MGM Resorts and Entain Plc have issued a joint statement on their US venture BetMGM, that targets a net revenue result of $1.3 billion for 2022 trading.
Of significance, the venture will aim to be EBITDA results positive in 2023, marking a significant milestone for the business that was launched in the summer 2018.
The two group’s aim to maintain BetMGM’s momentum across the states in which it operates, where the venture has secured its position as the second largest firm providing betting and igaming services with a 24% market share in Q3 2021 – in line with group objectives of maintaining a 20% to 25% market lead.
“As we look to 2022, we are beyond excited about further integrating BetMGM with our MGM loyalty program and land-based operations to elevate the BetMGM player experience. We are more confident than ever about BetMGM’s future prospects and remain committed to its continued success.” – read Bill Hornbuckle, CEO & President of MGM Resorts statement.
Currently, BetMGM is active in 19 US jurisdictions, offering sports betting in all and igaming in four. Entain and MGM have detailed a combined objective of further enhancing this market position, targeting the states of Illinois and Louisiana in Q1 2022.
The firm also expects to go live in Puerto Rico with retail sportsbooks, and enter the Canadian market to offer both online sports wagering and igaming in the province of Ontario later on in the year.
Completion of these expansion plans will allegedly see BetMGM expand its reach to 40% of customers in the US, on top of the access secured to further betting markets in Canada.
In support of these objectives, Entain and MGM have detailed investment plans for an injection of up to $450 million – bringing total combined investment from 2018 onwards to $1.1 billion – as the duo also look to expand BetMGM’s bingo product and racing app into more territories.
The venture partners underlined BetMGM’s cost per acquisition (CPA) that were in-line with management expectations of $250, below the reported costs of US competitors.
“Player values in line with expectations, supporting long-term total addressable market opportunity in North America of approximately $32 billion,” – read MGM’s update.
Leadership of BetMGM underscored the venture’s capacity to achieve a ‘positive contribution’ across regulated states within ‘one year of launch’ – a dynamic that sees MGM Resorts and Entain positive of the venture achieving its headline 2023 EBITDA positive target.
Operating objectives, see BetMGM continue its mission to become US wagering’s dominant omni-channel and data-driven operator, providing best in-class rewards and experiences for its customers.
Closing 2021 trading, the operator expects an EBITDA loss of between $420 and $440 million, although maintaining that net revenue will stand at $850 million.
This marks a 140% state-state growth in net revenue for the company, a figure which BetMGM maintains is “ahead of management expectations and up nearly five times from prior year”.
Jette Nygaard-Andersen, Group CEO of Entain Plc commented: “BetMGM is built on Entain’s best in class technology and capabilities alongside MGM Resorts iconic brand and assets. Its fantastic success so far demonstrates that BetMGM has really captured the excitement of customers across the states where it operates. ”
“BetMGM continues to outpace the market as a result of its unique assets and go to market approach, broad and highly engaging range of in-house products and digital marketing capabilities. Given the long term opportunity and shareholder value potential in winning in this market, we are very happy to support BetMGM in this investment phase of its growth journey and we are absolutely committed to providing BetMGM with what it takes to win.”