Morgan Stanley analyzed sports betting app downloads to see trends post NFL season and leading up to March Madness. Feb app downloads increased 84 percent y/y, strong but a slight deceleration. DraftKings had leading 35 percent share, FanDuel was close behind (31 percent), FOX Bet held 7.5 percent, and MGM/GVC increased to 6 percent.

Strong app downloadsThe last 4-weeks of data show U.S. sports betting app downloads increased 84 percent y/y, below Jan +118 percent, but still strong as the prior month benefited more from the NFL season (including playoffs) leading up to the 2/2 Super Bowl. From late January 2020 (a peak for downloads due to the Super Bowl) to the company's last data point, trailing 4-week downloads have declined (29 percent), similar with the comparable period last year (down (25 percent). Using last year as a guide, Morgan Stanley expects trailing 4-week downloads to decline another ~35 percent through the first week of March before increasing sharply (~66 percent) into March Madness. Selection Sunday is 3/15, followed by the first games on 3/17.

FanDuel and DraftKings have continued to dominate app download share, but for the first time since June 2019, DraftKings is leading. The two had combined market share of 66 percent, slightly lower than Jan 68 percent, but above the prior 10 months 53-63 percent. DraftKings had 35 percent market share of U.S. sports betting app downloads, followed by FanDuel 31 percent, FOX Bet 7.5 percent, MGM/GVC 6 percent, William Hill 5 percent, and each of bet365 and theScore 4 percent. DraftKings' share (35 percent) was well above January 29 percent/Dec 28 percent, and its highest since October 2018, while FanDuel's share (31 percent) was below January 38 percent/Febrary 35 percent, but similar with its LTM avergage of 32 percent. FOX Bet held its market share m/m at 7.5 percent, Morgan Stanley believes suggesting solid traction in PA given its higher downloads there vs. NJ, and the more aggressive competitive environment since DraftKings launched in PA in November MGM/GVC's download market share increased to 6 percent vs. 5 percent in January / 4 percent in December, a sign it is benefiting from more ads/promos, while key partnerships (such as leagues and Yahoo Sports) could be providing support. MGM/GVC's late February launch in IN was not captured in our sample. William Hill held share for the second consecutive month at 5 percent, suggesting its declines from August-December may have been temporary, while bet365 and theScore were also flat m/m at 4 percent each. Notably, PENN's partners DraftKings, PointsBet, FOX Bet, and theScore had combined app download market share of 48 percent in February, better than January 42 percent, and the company's estimate for combined January revenue market share (also ~42 percent). PENN remains our top pick for U.S. sports betting exposure due to its Barstool partnership and broad 19 state footprint.

FOX Bet's Super 6 (free-to-play app) keeping pace with competition, though absolute downloads remain low. According to Sensortower data, Super 6 has been downloaded 1.3 million times from its early September 2019 launch, 8x higher than NBC Sports Predictor app when it launched and roughly 1.6x higher than the NBC Sports Predictor app over the same time period. Over the last four weeks of data, Super 6 downloads have averaged 16,000 per week, ahead of NBC's 3,000 per week.