][5] - The launch of FanDuel Predicts will enable customers to access sports betting products without needing traditional gaming licenses [4][5] Group 2 - The experience of FanDuel in various international markets, such as the UK and Italy, supports its expansion strategy in the U.S. [2] - The collaboration aims to provide the best products available in prediction markets, enhancing user experience [3] - The upcoming launch is anticipated to attract a significant user base in states currently lacking sports betting options [3][5]

Core Insights - Flutter Entertainment reported a revenue of $3.79 billion for the quarter ended September 2025, reflecting a year-over-year increase of 16.8% [1] - The company's EPS was $1.64, significantly higher than the $0.43 reported in the same quarter last year, resulting in an EPS surprise of +1161.54% [1] - Revenue fell short of the Zacks Consensus Estimate of $3.86 billion, indicating a surprise of -1.65% [1] Financial Performance Metrics - International revenue was $1.9 billion, below the average estimate of $2.42 billion [4] - U.S. revenue reached $1.37 billion, slightly lower than the estimated $1.44 billion [4] - U.S. iGaming revenue was $530 million, exceeding the estimate of $515.17 million [4] - U.S. Sportsbook revenue was $783 million, compared to the average estimate of $840.37 million [4] - Other U.S. revenue was $55 million, below the estimate of $71.33 million [4] - International revenue from other regions was $229 million, surpassing the estimate of $211.55 million [4] - International Sportsbook revenue was $982 million, lower than the average estimate of $1.05 billion [4] - International iGaming revenue was $1.37 billion, slightly above the estimate of $1.34 billion [4] - International Other revenue was $75 million, exceeding the estimate of $66.86 million [4] - U.S. Sportsbook stakes totaled $10.65 billion, slightly above the estimate of $10.59 billion [4] - Revenue from Brazil was $87 million, below the estimate of $97.07 million [4] - Revenue from Central and Eastern Europe was $151 million, closely matching the estimate of $151.4 million [4] Stock Performance - Flutter's shares have returned -7.2% over the past month, contrasting with the Zacks S&P 500 composite's +4.6% change [3] - The stock currently holds a Zacks Rank 4 (Sell), suggesting potential underperformance relative to the broader market in the near term [3]

Core Viewpoint - Flutter Entertainment reported quarterly earnings of $1.64 per share, significantly exceeding the Zacks Consensus Estimate of $0.13 per share, marking an earnings surprise of +1,161.54% [1] - The company posted revenues of $3.79 billion for the quarter ended September 2025, which was below the Zacks Consensus Estimate by 1.65% [2] Financial Performance - Earnings per share (EPS) for the current quarter was $1.64, compared to $0.43 per share a year ago [1] - Revenue for the quarter was $3.79 billion, up from $3.25 billion year-over-year [2] - Over the last four quarters, Flutter has surpassed consensus EPS estimates four times and topped revenue estimates two times [2] Market Performance - Flutter shares have declined approximately 10.3% since the beginning of the year, while the S&P 500 has gained 16.4% [3] - The current Zacks Rank for Flutter is 4 (Sell), indicating expected underperformance in the near future [6] Future Outlook - The consensus EPS estimate for the upcoming quarter is $2.73 on revenues of $5.37 billion, and for the current fiscal year, it is $8.08 on revenues of $17.06 billion [7] - The gaming industry is currently ranked in the bottom 39% of Zacks industries, which may impact Flutter's stock performance [8]

