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Segments and Disaggregation of Revenue | 3 Months Ended
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Mar. 31, 2024
Segment Reporting [Abstract] |
Segments and Disaggregation of Revenue |
3. | SEGMENTS AND DISAGGREGATION OF REVENUE
The Group reports its financial statements based on four reportable segments:
| • |  | U.S.;
| • |  | UK & Ireland;
| • |  | International; and
| • |  | Australia
The segment information aligns with how the chief operating decision maker (“CODM”) reviews and manages the business. The Group determined that it is the Chief Executive Officer and Chief Financial Officer jointly who are performing the function of CODM. Beginning January 1, 2024, the Group revised its definition of Adjusted EBITDA, which is the segment measurement used to evaluate performance and allocate resources. The definition of Adjusted EBITDA now excludes share-based compensation as management believes inclusion of share-based compensation can obscure underlying business trends as share-based compensation could vary widely among companies due to different plans in place resulting in companies using share-based compensation awards differently, both in type and quantity of awards granted. Effective January 1, 2024, subsequent to the Group’s decision to close the sports betting platform “FOX Bet”, the Group reorganized how the PokerStars (U.S.) business is managed which resulted in a change in operating segment composition. From January 1, 2024, PokerStars (U.S.) is included in the International segment as opposed to the U.S. segment. Segment results for the three months ended March 31, 2023, have been revised to reflect the change in operating segment measurement and change in operating segment composition. The Group manages its assets on a total company basis, not by operating segment. Therefore, the CODM does not regularly review any asset information by operating segment and accordingly, the Group does not report asset information by operating segment. The following tables present the Group’s segment information:
|  | Three months ended March 31, |
($ in millions) |  | 2024 |  |  | 2023 |
Revenue |  |  |  |  |  |  |  |
U.S. |  |  |  |  |  |  |  |
Sportsbook |  | $ | 986 |  |  | $ | 759 |
iGaming |  |  | 358 |  |  |  | 241 |
Other |  |  | 66 |  |  |  | 71 |
U.S. segment revenue |  |  | 1,410 |  |  |  | 1,071 |
UKI |  |  |  |  |  |  |  |
Sportsbook |  |  | 411 |  |  |  | 376 |
iGaming |  |  | 406 |  |  |  | 319 |
Other |  |  | 44 |  |  |  | 41 |
UKI segment revenue |  |  | 861 |  |  |  | 736 |
International |  |  |  |  |  |  |  |
Sportsbook |  |  | 160 |  |  |  | 181 |
iGaming |  |  | 600 |  |  |  | 553 |
Other |  |  | 37 |  |  |  | 26 |
International segment revenue |  |  | 797 |  |  |  | 760 |
Australia |  |  |  |  |  |  |  |
Sportsbook |  |  | 329 |  |  |  | 351 |
Australia segment revenue |  |  | 329 |  |  |  | 351 |
Total reportable segment revenue |  | $ | 3,397 |  |  | $ | 2,918 |
iGaming revenue includes iGaming, Poker, and Lottery . The information below summarizes revenue by geographical market for the three months ended March 31, 2024 and 2023:
|  | Three months ended March 31, |
($ in millions) |  | 2024 |  |  | 2023 |
U.S. |  | $ | 1,399 |  |  | $ | 1,083 |
UK |  |  | 782 |  |  |  | 660 |
Ireland |  |  | 77 |  |  |  | 78 |
Australia |  |  | 329 |  |  |  | 351 |
Italy |  |  | 365 |  |  |  | 369 |
Rest of the world |  |  | 445 |  |  |  | 377 |
Total revenue |  | $ | 3,397 |  |  | $ | 2,918 |
The information below shows the reconciliation of reportable segment Adjusted EBITDA to loss before taxes for the three months ended March 31, 2024, and 2023:
|  | Three months ended March 31, |
($ in millions) |  | 2024 |  |  | 2023 |
U.S. |  | $ | 26 |  |  | $ | (53 | )
UKI |  |  | 268 |  |  |  | 206 |
International |  |  | 173 |  |  |  | 149 |
Australia |  |  | 83 |  |  |  | 85 |
Reportable segment adjusted EBITDA |  |  | 550 |  |  |  | 387 |
Unallocated corporate overhead 1 |  |  | (36 | ) |  |  | (35 | )
Depreciation and amortization |  |  | (297 | ) |  |  | (297 | )
Share-based compensation expense |  |  | (41 | ) |  |  | (46 | )
Transaction fees and associated costs 2 |  |  | (29 | ) |  |  | (3 | )
Restructuring and integration costs 3 |  |  | (23 | ) |  |  | (21 | )
Other expense, net |  |  | (174 | ) |  |  | (45 | )
Interest expense, net |  |  | (112 | ) |  |  | (92 | )
Loss before taxes |  | $ | (162 | ) |  | $ | (152 | )
1. | Unallocated corporate overhead includes shared technology, research and development, sales and marketing, and general and administrative expenses that are not allocated to specific segments.
2 | Comprises advisory fees of $25 million related to implementation of internal controls , information system changes and other activities related to the anticipated change in the primary listing of the Group for the three months ended March 31, 2024.
3 | During the three months ended March 31, 2024, costs of $23 million (three months ended March 31, 2023: $21 million) primarily relate to various restructuring and other strategic initiatives to drive synergies. These actions include efforts to consolidate and integrate our technology infrastructure, back-office functions and relocate certain operations to lower cost locations. The costs primarily include severance expenses, advisory fees and temporary staffing cost.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 22 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-22 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 15 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-15 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 31 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-31 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 42 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-42 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 40 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-40 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//280/tableOfContent Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 26 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-26 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 34 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-34 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 41 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-41 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-21 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-21 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 + Details
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