Ladies and gentlemen, thank you for standing by and walked through the DraftKings Q3, 2021 earnings call. At this time, all participants are in a listen-only mode after the speakers presentation, there will be a question-and-answer session to ask a question during the session [Operator Instruction]. If you require any further assistance, please. First stars euro, I will now. I will turn the call over to your host Dodge DAS Chief Legal Officer. You may begin.

Good morning, everyone. And thanks for joining us today. The inventory during this call that are not statements of historical fact constitute forward-looking statements that are subject to risks uncertainties and other factors that could cause our actual results to differ materially from historical results or from our forecast. We assume no responsibility for updating forward-looking statements. For more information, please refer to the risks, uncertainties, and other factors discussed in our SEC filings. During the call, management will also discuss certain non-GAAP measures that we believe may be useful in evaluating DraftKings ' operating performance. These measures should not be considered in isolation or as a substitute for DraftKings ' financial results prepared in accordance with GAAP. A reconciliation of these non-GAAP measures to the most directly comparable GAAP measures is available in our quarterly report on Form 10-Q, filed today with the SEC, and in our earnings presentation, both of which are available on our website at investors. draftkings.com. Hosting the call today, we have Jason Robins, Co-Founder, Chief Executive Officer, and Chairman of DraftKings, who'll share some opening remarks and an update on our business. And Jason Park, Chief Financial of DraftKings will provide the review of our financials. We will then open up the line to questions. I will now turn the call over to Jason Robins.

Good morning, everyone. On today's call, I will cover the following topics. First, we're very pleased with our Q3 performance. Revenue in the third quarter grew 60% year-over-year and met our guidance due to continued excellent customer acquisition and engagement. Lower than expected sports betting hold primarily due to NFL game outcomes impacted revenue and EBITDA in the quarter. Strong customer acquisition performance and new state launches, particularly Arizona, drove additional promotional investment which also impacted third quarter revenue and EBITDA. In addition to mobile sports betting launches in Arizona and Wyoming in Q3, we also launched mobile sports betting and iGaming in Connecticut in October. Second, looking forward. The pipeline and new states in Canadian provinces continues to be healthy. Louisiana, Maryland, New York, and Ontario have all authorized mobile sports betting and Ontario has authorized IDB. We expect these jurisdictions to launch in the coming month. Third, the migration to our in-house bet engine and proprietary sports betting technology is complete. We are thrilled with the early performance and our new ability to rapidly add innovative features and functionality to our top ranked mobile sports betting app. I'm also very proud of the team for delivering ahead of our scheduled deadline. Fourth, our new growth initiatives which include DraftKings Marketplace in our Content and Media business are seeing promising early results. Fifth, we are very excited about the pending acquisition of Golden Nugget Online Gaming and are working towards closing in early 2022. I will also comment on the discussions we had with Entain. And before turning it over to Jason Park, I will also provide an update on our ongoing responsible gaming and corporate and social responsibility initiatives. We delivered strong revenue growth of 60% in the third quarter of 2021, which met our guidance from our…

Thank you, Jason, and good morning everyone. We're pleased to announce that we generated $213 million in revenue for the quarter, representing a 60% increase versus Q3 2020 revenue of $133 million. Our [Indiscernible] business generated $189 million for the quarter, representing an 82% increase versus prior year. Offset by B2B, which declined 19% versus prior year to $24 million. A year-over-year decline in B2B reflects the impact of the termination of our Asia Reseller Agreement, which we ended on April 1, 2021 with a transition period that has already ended. In terms of the B2C business, we continue to drive strong growth in player acquisition and retention as measured through [Indiscernible] as well it's player engagement and monetization as measured through [Indiscernible], BDC monthly unique payers in the quarter increased 31% year-over-year to 1.3 million. The increase reflects the expansion of our OSB and iGaming product offerings into new states and superb retention of existing players. Results reflect typical intra -quarter seasonality with July and August lower from a month's perspective, while in September, we had a record 2.1 million MUPs due to the start of the NFL season. Average revenue per monthly unique payer or ARPMUP, was $47 in Q3, representing a 38% increase versus the same period in 2020. Our ARPMUP was positively impacted by strong customer engagement, our continued mix shift into our sportsbook and iGaming product offerings and cross-selling our customers into more products. We guided to $213 million at the midpoint and delivered $213 million. Revenue would have been $40 million higher were it not for lower than forecast [Indiscernible] rates and investment in new state launches. Lower than forecasted [Indiscernible] cost us roughly $25 million of revenue in the third quarter. While hold was higher than Q3 prior year, it was lower than…

