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SportsTranscript
00:00What's really fascinating to me is seeing all these reports, Matt, state by state, that
00:08a lot of the numbers are down in sports wagering this summer.
00:11I don't know why this should come as any surprise.
00:13I mean, the primary sport, of course, is football, the secondary sport is basketball and maybe
00:18hockey and some others.
00:19I mean, is it simply the reason why DraftKings estimates are down as well?
00:24I mean, this isn't really time to panic in the summer, is it?
00:28No.
00:29I think when we reported on a note from Deutsche Bank on DraftKings, they lowered EBITDA estimates
00:35for the second quarter.
00:37A lot of that is coming from the increased Illinois tax, Craig.
00:42There's a lot of flow through from that.
00:44The other part of it is that they think maybe the hold is going to be down and that DraftKings
00:49just got beat again.
00:51Now remember, DraftKings is saying they expect a structural hold of 10.5% for the full year
00:58and that's because they're baking in all of these advantages from the parlays, the same
01:02game parlays, all these products that they're pushing that give them better margins.
01:08But yeah, so it's interesting.
01:10The other thing about being worried about the handle dropping in the States, Craig,
01:14is with these states, we have, what, maybe 13 US jurisdictions left that can really legalize
01:22sports betting.
01:23And with them now not picking up at the same clip that we saw, we want to see these older
01:29states still growing what they're doing for a DraftKings and a FanDuel and the players
01:35that have been in the market for a while.
01:37And DraftKings has proven that they've done that.
01:40So I certainly think that's going to be something that DraftKings hits hard in their upcoming
01:44earnings call at the beginning of August.
01:46I think they're going to want to point out that they still have these legacy states that
01:50are doing well and they're going to try to tell everybody that they're mitigating these
01:54tax revenue increases as well as they can.