Following an excellent first quarter of 2023, BetMGM is expected to be profitable by the year’s second half. That arrived a little earlier than intended.
BetMGM released its financials for the first half of 2023 on Wednesday, reporting positive (EBITDA) Earnings Before Interest, Taxes, Depreciation, and Amortization during the year’s second quarter.
For some online gaming firms, reaching profitability has proven a difficult task. However, BetMGM’s success in the online gambling business has served as a helpful launching pad to this point. That is certainly true in Michigan, where the company that operates is the primary iGaming provider.
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BetMGM is on Track to Generate Over $2 Billion in Revenue in 2023
BetMGM’s H1 report on Wednesday contained favorable primary news.
BetMGM had $944 million in net revenue for the initial half of 2023, in addition to a positive EBITDA in Q2. It maintains them on track for $1.8-2 billion in revenue this fiscal year.
“I am pleased with the substantial achievements we have accomplished during the first half of 2023 as we sustain our strong growth and remain on our path to profitability,” stated BetMGM CEO Adam Greenblatt in a news statement. “Our financial guidance for the year remains on track; we expect to generate $1.8 to $2.0 billion in revenue and to be EBITDA positive in the second half of 2023.” Indeed, we have achieved positive EBITDA for the entire second quarter of this year. Our focus continues to be on developing a sustainable, scalable, and return-focused business with leading products that our players can responsibly enjoy. We look forward to the rest of the year, bolstered by continued product enhancements, outstanding support from our shareholders, which allows us access to additional assets and collaborations, and, most importantly, our extraordinary BetMGM team.”
Along with the revenue figures, BetMGM states that it will be self-sufficient in the year’s second half, with no additional equity investment required beyond what it has already earmarked.
BetMGM Controls 27% of the Online Casino Business
BetMGM reported that it will control 27% of the online casino business by the second quarter of 2023. That figure is much higher in Michigan.
BetMGM Casino Michigan controls 36.1% of the revenue market for online casinos. It is expected to generate more than $1.3 billion in income in the state throughout its lifetime. The success of its online casinos throughout the country has led BetMGM to believe that it will be profitable by the end of 2022.
“BetMGM is the market leader in what is the most important financial segment in the country, iGaming, and is making significant strides toward profitability,” stated Bill Hornbuckle, CEO and President of MGM International, during the MGM International Q4 investor call.
While BetMGM has a connection with nearly half of the adult demographic because of its presence in 26 jurisdictions, the same cannot be said for iGaming.
Only Michigan, Pennsylvania, New Jersey, and West Virginia have access to BetMGM’s online casino. As more governments legalize iGaming, BetMGM appears poised to increase revenue and expand its already profitable portfolio.
BetMGM Reduces Sportsbook Costs
BetMGM has established itself as the third most popular online sports betting platform. The BetMGM owns 11% of the national sports betting market, trailing only FanDuel and DraftKings.
BetMGM Michigan will have 19% of the state’s online handle share in 2023. They also make up 16.9% of the state’s online sportsbook income. BetMGM’s initiatives to optimize player incentives have aided profitability. Cutting back on bonuses and marketing has been a priority, which appears to be a wise decision.
Bonus and promotional allocations in Michigan have decreased from $26.8 million in the first six months of 2022 to $15.8 million in the early six months of 2023.
BetMGM controls 18% of the global online gambling market, with its market shares in sports betting and online casinos. This figure is expected to rise as more statistics choose to enter the online casino sector, which BetMGM has shown to excel at.