- 888 Casino has posted strong numbers in 2020 so far and expects to see continued financial success despite the COVID-19 pandemic.
- Even with drastically reduced sports betting activity, 888 has seen continued success during the pandemic because of increased poker and casino play.
- Sports betting accounts for only 16% of 888’s revenues, so other companies that are more reliant on sports betting could be affected more severely.
- As the crisis continues, 888 and other online casinos could be affected in unpredictable ways.
GIBRALTAR – 888 Casino, one of the largest online casinos in the world, stated in a press release on Tuesday that its Executive Board expects the company to see continued financial success despite the severe global Coronavirus outbreak.
The release describes both 888’s current trading outlook, as well as speculation about its outlook for the 2020 fiscal year.
December 2019 produced record high revenues for 888, and daily revenues through the first two and a half months of 2020 have been 24 percent higher on average than those of 2019.
888 will feel the sting of the COVID-19 outbreak in the months to come as the company’s sportsbook will see drastically reduced betting action. Oddsmakers have had to turn to increasingly unconventional sources just to provide players with something to bet on.
So far, the loss of sports betting revenue been mitigated by an increase in other forms of online gambling as people are staying home with little to do. The release mentions that activity in both poker and other online casino games has increased in recent days.
If the disruption of major global sports were to continue until September 2020, which seems likely, the 888 Board expects the impact on its earnings before interest, taxes, depreciation and amortization (EBITDA) to be in the single-digit millions of dollars.
888 is not as reliant on sports betting as some other companies. Its sportsbook accounts for only 16 percent of the company’s gross 2019 revenue. With a high level of liquidity (cash reserves of nearly $100 million), 888 expects to be able to weather the Coronavirus storm.
For now, the impact COVID-19 will have on online gambling operators will largely depend on the scope of their reliance on sports betting income.
Other forms of online gambling will likely to continue seeing high traffic as more people are stuck at home under quarantine. Companies that prioritize all their online gambling activities, rather than just online sports betting, should experience only a moderate hiccup.
However, the Board’s release also warns that customers might begin to be stingier with their money as the crisis gets worse. Millions of people around the world have already been laid off or furloughed, and more will likely follow suit.
In the United States, Congress passed a stimulus bill on Wednesday that should put a good amount of money directly into the hands of American citizens, which might boost activity for online casinos.
The Board also expressed concern that even if online casino play increased, there might be a corresponding increase in problem gambling habits. They maintain that 888 will continue to monitor and communicate with their players to provide them with the necessary tools to curb gambling-related harm.
The COVID-19 crisis is unprecedented, and it has still yet to reach its peak. This makes it difficult, if not impossible, to accurately predict how it will affect global business. Online casinos like 888 appear to be better positioned than most other industries, but only time will tell.