Our revised guidance equates to year-over-year revenue growth of 93 to 99%. We expect both [Indiscernible] and ARPMUP up to grow in 2020. One with [Indiscernible] increasing at more than twice the rate ARPMUP. This guidance assumes no new states. We expect Q4 EBITDA loss to be a little less than half of our Q3 2021 loss. This is a wider loss in what we communicated in August, primarily because our August guidance did not include new states. We are acquiring customers faster than we expected in our new states that still attractive [Indiscernible] consistent with our 2 to 3-year payback periods. And on that note, I want to affirm our conviction in our state level path to profitability. As a reminder, we have discussed a two to three-year time frame for new states to become profitable and at our Investor Day earlier this year, we confirmed that New Jersey had already reached this threshold on the earlier side of that 2-to-3-year window. I look forward to providing an update on New Jersey as well as more detail on path to profitability in additional states early next year once we have full 2021 results. As we look beyond 2021, we have completed our multiyear an annual planning processes, and have high confidence that our 2022 revenue will be in the range of $1.7 to $1.9 billion. We are only including states in which we are currently live and we are utilizing empirical data on cohort performance along with new product functionality and its expected impact. We are also including expected growth from our media and content business, as well as DraftKings Marketplace. We are not including the impact of the Golden Nugget acquisition, which we anticipate will close in Q1 of 2022. We are very excited about our growth prospects underpinned by an exciting team, sustainable differentiation due to our brand and product and technology capabilities which drive very attractive unit economics and LTV to CAC ratios. That concludes our remarks and we will now open the line for questions.

Ladies and gentlemen, if you have a question or comment at this time, [Operator Instructions]. And we also ask that you limit yourself to one question. Our first question comes from Bernie McTernan with Needham & Company.

Great. Good morning. Thanks for taking the questions. Here are the questions. I was just wondering on the Entain offer, is there a reason why it would be advantageous to go global now? I know it's, obviously, still pretty early days in the U.S. opportunity. And then within that, how unique is Entain as a potential global asset as you evaluate other M&A framework?

Thank you, Bernie. So, we've laid out a few areas that we would potentially look to in terms of M&A. One is global expansion. Also, product expansion and also things that we think would help us further improve our position in the U.S. market. So, all of those are areas we look at. I think as opportunities come along, it's hard to sort of say, hey, I'm going to do this 1 first, this 1 second, and it's 1 third, it's like here at the list and we'll look at being. As they come along. I think that we were certainly very impressed at the entertain team and Company they've built. I think they're a great asset. There are other international assets that I think are of interest as well. But Entain is a great Company. So, in this case, we just decided it wasn't the right thing for us at this time to pursue them and I think we'll continue to look at things out there. Most of the things we look at, we don't end up pursuing. And this was a unique one, because due to the UK Takeover Code, a very early discussion had to get publicized when normally we would just never have the [Indiscernible].

Understood. Thanks for taking the question.

You're welcome.

Our next question comes from Jed Kelly of Oppenheimer.

Hey, great. Thanks for taking my question. Just on the guidance for next year, I think you've mentioned product, some of the products. So how much of that factors in sort of migrating SP Tech in closing the yield gap. And then, Jason, just a longer-term one on media. A lot of it seems commoditized between all the different providers. You see it all on Twitter every Sunday. How do you think about differentiating your media strategy? Is it going to be getting Tier-1 sports content on your platform? Thanks.

