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SportsTranscript
00:00Let's start off with BetMGM as they jockey for that third spot, second spot, first spot in sports betting, their new ideas or maybe old ideas becoming new again for acquiring new customers.
00:14Thanks again. Good to have you here.
00:16Yeah, thanks for having me, Craig.
00:18You know that my favorite time of year is earnings season when we get to kind of pull the curtain back and see what these companies are doing.
00:26And BetMGM is kind of a difficult one to get a read on sometimes.
00:29Remember, they're owned by two separate publicly traded company and neither of those companies have reported their public numbers yet.
00:37So BetMGM in a release yesterday couldn't really say a whole lot.
00:42But what it did say was interesting.
00:44It said that it grew active iGaming customers 18 percent in the second quarter.
00:49It's notable because there was nothing to stimulate that growth.
00:54Right. It was just the second quarter.
00:56There were no new states that came online and that was up from 9 percent growth in the first quarter.
01:01And so that is leading MGM to say, you know, we think we have something going here with these iGaming customers.
01:07We're going to spend more than we thought we were going to to acquire them.
01:12Now, if you remember, Entain and MGM, the two owners, they agreed that they would need to invest a little bit more in BetMGM this year.
01:20Entain had an interim CEO that admitted after the previous CEO was gone that they didn't do the best job at getting American focused products to BetMGM in those early days when grabbing customer share was so important.
01:36And so they're looking at that now.
01:38But interestingly, it said that that the additional investment in customer acquisition was going to be funded by debt.
01:46And that isn't necessarily something I saw coming.
01:49I don't know if anybody saw that coming. Neither company has said how much they've invested in BetMGM this year yet.
01:56But to bring on debt is a little bit out of left wing right now.
02:03We can look at that and say maybe they're preparing to spin BetMGM off into its own company.
02:10BetMGM is getting close to profitability and these digital companies have done pretty well when they've had an IPO.
02:18So that could be something that they're doing.
02:20And you start to play with the balance sheet when you're thinking about that, too.
02:24You know, having some debt is better than having no debt in situations.
02:28And so it could be one of those reasons.
02:31Either way, though, we know that BetMGM is definitely taking the iGaming race seriously in the U.S.
02:37And we know that they want to fight to be top in the U.S.
02:41They were at one point. We just found out today, Craig, a new report from Eilers & Krejcik that DraftKings took the number one iGaming spot in the second quarter.
02:50So BetMGM is still fighting from behind, but they're confident in what they're doing.