Fans of the most popular sport in the U.S. can now trade on game outcomes on Robinhood's app. Just don't call it "sports betting." https://t.co/yVwvaElto1 ...

He's the Babe Ruth of our time. But also about a year and a half ago, it came out that Shoi Otani had been at least through a bank account of his gambling millions of dollars on sports. Otani's story, which it seems like authorities have accepted, the league has accepted, is that it was actually his translator accessing his bank account.>> Everybody who covers sports business in some ways is waiting for the big sports story to happen in gambling. Everybody thought it was going to be the show Otani think as ...

Summary of Flutter Entertainment Fireside Chat - August 13, 2025 Company Overview - **Company**: Flutter Entertainment (FLUT) - **Key Focus**: iGaming and sports betting, particularly in the US and international markets Core Points and Arguments 1. **Strong Q2 Earnings**: Flutter reported nearly $400 million in revenue for June with a 22.5% EBITDA margin, indicating strong performance across its business segments, especially in the US [1][2] 2. **Market Positioning**: The company has successfully transitioned to a US primary listing and moved its headquarters to the US, enhancing liquidity and index inclusion [3][4] 3. **Profitability and Growth**: Flutter has reached profitability in the US and is experiencing strong operating momentum, with significant growth potential in international markets [5][6] 4. **Sustainability of Growth**: The company is optimistic about continued growth in both mature and new markets, particularly in iGaming, where penetration rates are still increasing [9][10] 5. **Cost Savings Initiatives**: Flutter is on track to deliver $300 million in cost savings, which is expected to enhance margins and operational efficiency [13][68] 6. **Regulatory Landscape**: The company is actively managing regulatory relationships and is prepared for potential tax increases, viewing them as manageable risks [25][27][63] 7. **International Expansion**: Flutter is focusing on strategic acquisitions, such as SNAI in Italy and NSX in Brazil, to strengthen its market position and drive growth [48][51] 8. **iGaming Leadership**: FanDuel has become the number one iGaming brand in the US, with a focus on improving customer experience and exclusive content [31][36] 9. **Live Betting Innovations**: Flutter emphasizes the importance of live betting and has developed features to enhance user experience, positioning itself ahead of competitors [45][46] 10. **Future Outlook**: The company is confident in achieving its long-term margin targets and continues to explore M&A opportunities while returning capital to shareholders through share buybacks [71][88] Additional Important Insights - **Market Dynamics**: Flutter is not currently seeing any competitive impact from prediction markets in states where it operates sports betting [22] - **Tax Strategy**: The company is educating lawmakers on the implications of tax policies, emphasizing the need for sustainable tax rates to avoid pushing customers to the black market [28][66] - **Performance in Italy and Turkey**: Flutter has seen significant growth in Italy and Turkey, with Turkey experiencing a 125% growth rate on a constant currency basis in Q2 [60][61] - **Cash Flow Management**: The company reported $156 million in free cash flow for the quarter, with tax payments affecting cash flow timing [75][76] This summary encapsulates the key points discussed during the Flutter Entertainment Fireside Chat, highlighting the company's strong performance, strategic initiatives, and outlook for future growth in the gaming industry.

Regulatory Change Impact - The One Big Beautiful Bill Act includes a tax provision impacting professional gambling [1] - Starting in 2026, the deduction for gambling losses will be capped at 90% of winnings [1] - This change could significantly impact legal sports betting [2] Economic Consequences - Taxing winnings without full loss offset could lead to taxation on unrealized profits [2] - Professional gamblers may move to offshore markets [2] - Reduced professional gambler volume could lead to less fair betting markets with wider odds and higher fees [3] - State governments could face reduced tax revenue due to offshore migration [3] Industry Implications - Some sports books might welcome the change, as professional gamblers reduce their profits [3] - Legal gambling activity may decline as a result of the tax change [3]

Industry Trend - The financial markets are becoming a modern avenue for gambling [1] - Sports betting is increasingly integrated into financial markets [1]