So, on the first topic, I think we have really exciting plans and a great product roadmap for next year. I think we recently launched same Game Parlays, pushing that and continuing to make that a best-in-class offering and driving additional user adoption, I think will be very helpful. We already saw overall parlays move from I think 15% to 23% in just a couple of months. So, I think with a full year next year under our belt, we think we can really move that percentage up and get a lot more adoption of same game parlay in general. And we have a number of other features including our social features and other things that we think are going to have really exciting developments next year. So, we do expect that to contribute. What we would say about that hold question is -- we're not always really -- we don't really look to optimize the rate of hold. We look to optimize gross profit. In some cases, that might mean that you actually drive more volume through having promotions and other things that can drive down hold percentage, but end up being gross profit positive. And then of course we look to maximize long-term LTV of our customers. So that's really our primary focus, but I do think some of the things, such as the continued adoption of same game parlays, will help drive that rate of holdup as well. On the media question, I agree that there is a lot of commoditized media and content out there. We will have more to say, I don't want to tip our hand, but I actually I'm very excited about the strategy that our new Chief Media Officer, Brian, has put together. And I think it's going to allow us to pursue this in a unique and differentiated way. So, beyond that, I think there's also this really strong synergies with the things that we have planned along with the core areas of our business now and the DFF OSB, and iGaming side. So more and more to say on that in the coming quarters.

Thank you.

Our next question comes from Joe Greff with JPMorgan.

Thanks for taking my question. Jason, thanks for providing 2002 revenue guidance. I was hoping you could speak a little bit maybe directionally on cost of revenue and sales and marketing in 2022 relative to what you've, what you'd anticipated in Incorporated for 2021.

I think the big wildcard with 2022 is, of course, what new state launches look like. We didn't include that in our revenue guidance, but by the time we actually end up publishing results, I'm expecting there will be additional states in there, and that's going to move the needle quite a bit on our external marketing investment. Beyond that, I think right now we really like the flexibility of being able to spend deeper when the results are there. We had tremendous CAC in Arizona. I mean, that just absolutely blew away our expectations at the volume. We were able to acquire and keeping that CAC as low as we did. So, I think we like the flexibility of being able to spend deeper, and not having an external commitment to what sales and marketing would look like.

Thank you.

Our next question comes from Shaun Kelley, with Bank of America.

Hey, good morning everyone. Just wanted to ask a little bit more, maybe on the CAC environment, Jason. There has been some discussion out there that maybe the marketing and promotional environment is actually slower a little bit. Just given some really aggressive tactics very early on in the NFL launch. Is that consistent with behavior you've seen, and how do you think that trends as we move across the [Indiscernible] in particular?

It's hard for me to say what others are doing. We certainly monitor the marketplace, but it's not totally precise. That said, I do think you're right that there has been a little bit of a pull back. From our perspective, we just follow the data, so we're going to spend when the results are coming in and we're going to pull back if they're not and we're seeing still really, really strong CACs and really, really good volume coming. Not just in new states, but in some of our more tenured states as well, so that's really our approach. Obviously, the overall media environment has an effect on that, but it cuts both ways. Yes, there's competition for customers, but also more overall spend from the entire industry drives more people into the market, which I think benefits those, that which we feel we do have the best-in-class products and experiences. So, I think that's actually an interesting way to look at it. That, yes, of course, there's more competition for customers, but it's also growing the market faster. And Arizona is a great example of that where we just -- were way, way ahead of the pace that we've seen in other states like New Jersey, Pennsylvania, and Indiana, despite the fact that we didn't really have a DFS database there like we did in those other states.

Thank you very much.

Thank you.

Our next question comes from Thomas Allen with Morgan Stanley.

Thanks, I'm trying to Q&A here first off, their news reports this week about you likely getting a license in New York. Can you just talk about how you're going to approach that market? And if you think there can be long term profitability, there was such high-tech tax rates and secondly, just on the try or tried to guide how much of your thinking about -- how much are you embedding NFT's in that guidance. Thanks.

Thanks, Thomas. So, I think we obviously want to wait and see what the regulator and what the state of New York says about whether we're able to achieve getting that license. Certainly, we would love that, and hopefully, those rumors are true. But we'll find out when we find out and we'll be respectful of that process. That said, if we were to be awarded a license, I think we feel just like we In other states, that we can achieve the same long-term profit margins in New York. There's a lot of levers we can pull, such as cutting back on rate of promotion and spending less on external marketing. Those are things I would expect everyone in the industry would do because I don't think anyone is going to want to run at a long-term unprofitable rate in any state. Certainly, early on, we will approach it just like we do other states where we'll invest into it and look for that 2-to-3-year path to profitability. But I think over the long term, we feel we can achieve something in the similar range, in a similar range to what we're achieving in other states from a long-term margin perspective. And then on the second question. It's not insignificant, but it's not super meaningful either. We have less than a $100 million in the plan for that, for the [Indiscernible]. So, we're pretty excited about it. We think it's going to be a growth product, but we're also taking a measured approach and not putting too much in there, and really relying on the strength of the core business to carry a next year in our guidance.

