Both companies had a tough quarter on the sportsbook side, blaming customer-friendly results and heavier promotions. Both are betting that prediction markets are the next growth engine: DraftKings says its Predictions product is growing faster than expected, and FanDuel is expanding FanDuel Predicts and moving its sports contracts to Crypto.com. For DFS players, the practical takeaway is simple — expect aggressive promotions this football season, and compare offers before you deposit.
The Quarter at a Glance
A quick note before the numbers: DraftKings reports as its own company, while FanDuel is part of Flutter Entertainment, which reports a U.S. segment that is primarily FanDuel. The figures below compare DraftKings with Flutter's U.S. segment, so they aren't perfectly apples to apples. They're close enough to show the trend.
| Q2 2026 | DraftKings | Flutter U.S. (FanDuel) |
|---|---|---|
| Revenue | $1,443M (down 5%) | $1,683M (down 6%) |
| Adjusted EBITDA | $114.6M (vs $300.6M) | $119M (vs $400M) |
| Monthly players | 3.6M MUPs (up about 9%) | 3.843M AMPs (up 9%) |
| Sports / sportsbook revenue | Sports: $891.9M (down 10.6%) | Sportsbook: $1,039M (down 15%) |
| iGaming revenue | $461.9M (up 7.5%) | $577M (up 14%) |
| Prediction product | DraftKings Predictions | FanDuel Predicts |
Sources: DraftKings' Q2 2026 earnings release and Flutter Entertainment's Q2 2026 results, both published August 5–6.
DraftKings: Lower Revenue, Bigger Ambitions
DraftKings reported Q2 revenue of $1.443 billion, down 5% from $1.513 billion a year earlier. The company said the decline was driven by customer-friendly sport outcomes and promotional reinvestment in Sportsbook and Predictions.
The bottom line moved the same direction. DraftKings posted a net loss of $67.6 million, compared with net income of $157.9 million in Q2 2025. Adjusted EBITDA fell to $114.6 million from $300.6 million.
The customer numbers were more encouraging. Monthly unique payers rose about 9% to 3.6 million, and total Sports Consumer Volume climbed 15% to $13.1 billion. Average revenue per monthly unique payer fell 13% to $132 — more players, but less revenue from each.
The mix matters too. DraftKings' sports revenue, which includes sportsbook and fantasy, fell 10.6% to $891.9 million. iGaming revenue grew 7.5% to $461.9 million, and other revenue rose 5.2% to $89.4 million. Casino-style games carried the quarter while sports results went against the house. The 15% jump in Sports Consumer Volume is the number to watch: it shows customers are wagering and trading more across sports, even if DraftKings kept less of it this quarter.
The headline for DraftKings was Predictions. The company launched DraftKings Predictions in December 2025, and CEO Jason Robins was upbeat in the release: "Our Super App is now live nationwide, and Predictions is already growing faster than we anticipated." He added that DraftKings believes it "can win the category this NFL season and beyond."
How fast is "faster than anticipated"? DraftKings didn't break out Predictions volume in its earnings release, but a post-earnings report from Alphaspread said annualized Predictions volume rose from about $2.3 billion in April to about $11 billion in July. Treat that as a reported figure, not a company-audited one.
Despite the weak quarter, DraftKings kept its full-year guidance: revenue of $6.5 billion to $6.9 billion and adjusted EBITDA of $700 million to $900 million. CFO Alan Ellingson said the core business remains on track for about $1 billion in adjusted EBITDA.
FanDuel: Squeezed Margins, a Platform Shift
Flutter's U.S. segment reported revenue of $1.683 billion, down 6%. Sportsbook revenue fell 15% to $1.039 billion even though handle rose 2% to about $11.96 billion. iGaming was the bright spot, up 14% to $577 million.
Profitability took a bigger hit. U.S. adjusted EBITDA dropped about 70%, to $119 million from $400 million. Flutter pointed to promotional spending, which rose to 5.4% of handle — up 140 basis points — reflecting state launches and investment around the World Cup. It also cited customer churn following weeks when results went against customers.
Flutter cut its U.S. guidance, reducing its revenue outlook by $395 million and its adjusted EBITDA outlook by $210 million. That includes about $385 million of investment aimed at strengthening the FanDuel proposition.
On prediction markets, Flutter made three notable points:
- Product expansion: FanDuel Predicts added player props and customizable combos.
- Customer acquisition: Flutter said FanDuel Predicts "allows us to acquire customers ahead of sports betting regulation in new states."
- Platform move: "All FanDuel Predicts sports and novelties contracts will now be moved to Crypto.com," Flutter said. The company also expects its market-making activity to deliver about $50 million in revenue in 2026, and it's working toward a "One App" experience.
There's also a leadership change coming. Flutter said CEO Peter Jackson will step down, with Dan Taylor taking over as CEO on October 1, 2026.
