Speaker 1: Right shares of draftings honestly bouncing all over the place,
Speaker 1: but currently up almost five percent after reporting third quarter results.
Speaker 1: Look at that stot Go five percent gain. The Sports
Speaker 1: Bending Company cut his full year revenue forecast below analyst estimates,
Speaker 1: reported a wider and then expected loss per share. That
Speaker 1: gets Drafting CEO Jason robbins, there's this idea that the
Speaker 1: streets fixated on that there were customer friendly outcomes, particularly
Speaker 1: in the realm of NFL. Is that true to your mind?
Speaker 1: What's a customer friendly outcome?
Speaker 2: Well? Q three actually we said that we had neutral outcomes,
Speaker 2: so you know, we had exactly kind of as we expected,
Speaker 2: and we ended up having a beat in Q three,
Speaker 2: which is great. Q four, aside from these outcomes, would
Speaker 2: have been on track for the same So you know,
Speaker 2: basically what it means is that the favorites won a
Speaker 2: lot and the big name players scored touchdowns and had
Speaker 2: a lot of yards. And sometimes that happens in sports.
Speaker 2: You know, the book sometimes wins, sometimes the customers win.
Speaker 2: And it's hard to know, right because we're only you know,
Speaker 2: halfway through the quarter yet how it's all going to end.
Speaker 2: It could easily swing the other way. But at this
Speaker 2: point for the quarter, at least the five weeks that
Speaker 2: we're into it, the customers are winning, and you know,
Speaker 2: over the long term that's great. We need our customers
Speaker 2: to win. Sometimes they want to win sometimes that's part
Speaker 2: of experiencing the product. So we're really excited though that
Speaker 2: the fundamentals are super strong. We saw three hundred BIPs
Speaker 2: year of year improvement in both promotional and gross margin percentage.
Speaker 2: Cats were down twenty percent in the quarter. Lots of
Speaker 2: really good things going on.
Speaker 1: It's well, there's lots of things, full stop going on.
Speaker 1: Let's get technology in a little bit. But in a
Speaker 1: week where you have a US election and it's getting
Speaker 1: towards the end of the year, the holidays are fast approaching,
Speaker 1: how does sports betting stand out? Like what is the
Speaker 1: consumer attitude towards placing a bet in a week like
Speaker 1: this one?
Speaker 2: Well, obviously a lot of distraction with the election going on,
Speaker 2: but you know, as you might imagine, people were even
Speaker 2: talking about speculating on one side or the other the
Speaker 2: election markets, and that was available in certain places too.
Speaker 2: So you know, I think it's very much part of
Speaker 2: the culture now that people want to be you know,
Speaker 2: a participant by having an idea, a prediction, a viewpoint
Speaker 2: on what they think is going to happen. And I
Speaker 2: think betting is really just you know, part of that
Speaker 2: overall trend.
Speaker 3: Jason, I want to jump in on that polymarket call
Speaker 3: a lot of people's attention.
Speaker 1: Would you go there?
Speaker 3: Would you expand in pass sports?
Speaker 2: Well, we would only do it if it were in
Speaker 2: a legal and regulated fashion. So you know, these types
Speaker 2: of markets on elections are regulated at the federal level.
Speaker 2: It's different than the way betting is regulated. You know,
Speaker 2: it's something that maybe we would you know, consider looking
Speaker 2: into before the next election. But I do think that
Speaker 2: it's only something that we would do in a legal,
Speaker 2: regulated environment, which is what differentiates us from some of
Speaker 2: those that are offering and now some are offering it
Speaker 2: legally now too, there is a legal framework for it
Speaker 2: as well, but not everybody is.
Speaker 3: Let's just talk about therefore that passage of legalization. Is
Speaker 3: that going to be easy are under the next administration?
Speaker 3: I mean also just from the point of sports betting too,
Speaker 3: we see Missouri come in line for example.
Speaker 2: Well, definitely for us, it's really you know, the states
Speaker 2: that are legalizing and so a lot of what we
Speaker 2: were watching were the various outcomes in state houses and
Speaker 2: governors races around the nation. Obviously, you know there is
Speaker 2: some impact from federal federal government impacts every industry in
Speaker 2: some way or another, but you know, taxes other ways,
Speaker 2: corporate taxes, meaning but you know, in terms of legalization,
Speaker 2: our action is really at the state level. So as
Speaker 2: you knowed, Missouri is big win passed about initiative to
Speaker 2: legalize sports betting, and very excited about that. Missouri is
Speaker 2: the eighteenth largest state and a huge sports state. Really
Speaker 2: great sports fans in Missouri, so excited about that one.
Speaker 2: Hopefully that'll get up and running soon, and you know,
Speaker 2: hopefully we'll see even more action when the legislators come
Speaker 2: back in session.
Speaker 1: In Q one, Jason, we focused a lot on this
Speaker 1: program about how sport is access technology, right, a transition
Speaker 1: from linear television to OTT and I'm fascinated by how
Speaker 1: the betting markets either benefit or don't benefit from that. Right.
Speaker 1: The consumer has so many options about how to watch
Speaker 1: sport and pay for it. You know, it's astonishing. Actually
Speaker 1: what flies out of my bank account each month, is
Speaker 1: that a tailwind or a headwind to you when you're
Speaker 1: thinking about bets being placed in parallel.
Speaker 2: Well, I think it's actually a tail in that it's
Speaker 2: part of the overall trend we're seeing, which is sports
Speaker 2: and interest in sports continues to grow, and betting is
Speaker 2: a part of that. They're very intertwined, so I think
Speaker 2: they feed off each other as more and more, you know,
Speaker 2: people can see more and more sports from around the world,
Speaker 2: not just their favorite sports or their favorite teams, but
Speaker 2: they can watch any team or they can watch any sport,
Speaker 2: and that access is there that's going to be a
Speaker 2: benefit to our business. But it's really part of the
Speaker 2: same overall mega trend, which is, you know, information is
Speaker 2: easier to come for the consumer, and the consumer wants
Speaker 2: to be a more active participant because they have more
Speaker 2: information and have a viewpoint on things. And I think
Speaker 2: that's why you're seeing this mega trend around betting that
Speaker 2: continues to grow the overall industry in the US and
Speaker 2: really internationally as well.
Speaker 3: Mega trend that you are going to continue to enhance
Speaker 3: products into. Jason Robbins, we appreciate your time. DraftKings CEO