(Reuters) – British bookmaker 888 Holdings on Wednesday terminated its contract with Sports Illustrated, giving it the option of selling or exiting its U.S. direct-to-consumer business, citing intense competition and low profit margins. He announced that he is considering it.
Sports Illustrated (SI), known for its sports magazine of the same name, entered the online betting market with an exclusive agreement with 888 in 2021 to attract SI fans.
Sports betting in the United States has rapidly gained popularity in recent years since it was legalized in 2018, with domestic players increasingly partnering with or acquiring British betting entities that are more experienced in the field. are doing.
But it's been a long road to profitability for many sports gambling groups, including market leader Flutter's FanDuel, which turned a profit for the first time last year.
“The intensity of competition and the demands of scale in the United States require significant investments to achieve profitability,” 888 CEO Per Widerström said in a statement.
BetMGM, which is jointly owned by Ladbrokes owner Entain and MGM Resorts, turned a profit for the first time in the second half of last year.
888, which operates in four U.S. states, announced it is terminating its contract with SI's parent company, Authentic Brands, and will pay a termination fee of approximately $25 million.
The termination is expected to save 888 approximately $6 million to $7 million annually in 2024 and 2025, it added.
(Reporting by Yadarisa Chabon in Bengaluru; Editing by Rashmi Aichi)