Thank you.

Our next question comes from Michael Graham with Canaccord.

Thank you. A quick one, just can you remind us on the magnitude of the gross margin benefit you're expecting to see from the in-house technology switch. And then more broadly, wondering if you can comment, like going back and looking at a more mature state like in New Jersey. What are you seeing in terms of player behavior where you're not as focused on gaining new players in terms of like what is driving loyalty or what is driving switching? Just any learnings you have there in some of those more mature states that you can apply to the newer states.

I'll answer your second first and then I'm going to turn it to Jason Park to answer the first one. So, New Jersey and it's almost funny to call it a more mature state. It's still only a little over 3 years in, and we're still seeing really strong user growth there, that is in part driven by strong royalty. We're seeing great retention numbers, but we're also still acquiring customers as well. So really excited about New Jersey, really excited about our more tenured states. I think that what we're proving out is that two to three-year payback on the customer and two to three-year path to profitability in a state, really will hold. And we're going to talk more about that once we have full-year results in Q1 time frame. And I think similar to all of how we approach everything, we're just going to follow the data as long as customer acquisition is continuing to work, we're going to invest there. Certainly, we expect some of the earlier cohorts to have stronger LTV. So, we're keeping a close eye on that, but New Jersey still only 3 years in, and I think if obviously a little bit of a different ramp, but if you look at the iGaming market, which is I think in its seventh or eighth year at this point, it's still growing. The 30-plus percent we're growing more than that. So, I think New Jersey, you're going to see grow for many years to come. And then Jason, do you want to take?

Yes, sure. Hey, good morning, Mike. The gross margin rate impact from being vertically integrated that's commenced in Q4. As a reminder, some roughly high single-digits of revenue for the OSB product offering only. So please don't apply that to the entire business. For the OSB product offering, that essentially goes away in Q4.

Okay. Thanks a lot.

The next question comes from Stephen Grambling with Goldman Sachs.

Hi, thanks. You made a comment that nobody wants to run an unprofitable business and it seems like some peers, from piecing together public disclosures, maybe running sports betting at near, I would say, even close to 0 revenue. Let alone profit to feed in the iGaming. Are you seeing any of this dynamic playing out and how do you think about your strategy in that context? Thanks.

I think it is still very early in the market, and I am not so sure that that's going to continue long term. As far as how it inter plays between products, we're always looking at total value. So right now, that doesn't seem like an approach that we think based on what we see makes sense, but could it ever be something that us or others think makes sense, perhaps? But I don't see that as a likely outcome. I think that sports betting on its own is going to be a very profitable business for us. We're already seeing that New Jersey as an example. So, I expect that to be the case across states. Also, most states don't have iGaming at this point. There's about 39% of the population with legalized sports betting and only I think 11%, I want to say with iGaming. We really have to feel like we can run the sports betting vertical at a profit even just to make it work from that perspective.

Great. Thanks so much.

Thank you.

The next question comes from Joe Stauff is Susquehanna.

Good morning. Just a question on user growth, you know, $2.1 million MUPs in September. With the NBA launching in October, I would imagine that number, directionally, is going to go up. What's the right way to think about how that is going to say evolve, both going into November, as well as December. And then New Jersey, MUP growth of 23% in third quarter, which she said, Jason, is interesting. And I'm curious to see, is it fair to assume most of that MUP growth is really sourcing from the sports side of the product offering? Thank you.

Sorry. Can you say the second question one more time and I'll answer it.

Sure. In New Jersey, your MUP growth up 23% in the third quarter. Are most of those new users really coming from the sports side of your product offering?

