PokerStars Revenue Drops 12%, Below $200M For First Time in Years
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PokerStars posted some of its weakest revenue numbers in years in its most recent quarterly report, with revenues dipping 12 percent year over year, according to Poker Industry PRO ($).
It's at least the third consecutive quarter of year-over-year decline for PokerStars, with total revenue dipping to $191.5 million. According to graphs provided by PRO, it's the first time PokerStars has failed to pull in $200 million in revenue since 2016.
Numbers Trending Down
On a constant currency basis, the decline was a little less severe, checking in at 7%. However, the numbers and graphs provided by PRO paint a clear picture of recent stumbles for the worldwide leader in online poker.
In Q3 of 2018, PokerStars pulled in $212.8 million, which was already a year-over-year decline of 3.9%. The next quarter, revenues fell to $210.9 million, a year-over-year plunge of 10%. Another year-over-year drop of 12.9% followed, but at least total revenues remained at $214.1 million.
The recent dip to $191.5 million was the lowest recorded in the five-year trend provided by PRO.
Numbers for the year are on pace to barely crack $800 million after the past two years saw the company push toward the $900 million mark.
Investors have taken notice as well, according to OnlinePokerReport. Value of a share of parent company The Stars Group fell from $16 at the close of last week to around $13 after the Monday release of the quarterly numbers. That's a drop of almost 20 percent, although it has recovered some to $13.95 at the time of writing.
Decline in Poker's Importance
The 2018 acquisition of Sky Betting & Gaming has positioned The Stars Group as a major player in the online sports betting market. As a result, the importance of poker to the company has taken a tumble.
For the first time, poker has been surpassed by sports in terms of share of company revenue produced. Not only that, but casino also surpassed poker, with poker accounting for 30.4% of revenue while casino checked in at 30.8% and sports at 35.7%.
As The Stars Group makes further moves into the expanding U.S. sports betting market — such as a recent partnership with Penn National gaming — that trend may only continue.
Latest Moves
PokerStars remains the unquestioned top dog in the online poker market. PokerScout has their numbers at more than triple the nearest competitor, but that's actually less dominant than the company's position a year ago, when it boasted more than four times the traffic of the second-place site.
There have been some recent moves made by the red spade as the operator attempts to reverse some of the concerning trends.
For example, Spin & Gos are being dropped from the fenced Indian market ($) in response to low customer demand. Other games such as knockout formats and traditional sit-n-gos will be taking their place. The change takes effect Friday, with PokerStars hoping to gain ground on local rooms that have the lead in market share.
More significantly for a wider swath of the customer base, PRO has revealed that another new game may soon be hitting the dot-com client. A new option called "Swap Hold'em" has been added to the list of games, but no selectable tables or tournaments have appeared under the filter.
Swap Hold'em may be the latest in a line of inventive, non-traditional games spread by the operator, the most recent of which was the growing high roller special, short deck hold'em. Reached for comment by PokerNews, a representative of PokerStars said she was unable to offer comment on Swap Hold'em.
In any case, PokerStars — and its shareholders — will undoubtedly hope that the company can turn things around and reverse the recent trends.
The Stars Group owns a majority shareholding in iBus Media.
