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Caesars Entertainment has confirmed that its native Caesars Sportsbook app has been made available to download to the citizens of Massachusetts as of February 22. Since January 31, retail sportsbooks have been legally permitted to operate in the Bay State, with online sports betting slated to get the green light in March.
In a bid to steal a march on some of its competitors in Massachusetts, Caesars Sportsbook has opted to encourage bettors in the state to download the app and register accounts. They’ve even opted to promote pre-launch sign-up offers, incentivizing new customers for making pre-launch deposits with risk-free initial wagers. According to OddsChecker, its $1,250 no-lose promotion is one of the top-five sign-up promotions in the US sports betting market at present.
Eric Hession, president, Caesars Digital, described the launch as an “excellent complement” to the proposed retail sportsbook operated by Caesars at the “historic Raynham Park”. Caesars hopes to run a new retail sportsbook at this classic simulcast horse racing betting location just 40 miles south of Boston. Caesars will assume temporary control of the existing facility, with ambitious plans to create a brand-new purpose-built 30,000 sq. ft experience for sports bettors near Raynham Park. All of which is pending approval from the Massachusetts Gaming Commission.
Hession believes the combination of its popular app with Caesars’ proposed retail offering will enable the brand to “treat all sports fans like royalty” – a very on-brand message indeed.
Certainly, the Caesars Sportsbook app has achieved rave reviews among sports bettors in other US states where mobile sports betting has already been legalized. Caesars Sportsbook has an average rating of 4.5 out of 5 on Google Play, where it has already been downloaded well over 500,000 times stateside. It carries an even better average rating of 4.6 out of 5 on the App Store for iOS users on smartphones and tablets.
On February 21, Caesars Entertainment made its earnings call to shareholders and Caesars Digital proved to be one of the shining lights of its latest trading update. Caesars Digital, which spans the brand’s iGaming and online sports betting verticals, slashed its losses by an impressive $300m during Q4 2022, with the division now predicted to move into the black sometime this year.
In fact, thanks largely to Caesars Digital, Caesars Entertainment almost broke even for the final quarter of 2022. For the three-month period ending December 31, 2022, Caesars’ adjusted EBITDA was a modest $5m loss. Tom Reeg, CEO, Caesars Entertainment, said the latest data “sets the foundation for a strong 2023”. Not least for Caesars Digital, which the company anticipates being an “EBITDA contributor”, according to Reeg.
Reeg says the company anticipates Caesars Sportsbook and its online casino to be EBITDA positive. This would be a big deal for the US iGaming industry. For several years, the biggest operators have been content with being loss-making concerns while the dust settles and the industry begins to mature. It seems that the time for maturity is now.
FanDuel was the first US sportsbook brand to announce a quarterly profit. The Flutter Entertainment-owned operator now forecasts profitability throughout 2023. They aren’t the only ones to inch towards the black either. Both DraftKings Sportsbook and BetMGM have performed strongly, with the former posting a net loss of $0.53 per share in Q4 2022, as opposed to $0.80 per share in the same quarter the previous year. However, DraftKings does not forecast achieving full-year profitability until 2024.
From a pure sports betting perspective, Caesars Digital enjoyed a truly stellar 2022. Its total sports betting handle reached $12.8bn, which was almost 50% higher than its full-year 2021 handle. Its official regulatory documentation, submitted to the U.S. Securities and Exchange Commission, showed that its sports betting hold was up to 5.4% from 4.3% the previous year.
However, there is still work to be done as Caesars Sportsbook’s gross gaming revenue is still a distant fourth highest behind FanDuel Sportsbook, DraftKings Sportsbook and BetMGM. At its peak, Caesars Sportsbook enjoyed a market share of almost 12% in H1 2022, but by Q4 2022 this had fallen to just 6.2%.
Financial analysts have already been making long-term forecasts on Caesars Digital’s performance. Macquarie Research’s Chad Beynon believes FY25 will result in a positive EBITDA of $419m, more than double its projected FY24 EBITDA of $183m. Based on Macquarie’s financial modelling, Caesars Digital will be fully profitable in FY23.
However, CEO, Reeg admitted it could post a small loss for Q1 23 based on the launch costs surrounding its launch in the newly regulated Ohio market in January. Caesars Digital also went live in Maryland in November 2022, building its exposure after launching a brick-and-mortar sportsbook within the Horseshoe Baltimore Casino. Once live in Massachusetts, all attention will turn to which states Caesars Digital looks likely to target next.
There are three additional US states almost certain to be on the radar of Caesars Entertainment. The states of Maine and Nebraska have also passed sports betting legislation to legalize the industry in their respective states. With Massachusetts going live in March, it can’t be too long before online sportsbooks go live in the Pine Tree State and the Cornhusker State.
In Maine, Governor Janet Mills approved a bill which will see four tribes within the state having exclusive rights to online wagering. This means competition will be fierce among the leading US sportsbooks to secure a partnership deal with one of the tribes.
Milt Champion, director of the Gambling Control Unit in Maine, confirmed that sports betting markets could be made available to residents as soon as April. However, it could take several months longer, depending on the speed with which the unit finalizes its regulatory framework and its operator licenses.
As for Nebraska, limited sports wagering was legalized here back in May 2021. However, some possible tweaks to the legislation have created roadblocks to launching sportsbooks in the state. Furthermore, Nebraska’s legislation only permits retail sports betting, which would only enable Caesars to partner with a land-based operator, as opposed to creating an additional revenue stream for Caesars Digital.