So, on your first question, overall MUP, we think Q4 will be in a similar range to what September was. Yes, you're right. NBA is starting, but also as the NFL season continues, there's less activity. And right now, I think that we're still seeing really strong month-over-month going into both October and early November. But historically, we've seen that turned down a bit and then it tends to pick back up again once the playoffs are going into the Super Bowl. In terms of New Jersey, it's really a combination of customer acquisition and also really strong retention that's driving that. And our sports offering is certainly a big driver of what gets people there. Once we have them on the platform, they're playing across products, so it's really hard to say, is sports driving more active, or is it iGaming? But our goal, of course, is to get as much crossover as possible. And we've been able to cross-sell over 50% of our online sportsbook customers into iGaming. So, I think typically sports is where we acquire the players, but in a state that's a few years in like New Jersey where there's so much being driven off of existing cohorts. It's really hard to say.

Thank you.

Next question comes from Carlo Santarelli with Deutsche Bank.

Hey guys, thanks. Jason, if you could, when you guys think about how kind of the whole percentage and directionally, when you think about the whole percentage, we all look at obviously state data and there's a lot that's in there that we don't necessarily have full transparency up. But when you look at like average blends at holds that get reported at the percent. How would you say that number compares to what the reality is when you take out the promo aspect of what drags those holds lower?

Hey, Carlo. This is Jason Park. I'll try to tackle that one. I totally agree with you. The state tax report, I think it's really important to remind everyone those are regulatory and tax reports and trying to bridge those to GAAP can be difficult, not to mention that every state has a slightly different definition of hold and handle. I think that's a the most important thing it is difficult. We -- having said that, we do see those and we notice I think what you're noticing which is DraftKings is sort of at parity with the broad swath of the industry. There is a couple of outliers. I think the right way to think about it is, what would drive those state tax report hold numbers -- hold percentages higher for certain competitors? And it really just comes down to a couple of different vectors. I think product mix is a big one and certain operators just likely have a higher parlay mix as a percentage of their total handle. Which would drive hold percentage up and as you know, we've launched in Game Parlay, and we're really excited about the traction there. So, I think that will change over time. And then another potential reason is just promotional mix, which really does get obfuscated in the state tax reports. And to the extent that an Operator uses more free bets that can really sort of make the state tax reports look like they have a higher hold percentage. Those free bets come through at a very high hold percentage.

Yeah. And then just to add to that last point. The free bet doesn't pay out the stake. So, it inflates the hold rate versus Todd's boosts or other sorts of things that are directly affecting the odds that takes it down. the promotional impact from a GAAP perspective might be similar, but the state hold rate looks higher and the tax basis it looks higher and that's one of the factors we consider when deciding what types of promotion is to run. Obviously, we want to do what's best for the customer, but we're also looking at how we optimize for taxes.

Great. Thank you, guys.

Thank you.

Next question comes from Ben Adam with Loop Capital Markets.

Hi! Good morning, guys. Regarding the $25 million hold impacts of revenues in the quarter, what was the EBITDA impact from holding in Q3? And then, separately, yesterday, Penn called out a $12.5 million lobbying expense in California; just wondering if -- were you guys part of that lobbying consortium as well? And if so, did that flow through the P&L in Q3?

That the flow-through on the Q3, 25 million in this would apply to Q4, as well as very high flow-through. There are it is not a 100% flow-through because there are certain elements of COGS that you still have to pay regardless of what the GGR

And so on. The second question, we are part of the consortium in California, there's 7 operators that have contributed to it, and we've raised about a $100 million so far. I think we're really well positioned there. As far as how it impacted the P&L, I think it does get included in its adjusted out. It is not part of our adjusted EBITDA.

Okay. Great. Thanks, [Indiscernible].

Our next question comes from Robin Farley with UBS.

Great. Thanks. I just wanted to understand some of the puts and takes for the change in your full-year guidance. You mentioned that marketplace will contribute about $100 million to next year. So, thinking that maybe 25 million to the 21 change in guidance and you highlighted the whole issues in Q3 and Q4. How much for New States because your previous guidance didn't include New States that have since come online so, just how much of that piece. Thanks.

Marketplace, I know I said less than 100 in the '70s and we launched it in August of this year. I think that this year it's going to be closer to 10, 15 versus 25, but we don't really know yet. It's still sort of a very new product, so we've actually been, I think, quite conservative with how we've looked at that in the guidance. As far as the new state impact to next year, we have not included in the New States. Matt, next year, sorry or this year?

