DraftKings (DraftKings) Gross Margin % : 41.78% (As of Dec. 2023)

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What is DraftKings Gross Margin %?

Gross Margin % is calculated as gross profit divided by its revenue. DraftKings's Gross Profit for the three months ended in Dec. 2023 was $514 Mil. DraftKings's Revenue for the three months ended in Dec. 2023 was $1,231 Mil. Therefore, DraftKings's Gross Margin % for the quarter that ended in Dec. 2023 was 41.78%.

Warning Sign:

DraftKings Inc gross margin has been in long-term decline. The average rate of decline per year is -15.5%.

The historical rank and industry rank for DraftKings's Gross Margin % or its related term are showing as below:

DKNG' s Gross Margin % Range Over the Past 10 Years
Min: 33.75 Med: 43.6 Max: 83.45
Current: 37.46

During the past 7 years, the highest Gross Margin % of DraftKings was 83.45%. The lowest was 33.75%. And the median was 43.60%.

DKNG's Gross Margin % is ranked worse than
59.22% of 765 companies
in the Travel & Leisure industry
Industry Median: 43.19 vs DKNG: 37.46

DraftKings had a gross margin of 41.78% for the quarter that ended in Dec. 2023 => Durable competitive advantage

The 5-Year average Growth Rate of Gross Margin for DraftKings was -15.50% per year.

DraftKings Gross Margin % Historical Data

The historical data trend for DraftKings's Gross Margin % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

DraftKings Gross Margin % Chart

DraftKings Annual Data

Trend

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Gross Margin %

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67.88

43.60

38.72

33.75

37.46

DraftKings Quarterly Data
	Dec18	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Gross Margin %	Get a 7-Day Free Trial															43.23	32.21	41.67	31.20	41.78

Competitive Comparison of DraftKings's Gross Margin %

For the Gambling subindustry, DraftKings's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

DraftKings's Gross Margin % Distribution in the Travel & Leisure Industry

For the Travel & Leisure industry and Consumer Cyclical sector, DraftKings's Gross Margin % distribution charts can be found below:

* The bar in red indicates where DraftKings's Gross Margin % falls into.

DraftKings Gross Margin % Calculation

Gross Margin is the percentage of Gross Profit out of sales or Revenue.

DraftKings's Gross Margin for the fiscal year that ended in Dec. 2023 is calculated as

Gross Margin % (A: Dec. 2023 )	=	Gross Profit (A: Dec. 2023 )	/	Revenue (A: Dec. 2023 )
	=	1373.2	/	3665.393
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(3665.393 - 2292.175)	/	3665.393
	=	37.46 %

DraftKings's Gross Margin for the quarter that ended in Dec. 2023 is calculated as

Gross Margin % (Q: Dec. 2023 )	=	Gross Profit (Q: Dec. 2023 )	/	Revenue (Q: Dec. 2023 )
	=	514.2	/	1230.857
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(1230.857 - 716.658)	/	1230.857
	=	41.78 %

A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.

DraftKings (NAS:DKNG) Gross Margin % Explanation

Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.

Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %

1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key

DraftKings had a gross margin of 41.78% for the quarter that ended in Dec. 2023 => Durable competitive advantage

Be Aware

If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.

DraftKings Gross Margin % Related Terms

Thank you for viewing the detailed overview of DraftKings's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.

DraftKings (DraftKings) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Travel & Leisure » DraftKings Inc (NAS:DKNG) » Definitions » Gross Margin %

Comparable Companies

Traded in Other Exchanges

DKNG:Mexico 8DEA:Germany D2KN34:Brazil

Address

222 Berkeley Street, 5th Floor, Boston, MA, USA, 02116

Website

https://www.draftkings.com

DraftKings got its start in 2012 as an innovator in daily fantasy sports. Then, following a Supreme Court ruling in 2018 that allowed states to legalize online sports wagering, the company expanded into online sports and casino gambling, where it generally holds the number two or three revenue share position across states in which it competes. DraftKings is now live with online sports betting in 21 states (44% of the U.S. population) and iGaming in five states (11% of U.S.), with both products available to around 40% of Canada's population. The company also operates a non-fungible token commissioned-based marketplace and develops and licenses online gaming products.

Executives

Jason Robins	director, officer: See Remarks	222 BERKELEY STREET, FLOOR 5, BOSTON MA 02116
Matthew Kalish	director, officer: See Remarks	222 BERKELEY STREET, FLOOR 5, BOSTON MA 02116
Paul Liberman	director, officer: See Remarks	222 BERKELEY STREET, FLOOR 5, BOSTON MA 02116
R Stanton Dodge	officer: Chief Legal Officer	ECHOSTAR CORPORATION, 100 INVERNESS TERRACE EAST, ENGLEWOOD CO 80112
Jason Park	officer: Chief Financial Officer	222 BERKELEY STREET, FLOOR 5, BOSTON MA 02116
Erik Bradbury	officer: Chief Accounting Officer	222 BERKELEY STREET, FLOOR 5, BOSTON MA 02116
Marni M Walden	director	1095 AVENUE OF THE AMERICAS, 8TH FLOOR, NEW YORK NY 10036
Shalom Meckenzie	director	222 BERKELEY STREET, FLOOR 5, BOSTON MA 02116
Ryan R Moore	director	56 WAREHAM STREET, 3RD FLOOR, BOSTON MA 02118
Jocelyn Moore	director	222 BERKELEY STREET, FLOOR 5, BOSTON MA 02116
Steven Joseph Murray	director	C/O SOFTBANK CAPITAL, 38 GLEN AVENUE, NEWTON MA 02459
Woodrow Levin	director	535 MISSION STREET, 11TH FLOOR, SAN FRANSISCO CA 941105
Harry Sloan	director	1450 2ND STREET, SUITE 247, SANTA MONICA CA 90401
Valerie Mosley	director	TWO INTERNATIONAL PLACE, BOSTON MA 02110
Hany M Nada	director	800 MARKET STREET #800 SAN FRANCISCO CA 94102