iGaming Daily

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H1 financial reports continue to flood in as BetMGM becomes the latest operator to release its performance in the first half of 2024. Reporting a strong H1 2024, BetMGM revealed that net revenue from its operations reached $1 billion, which the firm's CEO Adam Greenblatt stated was laying the groundwork for BetMGM's future. This will be the discussion for the first half of today's iGaming Daily, supported by OptiMove. Then in the second half, we'll be heading over to Middle Earth. or more specifically, New Zealand, as news broke this morning surrounding its gambling regulation future. And joining me to discuss these two topics is Connor Porter, the senior journalist at Casino Beats. How you doing, Connor, you okay? Yeah, not too bad, James, not too bad. Interesting start to the day with the New Zealand news that we'll get onto later. And of course, the BMGM financial report that came in yesterday, interesting information come from that too. So yeah, doing all right, doing all right, James. How are you doing, James? I'm doing really well. I am doing really well considering, I don't really like talking about weather at the start of a podcast because I feel like it's a bit cliche, but when you're from Manchester and the sun seems to be shining, as you can see on the video right here, it is coming through the windows. So I'm actually enjoying the heat for once, which is nice. Well, I say that, but I'm stuck in an office right now. Yeah, you're stuck in an office and you know, whilst the weather is nice and bright, we're all inside with the air con. going, keeping ourselves cool. Although you're at home, probably in your brick house, which are absolutely horrible for warm weather. So you know. We've ticked off the cliche talking about weather at the beginning of the podcast. And we've also ticked off the cliche of the typical British moaning about warm weather. So yeah, we're all good to go on this podcast for certain. Yeah, I did have the fun on. literally blasting in my face, which is, it's just there. But I turned it off before our producer, and A, shouted at me for having it on. So if I start sweating halfway through this podcast, now you know why. But before we start the podcast, it's now time to mention the supporter of our podcast, another sunshine company, and that is Optimove, the number one CRM marketing solution for the iGaming market. And the offer still stands where Customers can get a free first month with OptiMove by clicking on the link in the description below, or you can just search www.optimove.com forward slash SBC. Now, we've already mentioned we're gonna jump into BetMGM in the first half of the show. So Connor, you were covering this for Casino Beats. Do you wanna just provide us with a overview of BetMGM's H1 performances, highlight some key highlights from their report? So yeah, BetMGM, Operator jointly owned by Entain and MGM Resorts International. As you mentioned, their net revenue came in for the half year at a billion dollars for the first half of the year, up 6% year over year. Q2 net revenue up 9% year over year and 3% quarter over quarter. And then a bit more specific into the verticals itself. iGaming average monthly actives up. 18% year over year, despite the fact that there was no new state launches, up 9% quarter over quarter. And then for online sports betting, NGR per active up 16% year over year. So in my opinion, some strong numbers there. And it's been a consistent emphasis from MGM since December last year when they mentioned that 2024 would be... an investment year. They laid down the expectation as well about their EBITDA, which they said is consistent with their expectations from their statement made in December, supporting customer acquisition and enhanced player experience initiatives. It's on track for them at the moment with their expectations, but it is a minus 123 million, which we'll talk about more later on when we discuss more about their EBITDA. But they said it's encouraging online sports books, CPAs of FTDs driven by a successful Super Bowl campaign. So we'll talk more about the iGaming and sports book and marketing partnerships later on in the podcast. But as you mentioned, Greenblatt said, Adam Greenblatt, that is the CEO. said that the first half of this year has been very important in laying the groundwork for BetMGM's future. 2024 is a year of investment focusing on improving our customer experience and stepping up our level of investment in players. We are encouraged to see this strategy delivering, accelerating momentum. They said as well, we have exceeded our goals for both acquisition and retention, which should lead to higher year-over-year revenue growth for the second half. of this year into 2025. So yeah, overall strong, decent headline figures there, but there has been a bit of a mixed reaction to these results from the wider investors into BetMGM as well. What was the success attributed to and who are Angstrom and what part did they play in the B.E.M.G.M.'s first year of 2024? Yeah, so B.E.M.G.M., when they talked about their successes, they highlighted the iGaming achievements, the enhancements to the sports product and technology, as well as their marketing partnerships that they've done throughout the first half of 2024. Specifically, what you mentioned with Angstrom Sports, there are a specialist provider of next generation sports modeling, forecasting and data analytics for US sports covering Major League Baseball, the NBA, NFL, NHL, and college basketball and college football. They were acquired by Entain in July last year. What they do is they are enhancing the Parlay and in-play wagering for US sports betting. It's having that kind of positive effect since they began integrating Antrim Sports statistics and data into their offering over the past year, which they've further