Financial Data and Key Metrics Changes - Group revenue increased by 17% year-over-year, while adjusted EBITDA grew by 6% in Q3 2025 [5][19] - The company reported a net loss of $789 million for the quarter, compared to a loss of $114 million in the prior year, primarily due to a non-cash impairment charge of $556 million related to regulatory changes in India [18][19] - Adjusted earnings per share grew by 29%, while loss per share increased to $3.91 from $0.58 in Q3 2024 [18] Business Line Data and Key Metrics Changes - In the US, revenue was up 9%, driven by exceptional iGaming growth of 44%, while sportsbook revenue declined by 5% [18] - International revenue increased by 21% year-over-year, with acquisitions contributing 18 percentage points to this growth [19] - iGaming performance showed strong organic growth of 10%, particularly in Turkey and Italy [12][19] Market Data and Key Metrics Changes - Average monthly players engaging with products exceeded 14 million, contributing to revenue growth [5] - The company maintained a 47% market share in net gaming revenue (NGR) in September, despite competitive pressures [11][30] - The international division's revenue reached $2.4 billion, reflecting a 21% increase, with strong performance in Turkey and Italy [19] Company Strategy and Development Direction - The company is strategically positioning FanDuel to capture emerging prediction markets with the launch of FanDuel Predicts in December [6][17] - The focus remains on state-regulated sports betting and iGaming as the most valuable long-term opportunities in the US [8] - The company plans to invest significantly in FanDuel Predicts, anticipating an incremental EBITDA cost of $40-$50 million in Q4 2025 and $200-$300 million in 2026 [23][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the underlying business performance despite a reduction in full-year guidance due to customer-friendly sports results [5][21] - The competitive landscape has seen heightened generosity from competitors, impacting initial NFL season performance, but management remains optimistic about long-term growth [11][30] - The company is closely monitoring the regulatory environment in India and remains engaged with policymakers regarding potential gaming tax increases in the UK [15][16][60] Other Important Information - The company completed share repurchases totaling $225 million in Q3 and plans to continue the program into 2026, with a commitment to return $5 billion over the coming years [20][21] - The integration of recent acquisitions is progressing well, with a focus on delivering synergies and enhancing the iGaming proposition [13][14] Q&A Session Summary Question: Can you elaborate on the planned investment for FanDuel Predicts? - Management expressed excitement about the product and emphasized a disciplined approach to customer acquisition, monitoring CAC to LTV dynamics closely [25][26] Question: How widespread was the competitive generosity seen at the start of the NFL season? - Management noted that while there was heightened generosity, they maintained a disciplined investment posture and were pleased with their market share performance [30][31] Question: What is the outlook for trading in September and into Q4 in the US? - Management reported strong momentum into Q4, with double-digit handle growth and a positive start to the NBA season [30][31] Question: Can you provide insights on the prediction markets and regulatory engagement? - Management highlighted extensive engagement with stakeholders and optimism about accelerating state legalization of sports betting [34][35] Question: How do you view the competitive landscape with new partnerships like ESPN and DraftKings? - Management acknowledged the competitive dynamics but emphasized their strong product offering and successful partnerships, particularly with Amazon [56]

Group 1 - The sports betting firm is launching a stand-alone prediction market app called FanDuel Predicts [1] - The app is being developed in partnership with CME Group [1]

Core Insights - Flutter Entertainment Inc. reported mixed third-quarter earnings, with earnings per share of $1.64 surpassing the Street estimate of 86 cents, while quarterly revenue of $3.79 billion fell short of the analyst estimate of $3.9 billion [1][2] Financial Performance - The company experienced a solid third quarter, with continued momentum in both US and International businesses, maintaining its position as the number one operator in the U.S. [2] - The adjusted EBITDA for Q3 was reported at $51 million, reflecting a 12% year-over-year decline [4] Revenue Outlook - Flutter lowered its fiscal 2025 revenue outlook to $16.69 billion from the previous estimate of $17.05 billion [2] Market Reaction - Following the earnings report, Flutter Entertainment's stock was down 2.1% in extended trading, priced at $229.50 [3] Business Segment Performance - Sportsbook revenue declined by 5% year-over-year due to temporary impacts from sports results and high levels of competition during the NFL season start [4] - The company noted a 10% year-over-year handle growth in Q4 to date, attributed to increased investment in FanDuel and a strong start to the NBA season [4]

