EGR Power 50 2020: 888 Holdings (9)
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9. 888 Holdings (9)
FINANCIALS: H1 revenue leapt 37% year-on-year to $379m, while adjusted EBITDA of $70.1m was a 56% rise. Casino and poker FTDs up 72% and 103%
STRATEGY & IMPACT: Revamping products to aid cross-sell and UX. In hindsight, the Spectate platform looks a snip for an upfront cost of £15m
GEOGRAPHIC REACH: A firm presence in the US (90% B2C year-on-year growth in H1 in New Jersey). Three-quarters of revenue from regulated and taxed markets
INFLUENCE & LEADERSHIP: Besides switching from chasing VIPs to casuals, 888 has beefed up RG, including a recent ‘Control Centre’ for customers to track their activity
Common sense dictates that a gaming-focused operator like 888 would rush to roll out the welcome mat for players looking for online entertainment during lockdown. But the surprising extent to which the London-listed firm benefited earlier this year was laid bare in its first-half results, as revenue increased by more than a third, buoyed by stellar growth across key verticals, with casino and poker up 48% and 56% respectively as FTDs flocked in their droves and lapsed players returned.
The better-than-expected results in H1 were followed by impressive average daily revenue growth of 56% in Q3, which comfortably outstripped notable positive performances in the quarter from rivals like GVC (+26%), Gamesys (+31%), Betsson (+27%) and Kindred Group (+24%). The standout first nine months are reflected in the fact 888’s share price is up more than 60% this past year, yet the company was laying the groundwork prior to coronavirus that enabled it to excel amid 2020’s unusual circumstances.
For instance, 888’s Orbit casino platform, which harnesses AI to power personalisation, is delivering tangible results, while there was the global rollout following a soft launch of the long-awaited Poker8 platform with its enhanced UX, particularly on mobile with the popular portrait mode among a clutch of new features. In an ideal world, this upgrade targeting recreational players would have come earlier this year when online poker experienced a renaissance. But better late than never, we say, for a product that was two years in development.
Meanwhile, there was the successful rollout in Sweden of the new Spectate sports betting platform built from the £15m acquisition of Ireland’s BetBright and its proprietary tech in 2019. Spectate is due to launch in the UK by the end of the year, followed by the US some time in H1 2021. 888sport is currently powered by Kambi, so the ability to take control of its product roadmap and differentiate the offering from its rivals should be a competitive advantage.
Spectate also has the potential to increase sport betting’s share of the business (16% for FY 2019) and create a more evenly balanced product portfolio that is still dominated by casino. Moreover, the major product upgrades to its main verticals, combined with the performance momentum achieved in 2020, certainly make 888 an interesting one to keep an eye on in 2021.