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DAZN ‘expects profitability’ despite losses widening in 2023

DAZN remains a loss-making enterprise, according to its latest filings with Companies House, despite signing a plethora of prominent new media rights deals over the past two years.

Howeever, publishing its strategic report with the UK business registry this month, DAZN did assert that it ‘expects to continue driving improvements in margin towards profitability’.

It is also confident that the continuing growth of its media rights business, entry into new markets and the activity of its DAZN Bet sportsbook will provide it with additional revenue and advertising streams.

Launched in 2023, the sportsbook has since gone live in the UK, Italy, Spain and Germany. Two years on from its sportsbook project being launched, DAZN continues to maintain confidence in its brand as the company positions itself at the convergence of media and betting.

In the report, DAZN revealed an operating loss of $1.38bn in 2023. This marked a 2.3% increase from $1.06bn the year prior.

The company attributed this to ‘some key exceptional items’ which impacted its ‘positive underlying position’ for 2023. The impact of paying licence fees for high profile tournaments may have had an impact on this.

In the group’s update to companies house, DAZN noted that media rights payments for licences of between three and five years are a substantial but necessary cost due to the nature of its business.

The costs of growth

Looking back to 2023, in that year alone the company extended its US-facing agreement with Matchroom Boxing, signed a sub-licencing deal with French Ligue 1 broadcaster Canal+, and renewed both its Spanish Formula One deal and Italian Serie A partnership.

DAZN has secured a podium position in sports broadcasting in recent years via deals with organisations like those listed above. It further enhanced its profile this year via domestic partnerships with France’s Ligue 1 and England’s National League System – with Premier League rights having been a target for some time.

The company has never recorded a profit in its nine year history, however, and its operating loss continues to widen. Despite this, the company remains confident in its future prospects and has previously stated that it expected profitability in 2024. Whether or not this will be achieved will be seen this time next year.

Boosting the company’s confidence is the fact that its revenue grew in 2023 despite losses mounting. Total revenue stood at $2.3bn, an increase of 30% from $2.2bn the year prior, while adjusted EBITDA rose 25% from a loss of $1.1bn to a gain of $830m.

It also continues to benefit from investment support from its key shareholders. Access Industries, Len Blavatnik’s multinational investment firm, has supported DAZN with $6.7bn to date since securing the majority share in the company in 2016. In his latest cash injection, Blavatnik pumped another $827m into the firm via Access Industries.

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