Core Viewpoint - Flutter, the world's largest online betting company, has significantly reduced its full-year profit growth forecast due to a prolonged winning streak by gamblers, which has led to increased payouts [1] Company Summary - Flutter's revised profit growth forecast indicates a challenging financial outlook for the company, primarily driven by the impact of higher payouts to gamblers [1] Industry Summary - The online betting industry is experiencing fluctuations in profitability as a result of changing gambler behavior, particularly during winning streaks that can strain company finances [1]

Acquisitions and Market Expansion - Flutter Entertainment completed the acquisition of Pluto (Italia) S.p.A for approximately $2.6 billion (€2.3 billion), enhancing its position in the Italian market [178]. - The company acquired a 56% interest in NSX Group for BRL 3,819 million ($678 million), expanding its reach in the Brazilian market [179]. - Brazil launched its regulated market for online sports betting and casino on January 1, 2025, with Flutter receiving a provisional license [194]. - Flutter has obtained five new online gaming licenses in Italy as part of the reorganization of the gambling sector, which aims to improve player protection [191]. - The company plans to continue investing in product development and market expansion to sustain growth momentum in the upcoming quarters [260]. Financial Performance - Revenue increased by 17% to $3,794 million for the three months ended September 30, 2025, compared to $3,248 million for the same period in 2024 [199]. - Adjusted EBITDA rose by 6% to $478 million for the three months ended September 30, 2025, with an Adjusted EBITDA margin of 12.6%, down from 13.9% [211]. - Net loss increased to $789 million for the three months ended September 30, 2025, compared to a net loss of $114 million in the same period in 2024, resulting in a net loss margin of 20.8% [210]. - Adjusted EBITDA increased by 18% to $2,013 million, with the adjusted EBITDA margin rising from 16.6% to 17.3% [253]. - Net loss increased to $417 million for the nine months ended September 30, 2025, compared to a net income of $6 million in the prior year [252]. Revenue Breakdown - U.S. segment revenue grew by 9% to $1,368 million, with AMPs increasing by 8% period over period [215]. - iGaming revenue in the U.S. segment increased by 44% year-over-year, while sportsbook revenue decreased by 5% due to competitive pressures [201]. - Total revenue for the International segment increased by 21% to $2,426 million for the three months ended September 30, 2025, driven by a 10% increase in AMPs and acquisitions contributing 18% [227]. - Sportsbook revenue increased by 11% to $982 million for the three months ended September 30, 2025, with stakes growing 13% [228]. - iGaming revenue increased by 31% to $1,369 million, with acquisitions contributing 21% to the revenue growth [230]. Costs and Expenses - Cost of sales increased by 24% to $2,168 million, with cost of sales as a percentage of revenue rising to 57% from 54% year-over-year [202]. - General and administrative expenses surged by 60% to $702 million, primarily due to revised market access terms and consolidation of acquisitions [205]. - Technology, research and development expenses rose by 29% to $275 million, driven by investments in corporate technology and impairment of assets in India [203]. - Sales and marketing expenses increased by $220 million to $2,595 million, with a decrease in U.S. segment expenses by 5% [246]. - The overall increase in cost of sales as a percentage of revenue was 300 basis points, primarily due to acquisitions contributing 200 basis points [239]. Impairments and Liabilities - Goodwill impairment of $517 million was recorded due to the cessation of operations in India, significantly impacting operating results [206]. - The company incurred impairment charges of $559 million related to Junglee due to the ban on online real money gaming in India [290]. - As of September 30, 2025, the company had material cash requirements from known contractual obligations totaling $6,499 million [299]. - Long-term debt as of September 30, 2025, totaled $12 billion, with $52 million due within 12 months [294]. Regulatory Environment - The regulatory environment in Australia has evolved, with increased point of consumption tax rates impacting operational costs for online betting [193]. - The UK Gambling Commission's new regulations may impose more stringent restrictions on the betting and gaming industry, potentially affecting Flutter's operations [190]. Cash Flow and Financing Activities - Net cash provided by operating activities decreased by $194 million, or 20%, to $756 million for the nine months ended September 30, 2025, compared to $950 million in 2024 [301]. - Net cash used in investing activities increased by $2,488 million, or 385%, to $3,135 million for the nine months ended September 30, 2025, primarily due to acquisitions [303]. - Net cash provided by financing activities increased by $2,761 million, or 1,132%, to $2,517 million for the nine months ended September 30, 2025, driven by significant proceeds from various credit agreements [304]. Market Trends and Player Metrics - The average monthly players (AMPs) metric is used to assess underlying trends, with a focus on online players only, excluding retail activity [173]. - Total Group AMPs increased by 9% to 14 million for the three months ended September 30, 2025, compared to 12.9 million in the prior year [201]. - Total Group AMPs increased to 15,509 for the nine months ended September 30, 2025, compared to 13,662 for the same period in 2024 [240].

