Overview
- DraftKings' shares plunged about 25% after hours on Friday following its third‑quarter report that cut full‑year 2026 revenue guidance to roughly $6.35 billion–$6.55 billion and widened adjusted EBITDA losses.
- The company said it will spend $650 million–$700 million of Adjusted EBITDA on Predictions in 2026, a rise that will absorb most near‑term group profits and push Predictions net revenue to be “immaterial” this year because the firm is returning much of the gross to new‑user promotions.
- DraftKings disclosed that DKeX trades showed an average gross take of about 11.1% in September–October and that the company captures roughly two‑thirds of that gross across its brokerage, exchange operations and market‑making.
- Independent analysts challenge DraftKings’ claim that it is the clear No. 3 by notional volume, noting that notional volume counts every contract as a flat unit and can overstate retail engagement compared with measures that track actual dollars risked.
- Regulatory uncertainty about whether prediction markets can offer sports event contracts prompted DraftKings to model downside scenarios, including a July 2028 cutoff, and to say it will scale Predictions spending up or down as legal clarity emerges.