In July of 2018, The Stars Group acquired the Sky Betting & Gaming (SBG) group. Predictions for the months proceeding this were very much positive, and the brand has now published its first quarterly results. These pretty much echo the predictions, showing that the acquisition of those businesses was definitely a great move.
Prior to July, most of the revenue for The Stars Group came from online poker, standing at 63%. Casino gaming followed on with 28%, while sports betting only stood at 5% of the total revenue. With the addition of the SBG businesses, as well as BetEasy, income figures have altered fairly dramatically.
Online poker still leads the way, although this has seen a drop to 36%. Casino gaming has remained the same, while sports betting has boosted up its share of the revenue to 32%. Stars Group has gone from strength to strength over the years, now holding a market cap that is upwards of $5 billion. This has been primarily thanks to the involvement of the PokerStars platform – the company’s biggest site over the years.
While poker is still the primary factor for the brand, it has quite the competition from the sports betting side of things. CFO of the company, Brian Kyle spoke highly of the revenue split, now referring to PokerStars as “a large and low-cost” acquisition channel for customers.
What Does the Future Hold?
Speaking to investors, the CFO said that he believes online poker will continue to grow, even though the revenue for the third quarter of 2018 fell, as far as PokerStars is concerned. The 4% year-on-year fall though, is not something that should be too concerning, as it still saw the brand draw in $221.8 million in total.
For the last three years, the PokerStars brand has spent its time chasing after recreational players, choosing to clamp down on the usage of third-party software in the process. Not only that, but the site’s VIP program now focuses its rewards on the casual player, rather than just those who play on a more professional level.
However, The Stars Group now turns its attention to the sports betting sector of the United States of America. This looks as though it will be the best market to turn to for further expanding the company. The CEO of the company, Rafi Ashkenazi, spoke of the strategy for the brand going forward, which is decidedly different to several other competitors in the field.
For the time being, a deal has not been signed by PokerStars that will see it enter into the sports betting market. While it does have a certain entry point in Pennsylvania with Mount Airy Casino, it doesn’t reach any further outside of the borders of New Jersey for now.