Financial Performance - Q3 2025 revenue increased by 17% year-over-year to $3,794 million, with average monthly players (AMPs) growing by 9% to 14,133,000[4] - The net loss for Q3 2025 was $789 million, significantly higher than the $114 million loss in Q3 2024, primarily due to a non-cash impairment charge of $556 million related to regulatory changes in India[10] - Adjusted EBITDA for Q3 2025 was $478 million, reflecting a 6% increase year-over-year, with an adjusted EBITDA margin of 12.6%[4] - Total revenue for the quarter reached $3,794 million, a 17% increase year-over-year, with organic iGaming revenue growth of 19% offsetting customer-friendly sports results[42] - iGaming revenue surged by 35% year-over-year to $1,899 million, driven by a 30% increase in average monthly players[41] - Q3 adjusted earnings per share rose by 29% to $1.64, supported by strong performance in both US and international markets[6] - Adjusted EBITDA grew by 6% to $478 million, with an adjusted EBITDA margin of 12.6%, reflecting a 130 basis point decrease year-over-year[45] - International revenue increased by 21% year-over-year to $2,426 million, with Brazil showing remarkable growth of 412%[52] - The company reported a loss on existing equipment of $9 million, indicating challenges in asset management[106] - Net income for the three months ended September 30, 2025, was a loss of $789 million, compared to a loss of $1,114 million in the same period of 2024[106] Revenue Guidance and Projections - Full-year 2025 revenue guidance has been updated to $16.69 billion, representing a 19% year-over-year growth, with adjusted EBITDA expected at $2.915 billion, a reduction from previous guidance by $570 million[8] - The updated 2025 guidance includes a Group revenue of $16.69 billion and adjusted EBITDA of $2.915 billion, representing year-over-year growth of 19% and 24%, respectively[65] - US revenue and adjusted EBITDA are projected at $7.17 billion and $935 million, reflecting year-over-year growth of 24% and 84%, respectively[66] - International revenue is expected to reach $9.52 billion with adjusted EBITDA of $2.24 billion, indicating year-over-year growth of 15% and 8%, respectively[67] Strategic Initiatives - The launch of "FanDuel Predicts" is scheduled for December 2025, aimed at expanding the customer base in states without regulated sports betting[12] - Flutter is focused on expanding its portfolio in the US, including the launch of FanDuel Predicts, to leverage market leadership and diversification strategies[37] - The integration of Snai is progressing well, with enhanced iGaming propositions and increased customer acquisition volumes expected to drive synergies[30] - Flutter extended its strategic partnership with Boyd Gaming to 2038, acquiring a 5% stake in FanDuel for approximately $1.553 billion, expected to save $65 million annually starting July 2025[4] Costs and Expenses - Sales and marketing expenses rose by 19% year-over-year, accounting for 17.0% of total revenue, benefiting from growth in regions with lower marketing costs[58] - The cost of sales as a percentage of revenue increased by 300 basis points to 48.1%, influenced by acquisitions and higher taxes in certain regions[57] - The company incurred restructuring and integration costs of $218 million for the twelve months ended September 30, 2025[122] Cash Flow and Debt - Available cash increased by $244 million year-over-year, closing at approximately $1.7 billion, while net debt was $10,602 million at the end of Q3 2025, resulting in a leverage ratio of 4.0x[61] - Cash provided by operating activities was $2,092 million, compared to $2,900 million in the previous year[106] - Total debt as of September 30, 2025, was $12,099 million, with net debt standing at $10,602 million, resulting in a leverage ratio of 3.7x[124] Market Conditions and Challenges - The cessation of real-money gaming in India is expected to adversely impact future results in the APAC region[84] - Future outlook remains cautious due to ongoing market volatility and operational challenges[106] - The company remains engaged with policymakers regarding potential gaming tax increases in the UK, emphasizing the industry's contribution to tax revenues and employment[32] Other Financial Metrics - The leverage ratio increased to 4.0x as of Q3 2025, reflecting the impact of recent acquisitions and strategic investments[4] - Free Cash Flow is defined as net cash from operating activities minus capital expenditures, providing insight into cash generation capabilities[102] - Adjusted EBITDA margin is calculated as adjusted EBITDA as a percentage of revenue, offering a view of operational efficiency[93] - Constant currency growth rates are used to assess performance without the impact of fluctuating foreign exchange rates, enhancing comparability[88]

