PointsBet Puts US Operations Up For Sale As Struggles Continue
PointsBet Sportsbook is calling it quits in the U.S. sports betting industry. The sports betting operator has officially hired investment bank Moelis & Company in hopes to facilitate a sale of its North American operations. PointsBet is an Australian-based operator that launched its product in 14 U.S. markets. The company struggled to gain large market share in any of its markets.
PointsBet Throwing In The Towel
This announcement that PointsBet Sportsbook is selling its U.S. position is not out of left field. The company has been vocal about its many struggles and has begun scaling back in its expansion. PointsBet initially was aiming to launch in Massachusetts but withdrew its application before the launch.
“We would like to thank the Massachusetts Gaming Commission for their consideration of our application, conducting extensive hearings, and deeming PointsBet suitable for licensure ahead of the launch of legalized sports wagering in the commonwealth of Massachusetts,” said a spokesperson to MassLive.
PointsBet stated that the reasoning behind pulling the application was to “emphasize our continued focus on our 14 live states of the US (plus Ontario) and how we can best optimize those markets which provide an immense [total addressable market] for us to go after.”
The sports betting entity struggled in the U.S. to compete with other larger entities such as FanDuel and DraftKings. PointsBet attempted to sell its Australian operations in 2022 in an effort to consolidate focus and increase the company’s profitability.
While a sale to Betr nearly went through, PointsBet ultimately backed out of the deal deeming it too low. Now the company is aiming to offload its North American operations.
“We believe further industry consolidation is inevitable,” said a PointsBet spokesman to The Australian Financial Review. “We’ll position PointsBet to take advantage of movement in the sector.”
PointsBet Holds Value For Potential Suitors
Despite their struggles, PointsBet still stands as the seventh-largest sports betting company in North America. The company’s most recent fiscal report showed that H1 FY 2023 saw growth in the company. This accounts for the six-month window ending on December 31, 2022.
The H1 FY 2023 results show the company saw a 66% increase in betting activity year over year with $1.1 billion in sports betting handle. PointsBet’s total handle during that stretch was $2.2 billion with the inclusion of iGaming. The company saw an increase of 28% year over year in revenue as well with $120 million.
Cost-saving measures that PointsBet has implemented have led to this growth in profitability. This will likely appease a potential buyer in the market.