DraftKings stock has tumbled 12% in morning trading despite the sports-betting company beating earnings estimates in the fourth quarter.
The company raised its revenue guidance for 2022 but its adjusted Ebitda guidance came in worse than expected, signaling more losses ahead.
The sports betting company reported an adjusted loss of 35 cents a share on revenue of $473 million in the fourth quarter, beating estimates on both fronts.
Analysts surveyed by FactSet expected DraftKings (ticker: DKNG) to report a loss of 81 cents a share on revenue of $446 million. A year earlier, DraftKings posted a loss of 68 cents a share on revenue of $322 million.
DraftKings raised its 2022 revenue guidance to a range of $1.85 billion to $2 billion from a previous forecast of $1.7 billion to $1.9 billion but introduced guidance for adjusted Ebitda to be negative $825 million to $925 million in 2022.
That’s well below analyst estimates for a $699 million loss.
DraftKings is the No. 2 operator in the U.S. online sports gambling behind FanDuel, which is controlled by European gambling giant Flutter Entertainment.
The gambling giant’s stock has fallen more than 60% since Labor Day as investors have weighed up increasingly intense competition in the sports betting sector and the company’s heavy losses.