DraftKings Q2 revenue dip and stock slide as prediction markets grow

DraftKings reported second‑quarter wagering of $13.1 billion, a 15 % year‑over‑year increase, but revenue fell 5 % to $1.443 billion, missing analysts’ expectations. Adjusted EBITDA dropped sharply to $114.6 million from $300.6 million a year earlier, and the company posted a net loss of $67.6 million versus a net profit of $157.9 million in the prior quarter. The decline was attributed to customer‑friendly outcomes that reduced sportsbook margins and higher promotional spending aimed at acquiring new users. Despite the short‑term weakness, DraftKings kept its full‑year 2026 guidance of $6.5‑$6.9 billion in revenue and $700‑$900 million in adjusted EBITDA. The stock fell about 8.4 % in mid‑day trading, hovering near $21.6 per share, while analysts maintain price targets between $27 and $34. The firm is expanding into prediction markets through its 2025 acquisition of Railbird, a CFTC‑licensed exchange, and has launched DraftKings Predictions, which recorded $1.3 billion in consumer trading volume in April 2026. Prediction‑market platforms now account for roughly 27 % of U.S. sports‑betting volume during the 2026 World Cup, challenging traditional sportsbook models. DraftKings aims to create a “super app” that combines sportsbook and prediction‑market functions.