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Segments and Disaggregation of Revenue
 3 Months Ended
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.