Career Reflection & Transition - Bob Costas retired from play-by-play announcing due to not wanting to perform below his lifetime average, focusing on interviews, commentaries, and essays in an emeritus position [2][3] - Costas initially considered stepping away from the Olympics after his 11th appearance but returned for a 12th due to the "Pink Eye" incident in Sochi [5][6] - He emphasizes the fulfillment of achieving his childhood dream and the satisfaction of diverse career experiences, including sports and non-sports broadcasting [12][14] Sports Broadcasting Industry Changes - The sports broadcasting landscape has changed with tech giants like Amazon, Apple, and Netflix entering live sports coverage, fragmenting viewership [37][39] - Increased accessibility of sports content diminishes excitement, with gambling adding a transactional aspect and the internet fostering harsher criticism [40][41] - Journalism in sports coverage has diminished, with a shift towards sound bites, arguments, and clickbait content [42] Sports Betting & Regulation - Sports betting is generating billions in revenue but also leading to financial problems for some, raising concerns about the need for more regulation [46][47] - Costas personally refuses to read gambling promos due to the insidious aspect of encouraging potentially addictive behavior [49] Baseball & Rule Changes - The introduction of the pitch clock in baseball was necessary to address the plotting, lethargic pace of games, shortening game times by approximately 45 minutes [50][51] - Costas dislikes the automatic runner on second base in the 10th inning, suggesting it should be implemented from the 11th inning onwards [52] Olympics & Storytelling - Compelling stories drive interest in the Olympics, especially domestic storylines involving American athletes [54][55] - Broadcasters play a crucial role in familiarizing viewers with competitors and their backstories, filling in the blanks for the audience [56][57] Mental Health in Sports - There should be more support for athletes' mental health, addressing challenges beyond maximizing performance [58][59] - Simone Biles' experience at the 2021 Olympics highlights the ongoing issue and differing reactions to athletes prioritizing mental health [63][64] Sports & Unification - Sports, especially team sports, can unify people from diverse backgrounds in the service of a common cause [66] - Large sports events bring together a broad audience across the demographic spectrum, but the tone surrounding sports can also be angry and accusatory [67][68] Politics & Sports - Politics has inevitably intersected with sports throughout history, and those who deny this are unaware of historical context [69] - The gun control issue was widely misunderstood, with Costas clarifying that it was about gun culture in sports, not the Second Amendment [73][74] Social Media & Media Literacy - Social media has changed how athletes communicate with fans, making it harder for traditional media to get close to them [89][90] - Media literacy is crucial for young people to determine what is credible and form their own opinions [94][95]

Core Viewpoint - Flutter Entertainment PLC reported quarterly earnings that missed both revenue and earnings estimates, leading to a decline in stock price, although some investors are reassessing the company's fundamentals and potential for recovery [1][4]. Financial Performance - Earnings per share (EPS) were $1.59, missing estimates of $1.89 [1]. - Revenue was reported at $3.67 billion, below expectations of $3.84 billion [1]. - Following the earnings report, FLUT stock dropped approximately 4% but later reduced losses to nearly half [4]. Market Context - The stock is down 6.3% in 2025, similar to DraftKings, which is down 7% [6]. - A lack of new sports betting initiatives in many states is contributing to the downward pressure on sports betting stocks [7]. - Flutter Entertainment and DraftKings benefit from online casinos, which provide a buffer against the struggles faced by traditional brick-and-mortar competitors [8]. Company Insights - Flutter's CEO attributed the earnings miss to "customer-friendly" outcomes during the NCAA Men's Basketball Tournament, where many favorites won, resulting in bettors winning their bets [10]. - The company remains confident in its pricing strategy and expects gross revenue margins to align with expected outcomes over time [11]. Industry Resilience - Sports betting is viewed as resilient during economic downturns, with consumers likely to continue engaging in betting activities even in tough conditions [12]. - The industry is also expected to be shielded from tariffs, making it a more stable investment compared to other discretionary sectors [12]. Analyst Ratings - Analysts have a consensus Buy rating on FLUT stock, with a 12-month price target of $306.28, indicating a potential upside of 26.87% from the current price of $241.41 [13][14]. - The stock has recently pulled back to its 50-day simple moving average, and traders are watching for support at this level [13].