The New States this year. So, you're -- I know that the net change in your 21 guidance and just what piece of it was a New States.

Okay. New States are pretty modest in terms of their contribution in Q4, and they're actually close to 0 in terms of the year. So, as we noted in our earnings call, we had about $14, $15 million investment in Arizona in particular that hit Q3 on a negative revenue side. We're going to make back less than that in the Q4 time frame. So really there's really no impact from New States on the guide this year. In fact, if anything, it's slightly negative.

Okay. That's helpful and I appreciate that you guys are now breaking out the hold impact. Is there anything when we think about next year? Could you talk about the negative hold in Q3 and Q4? Is there anything that was above-average hold at benefited in the first half that we should think about that will be a tougher comp for you or that would make your guidance next year actually and currently better?

We actually mentioned in our Q2 call that we held above what we were forecasting. So, we had a positive variance in Q2. I can -- we can go back and look and see. I think we quantified that. Yes, we quantified it, but happy to offline. Have our team point you towards the materials and then Q1 Jason. Do you remember if that was also above?

It's also a good guide in Q1.

We had another positive variance in Q1. So, you're right, the first half of the year did benefit. It swings both ways, of course. But we can point you towards some of the specific numbers if you'd think about next year, offline.

Yeah. I appreciate that. I don't think you would quantify the first half completely, so thanks.

You're welcome.

Our next question comes from David Katz of Jefferies.

Hi, good morning, everyone. Thanks for taking my question. You've started roll in micro beads and in-game wagering which I've understood historically has higher hold considerably so. Number one. Has that performed the way you've expected it so show far and second, Should that be accretive to hold percentage as you roll more of it in?

So definitely. we've seen an increase in parlay mix, as we noted, went up already in just a couple of short months from 15% of our holds - excuse me, of our, is it revenue or handle?

Handle.

Of our handle to 23%. Interestingly, because so many favorites hit and so many money line favorites hit, it swings both ways. Overall, it can be a positive, but when you have a lot of favorites winning, it can actually go the other way. Parlays just tend to have higher variance in general, even though the average is higher. We do expect over a longer period of time, which hopefully Q4 will be in. Certainly, we expect for 2022, to see those continue to increase. Both as a percentage of handle and then also have a positive impact on our hold rate and our revenue overall. Some of that is built into the guide for next year.

Perfect. Thank you.

Our next question comes from Dan Politzer with Wells Fargo.

Hey, thanks for taking my question. I just wanted to drill a bit more into Entain. Can you talk a bit more about your rationale there for approaching them. Was it Global Technology or cash flow? And then just on your rationale for walking away, was it more of a function of price, deal complexity, or something else altogether?

So, as we noted earlier, one of our pillars we think for long-term growth will be global expansion. That could happen soon, it could happen years from now. We don't have a set timetable. We kind of look at different things as they come about, as long as they fit a long-term strategy. So, this is one that we thought potentially could have been a good route. Up for global expansion. As far as why we walked away, I think there are a variety of factors, and certainly, value is one of them. But there are a variety of factors that lead us to feel like it just wasn't the right thing for us to do at this time. I think [Indiscernible] complexity was probably a smaller part of it, although not entirely on meaningful factor is really more about our confidence in our current trajectory in the U.S. our desire to focus on the U.S. and ultimately the value that we felt like we would be shedding by pursuing that asset.

Understood. Thanks so much. so much.

Our next question comes from Chad Beynon with Macquarie.

Hi. Good morning. Thanks for taking my questions. With respect to your $25 million stock investment in Vivid, how should we think about what the intention was for this? if you have more access to the industry and you'll be able to learn more than what your plans are in the future in the ticket space? Thanks.

Well, we're very excited about the relationship we've developed with V ivid. We have a lot of interesting things planned, which we'll be unveiling in the coming quarters. And ticketing is certainly an area that we think overlaps. We have SportsFan and ticketserve, often bought by SportsFan to sporting events. And SportsFan go to other events too like concerts and things like that. So, our expectation is that with a hopeful return to post-pandemic, we're going to see a lot more activity in terms of concerts and sporting events. It seems like demand is up for those things, and we also got a really good deal. We don't typically invest. It's not a way that we really use investor capital often. We in fact established a totally separate entity called Drive by DraftKings which is our vehicle that we see is really the bulk of the investments that will be considered would be through that of the earlier stage. In the case of vivid, we got a great deal because along with the investment we've got to put right which protects us 100% on the downside. So beyond just wanting to have a deeper relationship with them, we also felt like it was just a really smart use of capital for the next year or so.

