Sportsbet revenue drops $90 million as racing decline bites

Market leader Sportsbet continues to be impacted by headwinds in the Australian wagering market, with its revenue over the first three months of 2025 down 18 per cent year-on-year.

Releasing its quarterly update on Thursday, Flutter, Sportsbet’s parent company, revealed its Australian revenue for the first quarter of 2025 was $US271 million. That is $US58 million ($A90 million) less than the first three months of 2024.

Reflective of the overall challenges within the Australian wagering industry, Sportsbet, which holds around 45 per cent of market share, reported $US351 million of revenue across the same period in 2023, and has now reverted to its lowest first-quarter revenue in five years.

The dip was attributed to the “racing industry’s structural challenges” and adverse sports results.

“We have been able to partly offset our adverse racing handle trends by expanding our sports structural gross win margin through ongoing product-led improvements such as “The Feed” feature, which helped drive parlay penetration, alongside improved customer generosity sophistication,” Flutter chief executive Peter Jackson told shareholders.

The quarterly report said it expects that a softer racing market is expected to continue in the near term, but that the sports segment of the market continues to show growth.

The size of, and the reason for the decline, is likely to be a reality check for Australian racing authorities, given Sportsbet’s dominant position in the market. 

It comes after global competitor Entain announced last week that its Australian revenue, across the first quarter of the year, derived through its Ladbrokes and Neds brands, had dropped 8 per cent.

The declining Australian revenue barely caused a ripple in an otherwise fairly positive set of results for Flutter, which saw its global revenue jump to $3.67 billion compared to $US3.4 billion for the same time last year.

In the same quarter of 2021, Sportsbet made up 18.8 per cent of Flutter’s global revenue, but in 2025 this has slipped to 7.4 per cent. In four years, the Australian arm’s first quarter revenue has actually declined from $US279 million to $US271 million, something Flutter also attributes to the impacts of greater taxation and regulation in a more mature Australian market,.   

In comparison, the overall Flutter first quarter revenue has jumped from $US1.49 billion in 2021 to $US3.76 billion in 2025, although this was short of Wall Street projections, something attributable, again, to sports results.

The American market, underpinned by its FanDuel brand, has driven much of that growth, with revenue of $US1.67 billion across the first three months of 2025. Average monthly players in the American market grew by 11 per cent to more than 4.3 million.

“I continue to be really pleased with how the scaling of our US business is driving a step change in the earnings profile of the group,” Jackson said.

“Our international business is also demonstrating the benefits of scale and diversification with particularly strong performances in SEA and India. These factors combine to drive year-over-year net income and adjusted EBITDA growth of 289 per cent and 20 per cent respectively in Q1.”

Jackson said that despite global uncertainty, including a turbulent first three months for the Trump presidency, plus other challenges, he backs the resilience of the Flutter business.

“The global regulated market opportunity is significant and growing, and Flutter is uniquely positioned to win,” he said.