Betfair results send share price rocketing
Betfair announced a glowing set of results this morning: –
https://corporate.betfair.com/media/press-releases/2015/05-03-2015.aspx
Since Breon Corcoran came to power we have seen a shift from the exchange very much to the sportsbook on Betfair and it seems to be working, for them. I haven’t seen any advertising for the exchange for probably two years now. The rationale for this is that it’s easier to get customers onto the sportbook. Number of active customers are up 35% to 760,000, so that is true!
Revenue from sports rose £10m to £76.7m but as the exchange and sportsbook are merged, so it’s impossible to figure out exactly how that was achieved. In the absence of any mention of the exchange we have to assume that growth was driven from the sportsbook. Sometimes not saying something actually says something.
Interestingly, Gaming is up from £24.1 from £18.5m, 30%. Gaming is riskless activity like Casino and games where the house always wins. It’s amazing to see people waste their times on such activity. If I want to lose money to the house I would rather have a drink at a Casino and enjoy it rather than prod an icon on a screen. But whatever floats your boat I guess.
I don’t begrudge Betfair’s management for focusing on soft revenues rather than the harder sell of the exchange. That is their obligation to shareholders. But the exchange was why I joined Betfair in the first place, that chance (comfortably achieved) to make a life changing amount of money by actually finding an exploitable edge in the market. You simply can’t do that on a sportsbook or with a bookie.
It’s more frustrating I think, that people can’t seem to grasp a simple concept. With a traditional bookie nobody wins money long term, nobody. On an exchange a fee is charge for matching backers and layers and the profit is split between the exchange and winners. That’s such a neat model, an industry changing concept.
Unfortunately that concept is no longer being explained and good old apathy is ensuring it no longer gains traction. I mourn it’s lack of traction. It’s interesting to see that the mobile age is increasing this propensity. 80% of Sportsbook customers placed a bet using a mobile device. Mobile revenue was up 68% and Gaming revenue also trebled.
However, my quest continues!
Category: Betfair