What "Customer-Friendly Outcomes" Means
Both companies pointed to the same culprit, so it's worth understanding. A sportsbook's revenue depends on how much of the money wagered it keeps. When favorites cover and popular parlays hit, customers win more and the operator keeps less. DraftKings called these "customer-friendly sport outcomes." Flutter flagged a related problem: customer churn after weeks when customers lost. Good weeks for the house can still cost an operator if frustrated players stop coming back.
The other half is promotions. Bonuses, odds boosts, and deposit matches cost the operator money up front. Flutter put a number on it: promotions reached 5.4% of handle in the quarter. DraftKings said it reinvested in promotions across Sportsbook and Predictions.
Neither factor is a sign that players are suddenly better. It's mostly variance plus deliberate spending. But the spending part matters to you: when two companies are both willing to give up margin to win customers, the offers get better.
Why Prediction Markets Are the Battleground
Put the two reports side by side and the strategy is the same. The traditional sportsbook business had a rough quarter at both companies. Both are leaning into prediction markets as the next growth lever, and both are using them to reach customers in places sportsbooks can't.
FanDuel said it out loud: Predicts lets the company acquire customers before sports betting is legalized in a state. DraftKings framed it as a "Super App" now live nationwide. The goal at both companies is the same — sign customers up before NFL season and keep them in one app across DFS, prediction markets, and, where legal, sportsbook and casino.
They aren't alone. Earlier this summer Underdog launched its own CFTC-licensed exchange, UDX, and on July 30 IG Group announced a deal to acquire Underdog. We covered both in our UDX explainer and our IG–Underdog breakdown. PrizePicks has offered prediction markets through Kalshi since late 2025. Every major name in daily fantasy now has a prediction-market play.
The Legal Fight Follows the Growth
Growth is bringing scrutiny. Front Office Sports reported on August 4 that DraftKings has been named in three lawsuits arguing DraftKings Predictions is effectively an unlicensed sportsbook:
- A federal class action filed in Massachusetts on July 28.
- A South Carolina state court case filed July 29, which also names Polymarket and Crypto.com.
- A second federal case in Massachusetts filed August 3.
DraftKings responded: "We remain confident in our legal position."
These suits don't affect DraftKings' daily fantasy contests, which are regulated separately as fantasy sports, state by state. But they're a sign of how contested prediction markets remain. Courts and states are still working through who gets to regulate sports event contracts, and the answer may take a while.
What This Means for DFS Players
You don't need to follow the earnings calls to benefit from this. Here's what matters for your account:
- Expect aggressive promotions. Both companies spent heavily on promotions in Q2, and FanDuel is explicitly investing to strengthen its offering. With NFL season starting soon, competition for new and returning players should stay intense.
- DFS is part of a bigger app now. Both companies want you in one account across DFS, prediction markets, and other products. That's convenient, but it also means more cross-promotion. Know which product you're actually using.
- Keep your bankrolls separate. A DFS bankroll and a prediction-market bankroll are different things. Our 1% bankroll rule is a good place to start for both.
- Read the bonus terms. Promotions are how these companies are competing. Make sure you understand playthrough and eligibility before you deposit.
- Check your state. DraftKings says its DFS is available in 44 states plus D.C., and both platforms' products are available in eligible states — check your state. Prediction-market availability can differ from DFS availability.
DraftKings or FanDuel for DFS This Season?
The quarterly results don't change the basic DFS comparison. DraftKings still runs the bigger tournament ecosystem and multi-sport menu. FanDuel's DFS product remains simpler and quicker for newer players. Our full DraftKings vs FanDuel comparison walks through contest types, scoring, and bonuses in detail, and our best DFS site for NFL guide covers football specifically.
What the earnings do tell you is that both companies are spending to win this NFL season. That's good news for players who shop around.
What to Watch Next
- NFL season. Both companies have tied their prediction-market plans to football. DraftKings said it believes it can win the category "this NFL season," and Flutter has expanded FanDuel Predicts with player props and combos.
- FanDuel's Crypto.com move. Flutter said FanDuel Predicts sports and novelties contracts will move to Crypto.com. If you use Predicts, watch for in-app notices about what that means for your account.
- Flutter's leadership change. Dan Taylor is set to become Flutter CEO on October 1.
- The lawsuits. The three cases against DraftKings Predictions are at an early stage.
The Bottom Line
DraftKings and FanDuel both posted weaker year-over-year sportsbook results in Q2, and both blamed a mix of customer-friendly outcomes and heavier promotional spending. Both are also pushing hard into prediction markets, with DraftKings saying Predictions is growing faster than expected and FanDuel expanding Predicts and moving its sports contracts to Crypto.com.
For DFS players, that competition is an opportunity. Expect strong promotions heading into football season, keep your DFS and prediction-market bankrolls separate, and compare offers on both apps before you commit. There's no rule against having accounts at both.