This is how much the red of Dazn (which evaluates the listing on the stock exchange) expands
Dazn closed the 2021 budget with a hole of 2.3 billion dollars. The sports streaming platform's losses jumped 79% as costs rose
The red in Dazn's balance widens.
Losses of the sports streaming platform backed by billionaire Len Blavatnik rose 79% to $2.3 billion in 2021, reports Bloomberg . Even though revenues in 2022 climbed to $2.3 billion, the company has lost more than $6 billion since 2016. The reason behind the hole in the balance sheet is the hefty investment in major soccer rights. Like the one for the exclusive Serie A of Italian football which is also creating trouble for the sports streaming service. Just Tuesday Dazn agreed to take urgent steps to improve its streaming service in Italy following complaints from fans about problems in its Serie A football broadcasts .
All the details.
REVENUES GROW FOR DAZN
In 2021, the company's revenue grew 79% to $1.56 billion as the platform gained new subscribers, with the majority of sales coming from Europe, the Middle East and Africa. Also, in an effort to grow and diversify its revenue, Dazn last year announced plans for a sports betting partnership with Pragmatic Group, a betting and gaming technology company.
GUILT OF FOOTBALL RIGHTS
However, record revenues are beaten by costs. According to company accounts, Dazn's spending on sports rights rose to $1.9 billion in 2021 from $1.2 billion a year earlier. In an interview with Bloomberg , chief executive Shay Segev highlighted the "massive investment" that year to acquire the rights to Italian and German football.
Indeed, in 2021 Dazn was awarded the exclusive right to broadcast Serie A matches in Italy for three seasons with a 2.5 billion euro ($2.7 billion) offer, in one of the largest deals for the video streaming service in Europe. But the contract proved to be a challenge for Dazn, with the service experiencing disruptions on several occasions and facing social media criticism from users.
Content and marketing costs have also soared, with the company investing nearly $510 million in 2021 on content, marketing, and improvements to its production capabilities compared to $118.6 million during 2020. According to reports emerges from the 2021 budget, Dazn “is planning a rights expenditure of 3.2 billion dollars until the end of 2028, an amount that could increase if the company manages to renew its domestic rights to Serie A for the next cycle” underlines Football and finance .
DEEP RED IN THE BUDGET
And these expenses weigh on the balance sheet of the London-based company. Since its launch in 2016, Dazn has lost more than $6 billion, according to Bloomberg calculations based on documents from the British company, highlighting the difficulty in selling enough season tickets to compensate for the huge investments needed to win attractive sports rights such as the championship football club La Liga. In 2021, its shareholder Blavatnik agreed to a recapitalization of the company that brought its net debt down to $14.3 million at the end of the year from $1.3 billion a year earlier.
DAZN CEO WATCHES IPO IN FOOTSTEPS OF NETFLIX AND AMAZON
Finally, CEO Segev explained to Bloomberg that although plans for an initial public offering are on hold for now due to difficult global capital markets, it could happen in the next two or three years. “I don't really have any preferences, I just think it really makes sense for this to become a publicly traded company,” Segev said. “Netflix story, Amazon story — I think Dazn is going there too.”
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/ecco-quanto-si-allarga-il-rosso-di-dazn-che-valuta-la-quotazione-in-borsa/ on Thu, 12 Jan 2023 06:18:44 +0000.