integrated into for Major League Baseball and at the back end of the NBA seasons provided by fully in-house single game parlay and single game parlay plus products. Player experiences also improved with enhanced betting and single game parlay plus journeys. Essentially improving the customer experience with this angstrom sports integration into their offering there. With Anxious Straughts, they are hoping that the capabilities will be fully integrated across Major League Baseball, NBA, and the NFL ahead of the NFL season coming up, which begins in September. They're hoping that's on track for that integration there. Elsewhere in iGaming, they mentioned about a largest ever regulated US online jackpot over $5 million in New Jersey. They also mentioned that several launches took place, including exclusive games and reward mechanics with suppliers such as GameCode and WhiteHat Gaming, as well as the launch of MGM Arcade, which is a non-traditional content platform for games such as Lucky Tap and Crash Style Games as well. Specifically on iGaming, Greenblatt said, with attractive returns and to maximise this strength and momentum we plan to deploy additional marketing in the back half of this year. So it sounds like the MGM has got some eye-gaming marketing plans for the second half of this year. But looking back at some of the marketing partnerships that they did have in the first half of the year, we already mentioned about the Super Bowl campaign, which included a city-wide takeover of Las Vegas, which was where the Super Bowl was being held, and also a commercial that I had featuring... NFL icon Tom Brady, NHL legend Wayne Gretzky, and the actor Vince Vaughn as well. Quite a recognizable campaign. Also, they add partnerships with the likes of X and the Associated Press. That's helped them widen their reach as well, in hopes of acquiring more customers and retaining customers too. Yeah, a couple of reasons behind their successes there. with the marketing partnerships, with the Anxium Sports integration, and with other sports products and technologies, and of course the iGame achievements listed as well. Perfect, and you mentioned earlier about the MGM's EBITDA targets for 2026. Are they still on track, and what do the firm need to do now to kind of secure those targets? This is where some investors have expressed a little bit of disappointment because the verbiage has slightly changed from when BEMGM initially announced their projection in December last year. They initially said that they were aiming for a positive adjusted EBITDA projection for 2026 of $500 million, to now they've said that they are looking for a $500 million EBITDA. in the coming years. It's a slight change in Furbius, which still could technically mean 2026, but according to the daily emails that are produced by our good friends from earnings plus more, they've received some investor's feedback and they've expressed some disappointments. Within the MGM's financial report, they stated, near the end of it. They said, investment in our execution roadmap, accelerating momentum and opportunities ahead all support our confidence in the MGM's pathway to $500 million EBITDA in the coming years. That's how it reads in the full sentence, which you still could infer it means 2026, but some interpretations have gone a different way. For looking ahead for the next half of 2024, they're still forecasting... EBITDA to be similar to what it was in the first half of the year. So, in the minus, I think if I'm just remembering correctly, we did read out the figure just a moment ago. So I'm just reminding myself what the figure was. I think it was a minus 123 million, yes. So roughly in the, we would probably say it's going to be roughly in the minus 250 mark for the full year. But MGM said that the expectation of greater than planned market investment in iGaming is having an effect on this EBITDA in H2, with the additional investment expected to be funded by bank debt. So that's how they've got to the negative EBITDA fold, remained a part of the year. But from their perspective, they'll say that they're still on their planned trajectory of positive EBITDA in the close to $500 million mark by 2026, but some have been interpreted as potentially being flexed out a little bit because of the in the coming years mark. We may get extra clarity on – I mean, why not? More vegetables help us see in the dark and all that good stuff. We may get extra clarity. on the situation when MGM Resorts release their quarter reports later this week on July 31st in the US. They'll be covered on August 1st on Casino Beats the following day. But then also Entain have their upcoming financial report coming out on August 8th. So we may get extra clarity on the situation of MGM in those reports, but it's not a guarantee that will be the case. It may just be a situation of wait and see how this progresses throughout the rest of 2024 Mm-hmm and for those who are waiting and seeing just keep your eyes peeled on casino beats cause Connor and his Team will be covering it as and when it breaks But apart from that we're gonna take a quick ad break and then when we return We're gonna be heading to the Shire to meet Frodo as we talk all things New Zealand Welcome back And as promised in just for the outbreak, we are in New Zealand as there's been a update this morning regarding the country's regulations when it comes to gambling. Connor, I'm going to ask you to just give us an overview of what's happening, because it's a story that you broke this morning. Yes, New Zealand government has announced plans to regulate online casinos with the new regulatory system plan to be in place. From early 2026, the Minister of Internal Affairs, Brooke Van Velden, has said in a statement on the government's website that a high-level approach to on-laccino regulation has been agreed to by the government, designed to minimise