By Prerna Bedi
(Reuters) -William Hill-owner 888 Holdings (LON:888) forecast its 2024 profit to be at the lower end of market expectations on Wednesday, due to heavy investments in Artificial Intelligence (AI) and higher marketing costs, sending its shares down 12%.
Shares in the gambling firm were down to 72.85 pence at 0831 GMT, the biggest loser on the FTSE small cap index.
"We are now taking rapid actions to position the Group for future success, reducing our overhead costs and freeing up funds to invest in growth based upon our new strategy and value creation plan," CEO Per Widerström said in a statement.
The company said it had initiated a 30-million-pound ($37.9 million) cost-saving programme to support higher marketing spend through 2024, but also invested in areas of intelligent automation and AI-powered data and insights.
It declined to give any further details.
"With... £30m additional cost savings announced today, we sense a step change in urgency," Jefferies analysts said in a note.
Adjusted core profit for the 12-month period through December 2024 is expected to be between 340 million pounds and 397 million pounds, according to an analyst consensus compiled by the Gibraltar-headquartered company.
"We believe that this kitchen-sinking of numbers was anticipated in the share price, but the growth potential is not," analysts at Peel Hunt (LON:PEEL) said.
The betting firm, which counts Entain (LON:ENT) and Flutter among its competitors, said it was positive about 2024 revenue, backed by consistent growth in active players in both the UK and international segments and also improved average revenue per user.
($1 = 0.7909 pounds)