Flutter Entertainment, the world's largest online betting company, along with Fox Corporation, has recently announced the closure of FOX Bet, a U.S. sports betting platform. This decision comes as part of Flutter's strategic efforts to return to profitability in 2023 after incurring a loss of $313 million in the United States in 2022.
Flutter & Fox Close Struggling FOX Bet App & Online Sportsbook
- Flutter and Fox Corporation to shut down FOX Bet, a U.S. sports betting platform, as Flutter targets profitability in 2023.
- FOX Bet contributed less than 3% to Flutter's $3.3B U.S. revenue in 2022. Closure aligns with Flutter's strategic moves in the evolving U.S. gambling market.
- Pennsylvania betting users of FOX Bet have plenty of excellent sports betting options in the state should they needs a new sportsbook.
Details on the FOX Bet Closure
The phased closure of FOX Bet's operations is set to take place from July 31st to August 31st, 2023. While the shutdown of FOX Bet signifies an end to this particular venture, Flutter retains future access to the FOX and FOX Bet brands.
FOX Bet's role within Flutter's U.S. operations has been relatively modest, contributing less than 3% to the company's total U.S. revenue of $3.3 billion in the previous year. Flutter Entertainment, recognized for its ownership of the prominent U.S. sports betting market leader, FanDuel, has been strategically positioning itself to navigate the evolving landscape of the U.S. gambling market.
The Decision to Close FOX Bet
The decision to shutter FOX Bet is part of Flutter's broader efforts to bolster its financial performance in the American market. The company's aspiration to return to profitability in 2023 aligns with its intention to become the first sports betting operator in the U.S. to achieve profitability since the federal ban on sports betting was lifted in 2018.
Notably, FOX Bet's financial contribution to Flutter's loss was significant, accounting for $91 million. This figure highlights the financial impact of the platform's underperformance on Flutter's overall balance sheet.
In light of FOX Bet's closure, Flutter's CEO, Peter Jackson, expressed his optimism that a substantial portion of this loss would be mitigated. He estimated that "between half and two-thirds of that [loss] to go away" following FOX Bet's cessation of operations.
Flutter and FOX Relationship Moving Forward?
FOX Corporation's involvement in the venture remains noteworthy. Despite the closure of FOX Bet, FOX will retain its 2.5% stake in Flutter. Moreover, FOX Corporation will maintain its option to acquire an 18.6% stake in FanDuel, a clear indication of the company's continued interest in the burgeoning U.S. sports betting market.
FOX Bet's inception was a result of a partnership between FOX Corporation and The Stars Group (TSG) in 2019. This collaboration marked an ambitious foray into the world of online sports betting. Subsequently, Flutter Entertainment acquired The Stars Group later that same year, consolidating its position within the global gambling industry.
FOX Bet Effect on PA Market
Looking at the May Pennsylvania Sports Betting Financial Report it shows that Mount Airy Casino only had a $297,486 online revenue, putting towards the lower half of P.A. casino sports betting operators. This is likely to have minimal effect on the P.A. betting revenue in total, as it only made up .008% of the total online revenue in the most recently released financial report.
How FOX Bet Started
Notably, FOX Bet's operations were situated within the evolving framework of U.S. gambling laws. Since the overturning of the federal ban on sports betting in 2018, individual states have been granted the autonomy to legalize and regulate sports betting within their borders.
This has led to a patchwork of regulations and licensing frameworks, with different states adopting varying approaches. FOX Bet's operations were legal in states that had legalized sports betting, demonstrating the complex interplay between state regulations, technological platforms, and corporate partnerships.
Prior to its closure, FOX Bet established its presence in the legal sports betting landscape of the U.S., operating in states such as Colorado, New Jersey, Pennsylvania, and Michigan. This strategic expansion aligned with the evolving regulatory framework, enabling FOX Bet to offer its sports betting platform to enthusiastic bettors in these states.
Now PA bettors and those in the other listed states will have to look elsewhere. The good news is each of those states have multiple reputable sportsbooks available.
Flutters U.S. Plans for Profit
The closure of FOX Bet represents a strategic move by Flutter Entertainment to enhance its financial performance in the U.S. gambling market. The decision to discontinue FOX Bet's operations comes as the company aims to return to profitability in 2023, marking a potential milestone in the industry since the legalization of sports betting.
The evolving U.S. regulatory landscape, coupled with corporate partnerships and strategic decisions, continues to shape the trajectory of the online gambling sector in the country. As Flutter Entertainment recalibrates its U.S. operations, the industry anticipates further developments that will influence the broader landscape of online sports betting and gambling.
A huge sports fan; locally, many know me as the guy who does the PA for our high school football team on Friday nights. Having grown up in Michigan, I am a sports fan of all the Detroit teams, and at the college level, I love Michigan State sports. I have covered sports betting, iGaming and casino industry news for many well known websites.