DraftKings Slashes Earnings Outlook on Prediction-Market Spending

The sports-betting company now expects full-year revenue of $6.35 billion to $6.55 billion, compared with its previous forecast of $6.5 billion to $6.9 billion. Adjusted earnings before interest, taxes, depreciation and amortization are projected at $175 million to $275 million, down from an earlier range of $700 million to $900 million.

DraftKings said it expects to invest $650 million to $700 million in its prediction markets offering, which launched late last year. Revenue from the business will be immaterial this year because promotions for new customers are offsetting most of the gross revenue it generates. The company plans to spend $175 million to $225 million on the offering in the current fourth quarter.

For fiscal 2027, DraftKings forecast revenue of $7.35 billion to $7.75 billion, below analysts’ projection of $7.61 billion. It expects prediction markets to contribute $650 million to $750 million in sales. Chief Executive Jason Robins said more than 1.6 million customers have engaged with the offering this year.

In the third quarter, DraftKings posted a loss of $468.7 million, or 94 cents a share, compared with a loss of $256.8 million, or 52 cents a share, a year earlier. Analysts had forecast a loss of 41 cents a share. Revenue rose 16% to $1.33 billion, below the $1.39 billion expected by Wall Street.

DraftKings is spending to compete with newer prediction-market operators including Kalshi and Polymarket. Rival Flutter, which operates FanDuel, said earlier this week that increased marketing by prediction-market companies had pushed up advertising costs.