Capital Allocation
Q: How are you allocating capital?
A: Management is very confident in its strong free cash flow and is evaluating various capital‐allocation options—including potential shareholder returns—while remaining focused on organic growth, with more specifics expected next quarter.

M&A Strategy
Q: What’s your approach to M&A?
A: They maintain a very high bar for M&A, prioritizing domestic transactions and emphasizing that large, simultaneous deals are challenging; organic growth remains the primary driver.

EBITDA Contribution
Q: Will new states boost EBITDA later?
A: Management expects that launches like North Carolina and Vermont will contribute to adjusted EBITDA in the back half of the year, building on past successful state expansions.

Structural Hold Improvement
Q: Why raise structural hold to 10.5%?
A: Enhanced product offerings—such as progressive parlays and improved bet mix—give the company confidence to target a 10.5% hold, reflecting a more favorable revenue mix.

Promotional Efficiency
Q: What drives improved promo expense performance?
A: Natural maturation of customer bases and lower launch penetration have helped cut promo expenses by over 700 bps, creating better operating leverage.

Marketing Efficiency
Q: Are CAC improvements sustainable?
A: With a reported 40% improvement in CAC year-over-year, management sees strong, efficient marketing as an opportunity to optimize further while investing modestly in growth areas.

iGaming Growth Drivers
Q: What fuels accelerated iGaming growth?
A: Industry momentum, enriched product features, and effective cross-selling from sports betting are all contributing to faster iGaming growth.

Customer LTV Improvement
Q: Are new cohorts improving LTV?
A: Lower CAC combined with enhanced customer experiences have led to stickier users and improved lifetime values, benefiting overall profitability.

Payment Processing Optimization
Q: How will payment costs improve?
A: The focus is on exploring consumer incentives for lower-cost payment methods and possibly in-housing technology to drive down processing costs over time.

Pricing Competitiveness
Q: How does pricing drive retention?
A: Competitive, tight pricing fosters customer retention in most mainstream bets, ensuring that the balance between odds and hold remains advantageous.

Media Partnerships
Q: How does Amazon boost your offerings?
A: The Amazon partnership has provided significant value for Thursday Night Football, with discussions open to expanding the relationship as media deals evolve.

Legislative Focus
Q: Which states are priorities for legislation?
A: Management is eyeing major markets like Texas—and other populous states—as key targets for future sports betting and iGaming growth, also leveraging non-legislative opportunities like acquisitions (e.g., Jackpocket).

MAU & Product Innovation
Q: What drove recent MAU changes?
A: Seasonality and differences in state launch timing affected MAU levels, while new products like Pick6 are designed to grow the customer database in unregulated markets.

Technology Edge
Q: How will tech maintain competitive edge?
A: Leveraging scale and extensive data, management is investing in behind‑the‑scenes technological innovations that enhance uptime and personalize customer experiences effectively.

Acquisition vs. Monetization
Q: Which driver outperformed recently?
A: Management noted that both increased customer acquisition and improved retention contributed; while acquisitions occasionally drive standout quarters, the focus remains balanced with monetization.

AI Utilization
Q: What is your AI strategy?
A: The company is testing several best‑in‑class third‑party AI tools to enhance product development, operational efficiency, and responsible gaming measures, though it is still in early stages.

State Tax Impact
Q: How would higher state taxes affect margins?
A: Management expects that any tax increases would ultimately be absorbed by consumers and counteracted by reduced external marketing spend, as states aim to stay competitive.

iGaming Cross-Sell
Q: Will cross-selling improve overall LTV?
A: By leveraging already acquired customers across multiple products, cross-selling is seen as a highly cost-effective way to boost LTV and drive additional profitability.

iGaming Market Share
Q: What’s the outlook on iGaming share?
A: The focus is on delivering a superior, profitable customer experience rather than merely increasing GGR share, positioning the company for sustainable market leadership.

Future Hold Evolution
Q: How will hold rates progress over time?
A: Ongoing product improvements and a higher average bet mix are expected to drive further improvements in hold, even though precise long-term targets remain open‑ended.

Q1 Hold Confirmation
Q: What was the Q1 hold percentage?
A: In the first quarter, management confirmed an approximate hold of 9.5%, aligning with earlier structural estimates.