The strong momentum in 2020 has continued into the first quarter of 2021, with a new all-time-high for FTDs and revenues.After a huge 2020 when poker revenue for 888poker was up nearly 50% year-over-year, 888 Holdings have continued the gains into the first quarter of 2021. The poker vertical earned $14.7 million in the first quarter this year, up 13% in raw numbers, and 10% adjusted for currency changes.
Overall, B2C revenue was up more than 55% in currency adjusted numbers, with more than $260 million earned in the 1st quarter this year, compad to $155 million in the first quarter of 2020. That actually represents 67% YoY in raw numbers, but comes down to 57% at constant currency.
In their annual report, 888poker cites the positive reaction to the new Poker 8 software product as a big part of their poker success. Rolled out over 2020 and 2021 through most of the global market, the new software is a complete overhaul of the previous version, and marks a significant step forward.
Poker 8 rolled out in conjunction with the Made to Play campaign. The new strategy of random prize drops on tables was a notable departure from their more traditional strategy of mission-based rewards.
The YoY increase in early 2021 might be an indication of the new strategy working. At the very least, the continued growth in the poker vertical shows solid player support for the new software and games, which bodes well for the rest of the year.
2020 Revenue Shows Big Growth
2020 will no doubt stand out as a unique year in the history of online poker. When the world started to lock down in March of 2020, online gaming operations like poker were the beneficiaries as people started to look for things to do from their living rooms.
888poker was not left out of the COVID boost. In 2020, the YoY poker revenue increased nearly 50% over 2019. 2019 represented a low point in revenue since 2010. After earning more than $90 million at their height in 2013 and 2014, 888poker has seen revenues drop consistently since the high until the gains of 2020 halted the slide.
By 2019, poker revenues were down to $42.7 million, less than half the high point in 2014, but 2020 turned that around to post 47.8% YoY gains with $63.1 million in revenue. So far, with more gains in Q1 2021, it looks like this year will also post strong revenue numbers.
It is worth adding a note of caution about YoY numbers going forward this year. The results are starting to lap the largest months of the 2020 pandemic bump, so it will take stellar performances in Q2 2021 to even come close to those stratospheric numbers from last year.
Four quarters of results that matched Q1 would lead to 2021 revenue of just under $60 million for poker. That would be a small drop from the 2020 number, but a very respectable figure compared to revenue of $49 million and $42.7 million in 2018 and 2019 respectively.
Revenue for Q2 would have to top $22 million for the first half of 2021 to match 2020, so it seems unlikely that H1 this year will show much growth over last year. However, based on the Q1 results so far, H1 2021 will compare very favorably with 2019, and likely on par with or better than H1 2018, when they posted just over $30 million.
Mobile Focused Poker 8
While the COVID pandemic was a big part of the increased revenue from 2020, another big factor was the introduction of the new Poker 8 software throughout the global market over the course of 2020.
The new 888poker software is a significant improvement from the previous version. While the previous version was well tested over time, by the time it was retired in most of the world, it was past its prime, and competitors had software the exceeded the previous version in significant ways.
Poker 8 changes that, and gives 888poker a modern poker client that competes with the best poker software in the world. One of the key features of Poker 8 is a focus on mobile use, with next generation, portrait-first mobile clients and seamless multi-table swiping.
Poker 8 is now the standard across the global market, as well the European regulated markets. Expansion through the US regulated markets is planned for 2021, which will make Poker 8 the default standard across the 888poker brand, regardless of where it is used.
It seems unlikely that revenue numbers going forward in 2021 will manage to hit the heights seen last year, but 2020 was a unique year from that regard. The solid Q1 results mean 2021 is almost certain to compare well against the 2018 and 2019 numbers, showing the impact of the new software outside of the artificial boost generated by the COVID-19 pandemic in 2020.
888poker CEO Itai Pazner was very positive in the recent Q1 results report. “The strong momentum in 2020 has continued into the first quarter of 2021, with a new all-time-high for FTDs and revenues. Our differentiated products and our data-driven marketing continued to underpin strong progress, supported by a favorable industry backdrop.”