Fanatics CEO Michael Rubin said in a CNBC interview that he expects sports betting to account for 40% of the company’s profits — or “several hundred million dollars” — by 2027.
Fanatics’ corporate umbrella comprises a sprawling sports apparel and trading card business whose revenue in 2024 grew 15% to $8.1 billion. The company is also the official uniform provider of the National Hockey League. The company has a $31 billion valuation.
But even with its trading card business showing massive growth, Rubin said that Fanatics Sportsbook & Casino is in position to become profitable by 2027 after its 2023 acquisition of PointsBet’s United States assets is off the books. The deal closed last year.
Rubin on making sports betting a larger portion of profits:
“When you take the synergy of the Fanatics ecosystem and what it means to collectibles and what it means to the commerce business and how these things all integrate together, it’s an incredibly big opportunity for us.
“When you think about what gaming can be, in our five-year plan, we have gaming being 40 percent percent of our profits. And we’re very bullish about that.”
Rubin on the PointsBet deal and projections:
“We’ve spent $1.5 billion since we’ve launched, including the M&A deal we did. We’ll lose about $300 million this year. We’ll lose about $150 million next year, and then we’ll make several hundred million dollars in 2027.
“We feel great about that, because if you look at what FanDuel will spend, between M&A, same way we look at it, they spent $6 to $7 billion. Same for Draftkings. So we look at a less than $2 billion spend to get to profitability, versus these guys having a $6-or-$7 billion spend.”
Pursuing DraftKings, FanDuel
The disparate manner in which states report sports betting data makes determining market share difficult nationally. From cobbling together these reports, it is apparent FanDuel and DraftKings have created a duopoly atop the market share heap. Various other sportsbooks perform better or worse depending on the state, but Fanatics, which launched in 2023, has been viewed anecdotally as third nationally and stalking hard.
Rubin’s data confirms that. He was enlightening about the entire state of play in the CNBC interview.
“Yeah, we’re number three,” he said. “FanDuel, DraftKings: absolute leaders. They’ve built incredible businesses. They’re both really well-run. And they each have about 35 percent of the market. We have 8 percent of the market, but we had 4 percent a year ago and zero the year before.”
According to the New York State Gaming Commission, one “whale” bettor might have momentarily bumped Fanatics up to 27.7% market share in August, which would give it second place behind DraftKings.
Fanatics logged $565.8 million of handle in August. That more than doubled its previous monthly best of $207.5 million from March.
In August, Fanatics announced a partnership with Boyd Gaming Corporation for market access in Missouri. In addition to launching a mobile platform, Fanatics Sportsbook is slated to open branded retail sportsbooks at Ameristar Casino Hotel in Kansas City and Ameristar Casino Resort and Spa in St. Charles. Missouri will mark the 24th U.S. jurisdiction for Fanatics Sportsbook.
The research platform Sacra estimated that betting and gaming accounted for 3% of Fanatics’ revenue last year.
