British bookmaker 888 Holdings said today it had terminated its deal with Sports Illustrated and was looking at options to sell or exit its direct-to-consumer US operations, due to intense competition and low margins.

Sports Illustrated (SI), known for its eponymous sports magazine, had entered the online betting market in an exclusive deal with 888 in 2021 in a bid to entice SI fans.

Sportsbetting in the US took off in the last few years since it was legalised in 2018, with players in the country partnering up with or buying out British gambling groups that have more experience in that field.

But it has been a long road towards profitability for many sports gambling groups including market leader Flutter Entertainment-owned FanDuel, which turned profitable for the first time only last year.

“In the US, the intensity of competition and requirement for scale means huge investment is required to reach profitability,” 888 CEO Per Widerström said in a statement.

BetMGM, jointly owned by Ladbrokes-owner Entain and MGM Resorts, made its first profits in the second half of last year.

888, which is active in four US states, said it was terminating its agreement with SI-parent Authentic Brands AUTH.N and would pay a termination fee of about $25m.

The termination is expected to help save 888 about $6m to $7m a year in 2024 and 2025, it added.