888 reports 8% FY2023 revenue dip as ex-Flutter and DraftKings heads join management team
London-listed operator confirms appointments of Rik Barker and Jeffrey Haas as it details medium-term growth plans to deliver “long-term profitability”
888 has reported an 8% year-on-year (YoY) downturn in group revenue for full-year 2023 as the operator announced further plans to develop long-term profitability and changes to its executive team.
The London-listed firm confirmed total group revenue had fallen from £1.85bn in 2022 to £1.7bn in 2023, with the group citing a shift away from dotcom markets which accounted for an £80m revenue drop alone.
Other impacts included “customer mix changes” in the UK on the back of further safer gambling measures, along with a shift in marketing strategy to also focus on more sustainable revenue.
UK online revenue fell 8% from £717m to £658m although there was an uptick in the group’s retail arm with a 3% increase in revenue to £535m.
In the UK online arm, those safer gambling measures resulted in an 18% decrease in average revenue per customer but there was an 11% jump in average monthly actives.
888 said it expects UK online EBITDA to be “significantly higher year over year, despite the reduction in revenue”.
Revenue from the firm’s international operations slipped by 16% from £614m in 2022 to £517m in 2023.
However, 888 noted double digit growth in both Italy and Spain over the course of the 12 months.
Q4 group revenue dipped 7% to £424m, which 888 highlighted as 5% up on Q3 2023. The group also pointed to a 5% YoY jump in actives.
Future outlook
Away from financial performance, 888 provided the market with an outlook update in which it confirmed global cost savings of around £30m were initiated in December.
The group said it also expects compliance and safer gambling impacts to annualise in February, which will result in a more “positive outlook for average revenue per user”.
Other updates include an increase in marketing spend throughout 2024 as well as further investment having been ploughed into “intelligent automation and AI-powered data and insights”.
888 added that these initiatives will enhance long-term profitability but additional investments will see full-year EBITDA land at the lower end of the provided guidance.
The company previously communicated it expected 2023 EBITDA to land between £340m and £397m.
The group has also made a commitment to divulge new medium-term financial and strategic targets which it expects to release on 26 March along with a disclosure of its full year results.
Executive shifts
Elsewhere, 888 confirmed new additions to its management team to complement the recent additions of Per Widerström as CEO and Sean Wilkins as CFO, who will join the firm next month.
Former Flutter Entertainment exec Rik Barker has been appointed as chief information technology officer and will join the business on 5 February.
Barker spent more than five years at Sky Betting and Gaming, eventually becoming CTO, before stepping up to the parent company as chief information officer for the UK and Ireland.
He left Flutter in December 2022 and joined xDesign as COO in February 2023.
Barker will join fellow former Flutter head Ian Gallagher at 888 after he joined the company as chief product officer in December.
Elsewhere, former DraftKings chief international officer Jeffrey Haas has linked up with 888 as chief growth officer.
The former bwin and PokerStars head will return to the frontline of the industry after departing the US giant in May 2022.
888 also confirmed the appointment of Fredrik Ekdahl as group legal counsel after he was hired in October.
Finally, EGR understands that chief commercial officer Phil Walker has decided to leave the business.
Walker had held a series of roles with William Hill, including UK and Ireland MD and online managing director, before being named CCO for the parent company.
Widerström said the business had “enhanced its foundations for sustainable and profitable growth” as he looked ahead to the future.
The CEO said: “I have joined the business at both an exciting and important time. There are clear opportunities to unlock our significant potential, but as a business we know that going forward we must be more proactive in adapting to changes in regulation and technology.
“We are now taking rapid actions to position the group for future success, reducing our overhead costs and freeing up funds to invest in growth based upon our new strategy and value creation plan.
“The financial performance of the group must improve, and the actions we are taking will build a leaner, more agile, and more effective organisation structure, as well as establishing a more effective management of the customer and product lifecycle. These plans support material value creation and significantly higher profits over the coming years,” he added.
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