harm, support tax collection and provide consumer protections to New Zealanders. Van Velden said in a quote that there will be a licensing system for unlicensed operators to offer services to New Zealanders. Licensing is how we regulate most forms of gambling domestically. This is not intended to increase the amount of gambling New Zealanders do, but to ensure operators meet requirements for consumer protection and harm minimisation as well as paying tax. So those are the three key points as to why they have plans to introduce online casino regulation in New Zealand to minimise harm, support tax collection and provide consumer protections to the public. So that's why they've taken this direction with this announcement today. government for New Zealand, they've taken over, well, the national party claimed victory in last year's election when they beat the Labour Party, which was, which seemed to be a shock at the time, but this is kind of the first gambling change that the country has seen since this new government has taken over, which is interesting. Definitely when you consider ahead of the elections last year, the two parties, they clashed over the subject of offshore gambling revenues, which... I think the national said that it could raise 179 million New Zealand dollars per year from offshore operators. There was a lot of back and forths around it and there's some interesting articles out there but to have this change, well this potential change to the gambling regulations focusing on like, you know, interesting step forward. It seems very strict on the face of it. Just looking at some of the restrictions and that's from kind of advertising. Again, it's just. Online casino only. There's a strict limit on advertising for licenses, which will be permitted. A casino must be fenced off from other gambling products and sports betting and lottery must not be offered alongside casino. Interesting. What's the response been though from this announcement Connor? Yeah, just to double down what you said about the offshore as well, this is common in a lot of markets around the globe, combating offshore gambling. It's a heavy influence of that direction, of that challenge in the U.S. We've seen it across Europe as well. It's not surprising that New Zealand is looking to regulate on La Casino in order to try and limit the impact of offshore. offshore gambling and try and get some of that money back through tax, through regulation. So, yeah, as you mentioned, you know, only a limited number of licenses to be handed out in an auction, each lasting three years, beginning conditional on meeting, being conditional on meeting regulatory requirements, only prohibited for those over 18, operators only be able to offer online casino games, as you said, not sports with lottery. licensed gambling operators will be allowed to advertise, which previously advertising by licensed gambling operators had been prohibited. But there will be strict limits in place for this advertising, and online casinos can't get involved in sponsorship. That still remains illegal in that sense. I'll get onto the reaction in just a moment, James. I know that's what you're pressing for. One last quote from Van Veldin. She said, I expect the new regulatory system to be in place from early 2026 and the public will have the opportunity to provide feedback during the select committee process. Once established, the Department of International Affairs will be the regulator. So that's another important point. The Internal Affairs Department will be the regulator of the online casino market there in New Zealand. But yeah, in terms of reaction, Sky City Entertainment Group has reacted to this. They've shown their support for online casino regulation, saying in a statement, the Sky City Entertainment Group remains supportive of the regulation of online casino gaming in New Zealand with emphasis on strong host responsibility and delivering community benefits in New Zealand. Also, their CEO, Jason Walbridge, has posted on LinkedIn as well. on the regulation of online casino gambling in New Zealand. Sky City has a long supported regulating online play to minimise harm and protect Kiwis. Limiting advertising and the number of operators in New Zealand is a good way of doing this. Currently there is a lot of money going offshore that should be staying in New Zealand as tax and community benefits. We hope this will be a key part of any future framework. So yeah, again, the... industry has seen that. The industry has reacted, well, just from this one reaction, shall we say, from Sky City Entertainment, that a step in the right direction is the step towards regulating online casinos. They're happy with the direction that the government is taking now. They've only provided limited details on the online casino regulation as of the moment, but the government did say in their statement that further details. on the online casino regulation will be released later this year as well. So we'll wait for that. So those details to be released. And that's not like a broken record, but Connor is going to be all over those updates because I imagine the next 12 or 24 months will be, there'll be quite a few updates coming from New Zealand and keep an eye on that for casino beats. Do you think it's a bit too early to predict a casino beat summit? New Zealand, Connor? I'm not too sure. You know, maybe in a couple of years time, who knows? But yeah, yeah. I would love to go to New Zealand one day. So yeah, why not? Definitely. We'll do the, we'll go visit the Shire, shall we? When we're there as well. Perfect. Right, we'll round off the podcast. Connor, thank you for joining us today. I've been your host, James Ross, and this has been iGaming Daily. For any further information from the topics that we discussed today, click on the links in the description below. But apart from that, thank you and goodbye.