DraftKings posted a steeper-than-expected loss for the recent quarter, and shares fell 7%, though it said users have started betting again as sporting events began to resume.

The online-betting company posted a loss of $161.4 million, compared with a loss of $28.11 million a year-ago.

“As sporting events began to resume, the company saw increased engagement with its sports-based product offerings, which contributed to sequential monthly revenue improvement during the second quarter. This positive momentum has accelerated with the return of MLB, the NBA, WNBA, the NHL, and MLS.”

The company says it had $1.2B on its balance sheet at the end of the quarter after a follow-on offering.

CEO and cofounder Jason Robins said “DraftKings is well-positioned to build upon the growth of the online sports betting and iGaming market in the U.S.” In the second quarter, DraftKings closed its merger with SBTech and Diamond Eagle and went public, and launched sports betting in Colorado and iGaming in New Jersey.

Early in the question portion of the more than hour-long earnings call on Friday, Robins was asked about the IRS memo that came to light Thursday saying daily fantasy sports should pay the same excise tax as sports betting.

Robins said the memo is non-binding, adding that the company believes it is a deeply flawed analysis. He said he believes the company’s position is the correct one based on arguments that it’s a game of skill in federal and state cases and legislation.