Sports betting company DraftKings, which recently went public, posted a loss of $68.7 million during the first quarter of 2020. This loss is more than double on a year-on-year basis.

Surprising loss

DraftKings’s $68.7 million loss comes as a surprise to many. The company went public last month and is being considered a great investment by many seasoned buyers. However, the recent coronavirus pandemic has eaten into its revenues. The cancellation of sports betting events across the globe led to ballooning losses.

The Boston-based company reported a first-quarter loss of $29.5 million in 2019. This year, its total revenue increased to $88.5 million from $68 million. However, the loss rose to $0.18 per share, instead of $0.13 per share expected by Wall Street.

Jason Robins, the CEO of DraftKings said that he is optimistic about the business, despite the recent setbacks related to COVID-19. He also noted a growth in user base, saying,

“The engagement we continue to see from our customers validates the connection they have with our content, their passion for our products and most importantly their loyalty to our brand.”

Impact of the pandemic

Even though COVID-19 had a significant impact on its revenue, DraftKings suggests that it would not have an impact on the 2021 fiscal year or its long-term plans. Its business is being impacted by sporting event cancellations. However, there is some ray of hope for them. UFC recently held its first event in weeks and German football is also on its way to restart. NASCAR is also considering a comeback alongside some golfing tournaments. Another UFC event is slated for this weekend, which could help the company gather some momentum before other sports return.

Meanwhile, the platform is providing users an opportunity to bet on fantasy products like video games. There is already a market for eNASCAR, Counter-Strike: Global Offensive and Rocket League. It also launched numerous other free-to-play contests that revolved around pop culture.

After going public DraftKings has enjoyed strong growth in the market. Its share price has increased 10% from the day of listing. According to leading financial analysts, the stock is a bull case. Recently, a George Soros controlled fund also invested in the firm.