DraftKings Takes on Prediction Rivals as Q2 Earnings Show a Business in Transition

Jason Robins used a CNBC appearance and the company's second-quarter earnings call to frame DraftKings' prediction-market push as a competitive strength, while accusing Kalshi and Polymarket of misleading the public.

Mixed Q2 for the core business

DraftKings reported $1.44 billion in total second-quarter revenue, down about 5% year over year and short of the $1.52 billion consensus estimate. Sports revenue rose nearly 6% to $1.99 billion, while adjusted diluted EPS was $0.09. The company blamed customer-friendly sports outcomes and higher promotional spending for the year-over-year decline, and it reiterated that the core business is on track for annualized adjusted EBITDA of $1 billion. DraftKings also consolidated online sportsbook, retail sportsbook and prediction market revenue into a single segment.

Prediction market ramp-up

Roughly 600,000 customers have engaged with DraftKings' predictions product since the start of the year, and management put annualized volume at $11 billion in July, up from $2.3 billion in April. The company's DKeX exchange is live and has received FCM approval, giving DraftKings an integrated brokerage, exchange and market-making stack under one roof. Robins said revenue per prediction customer would likely run below sportsbook levels, but argued vertical integration could support similar gross profit per customer over time.

DraftKings also said customer overlap with the largest prediction market operator is around 1% in sportsbook states, and that 80% to 90% of consumer volume on that platform comes from professionals and syndicates.

Robins vs. the pure-play rivals

Robins welcomed competition from Kalshi and Polymarket, which he noted carry valuations north of $20 billion, but disputed the idea that prediction platforms have no incentive to "see people win or lose." He countered that recreational customers often end up as counterparties to institutional market makers equipped with quantitative tools. "Some of the companies out there are spinning narratives that just aren't true," Robins said.

Kalshi has recorded $39.7 billion in annualized trading volume in 2026. CEO Tarek Mansour did not respond to Robins' comments on X. Both Robins and Mansour were appointed to the US Commodity Futures Trading Commission's Innovation Advisory Committee earlier this year.

Football season and the competitive landscape

DraftKings averaged 3.6 million monthly unique players in the quarter, up 9.1% year over year, boosted by the 2026 FIFA World Cup. The company is counting on the NFL season to accelerate customer acquisition and plans to update its "super app" with additional predictions offerings. Kalshi lists an event contract on whether DraftKings' user figure exceeds 4 million this fiscal year; the contract traded at 64% as of Friday afternoon.

Flutter's FanDuel generated just $6 million from predictions in the second quarter and is thought to be roughly nine to twelve months behind DraftKings in building a predictions offering, with no decision yet on launching its own market-making exchange. Flutter has said it will invest an additional $270 million in FanDuel US in the second half of the year. DraftKings shares closed Friday at $24.03, up 8%, while Flutter fell about 9% on Wednesday after CEO Peter Jackson announced his departure.

The regulatory question

Prediction markets allow DraftKings to reach customers in states where sportsbooks are blocked, under a lighter tax and licensing regime, and to access users under 21 in markets where sportsbooks face tighter restrictions. Whether state lawmakers allow that gap to persist is the open question hanging over the category. CFO Alan Ellingson said the company remains focused on improving the efficiency of its cost structure while investing in long-term opportunities, and Robins struck an optimistic tone ahead of the season: "We are on offence, the core business is firing."