Core Insights - Flutter Entertainment reported a solid Q3 performance with a 9% increase in average monthly players (AMPs) and a 17% rise in revenue year-over-year, driven by acquisitions and organic iGaming growth [2][3][8] - The company experienced a significant net loss of $789 million, primarily due to a non-cash impairment charge related to regulatory changes in India and a payment to Boyd for market access [4][8][39] - Flutter plans to launch "FanDuel Predicts" in December, aiming to capture new market opportunities in states without regulated sports betting [3][10][15] Financial Performance - Average monthly players (AMPs) increased to 14,133, up from 12,920, representing a 9% year-over-year growth [2] - Revenue for Q3 reached $3,794 million, compared to $3,248 million in the previous year, marking a 17% increase [2] - Adjusted EBITDA was $478 million, a 6% increase from $450 million in Q3 2024, with an adjusted EBITDA margin of 12.6% [2][40] - The net loss margin was 20.8%, with a loss per share of $3.91, significantly higher than the previous year's loss of $0.58 [2][4] US Market Insights - In the US, revenue grew by 9% year-over-year, driven by a 44% increase in iGaming revenue, while sportsbook revenue declined by 5% due to customer-friendly sports results [3][16] - FanDuel's handle growth in Q4 has shown a positive trend, with a 10% year-over-year increase to date, supported by strong NBA season performance [5][58] - The company holds a 47% net gaming revenue share in the online sports betting market as of September [20] International Market Insights - International revenue grew by 21% year-over-year, with adjusted EBITDA of $505 million, reflecting strong contributions from recent acquisitions [26][50] - The cessation of real-money gaming in India negatively impacted organic growth, while iGaming continued to thrive in regions like Turkey and Italy [35][49] - Brazil showed exceptional growth with a 412% increase in revenue, driven by the Betnacional acquisition [33][49] Strategic Developments - The launch of "FanDuel Predicts" is expected to unlock new growth opportunities by offering a sports product in states without current access to sports betting [10][15] - Flutter's strategic investments and acquisitions are aimed at enhancing its market position and driving sustainable growth [7][36] - The company is focused on maintaining a disciplined approach to investment while monitoring returns to build long-term value for shareholders [14][36] Guidance and Outlook - The updated guidance for 2025 anticipates group revenue of $16.69 billion and adjusted EBITDA of $2.915 billion, reflecting year-over-year growth of 19% and 24%, respectively [6][59] - The guidance incorporates the impact of Q3 performance, Q4 sports results, and investments in FanDuel Predicts and market access [6][59] - Flutter expects to continue leveraging its market leadership in the US and diversify its international business for future growth [36][61]