Thank you very much.

Our next question comes from Barry Jonas with Truist Securities. Hey guys, maybe just a high-level question as you think about that, $1.7 billion EBITDA target you presented at your Analyst Day, where do you see the most areas for upside and I guess also downside. as we sit here today.

Well, any of the great question there's a few areas I think they could have upside. One is the TAM could end up just being larger than we think. Certainly, we've seen evidence that the industry is developing faster and remains to be seen if that's actually an indication that the TAM is larger, but that could very well be a possibility. Secondly, I think you could see a deeper amount of legalization. We only assume, for example, 30% of the population would have iGaming, and 65% would have sports betting, and already, we're at 39% for online sports betting and 11% for iGaming less than 3 years since a little over 3 years since past [Indiscernible] overturned. So that could be another area of upside. Additionally, some of the areas we've talked about expansion, both global and product expansion, are not built into there. I think there could be some upside in that as well. We're particularly excited about the Marketplace product that we launched. We have big plans in the media and content space. And at some point, we'll have to see when we do think we'll expand globally. So, I think there's a lot of upside along all of those dimensions. As far as where there could be downside, I think the biggest assumption that we're focused on is around the share. And so far, that's done great. Despite the fact that the narrative has been competition, competition, everyone jumping in. We actually saw our share rise in September. We went up 2% in mobile sports betting, we went up 2% in iGaming. We're now above our long-term target for mobile sports betting. We're right in the middle of the range for our long-term target for iGaming and that's despite the fact that we're in, perhaps, the most competitive times. Certainly, I hope it's near the peak, but I think there's good argument that this is as competitive as it's ever going to get. Certainly, we are pretty excited about that. I think that there might even be some upside there as well on the share side, but right now we feel comfortable with what we've guided to long-term.

Really helpful. Thank you.

Welcome.

Our last question comes from Ryan Sigdahl, Craig-Hallum Capital Group.

Thanks for taking my question. Just one on the negative NGR and impact to revenue from promos and New States launches. Is that a primary function of the start of football in Q3 impacting that or is that the right assumption as we think about New State launches throughout other parts of the year?

So, I think that for -- I'll answer that in two ways. One, we are always optimizing our go-to-market playbook. I think we've gotten way better and that's part of why we've acquired so quickly in a state like Arizona, where we achieved a 100,000 customers, hundreds of days earlier than some of our older, more tenured states took. And part of that is figuring out what the right cocktail of external marketing spend is, What promos work, how to mix everything, channel mix other things. So, I think that's been a big thing that we've improved on, and the results are pretty striking, so that's part of what I would say that it's hard to say, this is going to be -- we're 3 years into this thing and I think it's hard to say that this is going to be exactly how it looks for any long-term period of time and we're always following the data and doing analytics to make it better. That said, I do think you're right that football is going to be or has been a big driver here because the volume of new customers that you can acquire, let's say a state launched in the middle of May. There is no way we would have been able to achieve the volume of new customers that we achieved in some of the states that launched at the beginning of football season, that just always the best time of the year to acquire customers. So, when you have more new customers coming in faster, it's going to drive more promotional investment, more external marketing investment and that's why I think you saw in Arizona and of course, the lesser extent, but still important Wyoming. And despite the fact that I said in the beginning, we're always optimizing, I would be surprised if that ever changes, unless there's some -- if football ever becomes less of the outsized customer acquisition time, then maybe. But I don't see that changing anytime soon.

Ladies and gentlemen, that concludes the Q&A portion of today's conference. I'd like to turn the call back over to our host for any closing remarks.

Thank you all for joining us on today's call. We appreciate your questions and look forward to continuing our conversations with you. We're excited for what the rest of the year and beyond holds for us. I hope you all stay safe and well, and we look forward to speaking with you on our next earnings call on February.

Ladies and gentlemen, this concludes today's presentation. You may now disconnect and have a wonderful day.