Hit by Dutch exit

888 sees 18% revenue decline in Q1 amid North American expansion, appoints new US President

Howard Mittman, Group’s new President 888 US.
2022-04-20
Reading time 3:58 min

888 Holdings announced Wednesday the release of its financial report for its B2C and B2B operations in Q1, 2022, which have suffered a substantial revenue decline of 18%  in a year-over-year comparison,  reflecting the temporary exit from the Netherlands, and lower revenue per active driven by the "heightened focus on safer gambling." However, revenue was up 1% compared to Q4 2021, driven by average monthly actives growth of 4%. These numbers were released a day after the appointment of Howard Mittman as the Group’s new President 888 US. 

The company’s numbers plummeted to $224 million from $273 million in 2021, a percentage decline which was mirrored by its B2C earnings, which fell from $263 million to $215 million. 

A breakdown of B2C performance saw betting revenue decline by 42%, attributed to a 28% decline in stakes as well, increased promotion, customer wins and the closure of its Netherlands business in the latter half of 2021 for regulatory reasons. 

However, it was underscored that the company’s betting revenue increased 19% compared to Q4 2021, which is described as “a period which saw unusually low win margins”, whilst moving forward, CEO Itai Pazner highlighted on 888’s US investments and the acquisition of William Hill raised gross proceeds of stand at $212.8 million. 

During the first quarter of 2022, the company also launched in two North American jurisdictions including Michigan and the new Ontario iGaming and sports betting market. According to Pazner, the next step is to go live in Virginia in May

“Having revised the transaction terms for William Hill and completed an equity placing to part-fund the deal, we are on track to complete in June and continue to execute our plan to build a global online betting and gaming leader”, Pazner stated.

888 also experienced a drop-off in casino earnings, which fell by 14% year-over-year from $221 million to $191 million, whilst the B2B division also experienced a revenue drop-off of 6% to $215 million, compared to 2021 when the company harvested $263 million.  

However, 888’s Q1 revenues show an increase in contrast with Q4 earnings, as betting income increased by 19% quarter-to-quarter and B2B revenue also saw an uptick of 1%. Although casino revenue also fell between the two periods by 1%.  

The group also highlighted its performance in key regulated markets such as the US, Romania and Portugal, where the company experienced revenue growth along with year-over-year gains in Italy, which provided a bulwark against a decline in its UK earnings. 

Outside of Europe, the firm completed an investment in 888AFRICA to bolster its position in a long-term investment market. 

Alongside these important strategic milestones, Q1 2022 revenue was slightly ahead of Q4, 2021. “I am pleased with the group’s progress and we are looking forward to returning to year-over-year revenue growth in the second half of the year, as we benefit from further launches in additional US states, together with our expectation of relaunching in the Netherlands and ramping up our recent launch in Ontario”, the CEO said. 

Strategic appointment

In North America, as the company begins its operations in Ontario and Michigan, and prepares to launch in Virginia, 888 has appointed Howard Mittman as its President of its US division. The brand stated in an official press release Tuesday that Mittman has over 20 years’ experience in the digital and media industries. 

Mittman will be responsible for 888’s US operations, including its strategic partnership with Authentic Brands Group (ABG) a brand development, marketing and entertainment company and owner of the Sports Illustrated (SI) brand. He will also be responsible for 888’s B2B partnerships in the US, including the World Series of Poker (WSOP) brand’s online poker rooms across three states, with more in the pipeline including in Michigan. Together, 888 and WSOP host the US market’s only regulated inter-state online poker network.

Most recently, Mittman served as the CEO of Bleacher Report, a leading digital sports brand, having previously been Chief Marketing and Revenue Officer at the company. During his career he also held leadership roles including Chief Business Officer of Conde Nast, and Publisher and Chief Revenue Officer of WIRED and GQ. 

"This key appointment comes at a hugely exciting point in our long-term growth strategy in the U.S. online betting market as we look forward to launching SI Sportsbook in multiple states in the coming months and years," Chief Executive Itai Pazner said.

Mittman commented: “I am thrilled to be joining one of the online betting industry’s most respected and successful businesses. 888 has an outstanding reputation for innovation, product leadership, and customer-centricity. I have been hugely impressed by the people I’ve met within the business, particularly their passion for product and the customer experience, and I share their excitement about the significant opportunities ahead. The partnership with ABG and Sports Illustrated gives us a unique opportunity to deliver world-class betting and gaming products as part of a fully integrated experience with a leading sports media brand.”

Daniel W. Dienst, Executive Vice Chairman at ABG commented: “We applaud 888’s decision to appoint Mr. Mittman as President 888 US of its growing US platform and the operators of SI Sportsbook. With the breadth of his media industry experience and 888’s technical capabilities, we are excited to further capitalize on the opportunity to build a differentiated wagering experience for the loyal and avid fans of sports – and in
particular, Sports Illustrated - who since 1954 continue to trust and rely on its peerless journalism and visit the platform in record numbers monthly.”

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