Supergroup announces exit of U.S. sportsbook market to focus on iGame
The parent company of Betway and Spin, Supergroup Limited, announced a strategic change after an in-depth internal review. The company plans to exit the U.S. sportsbook market, ending operations in nine currently active states. Despite the exit, Supergroup will continue to have a strong i-gaming presence in the U.S., particularly through its spin portfolios, including New Jersey and Pennsylvania’s Jackpot City.
Strategic Review and Decision:
CEO Neil Menachet explained the rationale for the decision, saying, “As a global business, we continue to evaluate the optimal use of resources in every market we operate in. We recently completed an extensive review of our U.S. operations and do not currently see a long-term path to the profitability of our sportsbook products.”
The supergroup’s strategy will now focus on iGaming, where the company has made up the majority of revenue. According to a report from BusinessWire, Menachet added, “The majority of supergroup revenue comes from iGaming, and we will continue to provide leading casino products in New Jersey and Pennsylvania under that strategy. We can expand our U.S. footprint when appropriate investments or strategic opportunities arise.”
The supergroup is expected to incur expenses related to closing U.S. sportsbook operations, with details to be provided at its next quarterly earnings call in early August. These costs are significant but are not expected to affect the company’s capital allocation or overall operational plans. Non-U.S. earnings, which have historically been strong, will not be affected by these strategic changes. 바카라사이트
Betway’s current position and challenges:
Betway, a sportsbook brand under the supergroup, currently operates mobile sports betting in nine states. Despite its presence, the company is struggling to gain significant market share. In Arizona, where Betway launched in February 2022, for example, the company’s cumulative transaction amounted to $25.6 million, less than 0.2% of the $14.8 billion bet made through the in-state sports betting app. This limited success is repeated in other states, with holdings and gross returns varying.
Betway’s promotional spending has had a noticeable impact on total revenue in states where promotional revenue is tracked. In Arizona, for example, 9% of this year’s holdings have been offset by promotional bonuses and credits totaling $437,936, or 66% of the $662,500 jackpot. Similarly, in Ohio, they accounted for nearly 66% of the annual $365,900 in revenue, even though promotional spending is not deducted.
Despite the planned sportsbook exit, Supergroup remains open to future opportunities in the U.S. market. The company will focus on strengthening its iGaming brands Spin and Jackpot Cities in New Jersey and Pennsylvania, driving growth and profitability.
Industry Responses and Market Movements:
The supergroup’s decision received a wide range of responses within the industry, according to SportsHandle. As of 11:15 a.m. ET on the day of the announcement, the company’s shares were trading at $3.16 on the New York Stock Exchange, little changed from its initial price of $3.17. This stability suggests investor confidence in the company’s strategic pivot toward iGaming.
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