Financial Data and Key Metrics Changes - The company reported record Q4 revenues of $35.3 million, with adjusted EBITDA of $14.7 million and free cash flow of $13.2 million, marking a 9% year-over-year revenue increase driven by casino revenue growth across all regions [6][16] - Full year 2024 revenue increased 17% to a record $127.2 million, with adjusted EBITDA rising 33% year-over-year to $48.7 million [19][20] - Gross profit increased 21% year-over-year to $33.1 million, with gross margin rising from 84% to 94% [17] Business Line Data and Key Metrics Changes - iGaming revenue grew significantly across all operating regions, with strong organic growth and benefits from the Freebets.com acquisition [11] - The acquisition of OzJam and Opticods is expected to drive substantial growth in subscription revenue, projected to account for over 20% of total group revenue [10][21] Market Data and Key Metrics Changes - Revenue in the UK and Ireland grew by 25%, while other Europe saw a 104% increase, and the rest of the world experienced an 81% rise, offsetting a 9% decline in North American revenue [19] - The company anticipates a return to growth in North America for 2025, driven by improved iGaming pricing trends and new state launches [12][21] Company Strategy and Development Direction - The company aims for full year revenue growth of 35% and adjusted EBITDA growth of 40% in 2025, with a long-term goal of generating $100 million in annual adjusted EBITDA [8][21] - Strategic acquisitions are a key focus, with the company successfully integrating new businesses to enhance its market position and drive shareholder value [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate challenges in the sports betting market and highlighted the resilience of the iGaming sector [12][58] - The company remains optimistic about the expansion of iGaming in the U.S. and expects significant top-line and cash flow growth as more states approve iGaming [12][21] Other Important Information - The company repurchased approximately 3 million shares at an average price of $9.06, representing nearly 9% of total outstanding shares [20] - The company expanded its credit facility from $100 million to $165 million, providing increased flexibility for strategic acquisitions [20][21] Q&A Session Summary Question: Insights on customer negotiations and market conditions - Management noted that the supply of traffic is a key driver, and they have successfully navigated challenges in the sports betting market by focusing on iGaming and strategic acquisitions [25][27] Question: Feedback on Optic Odds and market traction - Management indicated that they are optimistic about the international expansion of Optic Odds and its potential to solve critical risk management problems for operators [31][33] Question: Guidance nuances and regional growth - Management highlighted that North America is expected to be the fastest-growing region, driven by a change in traffic source mix and a focus on higher gross margins [39] Question: Capital allocation and stock repurchases - Management confirmed that they received consent to proceed with stock buybacks and will be tactical in their approach, focusing on mispriced stock opportunities [43][44] Question: Opportunities in sweepstakes and prediction markets - Management expressed cautious optimism about sweepstakes and highlighted the potential for prediction markets to grow the overall market [47][49] Question: Impact of higher taxes on the business - Management stated that increased taxes would affect the entire ecosystem but noted that their best clients are Tier two and Tier three operators, who are less impacted [51][52] Question: Organic growth rates and economic resilience - Management indicated that organic growth is expected to be in the low teens, with the industry historically showing resilience during economic downturns [60][58]

Financial Data and Key Metrics Changes - The company reported a revenue growth of 19% and adjusted EBITDA of $482 million, which is 26% higher than the previous year [7][22] - Net income for the quarter was $156 million, with earnings per share increasing by $5.59 to 45 cents [22] - Adjusted EPS, excluding certain fair value movements, increased by 67% due to a tax credit [22] Business Line Data and Key Metrics Changes - In the U.S., revenue increased by 14%, with adjusted EBITDA of $163 million, driven by a 43% growth in iGaming [23][25] - Sportsbook revenue growth was 8%, impacted by adverse sports results and a moderation in handle growth to 12% [23] - International revenue grew by 14%, with adjusted EBITDA increasing by 6% [25] Market Data and Key Metrics Changes - The U.S. sportsbook TGR market share reached 43%, while iGaming TGR market share was 26% [8][9] - In the UK and Italy, the company solidified its number one position, with UKI revenue growth of 20% driven by strong performance in both sportsbook and iGaming [26][17] - India showed a 72% growth on a year-over-two-year basis, while Australia experienced an 8% revenue decline due to a softer racing market [19][27] Company Strategy and Development Direction - The company aims to strengthen its leadership position in the U.S. market and expand into new markets, including the successful launches of FanDuel in North Carolina and Vermont [6][8] - The creation of Flutter Studios is expected to enhance game development capabilities and complement Tier one supplier content [7] - The company plans to repurchase up to $1 billion in shares across 2025, alongside acquisitions to enhance scale and diversification [8][28] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term business position despite short-term adverse sports results, emphasizing strong pricing and risk management capabilities [10][9] - The company is optimistic about the prospects for FanDuel and expects to materially expand its user base due to market-leading products [20] - Regulatory dynamics in the U.S. are being closely monitored, with management confident in mitigating potential impacts from state gaming tax increases [16][14] Other Important Information - The company is focused on product innovation, with a structural gross revenue margin of 14.5% in the quarter [11] - The introduction of new features and loyalty programs is expected to drive customer engagement and revenue growth [12][13] - The company is preparing for the integration of new acquisitions, including Snai and NSX, to enhance its market presence [19][76] Q&A Session Summary Question: U.S. Guidance and Investment Losses - Management discussed the expected launch of Missouri in Q4 and Alberta in Q1 2026, estimating $90 million in investment losses for new states [38][39] Question: Customer Acquisition Trends - Management noted strong growth in iGaming and emphasized the importance of product innovations in driving customer acquisition [45][46] Question: Italian Lottery Bid - Management confirmed interest in bidding for a second lottery contract in Italy, with ongoing evaluations of the opportunity [48][49] Question: Handle Growth and iGaming - Management clarified that there is no significant shift of players from sports betting to iGaming, attributing strong iGaming performance to product developments [96][97] Question: Tax Rates and Competitive Environment - Management provided insights on the impact of tax increases in Illinois, estimating a $50 million impact in 2024 [61][62] Question: Consumer Weakness Signs - Management indicated no signs of consumer weakness in existing U.S. states, with a focus on leveraging international market lessons [115]